Reports show that Apple took a big leap on Tuesday during the global tech company’s fall product launch event. Not only did the household name share additions to new smart watches and tablets, they also introduced service subscription bundles and a virtual fitness class service. It seems Team Appl have been working hard during this pandemic despite the entire world going on hold.
It’s not new to any of us that Apple have actively been pushing Apple music, streaming videos and films as well as gaming and other services. Their approach has very quickly made them an all encompassing tech genius. With such streams and services, it attracts higher-margin business which effectively generates more profits. There’s nothing more comforting to know that your customers have agreed to pay you consistently each month; now that’s being locked into the Apple ecosystem.
It’s also important to mention that Apple now relies far less on hardware sales; a virtual class requires simply their software, and people to manage it.
Do you like the idea of having a personal GP with you wherever you go, should you need them? Well, Apple Fitness+ is a subscription exercise service that cleverly links to your Apple Watch to provide you with real-time health monitoring. Everything sounds very exciting and promising for Apple but there’s another service that may be the cherry on top.
“Apple One offers customers Apple Music, Apple TV+, Apple Arcade, iCloud, and more services in one simple plan,” the company says on its website.
Apple One will be available this winter and bundles from this service will come in three different tiers. These tiers will allow all customers to save money on Apple subscription services as opposed to paying for them separately. It will be very interesting to see how many Apple customers will readily convert to bundles from Apple One; especially if their favourite services platform is Netflix, for example.
So what are the tiers, you ask? The first tier is a combination of Apple Music, Apple TV+, Apple Arcade and 50GB of iCloud storage and will cost you $14.95 per month. For a few more dollars at $19.95 per month you can upgrade to the family plan which gives you a more comfortable iCloud storage of 200GB which you’ll have to share among 6 family members, including yourself.
The highest tier is the premier family plan which will set you back $29.95 per month, as expected it includes both tier 1 and tier 2 services but also includes Apple News+, Apple Fitness+ and a whopping 2TB of iCloud storage.
This is all very exciting for critics and fans alike to simply discuss but one question most can agree on is why now, Apple? Whilst some commend Apple for this move, others suspect this is an indication of Apple’s individual subscriptions not performing as well as they had anticipated. Bundle packages are often seen as : Increase value to customers – Marketing 101.
Peloton, the online and private indoor cycling studio services company have seen a noticeable dip in their stock prices right around the time of Apple making mention of their launch of Fitness+.
A message shared by Gene Munster, the managing partner at Loup Ventures stated: “Peloton’s bread and butter, a $39 monthly All-Access Membership, is still in good shape as they have the hardware-software integration advantage.”
Time will tell how well the bundle services do but it’s certain that Apple are no longer relying on the iPhone as their breadwinner.
Despite such a horrific past few months, the technology and healthcare sectors have survived as opportunities have presented themselves. A lockdown meant people had to stay indoors, work from home, have suitable workplace setups and the right equipment, new laptops provided for staff and in the evenings what else is there to do but check social media or binge watch a TV series? Some industries have thrived during this time.
There are plenty of growth stocks such as Netflix, Tesla, Alibaba, Facebook and of course Amazon.
Speaking of which, Amazon now has to expand its workforce due to a sudden surge in sales during the pandemic. It is reported that 100,000 new employees across its operations network in Canada and the US are required. During the quarter ended 30 June 2020 (Q2 FY20), Amazon’s net sales rocketed by 40% (on pcp) and were recorded at US$88.9 billion.
On the Q3 FY20 earnings guidance front, Amazon anticipates net sales in the range of US$87 – US$93 billion, and operating income to strike amid US$2 – US$5 billion.
Tesla Inc (NASDAQ:TSLA) plans to build three factories on three different continents towards the end of 2020, this is very crucial to keep tabs on as an investor. The electric car manufacturer’s total revenue stood at US$6,036 million, and positive free cash flow was noted at US$418 million during the quarter ended 30 June.
Fans are still waiting for the full self-driving vehicles, these electric vehicles (EVs) are expected to be completely autonomous by the end of 2020.