Apple is turning aggressive on the services end of the business and eyeing emerging markets like India with a more cost-effective consolidated plan called Apple One.
Services remained the second biggest contributor to Apple’s growing revenue after iPhones for several quarters. In Q3, Apple’s global revenue from services climbed to $13.156 billion from $11.455 billion a year ago.
Apple’s paid subscriptions grew more than 35 million sequentially and at the end of Q3 ihad over 550 million paid subscriptions across all services, up 130 million from a year ago.
Though India is still not one of its key markets, Apple has been trying to change that with mid-range models like iPhone XR and iPhone 11. Interestingly, many of the Apple users have not subscribed to their services and Apple is trying to change that with the consolidated plans.
The pricing of the new plans is very aggressive and competitive compared to other markets like US, feels Navkendar Singh, research director, Client Devices & IPDS, IDC India.
“This will lead many Apple users who were not on any of these services to get into the service fold now. That is huge in itself for Apple. It enhances the relationship with customer from mere hardware to recurring revenue subscription of these services,” added Singh.
The new plans give Apple users access to all major services, including Apple Music, Apple TV+, Apple Arcade and 50GB iCloud storage, for a single monthly subscription fee of ₹195, for individuals. The family plan, which can be shared with up to six family members, includes all the above services with 200GB of iCloud storage. It costs ₹365 per month.
“If you look at a typical home, some users may be into TV streaming while some may be more into gaming. A consolidated plan covers all the requirements for the family in a more cost-effective manner,” said Faisal Kawoosa, chief analyst and co-founder, techARC.
Apple claims, by subscribing to the individual plan users save over ₹177 per month, while family plan subscribers save over ₹200 per month. When subscribed individually, all three major services Music, Apple TV+ and Arcade cost ₹99 each, while 50GB iCloud costs ₹75.
Kawoosa feels, a single subscription gives Apple a chance to sign many more new users, but it may not necessarily help them sell more devices, especially in markets like India, where people have access to several low cost alternatives.