Apple TV+: Welcome to the age of the ‘unbundle’
A la carte programming will add up for viewers
Apple’s new streaming service is finally no longer simply rumored or expected. The name: Apple TV+.
While some details – including how much the new service will cost – were scarce, the event was overflowing with famous faces.
Sure, Oprah Winfrey, Reese Witherspoon, Jason Momoa, Steven Spielberg and J.J. Abrams were among the many headliners brought on stage by the iPhone-maker, but honestly, the trend toward streaming and cord cutting has been more about dead presidents on dollars and how much you save than celebrities on stage and how many you see. Now consumers are looking at yet another new subscription service when it launches this fall, something that will likely add even more costs to consumers’ media budgets.
To paraphrase Gwyneth Paltrow, one of the stars of Apple’s first produced shows, the ill-fated “Planet of the Apps,” welcome to the new era of conscious “unbundling.”
Consumers have long hoped for a time when they could pick and choose which channels they wanted to pay for from a cable plan.
In 2016, TV tracker Nielsen revealed that the average cable subscriber had more than 200 channels in their bundle, yet only watched roughly 20.
While that era hasn’t yet materialized, with the rise of streaming services like Netflix, HBO Now, Hulu, Amazon and now Apple TV+, it may be coming close. And it won’t be cheap.
Want to watch the new season of “Stranger Things”? That starts at $8.99 per month, or $12.99 monthly if you want HD. “The Handmaid’s Tale” on Hulu? That starts at $5.99 per month. How about “Game of Thrones?” Please send your $14.99 per month to AT&T for HBO Now.
Total so far? You’re looking at roughly $33.97 for these three services in HD, and this isn’t including live sports, live television or the upcoming services from Disney and AT&T that are due to begin arriving later this year.
Throw in a live streaming option such as Sling TV, which normally starts at $25 per month, and you reach a total of nearly $60 per month that rivals the cost of a traditional cable package.
And that price doesn’t include Apple’s new TV+ service, which the company did not reveal a price for at Monday’s event.
Without showing off any trailers of the new shows it will be offering, the company is setting a high bar for itself to build excitement that might lure potential subscribers.
“People generally don’t sign up for subscription TV services unless there’s something that they explicitly want to watch,” says Avi Greengart, lead analyst at research and consulting firm Tech-sponential.
“Netflix, Amazon and even HBO all have compelling shows available now along with a rich library. Apple will have to prove itself.”
Fighting streaming fatigue
As the options pile up, companies are getting more inventive with how they show their respective value to consumers.
Some have followed Amazon’s path, which bundles in a host of services to make the $119 yearly subscription more than just Prime Video for watching “The Marvelous Mrs. Maisel.” The company throws in a host of other perks, including Prime Music, free two-day shipping and early shopping deals.
Hulu and Spotify announced this month that they would be partnering up, with a $9.99 per month subscription to Spotify also netting you Hulu’s $5.99 plan at no additional cost.
Patrick Moorhead, founder and principal analyst of Moor Insights and Strategy, expects more companies to partner in the future, and also expects some consumers to bounce around between the services to get the best deals.
“Different kinds of consumers exhibit different behavior,” Moorhead says. “There are savers who will switch many times to save money, convenience buyers who switch to save time and those who need a huge motivation to switch anything. Most users fall into the latter category.”
And it is not just streaming companies that are teaming with one another. They have also bundled their services with broadband and wireless providers.
AT&T offers HBO, Showtime, Starz and Cinemax as options for those who pay for its priciest unlimited plan, T-Mobile offers free Netflix with some of its unlimited plans while Sprint offers its unlimited users free Hulu.