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How resilient will Apple’s subscription services will be if a recession hits?

Monday May 16, 2022. 06:37 PM , from Mac Daily News
How would Apple’s subscription services — with 825+ million subscribers at last count — fare if a recession hits America, Apple’s largest market, by far?
A selection of Apple’s Services
Austin Carr for Bloomberg News:

In the last 12 months, paid subscriptions jumped by 165 million, with services revenue leaping 17% last quarter, to $19.8 billion.
But it’s tough to tell how resilient these services will be if consumer spending declines or a recession hits. Apple only discloses an aggregate subscription count and does not breakout subscriber numbers by service, meaning we have no insight into adoption or attrition rates for TV+ versus Fitness+ or iCloud. And with the last few years complicated by the pandemic, Chief Financial Officer Luca Maestri has said measuring growth can be “a bit deceiving” because “we’ve gone through some cycles of lockdowns and then reopenings and so on.”
Rising grocery and gas prices may prove to be a test of whether Apple’s services have really become essential for its customers. Tightening family budgets have already prompted some consumers to cancel superfluous apps. Netflix Inc., for one, recently reported its first subscriber decline in a decade…
Ultimately, Apple has to keep its services momentum going. The company has invested massively in marketing its subscriptions, particularly through freebies. These days, the promos are everywhere. My LG television is constantly offering no-cost TV+ trials. Ticketmaster offered me free access to Fitness+ after I bought some sports tickets. And on a recent visit to Best Buy to purchase an Apple accessory, a pop-up appeared on the credit-card machine: “PROMO- 6 MONTHS FREE OF APPLE NEWS+”—for $0.00!
Expect this sort of aggressive discounting to continue if the economy worsens.

MacDailyNews Take: Apple is working on hardware subscription, too, which go a long way towards making new hardware prices palatable to those feeling inflation’s pressure on their budget.
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The post How resilient will Apple’s subscription services will be if a recession hits? appeared first on MacDailyNews.
https://macdailynews.com/2022/05/16/how-resilient-will-apples-subscription-services-will-be-if-a-rec...
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