Apple TV+ offering credits to paying subscribers
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After extending its introductory free trial offer twice, Apple TV+ will now issue up to $24.95 in credits to paying subscribers.
The streaming service, first launched in November 2019 and priced at $4.99 per month, initially offered a free one year trial to anyone who bought an eligible Apple device after September 2019.
In the fall of 2020, when many of these initial trials were set to expire, Apple began sending emails saying the free trial would be extended until February 2021.
In mid-January 2021, the company announced another extension until July 2021.
Now, the company is sweetening the deal by crediting paying subscribers’ Apple IDs with $4.99 per month (or local equivalent) for February through June 2021. $4.99 is still the published monthly subscription fee for Apple TV+.
Those still on the free trial will not receive credits.
That means that someone who paid to subscribe for the entire eligible period of February to June will end up with nearly $25 to spend with Apple.
Apple likely sees this as a way to maintain is subscriber base an increasingly competitive OTT and streaming market — without risking a mass defection when free trials expire.
Depending on how Apple’s accounting is set up, it may also allow the company to book revenue while all or part of the credit value can be counted as a promotional expense.
While its price point is one of the lowest among major streamers, Apple TV+ has been called out for its relative lack of content.
Unlike some of the larger streaming services, Apple TV+ only includes original content produced exclusively for the platform — no previously released movies or TV shows are included.
Apple is also continuing to pour money into more content, including a WeWork inspired series and an additional season of “The Morning Show,” one of the service’s initial big draws.
Although Apple doesn’t release subscriber breakdowns for its services, at least some of people receiving credits are likely those who subscribe to Apple One.
Apple One offers a discounted flat monthly rate to access multiple premium Apple services, including TV+. Apple One debuted in October 2020 and has three tiers, all of which include Apple TV+.
The lowest tier is priced at $14.99 a month, which is exactly one penny more than it would cost to subscribe to, for example, both Apple Music and Apple TV+ — but it also includes access to Apple Arcade and 50GB of iCloud storage. Apple says the plan saves $6 a month over a la carte pricing.
It is worth noting that those who signed up for Apple One right away got 30 days free of the services they were already paying for — but there would have been at least several months of full price billing even though the subscriber could have been potentially eligible for the continually extended free trial of Apple TV+ if purchased without One.
In other words, Apple One subscribers were technically paying (albeit at a discounted rate) for Apple TV+ for several months when they could have gotten it free if they somehow were able to continue on the extended free trial.
This latest offer could be a way to help keep Apple One customers happy as well. Apple has highlighted aggressively growing its subscription services business vertical as a goal — an appealing move thanks to recurring revenue.
This latest promotion isn’t a refund since the value can only be spent on select Apple ID purchases via the App Store. It’s also not a free trial since at least some customers will still technically be billed.
It also means Apple isn’t actually paying out the $4.99 a month to subscribers since the purchases made using the credits will be made at full list price, which includes the revenue share Apple pockets on these purchases and presumably include a profit.
In that sense, the promotion works more like a rebate that can only be spent at Apple.