Apple had its long anticipated services event in Cupertino on the 25th of March. Not surprisingly, Apple announced a news, TV service. The gaming service was expected somewhat. The real surprise was the card.
I collected my notes and thoughts in a Twitter Moment (if it doesn't render - you can find it here):
Apple Services Event [FtF]
MyPOV
Tech companies do not get media, so I am sceptical that Apple can pull of anything of real substance around News and TV. Most people get these services already and often for free (as bundled with other services). Granted - Apple can throw billions at this - and showed the star power at the event. But the stars will take the money, but not guarantee success. It all reminded me of Yahoo! signing Katie Couric to go into news. Why will it work today for Apple? The challenge is also to convert a free offering (Apple News) to a paid one - never easy.
The gaming offering is interesting, as it offers a syndicated view on the Apps Store for gamers. Apple may be able to charge for placement etc. but then - it makes money already and game vendors don't like it (see Fortnite bypassing the paywall). And gamers are fiercely independent - yes they may have an iPhone - but they will side load it / jailbreak it with not a moment of hesitation for the newest game.
The most interesting offering is certainly the card. Technology with NFC payments and the smartphone capabilities can certainly disrupt payments and credit cards. It's an antiquated industry, charging premiums and waiting for disruption. Apple may be able to pull this one off - though margins will be lower than selling shiny glitzy objects. If Apple (and investors) can stomach this - great opportunity.
But overall I remain sceptical. The Apple install base has stopped growing. No smartphone / phone maker has been able to revert it. When the moment is passed, the moment is passed. Services on a shrinking platform cannot right the overall enterprise. Assuming iPhone replacements will happen every 3 years, Apple needs to extract about 500$ in services soon to smoothen the bump and then over the life of a headset. A tall order. Only subscribe (and forget) can get Apple there. And there are enough Apple fans out there to do so... going platform independent is the only way. And that's easy for the card. Future will tell if and how much services can save Apple from fading.
P.S. We often talk about product companies needing to become service companies. This is a very hard transition. If one of the richest, in talent on board and acquirable as well as financial resources, company struggles so much here... what is an ordinary / regular company going to do? Certainly place frugal bets more carefully.
