By
Godfrey Benjamin
April 23rd, 2024
The plan by Apple to launch the series of subscription services for its hardware product is the company’s own way to get a competitive advantage over other rivals in the space.
American multinational technology giant Apple Inc (NASDAQ: AAPL) is recording a significant slowdown in its plans to launch a number of hardware subscription services. According to a report by wccftech, Apple is looking at launching a service that will enable its iPhone customers to finance their purchases using the Apple Card.
Apple Inc’s Hardware Subscription Service
Amongst the programs Apple is looking at floating include the Apple Pay Later offering, a variant of the popular Buy Now Pay Later (BNPL) financing model. Also, the tech giant wants to launch an Apple Card Savings Account, Apple Pay Monthly Installments as well as an iPhone subscription program that is yet to be revealed.
With the global economy experiencing a unique strain over the years, the launch of these subscription services is the tech giant’s way of keeping its high-end products attractive. With the purchasing power of consumers largely reduced following higher inflation and reducing dollar value, Apple expects the BNPL offering will help keep its products flowing to the customers that needed it so much.
With months into their respective developments, the delay per the reports is now largely attributed to engineering challenges.
“Both of those services remain underway at Apple, but it’s clear that the financial push has proven more difficult than expected. I believe the delays to all four initiatives stem from engineering challenges, as well as work on a next-generation financial system that will support them.”
According to the report, Apple’s corporate employees are said to have been testing the Apple Pay Later feature, and the offering was recently opened to the retail employees of the company.
“There have been recent signs of progress. After a delay of several months, the company is preparing to release the first version of Apple Pay Later to consumers. Several weeks ago, it started allowing corporate Apple employees to test the feature. And earlier this month, it opened that up to retail employees – essentially creating a test group with tens of thousands of people.”
Apple Looking to Get a Competitive Advantage
The plan by Apple to launch the series of subscription services for its hardware product is the company’s own way to get a competitive advantage over other rivals in the space. With the likes of Samsung Electronics Co Ltd (KRX: 005930) and Alphabet Inc (NASDAQ: AAPL) as some of its core rivals, the ability for users to buy products and pay at a later date can help it sustain its bogus revenue generation.
Apple reported a disappointing total revenue of $117.15 billion as against the $121.10 billion estimated, down 5.49% year over year consensus from Refinitiv. In a statement earlier this month, CEO Tim Cook pointed out the harsh macroeconomic environment as a key reason that fueled the reduction in sales and eventual revenue generation.
Should its planned hardware subscription services go live, more users will be empowered to make purchases, thus helping lift its bottom line in the coming quarters.