Apple's ( $AAPL) rumoured hardware subscription program could increase company's userbase and revenue, says GlobalData
April 27, 2022 (Investorideas.com Newswire) If given the right price point, Apple's rumoured iPhone subscription program could make its devices more affordable and reduce device ownership cycles allowing the company to reuse hardware components and expand its reach to new user groups, says GlobalData, a leading data and analytics company.
Apple is rumoured to offer an iPhone subscription program this fall that will allow users to lease its devices. The program will enable them to experience the device without a heavy upfront investment or commitment to a device payment plan. Hardware leasing programs are not a novelty in the US. Sprint launched a leasing program dubbed Sprint Flex in 2017, which was retired by T-Mobile in August 2021.
Apple's current upgrade program allows its users to pay for devices in 24 monthly instalments. Device instalment options from wireless carriers also work on a similar principle. The main difference between the rumoured subscription program and device financing programs is that with the latter, users can own the device at the end of the payment plan while with the subscription program, a customer would only lease their device for a limited amount of time and never truly own it.
Deepa Karthikeyan, Technology Analyst at GlobalData, comments: "The success of Apple's rumoured subscription program would ultimately depend on how it compares against existing device financing options, both from wireless carriers and Apple itself where the cost of the device is spread over 24 or 36 months. It is important to note that current promotional deals from carriers offer users up to $1,000 if they trade in a device or switch carriers, which acts as an incentive for device ownership. Like everything else, the program's cost and time commitment structure would determine its uptake rate."
The subscription scheme would also create a viable path for many users to own the latest iPhone model each year. The current reported upgrade cycle is three years.
Karthikeyan adds: "For Apple, a subscription hardware program will help bulk up its monthly recurring revenue share by potentially requiring customers to subscribe to its device protection and insurance plans."
For more information
To gain access to our latest press releases: GlobalData Media Centre
Analysts available for comment. Please contact the GlobalData Press Office:
EMEA & Americas: +44 (0)207 832 4399
Asia-Pacific: +91 40 6616 6809
Notes to Editors
- Quotes provided by Deepa Karthikeyan, Technology Analyst at GlobalData
4,000 of the world's largest companies, including over 70% of FTSE 100 and 60% of Fortune 100 companies, make more timely and better business decisions thanks to GlobalData's unique data, expert analysis and innovative solutions, all in one platform. GlobalData's mission is to help our clients decode the future to be more successful and innovative across a range of industries, including the healthcare, consumer, retail, financial, technology and professional services sectors.
This news is published on the Investorideas.com Newswire - a global digital news source for investors and business leaders
Disclaimer/Disclosure: Investorideas.com is a digital publisher of third party sourced news, articles and equity research as well as creates original content, including video, interviews and articles. Original content created by investorideas is protected by copyright laws other than syndication rights. Our site does not make recommendations for purchases or sale of stocks, services or products. Nothing on our sites should be construed as an offer or solicitation to buy or sell products or securities. All investing involves risk and possible losses. This site is currently compensated for news publication and distribution, social media and marketing, content creation and more. Disclosure is posted for each compensated news release, content published /created if required but otherwise the news was not compensated for and was published for the sole interest of our readers and followers. Contact management and IR of each company directly regarding specific questions.
More disclaimer info: https://www.investorideas.com/About/Disclaimer.asp Learn more about publishing your news release and our other news services on the Investorideas.com newswire https://www.investorideas.com/News-Upload/ and tickertagstocknews.com