Apple Needs A Bundling Option for its Upcoming Services 

Photo Credit: Apple

 

Apple has numerous new services slated to become available later this Fall. Apple Arcade and Apple TV + (Plus) will be joining the ranks of Apple Music, News (+), and iCloud. These services are here to provide content and experiences for iOS and MacOS users across a variety of Apple devices. Apple is shifting much of its branding power behind these services in an attempt to bring in new streams of revenue for the company. It’s no secret that smartphone sales are becoming stagnant across the spectrum, including the iPhone. With customers demanding more and more features from phones, the cost of making them has intern gone up dramatically, as have the prices that customers pay. Smartphone users are holding on to their phones longer and not upgrading as often as they used to. Apple and investors are hoping that this push for services will help recoup revenue lost from stagnant iPhone sales.

As of June 2019, Apple has persuaded 60 million people to sign up for their Apple Music subscription service. Those numbers are in contrast to Apples biggest competition in the music streaming industry, Spotify, which has over 200 million active users. Spotify, however, has a free ad-supported option for music streaming and about half of their user base is using their free model. Spotify still has a remarkable 100 million paid subscribers to its premium service.

Apple isn’t only trying to get a slice of the music streaming pie. Apple is also gunning for the likes of Netflix and Amazon and the video streaming industry. Apple intends to compete with these media giants by creating their original content and releasing it on their streaming platform, Apple TV +. Unlike Apple Music, Apple has to create its content, which, as Netflix and Amazon have discovered costs billions of dollars. Not only is creating this programming expensive but its also a massive risk. These shows and movies have to resonate with audiences, develop a following, and most importantly be critically acclaimed and win awards. Unlike Apple TV+ Netflix and Amazon have TV shows and movies that aren’t their original content. This means all they had to do is pay for a license to run the show. The Alternative would have been funding the show from the ground up, which is significantly more expensive. Of course, Apple is free to pursue this route as well, however, the owners of popular content like Disney want their segment of the streaming market. At the end of their contract with Netflix, Disney is pulling all of their properties from the platform and is launching their own this Fall called Disney +

Disney knows the steaming industry is crowded and highly competitive. If you look at Disney’s acquisitions over the past couple years like Marvel, Star Wars, 20th Century Fox, and ESPN, it should all be clear as to their motives. Owning these properties means they own the rights to stream them without having to pay licensing fees. Disney is taking full advantage of the properties they have control over and are bundling them into one easily accessible package.

Apple is spending an estimated 6 billion dollars on it’s streaming and services efforts. Apple certainly has the cash in excess to take these kinds of risks. I, however, think Apple should follow in Disney’s footsteps to their approach to services, and that is bundling! For a limited time like Disney Plus, or more of a permanent fixture, Apple should bundle a few of their various services with each other. For example, I am a subscriber to Apple Music myself and a Publisher on Apple News, I, however, am not subscribed to Apple news plus. However, if Apple offered a bundle of both news and music for $15 a month instead of the $20, it would be separately, I would likely go for that option. I can see parents considering an Apple TV + subscription, and perhaps their children want Apple Arcade. I feel more parents would more likely add Apple Arcade if they could get access in a bundle. Who knows, Apple customers might have been waiting in mass for these services and won’t require any packages or other offers. I, however, am on a tight budget, and with all the new players entering the streaming market, each company needs to persuade customers as to why theirs is the best.