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Apple Sets Aside '$1 Billion War Chest' for Hollywood Programming
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It is well known that the Premier League (English football/soccer to you Americans) right deal is up for tender next year for the 2019/20 season until 2022/23. I firmly expect Apple to be in the bidding, so too I expect Netflix, Amazon, and Google. I know a lot of Americans won't be fussed about this and will question why, however football (soccer) is the most popular sport in the world, and the English Premier League is the most watched league in the world. In fact people subscribing to Sky sports here in the UK in order to watch the Premier League actually subsidise non sporting channels as it makes that much money. This is where Apple needs to start, getting the UK and global domestic rights to the Premier League, getting sporting rights for American sports in the US-Canada (world wide rights for the super bowl), then take it from there to develop original content.
How do you know that Apple's intent is to compete with Netflix? So far, their interest in video projects is almost entirely oriented around the music industry and Apple Music.
Again, they're straying away from their core ... insanely designed technology that makes consuming art, literature, etc a joy and pleasure to use. Remember that phenomenal product called "Ping"? Here's what they need to do right not: fix iTunes (its a complete mess). Fix the Mac (don't lose your developers for any reason). Fix the ecosystem (bring back Wi-Fi support to make the home a seamless experience). Fix Apple TV (the remote is horrible. Plus, the software needs improvement). Fix video production software. Fix native Mac Apps. Fix iWatch. (make different styles) Bring back the iPod to focus more on music and to boost Apple Music. If you do these simple things, you will maintain a strong core while venturing into new technology sectors confidently.
The iPod would've been a Zune w/o the iTMS. The iPhone would've just been another smart phone w/o the App Store. Creating compelling software/services to help drive people to their hardware is Apple's MO and it's why the
TV is dead unless Apple creates original, streamable content.Speaking of the iPod...
Why would they make new iPods when iPods got pushed out of the market by smart phones? That's like saying Apple should bring back the QuickTake to try and wrestle the point-n-shoot camera market back from smart phones.
Video steaming is turning into an arms race, one that Apple would be wise not to compete blindly in. It's not a matter of who spends more on content, and I feel that Apple doesn't need to considering that Netflix is available on iOS anyways.
Apple's strategy in this area is very different from companies such as Netflix, where it's their bread and butter.
In short, Apple doesn't have to operate at the scale that Netflix does in order to compete with them.
The iPod would've been a Zune w/o the iTMS. The iPhone would've just been another smart phone w/o the App Store. Creating compelling software/services to help drive people to their hardware is Apple's MO and it's why the
Good observation but the analogy breaks down since AppleTV has an App Store. iPhone isn’t successful because Apple makes all of its apps. 3rd parties drive the App Store.
The idea of putting an App Store on AppleTV and most recently bringing those apps together in the TV App, was to encourage content creators to make content that they’d usually distribute through traditional cable channels, become available directly online in the form of an app.
But AppleTV is a funny product for Apple. Unlike everything else they make, it’s not the hardware that makes them money. It’s the subscription revenue. It’s a service driven profit item. But taking a 30% cut from apps is hurting their goal of attracting content creators to AppleTV and reducing that share will hurt the entire business case of having an AppleTV at all.
So yes, they need to start producing their own content and acquiring rights to exclusive shows. The end game here is definitely going to be creating an analogous to AppleMusic but for video content. Apple’s own Netflix. Apple is hitting a wall on how much revenue it can generate in hardware and the only place they can continue to grow is in services.
Tim Cook said he’d have more to say about the AppleTV in the Fall. It might be that they’ll finally launch their tv service this year.
I'm guessing, they're spending 'only' $1B, because unlike with apps and music, this will be something they provide for free (at least initially) and use to bring in more users. If I were them, I'd spend at least some of that money on a news agency that, for cord cutters, could become their go-to source.
As for the rest, why is everyone assuming all the tv shows they are looking to produce are expensive American shows? Mix in some Indian, Korean, and Spanish language soap operas, and you've got more than enough money for five moderately expensive American type shows, a news agency, and four international shows.
As for the rest, why is everyone assuming all the tv shows they are looking to produce are expensive American shows? Mix in some Indian, Korean, and Spanish language soap operas, and you've got more than enough money for five moderately expensive American type shows, a news agency, and four international shows.
I agree that the
TV is in a funky spot. It's original purpose, to easily get streaming/digital content from the Internet to your living room TV, has been matched and/or surpassed on both the hardware and software sides. Both the iTMS and the App Store were the 'killer app' for the iPod and iPhone respectively because they helped bring you into an ecosystem experience that you couldn't get with other products, but what's compelling about Netflix on an TV vs Netflix on a smartTV, Roku, Xbox, etc? Is buying a movie on Amazon and watching it on my TV, tablet, computer or phone a drastically different experience than buying a movie on iTMS and watching it on my TV, tablet, computer or phone? Not really (and Amazon is cross platform where as Apple is not).The 'killer app' for streaming channels, broadcast channels, network TV channels, etc., is original programing. Hypothetically, if Apple produces content on par with Game of Thrones, and the only way to watch it on a TV is if you have an
TV*, the units will be flying off the shelves. The *yes, you could hook up your laptop via HDMI but that is a cumbersome solution for the vast majority of people.
A mere third of what was claimed (by a single analyst) they would make with Google search. ftfy
On topic: $1 billion is a decent start, but Apple is going to have to step up it's game eventually. Netflix is said to be spending $6 on content this year.
But Netflix is also investing in a ton of returning shows. Every subsequent season of a series has a larger budget than the previous season to accommodate more ambitious scrips, actor raises, etc. You can't really use Netflix or Amazon as a benchmark relative to a startup content creator.
[doublepost=1503087167][/doublepost]It's less about how much money is invested and more about finding show runners you believe in and giving them the trust and support to follow through on their vision. I was at a panel with the Duffers last night and you'd be amazed, first at the number of networks that passed on Stranger Things, but moreso at the volume of executives who wanted to rewrite the series to suit their own tastes. (Eg. one network wanted the entire show to be about the sheriff, not the kids. 'Cause that's magical.) The problem with most entertainment executives is that they have no taste or creative instincts and frequently have no idea how the series they produce even work. Unfortunately, they hold the purse strings, which means they make the decisions. Apple's already shown signs of failing this test with their first two entries — they opted for tech-centric shows, not because that's what the audience necessarily wanted, but because they're a tech company so that is likely what their own decision makers were interested in. There is plenty of room in the modern landscape for digital content providers, particularly ones who are able to write their own checks. But if Apple wants to succeed, they'll do what what they, of all companies, should know best and let the creative people make the creative decisions.
Its common knowledge that they have been trying to put together a TV streaming service for Apple TV. I would be very surprised if they spent billions on original content to give away for free on Apple Music.
I agree in general, but I'm less concerned w/Apple making a tech show, and more concerned that all the announced projects to date sound like they also function as another way for Apple to advertise its own products. Original programing that keeps tying back into Apple's goods and services just going to grate on people's nerves and fail.
The iPod would've been a Zune w/o the iTMS. The iPhone would've just been another smart phone w/o the App Store. Creating compelling software/services to help drive people to their hardware is Apple's MO and it's why the
Speaking of the iPod...
Why would they make new iPods when iPods got pushed out of the market by smart phones? That's like saying Apple should bring back the QuickTake to try and wrestle the point-n-shoot camera market back from smart phones.
Hogwash ... you're mixing up content with UI/UX. Apple didn't need to create music to change the music industry. They didn't need to change reading, web surfing, etc. to blow up the tablet market. In both of these cases, they made the UI/UX insanely easy and enjoyable for the consumer.
Apple didn't need to create original music in 2003 in order to be successful because Apple didn't need to create original music in 2003 in order to be successful. The business model for success was different back then, technology was different back then, etc.,. In 2017, where all the growth in music and tv/film distribution is in streaming services (not digital sales) Apple needs to create original content in order to compete with Netflix, Amazon, Hulu, HBO, Starz, the UFC, WWE, MLB, CBS, AMC, etc,. It's not like all these companies just started making their own content and/or launching their own streaming services because they like pissing money away.
If you only license TV shows/movies from others then it is difficult to differentiate yourself from the competition (which also licenses nearly all the same content), your catalog will always be in flux because the contracts are usually only for 4 or 5 years, and you are 100% at the mercy of other companies in order to get the content you need. For example, in 2010 Netflix spent about $180 million licensing content. In 2012 that number had ballooned to nearly $2 billion as content owners realized that streaming was actually taking off. Makes the $6 billion Netflix is spending this year on original content seem like a great investment since it gives them something unique that won't disappear from their catalog, won't cost them money outside of the initial production, and will allow them to monetize it in various ways (selling DVDs, digital downloads, apparel, etc.,).
What Apple did in 2003 w/the iPod/iTMS was unique. What Apple did in 2007 with the
TV/iTMS was unique. But they let technology and the market place pass them by.As with much if not all Apple does.... too little too late. Apple wants to make money with everything it does. Sometimes you have to invest before harvesting. In my eyes they've lost the tv-businesses when they introduced the AppleTV 4. Asking premium (again) for something competitors sell for a fraction of the price. Their greediness is their biggest enemy and will bite back.
I don't see Apple coming up with a 'House of cards' or 'Game of thrones'. 1 billion? Isn't that the amount of money some movies cost to develop?
I don't see Apple coming up with a 'House of cards' or 'Game of thrones'. 1 billion? Isn't that the amount of money some movies cost to develop?
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Apple didn't need to create original music in 2003 in order to be successful because Apple didn't need to create original music in 2003 in order to be successful. The business model for success was different back then, technology was different back then, etc.,. In 2017, where all the growth in music and tv/film distribution is in streaming services (not digital sales) Apple needs to create original content in order to compete with Netflix, Amazon, Hulu, HBO, Starz, the UFC, WWE, MLB, CBS, AMC, etc,. It's not like all these companies just started making their own content and/or launching their own streaming services because they like pissing money away.
If you only license TV shows/movies from others then it is difficult to differentiate yourself from the competition (which also licenses nearly all the same content), your catalog will always be in flux because the contracts are usually only for 4 or 5 years, and you are 100% at the mercy of other companies in order to get the content you need. For example, in 2010 Netflix spent about $180 million licensing content. In 2012 that number had ballooned to nearly $2 billion as content owners realized that streaming was actually taking off. Makes the $6 billion Netflix is spending this year on original content seem like a great investment since it gives them something unique that won't disappear from their catalog, won't cost them money outside of the initial production, and will allow them to monetize it in various ways (selling DVDs, digital downloads, apparel, etc.,).
What Apple did in 2003 w/the iPod/iTMS was unique. What Apple did in 2007 with the
Great theory, but I totally disagree.
Cheers