Is Apple One value for money?

 One of the less eye-catching, but more significant announcements from this week’s Apple announcements was the bundling of Apple’s services. It’s been a long time coming, but is it actually worth it? [blog.mindrocketnow.com]

Amongst all of the shiny new devices came an announcement that Apple will start bundling its subscriptions services into a single Apple One subscription. I’m not in the market for a shiny new device, but I do already subscribe to two Apple services separately, so this was the most significant announcement for me. And also, as it turns out, for companies like Spotify, who called it an abuse of Apple’s dominant position. Why is it such a big deal? Let’s try and answer that by example.

My iCloud subscription costs £2.49 for 200GB. My Apple Music subscription is £14.99 for a family account. An Apple One family plan is £19.95, so only a monthly medium latte more. For that extra, I get a service that I’d actually pay for, namely Apple TV+, as well as one that’s frankly meh, namely Apple Arcade. 

I like Apple TV+, I really enjoyed Dickinson and Little America, but there were too few shows for it to earn real estate in my TV watching brain, especially compared to Netflix and Amazon Prime, and not worth £4.99 per month. But at £2.47 per month, Apple TV+ is now a keeper. The price is low enough for me to not bother to cancel once I finish watching The Morning Show, because I can afford to wait a couple of months for the next show. Apple TV+ is now priced commensurate with its stature as a second tier subscription.

Avi’s first tier subscriptions:

These services have earned their spot as keepers, and are used multiple times per day.

• Netflix (£8.99 per month, or 38% of TV budget)

• Disney+ (£5.99 per month, or 26% of TV budget)

• Amazon Prime (TV is half of value of prime, so cost at £4 per month, or 17% of TV budget)

Avi’s second tier subscriptions:

These services are also keepers, because they’re cheap enough.

• Apple TV+ (calculated ast £2.50 per month, or 11% of TV budget

• Starz Play (£1.99 per month for 6 months, so 9% of TV budget)

Avi’s third tier subscriptions:

These services are only keepers for their incentive period.

• BFI Player (free for 4 months)

Looking at the numbers, you could argue that Disney+ and Amazon Prime TV are both underpriced, whereas Apple TV+ is now priced correctly. But value for money isn’t the reason why Spotify is worried.

Amazon now enjoys 98% retention after 2 years which is in no small part due to the range of services offered as part of Prime. This is clearly the direction of travel for Apple. Apple One is already priced where you can still realise value if you only use 3 out of the 4 services included. The stage is set for Apple to offer more marginal services within the cost of the subscription. Apple Fitness+ is a “free” addition later this year, if you buy the premium level of Apple One. It wouldn’t surprise me if iTunes Match is bundled with Apple One in the future (yes, it still exists, nobody bothers with it, yet it costs a whopping £21.99 per annum extra). Wouldn’t it be interesting if Apple Upgrade Programme and Apple Care+ were offered as in another bundle tier too?

What’s the alternative? Well, Google One now backs up iPhones and has a cheaper tier for less storage, but the saving is small. (Side rant: I shouldn’t need to pay Apple for the privilege of backing up my mobile devices. Every purchased hardware should come with lifetime ability to back up settings, especially at Apple’s prices.) Apple Music has many competitors, but they’re all at the same price point. So whilst there are alternatives, none are compelling. 

Apple Music has now 19% of the market (Spotify, the market leader, has 35%). The stickiness of Apple One will undoubtedly increase its market share. I’m going to sign up, and when I do, I’ll probably stay. And that’s why the rest of the industry should be worried.