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While they're investing in marketing / engineering and they'll see user base grows, especially if products is free or almost free. But at some point of time que
by batter 5y ago
While they're investing in marketing / engineering and they'll see user base grows, especially if products is free or almost free. But at some point of time question will come to revenue per user. And that will be completely different problem.
- Jtsummers 5y agoIn this specific case, Fitness+ is relatively cheap to produce (all the content is theirs except for the music, but they already have a good relationship with music producers) and cheap to distribute. They make 1-3 new videos per instructor a week. I doubt it's costing them much per user to distribute the content. However, the Apple Watch is a nice profitable device for them and Fitness+ requires Apple Watch. So for anyone who already has the highest tier subscription (probably a decent chunk of multi-iDevice families out there) they will find themselves having Fitness+ but being unable to use it, which creates one extra motivator to buy an Apple Watch. That's where they end up making money anyways, 75% or so of their revenue is from device sales (computers, phones, tablets, watches, etc.). The services help to keep people within that hardware ecosystem which gets people onto the upgrade cycle or to consider a second or third Apple device instead of just having one.