Apple’s iPhones aren’t selling like they used to.
The gravy train is waning, and Apple knows it, so to make up for the lost income, Apple wants to get recurring payments from you monthly. And more than it picks up now from, iCloud, Apple Music and Apple Care.
Yes, it’s Showtime.
Apple has once again summoned the media to its Cupertino, California headquarters. Monday’s “Showtime” event is expected to be a star-studded sneak peak of a new $9.99 monthly entertainment subscription service, offering series and movies from the likes of Steven Spielberg, Oprah Winfrey and Brie Larson. Additionally, a new News subscription service, offering the best of publications like the Wall Street Journal and People, is expected as well, for $9.99 monthly.
The question many of us have now–is there a bulk deal? How much does Apple think we’re willing to pay for?
The place to find the entertainment service is expected to be on the Apple TV app. That’s available for the set-top box and on iOS devices like the iPhone and iPad. Reporters are eager to hear how Apple plans on expanding its base to TVs and other set-top boxes like Roku and Amazon Fire TV Stick.
But most of the attention will be focused on the big Hollywood players Apple is expected to fly out to its campus.. Which stars will be there? That’s the guessing game many are playing this weekend.
It’s important to remember why Apple is doing this, even though it’s more than fashionably late to the party. Netflix started in 1997 and now dominates streaming, followed by Amazon Prime Video, Hulu, CBS All Access and others. Disney and Warner Media are launching new services in the coming months. Consumers, as was pointed out this week by Deloitte, can only handle so many subscriptions.
Will Apple consumers really stomach $30 monthly for entertainment, news and the pre-existing Apple Music service?
“Getting the consumer to do a monthly $30 subscription is just too difficult,” says Tim Bajarin, an analyst with Creative Strategies. “Apple has to come up with something else.”
As it stands now, Apple sells more iCloud storage plans, Apple Music subscriptions and iTunes movie rentals than it does iPads, Mac computers, Apple Watches or accessories like the AirPods.
Services, the division that incorporates the monthly plans, generated over $10 billion in the most recent quarter. It has a long ways to go to catch up to the iPhone, which in the quarter brought in just under $52 billion.
Seven years after Spotify, Apple Music launched in 2014 as a mostly copycat service that ended up garnering over 50 million subscriptions by targeting its 1.4 billion base of iPhone users.
Can Apple get even bigger numbers with entertainment, and get an iPhone size hit?
Andrew Wallenstein, the co-editor of show business bible Variety says that’s unlikely.
“They’re not going to take on Netflix,” he says. “The market is too cluttered, and Apple is too late. But they do have the ability to carve out some significant market share.”
Apple doesn’t have to beat Netflix, he says, but “just increase engagement with its devices.”
Meanwhile, if you missed it, here’s what Apple announced this week, hardware wise:
—New iMacs. Apple also refreshed the iMac stand-alone computer lineup, with new models at 21.5 inches and 27 inches, starting at $1,299 and $1,799.
—Second generation AirPods. The tiny bluetooth earbud touts longer battery time and the ability to work with the Siri personal assistant but no new tools to keep them in your ear.
In other tech news this week
Facebook scandal of the week — the KrebsOnSecurity security news site found that hundreds of millions of Facebook users who had their account passwords stored in plain text could be searched by more than 20,000 Facebook employees – in some cases dating to 2012. Facebook later admitted the flaw, but said it had been fixed.
Google debuted a new streaming gaming service. Google’s Stadia looks to compete with Microsoft, Sony and Nintendo with a new service set to debut in the fall. Mike Snider points out Google “promises new ways to connect with games including a Play button on YouTube videos that will launch you from the video into that game.”
Robocalls — Help could be on the way! AT&T and Comcast said that they can authenticate calls made between the two different phone providers’ networks, a potential industry first and the latest in the long-running battle against spam calls.
This week’s Talking Tech podcasts
—Camera or smartphone? Liz H. Kelly says to only use cameras for important work; I speak up for the smartphone in this debate with the author of the new book, 8-Second PR.
—Hey Google, let’s ask Alexa some questions. Turning the tables on the assistants.
Follow USA TODAY’s Jefferson Graham (@jeffersongraham) on Twitter
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