Apple plans to build its streaming service by selling other people’s content
“I made this…”
“Whatever happens on your Apple TV comes from elsewhere…” Hmm, this isn’t half-as-snappy as the “Whatever happens on your iPhone, stays on your iPhone” tagline Apple, but it’s probably truer. On Monday, Apple will unveil its streaming service, which reportedly won’t be a Netflix-competitor.
Instead, the streaming service will mostly be a storefront for other streaming services, according to ReCode. If you were expecting a full-fledged library of content to take on the incumbents of the video streaming world, you’ll be disappointed. ReCode’s sources say that the focus of Apple’s streaming service at launch will be a one-stop shop storefront for subscription services from other companies, just like how iTunes is a storefront for other people’s music, or the App Store is a storefront for other apps.
While there will be some Apple-produced content on the service, those shows will likely be bundled with other services, as added-value giveaways to existing users of iPhones, other Apple devices, or subscribers to the other services on the new storefront. Think of them as the free gift with purchase, as a way to tempt new users to switch their subscription billing to Apple from whichever services they’re currently using.
This is a shrewd move by Apple to create more revenue to bolster lagging hardware sales
All the while, limiting the amount of initial outlay it needs to spend. It’s also the trend that the market is going towards, Amazon, Facebook, and Comcast have all launched similar storefronts for other companies services, finally realizing that a cut of overall subscription fees is better than a zero percent cut of subscription fees when customers go elsewhere.
With the name recognition of Apple alone, I can’t see this failing. There are 1.4 billion users of Apple devices right now. If like Apple Music, only a small percentage of those switch their subscriptions to the new streaming service, it’s going to rake in money.
But wait, there’s more
Plus there’s a twist – Apple will be the one hosting and serving the streams sold through its storefront. That gives it instant access to metrics such as viewing statistics, essential for the longevity of the service.
It also means that Apple will be building its own server network, similar to the one that Netflix uses to serve content. Building that network will lay the groundwork for Apple if it decides to move fully into streaming video and other content.
We’ll find out more Monday, March 25 at 1 p.m. ET, when Apple’s keynote starts.
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