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Apple discovers the pull of Leo Messi as a machine for subscriptions to its pay TV

Date: May 22, 2024 Time: 17:44:14

Apple has spent five years spending large amounts of money buying and producing original content for Apple TV+, its streaming pay-TV platform. But no series or film had generated so much optimism in Cupertino as the revolution that is taking place this summer around ‘soccer’ (football) after the arrival of Leo Messi in the US professional league, whose broadcasting rights are in the giant of the bitten apple.

The ‘hype’ seems to be crystallizing in numbers, as admitted by Apple’s CEO, Tim Cook, in the conference with analysts this Thursday to discuss the quarterly results for April to June. Subscriptions to MLS Season Pass, the additional Apple TV + service that allows you to watch US soccer, are now a source of satisfaction to the point that the management leadership will highlight it.

“We are focused on original content with TV+. Sport is an important part of that because sport is the definitive original story,” Cook said in the virtual meeting that ‘La Información’ accessed. “As for MLS, we are not happier with how the partnership is going. Although it is still early, we are exceeding our expectations in terms of subscribers, and the fact that Messi has joined Inter Miami has helped us a lot. We are very excited about it,” the Apple CEO explained in response to a question from Aaron Rakers, an analyst at Wells Fargo.

The claim of the best soccer player

The signing of Messi by Inter Miami has made the club the most followed on social networks in the US, but it has also triggered the sale of tickets and season tickets to see him both in his stadium and in the rest where he will play. Some analysts interpret the express mention of Messi and the increase in sales of the MLS Season Pass as confirmation that he has become a catalyst in the sale of Apple TV + subscriptions since it was announced in April.

The issue is not trivial for the player, the club, Apple or MLS itself. The cost of access to the platform varies depending on the country, but in the US it is 6.9 dollars a month, to which must be added another 12.9 dollars for soccer, after the company’s website. In an unprecedented contract that evokes Michael Jordan’s revolutionary contract with Nike in the 1980s, Messi created by Inter with a token of around 50 million dollars a year, but in exchange for a percentage of the sale of sports equipment for Adidas and Apple’s MLS Pass subscriptions. Neither of the two companies have revealed the details of the contract with Messi.

Therefore, the technology agreed to share part of the revenue from new subscriptions to MLS on Apple TV + after the request of the managers of the club and the MLS to sweeten Messi’s contract. The negotiation led by one of the co-owners of Inter Miami was key in the deal: the former star of Manchester United (Premiere), Real Madrid (Liga) and Los Angeles Galaxy (MLS), David Beckham. The Briton controls the shareholding of the Florida team together with the Mas Canosa family (owners of Mastec and shareholders of Real Zaragoza) and the Ares fund, co-owner of a relevant percentage of Atlético de Madrid.

Cooky emphasized in his presentation the growth that Apple has registered in the Services area, which includes paid subscriptions, which has partly offset a further decline in revenue in Products and Devices. The number of paid subscriptions has skyrocketed by 17% in the last year.

“In the last quarter, we have reached a major milestone and surpassed 1 billion paid subscriptions on our platform services, increasing by 150 million over the last 12 months and nearly doubling the number of paid subscriptions used in just 3 years” , Sure Cook.

Last in line for streaming

The stagnation in sales of iPhone phones in the quarter (-2.4%, 39.669 million dollars) was followed by the collapse in iPad tablets (-19%, 5.791 million) and Mac computers (-7.4%, 6.840 million). . However, the Apple Services category grew 8% year-on-year, to 21,213 million, with which it already has more weight in the income statement than all devices if the iPhone is excluded, which still represents close to half of revenue. from Apple although it loses weight.

On the other hand, analysts point out that the sales of services and digital content contribute greater profitability to the group if possible. In fact, Apple’s net profit rose 2.2% year-on-year in the quarter, up to 19,881 million dollars, despite the global drop in revenue of 1%, up to 81,797 million. Apple’s effective cash and treasury position has fallen by 7%, to 166,549 million, due to the greater outflow of capital for dividends and share repurchases.

In addition, the technology is spending more than $6 billion annually on content for its platform, analysts estimate, still below its competitors. Part of that money is being spent on soccer. The agreement for the exclusive broadcasting of the MLS supposes for Apple an outlay of 250 million dollars per year for 10 years. But it is one of its star content to attract subscribers. Its market share in streaming was at the bottom in the US before Messi’s arrival with barely 6%, far behind Amazon (21%), Netflix (20%), HBO (14%) and Hulu ( 11%), according to Justwatch estimates.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.

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