Apple TV+ to launch first discounted video bundle
Access to both Showtime and CBS channels
Apple Inc. plans to bundle access to CBS All Access and Showtime content at a discounted price for subscribers to its TV+ video service, according to people familiar with the plans.
This is Apple’s first discounted bundle offering for video content with the TV+ service. Currently, users must subscribe to different content providers in the TV app on an à la carte basis.
Starting as early as Monday, Apple TV+ subscribers will be able to access both the CBS and Showtime channels in Apple’s TV app for US$ 9.99 per month combined. CBS All Access and Showtime normally cost US$ 9.99 and US$ 10.99 per month respectively, so the deal would be a significant savings.
Viacomcbs Inc., which owns both content providers, has offered discounted CBS All Access and Showtime bundles in the past on their own website. ViacomCBS shares rose on the news.
An Apple spokesman declined to comment. The company’s stock closed 1.8 per cent higher to US$ 460.04, just shy of a US$ 2- trillion valuation Thursday.
The move is designed to spur interest in the Cupertino, Calif.- based company’s latest video services. The discount bundle rate could boost usage of Apple TV Channels, a service that lets customers subscribe to third- party content via the company’s devices. The requirement for a TV+ subscription also makes the US$ 4.99 per month service more valuable and could potentially attract more subscribers.
The initiative is a major bid by Apple to achieve the same loyalty that Amazon. com Inc. has won with its Prime program, which combines free shipping with video streaming and many other services for an annual or monthly fee. This bundle is the bedrock of Amazon’s success and has been mimicked by other companies before with mixed results.
Apple has no e-commerce delivery and warehouse network like Amazon’s, however it has hundreds of millions of ardent hardware customers who have already embraced some of its digital subscriptions. The iphone and ipad will suggest different packages to users based on which Apple apps and services they already use. This feature will come later this year as part of IOS 14, the next software update for Apple’s devices.
While Apple TV+ has had some well- received content, including The Morning Show and Tom Hanks’s Greyhound, the service still lags behind Netflix Inc. and Amazon Prime Video in terms of content and subscribers. Without a large catalogue of older movies and TV shows, Apple is relying on the Channels service to make up for a still-limited array of original content.
Later this year, the company plans to launch a push into services bundles for all of its major offerings with an offering dubbed “Apple One,” Bloomberg reported on Thursday.
The company is also developing a new subscription for virtual fitness classes that can be used via an app for the iphone, ipad and Apple TV, the people said. That service will be offered in a higher- end bundle with the rest of Apple’s services. Codenamed “Seymour,” the workout package would rival virtual classes offered by companies including Peloton Interactive Inc. and Nike Inc., according to the people.
This approach is likely to be applauded by Wall Street, which craves businesses that generate reliable revenue streams. However, there’s also a risk of confusing consumers with multiple subscription choices. This hampered the launch of the HBO Max streaming service, which was introduced this year alongside existing offerings HBO Go and HBO Now.
The initiative is being spearheaded by Peter Stern, a top lieutenant to Eddy Cue, Apple’s longtime services chief. Bloomberg News reported last year that Apple was targeting a bundles launch in 2020.
At first, Apple doesn’t plan to integrate the bundles with services such as AppleCare support or monthly payment plans for hardware like the iphone or Mac. Earlier this year, as part of the Apple Card, Apple started offering monthly payments with no interest for several of its devices.
In addition to the services bundles, Apple is planning new software and hardware bundles, including giving buyers of the Apple TV settop box a free year of Apple Arcade. That would follow a free year of TV+ offered to those purchasing new Apple devices.
Apple tested the waters with a subscription bundle last year, offering students free access to TV+ with a subscription to Apple Music, though it has never confirmed plans for a wide-ranging bundle for all of its major paid services.
Apple’s services segment is one of the company’s fastest growth areas and has become a Us$50-billion-a-year business. While services like those for advertising and Applecare were down in recent quarters due to the impact of COVID-19, digital offerings like the App Store, icloud and video products set records.