It’s all about the AppleCare. I’ve used the upgrade program from the beginning. The issue with it from Apple is if I have an iPhone, iPad, MacBook I’m not gonna buy the $20/mo AppleCare.

They are also dumping a weird risk premium on the end user. I literally get a new phone every year with the upgrade program, there’s no way I’ll be doing that going forward, at least through the lease. I’ll just buy it with cash and wait for a deal.

> my guess is that they are hoping that most people just will send in the device and upgrade.

That's precisely why they set it up this way, honestly leasing always made more sense for businesses. I prefer to keep my phones, peace of mind knowing, if I lose something that somehow did not make it to the backups, I can just turn on my old phone and find it.

This is crazy, this is just PCP finance… for a phone!

Are there any “gotchas” of leasing vs owning the device? Do your rights to the data change? Does your responsibility to maintain the fit and function of the device change? How does lease vs buy benefit the consumer?

If I were good at financial math (which I'm not), I would calculate that against a regular loan. E.g., how high would the interest be, if you were to keep the device.

It feels like there’s a psychological component here for you to feel obliged to upgrade at the end of the 2 or 3 year term. Who wants to pay $1k for a 3 year old MacBook? Trading in/up will feel natural. It does feel less and less like you own the hardware though.

> 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

A lot of people aren’t going to have that $433 at the end of the lease to purchase the device outright, and so will have to roll it into another 2-year monthly payment, and another one after that.

So the goal of the program is the same as every other similar one - they want to turn a one-time device purchase into a perpetual monthly revenue stream, while keeping ownership of the asset at the end.

Aside from the financial analysis, there is also the fact that this strategy from Apple will prevent customer churn to alternative phones.

They still have a 12mo lease term if you want to upgrade yearly.

I also wonder whether this leasing thing is also a covert way to get people to be subject to more tracking. If you own a device you have a legal right to do anything to it you want, including jailbreak it or install your own OS that executes things differently. If you lease it you don't necessarily have that right since you are only leasing the rights to use it, not modify it.

That, and, its kind of nice to have $8k extra on hand if you need it.

> I had a friend who bought a new Mac every year, selling his old Mac.

I considered that at one point, and it would have made sense based on prices alone, but it didn't work at all once I factored in having to pay sales tax on a brand-new Mac each year, and the cut eBay takes on a sale, and the fact that the eBay buyer also has to pay sales tax.

If I lived in a state with no sales tax, and could rely on selling locally with Facebook Marketplace or something, then I'd totally do it just for the infinite warranty coverage alone!

Still bugs me that states charge sales tax even on used items. It just seems wrong.

I don't see the point for consumers. Perhaps a minority will buy a new model every year but many people keep their devices for years to come.

Companies that require frequent hardware refreshes would benefit from this, though Apple already had has programs for those.

> 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 feel like some people are ignoring the fact that "financially challenged people" have always been paying monthly payments for their phones via their carrier's lease programs, which are very popular and have been a thing since the first iPhone.

People need phones, this is a good program.

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

This but unironically

I have come to the realisation that it just makes more sense to buy repairable / upgradeable electronics / computers and cars, used. You save a lot of money that way, and the second-sales market has also become more organised so you don't really waste time too in the process.

The most dystopian thing about this timeline is how completely normalised corporate propaganda is.

> While our customers have loved the iPhone Upgrade Program, we’re always looking for ways to give them more flexibility, better value, and a more seamless experience.

If I were malicious dictator for life, there would be a special section in my gulags for the people who write copy that entails telling customers it's raining while pissing on them.

For that matter, why would you pay $1200 for a phone?

its interest free

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.

Was it replaced though? I still see the option to finance at 0% on https://www.apple.com/shop/buy-iphone/iphone-17-pro.

> People happily lease $80,000 vehicles for exactly these reasons.

Well, kinda. Various vehicles have fleet-only trim levels that are the cheapest models available. The reasons that you'd lease a $80k Ford F-150 Raptor are somewhat different than the reasons that you'd lease a $39k F-150 XL.

No there’s a big gap, but it is meant for people who want a guaranteed amount without going through the trouble of selling it privately.

> Pay $32/mo (so $770 total) to use an iPhone for two years and then give it back to Apple.

At the end of your device lease term, you have an option to buy out your leased device. With the buy out cost being equal to the device sticker price minus the amount you had already paid on your lease.

This seems pretty fair to me tbh.

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...

> 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.

First-party MSRP at that. What's a few % free loan discount in comparison to almost any other retail pricing out there that is periodically 10-15% off.

Yeah everyone's naysaying this but it seems like a no brainer?

There's no interest, no fees. The total lease price (if you buy out at the end) is the same as the retail price. There's no downside to it at all.

If you are someone who upgrades annually, you're now paying ~$599 split over 12 payments vs. ~$1199 up front and either trading in or trying to sell your last gen privately. It works out to about even on a trade-in->upgrade every year cycle, only you don't have to fork over the $600 up front.

The Apple Upgrade lease model isn't even a replacement as you have to wait 24 months before upgrading.

The entire point of the iPhone Upgrade Program was to make it painless to swap to the newest iPhone every year. Without that, there's no value proposition.

I don't know about you, but I like to own things that appreciate. Why would I care about leasing something that just loses value as time passes? This is not a bad way to get your phone, IMO.

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.

Do family plans require them to be postpaid?

Is that terrible though? You're saving $1000 on a 2/3 year cadence. I'm not a fan of the one size must fit all mentality, and that the one size is the conception that we must all run every piece of he into the ground before replacing it.

eBay takes a 13%+ cut, then there's shipping, so you're looking at $300 after cost of business. If you're selling a lot, sure, capture that $100 difference. If you're selling one and dealing with buyers, you'll spend at least one hour taking pictures, writing the ad copy, doing client management, going out to ship + gas to get to the post office, risk of buyer return/fraud. Say you're worth $50/hour and you're being very efficient and do all that in one hour, you may end up with a net economic gain of $40-50 after all that. Is it worth it?

It's a little unclear; they make you select a carrier, but buried in the fine print is:

"For iPhone only: In order to lease an iPhone, you must select an eligible carrier (but you cannot use a prepaid carrier plan). A leased iPhone is always unlocked, so you can switch carriers at any time, subject to your carrier’s terms."

So it... is unlocked? I am also on US Mobile and don't want to leave it

This is exactly what’s going on here.

You literally don’t own the hardware, it’s a lease.

That said, you can purchase with financing with an Apple Card, or with numerous other financing options like carrier financing. However, leasing allows the purchase prices of phones to continue climbing while still presenting a palatable monthly payment.

I think what’s going to happen with this is a lot of people will be lured in with low payments and then be surprised with the ending “keep your phone” payment, where it will feel like it makes more sense to just get the new phone and continue the same payments.

Paying a $400 payment on a 2 year iPhone will look insane as that’s the depreciated value of a 2 year old phone.

> This is truly the most dystopian timeline.

Why? Leasing has always been an option that some people and businesses prefer, depending on the circumstances. It’s commonly done with cars. In business situations leasing can be very common because it works well with your cash flow and doesn’t require taking more debt on your books.

You can buy out the item at the end of the lease term. Some people like this optionality because they get to defer the purchase decision into the future and benefit from any new information, like whether or not a new iPhone is worth upgrading to or how the battery is holding up.

That I could see, I guess the question comes down to how often to people upgrade. That comes down to discipline.

Is a 3 year upgrade cycle for a MacBook Pro unreasonable? Would you get a lower spec machine since you were not trying to maximize the life of the machine? I know I always tend to overspec my machine to keep it for as long as possible.

My M3 MBP with 36GB of ram (looks like it was about 2500 3 years ago) would get me $945 in trade in credit. May be able to get more on eBay but I can't argue with just doing trade in is easier. A bit less than I would "save" by just upgrading at the end of the lease and this already is not the base model so the number does shift.

Especially when I look at the payment options right now I could finance that MBP about $250 on my Apple Card for 12 months no interest, or $57.99 for 36 months. and then I get a new one.

Would probably depend on what it is I was doing with the machine, am I doing tasks that would actually benefit from better and better machines like video editing and similar tasks or am I just using my computer fairly basic in a way that even an M1 machine still handles just fine.

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.

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.

The new Apple Upgrade is also 0%, but has lower monthly payments and a balloon payment at the end, like a typical lease. It's not just cost / 24mo.

Amen

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.

So essentially 2 years worth of payments, with a reasonable monthly payment, will not be enough to buy an apple device.

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.

Additionally, the loan program was administered by Citizens Bank, not Apple.

Haha!

>they want to turn a one-time device purchase into a perpetual monthly revenue stream,

Precisely what they should have done for service revenue instead of milking App Store for the past 10 years. They should also have bundled Apple Care as part of it.

It would also allow them to hike up their price for iPhone. For example I wouldn't be surprised if the upcoming iPhone Fold and next year's iPhone 20 / XX start at $1499 to $1999.

My question is how will this roll out world wide, is this going to be like Apple Credit Card, Apple Cash and other things that is US only? Who is actually paying for the interest free loan. Somewhere along the line someone has got to give.

This is all good direction that is happening in the past 12 months, MacBook Neo, Apple Upgrade. Hopefully they will also fix the software part. macOS doesn't need annual upgrade. Perhaps neither do iOS. And the last thing would be about the App Store. But I guess that will take a lot longer.

> So the goal of the program is the same as every other similar one - they want to turn a one-time device purchase into a perpetual monthly revenue stream, while keeping ownership of the asset at the end.

Yep, which reduces the need to make new devices notably better than old ones, since you'll always have a steady stream of customers coming off their leases.

> A lot of people aren’t going to have that $433 at the end of the lease to purchase the device outright

If someone can’t plan ahead 2 years for a $433 expense, they definitely should not have a top of the line iPhone. When my income was low I had an iPhone SE that cost $329.

Except in this case, you can still choose to own it at the end of the lease. The total lease price (if you buy it at the end) is the exact same as the retail price, there's no interest and no extra fees.

> 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.”

Will they ever come out with a new mini? If they don’t, is it possible to buy a new 13 mini anymore? Or just replace the battery?

Note that they already do this if you buy a mac on an Apple Card, and they even go so far as to link your AppleID that you may have had for decades. I bought a new mac last year and signed up for the 0% Apple Card financing and if I'd have known about this little bit of leverage they use, I would have created a brand new AppleID to partition it off.

It's "just" a restructuring; the previous setup was a really bizarre financial product where Citizens Bank gave you a 24-month 0% personal loan to buy an iPhone, but Apple would also buy your phone and loan out and sell you a new one every 12 months.

Now it's just a normal lease product with a 0% money factor through Klarna, that also works across Apple.

What this does is gives Apple more "price flexibility" (aka, they can raise prices more easily, which was probably a lot of the driver for this), but also gives consumers more buying power flexibility since it's a simple product that works across the board rather than a bizarre iPhone specific optimized financial instrument.

More tricks to hide rising prices across the board.

Looks like a recession indicator to me.

legit could be your last phone ever, why upgrade?

> A lot of people aren’t going to have that $433 at the end of the lease to purchase the device outright

I think you're looking at this too much from the perspective of someone who wants to own the phone, not as someone who wants to consider a lease.

Leases are not a new invention. A lot of people, including very financially savvy and well off people, choose to lease rather than buy depending on the circumstances.

It preserves optionality. If you get to the end of the lease period and there’s a new iPhone you want or the battery isn’t holding up, you can choose not to buy it. You don’t have to deal with selling it or trading in.

If someone doesn’t have $400 to buy out the residual then I doubt they would have had the cash to pay for the whole thing up front. I don’t understand what your argument is.

> So the goal of the program is the same as every other similar one - they want to turn a one-time device purchase into a perpetual monthly revenue stream, while keeping ownership of the asset at the end.

It’s an option. They’re not turning anything into anything. Anyone who wants to buy the device can buy it. You now also have the option to lease it for 12 or 24 months and then after that you can still buy it if you want. Or you can not buy it.

It’s options. You don’t have to use it.

Someone who won't have that $433 has no business even thinking about a 1200$ phone in the first place

Isn't the 0% APR financing essentially just a sales expense? Even if people generally don't immediately roll into another 2-year agreement, the main reason zero-interest financing works for the sellers is simply that it makes it easier for people to spend money on expensive high-margin stuff.

Multi-year zero-interest loans are also commonplace in high-price, high-margin specialty retail: think La-Z-Boy, Sleep Number, home improvement, hot tubs, home gym equipment, etc.

its not that they wont have $433, it is that people will be unwilling to shell out $433 for two year old device, if they have an option to renew it for a shiny new model and roll forward into another BNPL loan

There's no need to settle for a measly $10GB plan for that kind of money. Mine costs $32.50 and includes unlimited data (actually not deprioritized, too) and 50GB of hotspot.

If you really can settle for 10GB though, you could do it for even less.

I can see how some people feel like the phone financing is something they need if they have cash flow problems and trouble accessing credit, but boy do those postpaid carriers make you pay for it, both in the payments themselves, AND in the plan itself costing more than twice as much what I pay even if you've finished paying off your phone payments.

Where can you consistently get 10-15% off apple products?

When you return the device, it needs to be in mint condition. You now have a credit obligation with Klarna, whereas on the pervious system, there was also 0% financing but it was bundled AppleCare+.

I don't think anyone will ever excercise the buyout option since the phone will never be worth more than the buyout price. And like you're saying, this program does not make sense unless you are upgrading every single year.

I mean in any case, every option looks defensible once you've accepted the premise that you need a new phone every 12 months. Any minute differences in costs are just rounding errors. Like I really don't think someone upgrading every year is going to have a significantly different retirement income because they saved $1200 every year by not buying the iphone outright. It's really just a convenience thing, not a financial decision.

It doesn't get "rolled in," since you don't have to transfer any liability to the next lease.

that doesnt happen lol

Given how rapidly iPhones depreciate, being able to just give it back after 2 years is pretty reasonable. My 16 Pro Max is worth maybe $500 on the resale market.

They won't throw it into the shredder. They'll capture the residual by wholesaling it second-hand, same as with trade-in's.

> while keeping ownership of the asset at the end.

But they're not actually interest in owning 2 year old phones though right?

They're just interest in you / 2ndary market not owning any?

Yeah, especially considering most people already do this in some fashion but through their carriers (at least in the US) w/ carrier financing + those extra $10/month "upgrade anytime" programs and they end up paying more than what leasing from Apple will work out to.

Especially if you're someone who upgrades every year. 12 month option on a 17PM works out to ~$599 for the year vs. $1199 each year. $599 is roughly what you'd pay for each years new model assuming you trade in your previous gen each time, so at worst it's even with what an annual upgrader was paying already, at best you might make out a little better (assuming you are just doing trade-ins and not private sale).

There's no interest or fees, and you get to buy it out at the end if you want to own it, and the lease price is the same as the retail price, I see no downside.

Historically, owning them meant when one person upgrades, other family members could get their old ones. I use my old iPhone as a dev phone for iOS coding. I can also just enjoy having a working device that I'm not still paying for once it's paid off.

The iUP was better about giving the choice to just buy it out at the end. This one is more rigid:

>Terminating your Apple Upgrade Lease: Closing your lease and returning your device terminates your lease. You may incur substantial fees if you terminate your lease before the end of your initial lease term. You may have the option to upgrade to a new device by entering into a new lease agreement and returning your prior device. If you upgrade, your new monthly payments may be greater than your prior monthly payments. If you do not upgrade, terminate your lease, or purchase your device by the end of the initial lease term, the lease will convert to a month-to-month lease for up to six months. Your monthly payments may increase during the month-to-month periods. If you take no action at the end of your extension period, you will be charged the purchase fee under your lease. You will not own your device at the end of your lease, unless you pay the purchase fee. Insurance is not included in your lease, and you may incur damage fees if the device is lost, stolen, or not returned in the condition required by the lease.

Partnering with Klarna explains it quite a bit. They make money on penalties. This new plan has all sorts of sticks it will beat you with if you stray off the path, so it's perfect for them.

Or, they can still pay the $400 and try to resell it for higher. And then buy a cheaper Android when they finally realise being in debt for making a fashion statement is stupid.

You're saving $1000 if you were normally throwing away your 2/3 year old phone instead of selling it to someone else.

the other problem is if it’s stolen or damaged.

they literally say you will pay large fees in those cases. it’s basically self insuring.

It should be noted that with Visible+ after the $29/mo promotional rate ends in 12 months and it goes to the regular $35/mo you could switch to the annual plan. That's $375/year, equivalent to $31.25/mo if we ignore the time value of money.

Another thing to note about Visible+ is that if you have an Apple Watch with cellular and want to use that with your plan there is absolutely no reason to consider Visible+.

Watch support can be added for $10/mo but that brings the total to the same as their highest level plan, Visible+ Pro, which includes watch support. That plan is $45/mo $450/year ($37.50/mo) and promotional discounts run out.

As far as I was able to tell, Visible+ Pro is the best or very close to the best deal for people who want Apple Watch support in the US and only want one line. You can get lower prices per line on postpaid plans with multiple lines but if you will only have one the postpaid plans are ridiculous (even before you add in watch support).

Whenever I sell used good, I use ebay to set the price, but I sell locally, so there's no shipping/fees involved.

Local prices around me always seem weirdly high - I sort ebay by cheapest price+shipping, match that, and that usually puts me cheaper than 90% of local listings and gets me plenty of interest.

TBH I'm not clear on why anybody outside of rural areas is selling on ebay for non-niche things.

Metro By T-Mobile works well, if you navigate through the website to find the $25/month ($30 without autopay or for the first month) postpaid unlimited plan. It is a T-Moblie MVNO.

It is hard to get eSIM to work, but they have good customer service (but you need accses to a phone to call them, so you should try something like textnow or Google Voice) which helped my friend set it up.

It is not a intruductory offers, AFIK.

>Paying a $400 payment on a 2 year iPhone will look insane as that’s the depreciated value of a 2 year old phone.

Check ebay. That's around the price of a pro series iPhone 2 years old.

The 0% financing fine print is as follows:

> Financing available to qualified customers, subject to credit approval and credit limit, and requires you to select Citizens One Apple iPhone Payments or Apple Card Monthly Installments (ACMI) as your payment type at checkout at Apple. In order to buy an iPhone with ACMI, you must select one of the following carriers (but you cannot use a prepaid carrier plan): AT&T, T-Mobile, or Verizon. An iPhone purchased with ACMI is always unlocked, so you can switch carriers at any time, subject to your carrier’s terms.

> 4 lines on Unlimited Plus for $31/line.

Important: Does this include taxes and the many "regulatory offset fees" or whatever they call them? My numbers do include everything.

Looks like that plan[1] offers 30GB of mobile hotspot. I get 50GB.

The Unlimited Plus throttles video by default to either 480p, unless you're in a UWB (mmWave?) tower you get 720p. You can get "up to 720p" even on "plain" 5G by adjusting a setting though. My plan does the same default as well, but when I adjust a setting, I get unthrottled video.

You get 50% off a data plan for a watch, which looks like is a $10 plan? So $5 add-on for a watch. My plan includes a watch for free.

It doesn't look like you get international roaming with Unlimited Plus. I get 20GB of roaming in 125 countries in my plan. I've used it, it works great.

And to get the rate you're talking about, you have to buy 4 lines. No problem for you, but it's notable that singletons pay $80 (with autopay) for that plan. Mine is $32.50 since I pay annually (actually it was less because I paid during a sale, but I don't want to make claims that aren't easily available anytime). I don't have to ever call and threaten them to stay at $32.50 because that's the full price.

Anyway, that's US Mobile as you may have guessed - and that's their best, Unlimited Premium plan.

Oh, I also pay an extra $10 a month to add a second eSim on a different network, a feature they offer. It uses your same allowances (for me, hotspot is the only thing that's metered anyway) but means that I can hop between AT&T and Verizon towers at will. You can also just port your main line to a different network at any time, if you just decide that you want to. They support all three US networks.

[1] https://www.verizon.com/support/unlimited-plus-faqs/

My internet provider (Spectrum) is a Verizon MVNO and is cheaper than that. I’ve got two lines and a watch add on for $70/mo, and I don’t even have their internet service anymore because I switched to a better fiber to the door provider.

I check with people that come around or in random stores if they can beat it, alas they cannot.

Switching to grapheneOS

New ones don’t seem to be available any more, you probably need to go refurbished. Last year some third-party sellers still had new units available. Replacing the battery is always an option.

It doesn’t look like Apple will be going back to something smaller than the 17e. Unless you count the upcoming foldable, which while shorter than the mini, however is also wider, thicker and heavier.

perhaps even a... great depression indicator? (ref: wvfrm ep. 364)

> Perhaps a minority will buy a new model every year

It’s not just a 1 year program.

The comment you replied to had numbers for the 4 year option.

If everyone was as rational as you, Americans wouldn't be living in debt that most cannot afford. Most Indians have a healthy fear of debt, and that is why the iPhone doesn't have a larger share of the mobile phone market here as it really is unaffordable to most Indians (as it is for many in America). Americans however have accepted debt as a normal part of their lifestyle. When a rich man says poor people shouldn't be ordering food through Door Dash, it sounds very cynical but there is a basis of truth in it that some poor people really do not know how to manage their finances.

Citizens was the worst part of the prior program

> Still bugs me that states charge sales tax even on used items. It just seems wrong.

Yes VAT is a better system.

What do they do to your Mac if you don't make payments?

Makes sense, thanks!

> I don't see the point for consumers.

Isn't it this:

>> His calculation was that it was about the same price as keeping one Mac and upgrading every 5 years.

This is unchanged from the upgrade program terms before. The phone is unlocked, but when you take delivery of the phone you have to activate it on a Big 3 carrier's postpaid plan.

Visible has a family/friends plan - called "Inner Circle" - that comes with a $5/month discount on the Visible+ or Pro plans, and allows one account to pay for all the others.

The fact that we need to use the financing models of cars for basic consumer electronics is the dystopian part.

> Is a 3 year upgrade cycle for a MacBook Pro unreasonable?

For a personal machine? Yes that’s something I see as unreasonable, MacBook Pros have a very long lifespan. M1 laptop are still pretty awesome machines. For a business an upgrade every 3 years could make sense

They have 12 month options for the Apple Upgrade program. I just checked how much it would cost to get an iPhone 17 PM + AppleCare+ with theft protection like I currently get from the IUP and it's $3 more a month.

The issue is deeper than than. Even if you buy, not lease, the iPhone, you don't control the software. Apple is still the effective owner, and tells you what you can and can't run on your own device. Worse, Apple is able to remotely inject user-hostile programs, such as the planned CSAM scanner that was planned but ultimately abandoned[0].

[0] https://9to5mac.com/2023/09/01/csam-scanning-flaw/

Wait, do people actually upgrade yearly? I always thought it was hyperbolic

That’s evil.

So if the target demographic, the person that does not have money to buy an iPhone outright, is mugged, they need to essentially buy the iPhone outright or they start racking up interest and fees.

(I don’t care if they say the target demographic is “people who upgrade every 2 years” instead. If that were really the case, you don’t need financing, just a buy-back program)

Well there’s a reason Americans have $1.25 trillion in credit card debt.

I wish we got some shrinkflation and they brought back the iPhone mini.

apple upgrade forced obsolescence maybe?

Have you met…America?

> roll forward into another BNPL loan

It is not rolled forward. If they don't want to pay the $433, then they don't. They return the device and the new device's lease doesn't include that $433.

It's not like a used car loan that some people have that keeps growing with each transaction (and at insane interest rates).

People are keeping their phones for longer and longer. This makes it as attractive as possible to pay for a new phone at a more frequent rate.

The bet here is that Apple would much rather you spend ~$35/month perpetually than $1200 every 4 years.

This is a 'good deal' if you're already someone who upgrades their phone frequently, but I would imagine this would end up getting a whole bunch of people to pay more money in the long run to Apple.

They also charge heavy interest and fees to people who miss payments, but in this case that will be captured by Klarna.

They already do shred as many as they can (as my link documented) because used iPhones merely existing compete with Apple's offerings.

Think of it from Apple's perspective: You sell a phone for $1,100 and get a 37%[1] margin on it, so that's a $407 profit margin, and a $693 cost to make it.

That phone gets Apple $768 in lease payments according to their site.

Then they take the phone back from the user at 2 years old. EBay shows 2-year-old iPhone 15 Pros going for about $400 so let's assume the wholesale prices is $300.

So Apple has the old phone and can sell it for $300 pure profit before tax or $237 after 21% federal tax, but they know that its existence will displace a new iPhone sale somewhere. Or they can declare it as "too damaged to resell" and shred it, probably take a tax deduction (for the official residual of $332? I'm not sure) for that loss, offsetting $70 of taxes elsewhere, and (very very important point here) because they know they'll sell one incremental new phone, they can expect to have an additional $1100 of topline revenue to show, and another $407 gross profit that they get to book.

Sell it: $237 - $70 opportunity cost of tax deduction they don't get = +$167 to gross profit, Shred it: +$1100 topline, +$407 in gross profit, +$70 in EBITDA.

I'm not a real accountant so I'm sure a few of these figures are off, but I think my main point is valid: Since Apple's main motivation is to increase their stock price, they may benefit more from shrinking the aftermarket than they would from harvesting the value of the old iPhone.

This logic does depend on an additional working semi-late-model iPhone finding its way into the hand of a person, or there being a chain of people, at the end of which having someone who won't buy a brand new iPhone this year, but I think it's hard to argue it doesn't.

[1] https://axis-intelligence.com/apple-statistics/

[2] https://www.apple.com/shop/buy-iphone/iphone-17-pro?purchase...

I checked the price for a used iPhone 15 pro (ie. 2 year old iPhone) on ebay and it's around $400-$500. Therefore the implied depreciation of the lease is pretty fair, unlike the lowball offers you typically get for trading in a phone.

Why on earth are we leasing phones now???

> If someone doesn’t have $400 to buy out the residual then I doubt they would have had the cash to pay for the whole thing up front.

That’s the entire point. They would have bought a cheaper phone, or held on to their old one, but are now paying perpetual monthly payments.

There’s a reason car dealerships never ask “how much can you afford”, but “how much do you want to pay every month”.

There’s a reason Klarna is running the program for them.

you overestimate the financial health of most Americans.

most people live on credit cards as bridge finance between paychecks. when I mean most people - I mean 50% of the population.

wait till you see what people do with car payments

Ah, cool, looks like they added that about a year ago. I hadn't looked at Visible recently. But Inner Circle just brings Visible+ down to the same price I'm already paying Verizon ($30/mo/line) since it doesn't stack with other promos and doesn't combine with an annual plan. And I'd still have to setup four separate accounts, I could just pay them all in one place.

Still, thanks for pointing it out.

"need" is doing a lot of work for a luxury product

You don’t need to do it. It’s an option.

Also calling the latest iPhone “basic consumer electronics” is out of touch. The budget options are older generation iPhones or other phones, not one of the most expensive brands on the market.

I have an M1 Pro with 32GB of RAM and am hoping to make it through the rampocalypse. This may be my longest upgrade cycle, but fortunately the machine is fast enough for most things including LLMs.

I still use a 16GB MacBook Air for all my development and simulation work (4P+4E+8GPU cores). Even wrote my own Metal gpu code to offload part of the simulation workflow. Modded the MacBook Air with thermal pads and a homemade cooling pad made from cardboard and a usb fan to limit throttling. I’ve run simulations for over 24 hours and kept temps below 90C successfully. A newer Mac mini would be better, but those are so expensive now.

So, the phones arrived locked? You can't use them with any carrier you want?

You already do it for music and TV shows. That's not cheap either.

A refurbished iPhone 15 Pro is selling for $929 on their website right now. Trade in price for that exact model is $410. So yes they are very interested in that old phone.

I stand corrected! This doesn't look too bad then.

Then I guess we’ve been in the dystopia for almost a century now. When I was a kid in the 70s and 80s we leased our TV and VCR. It was hugely common in the UK, the company was on many high streets and literally called Radio Rentals, founded 1930: https://en.wikipedia.org/wiki/Radio_Rentals

> Radio Rentals was the largest television rental group in the UK and claimed that at its peak it had more than two million customers, more than 500 shops, 3,600 technicians, 2,700 skilled installers and a large ancillary staff. It had sales and service locations across the UK; the Radio Rentals logo being a common sight on many High Streets.

You can still just buy it. This is another payment option.

I mean we are talking about the "Pro" machine. I think there is likely an argument to be made that if you are not doing a task that would genuinely improve with more powerful hardware do you actually need the Pro machine and you could instead go with a MacBook Air that you keep for far longer since your doing basic tasks. I do think there is still some ideas of the pro vs the Air that we are still stuck with from the Intel days.

Is that threshold for using a Pro machine 3 years, I don't know probably not for most people. My M3 Pro from almost 3 years ago is still running beautifully. I could make the argument that more power would benefit what I do with this machine without a doubt, is it worth the upgrade? I don't know, but I would be lying if I have not been thinking about it.

But I also think about the mentality I had when I bought this machine, and the mentality I had when I was looking at possible upgrades just a few weeks ago. Possibly paying more to overspec the machine compared to my current use case assuming that I want to continue to use it in 3 to 4 years.

I don't know if that calculation is necessary as cut as dry.

All of that is true, but has nothing to do with the new payment plan apple just released.

This is the same as when you get a phone through a mobile carrier. T-Mobile doesn't care that I got mugged, they want their money.

Fairly certain there is no forgiveness with lease terms. Also, Im surprised that Apple Care is not a requirement, but it seem more like a decision to put the risk on the lender rather than Apple in the case of loss. I would expect a majority of people to buy the apple care for a few dollars more per month.

People must really like the dopamine rush of feeling outraged.

Giving people the option to not buy insurance is not evil. It's just a seller giving a buyer options at different price points.

I'm a little confused on why anyone would pay this much for a phone. (Although if you consider it conspicuous consumption that happens to work as a phone, I can believe that.)

Now let's count their mortgage debt.

I do for my iPhone yes. It's definitely overkill and certainly not recommended for 99% of people.

> Why on earth are we leasing phones now???

Same reason some people lease cars:

* want the New Thing regularly

* are happier with OpEx than CapEx (can be handy for business/accounting reasons)

Around 20% apparently do: https://c9ac71a8282e1fecd95e-f07dbcddcacf0d4c572ea7178ee6902...

From: https://www.sellcell.com/blog/how-often-do-people-upgrade-th...

I just bought a 1 year old iPhone 16 on Facebook marketplace for $400. You can find pretty good prices if you don't need the latest device.

[delayed]

money number must go up?

Yes please. I can't really believe it but I'm researching android phones because I will not upgrade to something larger than my 3rd gen iPhone SE.

FWIW Apple has had some of the best device support lifetimes of any smartphone. Google started guaranteeing their 7 years of updates sometime around the Pixel 6 or so I want to say.

This is all a relative scale though. But if we're looking at smartphones specifically, I'd argue Apple has been the least force obsolescence of anyone. I wouldn't be surprised if there are some smaller manufacturer niche cases that surpass it.

It's not common (I think average upgrade cycle on iPhone is a little more than 3 1/2 years now, and getting longer every cycle) but it's not unheard of. The iPhone hold value well enough that you can often trade it in at something like a $200 discount and just get the new one.

Considering the cost of a battery replacement, it's not the worst value proposition in the world.

if you are willing to run an old OS (and the OS's are getting worse too) then I think you should be OK

You know those financially irresponsible people don’t need this program, right? They would have used a credit card to buy it with much worse terms

You seem tilted at Apple for offering a financing option, but your real gripe is apparently with some people who have poor financial decision making skills. Those people could (and probably would) do a lot worse with traditional options like a credit card.

Can we at least compare apples to apples (hah) and look at the actual terms of the program here? Honestly they're not bad, and I say that as someone who leans toward purchasing outright.

Well, lets do math:

- from this thread: 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

If you upgrade your phone every 1-2 years then what you pay for the phone is something like "full cost - optimistic trade-in value". I see no reason not to do if you know you going to upgrade.

>when I mean most people - I mean 50% of the population.

That's not really applicable because:

1. the study is for an "unexpected" expense. This you can see from 2 years away

2. The wording in the study was something along the lines of "would have to dip into savings", not that they literally don't have any money for it. The fed's survey of consumer finances shows the median household has between 7-13k (depending whether you're counting median income or median wealth) in their checking accounts

https://www.federalreserve.gov/econres/scf/dataviz/scf/chart...

The median US household has a net worth of $200,000. Even a 50th percentile US household is very wealthy by global standards.

Credit card statistics are heavily manipulated because it's easy to make them sound terrible. I don't know which factoid specifically you're referring to, but the studies about "X percent of Americans couldn't handle an emergency expense without putting it on a credit card" often use tricks like including anyone who would pay by credit card if they could. I remember reading some of these studies and realizing that I would have been included in the statistic because I prefer to use a credit card where I can, even though I pay it off before interest accrues.

That’s tame when people are leasing literal meals with klarna

Selling my car that I fully owned in favor of a nice bicycle and an e-scooter was one of my best financial decisions in the last few years.

I don't have to deal with insurance, parking (if parking is free by you, it shouldn't be), maintenance (I work on them myself, I just pay for cheap parts), and fuel is effectively free. That's all on top of the car payment for people who haven't paid off their car.

We still have this in the US, it’s called Rent-A-Center and it’s a way to extract extra money from poor people for luxuries they can’t afford.

> do you actually need the Pro machine and you could instead go with a MacBook Air that you keep for far longer since your doing basic tasks

This is probably the case for a lot of people, but Apple is smart with their lineup and there are several what I'd call "not pro" features that are gated by the MBP (and iPad pro) which is unfortunate.

Primarily, 120hz screen, SD card reader, HDMI port. None of those are really "pro" featuers, they're just basics I'd expect on any premium laptop.

That being said, 3 years is a tad on the aggressive side for an upgrade cycle for a laptop. I just upgraded my M1 last year, and this M4 Pro will easily last a year or two longer before I feel a compelling need to upgrade, outside of getting RAM constrained. Use case is photo+video production. So for me, a 5 year cycle would be about right.

But also depends on how you spec it out. If you are just buying the base model, then 3 years makes sense. If you spend extra to max it out, you'll be able to hold onto it for 6+ years.

There are phones that cost a lot less though. 50% of Americans being unable to afford iPhones doesn't mean they should just lease them. People need to stop associating so much personal sense of worth with their handheld computer.

- written on my S10

I take it you’ve never purchased an Apple refurbished product? They’re in excellent condition. They do not look like 2-year used and abused trade ins. If trade-ins are going back to the refurb inventory (which I don’t know if they do) then it’s only after extensive actual refurbishment and new parts.

They’re not putting it back into a box, listing it for sale, and pocketing the difference.

For now

I mean, it is $36 more a year but I guess that's not terrible. What will be interesting is the tax paid up front. IIRC, I paid tax on the entire device every time I renewed rather than just paying it during each month. So I always thought it wasn't the best deal because I paid tax on a device that I only ended up paying off half of before renewing and starting the process again. I could be wrong, though. I'm not the best with finances.

> You know those financially irresponsible people don’t need this program, right? They would have used a credit card to buy it with much worse terms

I thought of this also. The question is whether they will now spend even more on the phone since they won't be paying as much in interest. If so, it's savvy of Apple to suck up that difference instead of letting it go to credit card companies.

Presumably Klarna's share is lower because Apple is rumored to be able to nerf these devices if a series of payments are missed. [1]

1: https://9to5mac.com/2026/07/21/ios-27-code-suggests-apple-co...

It's not a great option. My "old" phone that I use to install junk apps (e.g. I buy some hardware that requires an app to set up) and which mostly sits in a drawer is a 2nd gen iphone SE, and it's getting to the point where I'm going to be forced to replace it, because the OS hasn't been upgraded in a while (it errors) and some apps won't install on it now.

From that lens this is a better option for the "buyer" (renter). Cause revolving credit is >10%, sometimes even more than 15%!

> They would have used a credit card to buy it with much worse terms

average credit card interest rate: 18-25% APR [0][1] average klarna effective interest rate:25-33% APR [2]

getting what are effectively individual lines of credit per-burrito or iphone is crazy work and I wouldn't recommend it most of the time. Save some money up, people!

[0] https://www.experian.com/blogs/ask-experian/research/current... [1] https://www.forbes.com/advisor/credit-cards/average-credit-c... [2] https://wealthvieu.com/debt/credit-card-debt/klarna-review/

Net worth or net income? Being 40yo with only 200k of worth between two when you’re halfway through your working life and have had 10y of appreciation of assets isn’t very much to go forward with.

Also leasing whatever Subway sells https://sezzle.com/shop/subway

Crazy you had such a pertinent message written on your S10.

The ones that are not in great condition get sent to third parties and sold for slightly less. But Apple will replace the screen or battery and sell them themselves as well. I've gotten Apple refurb products with minimal signs of wear.

They have the ability to tear the whole thing down to guts and screws. They absolutely do replace the case, glass and battery and sell as refurbished. They already do complete case swaps on their Macs.

What makes you think Apple would not accept 100% payment today if someone wants to buy the device outright?

I don't think iPhone Upgrade Program was ever the best deal to be honest. It's just convenient.

I don't understand this mindset. I get that people who are going to upgrade to the latest flagship phone every 18-24 months will probably do better with this, but realistically... those people are fucking insanely financially irresponsible (and if you can afford it - no shade, I guess, its your money - lord knows I burn lots of cash on hobby projects of my own, although I tend to buy things that are actually projects, and not just glitz...)

But there's just nothing to run on phones built in the last 5+ years that actually puts the hardware through its paces (in the phone form factor, laptops and desktops I'd be lot more forgiving on). The cameras aren't really getting better. The battery capacities seem to be mostly "the same". There's just no practical "reason" to justify the expense at this point (and I'll fully acknowledge this wasn't always the case - there was a period there in the early 2010s where phones were getting better rapidly and upgrading was a big deal).

They're basically buying an expensive piece of jewelry that they'll throw away in 24 months. Like... just buy a cheaper model and get some real jewelry. At least that could be passed down at some point instead of becoming e-waste.

averages strike again.

Median wealth in the U.S just around $100k - see Wikipedia & other databases.

how many people own houses ? & for those people that own houses - average equity in those houses is less than 45%.

ain't no factoid - but lived reality of most people. maybe on the coasts where techies and finance bros live - but the rest of america is facing a bleak financial reality.

This math is what lead me to the iUp program in the first place. It's effectively a guaranteed 50% trade-in, which came out to about $200-300 in actual money that I was theoretically sacrificing in exchange for not having to worry about the cosmetic condition of the phone or weirdos on ebay.

And it came with AppleCare+ with Theft and Loss. I stopped using a case. I lived free.

Not sure what you are trying to argue.

Should people be more financially responsible? Yes

Are they today? No

In a rational world payday loans, predatory auto loans, BNPL, perpetually rolling credit card debt etc would not need to exist. Yet these sectors are rapidly growing and companies in it are thriving.

It's still obviously making them money. How much, who's to say, likely highly variable depending on the condition of the phone. But if it didn't make them money they wouldn't do it, they're not a charity.

I'd imagine even a phone they can't fix to sell still has some value, even as scrap to them especially as the costs of every damn material that goes into any electronic device continue to soar.

And that all being said: two things can be simultaneously true at once. Leasing is a perfectly valid form of... well you can't really say ownership, acquiring goods I guess? And it also does mean Apple can now turn what may have been one-shot purchases into people who are just fine paying a monthly payment ad infinitum. And that, in turn, opens the door for keeping people on a perpetual new-phone treadmill of monthly payments that involve them never actually owning anything.

You can very easily tie this into the Samuel Vimes Boots Theory of Economics:

The reason that the rich were so rich, Vimes reasoned, was because they managed to spend less money.

Take boots, for example. He earned thirty-eight dollars a month plus allowances. A really good pair of leather boots cost fifty dollars. But an affordable pair of boots, which were sort of OK for a season or two and then leaked like hell when the cardboard gave out, cost about ten dollars. Those were the kind of boots Vimes always bought, and wore until the soles were so thin that he could tell where he was in Ankh-Morpork on a foggy night by the feel of the cobbles.

But the thing was that good boots lasted for years and years. A man who could afford fifty dollars had a pair of boots that’d still be keeping his feet dry in ten years’ time, while the poor man who could only afford cheap boots would have spent a hundred dollars on boots in the same time and would still have wet feet.

> average klarna effective interest rate:25-33% APR [2]

> getting what are effectively individual lines of credit per-burrito or iphone is crazy work and I wouldn't recommend it most of the time.

I think this whole sub-thread has gone off track from people who aren't reading the actual terms of the Apple deal.

Nobody's talking about getting a 33% Klarna loan for an iPhone or burrito. You included 2 statistics and 3 citations that have nothing to do with the program we're talking about.

We're trying to talk about the Apple program in the link, not some other financial services complaints that people have about other things.

it's a 0% loan with a buyout at the end for 2 years though. not 33% APR.

I’ll never stop using a case. Too clumsy, too careless. 2-3 days without my phone would be manageable but why?

>Not sure what you are trying to argue.

I'm saying the specific claim of "most people live on credit cards as bridge finance between paychecks. when I mean most people - I mean 50% of the population" is false.

> averages strike again.

My comment said "median" explicitly

The number was for household wealth. I think you're looking at individual wealth, which would naturally be lower because it's spread across more people.

Source: https://www.federalreserve.gov/econres/scf/dataviz/scf/table...

The average (mean) is closer to $1 million per family, but that's not a useful number.

The internals in that phone are probably worth more today used than brand new 2 years ago.

actually per UBS [0]: Median Wealth in the US is $68K. Almost neck in neck with median income.

[0]: https://www.ubs.com/global/en/media/display-page-ndp/en-2026...

> It's still obviously making them money.

They’re obviously making money on the whole purchase and program because they’re a business, not a charity.

The assumption that they’re making significantly more money on this than direct sales may or may not hold. It could be that they’re targeting a similar level of end-to-end profit as direct sales but using this to expand their market by providing more purchasing options.

Some people get angry at the prospect of a company making money, but they’re not charities. Everyone should do the math and decide which purchase options work for them. What works for you may not be appropriate to force on to the rest of the population.

So how much annually do you spend on your hobbies, anyways, if you're going to declare getting a new phone every two years "fucking insanely financially irresponsible" :p Glass houses and all that, right?

Since the days of Samuel Vimes, durable goods have undergone spectacular deflation and health care, housing, and education have undergone spectacular inflation.

One month of median US rent buys three 55" TVs.

The math has changed.

For me, the primary value of my phone is the camera, and the telephoto on the iPhone Pro Max models has gotten significantly better in the 2.5 years since mine was released.

Were it not for the camera, I could have stopped upgrading 10 years ago.

My point is, not everyone values the same things you do. The new Siri AI only runs on 15 Pro and higher, I think. New features do arrive in newer phones.

Durable goods also seem much less durable. I go through way more fridges, dishwashers, etc then previously.

iPhone 17 Pro is binoculars and also eliminated 16 Pro battery anxiety.

Value in being part of the discussion for a whole year every year too. You realllly have to care about stuff like these factors though (or hate investing your money or have too much).