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Apple TV Plus is trying to be HBO, not Netflix

During an outbreak in March, Apple announced its plans for TV Plus, the independent streaming service that would stand alongside the growing number of offers from Netflix, HBO, Disney and others. During the company's iPhone event on Tuesday, it gave us a more complete picture of the service, which will be launched on November 1. It costs $ 4.99 a month – less than half a standard Netflix subscription – and is free (for a year) with most Apple device purchases. Apple knows it must have a low price and rely on its hardware strength to attract subscribers and compete with other companies.

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But despite what you may have heard, Apple's new service is not exactly a Netflix competitor. In fact, it may look more like HBO. Apple TV Plus comes within a few months of similar launches from Disney, WarnerMedia and NBCUniversal, creating much more competition for the customer's dollar. For years, Netflix and Amazon Prime have been competing primarily to prove that streaming can be a viable alternative to cable. But those days are over and almost every major content company is now participating.

But although there will be many competitors, they do not all play the same game. Services such as Netflix, Hulu and WarnerMedia want to offer a leaner version of a traditional cable package. They want subscribers to feel that they can get everything they need in one place. That is why they are at the top of subscription packages, with a rumor of $ 12 to $ 16 a month. But Apple is not in that race. TV Plus is most like Disney and tries to make a supercharged version of a traditional cable channel. (HBO Go, which is built on top of a literal cable channel, is another clear example.)

These services have fewer content offers and are priced considerably lower. (Disney + costs $ 7 per month; Apple TV Plus costs $ 5 per month.) Apple's TV Plus is only launched with nine originals, but they are specific to the way Apple TV Plus hopes to define. When WarnerMedia, Netflix and Hulu try to replicate an entire cable bundle – many repetitions, always something to watch – Apple TV Plus tries to replicate what made HBO special: fewer shows but a clear style that you can't get anywhere else.

You see that strategy in Apple's choice of content, starting with The morning show and See. Both shows have reported budgets of $ 15 million per episode and are anchored by Oscar-winning actors and Emmy-winning makers. Every show is overflowing with prestige, with the aim of winning prizes or catching so much buzz that consumers feel left out if they don't tune.

"The more ambitious this project was, the more I felt that Apple was the right place for it, because they also made a shot," actress Reese Witherspoon told Weekly entertainment about The morning show. "They put themselves there to get into the content world."

If Apple TV Plus tries to respond to what made HBO special, it is best to consider Apple as HBO from the late & # 39; 90 / early & & # 39; 00 years. Apple TV Plus wants it Morning Show, See, For All Mankind, and Dickinson series to result in the same type of critical acclaim that Sex and the City, The Sopranosand The wire did. It doesn't want to be that explicit – Apple managers have reportedly told creators that they want to emphasize more heartwarming and healthy content – but it will have the same unique quality as those shows that have been established for HBO. But unlike HBO in that period, Apple doesn't have much practice in being a television channel. And unlike Disney + or HBO Max, it does not have a library of older content to keep subscribers hooked.

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Judging by this week's announcements, Apple plans to use free trial versions to fill the gap, similar to the way Amazon bundles Prime into Prime Video for private subscribers. 85 million people in the US use iPhones, and if even a fraction of that consumer base stays with Apple TV Plus, then this is a headache. Disney + strives for around 10 million subscribers by the end of 2020, which is a significant goal after about a year. Four years in HBO Now, AT&T managers say that 70 million subscribers are their goal for HBO Max. Apple has too $ 210 billion in loose cash of its hardware activities, meaning that it can withstand losses longer than almost all competitors.

Yet it is difficult to say how successful that strategy will be. Apple is not a HBO, nor Netflix, Disney, CBS, NBC or Amazon. They have proven themselves as networks and studios that can create content that people will pay to watch constantly. Apple's first year will be a time to prove to people that it can be more than a hardware company that also includes creative industries such as music and A. For years, Apple has slowly transformed itself into a service company, large companies such as Apple Music and Apple Pay that sits alongside its hardware base. Apple TV Plus is perhaps the most ambitious service play that Apple has tried, by entering a notoriously fickle company at a time of fierce competition. If it succeeds, it opens up a whole new side of the business – but it certainly won't be easy.