Rent your hardware
-
Seems that Apple is considering a "subscription service" for some of its hardware - specifically the iPhone.
Apple Inc. is working on a subscription service for the iPhone and other hardware products, a move that could make device ownership similar to paying a monthly app fee, according to people with knowledge of the matter.
The service would be Apple’s biggest push yet into automatically recurring sales, allowing users to subscribe to hardware for the first time -- rather than just digital services. But the project is still in development, said the people, who asked not to be identified because the initiative hasn’t been announced.
Apple shares climbed to a session high after Bloomberg reported on the news Thursday and closed up 2.3% at $174.07. Though the stock is still down 2% for the year, Apple has now posted eight straight days of increases -- its longest streak since November.
Adopting hardware subscriptions, akin to an auto-leasing program, would be a major strategy shift for a company that has generally sold devices at full cost outright, sometimes through installments or with carrier subsidies. It could help Apple generate more revenue and make it easier for consumers to stomach spending thousands of dollars on new devices.
Already, the iPhone is Apple’s biggest source of sales, generating nearly $192 billion last year -- more than half the company’s revenue.
A spokeswoman for Cupertino, California-based Apple declined to comment on the company’s plans.
The idea is to make the process of buying an iPhone or iPad on par with paying for iCloud storage or an Apple Music subscription each month. Apple is planning to let customers subscribe to hardware with the same Apple ID and App Store account they use to buy apps and subscribe to services today.
The program would differ from an installment program in that the monthly charge wouldn’t be the price of the device split across 12 or 24 months. Rather, it would be a yet-to-be-determined monthly fee that depends on which device the user chooses.
The company has discussed allowing users of the program to swap out their devices for new models when fresh hardware comes out. It historically releases new versions of its major devices, including the iPhone, iPad and Apple Watch, once a year.
Apple has been working on the subscription program for several months, but the project was recently put on the back burner in an effort to launch a “buy now, pay later” service more quickly. Nonetheless, the subscription service is still expected to launch at the end of 2022, but could be delayed into 2023 or end up getting canceled, the people said.
Bloomberg reported last year that the company has been working on a “buy now, pay later” service for all Apple Pay transactions.
-
Geez I'm old. I thought you meant hardware, like from the hardware stores, Ace, Hardware Hank, or the big box places like Lowes and Home Depot.
That was an intriguing version, renting that kind of hardware. Reminds me of a Sven and Ole joke. Sven goes to buy a bunch of lumber, and the lumber guy asks Sven how long he wants it.
"Oh, I dunno, a long time, I suppose. We're building a house , don'cha know." -
Generally speaking, IT companies that move to "subscription as a service (SaaS)" make significantly more revenue.
For example, Adobe (you know... photoshop, etc) switched from selling their products (on CD, license, etc) to a cloud-based software subscription model. You can see the impact below:
-
What happens when components suppliers also go to subscription model?
Say, TSMC and Qualcomm only let Apple “subscribe” to each piece of silicon that they let Apple put into an integrated device and the silicon will work only when Apple maintains an active subscription?
Maybe someday individual software developers will only make available pieces of code such that they will run only for as along as the the likes of Apple and Adobe and Microsoft maintain an active license for the piece of code?
-
@89th said in Rent your hardware:
Generally speaking, IT companies that move to "subscription as a service (SaaS)" make significantly more revenue.
For example, Adobe (you know... photoshop, etc) switched from selling their products (on CD, license, etc) to a cloud-based software subscription model. You can see the impact below:
I'd say software is different. You also get more with Adobe now. They provide significant regular updates to everything in Creative Cloud.
("But Aqua, I don't want any of that shit, it's a ripoff." No, it's not. The software is no longer for you is all. Get Affinity instead, it's great stuff.)
I doubt Apple will let me trade in my phone every time they roll out a new one.
