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Apple Abandons Plan to Offer iPhones by Subscription
In a surprising move, Apple has reportedly decided to put its plan to offer iPhones as a monthly subscription service on hold. The decision comes after months of speculation and rumors surrounding the project.
According to Bloomberg, the company’s plans for a hardware subscription were ultimately too problematic to execute. Instead of applying your payments to a one-time loan from Citizen One or Goldman Sachs, like existing options such as the iPhone Upgrade Program or Apple Card Monthly Installments, Apple was planning to manage its own payment method through an Apple account.
The idea behind this plan was that by fronting the cost for an iPhone directly, Apple could encourage customers to upgrade their devices more frequently and increase its recurring revenue. However, it appears that the company has ultimately decided that the risks outweigh the benefits.
One of the main concerns surrounding the hardware subscription was the potential regulatory scrutiny it may have faced. By offering iPhones as a monthly payment option, Apple would have had to follow the same regulations as credit card companies, which could have been a significant headache for the tech giant.
Furthermore, there were also concerns about how such an offering might impact Apple’s relationships with carriers. It is worth noting that iPhone 16 users can already purchase their devices through installment plans from T-Mobile or Verizon, effectively making it a monthly payment option. However, this service may have been technically different from Apple’s proposed subscription model.
The decision to abandon the plan reflects a larger retreat from financial services on Apple’s part. Earlier this year, the company shut down its Apple Pay Later program and replaced it with access to Affirm loans through Apple Pay as part of iOS 18. The Apple Card is also reportedly in limbo as the tech giant searches for a partner to replace Goldman Sachs.
It remains unclear whether Apple will revisit the idea of offering iPhones by subscription at some point in the future, but for now, it appears that the project is on hold indefinitely.
Source: www.engadget.com
