apple is rumored to be preparing a new iphone rental program that'll be announced alongside the iphone 14 lineup this year and that's straight from mark german one of the most reliable apple analysts out there yes that means you'll be able to rent your iphone once a month directly from apple instead of buying it outright or through your cell service provider and yes unfortunately that also means that you could be paying for years and never actually pay off an iphone in full and own it yourself but here's the kicker a lot of people are gonna do it and a lot of people are actually gonna be happy about it including myself but before i explain the three main reasons why i'm gonna rent an iphone as well as thousands of other consumers out there i've gotta let you know why apple has finally decided to do it this year well the main reason according to mark german is that it's gonna make apple more money and the reason for that is because those who will be renting or releasing their iphones will be getting automatic upgrades every single year whenever the latest iphone comes out and that is a big deal for apple because the average iphone user upgrades their iphone every three years or whenever their screen is cracked or they find the latest iphone to be enticing enough so for apple this is going to be a win-win because they automatically will get a huge number of pre-orders instantly amounting to the number of people on this new rental program mark german also made some calculations showing how much money apple could make by leasing iphones at a monthly rate compared to the outright cash price with apple making as much as eighteen hundred dollars off of an iphone 13 pro max at fifty dollars a month instead of the regular 10.99 price not only that but mark mentioned that apple can also take the old returned iphones and resell them on the secondary market to make extra cash so the number one biggest reason is the fact that apple can make even more money with this new rental program and yes i know that they already have their iphone upgrade program that i'm actually on right now but the new rental program will be a lot different and i'll explain how in just a minute now moving on to the next reason why i think apple is finally going to introduce this rental program this year it has to do with the general economic outlook right now as many of us know inflation has been a hot topic recently with prices of just about everything climbing higher and higher each month gas prices have been climbing food prices have been going up service prices have been climbing rent and housing prices have been climbing in fact home buyer affordability has dropped to its lowest level since 2008 the year-over-year disposable household income has fallen more than it ever has in the last 30 years and that is all due to high inflation making things worse diesel prices have been skyrocketing which makes it more expensive for truckers to transport food and goods and of course that cost will be passed down to us the consumers and because of all of this going on consumer confidence of the economy is now down to the lowest level since 2020.
Apple also recently reported their first quarter earnings and mentioned that the supply chain issues in china are impacting sales and because of that they could lose between four to eight billion dollars in sales in the current quarter and on top of all of that hashtag recession is now trending on twitter and the reason for that is because the us economy shrank in the first quarter of 2022 which means that we're now officially 50 of the way there in terms of being in a recession now i'm not saying that to scare you guys or say that it's gonna happen for sure but what i am saying is that it could lead to less demand for tech in general including smartphones and that right there is the third reason lower consumer demand which apple analyst and leaker ming chikuo has been warning about for weeks including lowered global smartphone demand so what apple has to do is find a way to make it easier and less expensive for people to continue upgrading their iphones because if we do truly go into a recession upgrading your iphone is the last thing that you're going to be worried about and that is why apple is introducing this new rental program later this year at least according to the rumors especially since rumors are showing that the iphone lineup is going to be getting even more expensive because even apple's margins are getting squeezed so they've gotta increase their prices but now let's switch over to the three main reasons why i think this new rental program totally makes sense for apple and why a lot of people are gonna love it including myself first of all i wanna mention that i'm already part of apple's iphone upgrade program and i love it because i'm planning to upgrade my iphone every single year because tech is a high priority in my life in terms of where i like to spend my money and my smartphone is the number one piece of tech that i use the most throughout my everyday life and on top of that applecare plus is included so i get the peace of mind of knowing that i'll be covered if i do drop my iphone but i think this new iphone rental deal will be even better because apple will make it even less expensive than the current iphone upgrade program which is going to attract a lot of customers and the big reason that i personally think this makes sense for apple is that they can potentially bundle this iphone rental deal with their own apple one services bundle to get people locked into the apple ecosystem which means tons of extra services revenue and for those who are willing to do this apple will sweeten the deal by throwing in some services completely for free because they know that they'll make that money up or more over the years because the customer is locked into the ecosystem so imagine paying 45 a month for an iphone 13 with icloud apple music apple arcade and apple tv plus included that is an absolutely killer deal and that's why i personally will love renting my iphone since i already plan to upgrade every year and yes apple will initially be losing money by offering some of those services for free or at a discount but they'll be locking people into those services and once they get used to them they won't want to cancel and the crazy thing is that even if they're on the fence about canceling one of those services they're not gonna want to because it's part of a bigger bundle with other services that they really care about and their iphone rental and then on the other hand if someone in the rental program doesn't really care for the latest iphone because the feature differences aren't that big well they're already part of the rental program so they might as well upgrade anyway which is obviously great for apple and of course if things start getting tight for the consumer because of a potential recession paying 45 a month for everything including your iphone and apple services is an easier pill to swallow than buying an iphone for 800 or a thousand dollars outright and that is exactly why car leases have been getting so popular over recent years because they're cheaper month to month than getting an actual car loan even if it's not the best or smartest financial choice in the long run it's still easier on the consumer month to month right now it just makes it easier on the consumer's wallet in the short term which is why i think apple is going to be introducing it later this year but once again don't get me wrong apple is going to really sweeten the deal and actually make it worth it for a lot of people and a pretty dang good deal if you want apple's other services as well and apple is willing to take that initial hit because they're counting on eventually making that money back and more through their growing and expanding services business which by the way has much better profit margins compared to apple's hardware business and it's why apple's been putting so much focus on services compared to hardware but of course that is just my opinion so if you've got some other thoughts on this topic please let me know down in the comment section below and if you enjoyed the video click the circle above to subscribe for more videos like this one definitely check out one of those two right there thanks for watching and we'll see you in the next video [Music] you
