Apple (NASDAQ:AAPL) TV+ has carved a niche with its premium content and ambitious storytelling, securing third place in U.S. audience demand for streaming originals with an 8.4% share. Despite this, its overall market share in U.S. TV screen viewing was just 0.3% in June, as reported by Nielsen. The platform’s subscriber base is estimated to be under 20 million in the U.S., highlighting a gap between critical acclaim and widespread commercial success. Apple TV+ excels in quality but struggles with quantity, impacting its broader appeal.
Other streaming services like Netflix (NASDAQ:NFLX) and Amazon Prime Video have established themselves as global leaders over the years, with significantly larger libraries. In contrast, Apple TV+’s content volume remains low, even though its high-quality offerings have received critical acclaim. This difference in content size is a hurdle for Apple TV+ as it competes for more frequent viewer engagement and retention. The challenge has become more pronounced as streaming market dynamics continually evolve.
While Apple TV+ maintains its commitment to premium content, it risks limiting its mass-market reach by focusing exclusively on high-concept shows that demand full viewer attention. Titles like “Ted Lasso,” “The Morning Show,” and “Severance” have driven subscriber growth but are not enough to sustain broader audience appeal. The service needs to diversify its content to include more mainstream programming to attract a wider audience and ensure profitability.
Expanding Content Library
To address the volume issue, Apple is exploring options to license more external content. Expanding its content library could make the platform more appealing to a broader audience. However, Apple remains cautious about diluting its premium brand image, which has been a cornerstone of its strategy. Licensing external content might be a more feasible approach compared to acquiring a major studio, which has been speculated but not pursued.
Navigating the Streaming Landscape
Apple TV+ is part of a broader ecosystem that includes Apple Music, Apple Arcade, and other services. This comprehensive package aims to drive consumer loyalty and satisfaction, leveraging the seamless user experience Apple is known for. However, Apple does not disclose specific revenue figures for each service, making it challenging to gauge Apple TV+’s direct contribution to the overall strategy. The service’s role within Apple’s ecosystem is designed to enhance consumer engagement and bolster product sales.
Apple’s investment in original content is not solely about winning the so-called “streaming wars.” The real competition lies in controlling the media experience through operating systems and aggregators. Apple TV+’s growing market share in the global connected TV device market underscores its potential to lead in this space. The company can capitalize on its technological prowess and premium brand image to create a universal streaming interface, simplifying user experience amid the increasing complexity of cross-company bundles.
Ultimately, Apple TV+ faces the challenge of balancing quality and quantity while maintaining its premium position. Other streaming services often resort to cost-cutting and price increases, but Apple has the flexibility to explore multiple avenues for growth. The company’s strong ecosystem and brand loyalty provide a significant edge, although it must continuously adapt to stay ahead. Success will depend on Apple’s ability to expand its content library and appeal to a broader audience without compromising its core values.
