While many thought Apple would buy Netflix, it's creating its own streaming content instead. So now that the curtain has been pulled back on Apple TV Plus (styled as Apple TV+) and Apple Channels, it's time to think about how Apple will compete with Netflix.
After Apple's March 25 "Show Time" event, where the company teased its new service, I can see reasons for Netflix CEO Reed Hastings to be both calm and frightened about what Apple has planned.
Netflix should be scared because Apple is playing on another level
First off, don't mistake apples for oranges. Carolina Milanesi, a consumer tech analyst at Creative Strategies told me that anyone comparing Netflix and Apple are missing out: "Should Netflix be afraid?" she said, echoing my question. "I think anybody should be afraid of any kind of competition, but this isn't a case of like against like."
And therein lies what's scary for Netflix. "It's a different proposition," Milanesi told me. "Apple TV Channels is an aggregating app," so by combining that with Apple TV Plus, "cord cutters now have a one-stop place for individual channels (which Netflix doesn't have)." The danger, she said is that if Apple gets a wide enough user base for its service, Netflix would be "left out of this aggregator."
Also, Apple might get in the way of Netflix's larger ambitions, as Avi Greengart, lead analyst at Techsponential, noted "Apple is unburdened by legacy contracts, so it is able to launch in 100 countries at the outset."
Yes, even though that stat about Apple TV+ launching worldwide may not effect you, it may affect Netflix. As Greengart puts it "Global growth is extremely important to Netflix, and even if Apple TV+ does not have a lot of compelling content out of the gate, if it prices its bundles reasonably, it will be a credible competitor."
Netflix is safe because Apple barely showed its content
Right now, we don't know too much about Apple TV+'s shows, other than who's making them. "We don’t know how much it costs or whether the shows are any good," Greengart said.
Outside of brief descriptions provided by the stars and celebs paraded on stage — hi Oprah! — a short reel containing brief glimpses of these shows gave us all we could see, and it had nothing that made me scream "I need to stream that now!"
Yes, it was neat to hear Jennifer Aniston, Reese Witherspoon and Michael Scot- I mean Steve Carrell talk about their upcoming series The Morning Show, which focuses on a workplace dynamics at a morning news show, highlighting how men and women relate at work. But without any sample of the program itself to show me any glimpse of quality, my brain just starts to remember very bad shows with similar premises, such as The Newsroom and Studio 60 On The Sunset Strip. Maybe it's going to be a great show, like the short-lived Sports Night, but I'm gonna need to hear some banter before I give some trust.
Annette Zimmermann, vice president and analyst at Gartner Deutschland, emphasized that this isn't a zero sum game: "If the content and the price is competitive and Apple lets the users mix and match its different services, then this will work well for them," she said. "Because for many users, including the millions of Netflix users, TV+ could be an additional service — not either or."
After all, what's one more $9.99 service anyway, when you've got an Apple Card to charge the service with?
Be sure to check out our Apple Show Time hub page for a look at everything Apple announced at its March 25 event.