Netflix No Longer Offering In-App Subscription Options on iOS Devices

[sinsin07]

I disagree with you. Netflix wouldn't have the reach if it wasn't for Apple, a fee should be paid to the exposure each of these companies are having. Apple has made Netflix billions with it's over 1 billion activated devices around the globe, this is all about greed and just watch, Netflix will increase their fees in 2019 even though they're saving 10's of millions.

Much assumption here.
For the above to be true you would need data on:
1: How many of the 1 billion activated Mac/IOS devices use Netflix?
2: How many of the over 2 billion Android devices use Netflix?
3: How many people who have Netflix bundled TVs use Netflix?
Without those and some other data points you have no idea if Netflix reach was all due to Apple.

Side note, due to recent public comentary, outcry, whatever you want to call it, the words Greed and Apple have somewhat become synonymous (not an opinion, just an observation from many news items).

 

[sidewinder3000]

So why does Apple allow any free apps in the AppStore? And if they deserve a cut because allowing the app in the AppStore is bringing revenue to Netflix then why isn’t Apple taking a cut of of Uber and Lyft transactions? Or any other app that makes it convenient to pay with/from your phone? And why do they give companies the option of not offering IAP at all? Why don’t they tell Barnes & Nobel if you want your e-book app on our AppStore you have to offer IAP and we get a cut of each IAP transaction?

I can’t speak for Apple, but I’m guessing they allow free apps because it allows up and coming developers to experiment and grow into potential revenue makers. And it makes the iPhone a more appealing thing to buy.

 

[FriendlyMackle]

Yes, that same Netflix. I'll link to a post where I already answered this question, on page 2 of this thread. Here:

https://forums.macrumors.com/thread...s-on-ios-devices.2162657/page-2#post-26948806

In other words - Netflix is taking on debt faster than they are making money. I know it's uncool to look at the debt side of things...

I did follow your earlier link to the Mish Talk site with the chart. That was interesting! And scary. I still would like to see Netflix ultimately succeed and become truly profitable. They have moved the entire streaming market into its current state -- which I vastly prefer to old cable. If the credit bubble really does burst at some point down the line, I imagine that Netflix would be gobbled up by a competitor. And the principals would still walk away with multi-millions.

 

[racerhomie]

The problem is when you have a marketplace monopoly.

You can view any website you want on your iPhone or iPad. The App Store,which runs native code , is controlled by apple. 2 choices like this is more than good enough for most people, unless you want to steal. Plus Netflix would be banned if Apple had a monopoly on the iPhone. They only have it on the App Store. But you still have a choice. Go to Android land ,if you want that. So in a real definition, it’s not a real monopoly.

 

[sidewinder3000]

It takes money to run the App Store. Apple already does 15% after a year subscription.
[doublepost=1546047658][/doublepost]Goodbye Netflix. Never subscribing back to you. iOS’s system used to allow me to see the subscriptions I was going to renew. If you are not on this list ,wont be paying you.

I agree that it’s very nice to see all your monthly subscriptions in one place. That’s valuable to me. Makes my life easier. I don’t have to search in a bunch of different places to manage my subscriptions. Saves me time and money. And I reward companies (like Apple) who do things like that by giving them my business.

Everything has a cost. Literal cost or opportunity cost. We’ll see if Netflix changes their tune once they start losing customers from Apple’s ecosystem. And the streaming market competition really heats up and they have to start fighting for subscribers.

 

[racerhomie]

Much assumption here.
For the above to be true you would need data on:
1: How many of the 1 billion activated Mac/IOS devices use Netflix?
2: How many of the over 2 billion Android devices use Netflix?
3: How many people who have Netflix bundled TVs use Netflix?
Without those and some other data points you have no idea if Netflix reach was all due to Apple.

Side note, due to recent public comentary, outcry, whatever you want to call it, the words Greed and Apple have somewhat become synonymous (not an opinion, just an observation from many news items).

Apple is a company . Like all companies they have a greed for money. This is nothing new.

 

[sidewinder3000]

Apple is a company . Like all companies they have a greed for money. This is nothing new.

And... they are more ethical and provide more consistent innovation, value, quality and ease of use than most companies. Which is why they make so much money.

 

[FriendlyMackle]

Sorry, but you don’t seem to have a grasp of the real spending in the marketplace. Nothing you wrote refutes anything I wrote.

Disney and Apple operate, and have always operated, on a completely different business model that Netflix. Profit in all things, all the time. They don’t run charities, and they don’t do anything for free or at a loss. Netflix are a pure Silicon Valley venture capilatized startup who’s entire business model is based on speculation. They spend money they haven’t made and hope they’ll figure out a way to be profitable down the road.

Disney will not be spending “10 times more than Netflix”. Where on earth did you get that absurd, make-believe number? Netflix spends an insane amount of money on content production that dwarves all other providers in the marketplace. In 2018 Netflix spent approximately $13 billion on non-sports programming. Which blows away NBC/Univarsal at approximately $10 billion (who spreads that cash over 10 DIFFERENT NETWORKS and a movie studio.) Netflix’s spending last year was almost double that of Disney, Fox and Time Warner ($8 billion each). And it was almost double what they themselves spent in 2017, which means that there’s a decent chance their insane budget will go even higher in 2019.

Apple is spending just a billion in content and there is zero chance that they’ll ever invest Netflix kinds of money.

MoviePass was LITERALLY billed as “Nexflix for theatres”. The comparison is absolutely valid. All you can eat media for one monthly fee. Until Netflix shows a profit, they are just a scary disrupter. Maybe they will succeed, maybe they won’t. But right now they’re spending crazy money without any guarantees of long term viability.

You should really at the very least do some research yourself. A quick Google search reveals major articles, including published analyses indicating that the AT&T and Disney purchases of Fox and TimeWarner respectively, were largely in service of content acquisition for their own streaming services. That is $71 Billion which Disney spent - more than 7x Netflix's content spend for the year. AT&T spent $85 Billion to purchase TimeWarner, again with the intent of utilizing their current/library content as well as future content development. Both of these companies will have additional technical spending required to move their streaming platforms forward and scale much larger if they want to compete successfully with Netflix. In fact, Disney has spent $2.5 Billion this year on streaming capability alone for their upcoming service.

https://www.hollywoodreporter.com/n...te-global-content-spending-study-says-1167862

The $71 Billion purchase of Fox Entertainment by Disney was largely for their content catalog:
https://www.bloomberg.com/news/arti...gs-buoyed-by-theme-parks-film-studio-strength

There is more, and I'm sure more varied information. And yes, Netflix's spending will increase next year. That is a given. The question is can they hold on long enough to become profitable? I hope so. If it weren't for Netflix, none of these other services would be happening. HBO would not already be offering a standalone streaming service as they now do.

But I'm sure you do think you have an unparalleled 'grasp' on the economy and the market. Right.

 

[joueboy]

Ha! Somehow I was able to signup on Planet Fitness through the app but without the in-app purchase feature and I thought Apple already prohibited that. I think Netflix should learn from them like signup service through the app and autodraft payments fill-up on app itself.

 

[sidewinder3000]

I and many others have been using Netflix for a lot longer than I've owned any Apple devices so I have to disagree. I don't think Apple did much for Netflix except to take a 30% cut. I think for a service like this 5% would be enough for just hosting the app and accepting a payment.

Oh my lord. Yes, many Netflix customers were acquired outside of the App Store. Netflix does all the work of acquiring those people and gets all the profit. But you do realize that Apple only takes a 15% cut for customers that they deliver to Netflix, right? Traditional retailers take as much as 50%.

It’s highly likely that Netflix acquired a huge number of subscribers via the App Store. Certainly, some of them might have found alternate ways of signing up if they were motivated. But many of them wouldn’t have, and Netflix would never have gotten ANY of their money.

We’ll see how long this rebellion lasts.

 

[MacSince1985]

How much money do the TV makers get from the Netflix app built into smart tvs?

Probably nothing. They get the right to put the Netflix logo on their product, which will make the customer choose their product over one that doesn't show that logo. And Netflix gains potential new customers with every smart tv sold.

Now, does anyone know what percentage of Netflix's subscribers are subscribing through Apple?

 

[mi7chy]

Netflix wants the Apple deal from Qualcomm which is free.

 

[jdclifford]

Why?

Netflix doesn't want to pay 30% Apple tax anymore.

 

[ideal.dreams]

Smart move indeed. I have seen other app developers pass on the 30% price increase onto their customers when using their app, or they can pay "normal" price if they purchase through them directly.

 

[kruegdude]

It may seem more convenient, but centralizing all of your usage into one app will cede way too much power to that one company. Take for instance even this topic: Apple makes a device, but locks app usage down to only what can be offered through its own app store. You're not allowed to side-load apps onto your phone, everything has to go through Apple, regardless if you're a company or a consumer. Apple is the consolidator, they set the usage and restrictions, and everyone is bound to their whims now. What Netflix is doing here is trying to exert some semblance of independence of platform, product, and userbase.

All of what you said sounds like a good thing to me. What’s the downside again?
[doublepost=1546051681][/doublepost]

If Apple hadn’t created their model, they would have been paying 60-70% to the telecoms like AT&T. That’s what they required to get an app on their devices

I don’t know if that’s true but I’m willing to repeat it

 

[Stella]

More companies are doing this, and I don’t blame them.

Why pay Apple money when users can simply subscribe via the appropriate website? No need for the middle-man, being Apple.

Apple can counter this by reducing their fees. What’s better - 5% ( for example ) or nothing at all, for subscriptions?

 

[sinsin07]

Apple is a company . Like all companies they have a greed for money. This is nothing new.

Great Scott? Really?
Never alluded that anything was new.
That assumption is all on you.

 

[sidewinder3000]

You should really at the very least do some research yourself. A quick Google search reveals major articles, including published analyses indicating that the AT&T and Disney purchases of Fox and TimeWarner respectively, were largely in service of content acquisition for their own streaming services. That is $71 Billion which Disney spent - more than 7x Netflix's content spend for the year. AT&T spent $85 Billion to purchase TimeWarner, again with the intent of utilizing their current/library content as well as future content development. Both of these companies will have additional technical spending required to move their streaming platforms forward and scale much larger if they want to compete successfully with Netflix. In fact, Disney has spent $2.5 Billion this year on streaming capability alone for their upcoming service.

https://www.hollywoodreporter.com/n...te-global-content-spending-study-says-1167862

The $71 Billion purchase of Fox Entertainment by Disney was largely for their content catalog:
https://www.bloomberg.com/news/arti...gs-buoyed-by-theme-parks-film-studio-strength

There is more, and I'm sure more varied information. And yes, Netflix's spending will increase next year. That is a given. The question is can they hold on long enough to become profitable? I hope so. If it weren't for Netflix, none of these other services would be happening. HBO would not already be offering a standalone streaming service as they now do.

But I'm sure you do think you have an unparalleled 'grasp' on the economy and the market. Right.

3. I’ve done my research. But thank you for the advice.
4. Making a one-time capital expenditure to acquire a company in a single year (what Disney did in 2018) is different than having an annual budget that exceeds the content spending of all other networks and exceeds your own revenue on an ongoing, annual basis (what Netflix does). It’s an apples to oranges comparison.
4. Even with your illegitimate comparison of a one time merger and an annual budget, Disney still didn’t spend 10x more that Netflix in 2018 (by your own words it was 7x). And even with your bizarre accounting methods, Disney’s annual content spending will again “plummet” to well below Netflix’s in 2019, and and should remain there on an ongoing basis.
5. Disney has “paid” for all the content in their current repertoire. It all belongs to them free and clear. They made a profit making it, and will make money streaming it in the future. Netflix has not “paid” for their content. They are spending more than they make.
6. Disney could afford to buy Fox.
7. “Additional technical spending” on streaming infrastructure is not content. And it will also not be an ongoing expense at those levels. You are again confusing types of expenditures. I was originally discussing the sustainability of non-sports media content budgets, not overall corporate expenditures.
8. Who said that I thought I have an “ unparalleled grasp on the economy and the market”? I never did. Nor did I imply it. You are the only one who said that. Again, more assumptions and unfounded assertions from you.

 

[Abazigal]

While I think the reduction in subscription rates from 30% to 15% is a much-needed move, I do feel that Apple could, and should go one step further.

One can argue that Apple is justified in getting a larger cut upfront because of the role the App Store plays in facilitating the discovery of apps (part of the reason why the App Store got a major redesign earlier this year was precisely to keep it in the centre of iOS users' lives, so as to make it harder to third party app stores to gain momentum). However, I see little reason why Apple should continue to get a cut of that revenue in subsequent years, when they are no longer playing an active role in contributing to the popularity of the app. If I continue to subscribe to Netflix after all these years, that's because there's value in the service, through no credit of Apple's.

Sure, there are benefits to using iTunes for payment (the company never sees my payment information, and Apple helps manage all the credit card payments, which isn't cheap when you are dealing with multiple payments, plus I get to see and manage all my subscriptions centrally), but the costs involved in running the app store certainly doesn't come anywhere near to 30%.

So I think Apple might want to consider revising their payment model as such.

First year - 30% cut
Subsequent years - 5-10% cut (just enough to cover payment processing costs, with maybe just a little extra for overhead), so even a company like spotify or Netflix would be indifferent between managing the costs themselves and letting Apple handle it.

That said, for Netflix and Spotify to resort to doing this, I do feel it is symptomatic of a larger problem - namely that these services are still far from being sustainable. It's no small secret that these two companies still aren't profitable. Not by a long shot. They clearly need every last cent they can get to survive.

With Apple, Disney and who-knows-what-other-company coming out with their own video streaming services, the competition will only get stiffer. The future will be fun to watch.

 

[4jasontv]

choices like this is more than good enough for most people, unless you want to steal.

And where is the marketplace that allows me the right to resell apps I no longer use? If I could resell my apps it would give developers more motivation to improve their apps so as to compete with a used market place. Theft is claiming ownership over goods you already sold.

 

[macsrcool1234]

Why do you care unless you have NetFlix stock? It doesn't look like NetFlix will reduce your subscription (if you have one) by 30%. I have Apple stock and probable some NetFlix stock buried in a mutual fund.

There AIN'T no free lunch although NetFlix provides a lot of free lunchs with letting family members/friends log in to paying subsciptions. I have 3 or 4 sucking on my NetFlix account.

Why do YOU give a crap about IAP commission? You are not paying it. The nominal cost of Netflix subscription is the same to you, whether you pay via iTunes or directly to Netflix.

In fact, frequent 15%-20% discounts on iTunes gift cards offered an eaay way for consumers like you to save on Netflix subscriptions.

The fact that people care about commissions that one multi-billion company (Netflix) pays to another multi-billion company (Apple) is truly amazing.

For doing nothing except handling payment processing and consolidating billing. Yep, absolutely nothing. Could you think about what you say before you say it, please?

You have all missed the point entirely. This isn't just about Netflix. Many other subscription based apps pass on the costs to their customers and have higher IAP' costs.

Sounds like you need to take your own advice @mariusignorello.

 

[4jasontv]

Disney has “paid” for all the content in their current repertoire. It all belongs to them free and clear.

I see you put “paid” in quotes. Is that because you include lobbying as a form of payment? Most of Disney’s assets should be public domain.

 

[ctyrider]

You have all missed the point entirely. This isn't just about Netflix. Many other subscription based apps pass on the costs to their customers and have higher IAP' costs..

it's kind of hard to "miss a point" when you don't really have one.

Apple charges commission for selling apps and content on their App Store platform - it's been that way since the day App Store opened. Their subscription commission model where they charge 30% for the first 12 months, and then drop it to just 15% is quite reasonable by most measures.

What exactly are you proposing? That Apple charge 0% commission for using their app hosting and payment platform? It's not going to happen. Your griping is just a waste of space.

 

[JosephAW]

Maybe this means a lower subscription model coming soon to Netflix.

 

[dominiongamma]

Netflix doesn't want to pay 30% Apple tax anymore.

Can’t blame them, Apples tax is way too high should be half of that