Neil Cybart: Why Apple TV+ is still free (but not for me)

“My suspicion is that Apple TV+ subscriber engagement is not where Apple wants it to be.”

From “Apple Extends TV+ Free Trial (Again)” sent Wednesday to Above Avalon subscribers:

Online reactions to this news were pretty negative. Many looked at Apple’s willingness to continue extending Apple TV+ free trials and offer additional monthly credits as a sign that Apple just isn’t convinced Apple TV+ is good enough to begin charging subscribers.

There is more to the story.

In my view, Apple TV+ content has been great. There hasn’t been a series or movie that I started that I didn’t end up enjoying and watching to the end. The problem for Apple is that there just isn’t a whole lot of content available… It’s still easy to list all of the shows and movies found on Apple TV+. That is impossible to do with a service like Disney+ and Netflix…

My suspicion is that Apple TV+ subscriber engagement is not where Apple wants it to be as millions of people begin seeing Apple TV+ charges appear on credit card statements. Instead, Apple is willing to eat up the cost found with giving away a few more months of Apple TV+ in order to lower the risk of millions of people unsubscribing (and not watching new Apple TV+ content).

It’s been hard to miss the lack of new content being rolled out for Apple TV+. The pandemic is playing a role here since TV and movie production was offline for a good portion of 2020. While every video content company has faced headwinds from the pandemic, Apple is feeling the harshest impact given the lack of a back catalog and its more curated content pipeline. For context, Netflix has more than 500 video titles either in post production or ready to launch. This includes having more than one new original film being released on a weekly basis.

In theory, as the amount of Apple TV+ content increases, engagement levels will improve and Apple will be in a better position to begin charging for Apple TV+. With that said, it should not come as a surprise that a growing number of people are wondering if Apple will ever charge for Apple TV+. The idea of giving Apple device buyers 12 months of Apple TV+ but letting the promotion roll over with every new hardware purchase is something that Apple has likely at least considered

My take: That’s nice for the roll-overs. Where’s Apple love for those of us who have been paying our way from the start?

12 Comments

  1. Dave Ryder said:
    @PED I’m in the same boat as you!

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    January 20, 2021
  2. Jerry Doyle said:
    Apple TV+ has been a tough nut for me to crack in understanding Apple’s strategy with Apple TV+. Apple desired initially its own original content. That initial strategy since has changed where Apple purchased content to bring aboard. While the monthly price is modest, the content viewing selection is even more modest.

    The competitiveness in this market with really good content from other sources is everywhere. Now, it is “free,” such as excellent content on Peacock if one is willing to have several commercials no longer than 60 second spots and some commercials as little as 30 seconds. For example, Peacock offers the complete six seasons of “Downton Abbey” and all ten James Bond movies were added in December to Peacock for “free” viewing with a 60 second commercial about once every 30 minutes. So, I am thinking how can Apple TV+ compete at this level? To exacerbate matters, I went on Apple TV app to purchase “American Sniper” last evening for $14.99 but the app says “This movie is available free with ads to all Peacock users.” Say what? Why would Apple do this? Apple is against purchasing large film libraries. I could enumerate other disincentives Apple throws up to preclude Apple TV+ from catching on with a viable paying viewer base of subscribers. So, I am mystified as to Apple’s strategy with Apple TV+. Something tells me that Apple also may be mystified, too.

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    January 20, 2021
    • David Drinkwater said:
      Jerry, if Apple is advertising other companies’ wares as “you can get this free over there”, clearly there is a link between a new Apple product user to that service. That link equals money that that service provider pays to Apple. Isn’t that obvious?

      1
      January 20, 2021
      • Jerry Doyle said:
        @David Drinkwater: “…. Jerry, if Apple is advertising other companies’ wares as “you can get this free over there”, clearly there is a link between a new Apple product user to that service. That link equals money that that service provider pays to Apple. Isn’t that obvious?”

        David, my answer to your question above if “… that link equals money that that service provider pays to Apple.” I can’t say definitive the answer is yes, nor you. But let us both say the answer is “yes.” Is that link commensurate with the $14.95 I was prepared to pay to enjoy the movie at my leisure? I doubt so. Let’s say I decided to “rent” the movie “American Sniper,” which I normally do not rent movies; but let’s say that I decided to do so. I ask you then, is the link equal with the $3.99 I would have paid to rent watching the movie on Apple TV+? I doubt so. Something is wrong here on this specific issue of which we discuss. It goes beyond this specific issue, though, David. The whole Apple TV+ strategy perplexes me. Can you explain the strategy. Neil Cybart seems to be perplexed too. I am going to download his podcast on this subject and listen to it as soon as I can to learn what Cybart believes Apple TV+ strategy may be.

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        January 20, 2021
        • Gregg Thurman said:
          In the movie “Miracle on 34th Street” Macy’s Santa was telling children’s parents where they could find hard to get toys for Christmas. People thought it was a Macy’s promotion when it wasn’t, but the goodwill it generated significantly increased Macy’s December revenue.

          I’ll bet there is a large dose of that in continued “free” Apple TV + and referrals to other services

          2
          January 20, 2021
          • Dan Scropos said:
            Great point, Gregg. I’m sure Apple also has internal metrics that will signal when “stickiness” to their TV platform will allow this fledgling bird to leave the nest and fly.

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            January 20, 2021
        • George Row said:
          Jerry, you asked:
          “ …is the link equal with the $3.99 I would have paid to rent watching the movie on Apple TV+?”

          Not immediately, but when I search for something and their response, in effect says:
          “We could sell it to you, but this other channel has it in their freely available content, at the moment”
          it builds builds trust.
          I see this over and over. It builds trust every time. I point it out to family members and now they trust Apple too.

          So when I search and Apple TV gives me a straight price quote, I trust them that a free copy is not easy to find. I am not going to check the broadcast schedules or the listings at the local cinema. I’ll just pay and watch!

          4
          January 20, 2021
          • Gregg Thurman said:
            @George

            A dimension that I hadn’t considered. Thanks.

            1
            January 20, 2021
          • Jerry Doyle said:
            @George Row: Most interesting, George. I owned custom picture framing stores inside of art galleries. I can see where a proprietor who did not provide a specific product or service would send a prospective customer to a competitor, but not when the proprietor has that product or service provision available. Every one of my businesses would have collapsed financially if my store managers said to a prospective customer, “…. we have the product in stock or we provide that service, but you can get it for less down the street at Michaels’ custom picture framing business.”

            I suspect for now that Apple TV+ is a loss leader for Apple until it can experiment and find a way into making it profitable.

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            January 21, 2021
  3. bas flik said:
    apple tv is a bleeder. this will never work. like cars. maybe they do because wallstreet is in love with money bleeding (Tesla, netflix, roku etc etc) projects. real cashflow are not appreciated anymore.

    anyway people make and watch their own content and are less willing to pay for hollywood content. like music. internet is full of free content. music and film. Spotify never made any money.

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    January 21, 2021
  4. Kirk DeBernardi said:
    Moreover I think that the COVID stall in continuous TV production is a main culprit here.

    A hiccup in production could easily be causal of an extension of the free period.

    Also, it’s interesting how people read into this that  TV+ is sputtering when Apple hasn’t released any info on subscriber-count yet. This is akin to the media’s general attitude about  WATCH when it first cracked its shell.

    Apple’s laying its quality towel on the streaming beach to take in some rays, regardless of the big towels already there.

    I just think that the $4.99/ month price is borderline inconsequential to most budgets. A “What the hell” price point.

    1
    January 21, 2021
    • Kirk DeBernardi said:
      I forgot to mention how, if it’s included in an Apple One subscription, it’s a REAL “What the hell.” price point.

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      January 21, 2021

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