The sheer volume of mobile devices in circulation is hard to ignore. It also explains why HBO (owned by AT&T), Showtime, CBS and Starz could show up on Apple’s service Monday. That scale explains how Apple Music, a streaming service the company started offering in 2015, garnered more than 50 million paying users so quickly. Their reach is minuscule compared with Apple, which has more than 1.4 billion devices in use around the world, including more than 900 million iPhones. Amazon Prime has 97 million, but not all are watching its videos. Comcast, the nation’s largest cable company, has 25 million broadband customers. Netflix has 60 million customers in the United States, making it one of the largest distributors in the country. Another way of putting it: Silicon Valley companies are wary of what their next door neighbors are capable of.
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Netflix executives are worried the tech giant will crack the streaming code faster than Comcast, according to two people familiar with the company who were not authorized to talk publicly. It’s meant to be a one-stop shop for your streaming needs, not so different from what Apple is proposing.Ī nuance worth noting: Netflix is willing to work with Comcast - a competing distributor - and not with Apple because Netflix sees Apple as the bigger threat.
They can also go through Comcast to purchase an HBO or a Netflix subscription.
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Customers who only have Comcast’s broadband service can spend an extra $5 a month to get free streaming movies and TV shows from ad-supported services like Pluto and YouTube. Not coincidentally, Comcast announced its own streaming bundle just days ahead of the Apple showcase. The same might be said for Hulu, Amazon or Comcast, all of which fund original content while also marketing other content from channels - like HBO or CBS - within their platforms. It’s a service that aims to serve up shows for all kinds of viewers, from people who like the teenage thriller “You” to those who are tempted to click on the tile for the dystopian Polish sci-fi show “1983.” Netflix has long maintained that its brand isn’t about any particular aesthetic, like HBO’s. Netflix’s programming strategy is something of a mystery, because there isn’t a clear through-line on the shows it buys or makes, resulting in a hard-to-define hodgepodge. “House of Cards” and “The Crown,” to cite two examples, are licensed. Although the company promotes its many “originals,” it doesn’t actually own a lot of the shows associated with the service. Apple’s shows are likely to be free for a period to entice users into other subscriptions, such as CBS and HBO and Starz, with Apple functioning as the reseller.īut Netflix is also in the resale business. The main draw is the bundle, the one-stop service for all kinds of media. Witherspoon and Jennifer Aniston, is just the appetizer. But original Apple fare, like the program set at a morning show starring Ms. The focus on Apple’s programming makes for a tantalizing narrative, given how long Silicon Valley in general and Apple in particular have remained agnostic about owning content. The companies are battling for credit card numbers, email addresses and direct access to consumers.
Retaining the brand is as important as owning the data.Īpple and Netflix (and others) are now in competition to become the main pipe for digital video - what television is fast becoming - and fixating on other contests, like who wins the most Emmys, is secondary to owning the pipe. Further muddying the company’s identity, from the Netflix point of view, would be the fact that Apple users who spooled up “Stranger Things” or “Orange Is the New Black” may not be aware that they’re watching a Netflix show. And if it had joined forces with Apple, Netflix also would have received little to no data about who is subscribing or watching its stuff. Put it another way: Netflix is a service, or a pipe, that would sit on another service, or pipe, if it agreed to be included in the Apple bundle. And so we’ve chosen not to integrate into their service, because we prefer to have our customers watch our content in our service.” We want to have people watch our service - or our content on our service. Hastings explained it at a Netflix event earlier this week: “Apple’s a great company. Netflix’s absence from the new platform says a lot about the state of play in the highly competitive streaming industry: a fight is brewing over how content is distributed. In a second sign of frayed relations between the two companies, Netflix has decided to opt out of the Apple bundle, which will upsell subscriptions to HBO and CBS in addition to its original programming.
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