“Apple Inc. is very much still in the investment phase when it comes to original-video content, but one analyst predicts these efforts could turn into a profitable endeavor in just a few years,” Emily Bary writes for MarketWatch.
“Amit Daryanani of RBC Capital Markets wrote Monday that a combination of Apple’s original-video efforts and its Apple Music service could lead to between $10 billion and $12 billion in annual revenue three years from now. Music and video could also contribute between 25 cents and 75 cents to the company’s earnings per share, he added,” Bary writes. “Analysts currently project that Apple will post $13.72 a share in earnings in its 2021 fiscal year, according to FactSet.”
“Daryanani’s model assumes that the company is able to amass 100 million or more paying Apple Music subscribers within three years and that the company continues to price the service at $9.99 per month,” Bary writes. “Though Daryanani doesn’t factor in a price increase, he contends that Apple might have the leverage to do so, given that Spotify and Hulu charge $12.99 for a package that includes both music and video.”
Read more in the full article here.
MacDailyNews Take: Why would Apple roll TV and feature-length productions into “Apple Music?” It’d be horribly misnamed, à la iTunes Store itself (which has long sold TV shows and movies and should have been renamed many years ago). So, why not have an “Apple TV” service to go along with “Apple Music” and sell each separately with the option bundle both at a better price? For example, $9.9/mo. each or $14.99/mo. for both?
[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]
I wonder how much Apple could make from biofuels, or women’s lingerie, or any of the thousands of other things that have nothing to do with computers.
Getting into content production puts Apple in direct competition with Disney, Sony (Columbia), AT&T (Warner), Comcast (NBC/Universal), CBS/Paramount, Fox, Lionsgate, MGM/UA and many others.
If they get into distribution in a serious way they will be bucking many of the same plus Google, Amazon and others.
Both are tough businesses and Apple has a long track record of playing at stuff rather than sticking it out for the long haul. There is a limited amount of talent on the writing side, which is the most important part of the whole business. There are plenty of actors, directors, cinematographers, etc., but only a very limited number of people who can create original content and write. A lot of companies are throwing money around chasing a finite number of people and past success is no guarantee of future performance.
I think Apple should stay out fo this line of business, but if they are going in they need to buy an existing player with people who know what they are doing. A great target would be CBS who owns the CBS TV network, a Cable Sports Channel, Showtime, the CBSN streaming news channel, the 10 Network in Australia, CNET, two Radio Networks and a half interest in the CW Network.
More importantly they have Les Moonves who has run a Studio (Warner) and a TV network (CBS). Mr Moonves knows the business, has a good gut feel for the market and has a long established track record and would be a great fit for whatever combination of assets Apple want to set up.
No content is low margin crap only Eddie Cue could love it.
are part of AAPL’s biz plans bylines…going way beyond Mac Pro/mini.
We all recall what a powerhouse electronics manufacturer Sony used to be. Once an innovator, now a has-been.
Why exactly would anyone want Apple to follow Sony’s footsteps into irrelevance?
No one remembers Sony fall.
Businesses, Powerful Rulers/Empires, Universities never have an “eternal” run and few notice/admit the downturn…and fewer still have the willingness or ability to turn the ship.