CUPERTINO, California—Jumping belatedly into a business dominated by Netflix and Amazon, Apple announced its own TV and movie streaming service on March 25, enlisting stars like Oprah Winfrey, Jennifer Aniston, and Steven Spielberg to try to overcome its rivals’ head start.
The company also unveiled a news subscription service that will give customers access to roughly 300 magazines and a few major newspapers for $10 a month. And it announced a new branded credit card.
But Apple has lots of money, more than 900 million active iPhones, and a track record for innovation that has enabled it to overtake its rivals, even when it enters a business late, as it did with smartphones, tablets and smartwatches.
In the past, of course, Apple has mostly jumped into relatively small and undeveloped markets. Streaming video, by contrast, is dominated by huge services like Netflix, Amazon and Hulu, with more seeming to be bowing into the competition daily, including AT&T’s WarnerMedia, Disney and Comcast.
“Great competitors make for great consumer experiences,” Netflix said in a statement. Netflix stock rose $5.22 to $366.23 Monday. Apple’s stock fell $2.31 to $188.74.
Among the upcoming programs on the new Apple service will be Winfrey-created documentaries; a show about TV morning talk shows, starring Aniston, Reese Witherspoon and Steve Carell; a futuristic drama starting Momoa; and a sci-fi show called “Amazing Stories” from Spielberg.
Apple TV Plus will be featured in the existing Apple TV app, which brings together different streaming services such as HBO and Showtime and traditional cable subscriptions.
Video will be delivered to iPhones and iPads, Apple’s own Apple TV device, smart TVs and, soon, streaming gadgets from Roku and Amazon.
Netflix, which isn’t included in the Apple TV app, has turned “binge watching” into a worldwide phenomenon become a powerhouse in both Silicon Valley and Hollywood since it shifted its emphasis on original programming in 2013..
Apple was long focused on making on gadgets: iPhones, iPads, computers. Apple co-founder Steve Jobs toyed with the idea of building a powerful TV business but couldn’t pull it off before his death in 2011. It has taken his successor, CEO Tim Cook, nearly eight years to draw up the plan the company will now try to execute.
“Apple is very late to this game,” eMarketer analyst Paul Verna said. “Netflix has become the gold standard in how to create and distribute content, using all the data they have about their viewers.”
Industry analyst Colin Gillis of Chatham Road Partners said Apple TV Plus is “not going to be a Netflix killer.” And Martin Garner of CCS Insights said the service so far lacks “the full range and diversity of content available through Netflix, Amazon and others.”
Several analysts, however, warned not to count Apple out.
Apple has reportedly spent more than $1 billion on its original TV shows and movies—far less than Netflix and HBO spend every year. It has plenty of money to spend, though, with about $245 billion in cash and marketable securities.
As part of its effort to catch up, Apple hired two longtime Sony television executives in 2017. They have signed up stars such as Spielberg, Ron Howard and Sofia Coppola.
Apple News Plus, the news subscription service, will include such major papers as The Wall Street Journal and the Los Angeles Times. Other major newspaper publishers have reportedly been wary of Apple’s terms.
The Journal will feature general-interest articles, not its entire slate of stories, although Apple said any article the Journal publishes could be searched for on the Apple app.
Apple said advertisers won’t track readers inside the app. That will distinguish it from Facebook and Google, the other major online news hubs.
The company’s new Mastercard credit card, called Apple Card, won’t have any late fees or annual fees and will offer 2 percent cash back.
