What’s Apple Plotting in Media Space?



Samsung to distribute iTunes movies and shows

Selling media content is part of Apple’s (AAPL) Services business, which includes brands such as Apple Music and iTunes. As Reuters reported, Apple has partnered with Samsung (SSNLF) to distribute its iTunes movies and television shows. The Samsung deal marked the second time in recent months that Apple has cut a deal to distribute its media content on devices made by its major rivals. In November, Apple struck a deal to bring its Apple Music service to Amazon’s (AMZN) Echo devices. Echo is the brand of Amazon’s smart speakers that compete with Apple’s HomePod.

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Leveraging partnerships to drive growth

The media distribution pacts with Samsung and Amazon come at a time when Apple is believed to be working on a Netflix-like video service, which could help it add to the disruption of the traditional media industry. With Samsung being the largest manufacturer of television sets and Amazon dominating the smart speaker market, partnering with them could help Apple rapidly extend the reach of its media content as it increasingly bets on its Services business to drive growth.

But Apple is not alone in leveraging partnerships to try to broaden media content distribution. Spotify (SPOT) has a pact that makes it the default music app on Samsung devices including television sets. Pandora (P) is working closely with Snapchat (SNAP) and T-Mobile (TMUS) to extend the reach of its music streaming service.

Doubling Services revenue

Apple generated $24.3 billion in services revenue in 2016 and is aiming to double that by the end of 2020.


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