It’s possible that Apple may start leasing iPhones. Here’s Why It’s a Smart Move

It's possible that Apple may start leasing iPhones
Apple’s iPhone 13 Pro.
James Martin/CNET

You might soon be able to upgrade your iPhones using the same subscription model that you use to pay for Netflix, Amazon Prime, and a slew of other services. According to Bloomberg, Apple is working on a subscription model that would allow users to pay a monthly price for an iPhone rather than purchasing it outright or in instalments.

Let me state upfront that I believe this concept has the potential to transform the tech industry. I know, the concept of Apple changing the tech industry is already making me roll my eyes. But bear with me.

If the idea takes out, leasing iPhones instead of selling them might make a significant dent in the tech industry’s enormous mountain of e-waste.

Apple has sold enough iPhones to circle the globe more than a dozen times since debuting the iPhone in 2007. And Apple’s enormous success, like that of numerous other computer and gadget companies, has come at a steep price, measured in tonnes of aluminium, cobalt, copper, glass, gold, lithium, and a variety of other raw materials used to create the device you’re reading on right now.

Apple might use a leasing programme to get closer to its aim of creating an iPhone made entirely of recyclable materials while also persuading users to update their phones every year. More subscriptions would mean new cash for Apple, as well as the possibility of more iPhones made from recycled materials.

There are other reasons why such a programme might be beneficial. Fans would be able to switch to the latest model without having to pay the hefty lump-sum rates Apple charges for phones like the $699 iPhone 13 Mini or $1,099 Pro Max if Apple leased iPhones instead of selling them. Apple’s iPhone subscription service would almost certainly improve revenue from two of its most crucial business segments: iPhone revenue and digital services like iCloud and Apple Tv.

Even yet, the concept raises a lot of questions.

We don’t know how much such a programme would cost Apple. So deciding if anything is “worth it” is difficult until a price is set. It’s also unclear what will happen at the end of the lease time. (Apple did not react to CNET’s request for comment on Bloomberg’s claim right away.)

Between trade-in offers, carrier subsidies, and Apple’s existing iPhone upgrade programme, there are already a bewildering variety of purchase possibilities. To fully catch on with consumers, Apple’s plan would have to be significantly more economical than these alternative phone payment options.

Furthermore, people are already overburdened by the increasing number of monthly subscriptions, which include anything from streaming services to cell phone contracts to cloud storage. Without looking through my credit card statements, I can immediately think of ten different digital services on which I am currently enrolled. Are we all ready to add another to the list?

An iPhone subscription could make it more common to recycle your iPhone

An iPhones subscription could make it more common to recycle your iPhone
Apple’s Daisy robot is designed to extract parts from recycled iPhones.
James Martin/CNET

Apple has been outspoken about its aim to minimise its carbon footprint for several years. An iPhone subscription plan appears to be the logical next step in some ways. According to the source, the service could include the opportunity to exchange out outdated devices for newer models, thus giving iPhone buyers even another reason to recycle their old iPhones through Apple.

In recent years, Apple has made significant progress toward its eco-friendly goals. Liam, the company’s first robot designed to deconstruct iPhones and reuse their parts, was unveiled in 2016, and a new robot, Daisy, was announced in 2018. Apple discontinued including chargers and wired headphones in its iPhone package with the iPhone 12 to decrease waste, a move Samsung imitated. Apple’s vow to become carbon neutral by 2030 is one of the company’s most ambitious goals.

Apple also aims to make iPhones without having to find new materials in the long run. On that front, things are already moving forward. The main logic board plating of the iPhone 13 is made entirely of 100 per cent certified recycled gold, making it the first Apple product to do so. Apple has officially announced that the upcoming iPhone SE will be made of low-carbon aluminium.

Apple is investing in the behind-the-scenes work that goes into recycling iPhones with such investments. Apple could make its green initiatives a more important part of the iPhone purchase experience by creating an iPhone subscription plan. For years, Apple has publicised its trade-in deals and iPhone upgrading programme, but a subscription service would make it a more fundamental component of Apple’s iPhone business model.

Despite the fact that Apple and other shops have trade-in schemes, global recycling rates have been low. According to a January 2019 research from the World Economic Forum and Platform for Accelerating the Circular Economy, barely 20% of electronic waste is officially registered and adequately collected. This scheme might help make iPhone trade-ins a common industry practice rather than merely a way to save money, similar to how you’d trade in your car when your lease is up.

Aside from maybe assisting Apple in reducing waste, an iPhone subscription service may be more cost-effective. Apple, wireless providers, and stores all offer significant trade-in discounts and monthly payment arrangements. However, unlike other payment alternatives, this new option would not spread the cost of the device over 12 or 24 months, according to Bloomberg.

Customers would instead be charged a flat fee that would vary based on the gadget. As a result, if customers don’t have to fund the entire cost of the gadget, a subscription service may end up being less expensive than current options. However, given this is based on Bloomberg’s report rather than the official Apple word, we can’t be certain.

The iPhone 13 Pro costs $999, or $27 to $41 a month depending on whether you sign a 24-month or 36-month contract with Apple or wireless carriers. The older iPhone 11, which normally starts at $499, or roughly $14 per month, is on the lower end of the spectrum. When you trade in your phone or sign up for a new service plan, Apple, carriers, and shops frequently give you a discount.

Apple also offers an iPhone upgrade plan that allows users to acquire a new iPhone every year after paying for it over the course of 12 months. It costs $35.33 a month and comes with AppleCare Plus protection.

There are, of course, other advantages for Apple. Because the iPhone is Apple’s most profitable product, any new items that have the potential to boost iPhone growth will be welcomed by Wall Street. It’s especially vital to find innovative strategies to encourage iPhone upgrades since that people are holding on to older phones for longer periods of time.

More choices aren’t always a good thing

More choices aren't always a good thing

While paying for your iPhone on a monthly basis has the potential to be more environmentally friendly and cost-effective, it also has the potential to make things more confusing. With so many upgrade possibilities, determining whether or not subscribing to your iPhone is genuinely the best deal can be tricky.

Carriers already provide aggressive trade-in deals to woo new consumers and keep current ones, especially during iPhone launch season. Carriers like AT&T and Verizon offered to cover the base cost for some models of Apple’s newest iPhone during its introduction, emphasising the importance of such deals. Customers must, however, trade in their old phones and enrol on the appropriate plan in order to qualify for these reductions.

It wouldn’t be shocking to see carriers collaborate with Apple or develop new methods to compete if Apple introduces an attractive iPhone subscription package. As a customer, this may imply additional research and fine print to go through in order to identify the most cost-effective alternative.

And, as previously said, there’s the question of whether the sheer quantity of subscription services accessible today has already overloaded individuals. In the 15th edition of Deloitte’s digital media trends research, which polled 2,009 US consumers in February 2021, 53 per cent of respondents expressed dissatisfaction with the number of services they had to subscribe to in order to obtain the material they want. Customers may not want to begin subscribing to their iPhones as well.

Despite the progress Apple has achieved in its green endeavours, such steps come after the company has been chastised for years over its iPhones and other products’ repairability. Apple only recently launched a service in November that allows users to obtain parts from the firm to fix their own devices.

There are numerous questions that must be addressed. We have no idea how much such a service may cost, or whether it will ever launch. However, it would provide Apple with an opportunity to demonstrate how essential repurposing iPhones has become, not just in terms of the manufacturing process, but also in terms of the sales process.

Also Read:

Not interested in the iPhone SE? These Upcoming Phones Look Fantastic in 2022

Apple is updating the iPhone SE, but the future of the iPhone Mini appears to be in doubt.

Source Link

Leave a Reply

Your email address will not be published.