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Apple now plans to dive into the showbiz world by launching its Apple TV+ movie and TV subscription service by November to compete with Amazon, Netflix, Disney, and AT&T-owned HBO.
In March 2019, Apple said that it plans to introduce a streaming service dubbed Apple TV+. However, no details were revealed in that announcement. Now, the latest report by Bloomberg suggests that Apple wants to roll out the Apple TV+ movie and TV subscription service by November. In that context, the company has committed over $6bn for original shows and movies in streaming wars ahead of that launch.
The ballooning budget strives to catch up with the leaders in this space including Netflix, Disney, and AT&T-owned HBO. For many years, the iPhone maker has been preparing to dive into the media industry. It even hired two renowned executives from Sony Pictures Television, Zack Van Amburg and Jamie Erlicht, to lead the charge in 2017.
Initially, the two employees were given $1 billion to commission original content in the first year. However, the budget has now grown to surpass $6 billion. For instance, the company has spent hundreds of millions on “The Morning Show” that features Reese Witherspoon, Jennifer Aniston, and Steve Carell. It is believed that the amounts per episode are higher than those of “Game of Thrones”. And “Game of Thrones” reportedly cost $15 million on average per episode of the final season.
The company plans to introduce several shows and then expand its catalog more often in the coming months. Unconfirmed reports suggest that a free trial is likely while Apple expands its library. Once it establishes itself in the market, the company may charge monthly subscription fees of $9.99. That figure comes to mind as it aims to reach $50 billion in service sales by 2020.
With its entry into video subscriptions, Apple is considering different release strategies for shows. It thinks of offering the first three episodes of some programs and then follow it up with weekly installments. Netflix releases whole seasons at once, while AT&T’s HBO and Disney’s Hulu often release episodes weekly. The new TV service is scheduled to launch worldwide in more than 150 countries.
Apple TV+ will join Apple News+, Apple Music, the upcoming Apple Arcade gaming service, and iCloud storage subscriptions services existing in Apple’s portfolio. The company also gets recurring revenue from products like its bank-operated iPhone upgrade program and AppleCare extended customer service. Revenue may also start coming from the Apple Card that is to become a new word in the sphere of internet banking.
If Apple sets the pricing for Apple TV+ at $9.99 a month, it will match the price set for Apple News+ and Apple Music. Amazon Prime and Netflix charge just $8.99 while Disney+ aims at $6.00 when its service debuts in November. Analysts believe that Apple TV+ may top 100 million subscribers in the next 5 years. That, in turn, will pose a major challenge to Amazon and Netflix.