Apple expanding the iOS ecosystem: HealthKit, subscription TV service, and streaming music
Almost 70% of Apple's revenue comes from the iPhone, with another 12% coming from the iPad. This means that more than $8 out of every $10 paid to Apple is for an iOS device. Astounding, and also risky -- iOS is the Golden Goose, and the company needs to do everything it can to keep it laying eggs.
That's why Apple spends so much money developing and expanding its ecosystem. It already has some of the best loyalty numbers in the business, and the more iOS-only features Apple can add, the more enticing it is to non-Apple customers -- and the less likely it is that current customers will leave.
Whether it's Apple Pay, the upcoming Apple Watch, the iTunes Music and App Stores, or iTunes Radio, all of these products and services complement the iPhone and iPad. And the more that Apple's customers use, the more they're locked in.
Apple executives have promised numerous times over the past couple of years that the company will continue investing in new products (like the new Apple Watch) and services (like Apple Pay). This week, several reports have given a peek at what Apple is working on inside its Cupertino headquarters.
HealthKit service
A few weeks ago, I wrote that the Health app in iOS 8 had been a disappointing addition to my iPhone. It seemed to have a lot of potential but didn't seem to be getting much use. However, a new report from Reuters says that Apple has jumped out to an early lead among competing health services, "spreading quickly" among major hospitals, with at least 8 of the top 17 hospitals on the U.S. News & World Report Honor Roll working in pilot programs for Apple's HealthKit service, or at least are in talks to do so.
The report says hospitals are focusing on helping patients with chronic conditions like diabetes or high blood pressure, allowing doctors to get more consistent status updates on patients' conditions. The goal is to allow doctors to reach out to patients and get them needed assistance before admission to the hospital becomes necessary.
"If we had more data, like daily weights, we could give the patient a call before they need to be hospitalized," said Chief Clinical Transformation Officer Dr. Richard Milani.
Sumit Rana, chief technology officer at Epic Systems, said the timing was right for mobile health tech to take off.
"We didn't have smartphones ten years ago; or an explosion of new sensors and devices," Rana said.
As with anything health-related, it seems that the rollout and adoption of HealthKit will just take time.
Subscription TV service
Then there's a report from Re/code that Apple is again in discussions with television networks about a streaming "over-the-top" pay television service. This would likely be similar to the new Sling TV product from Dish that allows subscribers to pay for select bundles of programming delivered via internet streams like Netflix, rather than over a traditional cable or satellite television connection.
Apple has a lot of experience delivering content over the internet, building a number of its own data centers to handle huge amounts of data streams to customers downloading things from the App and iTunes Stores.
According to the report, Apple has shown demos of the proposed service to some programmers, but talks "seem to be in the early stages," with pricing and launch timing not "close to being ironed out." It's unclear if Apple would make the service available on competing platforms, but I wouldn't be the least surprised if it was available only on Macs, iOS, and the Apple TV. The company wouldn't make much money (at least not compared to the profits it's collecting on hardware) on it, similar to how the iTunes and App Stores run close to break-even. Instead, it would be one more Apple ecosystem-exclusive service.
Streaming music service
Finally, a report from 9to5Mac claims that Apple is working on a full-scale rework of the Beats Music streaming service that it acquired last year. It would include a deep integration of the Beats music service into a new version of iTunes on computers and the Music app on iOS devices. It would also include some of the same features as the current Beats service, such as cloud streaming, curated song playlists, and a $100/year price tag.
Apple is said to be dropping the Beats black-and-red color scheme in favor of a consistent and clean iTunes-esque look. This won't entirely be an ecosystem lock-in play, however -- the report claims that Apple is working on a new Android version of the streaming service as well, perhaps to show Android customers how wonderful the Apple world is. The company has offered Windows versions of its iTunes software for more than a decade, to allow Windows users to buy songs as well as sync and manage content for their iPods and iPhones.
I expect to hear more about all of these developments over the next year or two, but, as with everything rumored to be coming out of Cupertino, things could always change.
Which of these services are you most excited about? Streaming music, health, or a subscription television service? Let us know in the comments below.
