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Mar 25, 2019

Apple shows off Apple TV+ video service in challenge to Netflix

Apple plots collision course with Netflix as streaming wars heat up


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Apple Inc. unveiled its next take on TV, challenging Netflix Inc. in the competitive video streaming market.

At a star-studded event in Cupertino, California, on Monday, the technology giant unveiled an original content service called Apple TV+, a revamped TV app, and an Apple TV channels service for tapping into outside providers including HBO, Showtime, and Starz.

Zack Van Amburg and Jamie Erlicht, who run Apple’s (AAPL.O) original video programming, introduced the TV+ service by playing video featuring Steven Spielberg and Ron Howard. Then, a slew of big name celebrities working on movies and TV shows for Apple discussed their projects.

Spielberg, Oprah Winfrey, Jennifer Aniston, Reese Witherspoon, Jason Momoa, Alfre Woodard, J.J. Abrams, Sara Bareilles, Kumail Nanjiani and Steve Carell talked about their upcoming work.

Apple said pricing and availability for the TV+ service will be announced later this year. Netflix charges US$8.99 to US$15.99 a month in the U.S. Apple’s offering will stream in more than 100 countries and launch in the fall. It won’t have advertising.

Apple didn’t unveil a bundle of multiple subscriptions at the event -- something analysts and investors were watching for. The shares fell 1.9 per cent, while Netflix (NFLX.O) rose 1.2 per cent.

Peter Stern, Apple’s vice president of services, showcased the new Apple TV app which is redesigned with a Watch Now tab that suggests content to watch. The key new element is a new Apple Channels service, that lets users tap into content from HBO, Epix, Starz, and Showtime. The redesigned TV app also includes sections for sports and kids programs, the company showed.

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The new Apple TV app will be available on all of Apple’s major devices in May, except for the Mac, which will add the service in the fall. It will also be available on smart TVs from Samsung Electronics Co., Sony Corp., Vizio Inc. and LG Electronics Inc. The app will also make its way to the Amazon Fire TV set-top-box and devices from Roku Inc.

While Apple is late to the video streaming market, it has at least 1.4 billion active devices out there, giving it a huge potential audience. The company will push the service via its existing TV app on iPhones, iPads, and Apple TV set-top-boxes. Oprah cited that opportunity on Monday at the event.

Apple is embracing services to boost revenue as the company’s three big hardware markets -- smartphones, personal computers and tablets -- stagnate.

Netflix’s transformation from a DVD-by-mail service into one of Hollywood’s largest studios has convinced many technology companies that they too can make hit TV shows. Amazon now spends an estimated US$5 billion on programming each year, while Facebook Inc. (FB.O) and Snap Inc. are funding shows on a smaller scale.

In a sign of how competitive the market is, YouTube has canceled plans for high-end dramas and comedies. Netflix already has more than 139 million customers, while Hulu and Inc. have tens of millions. Walt Disney Co, AT&T Inc. and Comcast Corp. are about to sell video services of their own as well, and already own large studios that pump out new TV shows and movies.

But Apple has a leg up on many rivals because customers are used to consuming digital content through the company’s devices. The iTunes store has been one of the largest online sellers of TV shows, movies and music for years, while the company’s Apple Music service has 50 million subscribers.

Erlicht and Van Amburg, who Apple hired from Sony Corp. to oversee its Los Angeles-based studio in 2017, have spent billions of dollars to acquire projects. Other tech companies like Microsoft Corp. and Yahoo have announced grand plans to produce TV shows and movies, only to retreat within a couple of years.

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