Apple Hires Key Netflix Engineer in Bid to Boost Subscription Services -- 2nd Update
By Tripp Mickle and Joe Flint
Apple Inc. recently hired one of Netflix Inc.'s top engineers,
part of a broader strategy to build out the technical team
supporting its newly launched TV-streaming and subscription
Ruslan Meshenberg, who helped build out Netflix's platform and
was involved in key initiatives to create a speedier, more
consistent service for viewers, joined Apple's internet-services
organization this week, according to people familiar with the hire
and his social-media accounts. He joins Apple at the same time it
is expanding its $4.99-a-month TV+ service with other new hires,
additional shows and movies -- a complex undertaking that has
tripped up other entrants into the video-streaming business.
Apple is shifting its approach to cloud services, saving money
by relying more on third-party providers. The company last year
assigned responsibility for more of its internet-services
operations to Michael Abbott, a former engineer at Twitter Inc.,
according to people familiar with the matter. He has been adding
experienced engineers to Apple's technical team.
Over the years, Apple has struggled -- relative to technology
rivals -- with the performance of new services as they rolled out,
including Maps, iCloud and its music-streaming business. For
instance, its subscription magazine service, News+, faced criticism
from tech reviewers and analysts because it failed to sync across
Though Apple TV+ hasn't had serious issues since its launch, Mr.
Meshenberg has the experience to help Apple address technical
challenges. At Netflix, he ran much of the infrastructure that
guaranteed television shows and movies played reliably, even as the
company expanded to more than 50 countries and streaming increased
to more than one billion hours of programming weekly.
He didn't respond to requests for comment.
The importance of the engineering behind new streaming services
was spotlighted when Walt Disney Co.'s flagship streaming service
struggled with technical glitches as it racked up 10 million
subscribers the day of its debut. Some users couldn't log in and
others couldn't view TV shows and movies, or experienced repeated
buffering. The service's performance has since improved.
Apple TV+ started in November with a small catalog of nine
programs. The company has ambitions of adding dozens of shows and
movies, as well as broadening the service's appeal outside of the
U.S. with international series. Apple recently signed former HBO
Chief Executive Richard Plepler to a 5-year deal and has also
reached agreements for shows with Steven Spielberg and others.
Chief Executive Tim Cook said Tuesday during a call with
analysts that Apple will judge the success of TV+ by how many
subscribers it collects. He said that was why Apple was aggressive
with its pricing -- which undercut rival Disney by $2 -- and
bundled the service free of charge with the purchase of a new
iPhone, iPad or Mac.
The company on Tuesday declined to report the total number of
TV+ subscribers, but finance chief Luca Maestri assured investors
that those sales would contribute to Apple's growing services
Amid volatile iPhone sales, Apple has looked to grow through
services such as iCloud subscriptions, mobile payments and
app-store sales. Steady revenue growth in that business last year
contributed to the doubling of Apple's share price.
Apple on Tuesday reported a deceleration in services growth.
Sales of services rose 17% to $12.7 billion for the quarter ended
in December, falling below the forecast of Wall Street analysts. A
resurgence in iPhone sales -- which tumbled a year ago -- helped
the company deliver a record quarter.
The results showed "the fallacy that services growth could ever
offset a declining iPhone given iPhone's size," wrote Chris Caso,
an analyst with Raymond James. "Nonetheless, with iPhone growth
resuming, we think services will continue to be a helpful
Write to Tripp Mickle at Tripp.Mickle@wsj.com and Joe Flint at
(END) Dow Jones Newswires
January 29, 2020 17:24 ET (22:24 GMT)
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