Apple working on a hardware subscription service for iPhones

Apple Inc. is working on a subscription service for the iPhone and other hardware products,hardware products, a move that could make device ownership similar to paying a monthly app fee, according to people with knowledge of the matter.

The service would be Apple’s biggest push yet into automatically recurring sales, allowing users to subscribe to hardware for the first time — rather than just digital services. But the project is still in development, said the people, who asked not to identified because the initiative hasn’t been announced.

Apple shares climbed to a session high after Bloomberg reported on the news Thursday and closed up 2.3% at $174.07. Though the stock is still down 2% for the year, Apple has now posted eight straight days of increases — its longest streak since November.

Adopting hardware subscriptions, akin to an auto-leasing program, would be a major strategy shift for a company that has generally sold devices at full cost outright, sometimes through installments or with carrier subsidies. It could help Apple generate more revenue and make it easier for consumers to stomach spending thousands of dollars on new devices.

Already, the iPhone is Apple’s biggest source of sales, generating nearly $192 billion last year — more than half the company’s revenue.

A spokeswoman for Cupertino, California-based Apple declined to comment on the company’s plans.

The idea is to make the process of buying an iPhone or iPad on par with paying for iCloud storage or an Apple Music subscription each month. Apple is planning to let customers subscribe to hardware with the same Apple ID and App Store account they use to buy apps and subscribe to services today.

The program would differ from an installment program in that the monthly charge wouldn’t be the price of the device split across 12 or 24 months. Rather, it would be a yet-to-be-determined monthly fee that depends on which device the user chooses.

The company has discussed allowing users of the program to swap out their devices for new models when fresh hardware comes out. It historically releases new versions of its major devices, including the iPhone, iPad and Apple Watch, once a year.