Alex Sherman, CNBC:
Apple is preparing a new digital video service that will marry original content and subscription services from legacy media companies, according to people familiar with the matter. Owners of Apple devices, such as the iPhone, iPad and Apple TV will find the still-in-the-works service in the pre-installed “TV” application, said the people, who asked not to be named because the details of the project are private.
The product will include Apple-owned content, which will be free to Apple device owners, and subscription “channels,” which will allow customers to sign up for online-only services, such as those from HBO and Starz.
Paralleling Amazon Prime Video, if you buy into the Apple ecosystem, you get Apple’s original content for free. This seems a reasonable strategy, as it reduces the pressure for Apple to have to produce content worth paying for, à la Netflix.
Seems to me, this is Apple easing their way into a market they have no experience with, reducing their chance of failure to almost zero. Over time, if they find the path to creating truly compelling content, they can ease into another business model.
They should have done this/should be doing this with iCloud as well. iCloud should be free with as much storage as would be needed to back up each device you own.
Another service, I‘m afraid, that won‘t see a lot of international distribution (like siri on the aTV, apple news, apple pay, EKG on the apple watch, …)
Not what I expected, given the focus on services revenue. Seems like a temporary move until they’ve built up enough content to make a compelling subscription service.
I wonder if/how will they make the content available on other platforms?
I wonder. Amazon gives away Video with Prime… but then Amazon makes money from other aspects of Prime.
When Netflix started this, they were entering a much different field; the only other purveyor of high quality original TV was HBO and that required, at the time, a cable sub.
At this point I’d need to see an Apple Video offering bundled into Music or something. One of the issues with waiting to get it really right is that they’re entering a world where there is a glut of very high quality TV. Between Netflix, Hulu and Prime Video I’m set… and I could add Showtime, HBO, Starz and more if I wanted. Oh and Disney is launching a sub service that will probably be pretty compelling too. Sheesh.
I can’t (or rather won’t) pay $10 or so for each of those every month. At some point, I just run out of time to watch everything that they offer.
This also partly, but not entirely, addresses one of Apple’s biggest weaknesses in content distribution: the high cost of entry. YouTube, Netflix, and Prime all have apps available for low cost or functionally free devices like Roku and smart TVs and video game systems. If you want Apple’s content there’s no alternative to expensive Apple hardware, except a dedicated PC running iTunes.
They still need to address that weakness, either with apps for other devices or their own low cost Apple TV dongle. But this does fit with their philosophy. Use services to sell devices for profit, rather than selling the services for profit.