As Apple pushes services, a subscription bundle could be in the future
ZDNet’s Larry Dignan tells TechRepublic’s Karen Roby about a potential ‘Apple Prime’ subscription bundle. Read more: https://zd.net/2UMIpNd
Apple’s move to a streaming video and subscription news products highlights the company’s effort to bulk up its services business — already topping a $40 billion annual revenue run rate — but the company may want to consider a larger bundle.
The company’s video service is entering a crowded space with the likes of Hulu, Amazon Video, Netflix and a bevy of other over-the-top efforts. On its own, Apple may have a tough sell without more original content. As bundle of services, Apple’s video effort can be handy. The Apple News effort will bundle magazines and other content subscriptions in a service called Apple News+ for $9.99 a month.
Speaking at an event March 25, CEO Tim Cook said:
“We take the same approach with our services as with our products. Have to be easy to use, designed to keep personal information private and secure.”
Cook’s talk was aimed at Wall Street too. Apple needs investors to value the company’s services unit as much as its iPhone franchise.
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Is it time for “Apple Prime”?
Apple has already proven adept at taking your money on a subscription basis. Its services business, which includes everything from AppleCare to iCloud storage to Apple Music is the fastest growing business in the company.
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Nevertheless, Apple may run into subscription fatigue at some point. The cure would be a bundle.
Consider the following:
AppleCare will run you anywhere from $129 to $199 depending on your iPhone model over two years. 2TB of iCloud storage is $120 a year. Apple Music goes for $120 a year. And now there’s Apple’s video effort, which may land somewhere between Netflix’s $12.99 standard plan, HBO Now’s $14.99 and Netflix’s top of the line $15.99 plan. Call Apple video $120 a year as it tries to gain share.
Add it up and you’re paying $460 a year to Apple in subscriptions should you opt for all of those services. Wouldn’t it make sense for an Apple bundle that would run $300 a year that includes all of those services? Apple could also do tiered accounts ranging from $150 to $300 a year.
Now it’s easy to smirk at this Apple Prime concept, but the customer base would go for it as long as there is value. Apple customers are also accustomed to paying premium prices so a $300 a year subscription may actually resonate. Microsoft 365 is a spin on a software subscription equivalent.