Apple Working on iPhone Subscription Service, Could Launch by Year End: Mark Gurman

Apple's hardware subscription service has been in the works for a while and was made public after it surfaced in a Bloomberg article in March this year. A few months later, the same source now claims that Apple's hardware subscription service is currently undergoing testing and that it will be announced by the end of this year, or early next year. The subscription service will essentially let buyers subscribe to Apple hardware instead of purchasing them outright. Buyers will have to pay a monthly fee and can upgrade to a newer iPhone model when available.

In his Power On newsletter, Mark Gurman explains that the service once live is expected to function very differently compared to Apple's current iPhone Upgrade Programme, which basically lets buyers split the cost of an iPhone over 12-24 months. The new hardware subscription service will be quite different as subscribers to the same would have to pay a monthly fee (like subscribing to Apple Music) to use the device and can later upgrade to a new one; once a new model is available.

According to Gurman, Apple is still testing out its new hardware subscription service and working out how it will integrate its Apple One bundles with it. The source also claimed that its new service will launch either later this year, or next year and that Apple did not announce the service at its iPhone 14 launch, to “reduce launch day complexity”, as it would be an entirely different way to purchase an iPhone.

What remains to be seen is how many Apple's devices will be a part of this subscription service and whether this would extend to Apple's Mac ecosystem as well. Also critical is the pricing and the fine print that would divide the line between owning the devices or purely using them. Gurman in his newsletter also stated that subscription fee would also depend on “which device a user chooses.”

As per an earlier report, this new hardware subscription service is supposed to benefit Apple well as it is expected to rake in more money than the average selling price of an iPhone. This should work out well for Apple as it releases new versions of important devices year after year. The consumer benefits with a new and updated device at a lower cost and does not have to bear the entire cost of buying a new device in one go.