Apple Inc. (AAPL) held a special “It’s Show Time” event at the Steve Jobs Theater in Cupertino today, rolling out all of the Hollywood glitter and showmanship it typically employs for its major product debuts.
But CEO Tim Cook correctly called this “a very different kind of event.” The tech giant outlined 4 key ways that Apple, with an $887 billion market value, plans to keep growing by diversifying away from hardware into services, including: a rash of new shows, movies and products on Apple TV; streaming video games; a new Apple credit card; and expanded digital news services. In key areas, Apple now will compete with deep-pocketed companies like Netflix Inc. (NFLX), Alphabet Inc. (GOOGL), and Amazon.com Inc. (AMZN).
Investors seemed unimpressed, pushing down the stock as much as 2% in daily trading, far steeper than the drop in the market.
Here’s a look at 4 steps that Apple is taking in an effort to reinvent itself.
Apple outlined new plans for the entertainment and streaming space with Apple TV+, yet to be priced. The platform will feature original Apple programming by employing the skills of big Hollywood and TV names, including Steven Spielberg, Reese Witherspoon, Oprah Winfrey, Jennifer Aniston and Steve Carrell, who all took the stage. Apple promised the new service by this fall.
Additionally, a new app will redesign how users find content with new Apple TV Channels. The ad-free service will be available on all devices, in one place, using advanced machine learning to create a more personalized experience. The new app will be available in over 100 countries and regions around the world, as well as on smart TVs, and with Roku and Amazon.
Apple made a big video game steaming announcement for its App Store, Apple Arcade. It’s the first mobile subscription service for “games that redefine games.” Apple notes that it won’t just be curating games, but backing their development. This all-you-can-play service, not yet priced, will be available at all times and can be found as a tab on the App Store. Users can expect the service to appear this year in over 150 countries and regions around the world.
CEO Cook spoke about the company’s goal to “replace the wallet” with Apple Pay, which it says is on target to surpass 10 billion transaction in more than 40 countries. Next in the payments world for the tech giant is a brand new service called Apple Card, created in partnership with Goldman Sachs Group Inc. (GS) and MasterCard Inc. (MA). The firm says its finance arm is hyper-focused on simplicity, privacy and security. Users can sign up on the iPhone and start using the no-fee card within minutes. Instead of points, Apple is offering daily cash back on all purchases. Apple says its interest rates will be among the lowest in the industry. Also available to Apple Pay users is a swanky titanium, laser-etched bank card with no expiration, number or signature. Apple Card is slated to come to the wallet app in the US this year.
Apples News +
Apple also announced plans to integrate its Apple News platform, which it says is now the leading News app, with a new magazine service: it launched a paid Apple News Plus subscription service. The platform boasts access to over 300 magazines across a wide range of topics, including the LA Times and The Wall Street Journal. At a price of $9.99 per month with family sharing, and the first month free, Apple says customers are gaining access to over $8,000 worth of subscriptions with a highly personalized service.
Apple’s shares have rebounded sharply in 2019 along with the rebound with the market and especially tech stocks. But its decline in the past two days, including on Apple’s major announcement today, indicates many investors are skeptical that these new products can offset the company’s slowing iPhone sales.