Apple Could Rake In Billions From The Soon-To-Be-Launched Premium News Subscription Service

Must Read

Free Netflix in India: A Result of Slow Growth In Q3 2020?

Netflix is testing a new strategy that could lead to free Netflix in India. The online streaming...

Jio Pages: The Indian Browser Reliance Is Betting On Now!

Looks like Reliance wants to establish Jio as a synonym of technology. After launching a fleet of...

Tesla First Cancels Return Policy And Now Cuts Warranty Period

Just last week Elon Musk surprised everyone by cutting the price of Tesla Model S twice in...

Apple Inc. (NASDAQ:AAPL) is all set to launch its long-rumoured and much awaited paid Apple News subscription service at an event on March 25, as per BuzzFeed News.

The Tim Cook led company has a history of scheduling its product launches and events in late March. So if the company actually goes on to host an event at the Steve Jobs Theater on its Apple Park Campus this year too, it should come as no surprise. But for the fact that this time around, the company is said to be keen at showcasing service(s), unlike the focus on products at similar events in the past.

Apple’s Much Talked About March Event

The March events organized by the company in the past have usually been about iPad launches. This time, however, no hardware like AirPods, an updated version of the entry-level $329 iPad or the eagerly awaited AirPower charger are likely to be showcased.

Advertisements

With the company registering a decline in the sales of iPhones, it is said to be shifting its focus towards increasing and improving upon its services base.

Despite declining iPhone sales, the company continues to be hugely successful at the services front which includes, among others, the App store and its very popular Apple Music subscriptions. The revenue generated by this segment during the recently ended fiscal Q1 2019 was $10.9 billion, a 19% YoY growth.

The tech giant can, therefore, be seen pushing towards generating more revenue from online content and services.

Convinced by the potential of its services business, Apple has plans to start a news subscription service. The company is apparently gearing up to offer premium magazine and news subscriptions by integrating the recently acquired magazine app Texture into the framework of hitherto free Apple News. Though the final subscription cost has not yet been disclosed, initial reports go on to suggest that it could be priced (tentatively) at $10 a month, the same as users pay for Apple Music.

This could perhaps mean Apple rolling out a single bundle package similar to Netflix and Hulu packages for TV and movies.

Advertisements

Apple proposes to pocket half of this revenue while doling out the other half to participating publishers, based on their readership.

On the flip side, the plans to create this paid news subscription service, ‘Netflix for News’ service, seem to be running into rough weather already. Some of the major new publishers expressing displeasure over the financial terms proposed by Apple.

The company’s proposal to pocket half of the subscription fees is considerably higher than the 30% cut which Apple usually takes from service providers across its platform for the first one year, followed by 15% subsequently.

Apple wants to have at least a few committed outlets for supplying premium news related content before it announces its plans to the world.

At present, it is difficult to say if news readers who get access to premium content by paying $4 to New York Times or less than $8 to Washington Post would want to pay a much higher $10 to Apple, especially when they have the chance to access all such news from other online sources like Twitter, Reddit, etc, even if the layout isn’t too appealing.

But then Apple has 1.4 billion active devices around the world at present. If ONLY 1% of those users subscribe (i.e. only 14 million), Apple would rake in an additional $1.68 billion a year in revenue. Bundled together with music and video, the market could be many times the size.

Even after splitting the revenue with its publishers, Apple would save a neat amount every year, which is not a bad way of offsetting at least some of the losses coming its way because of weakened demand of their flagship devices all over the world. Till Apple makes a formal announcement, we can only go on to guess. They still have a long way to go (by way of placating their publishers) before their paid news platform becomes available.

Remains to be seen what Tim Cook will pull out of his magic hat this time!

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest News

Google Boots Out 3 Immensely Popular Android Apps from Play Store: Questions About Content Policing Resurface

With such a flourishing wilderness of Android apps on the Google Play Store, there is every likelihood...

Reliance Future Group Deal In The Soup: SIAC Orders To Put The Deal On Hold

When Reliance agreed to acquire Future Group for $3.4 billion, recently, the share of Reliance Industries Limited rallied on the stock market....

Can Facebook Be Trusted For Newly Announced Hosting and Shopping Services?

Every coin has two sides. For Facebook Inc. (NASDAQ:FB), the positive side says that it has launched interesting, new features to further...

When the Going Gets Tough, the Tough Gather Online

Tech shows; we all know them, love them, and wish we could get to them. Unfortunately, that's not always possible. Or is...

Flipkart, Amazon Hurtle To Secure Their Slice in Aditya Birla Fashion

The battle conch for the festive season has already been blown. Now in a bid to take control of a new frontier,...

Jio Pages: The Indian Browser Reliance Is Betting On Now!

Looks like Reliance wants to establish Jio as a synonym of technology. After launching a fleet of Jio products in the last...

In-Depth: Dprime

Will ‘TikTok By Microsoft’ Be A Winner?

For the last two years, TikTok has been in the public eye for all sorts of reasons. First, it was the exploded...

Facebook Subscription Model: Looking Beyond Ad Dollars?

Seldom do job listings create a stir this gripping. However, when the job listing in question is a stealth post from Twitter,...

Will The Online Food Delivery Market in India End Up Becoming A Two-Horse Race?

It's pretty much evident that the food delivery space in India is all set to get riled up soon enough as one...

More Articles Like This