Here’s Why Apple TV Might Be Netflix’s Scariest Rival

Netflix (NASDAQ:NFLX) has done a fantastic job of maintaining its economic moat and shutting out much of the competition that many thought would have a good shot at taking away the streaming king’s crown. Undoubtedly, the barriers to entry into video streaming were quite low. That’s a major reason why a ton of streaming rivals popped up on the scene, hungry for a piece of that Netflix success.

As it turned out, it’s easy to break into the streaming world, but it’s not so easy to dominate and make significant sums of profit. In many ways, it seems more about the content strategy than the streaming technology itself. And with AI standing in its corner, Netflix has stayed dominant and could continue to squeeze the competition as the consumer environment becomes a bit harder, and some folks look to cut out the number of monthly subscriptions to save money for hard times.

Netflix’s moat has been hard to get through

Netflix has come a long way since the ominous depths of 2022. The ad tier has been a success, and with a strong push into live sports (most notably boxing), Netflix seems to be the streamer that many rivals will strive to imitate, but struggle to take out. While Netflix certainly seems safe from the wave of rivals, especially as content expenses weigh heavily on some of its rivals (less content could mean fewer subscribers, which, in turn, means less spend for new content. However, there is one streaming rival that I think could become a serious contender to Netflix over the coming years: Apple (NASDAQ:AAPL) TV, which recently rebranded its streaming service from Apple TV+.

Now, there aren’t a ton of new shows on the platform, at least not on the magnitude of Netflix. However, Apple TV is really hitting quite a few home runs of late when it comes to must-see shows. Many folks have described Apple TV as more akin to the likes of HBO than anything else, given its focus on a very high-quality, high-rated content.

Additionally, Apple is a deep-pocketed behemoth with ample cash to spend. Unlike many of its Mag Seven rivals, it isn’t sinking a ton of capital into the development of AI models. Such cash can be redirected towards higher-ROI opportunities out there, such as streaming.

Apple is gaining momentum. It might have what it takes to be a force in streaming

Though Netflix and Apple TV have vastly different business models, I do think that Apple TV has been gaining some serious momentum of late. Arguably, Apple TV could be the most exciting growth engine within the iPhone maker’s dominant services business. With Vince Gilligan’s new hit show Pluribus setting a record for the biggest drama series launch on the platform, while garnering impressive reviews from critics, it appears Apple has, once again, raised the bar on the quality of its content.

The early success might be a precursor to something even bigger, especially if things pick up going into the second season (there are two seasons ordered for now).

Either way, combined with The Morning Show, Severance, and Ted Lasso, Apple TV is quickly becoming a must-have streaming service, just like Netflix. And with next season’s MLS games coming to the platform at no additional cost, there are bound to be a ton of viewers tuning in to watch the great Lionel Messi doing his magic on Inter Miami. Also, let’s not forget about the Formula 1 broadcasts that will see Apple TV be the exclusive streamer for the next five years.

In short, Apple is adding value, and that will justify price hikes further down the road.

Where does Apple TV go from here?

It’s taken quite a while for Apple TV to really get going. But Apple’s motto seems to be that it likes to do things “better” than the competition. Given its recent momentum in sports and shows, I do think Apple TV stands to gain significant ground in the coming years. With Apple poised to make an even bigger splash into sports (beyond soccer and F1 racing) while continuing to release award-winning originals, perhaps Netflix may have finally met its match.

Moving ahead, it will be interesting to see how many more sports the firm can bring aboard. Given that Apple has the opportunity to change how broadcasts are done for the better, it will be an interesting field to watch.

The shows and sports bases seem well covered, but moving forward, the big question is whether Apple can ramp up on original films so that its platform can have a wider selection of flicks. This could prove pricey but worthwhile, especially since Apple has gone a different direction, standing by its originals, rather than chasing volume for the sake of increasing the content library.

Either way, Apple TV is gaining serious momentum, and I think it’s just as indispensable as Netflix, even as consumer budgets get tighter.