Netflix versus Apple TV+: how Apple is stealing mindshare in a too crowded streaming marke...
Apple TV+ may be new to the streaming scene, but it already has stolen mindshare from the streaming giants like Netflix using a simple tool -- prestige. Here's how.
Apple TV+ and Netflix both compete for accreditation from the industry
When Apple TV+ launched in November 2019 a lot of criticism was directed at the fact it didn't have any franchises or lengthy series to capture attention. It garnered comparisons to other major streamers like Netflix and Disney+ whose back catalog of content dwarfed Apple's tiny offering.
The comparison wasn't unwarranted, but at the time, Netflix cost three times as much as an Apple TV+ subscription for hundreds of times more content. Apple made it clear it wasn't looking to compete directly with Netflix. Instead, it wanted to focus on quality over quantity and slowly build its catalog over the years.
Speculation surrounding how successful Apple TV+ could be centered around what it lacked. Critics were concerned that without long-running TV series like "Seinfeld," Apple would struggle to garner any attention, let alone subscribers.
Launch titles like 'Dickinson' struggled to be a stand out hit
Jump forward to Spring 2022 as Apple TV+ brings home the first Acadamy Award for best picture to ever go to a streaming platform -- beating out Netflix, Amazon, and Disney to the honor. Popular shows like "Ted Lasso" brought Apple TV+ into the spotlight, but "CODA" cemented it as a true competitor to other streamers.
Apple TV+ isn't a problem for the greater streaming industry because of its size, catalog, subscriber base, or even available finances -- it's a threat to attention. And as companies like Netflix, YouTube, and TikTok compete for every waking moment in a person's life, any new attention-grabbing platform is a threat.
However, those numbers pale in comparison to Netflix, which has over 2,200 TV series and around 4,000 movies on its platform -- at least according to the What's On Netflix website. There is no question that Netflix is the streaming leader because of this approach of buying everything and seeing what sticks.
Rather than disappear into obscurity due to its seemingly tiny library with no pre-existing fan base, Apple has taken over some of the streaming mindshare. As of May 2021, a report suggested Apple had around 40 million active subscribers, which was highly attributable to extended free trials for new hardware purchases. Apple doesn't provide official numbers, but the subscriber base has likely increased thanks to the increased popularity of new content.
Data from Q2 2021 show Apple TV+ at 3% market share. Chart sourced from JustWatch.
Other numbers are harder to come by, but analysts suspect Apple spent $500 million in marketing in 2021 as compared to Netflix spending $1 billion. Apple also reportedly spends roughly $6 billion on content annually, which is about one-third of Netflix's reported spend for 2021 -- $17 billion.
Clearly, Apple TV+ is a small streaming service with a slow-growing user base, but that doesn't mean Netflix should count them out. The one place Apple can compete with Netflix on equal footing is awards, and it has a lot of them.
Netflix isn't as forthcoming with this data, and thanks to the sheer number of groups with awards programs, it isn't easy to ascertain. So, we've whittled this examination down to three of the biggest United States award shows -- Acadamy Awards, Emmys, and Golden Globes.
The disparity between the two streaming services is narrowed when viewed through the awards lens. While Netflix is still the clear leader in terms of total awards won throughout 2021 and early 2022, Apple TV+ is holding its own.
Netflix has around 1,500 original movies versus Apple's 38, yet Apple has won only two fewer Oscars and was the first to take home best picture. This means Apple's quality approach seems to be working in its favor.
The vast majority of Netflix's wins for the Emmys and Golden Globes center around two shows: "The Crown" and "Queen's Gambit." Likewise, Apple TV+ saw most of its wins centered around "Ted Lasso."
As long as both platforms can find hit shows that appeal to wide audiences, they will continue to dominate awards programs. However, Apple's more targeted approach may mean more accreditation for less money over time.
Data shows of Apple's top ten shows, 'Ted Lasso' is a standout in popularity. Data from 30 Jun - 27 Sep 2021. Source: Parrot Analytics
Awards aren't everything for a streaming service, but they feed into the mindshare of potential customers. It is easier to sell Apple TV+ if it's home to the Emmy award-winning Outstanding Comedy Series and Oscar-winning Best Picture.
Netflix continues to be a powerful platform in streaming, but if it continues to increase prices with no perceivable benefit, people may choose to leave. Part of that perception is maintaining a growing list of desirable content, not just content for its sake.
There is a narrative that suggests most homes don't have space for another streaming service. The perception is that families would, at most, subscribe to three streamers: Netflix, Disney+, and a premium third option like HBO Max.
Adding yet another service to the pile wouldn't be appealing to most consumers, but Apple makes it relatively easy with a low barrier to entry. By tying accounts to the existing Apple ID system, all existing Apple customers need to do is pay, and even that is scarily simple.
For most Apple TV+ subscribers, their first experience will be getting a free trial to the service just for having an Apple ID. And yes, Apple reminds you of this free trial whenever it gets the chance.
However, Apple brought down yet another barrier to entry by introducing bundles. On its own, Apple would have trouble convincing customers to pay for Apple TV+ thanks to the extremely crowded streaming market. Still, by bundling it with other services, people will have Apple TV+ available even if they didn't seek it out directly.
In April 2022, the cost of a 4K Netflix streaming subscription is $20 per month after a recent price hike. That's the same price as the Apple One Family plan which has Apple Music, Apple TV+, Apple Arcade, and 200GB of iCloud Storage for six family members.
People won't be ditching Netflix for an Apple One bundle, but they may choose to have Netflix and the Apple One bundle for their family, which just happens to include Apple TV+. It is difficult to argue against the bundle pricing and features for anyone with more than one person in an Apple Family.
Even if Apple isn't directly affecting Netflix subscriptions, if people have access to Apple TV+ through whatever means, it translates to less time on Netflix. And that is the exact problem Netflix is trying to combat against.
Netflix is also struggling with how it addresses users about strategy changes, pricing, and new content. The company has taken an aggressive stance against sharing accounts with friends and family, which may sour the appeal of the service for many. So while other streamers are trying to bring barriers down for subscribers, Netflix is putting them up and acting as an aggressor toward its own customers.
Apple TV+ adds new shows and movies every month
The content streaming industry is at a crossroads as customers are inundated with choices. Apple has positioned itself as the affordable yet premium place to get the best programming on the planet, and that strategy seems to be paying off.
Netflix is changing its strategy since it has theoretically peaked in its growth using its existing methods. Now, the service is expected to move to advertising, low-cost tiers, and other options to broaden its potential market.
Looking at the media marketplace today, customers are tired of price hikes and promises of future content when there's so much available elsewhere. The simplicity and broad amount of content on Netflix will keep most people subscribed, but the company is in danger of alienating users.
Apple TV+, with its high awards-to-content ratio with only three years on the market, makes it a formidable upstart with plenty of room to grow. While it won't topple the streaming giants, it could easily become a foundational part of home entertainment thanks to increasing customer mindshare and ease of access.
Read on AppleInsider
Apple TV+ and Netflix both compete for accreditation from the industry
When Apple TV+ launched in November 2019 a lot of criticism was directed at the fact it didn't have any franchises or lengthy series to capture attention. It garnered comparisons to other major streamers like Netflix and Disney+ whose back catalog of content dwarfed Apple's tiny offering.
The comparison wasn't unwarranted, but at the time, Netflix cost three times as much as an Apple TV+ subscription for hundreds of times more content. Apple made it clear it wasn't looking to compete directly with Netflix. Instead, it wanted to focus on quality over quantity and slowly build its catalog over the years.
Speculation surrounding how successful Apple TV+ could be centered around what it lacked. Critics were concerned that without long-running TV series like "Seinfeld," Apple would struggle to garner any attention, let alone subscribers.
Launch titles like 'Dickinson' struggled to be a stand out hit
Jump forward to Spring 2022 as Apple TV+ brings home the first Acadamy Award for best picture to ever go to a streaming platform -- beating out Netflix, Amazon, and Disney to the honor. Popular shows like "Ted Lasso" brought Apple TV+ into the spotlight, but "CODA" cemented it as a true competitor to other streamers.
Apple TV+ isn't a problem for the greater streaming industry because of its size, catalog, subscriber base, or even available finances -- it's a threat to attention. And as companies like Netflix, YouTube, and TikTok compete for every waking moment in a person's life, any new attention-grabbing platform is a threat.
Apple TV+ versus Netflix: by the numbers
Apple TV+ has a total of 120 films, documentaries, TV series, and topical shows under its belt as of April 2022. Many of the shows have two or three seasons available as well, adding up to a formidable wall of content that would take a reasonable person months to stream on its own.However, those numbers pale in comparison to Netflix, which has over 2,200 TV series and around 4,000 movies on its platform -- at least according to the What's On Netflix website. There is no question that Netflix is the streaming leader because of this approach of buying everything and seeing what sticks.
Rather than disappear into obscurity due to its seemingly tiny library with no pre-existing fan base, Apple has taken over some of the streaming mindshare. As of May 2021, a report suggested Apple had around 40 million active subscribers, which was highly attributable to extended free trials for new hardware purchases. Apple doesn't provide official numbers, but the subscriber base has likely increased thanks to the increased popularity of new content.
Data from Q2 2021 show Apple TV+ at 3% market share. Chart sourced from JustWatch.
Other numbers are harder to come by, but analysts suspect Apple spent $500 million in marketing in 2021 as compared to Netflix spending $1 billion. Apple also reportedly spends roughly $6 billion on content annually, which is about one-third of Netflix's reported spend for 2021 -- $17 billion.
Clearly, Apple TV+ is a small streaming service with a slow-growing user base, but that doesn't mean Netflix should count them out. The one place Apple can compete with Netflix on equal footing is awards, and it has a lot of them.
Apple TV+ versus Netflix: accolades
Apple brazenly points out the number of awards it has any chance it gets. Any Apple TV+ news is usually accompanied by an ever-increasing number of awards and nominations. As of April 2022, Apple says it has 244 wins and 961 award nominations.Netflix isn't as forthcoming with this data, and thanks to the sheer number of groups with awards programs, it isn't easy to ascertain. So, we've whittled this examination down to three of the biggest United States award shows -- Acadamy Awards, Emmys, and Golden Globes.
Awards won since January 2021
| Award Show | Apple TV+ | Netflix |
|---|---|---|
| Acadamy Awards | 6 | 8 |
| Golden Globes | 2 | 15 |
| Primetime Emmys | 4 | 10 |
| Creative Emmys | 7 | 34 |
Netflix has around 1,500 original movies versus Apple's 38, yet Apple has won only two fewer Oscars and was the first to take home best picture. This means Apple's quality approach seems to be working in its favor.
The vast majority of Netflix's wins for the Emmys and Golden Globes center around two shows: "The Crown" and "Queen's Gambit." Likewise, Apple TV+ saw most of its wins centered around "Ted Lasso."
As long as both platforms can find hit shows that appeal to wide audiences, they will continue to dominate awards programs. However, Apple's more targeted approach may mean more accreditation for less money over time.
Data shows of Apple's top ten shows, 'Ted Lasso' is a standout in popularity. Data from 30 Jun - 27 Sep 2021. Source: Parrot Analytics
Awards aren't everything for a streaming service, but they feed into the mindshare of potential customers. It is easier to sell Apple TV+ if it's home to the Emmy award-winning Outstanding Comedy Series and Oscar-winning Best Picture.
Netflix continues to be a powerful platform in streaming, but if it continues to increase prices with no perceivable benefit, people may choose to leave. Part of that perception is maintaining a growing list of desirable content, not just content for its sake.
Apple TV+ versus Netflix: barrier to entry
Apple is in no danger of toppling Netflix or driving customers away from the platform anytime soon. However, it gains a mass of new content with each passing year while maintaining that $4.99 price point, and Apple has plenty of runway to maintain that price.There is a narrative that suggests most homes don't have space for another streaming service. The perception is that families would, at most, subscribe to three streamers: Netflix, Disney+, and a premium third option like HBO Max.
Adding yet another service to the pile wouldn't be appealing to most consumers, but Apple makes it relatively easy with a low barrier to entry. By tying accounts to the existing Apple ID system, all existing Apple customers need to do is pay, and even that is scarily simple.
For most Apple TV+ subscribers, their first experience will be getting a free trial to the service just for having an Apple ID. And yes, Apple reminds you of this free trial whenever it gets the chance.
However, Apple brought down yet another barrier to entry by introducing bundles. On its own, Apple would have trouble convincing customers to pay for Apple TV+ thanks to the extremely crowded streaming market. Still, by bundling it with other services, people will have Apple TV+ available even if they didn't seek it out directly.
In April 2022, the cost of a 4K Netflix streaming subscription is $20 per month after a recent price hike. That's the same price as the Apple One Family plan which has Apple Music, Apple TV+, Apple Arcade, and 200GB of iCloud Storage for six family members.
People won't be ditching Netflix for an Apple One bundle, but they may choose to have Netflix and the Apple One bundle for their family, which just happens to include Apple TV+. It is difficult to argue against the bundle pricing and features for anyone with more than one person in an Apple Family.
Even if Apple isn't directly affecting Netflix subscriptions, if people have access to Apple TV+ through whatever means, it translates to less time on Netflix. And that is the exact problem Netflix is trying to combat against.
Netflix is also struggling with how it addresses users about strategy changes, pricing, and new content. The company has taken an aggressive stance against sharing accounts with friends and family, which may sour the appeal of the service for many. So while other streamers are trying to bring barriers down for subscribers, Netflix is putting them up and acting as an aggressor toward its own customers.
Apple TV+ versus Netflix: looking ahead
Apple TV+ adds new shows and movies every month
The content streaming industry is at a crossroads as customers are inundated with choices. Apple has positioned itself as the affordable yet premium place to get the best programming on the planet, and that strategy seems to be paying off.
Netflix is changing its strategy since it has theoretically peaked in its growth using its existing methods. Now, the service is expected to move to advertising, low-cost tiers, and other options to broaden its potential market.
Looking at the media marketplace today, customers are tired of price hikes and promises of future content when there's so much available elsewhere. The simplicity and broad amount of content on Netflix will keep most people subscribed, but the company is in danger of alienating users.
Apple TV+, with its high awards-to-content ratio with only three years on the market, makes it a formidable upstart with plenty of room to grow. While it won't topple the streaming giants, it could easily become a foundational part of home entertainment thanks to increasing customer mindshare and ease of access.
Read on AppleInsider
Comments
I would also cut Disney if people would let me, and maybe add Paramount+
I am one of those people who enjoy Criterion-style old art movies but most people have the attention deficit of the hypermodern time we live in—especially if you have the demands of a two career or single parent family.
What Apple is selling is not AppleTV as much as Apple One, which I love as an Apple-centric consumer— TV, iCloud, Apple Music, Apple Fitness, News and Arcade all in one package.
AppleTV+ is a no brainer. Great shows, 4K, Dolby Atmos, Dolby Vision, etc. For less than 25% of the price Netflix charges just for 4K. Would subscribe even if it wasn't included in our Apple One package (which brings it down to less than 20% of what Netflix charges for 4K).
You highlight one of the huge advantages for AppleTV+: for a number of obvious reasons, a lot of people are evaluating their streaming subscriptions and for a number of equally obvious reasons, Netflix has a big ol' target on its forehead. Hell, you could cancel just your Netflix and call it a day as far as cutting monthly streaming subs to save money. OTOH AppleTV+ easily makes the cut in most cases at $5/month, a price Apple can maintain forever while Netflix... well, they don't have all those other profit centers to fall back on that Apple does.
Yeah, what this guy said. AppleTV+ is $5/month because if they gave it away to everyone for free - which they absolutely could afford to do - you would think there's something wrong with it. But wait, you can get it for free! If you buy an Apple device. Fking brilliant.
I disagree... but only with that last sentence and even so, only partially. There's certainly good shows on Netflix but christ is there a lot of crap and bloated series that could have been half as long. I mean, people openly joke about how mediocre most of Netflix is. Think of it in terms of branding: Netflix is Walmart (but without the obscene profits) or Kia; AppleTV+ is Nordstrom or Mercedes (but without the obscene prices).
Here's a couple other random thoughts:
- Netflix is gonna piss a lot of folks off by cracking down on password sharing. They will surely lose more to subscribers leaving over it than they will gain from it. OTOH, you think Apple gives a shit about password sharing? 1, they can afford that 'problem' and 2, you log in with your Apple ID which does a hell of a lot more than just log in to AppleTV+; you're probably only going to give it to trusted family members or a spouse.
- AppleTV+ is a slow burn, just like Apple Watch and even iPod (almost everyone forgets that it debuted in ~2001 but didn't take off until ~2004). It's only now that we're seeing how far-sighted Apple was to pursue this strategy, as expensive and as daunting as it is to build a prestige Hollywood studio from scratch.
Have I mentioned that it's a good time to buy AAPL? One of the reasons is that within the near future, Wall Street will realize that AppleTV+ is turning into a success story, which in turn builds further confidence in other Apple initiatives like Project Titan and AR as well as in Apple's management itself.I bought a new iPhone a few months back, which comes with 3 months of free AppleTV+. Every few weeks Apple emails me, sends push notifications and sets a banner message in settings in an attempt to get me to use it, which has only had the effect of guaranteeing that I will not subscribe.
Apple used to have self-serving adverts in their software pre-Jobs - who promptly put a stop to it, and it is very disappointing that they have made a return under Cook. He's so desperate for AppleTV+ to be his legacy that he's thrown many Jobsian rules out the window.
I would like to get the Family Apple One subscription, but I want News+, which means i'd have to go to the "premier" subscription. Why can't I swap Apple Arcade and AppleTV+ for news+? Since AA and ATV+ work out the same cost as News+, there can only be one reason, which is to inflate subscriber numbers for AppleTV+. Apple can claim all Apple One users are then subscribing to ATV+, even if they've never used it once.
https://techcrunch.com/2021/01/12/nielsen-says-the-office-was-the-most-popular-streaming-series-of-2020/
Having a mix of high quality originals, old favorite series for binge watching and lots of family-friendly content to keep kids entertained would make for a pretty strong streaming service. Streaming services aren't typically good for all 3 but people can afford 2-3 services. Disney is best for kids content because they have so much original IP.
A lot of content is being siloed into streaming services made by the original providers like The Office is on Peacock, which is owned by NBC, who originally produced and aired it. Friends is on HBO Max, owned by Warner Bros who originally produced/distributed Friends.
It's the same thing that happened with games. Steam/Valve started the digital game service and everyone sold the games there. Then the big companies figured out that they have enough money to make their own service and don't have to pay a commission to Valve so now there's UPlay (Ubisoft), Origin (EA), Bethesda, Activision Blizzard (Battle.net), Epic, GOG (CD Projekt Red).
Companies like Netflix, Amazon and Apple are outsiders to the industry and have been distributors rather than producers. This has been changing as they can see the popular content will keep moving to the original providers. It's good to start in distribution to see what people want and then produce what people want. This will take a couple of years to see the results.
https://en.wikipedia.org/wiki/Apple_Studios_(production_company)
Netflix has a decent budget but they still produce low quality content. Most streaming original content is like the straight-to-DVD movies that used to be made. They have the budget to produce blockbuster movies and yet they don't for some reason. Look at all the movies that came out in the 90s:
https://www.imdb.com/list/ls006658449/
Goodfellas, Shawshank Redemption, Terminator 2, The Matrix, Forrest Gump, American Beauty, Se7en, Titanic, Pulp Fiction, LA Confidential, Casino, Face/Off, Fight Club, The Mask, Good Will Hunting, Groundhog Day, Schindler's List, The Truman Show, Jurassic Park, Men in Black, Mission Impossible...
Movies used to be iconic, this is very uncommon for movies now and I wouldn't say a single movie of this caliber has come from a streaming service yet in all the years they have been running. Maybe filmmakers are running out of original stories and characters or they are just locked into the legacy distribution system but the budget they have spent should have produced better content by now.
Price is often given as the reason for cancelling Netflix:
but people spend far more on TV networks, games, cinema etc than they did on streaming. It seems more like it's just too expensive for what they offer. If all they are going to put out is straight-to-DVD quality content then it's not worth it. If they regularly had series like Game of Thrones or movies near the quality of blockbusters, the price would be much less of an issue.
First: it helps being a multi-trillion dollar company sitting on a cash pile of about $200 billion that is in the completely unique position of not even needing its streaming platform to be profitable. One example: its recent series Pachinko, which I believe is one of the great achievements in television that will sweep the Emmy awards in drama this year, was turned down by every other network and streamer because it was too expensive to make. Only Apple said yes. At least for now, Apple appears to be in this business to have a streaming platform with shows that reflect and burnish its brand image, and they get an A+ from me on how they've done so far. Apple+ shows are superb quality, beautifully produced, highly original, notably ambitious and an overall love letter to the "creative class" who are typical Apple customers.
Second: merely spending a ton of money on content doesn't guarantee great shows, as Netflix proved with its $20 billion spend on content last year. But here, too, we see a reflection of the Apple brand in emphasizing quality over quantity. Kudos to the development and programming team there because although they're taking far fewer swings compared to Netflix, they are doing a much better job of making every swing count.
Third, this may be personal to me, but I'm finding that because Apple+ doesn't churn out shows in high volume, I am much more aware of each new series they release. Other streaming platforms can be an overwhelming tsunami of shows where I feel like I haven't heard of any of them and end up with that feeling of, "there's nothing on." Even HBO Max, whose quality I also respect greatly, is largely unexplored territory for me, but they tend to have a couple of headline series that they promote and are steering viewers towards at any given time.
Of course, all of the above is extremely attractive to the most talented creatives with ambitious and original ideas, which makes it more likely that Apple+ will be their first stop in pitching a new documentary or series, and gives Apple+ the best shot at buying the best stuff, which perpetuates the way they've positioned the platform.
Fantastic job, Apple+... keep up the great work!
For example a season used to cost around €29.99-€39.99 on DVD. I’m in Europe but it’s compatible in that currency.
I haven’t seen other compelling content this year but I expect to watch a classic movie or three.
Netflix is €12/month or €144/year.
Therefore, as this article states, the total library size is irrelevant to me, what matters is what I watch annually.
But Apple can also *make* money on it in ways that Netflix cannot. For example, suppose attachment to TV+ shows helps keep people attached to the overall Apple ecosystem. If TV+ were to move iPhone/iPad/Mac loyalty up by just 1 percentage point, it might be worth the cost.