| ▲ | nerdjon 3 hours ago |
| The math for the new program is kinda perplexing, my guess is that they are hoping that most people just will send in the device and upgrade. If I am reading the FAQ here properly: https://www.apple.com/shop/apple-upgrade. > If you decide to buy the device, the purchase option fee is the list price minus any lease payments you’ve made minus any remaining discounts or trade-in credit. (excluding tax and any damage fees). Lets look at a couple examples: 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 The cheapest 16" MBP would be 2,999 to buy (3186.44 with tax) or $57.99 for 36 months (or 80.99 for 24 months). 2087.64 or 1943.76. So around ~1k to buy it at the end. It looks like you can keep making payments for 6 months to lower the buyout price a little bit. So worst case scenario this is a 3 and a half year interest free loan with a higher payment at the end. Seems not terrible? As long as you treat it as a loan and not a lease you can end at any point it seems fine and nothing really shady about it. You still have the option to own the device for the original cost. Other than the loss of the iPhone upgrade program and the yearly upgrades, am I missing something here? I guess the biggest thing is you likely can't just pay it off and be done with it if you had the money. |
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| ▲ | paxys 2 hours ago | parent | next [-] |
| > 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. |
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| ▲ | Aurornis an hour ago | parent | next [-] | | > 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. | | |
| ▲ | paxys an hour ago | parent [-] | | > 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. | | |
| ▲ | Aurornis an hour ago | parent [-] | | 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. | | |
| ▲ | edoceo 41 minutes ago | parent [-] | | From that lens this is a better option for the "buyer" (renter). Cause revolving credit is >10%, sometimes even more than 15%! |
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| ▲ | tw600040 25 minutes ago | parent | prev | next [-] | | Someone who won't have that $433 has no business even thinking about a 1200$ phone in the first place | | |
| ▲ | dzonga 13 minutes ago | parent | next [-] | | 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. | | |
| ▲ | gruez 3 minutes ago | parent [-] | | >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... |
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| ▲ | paxys 22 minutes ago | parent | prev | next [-] | | Have you met…America? | |
| ▲ | PunchyHamster 22 minutes ago | parent | prev [-] | | wait till you see what people do with car payments |
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| ▲ | bijowo1676 an hour ago | parent | prev | next [-] | | 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 | | |
| ▲ | gruez a minute ago | parent [-] | | 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. |
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| ▲ | lesuorac an hour ago | parent | prev | next [-] | | > 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? | | |
| ▲ | paxys an hour ago | parent [-] | | 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. | | |
| ▲ | Aurornis an hour ago | parent [-] | | 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. | | |
| ▲ | fckgw 30 minutes ago | parent | next [-] | | 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. | |
| ▲ | ToucanLoucan 43 minutes ago | parent | prev [-] | | 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. | | |
| ▲ | Aurornis 30 minutes ago | parent | next [-] | | > 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. | |
| ▲ | smallmancontrov 27 minutes ago | parent | prev | next [-] | | 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. | |
| ▲ | paxys 16 minutes ago | parent | prev [-] | | The internals in that phone are probably worth more today used than brand new 2 years ago. |
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| ▲ | giancarlostoro 30 minutes ago | parent | prev | next [-] | | Let's suppose that Apple somehow doesn't release any new iPhones during this leasing window, what happens then? Does Apple ship you back a new phone that's essentially the same model? I know this is unlikely, but I am curious. The other thing to consider, that while Apple might sell you the phone for $400 or whatever, they might re-sell it as refurbished for $700. | |
| ▲ | quickthrowman an hour ago | parent | prev [-] | | > 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. | | |
| ▲ | thisislife2 38 minutes ago | parent | next [-] | | 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. | |
| ▲ | paxys 42 minutes ago | parent | prev [-] | | Well there’s a reason Americans have $1.25 trillion in credit card debt. |
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| ▲ | enahs-sf 2 hours ago | parent | prev | next [-] |
| 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. |
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| ▲ | Grombobulous an hour ago | parent | next [-] | | 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. | | |
| ▲ | gruez a few seconds ago | parent | next [-] | | >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. | |
| ▲ | thisislife2 27 minutes ago | parent | prev [-] | | 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. |
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| ▲ | nerdjon 2 hours ago | parent | prev | next [-] | | 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. | | |
| ▲ | dgellow an hour ago | parent [-] | | > 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 | | |
| ▲ | jonhohle an hour ago | parent | next [-] | | 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. | |
| ▲ | chorizo an hour ago | parent | prev | next [-] | | 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. | |
| ▲ | nerdjon 20 minutes ago | parent | prev [-] | | 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. | | |
| ▲ | thewebguyd 4 minutes ago | parent [-] | | > 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. |
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| ▲ | halJordan 2 hours ago | parent | prev | next [-] | | 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. | | |
| ▲ | SkiFire13 an hour ago | parent [-] | | You're saving $1000 if you were normally throwing away your 2/3 year old phone instead of selling it to someone else. |
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| ▲ | 2 hours ago | parent | prev [-] | | [deleted] |
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| ▲ | giancarlostoro 31 minutes ago | parent | prev | next [-] |
| > 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. |
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| ▲ | MrGilbert an hour ago | parent | prev | next [-] |
| 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. |
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| ▲ | engineer_22 23 minutes ago | parent | prev | next [-] |
| 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? |
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| ▲ | fckgw 2 hours ago | parent | prev | next [-] |
| They still have a 12mo lease term if you want to upgrade yearly. |
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| ▲ | dgellow an hour ago | parent [-] | | Wait, do people actually upgrade yearly? I always thought it was hyperbolic | | |
| ▲ | fckgw 34 minutes ago | parent [-] | | 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. |
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| ▲ | dyauspitr 41 minutes ago | parent | prev | next [-] |
| It’s a forcing function for an upgrade. You pay 75% of the cost of the device for each 2 year cycle and many people will keep doing that in perpetuity. Compared to someone that keeps their phone for 6-7 years, the leasee will pay 3x as much over that 6 year period. Apple will also get the phone back and resell the refurbished one for 50% of its original price. Apple will benefit in two ways. They will make 125% of what they used to make on every phone they sold because they can sell it twice and more people will be forced into the two year upgrade cycle (because they can’t afford the buyout at the end) increasing their overall sales numbers in general. If you’re a consumer, you should just treat this as a 24 month interest free loan and then buy the phone outright at the end of that period. If you put the outright cost of the phone into a bond (say 7.5%) during that period, you will even get 3 months payment free and only pay for 21 out of those 24 months. |
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| ▲ | an hour ago | parent | prev | next [-] |
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| ▲ | apercu an hour ago | parent | prev [-] |
| "You'll own nothing and you will love it" |
