Apple is reassessing its approach to content spending on Apple TV+, having invested a staggering $20 billion in original programming, as reported by Bloomberg. The company’s executives, including Eddy Cue, are engaging in discussions with studio heads Zack Van Amburg and Jamie Erlicht to cut back on budgets and move away from its reputation as an industry heavyweight spender.
Historically, Apple has made significant investments in high-profile projects, such as the $250 million expenditure on the miniseries “Masters of Air,” which, despite its substantial budget, failed to resonate with audiences. Additionally, the platform has invested over $500 million in films from notable directors like Martin Scorsese, Ridley Scott, and Matthew Vaughn. However, this massive financial outlay has not translated into viewer engagement, as Apple TV+ holds only 0.2% of TV viewership in the U.S., barely scratching the surface compared to Netflix, which averages more views in a single day than Apple does in an entire month.
While Apple is not overly concerned about the underperformance of its streaming service—since it is not central to the company’s core business—there are indications that the era of unrestricted spending may soon come to an end. This shift is further emphasized by the company’s cautious approach to renewing shows for a third season.
Moreover, Apple TV+ stands out as the last major streaming platform without an ad-supported tier. However, this is poised to change following the recent hiring of Joseph Cady, a former ad executive from NBCUniversal, suggesting a possible pivot towards monetizing the service through advertisements.
Overall, this strategic shift could signal a more sustainable and focused future for Apple TV+, potentially leading to a lineup of more engaging content that resonates with viewers. By recalibrating its spending and exploring new revenue models, Apple may finally find its niche in the competitive streaming landscape.
In summary, Apple is likely addressing its over-expenditure in original programming and looking towards innovative strategies to increase Apple TV+’s appeal and profitability, which could result in a more refined content slate moving forward.