In Q1 2023, PARQOR will be focusing on four trends. This essay focuses on "The definition of scarcity is continuously evolving away from linear. What happens next?"
Apple TV’s “Ted Lasso” will return for its third season on Wednesday. If estimates are right, it will reach 40 million subscribers globally off the bat. The expectation is it will attract more subscribers who have churned out since Season 2.
Apple’s monthly churn rate for TV+ is one of the highest in the U.S. at 6.6%, according to research firm Antenna. The more that number goes up, the closer Apple TV+ gets to losing one subscriber for every new one signed up annually. That is an especially important data point two-and-a-half years into the business: whatever Apple TV+ is for consumers as a streaming service, all available data suggests that it isn’t enough to compete with Netflix (230MM+ subscribers worldwide and a 3.3% churn rate in the U.S.).
Then again, Apple TV+ was never intended to compete head-to-head with Netflix. It is in fewer countries than Netflix (Apple in 107 to Netflix in 190), and its mission — “the new home for the world's most creative storytellers” — is markedly narrower than Netflix’s mission — “a global streaming entertainment service offering movies, TV series and games”.
But Nielsen data is increasingly telling the story that — in the U.S. at least — Apple TV+ also competes with free services like YouTube and Pluto TV. On Nielsen’s The Gauge, YouTube recently had 8.6% of total TV and streaming consumption in the U.S. and Pluto TV had 0.8% of it. Apple TV+ does not show up.
There are no simple answers to the question, “What problem —or even whose problem — is Apple TV+ solving?” One answer: Apple’s $6B seems like a protective subsidy for Hollywood.
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