Samsung may be launching this leasing program in the next several months, although that timeline may accelerate, the executive said.
Carriers have been moving away from so-called subsidized contracts, where the cost of a new smartphone is hidden in the monthly service plan fee and the cost of a new device appeared to be anything from free to $200. With true purchase costs now much more visible, manufacturers have a strong incentive to offer attractive financing in order to encourage regular upgrades.
Samsung, though, has a stronger motivation than Apple. While Apple has been enjoying record iPhone sales, Samsung has been struggling to compete with both Apple and Chinese Android handsets – its smartphone business seeing a 37.5% drop in operating income in Q2 and the company reportedly planning to lay off 10% of its workforce.
While the terms of Samsung’s financing are not known, it’s likely the company will adopt a similar approach to Apple, where you pay off the cost of the phone over two years but can upgrade to a new model every year. Apple’s plans start at $32/month.