Apple drops price on new iPhone 11, undercuts Netflix and Disney on streaming
Apple Inc. tried to make cameras the focus of its iPhone launch event Tuesday, but the company’s most striking announcements concerned the prices of its phones and streaming offerings.
The first big surprise came when Apple AAPL, +1.18% revealed that it would charge $4.99 a month for its previously announced streaming video service, Apple TV+, which is now set to launch on Nov. 1. That price was lower than the $9.99 monthly fee that some analysts and reports had expected before the event, and it makes Apple’s offering cheaper than streaming services from Netflix Inc. NFLX, -2.16% and Walt Disney Co. DIS, -2.19% .
Live blog recap: Apple unveils new iPhone 11 models, $4.99 price for streaming services
The pricing announcement pressured shares of Netflix, Disney, and especially Roku Inc. ROKU, -10.49%, which saw its stock fall more than 10% in Tuesday trading. Apple shares ended the day up 1.2%.
Apple plans to launch the TV+ service in November with shows including “The Morning Show” with Reese Witherspoon and Jennifer Aniston and “See” with Jason Momoa. The company plans to add new programming on a monthly basis. Users who purchase a new iPhone, iPad, Mac, iPod Touch, or Apple TV will receive a year of the service for free.
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The company will be sticking with the $4.99 monthly price for its coming Arcade videogame service as well, which wasn’t as much of a shock. That offering will be available on Sept. 19.
Apple stuck with its three-device approach to its new iPhone lineup, rolling out a trio of devices in the iPhone 11 family featuring Apple’s A13 chip, which Apple says is the fastest ever to be in a smartphone. The cheapest of these three devices, the iPhone 11, has a dual-camera design that supports ultrawide shots and night-mode capabilities for low-light situations. The front-facing camera allows users to take slow-motion selfies, which Apple calls “slofies.”
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The iPhone 11 comes in six colors — white, black, red, yellow, green and purple — and has an hour more of battery life than the iPhone XR. Apple plans to offer the iPhone 11 for a starting price of $699, below the $749 it charged for the XR, its predecessor, at launch a year ago. The $699 price came in below what analysts had been expecting before the announcement. Apple will also be keeping the XR in stock, lowering the price of that device to $599 in a bid to make its offerings more affordable, and will offer discounts for certain trade-ins.
In a note after the event Tuesday, Wedbush analyst Daniel Ives called the price tag on the iPhone 11 “a clear indicator Apple is laser-focused on sparking further demand in the all-important China region.”
The company made a big show of discussing how its iPhone 11 Pro and Pro Max devices are the first of its smartphones to earn the “Pro” distinction, and these items remain in thousand-dollar territory. The iPhone 11 Pro begins at $999, like the iPhone XS did a year ago, while the iPhone 11 Pro Max starts at $1,099. The devices have better battery life than their predecessors, with the iPhone 11 Pro packing four hours more than the XS and the iPhone 11 Pro Max adding five hours more than the XS Max, according to Apple.
Read: Before you buy Apple’s iPhone 11, here’s the true cost over your lifetime
Both phones feature a triple-lens camera setup that includes a telephoto lens. Apple said the new camera tools help with low-light photography, action videos and enhanced portrait-mode shots. Preorders for all iPhone 11 devices begin at 5 a.m. PT on Friday, Sept. 13, and the devices will hit stores on Friday, Sept. 20.
New Series 5 Apple Watch models will feature more casing varieties and options for customization. The watch comes in aluminum, stainless steel, ceramic and new titanium casing options, and users will be able to pick their preferred band and case configurations when they purchase the device. With prior models, Apple limited shoppers to a set list of band configurations for the initial purchase and let users shop for additional colors of bands separately.
The Series 5 devices will feature an always-on display, with the GPS version starting at $399 and the cellular version beginning at $499. Apple will also be keeping its Series 3 models around, selling those for starting prices of $199 (GPS) and $299 (cellular), similar to the pricing of Fitbit Inc.’s FIT, +0.57% latest smartwatches. Fitbit shares fell after the announcement, but bounced back before the close for a daily gain of 0.6%.
For more: Fitbit wants to charge $10 a month for extra health info as it upgrades smartwatch with Alexa
Apple also upgraded its iPad lineup with a 10.2-inch, seventh-generation device meant to replace the 9.7-inch model that the company rolled out in 2018. The device starts at $329 and goes on sale beginning Sept. 30.
Shares of Apple have gained 37% so far this year, as the Dow Jones Industrial Average DJIA, +0.28% , of which Apple is a component, has risen 15%.
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