Apple may be about to revive a plan to offer its devices through a subscription program. Most iPhone, Mac, iPad and Apple Watch models would be available through the Apple Upgrade service, which could go live as early as July 28.
The company reportedly previously considered a hardware subscription service before abandoning the idea in 2024. At the time, it was reported that Apple ultimately abandoned the plans due to concerns over financial oversight. According to Bloombergthe company partners with Klarna for the Apple Upgrade program. The publication states that this partnership will allow Apple to offer hardware through a subscription program “without taking financial responsibility.” The companies are already working together, as Apple has offered Klarna as a buy now, pay later option in Apple Pay since 2024.
Apple Upgrade should offer customers some flexibility, but with additional fees in some cases. For example, they will apparently be able to upgrade their device to a newer model. Alternatively, it is expected that they can keep the device after the rental period or return it. They would also be able to refund the device earlier during the rental period. Leases are expected to last 24 months for iPhones and Apple Watches, and 36 months for iPads and Macs. A soft credit check will be required, according to the report.
Perhaps to streamline its payment plans, the company could stop new sign-ups for the iPhone Upgrade Program and standard financing options. The report states that Apple Upgrade will not support AppleCare, while devices such as the iPhone 16, MacBook Neo, Apple Watch SE, and base iPad will not be eligible.
It is believed that Apple Upgrade will initially be available in the United States. It’s unclear whether Apple will immediately offer its subscription plan in other markets.
News of the Apple Upgrade program comes shortly after the company raised prices on many devices by at least $100, up to a $1,300 increase in the case of the M3 Ultra Mac Studio. Apple is also expected to raise iPhone prices when it reveals this year’s lineup in the coming weeks.
Apple Upgrade could appear to mitigate some of these price increases by giving consumers a way to get a new device without a single hit to their wallet. This could help boost Apple’s sales following these increases and add more recurring revenue to the company’s bottom line, similar to how its services business is thriving. However, buy now, pay later programs often carry significant risks for consumers, such as higher fees for missed payments.
