APPLE’S NEW SUBSCRIPTION MODEL SAVE OR SCAM FOR CONSUMERS? RYAN MCCONNELL Bloomberg first reported on March 24, 2022 that Apple Inc. was planning a subscription service for the iPhone and other hardware products. This will be a major shift away from hardware ownership into something more closely resembling an automatic lease on Apple services and products. The impact of this plan on consumers will be different depending on usage. This new form of payment could fundamentally change the landscape for technology accessibility, as well as the future of right-to-repair laws. Hardware law, at this point in time, has seen some steps forward—such as the introduction of the right-to-repair legislation on Feb. 3, 2022—but has also taken some steps backward, as seen in the recent case against Gary Bowser, who modified Nintendo consoles to play pirated content. For those who wish to repair and modify any kind of electronic device, hardware and vehicles, things are looking positive in terms of legislation. However, Apple’s new, proposed subscription model may be a method to bypass such laws before they even come into existence. For comparison, we are currently seeing similar issues within the housing market, as it relates to housing affordability. According to a survey by Freddie Mac, housing affordability continued to drive purchase and rental decisions for homes, with new homeownership down from 31% in Jan. 2016 to just 16% in Aug. 2019. Tenants typically are not allowed to clear their own clogged drain—even though they might still have to pay for it, depending on what is described in their lease agreement. If you rent a dorm or apartment, you may not have any options for how to fix it. This might sound innocuous, until realizing that property managers—and the maintenance staff hired by the managers— will not operate outside of typical Monday–Friday office hours. Even if a tenant calls their designated emergency maintenance hotline, there is no guarantee staff members will arrive until the following Monday. If you own a home, however, you are responsible for its maintenance. While you are the one paying for any costs associated, maintenance can be done independently to cut costs, or called in immediately for repair. Homeownership also allows greater creativity and modification of one’s home, such as painting walls or installing different fixtures. If hardware products, like cellphones, shift from ownership to rental subscription models, this could significantly change what kind of autonomy an individual has over repairing or modifying their own devices—much like a homeowner’s right to modify
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LEO CLARK
their own house. Jailbreaking is a good example of this. Jailbreaking allows users to customize and modify their devices in such a way that Apple typically restricts, turning the device into more of a computer than a phone. Doing so would break the warranty on the device, and is strongly discouraged by Apple because of security concerns. However, jailbreaking is often done with older iPhones, to change specific settings that Apple doesn’t allow users to do or to extend the mobile phone’s shelf life. Apple has a list of devices that no longer get security updates, making security concerns an unsubstantiated argument for older models. In theory, this form of modification could easily violate the terms of a hardware lease. Since Apple is both distributing the subscription and the devices, it could have the power to indefinitely bar individuals from signing future contracts, preventing consumers from ever using an iPhone again. The same level of punishment could be leveled at those who repair iPhone screens or replace iPhone batteries without the prior approval of Apple. Even for independent repair technicians, Apple has a stringent certification process—and any repairs made by individuals without Apple’s certificates are punishable by law. While these are serious concerns, Apple’s hardware
subscription may turn out to significantly increase accessibility. As households are continuously forced into a paycheck-to-paycheck lifestyle, many simply can’t afford to save upwards of $1,000 for a new phone, let alone consistent upgrades. If collaborated on with cellular companies, this project could reconfigure a household’s phone bill in such a way to allow consumers to affordably increase their monthly payment in exchange for the newest iPhone models that would otherwise be inaccessible. Affordability is at the core of this payment model, and is a concern that accounts for more of the iPhone-user population than just those who repair them. Apple’s subscription project is still under development, so it is unclear whether this would allow for more affordable hardware in the long run. Once it is released, it could be similar to payment plan models that cellular carriers provide, creating a fixed, monthly payment plan directly through Apple. It could also run in the form of a lease agreement where the subscription model rescinds ownership, but provides automatic free upgrades to the newest devices. For now, it is up to the consumers to determine what is more important to them—ownership or affordability.
PSU Vanguard • APRIL 13, 2022 • psuvanguard.com
