Apple has announced an aggressive financing program to attract even more iMac buyers for the Christmas splurging season. Even at $1,299, the iMac can sound expensive, but under Apple’s new plan, you could instead pay $30 per month (plus a 14.89 percent annual percentage rate and a loan origination fee). Interim CEO Steve Jobs noted, "For the price of three pizzas a month, you can own an iMac." Admittedly, that assumes you’ll eat three pizzas each month for 67 months, and the total cost of an iMac financed in this way would be over $2,000 (or over 200 pizzas).
Apple also announced that the iMac will now come with Mac OS 8.5, the ATI Rage Pro Turbo graphics controller, 6 MB of video RAM, and Adobe PageMill 3.0.
I shouldn’t be specifically negative about the overall price of financing an iMac in this manner. There’s nothing unusual about the overall cost being much higher when it’s paid out over more than five years, although I’d question the fiscal savviness of anyone who takes the offer. Plus, five years is a long time to finance something like a computer, which becomes increasingly obsolete within six months.
The part of the fine print that I was sad to see, though, was "ISP fees not included." In this year’s April Fools issue (TidBITS-423), I wrote a spoof called "The First One’s Free…" about how Apple would be using a cellular phone service model with the consumer portable Macintosh that might debut at January’s Macworld Expo in San Francisco.
The idea was that Apple could work out deals with ISPs so Macintosh owners could pay a set amount per month for the Internet connection, but the Mac itself would be "free." Although presented as a joke, the idea has some merit, and Apple’s move to this $30 per month financing model shows that the company is willing to consider alternative financing schemes. Apple could even take a page from Gateway 2000’s YourWare program, which lets you finance a PC, include ISP service, and trade the PC in after two years.
I have no idea how well any of these programs might work, and it’s entirely possible that Apple has already run the numbers and decided that traditional computer sales models are best. However, Dell got its start by breaking out of the traditional sales channels, the online sales channel has proven quite successful, and perhaps an innovative financing model would improve Apple’s fiscal fortunes.