Report: Apple's Cook Bullish On Subscription Development

Apple investors have speculated for years about the possibility that Apple could sell hardware, like the iPhone, on a subscription basis.

It’s been a hot topic of conversation among analysts because investors tend to value the predictability of recurring revenue, reports CNBC.

Under the argument for an iPhone subscription, which some people call Apple Prime after the Amazon program of the same name, Apple would bundle hardware upgrades with services like iCloud storage or Apple TV+ content and hardware for a single monthly fee. This would let it switch iPhone sales from a transactional model to a subscription model, potentially driving the stock price up without having to increase product sales or prices dramatically.

During Wednesday’s earnings call, when analyst Toni Sacconagi asked about the idea of a prime subscription, Apple CEO Tim Cook did not shoot down the idea. In fact, he suggested that something like it was already in effect.

″In terms of hardware as a service or as a bundle, if you will, there are customers today that essentially view the hardware like that because they’re on upgrade plans and so forth,” Cook said during an earnings call. “So to some degree that exists today.”

Cook went on to say that Apple sees it as a major growth area, using bullish language.