Apple's iPhone Upgrade Program was the company's most disruptive news

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Summary: Apple found yet another way to cut carriers out of the equation with its iPhone Upgrade Program. It can be cheaper than carrier installment plans and gives Apple more of the customer relationship.

Earlier today, after Apple introduced its new iPhone 6s and 6s Plus, I took a look at the "should you upgrade?" question. Current owners of the iPhone 6 and 6 Plus are probably better served by sticking with what they have.

But I also noted that Apple has a new iPhone Upgrade Program that's worth the look. And it may be even more disruptive than the technologies found in the company's next iPhones.

At this point, all of the four major U.S. carriers have installment plans available for handsets.
That's because we're moving away from subsidized hardware and two-year phone contracts. Apple mentioned this, mainly because it can't really keep showing the price of iPhones at $199, $299 and $399 when most people aren't buying phones on contract.
Enter the iPhone Upgrade Program.
It's very similar to what the carriers offer today but it might actually be a bit cheaper. I looked at the program prices and compared them to the installment plans of AT&T, which is my carrier.
Here's the breakdown:

iPhone 6s 16 GB
iPhone 6s 64 GB
iPhone 6s 128 GB
iPhone 6s Plus 16 GB
iPhone 6s Plus 64 GB
iPhone 6s Plus 128 GB
Off-contract Price
$649.00
$749.00
$849.00
$749.00
$849.00
$949.00
AT&T Next 12 (monthly)
$32.45
$37.45
$45.45
$37.45
$42.45
$47.45
iPhone Upgrade Plan (monthly)
$32.41
$36.58
$40.75
$36.58
$40.75
$44.91

At least with one carrier -- I haven't checked the others -- Apple's monthly pricing is actually favorable. And it includes AppleCare+ for hardware mishaps.
Even better -- if you're Apple, that is -- it removes the carriers further from the customer. Anyone using the iPhone Upgrade Program has a direct hardware relationship with Apple and in a way that encourages yearly updates. That's key because the upgrade cycle has been slowing of late.
In the end you're still renting an iPhone. The difference is that you're renting it from Apple with the new plan, and it could save you money over time compared to the carrier's installment plan.
Note that Apple's iPhone Upgrade Program works through a 24-month installment loan through Citizen's One and will require eligibility.

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