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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 t
by nerdjon 2mo 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 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.
- apercu 2mo ago"You'll own nothing and you will love it"
- illwrks 2mo agoThis is crazy, this is just PCP finance… for a phone!
- enahs-sf 2mo agoIt 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.
- deleted 2mo ago[deleted]
- nerdjon 2mo agoThat 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 2mo ago> 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 2mo agoI 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 2mo agoI 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.
- fckgw 2mo agoThey still have a 12mo lease term if you want to upgrade yearly.
- dgellow 2mo agoWait, do people actually upgrade yearly? I always thought it was hyperbolic
- dbbk 2mo agoI do for my iPhone yes. It's definitely overkill and certainly not recommended for 99% of people.
- fckgw 2mo agoIt'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.
- layer8 2mo agoAround 20% apparently do: https://c9ac71a8282e1fecd95e-f07dbcddcacf0d4c572ea7178ee6902d.ssl.cf2.rackcdn.com/blog/wp-content/uploads/2023/11/How-Often-Do-You-Upgrade-Your-Smartphone_.png https://c9ac71a8282e1fecd95e-f07dbcddcacf0d4c572ea7178ee6902... From: https://www.sellcell.com/blog/how-often-do-people-upgrade-their-phone/ https://www.sellcell.com/blog/how-often-do-people-upgrade-th...
- Danox 2mo agoCrazy the ultimate in short term thinking…
- zwily 2mo agoEvery year since the first iPhone came out. It's sort of superstition at this point. Not sure what would happen if I broke the streak.
- paxys 2mo ago> 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.
- tw600040 2mo agoSomeone who won't have that $433 has no business even thinking about a 1200$ phone in the first place
- paxys 2mo agoHave you met…America?
- PunchyHamster 2mo agowait till you see what people do with car payments
- Zambyte 2mo agoSelling 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.
- frmersdog 2mo agoGenuinely wish I had done so when I lost my job at the beginning of the pandemic. I've dumped so much money into a vehicle that's falling apart, which I've driven probably less than 25k miles since. If you can't justify car ownership with your income, they're a money pit.
- MrGilbert 2mo agoIf 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.
- deleted 2mo ago[deleted]
- dyauspitr 2mo agoIt’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.
- Danox 2mo agoAbsolutely, you pay more people need to take a finance class, or buy shares in Apple, do one or the other or both. Please…
- giancarlostoro 2mo ago> 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.
- wombat-man 2mo agoYeah I switch between android and iPhone sometimes so there's always something I forget to transfer over. After a long enough time I can wipe it and have it as a backup phone.
- giancarlostoro 2mo agoYeah, same, I've consistently stayed on iOS since 2020 but I used to do the same, I had given a relative my "last Android" a few times, but they kept losing it, so I would never get those back at all, and I realized I lost files I didn't backup anywhere, so I stopped doing hand-me-down phones. So many photos from when I started dating my wife, completely gone as a result.
- engineer_22 2mo agoAre 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?
- anonymousiam 2mo agoAside from the financial analysis, there is also the fact that this strategy from Apple will prevent customer churn to alternative phones.
- fishingisfun 2mo agothat doesnt happen lol
- qurren 2mo agoI 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.
- Danox 2mo agoLeasing/renting/warranties is a way of making continuous money from an individual or a company the process is the same. Far beyond the actual/original cost of the item which is why it’s not a good deal for an individual. Once again, taking advantage of short term thinking.
- Spooky23 2mo agoIt’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.
- Danox 2mo agoOver the years, I’ve never bought AppleCare why? Intel iMac 27 inch computer lasted 9 1/2 years. Everything else iPad, iPhone 7 years and more easy…
- musictubes 2mo agoAppleCare is even more important with the lease. If you lose the phone you have to pay Klarna to replace it. There might also be lease cancellation fees on top of that. That is my big problem with leasing portable things. I never get AppleCare because I can self insure. But if I lose the phone 8 months into the lease I am deep in a hole.
- Spooky23 2mo agoThey want their $19.99 so you cover your other stuff.
- futhey 2mo agoSo the buyout price is never going to match depreciation, and in almost all cases keeping the device doesn't make sense. The flip side of this, Apple gets more control of the resale market, pushing more buyers into the new device market. In theory it lets them solve any market problems that emerge where independent resale markets let high quality devices cannibalize sales of new devices.
- gigatexal 2mo agoThis is predatory. I don’t like it. They should just split the cost equally over the number of months so at the end you have paid it off.
- gofreddygo 2mo agoI see this as psychology driven, not math. It pushes people to look at new options and tempt an upgrade at the end of the lease (pay $1000 for a 3 year old mac or just upgrade ?). This also pushes term completion with early termination charges (discourage selling before term ends). And they know money will be tight for their consumers, they can't lower prices anytime soon so give out 0% loans. Following their tradition of screwing the frugal, cheapest options seem to be excluded. Its a subscription model for Apple hardware.
- idoescompooters 2mo agoExcept it's not a higher payment in the end. It's the same as if you just bought it in full, new.