Nearly 60% of U.S. households own at least one Apple product. Many of those households own multiple Apple devices — the virtuous circle of iPhones, iPads, Macs, Apple TVs, routers, and so on that are part of Apple’s hardware and software ecosystem.
Apple has done a fair bit of work over the past couple of years to build share and stickiness in the family segment. Its core offering for families is Family Sharing, which allows up to six members in a family to share iTunes, iBooks, and app purchases across devices. Through iCloud, families can also share calendars and photos. And one of the major advantages of Apple Music, as compared to other music streaming services such as Spotify, is the $14.99 Family Membership.
With this strong foundation, I think Apple could significantly bolster its family offerings. There are three areas ripe for the picking in my view: AppleCare, iCloud Storage, and Apple TV.
For those with a multi-threaded Apple relationship, AppleCare is a bit of a mess. The typical user or group might have AppleCare on some devices but not others, with varying levels of coverage and expiry dates. Even keeping track of it all is a bit of a project. You call customer care and you might be able to get help with your phone, but not your Mac, for example.
Apple has bolstered the visibility and value of AppleCare by incorporating it into the new iPhone leasing program. Google responded with Nexus Protect for the new Nexus 5x and 6p phones.
I think Apple could make AppleCare an even greater competitive differentiator, especially since support options are so lacking in the Android and PC ecosystems. What I’d like to see is some sort of ‘umbrella’ AppleCare plan, which would cover individuals or families across multiple Apple products or services. An AppleCare Family Plan might provide live phone support for all things Apple, for one annual fee. Apple might have to separate out the insurance component of AppleCare, or provide specific coverage for devices under the umbrella AppleCare plan – say, two years for any iPhone, three years for a Mac, and so on.
iCloud is the anchor for Apple’s family-centered capabilities. But there’s one bugaboo in this: storage. Currently, iCloud storage is linked to one Apple ID. And it is expensive, especially compared with other digital storage offerings. On the one hand, Apple encourages Family Sharing through iCloud, but on the other hand, there’s sort of a disincentive to add additional family members to iCloud because all their photos, videos, and other data quickly gobble up the storage bank. It’s Apple’s version of a wireless carrier’s shared data plan.
There are lots of options for storage – Dropbox, Flickr, and so on – but none of them tie together a group’s digital content as well as iCloud does. Storage is also like online banking. Once everything is all set up, syncing nicely, and becoming the family repository for all those treasured moments and important documents, it’s a real hassle to switch to another service. I think there are three things Apple could do that would make iCloud an even more compelling offering for families. First, Apple should market more favorable ‘family storage’ options for iCloud, with discounts for multiple devices sharing an ID and using Family Sharing. Second, storage pricing should be a lot cheaper. One terabyte for $99 per year per Apple ID sounds right to me. Third, we need a new range of tools and settings for easily managing what gets sent to iCloud, what is stored or kept, and what is shared. Right now, managing iCloud can be a burden and many of the settings are buried and obscure.
Television is one of the last frontiers of a shared household product. In fact, one of the main advantages of cable is the same service is available to all of the TV sets in a household — a capability further enhanced with cloud DVR. By contrast, OTT options such as Roku or Apple TV require a separate device for each TV and each one has to be separately set up and managed. When it’s a $30 stick, pricing is less of a big deal. But with the new Apple TV and Roku 4 commanding $125-175, putting these devices on multiple TVs becomes an expensive proposition.
As Apple continues to further develop its TV strategy, which many believe will ultimately include a subscription streaming service, there are some opportunities to build on Apple’s strengths in the household as a way of differentiating in the crowded OTT landscape. In the home, this could mean an anchor Apple TV box, plus some free or less expensive, smaller, ‘satellite’ boxes for connecting additional sets in a household. Naturally, Apple’s TV service would also extend to any other connected screen, including, potentially, Android devices (like Apple Music).
Apple will also have to think through how it handles pricing for its subscription TV service. It would be a mistake to tie it exclusively to each Apple ID. Preferable would be a pricing structure similar to Apple’s Music Family Subscription, or Netflix’s ‘household’ centric pricing. I would imagine the issue of what and how extensively content will be available across a family’s multi-screen, portable universe is important part of the negotiations between Apple and the major media companies.
As Apple gets into additional product categories such as HomeKit, connected cars, streaming music, and TV, managing all these apps and content across devices and groups will also become more complex. This might require a next-generation dashboard, as a successor to iTunes and iCloud.