Netflix Inc. (NASDAQ:NFLX) dominance of the content streaming business faces its biggest test, now more than ever. Apple Inc. (NASDAQ:AAPL) unveiling a less expensive streaming service is the latest tailwind that the streaming giant will have to shrug off, to affirm its dominance. In addition to Apple’s threat, Walt Disney Co. (NYSE:DIS) is another player lunging on the horizon with a new streaming service.
Apple Streaming Service
Apple streaming service will go live on November 1, priced at $4.99, more than half of what Netflix charges. In a bid to attract subscribers into the streaming service, Apple is to offer a free one-year subscription to customers who buy any new Apple device. This is part of a marketing strategy, which Apple is using in the race for subscribers in the lucrative industry.
Netflix growth appears to have slowed in recent months, as depicted by the recent earnings report. In the U.S, the company is under immense pressure to attract more subscribers amidst a proliferation of more streaming services. Growth in the international market also appears to have slowed as the company drew less new subscriptions in the recent quarter.
Apple entrance continues to send shockwaves in the streaming industry given the amount of cash it has, to develop as well as acquire content for attracting subscribers. Netflix has dominated the streaming business in part because of its ability to spend billions of dollars to license and develop original content. It may now have to spend more if it is to hold on to its market share especially with the entry of Apple and Netflix.
Netflix Disney Roku Shares Plunge
Netflix shares falling by 3% on Apple unveiling a streaming service indicates growing concerns as to whether the streaming giant will be able to shrug off the iPhone maker threat. However, it is not the only company feeling the pressure. Disney, which is also in the process of launching a streaming service, saw its shares fall 2%. Roku Inc. (NASDAQ: ROKU), was the hardest hit as it shares fell 12% on the Apple announcement.