Buy vs Subscribe - how to get the education iPads you need
iPads have been much lauded by those in edtech for their ability to put creativity front and centre of classroom life.
With a seemingly endless amount of education apps and content to power every curriculum need, it’s easy to see why.
Many schools have them, and those that don’t probably wish they did. But affordability is a real factor. Schools are increasingly asked to do more with less. In many cases, budget has become a barrier to progress.
This fall in funding has meant there’s been an emergence of different ways for schools to get their hands on the iPads they want. In this article, we’ll explore one of them - subscription - and compare it to the old fashioned capital purchase model that schools have long been accustomed to.
What is a subscription?
Ultimately, it is a fancy new word for rental. Typically, a subscription covers the iPads, cases, charging units and continuing professional development in a single quarterly payment.
iPad subscription vs Purchase
This table below outlines the main difference between the a subscription and purchase mode.
| Subscription | Purchase | |
|---|---|---|
| Total cost | Less | More |
| Commitment | Medium term | None |
| Cashflow impact | Light | Heavy |
| Futureproofing | Yes | No |
| Ownership | No | Yes |
We will now delve into further detail by exploring each one of these in turn.
Total cost
Unlike consumer credit, iPad subscription does not result in any eye watering Annual Percent Rate of Charges (APRs) that massively push up the overall amount you pay. In fact, getting your iPads through a subscription model will typically cost you less than buying them. This because of residual value. Residual value is the amount that the technology is worth at the end of the agreement term. Because iPad is a highly desirable piece of kit, made by the world’s most valuable brand, they hold their value. There is a very healthy second user market as a result, which in turn means each iPad still manages to reduce the overall cost of a subscription despite being not-so-shiny at the end of the 3 years.
Commitment
WThe subscription model only works for the people providing them if there is a contractual commitment across the whole term. Typically a subscription will be over the course of 3 years, although two years is often an option too. Some people are put off by such commitments, but very few schools and colleges are in a position to refresh their iPads any quicker than that if they bought them outright. A device refresh of 3 or 4 years is quite typical in UK education, so the subscription period probably falls in line with what most educational organisations have historically experienced.
Cashflow impact
One of the main benefits of the subscription model is that it frees up cash to spend on other critical investments: whether that’s a learning resources, sports equipment or a leaky roof. With a subscription model, you pay for the value received from the iPads as you go along on a quarterly basis. This neatly spreads the cost over the subscription term, making for better budgeting visibility in years 2 and 3. When you buy iPad upfront, you have to find the cash upfront. As we mentioned before, it's a tough ask for schools and colleges that are being put under increasing budgetary pressure.
Futureproofing
Because of the predictable nature of the payments, and the 3 year term, subscription agreements usually come with the benefit of roll-on and roll-off upgrade paths. To put it another way, you will usually be able to replace your iPad estate with brand new ones after 3 years and continue paying the same amount you’ve been paying previously. This gives your school or college a real end user hardware strategy that is driven by a firm 3 year refresh cycle.
Ownership
One thing to be aware of when comparing iPad subscription with purchasing iPads is ownership. With a subscription model, you will never own the technology outright. You are ultimately paying an underwriting finance company the rental figure each quarter for use of the the devices. This means at the end of the term you do not get to keep the technology, it goes back to its rightful owner. This leaves you, as we mentioned before, to get your hands on whatever incredible technology Apple will be launching to the market in 3 years time rather than being stuck with old tech and searching out a big lump of capital budget to get some new ones.
Which is right for my organisation?
When it comes to choosing between the subscription and purchasing model, there are a number of factors to take in. There is no right or wrong approach that blanket applies to all schools and colleges, it very much depends on your current device estate, the budget you have available and your attitude to new technology. For many educational establishments a subscription model provides the only viable option to get their hands on a class or half-classroom full of iPads - so it is definitely something for you to at least explore when you look at your next tech investment.
Get in touch
If you are interested in learning more about how subscription might help you get your hands on the classroom iPads you need this summer, get in touch now.
