Suppose there is anything clear from Apple’s event on Monday. In that case, the maker of premium tech products is trying to sell people on its vision for the future of services—a seemingly effortless lifestyle filled with always-accessible media, exclusive video, and cashback incentives from a literal titanium credit card.
If there’s anything that’s not clear from the Apple event, it’s pretty much everything else. Apple’s pitch for the new era of subscription services was scant on key details, including the pricing and ship dates of some of its latest products. Company executives spoke confidently about services that hadn’t been launching for months; actors and directors pitched shows that had been greenlit and shot, but little footage was shown. That long lead time was another anomaly for an Apple event: Most Apple events occur just days or weeks before a product becomes available to the public, but not in this case.
The new “bundle” of subscription services also raises questions about whether more iOS-only products are good for consumers, who in recent years have moved away from expensive, often restrictive media and wireless service packages in favor of à la carte, monthly, or non-contractual services. Apple was careful to highlight how it’s giving consumers a choice—HBO! Showtime! 300-plus magazines! Two Oprah-endorsed documentaries—and touted privacy as a feature of its offerings. The company’s push in services is designed to lock more customers into Apple’s life.
THE WIRED GUIDE TO THE PHONE
Apple’s new subscription product for premium news, Apple News+, is the one thing CEO Tim Cook spoke about today and launched immediately. It exists as a News+ tab within Apple’s current News app and will serve up a variety of magazine, newspaper, and digital-first news content. (Including WIRED; our April 2019 issue appeared in its News+ form during the event.) News+ will cost $10 a month. However, no one using a non-Apple device will have access to this service, unlike how it was with Texture, where anyone with the app could access all these mags.
Apple’s pricing for other new offerings and exact launch dates are still unknown. Apple Arcade, a new ad-free game subscription service for iOS, Mac, and Apple TV, will launch in the fall for an unknown price. Apple TV+, another ad-free subscription pitch, is also due in the fall, but again, for an unknown price. With all of her on-stage magnetism and enthusiasm for Apple devices, even Oprah Winfrey could have willed the information out of Tim Cook.
We know that Apple’s new credit card, the one physical, tangible product shown off, will become available sometime this summer. And we know it will be jointly issued by Apple and Goldman Sachs, with MasterCard handling the payment processing. Because Apple can integrate hardware with software so tightly, the card comes with sweeteners: Apple offers 1 to 3 percent cashback rewards and few penalties on missed payments. And, since Apple emphasizes privacy, it says it won’t know what you’re buying and insisted that the controversial investment bank Goldman Sachs won’t sell your data to third parties for marketing purposes.
While we know some of the who-what-when of Apple Card, the remaining question is, why get into the credit game? Apple said it’s so customers can lead a “healthier financial life,” with spending tracking built right into the app, a so-noble and seemingly magnanimous statement. However, non-Apple customers need not apply for access to financial fitness because these incentives only work if they already have an iPhone. Customer support is done via iMessage. Two percent cashback is offered if you use your Apple Card with Apple Pay, which requires NFC on an iPhone. It’s designed to keep Apple Card users in the Apple ecosystem.
With Apple pitching so many subscriptions, it’s not a wild theory that Apple is trying its hand at an Amazon Prime-like experience or a kind of bundle for the modern-day tech consumer: Pay our monthly fee and reap the rewards across our multiple services. However, analysts say that what Apple announced isn’t a media “bundle” in the traditional sense of cable TV. And that may be a good thing.
Telecom and cable companies have had “very rigid contracts, and you were usually stuck for two years. Users want to choose the ‘best of breed’ for their different services, but there’s been no flexibility,” says Annette Zimmermann, vice president at the research firm Gartner. “With [subscriptions though] Apple, Netflix, and Amazon, you can cancel every month.” That makes it easy for people to churn, but that’s a positive thing for customers, too: It means the tech companies have to keep adding value regularly.
Jim Nail, the principal analyst at Forrester Research, concurs with Zimmermann. It’s not a “bundle” that Apple is offering, he says—at least, not yet—but more and more disparate subscription services through existing platforms. The more interesting part of yesterday’s event, Nail says, is Apple’s implicit message. “They’re saying, ‘We’re on your side, we’re going to protect you.’ But the tradeoff is, ‘You have to live in our ecosystem and pay the prices we charge.'” In the age of Facebook and Google, Nail says, that’s a proposition that consumers may find compelling.
But even if Apple isn’t creating something with the perceived “bad value” of a cable bundle, that doesn’t mean its choose-what-you-eat-for-$10-a-month assemblage is a slam dunk for all media consumers. Again, these services are largely limited to Apple devices, although its revamped Apple TV app will eventually work on Roku and Amazon devices. And not all media are created equal; applying one medium’s established conventions to another doesn’t always work. For example, it remains to be seen what people consider a fair price for touch-optimized games, let alone an all-you-can-play buffet.
That calculus gets even more convoluted on the TV App, where nearly every premium service mentioned—HBO, Showtime, Epix, CBS All Access, and others—is already a single button press away on your TV home screen, with all the same functionality. (Many already have the option of billing you through iTunes.)
Apple’s wager, of course, is that price isn’t the only consideration here. What matters is the convenience and safety of rooting yourself ever more firmly in its ecosystem. So what if your shiny Apple Card can’t rack up miles as fast point nerds’ beloved Chase Sapphire Preferred? Apple’s never going to stuff your mail slot with pre-approval letters. Who cares if you’ll never read every New Yorker your News+ subscription gives you? It’s still right there next to Entertainment Weekly and Essence, with the bonus of no teetering stacks of issues next to your coffee table. The illusion here isn’t value—it’s choice.
Assuming you’re on board with choosing Apple, that is.
