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Tim Cook hints that handset subscriptions could one day be a thing

Tim Cook hints that handset subscriptions could one day be a thing

This man might want to sell you iPhones on subscription. Maybe. One day. Possibly. IF YOU’RE A FULLY paid-up member of the Apple fanclub, you’ll have a number of direct debits coming out of your account each month, keeping you well-nourished with news, games and MOR television.  But CNBC thinks Apple may one day try

This man might want to sell you iPhones on subscription. Maybe. One day. Possibly.

IF YOU’RE A FULLY paid-up member of the Apple fanclub, you’ll have a number of direct debits coming out of your account each month, keeping you well-nourished with news, games and MOR television

But CNBC thinks Apple may one day try to push that model on to hardware, and that Tim Cook was “laying the groundwork” for this on the company’s Q4 earnings call with investors.

The Apple CEO was asked about the idea of an Amazon Prime-style subscription for hardware upgrades to boost subscription revenue in the face of stagnating phone sales. This was his response: 

“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. So to some degree that exists today.” He then went on to say that he believes this kind of approach “will grow in the future to larger numbers.” 

CNBC notes that Cook didn’t “shoot down the idea” which isn’t exactly the same as endorsing it. It’s not a good look for the CEO to ridicule callers’ views on investment calls – just ask Elon Musk – so it could just be viewed as a polite response to a question rather than an insight into future plans.

Still, it’s pretty clear that Apple likes it when people pay in instalments, and why wouldn’t it? A £9.99 recurring payment is much easier to hide in a bank statement than a £1,999 iPhone. “We’re cognisant 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, when talking about financing. 

Maybe it’s not quite ready to move that into a full iPhone subscription bundle, but with Services being one area where Apple is going great guns at the moment, you certainly can’t rule it out. µ

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Susan E. Lopez
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