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TV streaming wars intensify as Apple TV+ launches in SA

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MultiChoice’s DStv monopoly, which has led to high prices and an increasing number of unhappy customers, will create fertile ground for the potential success of Apple TV+ in SA’s pay-TV market.

This is the word from industry analysts commenting on the launch of what is expected to be the cheapest television streaming service on the market yet, Apple TV+.

Apple TV+ will cost R75, while both Netflix and Showmax charge R99 per month for their service.

In September, Apple CEO Tim Cook announced Apple TV+, the US-based phone-maker’s first all-original video on demand (VOD) subscription service, which will launch tomorrow, in over 100 countries and regions, including SA.

Apple TV+ promises a line-up of original shows, movies and documentaries, including “The Morning Show”, “Dickinson”, “See”, “For All Mankind” and “The Elephant Queen”.

The service will be available on the Apple TV app on iPhone, iPad, Apple TV, iPod Touch, Mac and other platforms, including online at tv.apple.com, for $4.99 per month with a seven-day free trial.

It will take on the likes of Netflix, Hulu, Amazon Prime and Showmax, among other leading over-the-top (OTT) video players.

Globally, analysts have predicted as many as 100 million Apple TV+ subscribers will sign up within a short timeframe, mainly due to Apple’s attractive price point.

Nozi Dikgale, researcher and media analyst at Africa Analysis, believes while the VOD market is becoming more competitive in general, Apple has a good place, driven by its affordable price model and the growing number of South Africans connected to the Internet.

“There is definitely a place for more players to enter the OTT video market in a developing country like SA, which presents more growth opportunities for these types of services,” explains Dikgale.

“When comparing Apple TV+ to its rivals (Netflix, Showmax and DEOD) to mention a few, it seems to be employing a relatively cheaper price point. Just like any other service, price is the first point of reference when a customer considers using a service.

“Apple will try to leverage its current Apple users, as well as new customers who will buy their devices. Its main key point of difference is the exclusive content, having invested on original content, which includes movies and documentaries, which will be subtitled and dubbed in almost 40 languages.”

In addition to catering for other languages, subtitles for the deaf or closed caption will be included, a clear effort that Apple TV+ is trying to cater to other niche audiences, she adds.

Apple TV+ will be bundled into new select Apple products and will be made freely available for its hardware customers for one year.

Nafisa Akabor, freelance technology journalist and blogger, says this strategic move will assist Apple to gain momentum, as its customers are known for their loyalty.

“The one-year free subscription is typically unheard of, and a very strategic move to hopefully get lasting subscribers. We’re at a point now where being tied to one ecosystem makes sense, so if you have Apple music or iCloud subscribers, why not just add one more to your devices?

DStv is at a point where it has a “monopoly categorised by high prices and unhappy customers”, in the local market, creating an opportunity for Apple, Akabor points out.

Content is king

Apple has reportedly increased its content budget from $1 billion to more than $6 billion, according to Bloomberg.

While the Netflix-like service is launching with only nine originals, it plans to add more new programmes each month.

It is rumoured to have forked out as much as $15 million an episode on some of its biggest shows, including “The Morning Show” and the Jason Momoa-led sci-fi series, “See”.

Another distinguishing factor is that the service won’t offer licensed content for its platform like other video streaming platforms do.

“With Apple TV+, we are presenting all-original stories from the best, brightest and most creative minds, and we know viewers will find their new favourite show or movie on our service,” said Zack Van Amburg, Apple’s head of Worldwide Video, during the announcement of the service in September .

“Each Apple TV+ original offers its own unique story, fresh perspective and powerful message – all meant to entertain, connect and inspire cultural conversations.”

Global critics believe a lack of a wide variety of content offerings will be the service’s biggest downfall, adding that the low price factor may not be enough to compete with content-rich services.

According to a survey conducted by research firm Ampere Analysis among US consumers, while the service’s $4.99/month price tag is considered affordable, consumers expressed a lack of interest in a line-up that is seen as not enticing enough.

Akabor comments: “In terms of content offering, it’s too soon to say. For now it looks like Apple has locked in big Hollywood stars for their launch offering. Only time will tell if that will keep subscribers, but also more shows should roll out in the coming months.”

Arthur Goldstuck, ICT analyst and MD of World Wide Worx, believes Apple TV+ is the most competitively priced of all the VOD services, and has the potential to massively disrupt the market, once it has a compelling enough range of content.

“There is a massive user base of Apple devices in SA that represents significant momentum for Apple TV+.

“For now, however, it is hard to see it competing on anything but price with Netflix, especially on originals. Most people won’t sacrifice range of original content for a few saved dollars. Over time, however, it will make for a spectacular price and content war.”

Discussing its potential impact on DStv’s market share, Goldstuck says it will disrupt only its premium subscriber base.

“Apple TV+ will not disrupt the broad offering or market share of DStv. Most of its user base does not have access to the fixed-line broadband needed for effective streaming. However, as with Netflix, it will eat into the premium subscriber base.”

Apple has not commented on the possibilities of introducing country-specific local programming in its line-up; however, Dikgale believes it will have to work extra hard to establish a substantial subscriber-base locally before viewers can expect home-grown offerings.

“One of the biggest challenges Apple will face is to gain traction in the market to acquire a big enough subscriber base to offer local content. As soon as the service gains momentum, it might possibly introduce local content or even acquire content that resonates with South Africans.”

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