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Over recent years, Apple has been making active efforts into pushing more control over its ecosystem and building its current offering, ranging from Apple's own chips to adding more digital services. One of these includes introducing more subscription-based services. Now, it's rumored that Apple is working on a hardware subscription for its iPhones, similar to the company's existing subscription offerings.
With the tech giant earning over $19 billion in the last quarter of 2021 in services alone, Apple doesn't appear to be slowing down in the subscription department, with services including the likes of Apple Music, iCloud, Apple TV Plus, and Apple Arcade among others. As such, a recent report indicates that the tech giant is preparing for a similar strategy for its flagship product, the iPhone. The subscription in question is expected to be tied to Apple's other services and launched as a bundled offering.
Accordingly, the subscription will fall similar to auto-leasing programs, though it will be the first time Apple will go for a hardware subscription model. However, it's expected that the service won't follow an installment scheme where the cost of the device would be divided over 12 or 24 months. Instead, it will be a specified monthly fee depending on the device in use linked to the Apple ID, be it an iPhone 13 mini or an iPhone SE with 5G. Apple is also seemingly working on the possibility of letting users swap devices for newer models when launched under the subscription program.
While it's likely that Apple won't officially announce any details about the service just yet, there are speculations that this will be tied to Apple One bundles and AppleCare plans. Back in 2020, the tech giant launched bundled services that include its offerings like TV+, Arcade, Music, and iCloud storage.
Of course, this isn't the first time Apple has looked to shift its hardware strategy, with the company already offering services that attempt a similar hardware subscription approach. For instance, the iPhone Upgrade Program allows users to pay for both AppleCare and an iPhone over 24 months, along with the option to trade in their device after making payments for 12 months. But this is merely one of its numerous hardware ambitions for the future. Apart from the upcoming hardware subscription, the company is also working on a rumored Apple gaming console.
But Apple isn't the first company to test a hardware subscription. Competitor Google has already tried something similar for its Chromebooks, along with Peleton Interactive for its bikes and fitness content. Regardless, it's safe to say that such a drastic strategy change may set a trend across the tech industry. Additionally, shifting to a subscription may ease Apple's efforts in selling its high price devices to more consumers. Especially considering the prices of the iPhone lineup.
Source: Bloomberg