One of the many rumors around the upcoming iPhone 14 is a new way to pay for the device. With the current iPhone 13 costing upwards of £679/ $699 buying one outright is a significant outlay and a definite barrier to purchase.
Of course, there are already plenty of ways to get the iPhone without paying the full amount upfront. Phone networks in the UK have, for many years, offered the phones for a reduced cost – or even for free – as part of a monthly network charge. In the US this tends to be in the form of bill credits each month but the idea is essentially the same.
Apple also offers its iPhone Upgrade Program, which splits the full cost of the phone into 24 monthly payments and allows an upgrade after just 12 months, which will then extend the payments.
According to MacRumors, this year Apple could offer either a buy now, pay later (opens in new tab) feature or a dedicated iPhone subscription (opens in new tab). Potentially both. While these might not seem like a big step from the current offerings, they are slightly different.
The buy now, pay later is likely to split the cost of a handset into four parts – much like payment plans offered by the likes of Klarna and PayPal. Meanwhile, the subscription program is likely to be more of a monthly lease rather than a payment plan. This means that you are only ever renting the phone over the contract period rather than ever truly owning it.
There are potential benefits to a leasing-style subscription service. Firstly, the monthly cost is likely to be less than even the current upgrade program while still offering benefits such as early upgrades.
Where it could get interesting is if Apple was to package an iPhone subscription with its Apple One subscriptions. The current Individual Apple One subscription, which includes Apple Music, Apple TV+, Apple Arcade and iCloud+ costs £14.95/$14.95 a month. An iPhone subscription that cost around £40/$40 per month and included Apple One would be a big saving compared to buying Apple One and the upgrade program separately and could be a big win for Apple.
Buying an iPhone 14 Max, Pro or Pro Max would obviously cost more. However, as top streaming platforms such as YouTube TV and Hulu have proved with their live TV subscriptions, people are prepared to pay $65+ per month for their streaming, so why not for a phone and entertainment package.
The problem is, of course, that all those monthly subscriptions mount up. But if Apple is able to package it with its services, you could actually end up saving money.