Information hidden in app reveals how much Apple will charge for Arcade
One estimate calls for Apple Arcade to sign up 29 million subscribers by 2024
Apple Arcade will join Apple Music, Apple News+ and Apple TV+ as features that bring in recurring revenue to Apple. It’s all part of the company’s plan to take advantage of the 900 million+ iPhones active around the world while lessening its reliance on new iPhone sales, which peaked in 2015. The services unit, which includes the aforementioned subscription-based features, the App Store, Apple Pay, AppleCare, iCloud and more, is Apple’s second-largest in terms of revenue and is it’s most profitable. Apple is targeting $50 billion in services revenue for next year, which would double the $25 billion the unit grossed in 2016. During its most recent earnings announcement covering the fiscal third quarter (April through June), the firm took in a record $11.5 billion in revenue for the division, up 12.7% from the $10.2 billion it took in during the same quarter in 2018.
Banking firm HSBC expects Arcade to garner as many as 29 million subscribers by 2024, raking in $4.5 billion. However, that estimate is based on a monthly subscription rate of $12.99 a month; that would seem to be too steep a price hike over a short period of time if Apple does indeed debut the service at $4.99 a month. So HSBC’s analysts are going to have to go back and rework the estimate.
Some of the titles that you should expect to find when Apple Aracade launches include:
- Hot Lava
- Oceanhorn 2: Knights of the Lost Realm
- Beyond a Steel Sky
- Sonic Racing (yes, starring “that” Sonic)
- LEGO Brawls (yes, starring those LEGO)
- No Way Home
- Yaga
These are games that you won’t find elsewhere. And by offering you a free trial period, Apple is looking to get you hooked on the service. It is the same approach that the company takes with Apple Music. And if Apple does price Arcade at $4.99 a month, it might seem like a bargain to those who were expecting it to be priced at $9.99 a month or more. The failure or success of Arcade will go a long way toward determining whether Apple hits its goal of $50 billion in services revenue next year.