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- Hacker News
- So they're going to subtract the residual from the price and divide that by some term, just like leasing a car. Doesn't seem like a bad way to get a phone and in the end, they just automatically own the residual instead of buying it from you. It seems like a more predicable way to do the same thing most people are already doing.by IAmGraydon
- I think "most people" have been shifting towards longer than 24-month replacement cycles. Leasing with a fixed end is probably predicted in their financial models to do a better job of getting more people onto a strict 24 month cycle. Nobody will want to actually buy out their lease on a 2-year-old phone, so they'll turn it in and lease another one, so Apple can throw it into the shredder[1] and show an additional sale on their books.
[1] https://www.ifixit.com/News/94386/the-truth-about-apples-fre...
by xp84 - So this new one seems like hardware-as-a-service subscription, the hardware is basically rented out, and since everything is linked to apple account it’s easier to lock it remotely if you don’t pay that month. They are probably planning to increase the prices and are introducing this model so it looks less of a payment method, except you don’t even own it.by tamimio
- Holy hell--you can rent a 32GB M5 MacBook Air for $33 a month.
You can stick that in your closet for one hell of an agent playground.
A standard $33 server has trash specs by comparison.
by fny - A shared vps with 8 core 9950x3d and 32gb of ram is twice thatby TiredOfLife
- Seems solid. Though it’ll have to be mostly idle. The air doesn’t dissipate heat all that wellby Havoc
- Makes sense they discontinued it given that the last 5 iphones have been almost exactly the same
- Yeah a 3-4 year cadence seems optimal now
Esp if you can swing a battery replacement at 2 years
by Havoc - Hey that's not fair, there has been one actually useful "innovation" -- switching to USB-C like the rest of the world has been using for 10 years. Literally nothing has made me feel the slightest craving for a new iPhone since getting my 15 Pro Max.by xp84
- Indeed. I used to be on the upgrade program so I could upgrade every year, but decided to skip the 16 and keep my 15 until the 17 came out.
Even if you are upgrading every single year, it works out roughly the same to just buy every phone outright and then trade in last year's model -- you typically get ~half your purchase price back as trade-in value after a year anyway.
by meatmanek - 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 - Man, the concept of leasing a phone is grim. The way hardware gets locked down these days, it feels like you never really own it in the first place. Leasing makes it explicit: you don't.
You'll own nothing and you'll feel weird about it.
by Retr0id - Additionally, the loan program was administered by Citizens Bank, not Apple.by bdcravens
- So essentially 2 years worth of payments, with a reasonable monthly payment, will not be enough to buy an apple device.by whatever1
- More tricks to hide rising prices across the board.
Looks like a recession indicator to me.
by 999900000999 - Yes, this appears to be entirely about raising the price of iPhones without raising the cost of iPhones. Most people don’t buy it out right so they need a way to ease the prices raised by keeping the monthly payments around the same. The difference is you have to return the phone at the end instead of owning it.
- > and no longer includes AppleCare+ by default.
On the one hand that gives users an option.
On the other hand, that is a way to hide a price increase. Also, those doing this are almost obliged to take AppleCare, as (https://www.apple.com/shop/apple-upgrade):
“What do I do if my device gets lost or is stolen?
If you have AppleCare+ Theft and Loss for your iPhone, iPad, or Apple Watch, you can file a claim at mysupport.apple.com/theftandloss.
If you don't have AppleCare+ Theft and Loss coverage and your device is stolen or lost, you'll need to close out your lease by paying the early termination fee or choose to pay the purchase option fee (plus any applicable taxes and fees). You can do that at an Apple Store, or through the Klarna app. You can then start a new lease with Apple Upgrade, finance with Apple, or buy your next device with a one-time payment.
You will continue to be charged your monthly lease payments until you either pay the early termination fee or purchase option fee. If you take no action, Klarna will continue to charge you your monthly lease payment through the extension period, and you will be charged the purchase option fee through Klarna.”
by Someone - 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 big distinction is whether the lease/loan ends with the requirement to pay a lump sum or not.
Your monthly payments stopping and you own a device is a world apart from your ability to pay monthly ends, and, unless you can find $x hundred dollars, you need to roll onto a new monthly lease.
Mathematically there might not be much in it from a $in/out perspective, but for people who don’t have large disposable incomes the reality is they are vastly different
by rurifjciri - 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 - Do family plans require them to be postpaid?by electriclove
- > I know a lot of people use postpaid, but I can't understand why.
Two reasons: data caps and device cost.
People want iPhones but they cost $1000 outright which isn't a small amount of cash these days so they roll the cost of the device into their monthly bill. The average consumer also doesn't understand how mobile data versus 802.11 works - their kid doesn't activate Wi-Fi on their phone or download anything, they see a large number with "GB" on the end, and they pay whatever is necessary to keep the Instagram scrolling and Disney+ flowing.
Buying an iPhone outright, flipping the old one every few years (they hold their value well) and using a $30 a month 10GB plan is doable if you have money and are savvy enough to download podcasts and use your home's AP for data.
Carriers certainly aren't incentivized to educate consumers better since they'd rather make money on device installments and milk them for hundreds of dollars a month because they "have a large family and need a lot of data". Home broadband marketing is even worse - why a family of four "needs" 500 Mbps down is absolutely beyond me. In an ideal society this type of consumer literacy would be taught in school but I'm not holding my breath.
by alexjplant - Apple card installment isn't allowed on EPP stores, right? And you lose credit card extended warranty coverage, which is worth 5% of purchase price easily.by pishpash
- I'm on Verizon postpaid, 4 lines on Unlimited Plus for $31/line. That's hard to beat pre-paid for comparable service. Yes, I have to threaten to leave Verizon once a year to get them to add a bunch of customer loyalty discounts, but that's not less work than switching pre-paid carriers to chase deals.
I subscribe to /r/NoContract/ so I have a pretty good idea what's out there.
Visible+ is a comparable pre-paid plan, it's $29/mo but that's a teaser rate and to keep it past one year, you'd have to port out and port back in for whatever deal they have in one year. The normal price is $35/mo, so I'm beating that. (Visible would also mean managing 4 separate accounts since they have no multi-line plans.)
Total Wireless is a bit cheaper ($26/mo) but I keep reading terrifying customer service issues with them including most recently losing number during the porting process.
Aside, I briefly used US Mobile earlier this year to port a VoIP line to Google Voice (GV will only port-in mobile numbers). US Mobile's customer service is exceptional. Would recommend them heartily for pre-paid service. But they don't currently beat what I'm getting from Verizon post-paid. I'd consider them if I can't keep my loyalty discounts next year.
by js2 - 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
- Haha!by lysace
- I do not speak for anyone else, but whenever I encounter a phrase resembling "an entirely new payment option that we think you’ll love" I stop reading and throw the whole thing in the cognitive trash.
Do not presume to anticipate my love, drone.
by RunSet - Seeing as Apple is sunsetting a program that is far superior as a consumer, the two are not unrelated.by dsl
- 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 - “Financially challenged” people never paid for their phones with cash
They were probably using credit cards at 29% to buy the exact same phones that are now 0%
Net net it’s a win
by r0fl