Apple TV+ could lure a whopping 12 million subscribers in its first year, an analyst predicts.
The streaming video service, which Apple plans to launch this fall after spending more than $1 billion on original shows, will be be playing serious catchup with rivals like Netflix. But Cupertino wields some key advantages.
Starting slow, but robust growth
Analysts at Cowen say that despite the service getting just 12 million subscribers in 2020, the figure should jump up to 21 million in the following year.
In contrast, Netflix’s subscriber base grew to 148 million during the first quarter of this year. And it’s also growing strongly, up 26% year-over-year.
Still, Apple TV+ will still be just getting off the ground for some time. It’s rumored to be launching in November with just five original programs. Many more are in the pipeline however, including projects from Reese Witherspoon and Oprah.
And it’s not really an either/or situation. Many people will subscribe to both Apple TV+ and Netflix to watch both these companies’ original content. The same goes for Disney+ and other services.
Projecting Apple TV+ revenue
A recent unconfirmed report indicates that a subscription to Apple’s streaming video service will cost $9.99 a month. If that’s correct, and so is Cohen’s subscriber estimate, then Apple TV+ could take in as much as $1.4 billion in 2020. Its revenue the next year could potentially be as high as $2.5 billion.
Cohen points out that if the report from 2017 that Apple is spending $1 billion a year on this service is correct then the company will break even once it passes 10 million subscribers. However, a more recent leak says Apple is sinking $6 billion developing original content, though not all in the same year.
It seems it will be a while before Apple TV+ starts bringing in a profit.