iPhone Hardware ‘Subscription’ Service Project Reportedly Scrapped by Apple

Apple has scrapped a challenge to arrange a brand new {hardware} ‘subscription’ service for the iPhone, based on a report. The purported iPhone {hardware} subscription programme was in growth for at the least two years, and was designed to permit prospects to maintain upgrading to a brand new mannequin yearly, whereas guaranteeing a gradual stream of income for the Cupertino firm. The agency’s Apple Pay division was reportedly answerable for the challenge, alongside a ‘pay later’ programme that was additionally scrapped.

iPhone Subscription Service Was in Development Since 2022

Bloomberg’s Mark Gurman reports that Apple has stopped efforts geared toward launching an iPhone {hardware} subscription service — a challenge geared toward providing a brand new iPhone mannequin to prospects who paid an annual subscription payment to the corporate to get entry to the most recent {hardware} from the corporate.

The challenge confronted a number of delays because it was began two years in the past — it was anticipated to be launched by the top of 2022, however a number of setbacks resulted within the service being delayed by greater than a yr, based on the publication.

The firm was additionally reportedly involved that the challenge would face scrutiny from the Consumer Financial Protection Bureau (CFPB) that beforehand acknowledged corporations providing ‘pay later’ companies must adhere to rules that utilized to corporations like Visa and Mastercard.

Apple already provides an ‘iPhone Upgrade Program’ within the US that permits customers to pay for a brand new iPhone over two years, and the now-scrapped iPhone subscription challenge was anticipated to switch this programme, as per the report.

The iPhone is already the biggest contributor to Apple’s income, making up simply over half of all of its gross sales within the earlier monetary yr, based on firm reviews. A subscription programme might have ensured a gradual circulate of income for the iPhone maker, whereas protecting prospects from switching to different smartphone manufacturers.

This is the second payment-related challenge from Apple to be shuttered in 2024. In June, Apple introduced that it was winding down Pay Later, which was created in partnership with Goldman Sachs and Mastercard to rival US fintech Affirm. Pay Later was launched a yr in the past and allowed prospects to make a purchase order price as much as $1,000 (roughly Rs. 85,100) and pay it off over 4 instalments. Apple might nonetheless deliver again its iPhone {hardware} subscription challenge by working with a brand new accomplice, based on the report.