Perhaps I’ve become a bit paranoid, but when everyone is out to get your money, a little paranoia seems like the right attitude to have. Who wants my money? Apple, more than ever since hardware sales have stalled.
Growth is a major engine in business success, and iPhone, Mac, and iPad unit sales stopped growing a few years ago. Apple has yet to create the next great market disruption, so decided to milk customers for all they’re worth. Take AppleCare. Please.
Price vs. Cost
Faithful followers of Mac360 know we point out the differences between price and cost when comparing products in the Apple ecosphere vs. those in Windows or Android. Every new Apple product this year has a higher price tag than last year. That means more money for Apple and less for you.
In recent years Apple has upped the price tag for product repairs, too, and that means customers pay even more money for AppleCare insurance. Here’s an example of the sleight of hand.
What does it cost to repair a fully tricked out iPad Pro with the $1,899 price tag? Up to half the price of a new iPad Pro. On the surface that makes consideration to add AppleCare insurance something of a no-brainer.
What do you get?
Every iPad comes with one year of hardware repair coverage through its limited warranty and up to 90 days of complimentary support. AppleCare+ extends your iPad and Apple Pencil coverage to two years from your AppleCare+ purchase date and adds up to two incidents of accidental damage coverage, each subject to a service fee of $49 for iPad and $29 for Apple Pencil, plus applicable tax.1 In addition, you’ll get 24/7 priority access to Apple experts via chat or phone.
Translation: Apple’s per unit iPad revenue just went up.
As Apple gear gets ever more expensive and more difficult for self-repair, repair and service prices have gone up accordingly, and that makes AppleCare a viable– albeit another cost– worth consideration.
I’ll skip iPhone Xs, Xs Max, and iPhone XR because Apple’s iPhone Upgrade Program already includes AppleCare (built-in to the monthly payment; you still pay more, just not interest on the ongoing loan).
The same issue of price vs. cost is apparent on the new MacBook Air. I priced a new model with extra RAM, faster Intel Inside, and larger SSD storage. $1,799. Repair of the display or motherboard (or, worse, to get a speck of dust out of the butterfly keyboard) could be as much as one third the price of replacement.
AppleCare? $249 for the Mac.
Every Mac comes with one year of hardware repair coverage through its limited warranty and up to 90 days of complimentary support. AppleCare+ for Mac extends your coverage to three years from your AppleCare+ purchase date and adds up to two incidents of accidental damage coverage, each subject to a service fee of $99 for screen damage or external enclosure damage, or $299 for other damage, plus applicable tax.
The $4,999 iMac Pro has AppleCare at $169. Why less? iMacs sit on a desk while Mac notebooks have legs and move. Guess which one is more prone to breakage? A Mac mini has AppleCare at $99. iPhone Xs Max maxed out? $9.99 a month for two years, or $199, but with an option for $14.99 a month for additional theft and loss protection.
AppleCare is a protection racket because it costs so much to repair Apple gear that insurance looks like a good deal.
Before co-founder Steve Jobs returned to Apple in 1997 he was asked about problems in the company he helped to build:
Instead of following the original trajectory of the original vision, which was to make the thing an appliance and get this out there to as many people as possible, they went for profits. They made outlandish profits for about four years… What that cost them was their future. What they should have been doing is making rational profits and going for market share.
Apple in the 21st century is not about marketshare. Apple under Tim Cook is about profits and AppleCare– combined with difficult to repair products– is yet another profit center. Buy a new Apple product without AppleCare and the cost to repair it
could will give you a bad day.