Many YouTubers like Jason from Painfully Honest Tech think that Apple TV
Plus is going to be dead on arrival. But what if I told you that Apple
TV Plus and Disney Plus are not competitors in the slightest but they are
in fact synergistic and complementary to,one,another.,I,am,Mike,and this
is Tech 24/7 TV. If you're new the channel let me know what you think about
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Even though Apple and Disney will offer streaming services in the fall,
I'm really hesitant to categorize the two companies as competitors in
the traditional sense of the word.
Now you might be thinking yourself Mike what are you talking about? They're
offering streaming services while the content might be different. How can
they not be competitors."
I think that is a natural conclusion to come to because the companies offer
products that are similar in nature, so let me elaborate. First,
Disney Plus is not the singular source of revenue nor will be the
most important source of revenue for the company. In fact we see that media
network segments for Disney is a business that's actually accounting for
less and less of the company's total operating income. Second,
we have in the broader Walt Disney context each of the entertainment
properties exists to better serve Disney theatrical films creating a kind
of a virtuous cycle.
In today's terms what that means for you is that your kids are watching Frozen.
They're going to watch it 10 million more times.
They're going to find that song that they love they're gonna want to hear
all the time so you're in a perching that through iTunes or Apple from
there they're going to want to have make sure they have the Elsa bedsheets
before capping off the experience with a criminal cram of a trip to Disneyland.
Thus completing the virtuous cycle for Disney until Avengers Endgame comes
out next weekend and then the cycle repeats for everybody right.
Bringing it back to Disney Plus; the entire reason Disney Plus exists is
to serve as a constant reminder to you and your pocketbook what your favorite universe is,
who your favorite character is and when the next movie's coming out.
We can apply the same logic towards Apple and their streaming services.
Apple TV Plus is not the company's only source of revenue because I mean
Apple's hardware company.
It is a means to an end to increase the value of the entire ecosystem as
a whole. Well you probably ask yourself Mike OK I'm kind of get with you
there so far but who's the competition then?
Well if every service that overlaps with one of Apple's core offerings
is a competitor that listens and exhaustive very quickly.
For example, if we think of competition in a very granular manner
CBS NBC and even ABC are Apple'scompetition in the streaming video space because
they all are trying to pry consumers away from watching one of their services.
By large these companies have different business models than Apple which
are anchored in advertising and content delivery going to be their mechanism.
But Apple is not a content provider. If we recalibrate the way that we
think about Apple from say a hardware company to a company that focused
on delivering great customer experiences that specialize in removing friction
to such a high degree or when you think of friction it could be money from
your wallet.
It results in those customers consuming more products and services from
the same company. It's not unreasonable to conclude that since Apple focuses
on delivering great customer experiences in your living room using differentiate
hardware running customize software. Apple's competition shifts away from
the apps that run on a TV or on the phone to anything that takes you away
from using the Apple television This,makes,the,likes,of,Comcast,in charge
of the competition. That is because watching television is a zero sum game
meaning that you can not use your Apple television hardware. If you're
a television my is said to the cable input which is why Apple is trying
to increase the value of the ecosystem so you never have to change the input.
All of this underscores my first point why Apple and Disney are strategic
partners in fact who need one another to accomplish the business goals.
For Disney, it's very simple they want to address as many customers as
possible get them into the cycle using one of the most popular distribution
mechanism for its customers which is going to be Apple TV and tvOS.
For Apple, they want to make sure that there are no glaring reasons why
a customer would need a change from an input on their Apple TV because
every reason the customer has what we can on platform usage time and by
extension it will erode engagement.
Apple wants to increase the value of iOS and Mac ecosystem and it will
accomplish this by digitizing trust in,the,same,manner,that,eBay,or Airbnb.
Because the outcome of digitizing trust is that consumers find more value
in their purchase knowing that the services hand curated by Apple and the
service are underpinned on privacy, security and they will find family
friendly consent there. This makes consumers less likely to leave the iOS
and Mac ecosystem by removing friction in areas of games television news.
Apple purposely increases the friction on deciding when you want to leave
the Iowa ecosystem.
Now I understand that there are some of you who still think that Apple
TV Plus is bound to fail due to lack of content which I would ask you how
reasonable is that conclusion given that we know that Apple's been working
on some version of Apple television since 2011 which coincidentally happens
to be the same year that Bob Iger was named to the board of directors at Apple.
And we know Disney has been working on some version of Disney Plus since
about 2015. Now I don't know about you but personally speaking I don't
find it very realistic to think that Apple the world's largest technology
company cannot compete with Disney with three years possibly even eight
years with a notice
While pricing is important, value is going to be paramount. Disney is offering
great value for consumers. Given the low monthly cost in the large back
catalogue of content which is great because if you're like me and you grew
up watching The Empire Strikes Back or even Return of the Jedi.
In addition to being a secret fan of the Marvel Cinematic Universe because
the DC Universe is just so utterly disappointing at this point.
Speaking of disappointing I think that is a great word that some people
would use it to characterize how they felt after watching Apple's March event.
But let's put that March event into a little bit different context knowing
what we know now strategically speaking not announcing the price best positions
Apple because it hasn't committed to any specific content pricing for the
upcoming service.
This means that advocate price Apple TV Plus very aggressively as a means
to an end to increased customer value when they're purchasing a new iPhone
and to decrease defection to Android that and Apple is well-positioned
to announce how pricing can be structured alongside new iPhones and Apple
TV hardware in the fall. All of that said I think the current narrative
that Apple TV Plus is dead on arrival because it doesn't have the same
content as Disney Plus is missing the forest for the trees in the same
way that Apple cannot become a global news service overnight. It cannot
magically create a century's worth of back catalog content.
But what Apple can do is leverage his engineering prowess to create amazing
experiences both in your living room and on your phone so that you almost
never need to use a device that isn't capable of running an apple service.
What's going on everyone. Thanks very much for watching my video on Apple
TV Plus and Disney Plus what do you know how hard it is to say both of
those kind of consecutively like 55 times,it's,a,pain,I,had,to,do this
like 15 times anyways I'll put a link to a video here with YouTube things
you should watch another link to a playlist here and then a random video
next to that.
Let me know what you think about Apple TV Plus and Disney Plus in the comments below.
Make sure you subscribe because I have a lot of content coming out and
I will talk to you in the next one