Can Apple TV+ make a dent in Indian OTT with its aggressive pricing?

Topics Apple  | Apple Inc | Apple Inc

Apple announces streaming service Apple TV+
Apple may be late to the game, but its entry into internet video streaming is bound to cause ripples and shake up the status quo.

Last week, the Cupertino-based tech giant unveiled Apple TV+, its over-the-top (OTT) video service that will be available on Apple devices, a bunch of smart TVs and third-party streaming services. Apple TV+ will hit the screens on 1 November.

The move pits Apple against Netflix, the global force in OTTs, Amazon Prime Video, Roku and many strong local players. Only a few months earlier, The Walt Disney Co, one of the biggest content studios and production houses on the planet, said it was getting into OTT with Disney+, that is set to launch also in November.

India already has over 30 OTTs fighting aggressively for customer’s wallet-share and screen-time, and Apple’s success in the region would depend on it turns the levers of pricing, local content and distribution.

At the Cupertino launch, Apple trumped audience with its pricing strategy. In India, the OTT service is priced at Rs 99 a month, making it one of the cheapest here, and marks a huge departure from the exuberant pricing Apple is known for.

For perspective, Netflix starts at Rs 499 a month, Hotstar at Rs 299 a month while Amazon Prime Video is priced at Rs 129 a month. Only Zee5 and SonyLiv have plans starting at Rs 99 a month. Apple is also throwing in freebies like seven-day free trial on Apple devices, and one-year free subscription on new Apple devices.

There is also a big focus on distribution. Apple knows that it has limited devices in the market, far lower than Android smartphones or tablets, which may curtail the reach of the video platform. For that the company is making Apple TV+ available on smart TVs from LG, Sony and Samsung, on Amazon Fire TV, and Roku, a streaming devices company. Audience will also be able to watch on Apple TV+ website.

This marks another departure as Apple has traditionally hooked users to a closed ecosystem, offering little inter-operability in devices, services or app store.

Content is the biggest differentiator and pull-factor in Internet video streaming. In this area, Apple TV+ will launch with nine original shows, which includes The Morning Show, featuring Jennifer Aniston and Reese Witherspoon, Jason Momoa-starring drama See and a show by Oprah Winfrey.

There isn’t any news from the company if and when Apple TV+ will have local programming.

Meanwhile, Indian OTTs have established strong foot-hold in the content market. Hotstar has programming from all Star channels; ZEE5 has shows from Zee Network, while Netflix has created chart-topping original shows like Sacred Games and Lust Stories that have brought audience to its platform. Netflix spent $12 billion overall on content last year.

According to estimates from the Boston Consulting Group, India’s OTT industry is seen to grow to $5 billion by 2023 from $500 million in 2018.

The video platform is Apple’s bet to grow revenue from services at a time when devices sales are tepid globally. Apple’s global iPhones sales were down 12 per cent, at $26 billion in the June quarter, while services revenue grew 17 per cent to $11.5 billion.  

Major streaming services in India and their prices

  • Netflix: Rs199/mo (smartphone and tablet), Rs499/mo (one device), Rs649/mo (two devices), Rs799(four devices)
  • Hotstar: Rs299/mo, Rs999/year
  • Amazon Prime Video: Rs129/mo; Rs999/year
  • SonyLIV: Rs99/mo, Rs499/year, Rs299 (6 months), Rs29 (7 days)
  • ZEE5: Rs99/mo, Rs999/year, Rs599 (6 months)

Source: companies’ websites

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