Why AppleCare is so sticky

It’s not just the adhesives help make its devices hard to repair.

From David Gershgorn’s “Wait, there’s supposed to be a gadget repair market?” posted Thursday as a Fortune newsletter:

If you want to fix an iPhone that’s in warranty, you have to go to Apple or an Apple-authorized repair shop. Apple also requires that repair shops make their financials available for Apple to review, pass tests for proper repair, and to open a line of credit with Apple Finance. Only then can the shop even buy genuine Apple-made parts, which Apple can still sell at whatever price it chooses.

Even repair shops that want to buy Apple parts to fix phones out of warranty must sign historically-draconian contracts. One contract stipulation, Motherboard reported in 2020, stated that if a shop used more than 2% of non-genuine Apple parts, it could be fined $1,000 per transaction and reimburse Apple for the cost of the audit that uncovered the supposed malfeasance, too.

This is only half of it. We’re going to pick on Apple a little more, since it’s the biggest offender among makers of popular consumer tech products. The company throws up a ton of roadblocks for repair shops to fix the devices it makes. And by Apple setting the cost for genuine parts, phone repairs even at authorized repair centers can be more expensive, too. Suddenly, the most cost-effective way to ensure you don’t foot the bill for a $300 repair is to buy the company’s AppleCare insurance, which highly subsidizes the cost of common repairs like screen replacements.

Apple has a rationale for these stringent rules. It has argued that making these repairs itself and by thoroughly-vetted providers ensures high-quality parts are used, and maintains the quality the company is known for. Apple has also argued against Right to Repair legislation, saying it could force companies to give up trade secrets…

Apple makes the parts, sells the parts, sets the prices, and on top of that commands huge customer loyalty. If Apple says it’s the only one that can repair an iPhone, people listen.

This sets up the FTC for an uphill battle. If commissioners are serious about encouraging a bigger repair marketplace, the FTC must seriously regulate how companies make their products and sell parts. That means taking on some of the most powerful tech companies, which have been working against the Right to Repair for years.

My take: A battle royale worthy of Mythic Quest.

See also: Apple’s tools, glue and diagnostics in FTC’s sights

6 Comments

  1. Fred Stein said:
    The FTC has a much bigger problem. How to you fix a problem that no longer exists?

    When 90% of teenagers had broken screens, they wanted an option other than Apple.

    As for telling Apple how to make iPhones, good luck. The FTC has to take on Samsung, etc. Might be a good education for the FTC’s current academics.

    3
    July 22, 2021
  2. Watch the sudden uproar for more regulations around who does repairs when a knock-off counterfeit lithium battery catches fire after a 3rd party uncertified phone repair job, any make, any model.
    You think Tesla owners tinker or take their EV to Ray Magliozzi for repairs? (NOTE: I miss Click & Clack, The Tappet Brothers) Will 3rd party Blue Origin/Virgin Galactic rocket repairs take off next?

    2
    July 22, 2021
  3. Jerry Doyle said:
    “…. If commissioners are serious about encouraging a bigger repair marketplace, the FTC must seriously regulate how companies make their products and sell parts.”

    It’s not just big tech who covets marketing the continuity of integrity of their products & the servicing of those products. I was studying an in-depth car review on the all new 7th generation Mercedes Benz S Class 580 4Matic Sedan. The author, a car engineer, remarked that MB has designed & engineered the all-new S Class model to be nearly inaccessible by other car mechanics to work on other than trained MB mechanics using specially designed tools with rather progressive dies & unique stamping. The costly under-the-hood components & access to those components will be challenging for many small mechanic shops even if they possess multi-million dollar equipment & have quality personnel working.

    Some of the Right-to-Repair evolved from farmers complaining of down-time (sometimes a day or two) waiting for specially trained John Deer mechanics to travel long distances on-site to repair highly technological & sophisticated tractors used in agricultural cultivation. Local tractor mechanics informed farmers that they could do the repairs faster, if they had access to the needed tools & if their repairs did not invalidate the John Deer Warranty. This battle continues.

    “….This sets up the FTC for an uphill battle.”

    I could enumerate other examples. The point is that the day of the shade-tree mechanic & the small appliance repair worker is mostly obsolete. I’ve stated before in my postings that I have a difficult time seeing the Biden administration’s efforts toward regulating big tech in some of these areas as being successful to any large extent.

    1
    July 22, 2021
  4. Kirk DeBernardi said:
    “Apple has a rationale for these stringent rules. It has argued that making these repairs itself and by thoroughly-vetted providers ensures high-quality parts are used, and maintains the quality the company is known for.”

    Hmmm. ”…maintains the quality the company is known for.”

    What a concept. Sounds like somebody cares about product — ergo “the experience” — integrity.

    Thanks Apple.

    Most premuim experiences in this world come with a price. Besides, is the total count of right-to-repair junkies really something worth fretting about with some form of regulation rape. There are much bigger fish to fry.

    As Sacto Joe so aptly puts it above —

    “Have these folks looked under the hood of their car lately? Raise your hands if you can fix your own car anymore and still pass a smog certification. (crickets)”

    Crickets indeed.

    3
    July 23, 2021

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