Apple plans to give away original content for free to device owners as part of new digital TV strategy

“Apple is preparing a new digital video service that will marry original content and subscription services from legacy media companies, according to people familiar with the matter,” Alex Sherman has just reported for CNBC. “Owners of Apple devices, such as the iPhone, iPad and Apple TV will find the still-in-the-works service in the pre-installed ‘TV’ application, said the people, who asked not to be named because the details of the project are private.”

“The product will include Apple-owned content, which will be free to Apple device owners, and subscription ‘channels,’ which will allow customers to sign up for online-only services, such as those from HBO and Starz,” Sherman reports. “Apple plans to debut the revamped app early next year, the people said.”

“Customers will be able to access all of their content from within the TV app so they won’t need to download individual apps from multiple media providers,” Sherman reports. “Apple is spending about $1 billion on original content this year, targeting “PG-rated” shows that appeal to wide audiences and won’t get the company in trouble by making them available for free to owners of all devices, said the people. Apple is also looking for ‘tent pole’ franchises that could serve as linchpins to a paid Netflix-like subscription service down the road, two of the people said.”

The Wall Street Journal reported last month Apple has about 24 original shows in production and development,” Sherman reports. “Peter Stern, who joined Apple in 2016, has been tasked with striking contracts with media companies to put together the service, said people familiar with the matter. Stern, who reports to [Apple SVP Eddy] Cue, was Time Warner Cable’s chief strategy officer”

Read more in the full article here.

MacDailyNews Take: Spend $1 billion to give it all way? For some perspective, remember that Apple is said to have spent well over 3X that in fraudulent iPhone repairs on China in 2013. $1 billion is a drop in the bucket to Apple. $10 billion is. When buying a Mac, iPhone, iPad, Apple TV, etc. gets you access to FREE exclusive hit series and other content, Apple’s so-called “competitors” will be deer in the headlights, with nothing to offer but their typical Apple knockoff products. They’ll then be forced to sign deals with other outlets to offer free NON-EXCLUSIVE content that can be found elsewhere.

Apple devices sales will increase, meaning the install base will increase, meaning Apple Services will increase and the cost of exclusive original content will bar the low-margin fragmandroid bottom-of-the-barrel scrapers from ever following. Hey Haw!

Smart move to make it a nice little perk of owning an Apple device. – MacDailyNews, October 10, 2018

TV app? — MacDailyNews, is response to the statement “Apple has been silent about how people will ever watch any of its shows,” 8:43 am, October 10, 2018

I’d like to create an integrated television set that is completely easy to use. It would be seamlessly synced with all of your devices and with iCloud. It will have the simplest user interface you could imagine. I finally cracked it.Steve Jobs

SEE ALSO:
Netflix has no idea what Apple is doing with $1 billion worth of shows – October 10, 2018
Apple to debut Carpool Karaoke season 2 for free through TV app – October 9, 2018

18 Comments

    1. I tend to agree. Considering how measly they are with iCloud space I find it difficult to believe that such a give away will be long lasting. They need it to compete for some years but eventually unless there is some unknown/unexpected magic bullet of indirect profit we can only speculate upon presently, this will become entangled into a wider profit making affair where at best its costs will be obscured as the scale of the service widens.

  1. “The product will include Apple-owned content, which will be free to Apple device owners, and subscription ‘channels,’ which will allow customers to sign up for online-only services, such as those from HBO…”

    That is a bold and brilliant business model. LOVE it. Make and offer some killer loss-leader content, and make a cut of the audience you’re building for other vendors. These networks will go where the audience is. And the audience will be buying and watching television on Apple devices.

    1. A blanket Apple channel, allowing to transparently buy/rent content originating with NetFlix and others should have been available months, not a decade, after the AppleTV came out.
      We all remember how SJ mentioned, when talking about AppleTV replacing DVDs and the use of multiple remotes/settopBoxes: ‘It will have the simplest user interface you could imagine. I finally cracked it.’
      The current different apps on AppleTV, each giving access to their own content provider’s subscription, are a PITN, and a far cry of what SJ intended to do.
      Just hoping the current Apple mgmt sees the light soon.

    1. Considering that Apple is producing these shows in-house, I can’t see why they would be US-only. It isn’t like they have to go through layers of licensing deals to distribute it.

  2. Something given away for free is typically worth that much.

    This reeks of a teaser to force future subscription shackles. When that comes to pass, we will see Cook for what he is, a corporatist more intent on monthly fees than product excellence. So much for Apple aiding people to cut the cord or having truly personal computing. Apple wants to be the next mainframe Big Brother. I foresee Apple’s media play will be another distraction and money drain. Comcast owns both pipes and studios. Apple owns carpool karaoke and has a plastic box with a horrid glass remote. Which one is going to have bigger sway in Hollywood?

  3. I would not want Apple to be the sole “Gatekeeper” of new media and content, restricting it to PG-13. Competition and variety is good for people and good for the entertainment industry.

    1. Didn’t get the impression that all the content would be PG, just the Apple produced content. That seems ok to me. It’s ok for Apple to protect their brand. There is lots of interesting PG content like Nova or Nature or various thoughtful sci fi movies and other dramas.

      I’m ok with R rated content, but most of my favorite movies were not. A few are The Day the Earth Stood Still (original), Casablanca, Seven Days in May, 2001, To Have and Have Not, Dr. Strangelove, and every Laurel and Hardy movie.

      1. Apple is trying to be more G-Rated Disney like from yesteryear but even Disney came up with “Touchstone Films” as a way to produce more mature content without hurting the Disney brand and creating outrage. Apple shouldn’t be too concerned with staying a “safe” middle pablum ground on dynamic & more mature adult content. But neither should they have adult porn either. It will be interesting how this all pans out. I welcome more producers of content and the jobs and entertainment brought as a result.

    2. The will never be a “gatekeeper.” They aren’t now. They’ve only said that the content that Apple wants to produce is PG-13. HBO is already a channel on Apple TV and they certainly aren’t PG-13.

  4. MDN you’re describing monopolistic business practices, use one part of your business to subsidize another part of your business to drive competitors out of the market.

    The federal government will have the last word on this…

    1. Well, Google has done this with Android OS and the Feds have nothing to say about it. I’m sure Android OS’s 85% market share was driven by Google giving away Android OS for free to smartphone manufacturers while making money from search engine ad revenue and collecting user’s personal data. Am I wrong? 85% is darn sure enough to drive competitors out of business.

      Wall Street absolutely loves Google for turning user data into stacks of gold. The Feds certainly don’t give a damn. Apparently, the Feds have given Google their blessing.

    2. If Apple TV or any Apple device were a monopoly you’d be onto something. But Apple has no mass market share of any market. More. Voices than ever before god devices. So your argument falls apart.

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