[Update] iTunes Giftcards Can Now Be Used For All Apple Products, Including Devices (Wow!)

(Update 8/2/20: We have confirmation that (like Amex does) Chase has been coding Apple ID load as streaming for the 10x promo – source. That’s a sweet 10x UR points on Apple credit, up to $1,500, which could be useful to some. My guess is the coding will remain constant, but there’s always a risk that the coding could change, so keep the possibility in mind.)

iTunes gift cards can now be used on iTunes and for any hardware and products at Apple stores and on apple.com, such as iPhone, Mac, Apple Watch, etc. Wow!

Single Apple Gift Card

In a major shakeup in the iTunes/Apple gift card market, Apple unveiled today a change whereby iTunes and Apple gift cards are interchangeable.

Previously, iTunes gift cards were only usable in the app store for things like music/movie downloads and software downloads, but were not able to buy Apple products in Apple stores or on apple.com, such as iPhone or Mac. And Apple gift cards were not usable for app store purchases. Going forward, there’s a single gift card which can be used for both hardware and software.

This change is already live, and the apple.com system already allows applying iTunes gift cards at checkout. It shows a limitation of 8 gift cards per checkout, but  you can apply the cards to your iTunes balance and then just use the combined balance, so there’s essentially no limit.

Existing Cards & Balances

Existing iTunes/Apple gift cards get the same usage as new cards to be issued, so you use your existing iTunes cards for Apple hardware products. Also, your iTunes balance can now be used at checkout on apple.com (and presumably in Apple stores too).

Analysis

The reason this is all exciting is because iTunes gift cards are frequently available at discounts and are passed around people quite a lot, whereas Apple gift cards are much more rare and can often be resold near their face value as people value Apple products quite a lot.

Before you get too excited: my guess is that Apple made the decision to stop offering iTunes gift cards at steep discounts like they’ve been doing until this point. (Maybe this was partially spurred by the lawsuit against them about iTunes gift cards being used for fraud.)

And, so, I see can see a few angles here, from a practical perspective:

• If you have a balance in your Apple ID/iTunes account, it’s much easier to use now.
• If you are holding iTunes gift cards for resale, you just made a lot of money; while previously you can maybe get 70-90% (depending on your relationships), you should now be able to get much more.
• Maybe Apple will still run some smaller sales, and these cards are now more interesting.
• Lots of people give out small iTunes gift cards for holidays, and many recipients weren’t necessarily interested in digital goods from Apple, but now, you can save up all the small cards to reduce your next iPhone (or whatever) purchase.
• My feeling is that there’ll be some nice angles on this specifically for the next few weeks/months as businesses – and Apple themselves – fully catches up with the change. For example, some places (e.g. a shopping portal) might still offer steep bonuses to take payout in iTunes gift cards. These will probably peter out over time, but likely lots of the systems will still be in place for the time being. Or maybe some points app or credit card allows you to redeem iTunes gift cards at a discount. Etc, etc.
• Hopefully iTunes purchases will still trigger streaming credit bonuses and bonus categories, such as the $20 monthly streaming credit on the Platinum card. Assuming no coding change, these can now be used to save up for an Apple hardware purchase, like an iPhone.
  • Someone points out that Chase Sapphire Reserve is offering 10x points on streaming services. If Apple ID load would code as streaming with Chase, you can buy up to $1,500 in Apple load and get 10x UR points. At a minimum, you should be valuing that at around 15% off due to 1.5 Payback option. That’s a nice discount on an iPhone! (Update: we now have confirmation that (like Amex does) Chase has been coding Apple ID load as streaming for the 10x promo – source.)
• Even without discounts, hopefully Apple will continue to make iTunes gift cards available at grocery stores and office supply stores and that like. That could mean nice discounts/earnings with cards that offer bonus categories there, and could amount to a nice savings on your next iPhone (and possibly some gift card reselling opportunities as well). Also, if your grocery store has a fuel points program, it’ll be even more lucrative.
  • Similar opportunity with deals on Amazon: assuming Amazon continues to sell iTunes gift cards, you can use all of those shop-with-points deals on iTunes gift cards, and get major discounts on your next iPhone purchase (or resell the gift cards to someone who buys Apple products). Also, you can use any credit cards that have an Amazon category bonus (e.g. Freedom quarterly category) on iTunes gift cards.

After all is said and done, be sure you have a plan for what to do with Apple gift cards; don’t buy these without a clear and profitable liquidation plan.