Apple lays the groundwork for an iPhone subscription

Apple CEO Tim Cook suggested that Apple is working on new ways to pay for iPhones on a monthly basis during a conference call with analysts on Wednesday.

Kif Leswing for CNBC:

Apple investors have speculated for years about the possibility that Apple could sell hardware, like the iPhone, on a subscription basis… Under the argument for an iPhone subscription, which some people call Apple Prime after the Amazon program of the same name, Apple would bundle hardware upgrades with services like iCloud storage or Apple TV+ content and hardware for a single monthly fee.

During Wednesday’s earnings call, when analyst Toni Sacconagi asked about the idea of a prime subscription, Apple CEO Tim Cook did not shoot down the idea. In fact, he suggested that something like it was already in effect. ″In terms of hardware as a service or as a bundle, if you will, there are customers today that essentially view the hardware like that because they’re on upgrade plans and so forth,” Cook said during an earnings call. “So to some degree that exists today.”

There’s also a new program, announced by Cook on Wednesday’s earnings call, that will give people who use the Goldman Sachs Apple Card free interest for 24 months on iPhone purchases… “We’re cognizant that there are lots of users out there that want a sort of a recurring payment like that and the receipt of new products on some sort of standard kind of basis and we’re committed to make that easier to do than perhaps it is today,” Cook said.

MacDailyNews Take: Of course, an Apple bundle is something we’ve been wanting for years:

We’d really like to see a way to pay for all of the Apple services we choose for one price. Give us a bunch of tick boxes and let us choose our combination of iCloud storage, Apple Music, iTunes Match, etc. and let us pay a single price for all of our choices.MacDailyNews, October 17, 2016

As soon as Apple launches their original content video service, an “Apple Prime” will make even more sense. — MacDailyNews, August 29, 2018

Apple could make a more compelling “Prime” bundle than even Amazon can offer because their original content sounds like it will be better and Apple Music + Apple News/Texture are unmatched. If they rolled some iCloud storage deal into it, it’d be tough to resist for many, many people!MacDailyNews, February 14, 2019

Hopefully, some sort of bundle option will also be available for us all to be able to the combine Apple services we want for a single fee, lower than the cost of subscribing to them à la carte. — MacDailyNews, March 25, 2019

Yes, please! We’ve long been hoping for some sort of an “Apple Prime” bundle option or options that will reward those of us who have multiple Apple subscriptions (Apple Music, Apple News+, iCloud storage, etc.). — MacDailyNews, October 7, 2019

As we wrote last month here and here:

$99 per month gets you an iPhone and every Apple service. Presented like that, it’d be insanely irresistible. And every “new to iPhone” customer will immediately and irrevocably be steeped in Apple’s Hotel California ecosystem… We bet if Apple offered iPhones along with services bundled into one monthly fee – offer tick boxes for Apple TV+, Apple News+, Apple Arcade, Apple Music, iCloud Storage, etc. – they’d have a winning sales strategy (Apple Prime) on their hands!


    1. True on one level, but used iPhones can realistically get refurbished and reused for up to 5 years. If returned to Apple for recycling at end of life, it gets done in a reasonably environmentally friendly manner, too.

      Cheap Androids on the other hand, which make up over 2/3 of the global smartphone market, ARE bad for the environment. They have no resale value, see no updates, fall apart within a year or two, and recycling is definitely done by the lowest bidder, sometimes in poor towns that can’t fend off big companies who don’t bother with pollution controls or workplace safety.

  1. This is a easy way for a company to claim revenue from customers that “fall asleep.” I’ve kind of “fallen asleep” with Netflix. I’ve kind of fallen asleep with my car/home insurance. That’s the nature of annuities and this is the annuity model.

    I lay back…take advantage of me. I don’t need a refresh and a price increase with each new iteration.

    There’s a “slime-element” to this kind of business. These kind of measures draw me away from my Apple favor.

    1. The “slime” element really only comes into play with companies like Comcast who 1) live off of a model where you get a lower introductory monthly price that silently shoots up after 12/24 months, and 2) make it fairly difficult for you to change or cancel your service. These characteristics are absent in the services provided by Netflix, Amazon, and Apple. I canceled my Netflix subscription a few months ago and it was a very straightforward process. Netflix is also fairly transparent about price increases.

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