Shares of Roku took a deep dive of more than 12% Tuesday, the steepest drop since March, after Apple said its original TV service Apple TV+ will cost just $4.99 a month. Apple TV+ launches on November 1st.
Netflix shares fell more than 3%.
Apple’s streaming product, Apple TV+, was expected, but consumers didn’t know how much they would be paying. CEO Tim Cook said Tuesday during the company’s annual launch event that the ad-free service will cost $4.99 a month for the whole family.
Netflix raised the price of subscriptions in January. It now starts at $8.99 a month. The most popular offering costs $12.99, and its premium plan is $13.99. Disney, whose Disney+ service will cost $6.99 a month, also dropped close to 3%.
MacDailyNews Take: Streaming is in a hypergrowth period, so Disney, Netflix, and others will be okay, but there is only so much time in the day and, if you get hooked on an hour-long drama series from Apple TV+, that’s an hour less you have for the likes of Roku. Consumers will weed out the services they don’t use, but for $4.99, we doubt Apple TV+ subscribers will ever drop the service. It’s simply priced too attractively to ever leave, which is likely Apple’s very smart intent.
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— MacDailyNews (@MacDailyNews) September 10, 2019