Tech giant Apple held its third-quarter earnings review on Thursday and CEO Tim Cook finally offered some insight into the company’s unannounced price hike for its streaming platform Apple TV+. Cook explained that the increase was due to the growing content library on the service, which is much larger than it was when the streamer launched nearly three years ago.
“On Apple TV+, if you look at when we first priced it, we only had a very few shows,” Cook said. “We were at the beginning. We are very focused on originals only, and so we had four or five shows or so in the beginning and priced it quite low. We now have a lot more content and are coming out on — with more each and every month. And so we’ve increased the price to represent the value of the service.”
Apple announced on Monday, Oct. 24, that it was increasing the cost of subscriptions to both Apple TV+ and Apple Music. Applet TV+ increased $2 (40%) per month to $6.99 and the annual plan has moved up in price from $49 to $69 per year.
The explanation for the price increase may not satisfy all Apple TV+ customers, but Cook’s point about the amount of content available on the service now vs. at launch is a valid one. When the service debuted on Nov. 1, 2019, Apple TV+ had a scant content library, headlined by shows like Jason Momoa’s “See” and the Jennifer Anniston-Reese Witherspoon-Steve Carell drama “The Morning Show.”
Since then, series like “Ted Lasso” and “Severance” have put Apple TV+ on the map in a big way. Apple TV+ has been able to lure Friday night MLB games to its service, and will be the streaming home of Major League Soccer for the next 10 years. The larger profile has also helped the streamer attract bigger name talent, such as Jon Stewart, whose new show “The Problem With Jon Stewart“is currently in its second season.
Apple also focuses more on original shows than on licensed content for its streamer, which is more expensive to develop and produce. Not all of Apple TV+’s originals have been monster hits, but the service is sticking with its strategy of quality over quantity instead of buying up franchises or well-known IPs for its content library.
It was not mentioned in the call, but Apple’s negotiations for the NFL’s out-of-market games package NFL Sunday Ticket could be a part of the price increase equation as well. Though negotiations between Apple and the league have hit a snag recently, the subscription price increases could indicate Apple is looking to raise revenue to help finance the deal.
Subscribers may not be happy about the price increase for Apple TV+, but they’ll soon have a new and cheaper way to watch it. Apple announced the newest generation of Apple TV 4K devices was announced on Oct. 18, which will offer double the storage at a cost of $60 less. So there are still savings to be had for Apple customers, but they should expect the price increase for their Apple TV+ subscription to remain in place.
Apple TV+
Apple TV+ is a subscription video streaming service for $9.99 a month that includes high-quality original shows and movies including Best Picture winner “CODA,” popular sitcom “Ted Lasso,” and dramas like “The Morning Show” and “Severance.” Apple TV+ is also home to MLB baseball games on Friday nights and MLS Season Pass.