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According to foreign media reports, although Apple TV+ has not yet flourished, the investment bank JPMorgan Chase told investors not to give up this service for the time being, it is expected that its users will reach 100 million within five years. In an investor report seen by AppleInsider, JP Morgan chief analyst Samik Chatterjee believes that by fiscal year 2025, Apple TV+ paying users may reach 100 million.
Although the content and applications of Apple’s streaming service are basically unremarkable.
Chatterjee predicts that most users are currently using free promotions, but there are few promotions for qualified users. Current data shows that only 5% to 15% of qualified equipment takes advantage of this free year.
Part of the reason people have been unresponsive to Apple TV+ may be that it has too few product categories, and Apple is actively improving it. There were 8 original programs when Apple TV+ was launched, but now it has increased to 28. This order of magnitude is much less than that of its competitors, even for new platforms like Disney+.
Although Chatterjee pointed out that quality is important, it did not make any statement about this quality. Right now, Apple TV+ is competing for outstanding talent and making the winning content stand out. The analyst added that improving the quality and quantity of content will increase the possibility of converting promotional content into paying customers.
In addition to quickly securing and adding new content, Apple also seems to surpass its competitors in terms of spending. The initial report showed that Apple will allocate 1 billion US dollars for content development, but now this figure may be as high as 6 billion US dollars. Some of these investments can also drive Apple TV+ subscribers through podcasts.
The analyst also outlined some signs that Apple TV+ is rapidly developing. As an example, Apple TV+ can open an opportunity for Apple’s service business to develop more extensively and surpass the iOS ecosystem.
Chatterjee wrote: “Although the Apple TV+ app has been slow to date, we believe investors should not ignore its long-term prospects at the moment, because we see that improvements in quality, quantity and budget will jointly promote the increase of the app (users).” Analysts predict that by 2025, Apple TV+ paying users will reach 100 million.
The analyst pointed out that Apple TV+ paying users will grow slowly throughout 2020, but it is expected that renewal users who exceed the current trial period will account for a considerable proportion, and Apple’s installed base will also increase.
JPMorgan’s target share price for Apple remains unchanged at $365. This is calculated based on a mixed price-to-earnings ratio of 22.0x and earnings of $16.86 per share.
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