Leaked Pricing for Apple TV+ is Certainly a Trial Balloon

2 minute read
| Editorial

The leaked pricing for Apple TV+ is certainly intentional and designed to gauge the reaction in the community.

The leaked pricing, reported yesterday at Bloomberg, was sourced from “people who asked not to be identified because the plans aren’t public.”

Apple hasn’t announced pricing for Apple TV+, but is weighing $9.99 a month, the people said, which would match Apple Music and Apple News+. Netflix and Amazon Prime charge as little as $8.99, while Disney+ plans to seek $6.99 when its service debuts in November.

And that right there is the brutal competitive situation. Disney+, for example, exploded a strategic bombshell under Apple (and others) in June when it announced its pricing and content.

Calling it an “exciting and challenging time” for Disney, [Disney CEO Bob] Iger said the service will be built around five Disney properties: Disney, Pixar, Marvel, LucasFilm and assets it acquired from Twenty-First Century Fox, like National Geographic.

Recently, Disney+ also announced an extremely competitive bundle: Disney+, ESPN+ and commercial-supported Hulu for $12.99 a month.

This Disney portfolio is amazing and greatly outclasses Apple’s expected offerings of just five shows at launch. Bloomberg reported:

Apple’s initial slate of shows will include “The Morning Show,” Steven Spielberg’s “Amazing Stories,” “See” with Jason Momoa, “Truth Be Told” with Octavia Spencer, and a documentary series about extravagant houses called “Home.”

For another example, compare those five to thousands of TV shows, movies, and original content from Netflix, and it’s clear that Apple is facing a difficult market. That this leak completely ignores the ferocious market reality is less blatant hubris than an attempt to wind up observers who will, no doubt, suggest smarter strategies.

Apple’s Dilemma

Apple is in a bind, and the company knows it. Cash-strapped consumers, who feel the weight of many, many subscription services crashing down on them already (and more coming), are going to make choices based cost, volume of content, family and personal favorites.

The challenge for Apple now is to wriggle into this market with enough success to gain a permanent foothold and generate good services revenue. That might mean very attractive bundling, or a more market-realistic price—somehow without devaluing its quality content.

Disney+ has made this incredibly hard for Apple to do. Such a ridiculous trial balloon by Apple suggests that the company is struggling with the pricing strategy and needs fresh thinking fast.

For starters, an immediate survey of a suitable random sample of Apple customers, soliciting their intent at $10/month for five shows at launch, should be instructive.

Can Apple yet surprise and delight us?

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Paul Goodwin
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Paul Goodwin

A free trial period would allow potential subscribers decide what a fair price is. There’s some mind numbingly poor services out there that should be paying us to use them. If the content matches what the potential subscriber wants, $9.99 would be fine if the good content is there and there’s a minimum of commercials and the user can skip or fast forward through whatever he or she wants to.

Realist20
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Realist20

I will continue to do what I have been doing which is join a service for a free trial and binge watch what I want then quit before I have been charged or just join for a month. its too expensive to justify this folly. My cable and current setup with HBO is $135 per month add Netflix and amazon for another $22 per month. When someone comes up an à la carte method where channels cost $1 each per month then I will be interested.

MacFrogger
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MacFrogger

Spot on analysis John…

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shameermulji

I completely agree with the conclusion of this article. I see ATV+ being successful if Apple prices it at $4.99 as a stand-alone offering or $9.99 when bundled with your choice of another Apple service (ie: News+ or Music or Arcade).

geoduck
Member
geoduck

That is the best idea I’ve heard so far. $10/mo, $13/mo here in Canada, for ATV plus Arcade. I’d go for that.