“The iWatch would achieve faster, more extensive mass adoption were it to be subsidized,” Bold Investor writes for Seeking Alpha. “Although Apple estimates that subsidization now accounts for “only” about a quarter of iPhone sales, subsidization was even more crucial in the iPhone’s mass adoption early on. After all, the iPhone has always cost a pretty penny, and if some consumers do not notice this, this fact can be attributed entirely to carrier subsidies.”
“Let’s assume for the sake of argument that Apple introduces a wearable that has multiple, well-executed capabilities involving advanced sensors, as suggested by Apple’s recent ‘hiring spree’ in the area of medical technology and sensors,” Bold Investor writes. “Such features are likely to include non-invasive measurement of glucose, heart rate, blood pressure and respiration. Let’s also suppose that the iWatch will include something unexpected or difficult to execute, like the ability to contact emergency services if the user needs an ambulance. Suppose the iWatch is something along these lines: who might subsidize such a device?”
Let us consider three possible sources of iWatch subsidies:
1. Insurance Providers
2. Pharmaceutical Companies
3. The Federal Government
Read more in the full article here.
No one. Subsidies will fall by the way side as we move along. Profit gouging by the likes OS Apple Inc. are coming to an end.
Ha ha! Subsidised! Hilarious!
Don’t need nary iwatch. Haven’t worn a watch in many years. Maybe enough people would want an iwatch, but not me.
If it can’t hold a charge for at least a week, it will FAIL.
Why a week? Few if any of my devices (if used) hold a charge anywhere near that long.
Why? Because today’s watches can go a year.
As it stands, I’m getting damn tired of plugging in both my cellphones (plus iPad, etc) nightly. My thought are that I want an inductive pad that I can simply lay devices on (or next to).
A week is total overkill. I’ll take my watch off at night and charge it like I do my iPhone and iPad. If it lasts reliable a full day, that’s good enough, while 2 days would be great for when I might be traveling or have forgotten to charge. Anything more than that, and it’s too much resulting in sacrifices based on today’s technology.
Me. (At least one.)
I think we should put this “subsidization” buzzword to rest for good. It’s become a euphemism for deferred loan. The carrier or seller is not absorbing any of the cost to sell it to you, they’re giving you a loan to buy it.
Early on AT&T subsidized the iPhone, charging the customer the $200 up front fee, and paying Apple the rest of the price in the background, making up the subsidization cost over the next two years on the mandatory plan, which included both calls and data. If you didn’t replace the two year old iPhone down the road, you still continued to pay the contract price indefinitely, so there was a definite incentive to replace it regularly.
In today’s environment, the call/data portion has been separated from the cost of the phone, so you now get an add-on to the service cost if you want to pay the phone off over the contract period. So, it’s no longer a subsidy, it’s a loan, pure and simple. That’s why I’ll be paying full price up front for my next iPhone.
If the iWhatever is sold at a discounted price for a contracted period, you can be sure it’s simply a deferred payment loan, much like purchasing a TV with a credit card with zero percent interest for x months. Don’t get me wrong, I think that’s a good thing, but it’s not a subsidy. You’ll be paying the full price, at least, over the contract period.
I don’t see any incentive for AT&T, etc. to subsidize (or finance) your iWatch purchase. It’s not going to be a separate mobile service contract or device, so why would they want to subsidize it unless they made money (interest) on the financing. But it’s not like AT&T could cut off service to your iWatch if you stopped making your payments, because that wouldn’t be on the plan (your iPhone would be, of course).
While this direct premise of this article is off the mark, it does rise an interesting idea. What if an insurance company offered you substantial discount on medical insurance provided you wear and submit reports from a device like the imagined iWatch. At HP we get a $100 credit each year for filling out long surveys relating to medical information. This would be a big leap from that of course, but perhaps the true customer of wearables could me people who want to monitor you.
Insurance companies have zero financial incentive to subsidize anything. At most, they will say that if YOU buy the iWatch and report your findings, you MAY qualify for a health insurance discount. Or you MAY receive a bump up in premium once it reports back your true eating habits.
What’s is like to work for a once-great company that’s floundering about trying to survive on peddling overpriced printer ink after selling its soul to Microsoft?
Well I took a package and left in 2008,was a great 15 years, incredible people, I learned a lot, made good deal of money off my stock options and still benefiting from the benefits programs. I now own all Apple products and Epson 24″ printer, if that tells you anything.
The iPod wasn’t subsidized, and neither is the iPad (there have been a few promotions I believe from Verizon, but mostly no subsidization).
There’s no need to subsidize the iWatch. Apple doesn’t need to drive early massive adoption. The iPhone came into a very different market — U.S. consumers were used to getting a new phone for free or fairly inexpensively due to carrier subsidization. With a new and very different product, Apple had to play the subsidization game to boost iPhone sales before its competition was able to copy it.
And don’t forget, the first iPhone wasn’t subsidized for a year.
Either the device will be provided via insurance with the cost rolled into the plan or the device will have to be purchased outright. The fine for non compliance is $500 first offense. Second offense is a date with ISIS.
Why subsidize it? And by the way… the “iWatch” (like the iPhone 6) hasn’t even been announced.
Phones aren’t subsidized. You pay for the full price of the phone (and then some) over the lifetime of your contract.
If the iWatch is designed to be integrated with the smart locks so we can forget about the keys that would be a good reason to buy one.
If Apple’s wearable is as well-designed as most of their past new products, I’ll buy one.
IOS is getting old even with all the Android copying. The watch will be the same usual Apple copying of existing products.