Apple One Apple definitive future war declaration: why its commitment to subscriptions will be key to its future - Apple's September event ended without big announcements: the new Apple Watch Series 6 and SE, iPad update or iPad Air redesign had previously been leaked.
Nor was there a single mention of the expected iPhone 12.
However, this keynote did serve to reconfirm how Apple is transitioning from being a more device manufacturer to being a service-focused company.
The event was broadcast live and lasted for just over an hour. Of the footage, a total of 10 minutes were devoted to services. Eight of them to Fitness+, Apple's new online training platform for users.
The other two minutes were spent by Apple on its new subscription pack: Apple one.
In those 2 minutes, Apple confirmed what was already an open secret: a unified subscription to several of its digital services. Depending on the package that users choose, the subscription will be more or less expensive. It will range from 15 to 20 euros per month.
As detailed by the firm itself in a later press release, the Individual plan includes Apple Music, Apple TV + and Apple Arcade along with 50 GB of iCloud storage for 14.95 euros. For 19.95 euros, the Family plan will include 20 GB of storage.
However, there is no news of when the Premier plan will arrive in Spain. For about $ 30, users in the United States who opt for this offer will enjoy Apple Music, Apple TV+ and Apple Arcade, but also Apple Fitness+ and Apple News+ —not yet available in Spain— as well as 2 TB of storage.
Apple One Apple definitive future war declaration
Apple earned in the third quarter of 2020 more than $ 13.16 billion from its iTunes, software and services division alone. This is a palpable increase compared to the same period last year, when it recorded 11.460 million.
Or with the data from 3 years ago. In the third quarter of 2017, Apple only recorded $ 7.2 billion in revenue for this segment, according to this chart by Statista.
Another table on the same web gives even more revealing numbers. In the third quarter of this year— the last of which there is data-22.04% of the company's revenues came from its services division.
In 2019 in the same quarter the percentage was 21.29%. In 2018, by 19.08%. In 2017, by 16%. In 2016, 14.11%. In 2015, 10.14%...
The curve continues to rise, as the company that leads Tim Cook continues to announce new solutions via subscription for its users.
The numbers grow unstoppable since Apple introduced Apple Music in 2015. Just a year ago, the company presented at another event Apple Arcade, a platform to play video games on iPhone without buying them, through a subscription system.
At the same event also announced Apple TV+, a video - on-demand platform with which the technology intends to compete against giants like Netflix.
And now comes Fitness+.
A Business Insider Intelligence Report abounded last year as big tech companies like Apple, Facebook, Google or Amazon begin to revolutionize the healthcare sector.
It detailed how many health service providers use large technologies to transform digitally. By collecting, analyzing, processing and applying patient data, you can save a lot of costs.
At the same time, big tech companies like Apple have detected in this sector an opportunity to expand their business. Apple's latest event is a good example of that.
The new Apple Watch Series 6 includes a sensor that is able to measure blood oxygen saturation in a matter of seconds, a metric that has become indispensable in the midst of the coronavirus pandemic.
In addition, as usual, the event kicked off with the usual testimonies of users of the Apple wearable telling their experiences about how thanks to this smart watch they were able to detect early that they were suffering a heart attack.
Apple has taken a step further by introducing Fitness+ as a subscription service that is added to its catalog of Health and wellness tools.
An analysis published Tuesday in the Washington Post detailed how Apple will avoid making direct economic returns through apps it develops focused on health. It thus moves away from its competitors and, instead of a traditional business model, will seek to bring economic return to this strategy by selling smart watches.
Therefore, it is not surprising that it is precisely your health-focused services that help you continue to lead the wearable market. Also with other products like your wireless headphones. Not for nothing, Apple's own store offers the Watch Series 6 as " the future of Health."
This strategy, moreover, will not only be exclusive to Apple in countries where the healthcare sector is completely liberalized. At this Tuesday'S event, CEO Tim Cook himself said that Apple has just partnered with the Singapore government in the first nationwide program to improve the health of citizens through Watch.
In the absence of iPhone 12, the almost absolute prominence of the event was taken away by the new smartwatches of the company. The wearable business barely existed only 5 years ago, but is now very well established in the future strategy of the firm.
The first thing is to receive: only having an iPhone users will be able to get the most out of the Apple Watch. For this reason, the company also announced at its event the familiar configuration program, by which an Apple Watch would not have to be rigged to an iPhone... but yes to a family member's iPhone.
In this way, the firm encourages the sale of its new Apple Watch SE, more affordable smart watches-for 299 euros-with many features to control dependent or dependent people and minors.
Also, Apple Fitness + will be compatible with Apple Music so you can listen to your favorite songs while you train.
Everything, under the cover of the new Apple one subscription, which offers packages with various Apple services and attractive offers.
Apple's services segment, which includes proposals such as Apple TV + and Apple Card (not available in Spain), as well as App Store and Apple Care revenues, is currently its second largest product segment.
The iPhone remains the most revenue asset reported to the company. But the fact that Apple has broken the $ 2 trillion market cap barrier can only be understood from the perspective that retaining a loyal customer base is what is bringing the most value to the company's futures.
Apple's first iPhone was introduced in 2007 and revolutionized the technology industry. However, the App Store, the platform by which Apple and third parties market and distribute applications and services for their devices, did not arrive until a year later, in 2008.
The technology itself presumed in a statement commemorating the tenth anniversary of the App Store that, with this platform, Apple "lit the fuse of a cultural, social and economic phenomenon that changed the way people work, play, know each other, travel and many other things".
To better understand the dilemma, a quick look at the recent history of the technology industry. Microsoft has faced several antitrust complaints since the early 2000s. One of the central themes of the debate at the time was the inclusion of the Internet Explorer browser in every installed copy of Windows on PC.
It was then understood that Microsoft had taken advantage of its position as a monopolist in the operating systems market to pave the way for its browser against competitors such as Mozilla Firefox. Things changed when Google came into play, with its popular Chrome.
A similar dilemma is faced by Apple. The Cupertino firm has not taken the definitive step: to include a package of offers or preinstalled services on their devices precisely to avoid antitrust claims as they actually already face.
Spotify, the European platform for listening to music streaming, is one of Apple's main rivals precisely in its segment. Apple launched Apple Music in 2015, as a way to close the business to Swedish technology.
In March last year, Spotify accused Apple of unfair competition before the European Commission by understanding that the Silicon Valley giant was favoring its platform, Apple Music, on iPhone or iPad operating systems.
In May this year, Spotify'S CEO continued, saying he expected Apple to open up to compete on an equal footing.
The reality is that today many iPhone users can not subscribe to premium services from their mobile phone because many companies try to skip the controversial 30% commission that Apple requires from third parties for every purchase that runs within the framework of the App Store.
This is the reason why if you use iPhone you may have noticed that you can not subscribe to Netflix or Spotify premium plans, for example, unless you do it through the phone's browser-and not the app itself -.
Far from trying to reach an understanding, Apple redoubled its efforts against Spotify by announcing Apple one. A joint subscription to several services is cheaper, on its own, than a subscription to Spotify and Netflix, for example.
Spotify made its first impressions on Tuesday night: it considered that the announcement of Apple one would help the Swedish company in its unfair competition lawsuit against the US technology giant.
Apple One Apple definitive future war declaration