In short, in this day and age, Apple devices are used heavily for watching video — content is the new “software” of this generation and Apple has always created ”the whole widget” from hardware to software. Just like Apple couldn’t let big software companies like Microsoft and its Office suite set the experience for Apple users, today Apple cannot let companies like Netflix dictate the direction, the user interface and the overall experience of using their devices.
A reminder that Netflix will not participate in the Apple TV app. Had Apple not started producing their own TV shows, Netflix could continue pushing Apple around and dictating their terms because Netflix was the only game in town. AppleTV+ is changing that, Disney is changing that. Netflix will have to play Apple’s game if it wants to compete on Apple devices that will increasingly focus content on the TV app. Netflix risks being left out, isolated in its own app.
Secondly, Apple isn’t targeting selling hardware with AppleTV+. They’re deliberately sacrificing AppleTV hardware sales to instead get the most widespread adoption of TV+ worldwide, regardless of which ecosystem you’re in, because it’ll be on every TV, on every TV box and on every computer, tablet and phone. The payoff is that Apple can bundle services like Apple Music which does sell hardware. Spotify cannot compete with a package of Music+TV, simply because they don’t have the resources to produce TV. Apple Music sells iPhones, AirPods and HomePods because all of these offer the native and pure AppleMusic experience.
In closing, Apple needs to have control of the entire experience in order to provide the one they envision, without having to make compromises with content providers. AppleTV+ will pay off in that regard, not to mention how profitable big media conglomerates are on their own.