“Apple is officially open for business in Hollywood,” Peter Kafka reports for Recode. “The company is telling content makers it wants to spend $1 billion on its own stuff over the next year. That’s music to studios’ ears, and a tune they have been expecting for some time — especially after Apple hired two top Sony TV executives in June.”
“For context: HBO spent about $2 billion on content last year, and Netflix is spending $6 billion. While Apple is now formally competing with those guys for content, it certainly doesn’t want to beat them,” Kafka reports. “It wants them streaming their shows on Apple devices, and selling their services via Apple’s iTunes store, where Apple can take a cut of the monthly fee.”
Kafka reports, “But Apple’s all-but-official announcement is a sign that it’s done with its first, halting effort to make its own programming, which it used to augment its Apple Music service.”
Read more in the full article here.
“Combined with the company’s marketing clout and global reach, that immediately makes Apple a considerable competitor in a crowded market where new media players and traditional media companies are vying to acquire original shows,” Tripp Mickle reports for The Wall Street Journal. “Apple could acquire and produce as many as 10 television shows, according to the people familiar with the plan.”
“The budget will be in the hands of Hollywood veterans Jamie Erlicht and Zack Van Amburg, poached in June from Sony Corp. to oversee content acquisition and video strategy,” Mickle reports. “Programming costs can range from more than $2 million an episode for a comedy to more than $5 million for a drama. An episode of some high-end shows such as “Game of Thrones” can cost more than $10 million to produce.”
“For its video service to gain relevance, Apple needs at least one hit, according to the people familiar with the plan. The company’s initial video efforts — Planet of the Apps, launched in June on Apple Music, and Carpool Karaoke, launched last week — were criticized by reviewers,” Mickle reports. “Mr. Van Amburg and Mr. Erlicht have begun meeting with Hollywood agents and holding discussions about shows Apple could acquire, the people familiar said. The men also hired former WGN America President Matt Cherniss to oversee development, the people said.”
Read more in the full article here.
MacDailyNews Take: Finally!
We just got a lot more excited over Cupertino’s plans for Apple TV.
Apple should use their cash pile to create some much needed leverage to finally get their Apple TV subscription bundle(s) up and running even if all they do is flash their cash around. — MacDailyNews, January 14, 2016
Cook should consider bidding for and winning NFL Sunday Ticket away from Direct TV, buying rights to Premiere League and La Liga games, etc. and making them Apple TV exclusives. Go directly to the sports leagues with boatlods of cash. Maybe that’ll grease the wheels. It’ll certainly move a bunch of Apple TV boxes around the world in short order. — MacDailyNews, May 6, 2014
SEE ALSO:
Former WGN America president Matt Cherniss joins Apple in latest TV push – August 15, 2017
Rivals leaving Apple behind as Apple TV remains stuck in a test pattern – August 8, 2017
Apple’s so-called TV ‘strategy’ continues to be an embarrassing joke – June 30, 2017
Apple poaches Sony TV executives to lead major push into original content – June 16, 2017
Hulu and NBCUniversal ink expansive agreement to bring top channels to Hulu’s upcoming live TV streaming service – May 1, 2017
YouTube to unveil virtual cable bundle for $30 to $40 a month – February 28, 2017
Stalled talks with Ron Howard highlight Apple’s content confusion – February 16, 2017
Apple vowed to revolutionize television; currently prepping an unremarkable 4K Apple TV instead – February 16, 2017
Apple TV: Still not ready for prime time – February 15, 2017
Apple hires Amazon’s Fire TV head to run Apple TV business – February 8, 2017
Apple’s new TV app shows just how painfully behind Apple is – December 14, 2016
Are you ready for 4K TV? Apple TV isn’t. – November 28, 2016
Apple has no idea what they’re doing in the TV space, and it’s embarrassing – November 3, 2016
Hulu inks deals with Fox and Disney, adding ESPN, Fox News and more to forthcoming live service – November 1, 2016
Apple’s Eddy Cue: Nope, we don’t want to be Netflix – October 20, 2016
Google signs up CBS for planned web TV service to debut in early 2017; close to deal with 21st Century Fox – October 20, 2016
Apple’s Eddy Cue: Nope, we don’t want to be Netflix – October 20, 2016
Apple’s Eddy Cue alienated cable providers and networks with an assertive negotiating style – report – July 28, 2016
Here comes á la carte programming – without Apple – July 13, 2016
Apple TV 4 is a beta product and, if you bought one, you’re an unpaid beta tester – November 5, 2015
This sounds like a huge step in the right direction.
I think that the secret to success with projects like this is to devise truly brilliant scripts. It’s much easier to say than to do, but it’s something that Pixar have always understood and while you might not always like what they produce, they have had a remarkable number of blockbusters.
It’s a bit like how Apple already make their products anyway. Put in a lot of effort behind the scenes towards getting all the little details as perfect as you can before you start production.
agreed.
Waste of money….
Waste of money…
That’s a really decent budget for one year’s content for a company that’s not in the video streaming business. I hope they get something worthwhile watching. It’s really quite amazing how much Apple can actually afford to spend and that billion dollars really just amounts to pocket change for Apple. It surprised me that Netflix is paying $6 billion a year for content and supposedly Netflix is quite profitable. Wow!
this is not even close to a core competency for Apple and its got no business wasting capital on it
Is Cue in charge?
More crap like “Planet of the Apps”?
Create original content in five or six genres, make them exclusive on AppleTV, encourage fans to create video podcast dedicated to each episode.
Create a bundle price for Apple Music and Apple Shows, maybe $35 family plan and $25 individual plan.
Apple is not yet in a position to demand $15-20/mo premium for original content, not when Netflix charges ~$10 and includes not just dozens of their own original titles, but thousands of other studios’ titles. And especially not when their only other noteworthy original content to date, “Planet of the Apps”, was such a bomb.
Apple Music, they can get away with $10-15/mo because that’s on par with streaming competitors e.g. Spotify, plus they have deals through their acquisition of Beats. Apple has none of that in the TV and movie space.
The explanation is quite simple. Apple would like some compelling content to support sales of Apple TV. The owners of that content are not prepared to make it available on terms which are acceptable to Apple. Therefore the best way forward is to invest the money into makinge desirable programmes made exclusively for Apple.
It’s a solution that works on multiple levels. Obviously Apple gets the programmes it wants. Apple is one of the few companies able to finance an operation like that without blinking. It gives the finger to those who have been turning down Apple’s overtures and will present them with real competition in the future. If Apple does manage to finance a blockbuster series, it will generate income for a long time into the future.
If content is exclusive to the ATV they will have easily cut off a potential audience that either is not interested in adding an ATV box and/or can’t afford one.
It wouldn’t have to always remain exclusive. They could keep it exclusive initially and subsequently offer it for distribution or broadcast elsewhere.
If they finance a very successful franchise, there is also a lot of potential for licensing rights for merchandise like tee shirts, toys and other products. Owning the rights of a major success can be quite a gold mine. The tricky part is coming up with a major success, but a billion dollar investment could certainly improve Apple’s chances of getting there.