Apple abandoned iPhone subscription service: project shut down before launch

Apple has abruptly halted development of an iPhone subscription model that could have changed the way smartphones are purchased. The idea was to offer users a subscription that would allow them to get a new iPhone every year for a fixed monthly fee. However, according to sources familiar with the situation, Apple has decided to shut down the project before it is officially launched.

Apple has decided to shut down the project before it is officially launched.

The iPhone subscription: ambition and failure

The idea of an iPhone subscription service first surfaced in 2022. According to Bloomberg, Apple had planned to launch the service later that year, but technical issues, including software bugs, forced the company to postpone the launch indefinitely. It has now been revealed that the team working on the project has been disbanded and its members transferred to other areas.

According to plans, the subscription would have allowed customers to pay a monthly fee with which they could receive a new iPhone model each year. Billing and device credits were to be handled internally, and payment would be tied to an Apple account used for App Store purchases and subscriptions to other services.

According to the plans.

The project was overseen by the Apple Pay group, which previously also ran a buy-now-pay-later initiative. That service, which allowed customers to pay for purchases in installments, has also been shut down, and Apple is now offering third-party installment plans to customers.

Why did Apple drop the subscription service?”

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iPhone is Apple’s key product, accounting for more than half of the company’s annual revenue. A subscription service could have boosted smartphone sales while creating a new source of recurring revenue, incentivizing users to stay in Apple’s ecosystem. But implementation complexities, including technical difficulties and organizational issues, have forced the company to rethink its plans.

Subscription service

Problems accompanied the project throughout its development. Even subscription testing among the Apple Pay, App Store, and online store teams didn’t yield conclusive results. As a result, the company chose to focus on other initiatives.

What’s next?

Although Apple has dropped the iPhone subscription service, the company is likely to step up promotion of its existing device upgrade program, the iPhone Upgrade Program. This service allows you to split the cost of an iPhone over two years, with the option to exchange the device for a new model after 12 months. The program is already popular with the brand’s loyal customer base.

The program is already popular among the brand’s loyal customers.

The move away from the subscription model may also signal Apple’s desire to minimize risk and focus on proven solutions. In a highly competitive technology market, the company may have found the project too ambitious and difficult to implement.

Apple’s move away from the subscription model could also be a sign of Apple’s desire to minimize risk and focus on proven solutions.

Closure

Subscription on the iPhone could have been a new word in the world of mobile devices, but Apple has decided to shelve the idea. The main reasons are implementation complexity, internal issues, and the company’s shifting priorities. It remains to be seen whether Apple will return to developing such services in the future, but it’s clear that the company will continue to look for ways to strengthen its ecosystem and increase revenue.