Even Apple can struggle every now and then. The tech giant launched Apple TV+ back in November of last year, its foray into the streaming video-on-demand competition. If you already used the Apple TV app, you could pony up $4.99 to get access to Apple’s slate of original shows, including The Morning Show, See, Dickinson, and For All Mankind.
Apple spent $6 billion for original television shows for the service, ending up with the launch slate above and future projects from industry veterans like Oprah Winfrey, Steven Spielberg, and M. Night Shyamalan. That seems like an absurd amount of money, but it’s in line with existing rivals: Netflix spent $10–15 billion in 2019 for content, according to analysts, and Disney spent around $16.4 billion last year for shows and films across streaming, TV, and theatrical. WarnerMedia threw out $11 billion to get HBO Max up-and-running.
The problem was that no one seemingly wanted to watch any of Apple TV+ shows. The company seemingly expected Apple TV+ to work like Apple’s hardware: if you build it, they will come. Instead, audiences looked Apple’s slate of shows, watched a few episodes of The Morning Show, and walked away. There was no buzz for many of the shows, no social media fanfare. And with the current COVID-19 coronavirus pandemic, Apple’s in the same place as many other studios, with no way to produce new content.
Apple thought the shows it had were going to be enough, but the truth is people subscribe for a depth of content Apple TV+ simply doesn’t have. Disney+ relies on the extensive family-friendly back catalog of the House of the Mouse; HBO Max pulls together HBO, Warner Bros films, and Criterion/TCM classics into one place; and Netflix has been outspending everyone and greenlighting everything for years now. Even CBS All Access and NBCUniversal’s Peacock have reams of old, beloved television shows to fall back on. Apple has none of that.
The company is finally realizing that’s not a winning formula. A report from Bloomberg states that the service had 10 million folks sign up on launch day, but only 5 million have stuck around to watch shows since. As I said in my previous streaming service breakdown, Apple is starting from zero. And the lack of previous spending means most of the big guns — The Office, Friends, Seinfeld, etc — have already been spoken for. The deals are made, Apple’s behind the curve.
The Bloomberg story states that Apple is finally trying to get into the game now, aiming to build a strong back catalog of content. Where that content is going to come from is a bit of mystery. Apple has the money to buy pretty much anyone, with $207.6 billion cash on hand. That’s a good deal of money, and part of the reason that Apple buying Disney pops up in analyst memos every 6–8 months. (It’s probably not happening though.)
There are other places to look though. Sony Pictures’ content is largely unclaimed at the moment, since no one cares about Crackle. In fact, Sony just sold Tom Hanks’ Greyhound to Apple for $70 million. Lionsgate, owner of Starz and producer of several upcoming films like John Wick 4 and Chaos Walking, is a good partner to approach for licensing deals. The company just posted a quarterly loss of $44.9 million and could probably use the money. Sure, Starz has a deal with NBCUniversal’s Peacock as well, but money talks.
Apple essentially needs to pick up metaphorical rocks and see what shows still remain to acquire. Right now though, it’s up against the existing catalogs from Disney, WarnerMedia, ViacomCBS, and NBCUniversal. Or Netflix’ considerable head start in terms of original production and international licenses.
This feels like the result of some hubris. Just because you’re the mighty Apple doesn’t means audiences are going to subscribe to your service, something the company should’ve realized before launch, not after. Now it’s time to put that war chest to work and play catch-up.