Netflix Killer? Here’s What Analysts Say About Apple TV Plus – Fortune

House of Cards
Helped by a low $5 price and a free subscription offer, Apple TV+ could attract as many as 10 million users within its first year, according to an analyst. Dan Rayburn, the analyst for Frost & Sullivan who made the prediction, says the planned video-streaming service, which debuts Nov. 1, is likely to gain traction. Apple has a huge existing customer base that it can market the service to and deep pockets that allow it to take a long-term view in terms of profits. “I think it’s very, very smart of Apple, and they’re going to have a great service at $5 a month with some great content, ” says Rayburn. The low price is a surprising move for Apple, which has traditionally charged the same or more for products than its rivals. But in the case of Apple TV+, Apple plans to charge less than competitors like Netflix, Hulu, HBO Now, and the forthcoming Disney+, which arrives on Nov. 12 for $6.99 monthly on its own or $12.99 monthly as part of a bundle that includes ESPN and Hulu. Furthermore, in trying to attract subscribers, Apple is going on a marketing binge. Everyone is eligible for a one-month free ....


For the time being, Apple can rely on and market other revenue streams, such as the iPhone, which generated $26 billion in revenue during the latest quarter, and its services business, which collected $11.5 billion. “They [Apple] will make up the money in other ways, ” says Rayburn. “Apple owns it all:  They own the ecosystem. Netflix doesn’t have that.” What Netflix does have on Apple is a significant head start in the original content space. Since debuting its first major original series, House of Cards, in 2013, Netflix has poured tens of billions of dollars into the production of original series and films, including Stranger Things, The Crown, GLOW, Grace and Frankie, and this year's highly-acclaimed Roma. Those projects helped cement Netflix as the go-to streaming service for over 151 million subscribers worldwide, despite a bumpy fiscal second quarter for the company that saw a decline of 126, 000 paid U.S. .

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