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According to Bloomberg: "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."
Basically they want to make "buying" a Mac or iPhone more like leasing a car. You'd subscribe to a Mac Studio, for instance, like you subscribe to iCloud storage or an Apple One services bundle.
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0:00
Let's talk about Apple prepping a subscription service for iPhone, Mac and more. You know
0:07
honestly, I'm not really sure what to make of this story. I'm not really sure how I feel about it. I'd be curious to hear, do you want to just rent your iPhone and never own it
0:15
again? It actually kind of makes sense. Yeah, well, you want to discuss it or you want to
0:20
talk about it? I'll let you talk about it and then we can discuss it. Yeah, okay. So
0:25
this is according to Bloomberg. Yeah, reporter. We've hired, uh, what's his name again? Yeah
0:30
The germinator. He had a little something to say about your, about your headline, didn't
0:34
he? Yeah. A little something to say about that. Yeah. So this is Bloomberg. Okay. Uh
0:39
Apple Inc is working on a subscription service for the iPhone and other hardware products
0:43
a move that could make device ownership similar to paying a monthly app fee according to people
0:47
with knowledge of the matter. So basically they want to make buying a Mac or a iPhone
0:54
uh, more like leasing a car. You'd subscribe to a Mac studio for instance, like you subscribe
0:59
to iCloud storage or a, one of the Apple one services bundle. Um, let's see, we've got
1:05
some more details in this later in the story. Uh, again, citing anonymous sources, quote
1:10
the program would differ from an installment program in that the monthly charge wouldn't
1:14
be the price of the device split across 12 or 24 months. Rather it would be a yet to
1:19
be determined monthly fee that determined or that depends on which device the user chooses
1:24
Um, supposedly Apple's, you know, consider letting Harbor subscribers swap out their
1:28
devices for new models when they come out. Right. Uh, Peloton does something like this
1:33
They rent their bikes for 60 to a hundred bucks a month. You don't, you don't own it
1:37
Uh, and there's iPhone. Okay. So what I thought of immediately I read this is like they already
1:42
do this iPhone upgrade program, right? I realized it's not exactly the same thing
1:48
Yes, it is different because they, they split the payments of the iPhone upgrade over or
1:53
the cost over 12 to 24 months. So that, that's the, that's, that's the critical question
1:57
to me is if they are renting you your gear, so you're not going to own it. Does that mean
2:03
the payments are going to be cheaper or are they going to be more expensive? I guess I
2:07
don't really know how leases work cause if they would be cheaper, let's say you split the cost of the iPhone over 24 months, right? And your payment is $35 a month, but then
2:17
Apple comes out and says, Hey, you can rent this from us for 25 bucks a month and you'll
2:22
never own it and you can give it back whenever you want. That actually might be, that would
2:27
be something that I would probably be interested in it because I don't really care if I own
2:31
my iPhone. If you're going to give me a decent price to own it month per month, but if it's
2:35
going to be more expensive than just buying it outright, then why not just buy it outright and do the iPhone trade in thing? Get what I'm saying
2:42
Well, yeah, but I, I started thinking about it and it's like, okay, I love the iPhone
2:47
upgrade program, which, which Apple's been doing that I guess it's 2015, which in reading
2:51
this thing, I was like, what? It seems like just yesterday, but so I've been subscribing
2:55
to the iPhone since then, right? Every year I get a new one, whether I need it or not
3:00
and compare and contrast that with Apple watch. You know what I haven't upgraded? Apple watch
3:07
I bought a new one a couple of years ago, but then last year's update was like, eh
3:11
it's a little bit better. Yeah, a little bit better. But, uh, I didn't, I didn't spring
3:16
for it. But if I was on this program, I would have. Right. So I, it actually makes a lot
3:22
of sense to me. Like if people sign up, then they're hooked. They're always going to have
3:26
the latest, greatest thing. Uh, it would also, if you think about it, you would eliminate
3:30
these things like, oh, my Apple watch battery is just really dead now after two years because
3:34
you'd be trading it in and, and you'd, you'd constantly have the latest, greatest, you'd
3:39
you'd constantly have a new thing. Apple can refurbish things like they love to do. Uh
3:43
I would absolutely sign up for it. I mean, even more so than a car, I think a computer
3:49
after you know, four or five years is, you know, like you, you really should upgrade
3:54
Right. Yeah. I mean that's the thing with car leases. You always go, oh well geez. You
3:59
know, I, I've always looked at that as like, well that's, that's for rich people, but it's
4:04
also, it's a way to have a car that constantly works, you know? And at the end of it, I mean
4:10
after, I mean I've had my truck for 20 years, it's probably hardly worth anything. Well
4:16
until the great crisis that we're in right now. But uh, otherwise it would hardly be
4:19
worth anything. Um, you start holding onto a computer for much longer than a few years
4:26
and it's like, eh, you really should upgrade. Being able to swap out a Mac book every year
4:31
you'd always have a fresh battery. You'd always have the latest things. It'd be awesome
4:36
I don't know if I would do this for a Mac. I think I'd be more inclined to do it for an iPhone because I want the iPhone every year, the newest iPhone every year. And I
4:42
think a lot of people are kind of in that same boat. Well actually, maybe not. Maybe
4:46
it's just us. We, we upgrade our iPhones every year and there are a lot of people who keep
4:50
their phones for like three, four years. I kind of wonder like how many people actually
4:53
do upgrade every year. But again, I take it back to the key question. If it's, if it's
4:58
not going to be the same price or less, if it's not gonna be less than the price we already
5:02
pay for the installment plan, then what's the point of this? It doesn't make any sense
5:07
at all. It has to be less. Mmm, I don't think it is less. In fact, I mean the iPhone upgrade
5:12
program you're paying a little bit more because you uh, it includes AppleCare Plus. Yeah
5:19
So you know, I mean iPhone 13 Pro I think is $54.95 a month or something like that
5:26
which we say it out loud, that's kind of a lot of money to pay every month to be able to use a phone. But on the other hand, like I said, I, I've always got the new one. I
5:36
don't have to worry about it and I don't have to, you know, deal with, oh, it's been three
5:41
years and now my battery life is down to 80% and you know, I, I don't know. I, I think
5:47
this would be a very, I would do it and I bet you it'll be pretty similar to the price
5:51
of, of buying it outright, you know? Yeah. Zach Hicks from the chat, welcome back. Zach
5:58
Hicks, where have you been my friend? Okay. Zach Hicks from the chat is saying, I wonder
6:02
if renting one means we don't have to pay the sales tax up front every year like we do now, which it, it probably would mean that. So you would, they would just send you the
6:10
phone and then there'd probably be some kind of fee. They're going to get you on some kind
6:14
of fee right up front. But actually maybe not, it's apple, maybe not. But then you'd
6:18
pay your sale tax on the rental fee every month. And so yeah, you wouldn't have to pay that huge fee every single month. Again, I know I'm beating a dead horse here, but we've
6:27
already said this. The key is what's the difference between this rental program that they're working
6:32
on and the apple installment plan? It kind of seems like they're really too similar for
6:36
both to exist. And so I don't know if apple would get rid of the current program they
6:42
have where you pay the phone and then they let you trade it in and then you get your
6:47
new phone. Like maybe this would replace that. That's that, that kind of makes sense to me
6:52
And then if you want to have a payment plan for a phone that you own, you can, but you don't get to trade it in. The phone is just yours. I'm not saying that's what they're
6:58
going to do, but that, but it would seem odd to me to have the rental hardware rental plan
7:03
in place and then also the, the installment plan in place because they seem like they're
7:07
pretty much exactly the same thing. Unless again, unless and I hope this is what they
7:11
do. They say, you know what? You can rent the phone from us. Like if you want to buy
7:15
it, it's 45 bucks a month. If you rent it from us, it's only 34 a month and you can
7:21
just pay that 34 a month into perpetuity. As long as you own the phone, you just keep
7:25
paying apple. And so it's a little bit lower. It feels like it costs less, but if you keep
7:30
it for two or three years, you're actually paying them more. That seems like the way
7:34
to make this work. Well, I think the real strength of it is getting people to upgrade every single year, motivating
7:42
people to do it when there's not that much difference. I mean, there's not that much difference in last year's iPhone and this year's crappier color, maybe
7:50
Especially, especially next year's iPhone. And this one, as it turns out, it may not
7:56
be nearly as many differences as we had previously thought there might've been, which leads us
8:02
into our next story here, Lewis
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