Why it’s no time for Netflix to chill

This image released by Apple TV Plus shows Jason Momoa, right, and Hera Hilmar in a scene from See. Picture: Supplied.

We’ve been anticipating the Streaming Wars for months. The traditional model for watching TV had already been somewhat disrupted by Netflix and its ad-free, enormous library of content. But many more players are set to launch or ramp up their streaming channels over the next 12 months in Australia.

The likes of Amazon, Apple, Alphabet, Disney, Facebook, Hulu, HBO, CBS and NBC are set to join the fray or improve their offerings. And that’s not to mention the local incumbents Seven, Nine, Ten, Stan and Foxtel, who are moving quickly to improve their own streaming services.

Thus far, the Streaming Wars consist of a lot of conjecture and hyperbole around what might happen in 2020. But the first big move has now taken place with the launch, at the start of the month, of Apple TV Plus.

The new streaming service certainly promised much. Of the dozen big contenders, it was one of the most anticipated. Tim Cook, Apple’s CEO, had promised that the new channel would be “unlike anything that’s been done before”.

And this is Apple, after all, which has a consistent capability to be better than everyone else when it really counts.

Ten days in, it’s fair to say that the initial response to Apple TV Plus has been underwhelming. The tech giant launched its streaming service with just nine titles. You could have watched Apple’s whole catalogue in one day and still had time for dinner.

Compare that with the approximately 40,000 minutes of content available on Netflix at any one time that, best estimates suggest, would take around eight months to consume in full.

The lack of back catalogue and relatively small investment budget for new content of $6bn mean Apple TV Plus is, in content terms, a minnow.

Disney’s streaming service will feature the company’s catalogue of Star Wars movies. Picture: Supplied

And it is not just the initial quantity that is letting the new streaming service down. None of the new shows developed for Apple has the wow factor. Quite the reverse.

Reviews for The Morning Show, with Reese Witherspoon and Jennifer Aniston, were very mixed with Variety concluding there was “not a human worth caring about in sight”. Swords-and-sorcery epic See, with Aquaman’s Jason Momoa, was widely panned by critics, as was The Verge with critics calling it “a funny show, but not on purpose”.

Historical drama Dickinson was “a muddled mash-up of modern and period sensibilities” according to Rolling Stone but was, at least, “more interesting than most of Apple’s bland freshman class”.

A silly name

To make matters worse there is also that silly name — Apple, TV, Plus. It’s almost as if Apple could not decide what it wanted to call its new streaming service so threw everything up there and pushed it all together.

A generic, poorly conceived name might sound like a minor quibble. But Apple already has iTunes and Apple TV and the average Australian, I will wager, is entirely unaware of what this new product is and how it differs from what they already own.

Plus, in the Streaming Wars ahead where the viewer will be deluged with up to a dozen different players vying for the space at the bottom of their smart TV, having a bland and slightly confusing identity really does not help.

And then there is the price of the service.

A subscription to Apple TV Plus will cost you $7.99 a month. Except it probably won’t.

If you have purchased an iPhone, iPad, iPod Touch, Mac or Apple TV recently you have probably already been prompted with a special offer of the first year of Apple TV Plus for free.

Apple almost never discounts its prices. Picture: AFP

It’s worth pausing and thinking about what this means. It signals a lot more than some free TV shows for a year. Apple is famed for two things when it comes to pricing. First, it always goes high. The iPhone’s average selling price is usually at least double that of its major rivals.

Second, Apple does not discount. Open your Sunday paper, and as sure as its raining in Hobart, there will a retailer offering 30 per cent off everything in store. Except, small asterisk, Apple products. The company has maintained a maniacal focus on avoiding any and all price promotions throughout its history. When was the last time you saw an Apple device offered at anything other than full price?

And yet here is Apple not only significantly undercutting the existing prices of streaming services like Netflix (which costs between $9.99 and $19.99 a month) but also giving away the service to most of its customers for free. When a premium player like Apple enters the market with a low price, already discounted to nothing, you know what is coming next: a promotional bloodbath.

It’s not just that we will have around a dozen streaming channels competing for perhaps three or four slots on our TV.

It’s that these channels all come from giant companies who cannot afford to be a loser in the Streaming Wars ahead. Too much future success for all these companies is tied to content and video. And if they lose now, they will never get another chance.

Winning is not the objective of the Streaming Wars. Avoiding defeat is the only goal. “It’s not about whether Netflix wins and we lose, or if we win and they lose,” Tim Cook told Stern magazine last month.

“Many people use multiple services, and we are now trying to become one of them.”

The Streaming Wars will be fought on content and price but mostly this will be a war of attrition. No one is going to be able to charge more than $9 a month for streaming for the foreseeable future and that means no one can or will make any profit. Who has the pockets and stamina to see the fight out? And who will fall by the wayside because the costs and the competition are simply too big?

And while you are pondering that question watch out for Disney+, which lands next week in Australia with a massive back catalogue and the incredible content combination of Disney, Marvel and Star Wars for the pre-promotional price of $8.99 a month. The bloodbath begins.