A lot of coverage has been given to Apple’s new policy of allowing Chinese customers to pay for their gear in instalments. It is certainly nice to be able to spread the grief over three, six, twelve, 18 or 24 months, especially when interest kicks in only for the two longer periods. But is this much different from the practice of buying an iPhone or iPad on a contract tied to a telecom company?
Getting a cheap phone in return for agreeing a long contract is a form of hire purchase. The tied contract purchaser pays a penalty for the lower initial capital outlay. When you take resale value into account, it is usually cheaper. Yet when you buy a full-price unlocked iPhone and use a much cheaper, monthly renewable telecom contract the overall cost of ownership and use can be much less.
Perhaps, though, this new Chinese policy is an experiment that could be extended to other markets. Apple has a strict no-discount policy and could well afford to give up to twelve months’ free credit. A £2,400 MacBook Pro for £200 a month over twelve months would be an attractive proposition and I am sure it would draw in more customers.
by Mike Evans, 18 January 2013