Revenue Model partnership between Apple and Starbucks Assignment | Get Paper Help

A revenue model, part of an overall business model, is simply the method by which the business will sustain itself by income from customers/clients and the venues that will be used to attract business. The revenue model should include all possible avenues of customer or client purchases and the expected income per individual purchase.

Based on your research of the partnership between Apple and Starbucks, you need to respond to the following items:

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Item 1: Propose a supply chain diagram to illustrate the incorporation of the two companies, the musicians that supply the music to be purchased, and the delivery to the customers. Can any part of the supply chain be outsourced? Why would this be a good or bad idea? Justify your answer in terms of cost. What other technologies and companies are involved in this exchange given that Starbucks does not provide its own wireless service? You need to cover this item in 2 pages.

Item 2: Construct a revenue model diagram for the purchase of songs played at the Starbucks location. What revenue will be gained by Apple and what revenue will be gained by Starbucks in this partnership? Suggest at least two other partners aside from coffee shops that may benefit from a similar partnership with Apple in terms of location-based usage. How would this mutually benefit both partners? You need to cover this item in 2 pages.

Your report should include:
A description of Apple and Starbucks
Information flow diagram
Partnership between Apple and Starbucks
IT infrastructure of Apple and Starbucks
2-page revenue model and related questions mentioned in item 1 above
2-page supply chain and related questions mentioned in item 2 above
US Reference used not older than 4-5 years, APA 7th format and citation, clear understandable sentences



IT Information Planning: Apple and Starbucks Partnership

May 18, 2020

















Apple and Starbucks partnered in 2007 in which customers can now enter the store to enjoy a nice up of coffee and browse, search, and download music from iTunes Music store right on their electronic device. For this experience to take place, the partnership must obtain a wireless network that can transmit and receive data over a few hundred feet for customers to connect to the internet and enjoy the Starbuck’s iTunes playlist. The partnership also requires mobile pay technology for purchases and payments along with apple pay technology and the iTunes music store software.

It starts with Starbucks providing free Wi-Fi (Wireless Fidelity) for customers to connect and log in to the wireless network. Starbucks created their own digital network to give customers access to new information and content that is only available at Starbucks. They provide these services through their partnership with AT&T and helps to facilitate iTunes downloads. To log on, simply select “Google Starbucks” WiFi network, and when the Starbucks WiFi landing page loads, complete the fields, and click “Accept & Connect”. Starbucks also provides their own mobile payment system starting in 2011. There is a charge of ninety-nine cents per download and about ten dollars for a CD. Starbuck’s mobile payment service is based on a barcode-based payment system that include loyalty rewards for returning customers (,2018). This barcode-based payment system can store large amounts of data, it can be scanned from any screen and is encrypted for safety. When the code is scanned, the horizontal and vertical lines are decided by the software on the device and converted into words or characters that serve as a payment confirmation when transactions need to be made (Sorensen,2019).

In addition, customers also have the option to make purchases of coffee and their music downloads through apple pay. Apple Pay is accepted at more than half of the U.S. merchants and has one of the largest mobile payment systems. Apple payaccepts electronic banking cards such as Visa, MasterCard, American Express and prepaid cards.It is only available on iOS devices such as iTouch, iPhone, iPad, and Apple Watch. The consumer adds their method of payment to the virtual wallet and funds are available through the electronic device.  The two payment systems coming together between Starbucks and Apple allow the companies to have more power in reaching out to their customers. The next part in the process that needs to take place for the customer to have the full Starbuck and Apple experience is access to iTunes. The customer can download music from Starbucks’ playlist (provided by Apple services) or enjoy a complimentary song or CD download. Apple from a logistic point will only have to handle iTunes (Perez,2018).

Furthermore, iTunes is needed for the Starbucks and Apple partnership to exist. Starbuck’s partnered with Apple to promote interaction activity for their customers while enjoying a cup of coffee. Customers can search, buy, and download music from the iTunes music store using Starbuck’s Wi-Fi while enjoying a meeting with friends or studying with a snack and refreshment. The iTunes app can be viewed on iPhones, iPads, Apple MAC, Androids, or Microsoft PC. With the access of iTunes, customers can listen to digital music and watch videos during their visit  Starbucks also presents a “Pick of the Week” in which customers can download new music and new videos each week that was picked by Starbuck’s entertainment team and iTunes for free .

There are a range of other IT management and infrastructure services that should also be provided through the partnership of Starbucks and Apple such as help desk services to single-point-of-contact assistance; data center services, network and server monitoring and support; equipment procurement, configuration and maintenance, as well as asset tracking and installs, moves, adds, and changes for a wide range of devices.

Who is responsible for the support of the components of the infrastructure?

Starbucks started off with using AT&T as its wireless network provider, but customers were having to make a 3.99 payment to connect to the internet if the customer was not already an AT&T member. In 2013, Starbucks switched their Wi-Fi services to google. Google and Starbucks along with level 3 communications, allows for free internet access that is stronger and faster in connection. Starbuck’s T1 line for 1.5-megabit speeds were updated to Google’s level 3 of communication. Starbucks is also in partnership with T-Mobile for other advance network and LTE (long term evolution) opportunities along with T-Mobile Hotspot which aides in downloading songs faster. The Hotspot also allows for flexible connections through Bluetooth, data networks and more to support the partnership between Apple and Starbucks.

In 2018, Starbuck’s required customers to provide their first and last names, email addresses and ZIP codes to access the internet. Before the change, customers were able to connect to the free Wi-Fi just by agreeing to the terms and conditions.Customers who connect on a device once will remain connected on the same device on a future visit to a company-owned store without any data connectivity cost. Again, apple will be responsible for providing the iTunes software (Tibken,2013).

Identify the possible points of failure in the exchange and Identify the Consequences of Each

Technology is not perfect, anda lot of technical issues can occur during each step of the process. internet hackings can cause a release of private information to the public. Possible points of failure that occur during the exchange of series between Apple and Starbucks include connection issues and log in errors. Issues that can arise from the Starbuck and Apple platform include connectivity issues regarding Starbuck’s Wi-Fi or cellular devices hot spot which may cause a slowdown in downloads for customers.The T-Mobile Hot Spot may not turn on or their may be issues with broadband connection that causes poor speed and signal.This can also cause delays when browsing the internet while customers are engaging in meetings or using online resources and can make customers frustrated. If customers experience constant connection issues, they may not return for business which can cause a decrease in sales. A reduction in sales may force Apple and Starbucks to seek their business elsewhere when it comes to providing wireless services to customers.

On the other hand, Apple’s services or iTunes store can have connection issues as well. iTunes serves music through iCloud and apple pay for payment services. These two functionalities of the system can stop working due to connection errors or a failed payment system. iCloud failures can cause lost of data or customers will not be able to access the music store. Customers may not want to use Apple services anymore if there are constant connection issues or it could ruin their coffee and music experience. If there are connection issues regarding the payment system, Apple may not get paid for all downloads causing a lost of revenue. Another possibility would be overcharging customers which in return makes customers irritated to call in for refund services. Having issues in the iCloud services can cause a huge disruption in partnership between Apple and Starbucks if customers are constantly dissatisfied.

Apple and Starbuck’s payment systems are both combined to give customers flexible payment options. The two-payment system run on different platforms which can sometimes cause technical interchangeability issues. The Starbucks app-based payment system uses barcodes rather thanNear Field Communication (NFC), and thus it was not affected by the slow roll out of newPoint of Sale (POS) systems in the United States (Miller,2019).


There may also be log in issues since these are two separate interfaces that are integrating or a mishap of privacy breach which will also result in a loss of customers and loss of either company’s trust.

What are the long-term effects of failure?

It is expected for technology not to be perfect and for there to be limited connection issues, lagging concerns or a shutdown of payment services. Long term failure is achieved when issues are constant without resolution. If the system between Apple and Starbuck integration failed completely then there may be a permanent loss of business, customer, and revenue.  If their connection issues are frequent when customers are trying to download songs, then a customer could lead a bad review online which is permanent and can be refer to deferring customers away from the business. If systems fail and reviews are left online, other business may not want partnership with T-Mobile and going to other competitors. Companies can occur dept overtime and must file for bankruptcy.

In conclusion, a value chain is a series of activities or processes which aims at creating and adding value to an article (product) at every step during the production process.The logic behind it is simple; the more value a company creates, the more profitable it is. When more value is created, the same is passed on to the customers and thus further helps in consolidating a competitive edge. Starbuck and Apple create good faith with customers to have awell-designed and pleasing storewhich are complemented with good customer service provided by the dedicated team of employees in green aprons.





Perez, S. (2018). Starbucks’s mobile payment service is slightly outpacing Apple’s. Retrieved May 18, 2020, from payment-service-is-slightly-outpacing-apples/

Sadat,S.(2015).Starbucks IT Infrastructure and Architecture. Retrieved from

Starbucks – The Best Coffee and Espresso Drinks. (2018). Retrieved from

Tibken, S. (2013). At Starbucks, AT&T is out and Google is in for Wi-Fi. Retrieved from

QR code payments – what is it and how does it work? (2020). Retrieved from






Apple Device and Platform

May 25, 2020










Protocols utilized for the purchase of an MP4 at a Starbucks location

MP4s, also known as MPEG-4 are one of the more common video file formats used for downloading and streaming videos from the internet. It’s a versatile and compressed video format which can store audio, subtitles, and still images. The protocol to connect wireless access such has MP4s, must be of highest security and quality.  Starbucks protects and safeguard theircustomer personal information, by using technical, physical, and administrative security measures to reduce the risk of loss, misuse, unauthorized access anddisclosure ofthe customer information. Therefore when transmitting sensitive information such as a credit card number through their website or to purchase  MP4 applications, the transmission is encrypted so that information using the Secure Sockets Layer (SSL) protocol. Starbucks use a variety of technologies to collect information about their customer device, the use of their websites and mobile applications. These technologies include cookies, web beacons, java scripts, entity tags, and HTML local storage (Privacy Policy 2020). Digital rights management (DRM), an approach to copyright protection for digital media is also used to prevent unauthorized redistribution of digital media and restrict the ways consumers can copy content they’ve purchased. Starbuck also use DRM-free MP4 format for their customers to deliver lots of restrictions to the media files to protect content with high-grade encryption and prevent unauthorized access, copy, download and print (Privacy Policy 2020).

Is the iPhone the ideal device for utilizing the iTunes service?

Apple devices create the perfect atmosphere for Apple’s iTunes platform. Apple creates products such as their iPhone to be intuitive and easy to understand. ITunes was created for users to download and enjoy listening to music and currently also offers view of movies, videos and TV shows. This versatile platform can be used on most devices such as iPhone, iPod, iPad, Mac, Marcos and Windows. IPhones can be seen as the ideal device to use on iTunes due to its compatibility, reliable connection and easy access. ITunes is already installed when users purchase an iPhone and is free to use. IPhones have internet capability that allow iTunes to easily connect and easy for the user to download music with limited loss of connection or slow downloads. IPhones are easy to carry and allow consumers to fit the device in their pocket. The user can now enjoy music while taking a walk to Starbucks whose store also houses iTunes music download capability (Quoc,2018).

How does this device enable e-Commerce?

E-commerce is the ability to buy or sell products through internet services. The iPhone have features to revolutionize how we shop online. IPhone devices house apps to allow consumers to purchase music from iTunes and shop online using Apple pay services. Apple Pay allows the user to connect their Visa, MasterCard or prepaid debit cards to their iPhone to represent a virtual wallet to allow easy access to funds without having the physical card available. Apple pay allows secure pay through a feature of Face ID for face recognition to access funds. Face ID ensures there is only a “one in a million” chance a stranger could unlock your phone. Facial recognition enabling users to seamlessly unlock, sign in, and pay with their phone with an ease of mind that their information is secured. The iPhone also offers an app store in which Marketers can fill out fields to make their eCommerce app more findable in search and persuade consumers to download in the Apple app store. Apple iPhones also use AR technology to enhance the e-commerce environment by allowing users to virtually try one makeup or clothes through vendors such as Gap or Sephora for more confidence in buying (Quoc,2018).



What makes Starbucks an ideal location for this exchange?

Starbucks is a multinational chain of coffee houses that millions of consumers visit every day to buy coffee, smoothies, pastries and food. It is most known for its calm atmosphere and accommodating seating arrangements to host meetings, study or to hang out with friends. Music has played an essential role in the Starbucks experience for over 40 years (,2020). Starbucks environment and services allow Apple iTunes services to thrive, giving customers to integrate with their purchase and listen to music. This allows the perfect formula for increased revenues. Starbucks provides a free wireless network for customers to connect to while also handing out free complimentary music downloads.

















“Convert Purchased ITunes Movies to MP4 on Mac.” How to Convert Purchased ITunes Movies              to MP4 Video Format. Retrieved from            itunes-movies-to-mp4.html.

Quoc,M.(2018).How the iPhone X will transform the eCommerce Landscape.Retrieved from         

Privacy Policy.2020 (n.d.). Retrieved from            information/online-policies/privacy-policy#cookies

Starbucks Coffee Company. 2020(n.d.). Retrieved from


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