“The golden age of TV programming is heading for a grisly finale. Netflix, Amazon, Apple and Hulu are on course to boost their spending on new shows and movies at a faster clip than the growth of the overall video-streaming market,” Jennifer Saba writes for Reuters. “Consolidation among traditional media groups is only adding to the frenzy. Something will have to give.”
“Netflix set off the arms race. In 2017, the company founded by Reed Hastings directed $6 billion toward licensing and original series like ‘Stranger Things.’ In 2018, executives plan to earmark up to $8 billion for content, a 33 percent increase year-over-year,” Saba writes. “Across the industry, the number of original TV shows has more than doubled to 455 between 2010 and 2016, according to research firm MoffettNathanson.”
“Along with Amazon, Hulu and Apple, the total spending on content by the big four media upstarts in 2018 will mushroom some 30 percent year-over-year to $18 billion, according to a Breakingviews forecast based on analysts’ estimates,” Saba writes. “The tangle of options in streaming services and programming chasing a finite number of subscribers suggests the industry is entering into an unsustainable investment battle – and a potential price war may follow as players try to rake in extra market share… Competitors Apple and Amazon could easily outmatch Netflix on content budgets if they decided to abandon financial reason.”
Read more in the full article here.
MacDailyNews Take: Those who can wrap their heads around Apple’s massive cash mountain and the company’s unparalleled ability to generate cash can clearly see who the winner will be. The most talented producers, writers, directors, editors, actors, etc. are attracted to exactly what Apple has and makes in vast abundance: Cash. The king.
Like bears to honey, it’s happening already.
There will be a market for content that Apple will not want to put their name on. The also-rans that survive will do so by becoming the “skinamax” of the content streamers or by narrowly specializing and sharply focusing their branding.
Apple should use their cash pile to create some much needed leverage to finally get their Apple TV subscription bundle(s) up and running. — MacDailyNews, January 13, 2016
SEE ALSO:
Three more Amazon Studios executives move to Apple – December 26, 2017
Apple orders space drama series from ‘Battlestar Galactica’ producer Ronald D. Moore – December 15, 2017
Apple gives Jennifer Aniston-Reese Witherspoon series a 2-season order, confirms Spielberg’s ‘Amazing Stories’ reboot – November 9, 2017
Apple outbids Netflix for show starring Jennifer Aniston and Reese Witherspoon – November 8, 2017
Apple eyes iconic studio as base for Hollywood production push; vying with Netflix for high-profile Jennifer Aniston drama – September 1, 2017
The magic and misdirection of Apple’s streaming strategy – August 18, 2017
Apple wants to spend $1 billion on 10 original TV shows over the next year – August 16, 2017
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
What is happening right now is a lot of money is chasing a relatively small pool of talent.
Prediction: not a lot of great new shows, but a lot of people in Hollywood and London will be making bank on the rubes (ex-Eddie Cue) with more money than sense.
With apples history of underpaying their vendors to the point of bankruptcy, strong arm negotiation tactics and take it or leave it approach, I doubt that anyone will get rich of of that money pile making content. At the very least, Apple will not compete on that level, who’s going to pay talent more.
You win Europe with the premiership and la ligament rights – the us with American football
Shows will follow
I think Netflix, Amazon, Apple and (to a lesser extent) Hulu will do just fine. I think consumer access to virtually unlimited “channels” via streaming is likely to kill off one or more of the traditional broadcast networks first.
For decades, the networks made fortunes based on scarce allocation of broadcast licenses. Producing good television shows was far less important than selling soap. Now that scarcity is a thing of the past, I don’t think they can compete for the eyeballs that are needed to sell commercials.
I think it is more likely the large networks due to being the producers of content will survive via selling display licenses to the streaming outlets like Amazon, Hulu, Netflix, Apple while local affiliates will take the brunt of the financial ‘damage’ by being unable to support continued operation via the advertising they would normally sell.
MDN, creativity is also king. A lot depends on how much creative freedom and risk apple allows the producers and show runners. If it’s anything akin to Disney / New-lucasfilm handling of Star Wars, no decent director writer etc. is going to want anything to do with it because it’s all managed by committee.
Fox Networks bet on risky shows like “The Simpsons” and “Married with Children” that the big three wouldn’t touch to become the 4th largest network in record time. Maybe it would pay for Apple to poach a few people from that group.
I wonder if Apple will make the TV shows and/or movies they are working on exclusive to Apple devices or to a subscription service for iOS and Android devices. I wonder which would be more profitable. Most Apple services that make Apple the most money are iOS exclusive (iCloud storage, AppleCare, App Store etc.). I wonder if the content will be good enough/large enough to drive people to Apple products.
Considering that there are so many successful alternatives for video content outside of Apple it may be difficult for them to compete by making such content exclusive to Apple devices. With TVs still being the dominant form of consuming video content longer than 20 min if Apple makes their video content exclusive to their ecosystem their audience volume will be limited largely by how many have Apple TV devices connected to their set.