Apple recognizes that its spending on original content, including television shows and movies that may not have gained much public recognition, is becoming excessive. Reports indicate that the tech giant has invested a staggering $20 billion in developing content for its Apple TV+ platform.
According to a Bloomberg report, Apple executive Eddy Cue has been in discussions with studio heads Zack Van Amburg and Jamie Erlicht about finding ways to manage and reduce production budgets. The emphasis is on shifting away from its reputation as the streaming service with the largest expenditures.
One of Apple’s notable investments was the $250 million spent on the miniseries “Masters of Air,” which received a lukewarm reception upon its release this year. Additionally, the company has invested over $500 million for films from renowned directors such as Martin Scorsese, Ridley Scott, and Matthew Vaughn.
Despite these significant financial commitments, Apple TV+ currently holds only a 0.2% share of TV viewership in the United States. Its monthly viewing figures are considerably lower than what Netflix achieves in just 24 hours, and the platform has faced challenges in growing its subscriber base.
Interestingly, Apple does not seem overly concerned about the challenges facing Apple TV+, as streaming is not a primary focus of its overall business strategy. However, indications suggest that the era of limitless spending may be coming to an end. The company has hinted at its changing course by becoming increasingly hesitant to renew shows for third seasons.
Significantly, Apple TV+ is currently the only major streaming service without an advertising tier. However, this may soon change, especially with the recent hiring of Joseph Cady, an advertising executive who previously worked at NBCUniversal.
In summary, while Apple has made substantial investments in original content for Apple TV+, it is now recognizing the need to reassess its spending strategies as viewership numbers remain low. A shift towards managing budgets more efficiently could open up new opportunities for the platform to strengthen its offerings and improve its competitive positioning within the crowded streaming landscape.
This transition might lead to a more sustainable business model for Apple TV+, fostering innovative content creation strategies that resonate better with audiences.