Apple has become aware that it is overspending on original TV shows and movies that many viewers may not recognize.
The company is reportedly considering a new strategy for its streaming service, Apple TV+, after investing approximately $20 billion in original content, as detailed by Bloomberg.
Sources indicate that Apple executive Eddy Cue has been in discussions with studio heads Zack Van Amburg and Jamie Erlicht about cutting back on production budgets. The duo has apparently communicated the desire to change the platform’s image as the largest spender in the industry.
Apple has invested substantial amounts in productions, exemplified by a $250 million expenditure on the miniseries “Masters of Air,” which saw minimal audience engagement upon its release this year. Additionally, over $500 million has gone towards films from renowned directors such as Martin Scorsese, Ridley Scott, and Matthew Vaughn.
Despite this significant financial outlay, Apple TV+ captures only 0.2% of television viewership in the United States, garnering fewer views in a month than Netflix achieves in just one day. The platform has also faced challenges in growing its subscriber base.
Although Apple TV+ has encountered these obstacles, the tech giant is not overly concerned, as streaming does not constitute the core of its business model. However, the era of unrestricted spending appears to be ending, illustrated by hesitancy to renew series for third seasons, according to Bloomberg data.
Notably, Apple TV+ remains the only major streaming service without an advertisement-supported tier. This may soon change, as the company recently hired advertising executive Joseph Cady from NBCUniversal.