The iPhone Upgrade Program is being replaced by Apple Upgrade

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• Hacker News
• Interesting decision. As far as I can tell, the iPhone Upgrade Program was structured like a loan where you owned the device but kept making payments. You then had the option to trade up to a new phone and add more months to the loan, or to pay out the remainder of the loan (24 months?)

  They’re discontinuing this and replacing it with Apple Upgrade, which is structured as a lease. Apple owns the device and you make payments. You either return the device or buy it out at the end.

  The distinction probably doesn’t matter much to the typical consumer, other than the final price differences. Some people have an emotional attachment to knowing they own the phone instead of leasing it (I’m emotionally attached to this position, however illogical) but in the end it comes down to having a device in your hand for a monthly payment.

  by Aurornis
• The iPhone Upgrade Program was a 24-month 0% financing program for iPhones. The replacement Apple Upgrade<https://www.apple.com/shop/apple-upgrade> is a leasing program that also covers iPads, Macs, and Apple Watches.

  Instead of automatically owning the device after making all payments, you can choose return/upgrade/buy it at the end of the lease. The new program is backed by Klarna instead of Citizens Bank, uses a soft credit check, and no longer includes AppleCare+ by default.

  The fact that the page is not particularly clear about any of this should tell you everything you need to know about this change.

  by acmnrs
• Seems like a good place to also mourn the canonical best iPhone financing method - the blissfully simple Apple Card payment plan. They got rid of it[1] (except if you're engaging in the postpaid carrier contract foolishness) in 2023, which coincidentally was the last time I felt the need to get a new iPhone.

  I know a lot of people use postpaid, but I can't understand why. I'd challenge anyone to justify that decision, given that the phone "deals" are rarely even much of a subsidy as opposed to a financing scheme that acts as a contract, and the plans cost about triple what I pay every month, for fewer features and equivalent at best priority and speeds.

  [1] https://9to5mac.com/2023/06/15/apple-card-financing-sim-free...

  by xp84
• I wonder what the reaction here would have been if Klarna had independently announced this program, instead of the current version which is Apple branded with a tiny “run by Klarna” in the footer.
  by paxys
• "If you’re leasing an iPhone, you’ll need to connect to AT&T, T-Mobile, or Verizon when you enroll."

  Damn, this is the dealbreaker for me.

  Leasing an unlocked iPhone and being able to use my current $25/mo MVNO of choice (US Mobile) may have actually tempted me (I currently buy outright and then tell myself I'll sell my current phone when I upgrade, but in reality I just have iPhone graveyard at home.)

  by _zie
• Well, Apple did just hit a 5 trillion market cap with a PE ratio of 41.

  With hardware prices increasing, selling financially challenged people on 'cheap' monthly payments seem like one way to keep the stock price pumped at these levels.

  I guess they are one of the good trillion corporations though?

  https://finance.yahoo.com/technology/article/apple-tops-5-tr...

  by user00005
• I'm not sure I understand all the hate in this thread.

  I had a friend who bought a new Mac every year, selling his old Mac. His calculation was that it was about the same price as keeping one Mac and upgrading every 5 years.

  I'd consider leasing a Mac through this program. I priced one out, with the options I chose it's $8149, lease for $177 (6372 for 3yrs, 8496 for 4yrs).

  Yes, at the end of those 3 years I don't have a mac, I have to keep paying, but I'd prefer a new Mac every 3yrs and it's just easier than trying to sell it for $1777. It doesn't seem like a bad deal to me, plenty of people lease cars. Plus, if you consider you can keep your moneny in interest earning account, then at 3% you'd end up with $2256

  I'm not saying that makes it a good deal for you, but I personally like the idea of not paying out $8149 day one, especially for something I know has a shelf life. I'm on an 2021 M1 Mac. It works great. But I've also tried to run 70b LLMs and run out of memory (64g), so I think about upgrading to 128g which, being Apple, I can only do by buying a new mac.

  by socalgal2
• The math for the new program is kinda perplexing, my guess is that they are hoping that most people just will send in the device and upgrade.

  If I am reading the FAQ here properly: https://www.apple.com/shop/apple-upgrade.

  > If you decide to buy the device, the purchase option fee is the list price minus any lease payments you’ve made minus any remaining discounts or trade-in credit. (excluding tax and any damage fees).

  Lets look at a couple examples:

  iPhone 17 pro max would be $1199 to buy (~1273 with tax) or $34.99 for 24 months totaling $839.76. So would cost 433.33 at the end of the lease to keep it

  The cheapest 16" MBP would be 2,999 to buy (3186.44 with tax) or $57.99 for 36 months (or 80.99 for 24 months). 2087.64 or 1943.76. So around ~1k to buy it at the end.

  It looks like you can keep making payments for 6 months to lower the buyout price a little bit.

  So worst case scenario this is a 3 and a half year interest free loan with a higher payment at the end.

  Seems not terrible? As long as you treat it as a loan and not a lease you can end at any point it seems fine and nothing really shady about it. You still have the option to own the device for the original cost.

  Other than the loss of the iPhone upgrade program and the yearly upgrades, am I missing something here? I guess the biggest thing is you likely can't just pay it off and be done with it if you had the money.

  by nerdjon