Apple faces difficulties in its second largest business

It’s no secret that the search for iPhones has been slowing down. The 2018 models brought little innovation and did not have the impact of other past releases.

In this sense, the company of Cupertino placed the hope in its services. These include Apple Music, iTunes, AppStore as well as Apple Care and Apple Pay.

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These services that Apple provides are the company’s second largest revenue generator. First of all are the iPhone, of course.

Tim Cook states that the success of the services is due to the number of iPhones used

Considered a 1.5 billion unit base worldwide, the iPhone sales drop is offset by Apple service revenues.

However, not everything is roses. According to one of the biggest analysts in the Apple business , this may change. Companies that sell subscriptions on the App Store are getting tired of paying the “apple fee”.

If you do not know, Apple charges a percentage of the revenue generated to companies like Netflix and Spotify. For each user, Apple receives 30% of the subscription amount in the first year and 15% in the following years. This business model is driving businesses to the point of being refused new subscriptions through the Apple ecosystem. The Netflix platform was one of them.

The Apple CFO stated that Netflix contributed less than 0.3% of total revenue for 2018. In that sense, they do not seem to be too worried. However, this “revolt” against subscription fees will increase user disarray.

There is still a Supreme Court case to examine this “apple fee” and if it is considered a monopoly tactic, Apple may see its revenue go down further.

2 COMMENTS

  1. They should face more difficulties cos that company is a very greedy company giving people less on high price. How can somebody buy a smartphone of $1000 without a fast charger included? And you want them to do well if I hear👂

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