Buried underneath the infinite pile of news articles, op-eds, and memes that originated from a slap broadcast around the world was the clearest example of the sea change in Hollywood wrought by technology companies: Apple TV+ won Best Picture for CODA, making it the first film distributed by a streaming service to ever win the Award.
CODA, a comedy-drama about an aspiring singer who is the only hearing person in her family, was acquired for distribution by Apple TV+ for $25 million and brought in only $1.3 million at the box office. However, the financial loss is just a drop in the ocean for the world’s most valuable company. Not only does it have the reigning Best Picture Winner, but Apple TV+ also produced Ted Lasso, which won the Emmy Award for Outstanding Comedy Series just six months earlier.
Apple TV+ has demonstrated its ability to create content of the highest quality by following a similar trajectory to that of Amazon Prime Video. Both have created long-term production deals with major talents, leveraged their core businesses to promote content (and vice versa), and had the creative bandwidth to produce risky but award-worthy movies and television that wouldn’t have seen the light of day at the more budget-conscious legacy studios.
Standing atop Tinseltown (at least until next year’s Oscars — if anyone is still watching), Apple TV+ has received critical acclaim but lags behind its competitors in terms of user base, with about 20 million paying subscribers; for comparison, Netflix dominates this competition with 221 million subscribers. Apple TV+ has also taken a more restrained approach to spending on content (with an annual content budget of $6.5 billion) compared to Netflix ($17 billion) and Amazon ($9 billion).
Since its launch in November of 2019, Apple TV+ has focused on quality over quantity. Unlike the other services waging a costly streaming war, it prioritizes producing original content over quickly building a large content library to attract viewers. This strategy has been puzzling to many in Hollywood, especially the studio executives and producers who could only dream of having access to the kind of capital that Apple TV+ does. The streamer also takes a minimal approach to marketing, making its Oscar win for CODA all the more impressive. So why is it that Apple TV+ is taking such a slow approach to growing their content library, and where can they go from here?
Subscriptions to Apple TV+ cost $4.99 per month and are included free for 3 months to buyers of new Apple products (down from the initial one year offering). For the first couple years of its existence, the streaming service was not accessible on televisions that operated on Android OS. Considering the cash at its disposal, Apple can play the long game of creating their own catalog of high-quality, original content. This could enhance the experiences for potential buyers of their products, effectively maintaining the service as a loss leader. Considering the current smaller content catalog, this could seem insignificant; however, the impact could be substantial eventually. This approach is similar to the company’s approach to making Apple Music available on other platforms. The company cannot afford to allow users’ to move onto other services completely, making it easy for the users to jump between platforms making use of these other services.
What do you think of Apple TV’s long-term prospects?
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