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Apple Plus – brand versus subscription
- benologist 8y agoPaying Apple monthly for music, news, games “lifetime services” for the next few decades is only good if you want your money added to their massive experiment in tax evasion instead of folded back into your city, state, country, education, healthcare etc.
- tracer4201 8y agoAren’t all large companies exploiting loop holes in the tax system? I hate the new MacBooks, but I generally like Apple products and will continue to buy them.
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- benologist 8y agoApple are really in a scale of their own. They didn’t all hoard over 200 billion whilst waiting on a corrupt deal to repatriate it at a lower tax rate than they were supposed to be incrementally paying all along. And Apple are also just inserting themselves as a middleman for nearly all of these services too. They don’t manage 200b ethically or responsibly so why should we make it 400... https://www.usatoday.com/story/news/world/2017/11/07/paradise-papers-apple-shifted-billions-offshore-avoid-tax/839565001/ https://www.usatoday.com/story/news/world/2017/11/07/paradis...
- Svoka 8y agoFYI, Apple pays taxes on profits it makes in USA. Problem is with foreign income, which by some weird quirk in US law code must be taxed as well in USA. So yes, person in Italy subscribing to Apple Music doesn't build US roads and cities. But you buying Apple's stuff would. I think this is how it should be. Weird that companies based in USA must create shell companies to get on same taxation level as everyone else in the world. EDIT: https://www.apple.com/newsroom/2017/11/the-facts-about-apple-tax-payments/ https://www.apple.com/newsroom/2017/11/the-facts-about-apple...
- AJRF 8y agoI think this was actually a surprisingly weak showcase from Apple. Something in the TV space with a bit of bite at Netflix would have shown confidence in themselves, a new avenue for creativity that consumers are so engrossed with (i.e new Netflix shows and films are in themselves, events. People talk about the newest Netflix show like a new product release). Instead they showed a credit card, that look's nice, but I fail to see how Ben think's that reduces churn (credit cards aren't sticky, incentives are - no one will buy a new phone because they're middle of the road rewards are there) and then a subscription that would have been a footnote in a Google or Samsung keynote. Those subscriptions for news (and even more so for Games) are non-events. They are so boring, so anti-sticky that they made me think this whole thing was actually a failure - and Apple shouldn't have made a song and dance of it and just talked about during the iPhone keynote.
- b_tterc_p 8y agoThe card is probably a good idea. No fee, simplicity, and convenience are good for the consumer. Only selling to Apple product users means a certain band of wealth and thereby lower default rates are implicitly targeted. It’s a good deal for both, especially for consumers who wouldn’t normally spend enough to earn something noteworthy or even positive against the card fee on better cards. News is also a pretty good deal if you like news... but yes, both are really boring. It seems like something interesting to apple investors, but not consumers. The games platform sounds both boring AND unlikely to do well
- kristianc 8y ago> The card is probably a good idea. No fee, simplicity, and convenience are good for the consumer. Only selling to Apple product users means a certain band of wealth and thereby lower default rates are implicitly targeted. The strategy may work in the US where the payments ecosystem is incredibly dated and backwards, but Apple Card is very much a me-too offering in nearly every other developed economy.
- servercobra 8y agoThey have around 100 million iPhone users in the US, so that seems like a very reasonable market to target, even if no one outside the US ever uses it.
- shittyadmin 8y agoGoogle should just kill the YouTube app for iOS and see how long this exclusive bullshit lasts.
- eknkc 8y agoI don't think YouTube can survive that.
- ZeroCool2u 8y agoI expect it would be chaos, not to mention could massively backfire, but would definitely be interesting to watch what would happen if Google coordinated with Netflix to disable both on Apple devices.
- usaphp 8y agoyou do realize they will lose half of their userbase by doing that? Google depends on iphone users a lot, both for their search and youtube, iphone users are more likely to purchase something as well after watching google ads = more money for google
- scarface74 8y agoSo Google is both going to continue paying Apple a reported $12 billion a year to be the default search engine on iOS and lose more than half of its audience in the US and lose most of its more affluent audience?
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- aljones 8y agoYouTube app is nice but so is the web site.
- mrweasel 8y agoThere would be no real benefit to Google in doing that, only downsides. Developing the YouTube app cost very little, in the grand scheme of things, and non of Apples offerings are really a threat to YouTube or even YouTube Music.
- graeme 8y agoRegarding stickiness. Apple introduced the following: * News+ * Apple card * Apple Arcade * And they already have Apple music Am leaving TV out of this list for now. Most people may not want a particular service. But it’s highly likely a good chunk of apple customers will want at least one or two of them. And then that becomes a factor at switching time. For instance, I’ve considered Android in the past. What has always stopped me are two thoughts: ‘What about privacy?” and “what about imessage?” Note that these don’t need to be sticking points for you. I’m saying they’re sticking pointed for many. Now, apple is adding three new service sticking points, to add to their music sticking point. People will think things like “I really like reading Apple News everyday/I like getting the WSJ”. “Those games are so fun for my kids” “Ugh, I’d have to get a new credit card if I switch phones?’ Apple already has a strong ecosystem effect, especially in the US. These will add to it. The apple watch and airpods are another stickiness factor that’s growing rapidly as well. I left off TV: I’m not sure how it adds to stickiness. Apple is making it widely available on third party devices. So you can still get a show you want even with no apple hardware. Will there be some tie in to apple hardware announced when the service launches? Or some kind of bundle price that itself adds stickiness? Unclear, the strategy behind the TV service is still a bit opaque. Personally, I’m excited for Apple Arcade. Don’t know how the games will be yet, but it has potential and will be a nice complement to having a nintendo switch. News in Canada is....ok, though it’s unclear to me how much I’m getting with paid vs the free version and I may not keep it. Depends how much value I get from the wsj.
- treis 8y ago>Regarding stickiness. Apple introduced the following: I don't think any of those things are all that sticky. I think it's more about leveraging their client base to push into what are essentially commodity industries. Like the credit card. Apple's offering is more or less the same as everyone else's. They will still get some % of iPhone users because it's the most convenient option. Even a few % translates into millions of users and 10s-100s of millions of annual profit. Amazon is a few years ahead of Apple in doing the same thing. They have a gigantic second mover advantage in any sort of app or online service. Whatever they make can be the default option and they have a built in 30/15% price advantage from the app store fees. >I left off TV: I’m not sure how it adds to stickiness I think this is the best example to illustrate my point. Video streaming is not really a commodity. It's a balkanized landscape of minor fiefdoms controlling content. There's a handful of big movie studios, a bunch of TV producers, all of the different sports league, and other live events. It's not like music where Apple can produce a Spotify competitor with relatively little effort. Competing with Netflix means producing originals and doing a better job of buying content. It's much much harder.
- philliphaydon 8y agoI’m pretty convinced that Apple card is in some way to dodge tax. But unsure how.
- clay_the_ripper 8y agoIt seems really weird to me that with services their new “thing”, why they won’t allow me to back up my computer to iCloud. Not iCloud Drive, I mean a time machine backup in the cloud that I could restore an entire computer from with migration assistant. Maybe they can’t figure out a way for it to be cost effective? It just seems word to me you can do this with your iphone but not a computer.
- votepaunchy 8y agomacOS apps’ local data is synchronized and can be versioned in iCloud containers. Plus Documents and Desktop are synchronized as legacy dumping grounds for files. Actual app installations are not backed up on either system, though iOS does reinstall on restore. It isn’t necessary to backup the entire drive.
- uptown 8y agoConsidering Apple’s pricing structure for storage I’d advise to use other providers for this. Arq with your storage provider of choice is my backup solution for off-site.
- paultopia 8y agoHmm. Re: "Apple’s evolving brand promise. The old Apple promise was that you don't have to worry if the tech works. The new promise is you don't have to worry if the tech is scamming you. Everything Apple showed was about curation, safety and trust. No tracking, no scammy ads, no loot boxes, no weird credit card charges." The evolving brand promise thing seems right to me as a general principle, but it doesn't seem either new or particularly applicable to these services. Apple has always had a major competitive advantage in being relatively free of scams and attacks---much less malware than windows, zero OEM-installed garbage compared to windows or android, SIP and App Store curation, etc. etc. But I'm not sure how that point applies to the rollout of services that are competing with established and legitimate players. Nobody's going to choose Apple over Netflix or Steam or the like on the theory that Netflix/Steam is "scammy."
- bunnycorn 8y ago> Nobody's going to choose Apple over Netflix or Steam or the like on the theory that Netflix/Steam is "scammy." No. In the same way people won't be choosing Netflix over HBO because HBO is scammy. The whole article doesn't make any sense. When you buy a computer or a phone, you buy just one and that's it, having more than a computer or phone doesn't make much sense as it's worse than having only one. So Apple needs to make a decidedly (for the costumer) better product. While in art/entertainment, there's no "better", people consume the content they want, and can have more than one subscription. You can have Netflix and Apple and HBO and many others, or none at all. The only thing Apple needs is to produce content good enough that people are willing to spend the mensality.
- screye 8y agoI sometimes feel like Government should mandate that subscription expenses be reported and advertised in strictly annual costs. I've meet too many people who feel like paying $100 for a service annually is too much, but $10 a month is acceptable. These subscription fees add up, often without users ever realizing.
- Despegar 8y agoWhile I agree that's the new brand message, I don't think that necessarily means that Apple's TV content is only going to be family oriented. Some of the clips they showed in the video don't look like it would be appropriate for kids. They were negotiating to get a violent TV show according to CNBC [1]. And Apple's iTunes store has already sold movies and TV shows that were for mature audiences, so I doubt they're going to place any restrictions on what kind of content they're going to buy. [1] https://www.cnbc.com/2018/12/06/apple-pursuing-violent-israeli-show-nevelot-richard-gere-to-star.html https://www.cnbc.com/2018/12/06/apple-pursuing-violent-israe...
- tinus_hn 8y agoI was surprised to even spot someone smoking a cigarette!
- madrox 8y agoI led the build of an SVOD service at a large media company that was also mentioned in this article. Negotiating with Apple at the time to get our service approved, and then negotiating with them further on integration with the TV app, it was clear their ambition was be a media company by the concessions they wanted. This was years ago, mind you. Which leads me to the other part of Apple's brand: they will make your life hell if you play in a space they deem important to their survival. Any developer on the app store knows this. We're entering a world where it will be very, very difficult to survive as a third party in an ecosystem, and the argument will be "our brand." For any success you have, 30% of your gross revenue is going to help finance a potential future competitor. We have to double down on mobile web in the next decade if we want any semblance of competition in media.
- Despegar 8y agoIf Netflix doesn't like being dependent on Apple, they should have built the rails. They chose not to, and that's probably the correct move, but I don't see why they'd complain about the 30%. They could have not spun-out Roku and not have to pay for distribution to anyone! They obviously knew that being everywhere would maximize profits in the long run. But it goes hand-in-hand that now they've eliminated the capital expenses of developing a platform, they'd be paying others for distribution. I mean that's what net neutrality was always about really, not being responsible for the rails but also regulating them to maximize the advantage to themselves (a standard commoditize your complements play). They dropped their net neutrality advocacy after they got big enough and wanted to partner with cable companies and wireless carriers for distribution, which they gladly pay for.
- _bxg1 8y agoThis is why we have antitrust law. Google has been fined for pushing their own services on Android, because they have multiple times the market share of Apple. I'm sure if Apple went far enough they would get dealt with too.
- scarface74 8y agoThis is a very one sided story. We have an existence proof of there being literally dozens of video on demand apps on iOS and tvOS - many of which don’t allow people to subscribe within the app. There are also a half dozen streaming music services.
- _bxg1 8y ago> More interesting: Apple’s evolving brand promise. The old Apple promise was that you don't have to worry if the tech works. The new promise is you don't have to worry if the tech is scamming you. Everything Apple showed was about curation, safety and trust. No tracking, no scammy ads, no loot boxes, no weird credit card charges. And Oprah. This is an extremely good point. I'm a technical person, I love open technologies, but I've invested in Apple devices because right now we have no choice but to put trust in one major tech company or another, and Apple is the only one I have an iota of trust in not to screw me over. They're smartly capitalizing on a culture shift of tech-skepticism, and I'm not ashamed to say that that sales pitch works on me. Their competitors would be wise to take notice.
- m463 8y agoUnfortunately, they're playing both sides of the game. If Apple would let you use their products anonymously, that would be a clear indicator they were on the side of privacy. a couple pointed questions: - do you know what apps on your iphone are doing? can you find out? - do you know who they contact? - do you know what technologies they are using? deep linking? ibeacons? - can you firewall your apps?
- _bxg1 8y agoNobody can totally prevent third-party apps from recording your interactions with them, though Apple has made some effort (https://techcrunch.com/2019/02/07/apple-glassbox-apps/ https://techcrunch.com/2019/02/07/apple-glassbox-apps/). Apple also strongly enforces that third-party apps have to gracefully degrade when individual permissions are denied. So that a delivery app, for example, can't strong-arm you into enabling location services by refusing to work otherwise. All of Apple's first-party services give detailed breakdowns of what information Apple receives before it does so. Other than privately-stored iCloud data, they send virtually zero non-anonymized data to Apple. And as much as possible - especially with things like Maps - they keep data local to your device. So no, I don't always know who third-party apps are contacting, because nobody can. But I do know (and have control over) every interaction they have with the rest of my device and data. For first-party apps, I do know everyone they contact and with what information, and it's kept to a reasonable minimum.