Apple has its sights set on the subscription TV industry

Apple has its sights set on the subscription TV industry Apple has just introduced its brand-new TV app with Apple TV channels. With the new update, it is clear that Apple wants its share of the Subscription TV pie, where rivals Google and Amazon have a strong presence. Will this bolster its subscription ambitions?

Apple is not leaving any subscription opportunity untouched within its ecosystem. The company announced Apple TV channels and an upcoming revamp of the Apple TV app back in March, but its new services -Apple News+ and Apple TV+ - received more attention during the event. Apple had first revealed its ambitions about selling video subscriptions through its TV app last year.

Now, the technology giant has just released a new update to its devices that includes an enhanced version of its TV app with Apple TV channels. The new service offers users access to premium networks such as HBO, Showtime and EPIX, among others. Apple TV channels will be available in more than 100 countries and the company will continue to add more TV networks to boost its offerings.

Channels is different from Apple TV+ - the company’s new SVOD service that will include a lot of original content. Instead, it will be a service that allows users to watch their favourite shows and movies from other networks right within the Apple TV app. This benefits Apple since the users stay within its ecosystem. The only caveat though: users subscribing to networks within the Apple TV app can only access them via the app itself. This can be limiting for those users who dabble with multiple ecosystems.

While the new service will offer Apple another way to boost its services revenue, it has not revealed the share of revenue it will receive from subscribers who sign up to services through its app. Apple will not doubt be pushing for its usual 30% cut, but that has come under fire in recent times. Some other reports have also suggested that the iPhone maker is earning15% from subscribers who sign up for services through the App Store.

New Features on the Apple TV app

Apple recognises that a key part of the subscription TV battle will be won by the user experience, and the company is making sure that it is offering a premium experience to its viewers. In the revamped app, the company is offering a ‘What to Watch’ feature that curates popular content from across the globe. Apple has said that it is using a combination of human editors and algorithms to make these recommendations.

The app has also made visual improvements such as larger thumbnails and dedicated sections for shows and movies, as well as a separate section for kids content. Furthermore, the app now has the option to download content for offline viewing. This will help Apple compete against standalone apps such as HBO and Showtime which do not offer this feature.

Partnerships Galore

The new Apple TV channels will be made available in other ecosystems too. The Cupertino-giant has already tied up with Samsung to make the Apple TV app available on Samsung’s Smart TVs. In addition, Apple TV will also launch on Amazon’s Fire TV, Sony TV, LG TV and Roku devices later this year.

No Subscription Bundle

However, Apple is following an interesting strategy with its subscription TV ambitions. It is not going to offer a bundle like Apple News+, where a single pricing plan of $9.99 per month gives access to over 300 newspapers and magazines. Instead, viewers will have to subscribe to individual networks separately. While there are no discounts being offered, users will be able to share the service with up to 6 people in their families. Did Apple miss a chance here by not offering a convenient subscription bundle?

What about Subscription Billing?

With no subscription bundle in place, it will be interesting to see the subscription experience Apple is able to deliver with the new Apple TV channels. Accessto multiple networks will require a seamless subscription billing experience – the kind propagated by platforms such as Netflix and Amazon Prime.

Apple generated nearly $11.5 billion in revenue from its services business as we reported in our subscription roundup, but it remains a relatively new player in the subscription industry. Can the hardware giant transform into a subscription giant? Only time will tell.
Also read: FAANG companies sinking their teeth into subscriptions
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