Apple appears to have abandoned its subscription service plan for the iPhone. According to Bloomberg, this model, which was first brought to the agenda in 2022, could not be implemented due to complex problems such as Apple Pay Later, Apple’s “buy now, pay later” product.
This plan was intended to work similarly to existing payment options such as the iPhone Upgrade Program or Apple Card Monthly Installments. When purchasing a new phone or another Apple device with monthly payments, users would also have the option of renewing their devices without paying an additional fee. However, the difference with this method was that the payments would be managed directly through the Apple account, not to third-party organizations such as Citizen One or Goldman Sachs.
Apple predicted that thanks to this model, users would renew their devices more frequently and increase the company’s regular revenue stream. However, according to Bloomberg, the implementation of such a service could subject Apple to the same regulations as credit card companies. Apple chose to avoid such additional legal scrutiny.
Apple may want to preserve relationships with carriers on iPhone sales
Another reason for the cancellation of the subscription model is considered to be problems that may arise in Apple’s relations with operators. Currently, when users purchase an iPhone 16 from operators such as T-Mobile or Verizon, they can have their devices with monthly installment plans. Although technically different from a subscription, this form of payment offers a similar experience in practice. Apple’s direct subscription model could create a new dynamic in this field and complicate relations with operators.
Although Apple’s hardware subscription service has not been officially announced, this development shows that the company is re-evaluating its strategies in financial services. For example, Apple Pay Later was shut down in June 2024 and converted to credits available through Affirm with iOS 18. Additionally, the future of the Apple Card, which it launched in collaboration with Goldman Sachs, remains uncertain; The company is looking for a new partner for this service.
Such difficulties for Apple in financial services may lead the company to focus more on innovation in hardware and software. On the other hand, considering that such subscription models are becoming popular among technology companies, it is possible that Apple will return to this area in the future.