“Netflix is fueling a surge of revenue growth for Apple’s App Store, according to data released by analytics firm Sensor Tower on Tuesday,” Anita Balakrishnan reports for CNBC. “Spending rose 130 percent year-over-year in 2016 in the “entertainment” category of the App Store, which includes HBO Now, Hulu and Netflix, according to data from Sensor Tower. Netflix in particular saw revenue hit $58 million in the fourth quarter, up from just $7.9 million a year earlier, Sensor Tower said, in a report released on Tuesday.”
“Apple has said it wants to double its “services” revenue, including the App Store, by 2020,” Balakrishnan reports. “‘[I]f we wanted to do what everybody else is doing, then you’re right, we might be better off buying somebody or doing that,’ Eddy Cue, Apple’s head of content, said at Recode’s Code Media conference earlier this month. ‘But that’s not what we’re trying to do. We are trying to do something that’s unique.'”
MacDailyNews Take: Eddy thinks a screamingly derivative melange of “Shark Tank” and “The Voice” based on financing app development is not only “unique,” but also will sell Apple Music subscriptions, so… yeah.
Some might say that Eddy Cue is Apple’s Steve Ballmer. We wouldn’t necessarily disabuse them of that notion.
Balakrishnan continues, “Sensor Tower’s data shows why industry watchers, like technology investor Eric Jackson, have said Apple ‘clearly should have bought Netflix.'”
Read more in the full article here.
MacDailyNews Take: As as we wrote last May:
What is unique about Netflix? A handful of TV series are not worth $40 billion. Apple is perfectly capable of taking on Netflix without having to buy them, deal with integrating their employees, etc.
Until Apple actually buys Netflix, we’ll keep saying that Apple will buy Netflix for the same reason they bought Palm.
And, as we wrote earlier this month:
Now, Disney, for example, would be a much different story, as it teems with synergies for Apple Music, iTunes Store, iBooks Store, App Store, Apple TV, etc.
That said, there have been a number of smaller deals that Apple blew for whatever reason regarding specific content properties that could have made Apple TV quite a different proposition than it is today, including NFL Thursday Night Football streaming exclusivity and/or The Grand Tour, to name just two would-be game changers.
With the amount of money Apple has, even wildly overpaying for the right content in order to maximize the install base for things like Apple TV might prove to be a smart move over the long run.
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