Apple could very well offer an Amazon Prime-like subscription where it would bundle hardware upgrades along with a subscription to its other services like iCloud storage, Apple Music, and Apple TV+.
When questioned by analyst Toni Sacconagi, Apple’s CEO said that the company already offers something like this in the form of the iPhone Upgrade Program. In a bid to make the Apple Card a more attractive proposition to its owners, Apple will soon start offering them 0% financing for 24 months on iPhone purchase. This is an addition to 3% cashback that Apple Card owners will be eligible for when they buy a new iPhone.
″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.”
The iPhone Upgrade Program has turned out to be a silent hit. During the conference call, Apple’s CFO Luca Maestri said that the trade-in program has grown fivefold compared to the last year.
“We also continued to see great results from our trade-in program with more than five times the iPhone trade-in volume we had a year ago,” Apple CFO Luca Maestri said.
Analysts have long claimed that Apple should launch a bundle subscription service. While it might not be immediately obvious, Apple is slowly and steadily doing the same thing. Right now, one might have to individually subscribe to iPhone Upgrade Program, Apple Music, iCloud storage, and other Apple services but over time, it is clear that Apple is working on a super-bundle allowing users to subscribe to multiple hardware and software services for a single monthly subscription fee.
With iPhone upgrade time only increasing, this move would prove to be beneficial for Apple as well as it would develop a recurring revenue stream this way.