Movies

Apple has made splashy bets in Hollywood. Are they paying off?

BBG News

In the debut of “The Studio” on Apple TV+, Martin Scorsese, an Oscar-winning filmmaker, pitches his script to Continental Studios. However, after some time, the studio head portrayed by Seth Rogen informs him that the Jonestown-themed project is no longer in production.

Instead, the company is fast-tracking a soulless brand-based cash grab: a Kool-Aid movie.

In my own words, I’d say, “Simply return my film to me so I can directly offer it to Apple, as I should have done from the start. My current state is one of desperation.” This preserves the original sentiment while making it more conversational and in first-person perspective.

The line essentially implies that Apple TV+, the streaming platform by the innovative tech company Apple Inc., is marketed as a fertile ground where filmmakers can pitch and realize daring, unique concepts.

2019 saw the debut of a service that made headlines at a grand launch event alongside Oprah Winfrey and Steven Spielberg. This platform gained popularity through hit comedy series such as “Ted Lasso” and the critically acclaimed film “CODA,” which won the Best Picture award at the 2022 Academy Awards.

As a devoted follower of Apple TV+, I’ve often pondered about the sincerity of the company’s intentions in Hollywood. Was it destined to be a major powerhouse or merely another flashy, financially deep yet transient player? For quite some time, the whispers of job uncertainty surrounding Jamie Erlicht and Zack Van Amburg, the heads of Apple TV+, have persisted.

Recently, its endeavors have gained more attention due to a series of critical acclaim with programs like “Severance,” “The Studio,” and “Your Friends & Neighbors.” In a call with investors on Thursday, Apple’s CEO, Tim Cook, declared that Apple TV+ is now an essential viewing spot and saw record viewership during the last quarter.

Previously, some people likened it to HBO, as it was known for its eagerness to invest heavily in top-tier actors and creative minds, before the changes brought about by Warner Bros. Discovery started causing reductions.

According to Stephen Galloway, dean of Chapman University’s Dodge College of Film and Media Arts, it has excelled at finding its unique place in the market, and the quality of its work is exceptional. The issue is whether this niche is large enough to cover the costs associated with it?

As a dedicated movie enthusiast, I’ve noticed that Apple TV+’s subscriber base is relatively smaller compared to giants like Netflix. The reason? It simply doesn’t have the extensive, time-honored libraries that powerhouses such as Disney or Max (Warner Bros. Discovery) boast. These deep, established collections seem to keep customers locked in month after month, preventing them from jumping ship to another service. Don’t get me wrong, Apple TV+ does offer some great shows and films, but when it comes to sheer volume and diversity, it trails behind its competitors.

Critics question the effectiveness of focusing on quality rather than quantity in terms of Apple TV+’s subscriber base. Daniel Ives, managing director at Wedbush Securities, believes that the service currently has approximately 57 million subscribers, a number he deemed “disappointing.” Wall Street initially anticipated seeing at least 100 million or more subscribers by this point, according to Ives’ statement.

Apple constructed a grand estate (mansion), yet they seem to lack sufficient furnishings for it, which presents an issue regarding the quality of content on Apple TV+, according to Ives.

As a cinephile, I’ve been following the news, and according to reports from tech and business news site, The Information, it seems Apple TV+’s annual losses are reaching an astounding $1 billion. This strategy of theirs has left many competitors baffled, making me wonder about their long-term plans.

In an interview with Variety in March, Netflix co-CEO Ted Sarandos admitted that he doesn’t fully grasp their strategy as it seems more like a marketing ploy to him, but acknowledged that they are exceptionally intelligent individuals who might be seeing something that we’re missing.

Apple declined to comment.

It’s been observed that it often takes quite some time before streaming platforms start making a profit. For instance, NBCUniversal’s Peacock is currently operating at a loss.

Lately, investment groups have been urging streaming service providers to boost profits due to increasing competition within the field. With Netflix being crowned the champion in this competitive market, there’s apprehension among industry insiders as to how many platforms will be able to thrive independently.

According to sources within the company, Apple takes a unique approach to entertainment, differing significantly from the methods used by its more conventional studio counterparts.

Apple TV+ is simply one aspect of a broader plan by the company to expand their subscription-based services, led by Eddy Cue, encompassing offerings like Apple Music, iCloud storage, and Apple News, along with other choices.

In the previous financial year, a quarter of Apple’s total revenue – amounting to $391 billion – came from service-related sales. Notably, the iPhone continues to be Apple’s primary source of income, accounting for about half (51%) of their total earnings during that same period.

The company announced that it surpassed its previous service revenue record by $26.6 billion in the last quarter, representing a 12% increase compared to the same period last year.

According to Alejandro Rojas, Vice President of Applied Analytics at Parrot Analytics, Apple TV+ is “a smaller part” of your total offerings. The aim is to enhance the overall brand experience, but not by requiring an excessive amount of resources or investment.

Business

Tariffs imposed by the Trump administration could cause substantial harm to tech firms based in Silicon Valley, such as Apple, that carry out their manufacturing processes in China, Vietnam, and India.

Apple TV+’s programming strategy leans towards attractive talent, often focusing on productions featuring well-known actors.

One of its initial significant investments was the series “The Morning Show,” starring Jennifer Aniston, Reese Witherspoon, and Steve Carell. The show “Your Friends & Neighbors” features Jon Hamm from “Mad Men.” In February, their survival drama film “The Gorge” had Miles Teller and Anya Taylor-Joy in leading roles.

This summer, one of Apple’s significant cinematic debuts is set to take place with the Formula 1 film “F1,” starring Brad Pitt. Scheduled for release in June, it will be shown not only in traditional theaters but also on Imax screens. Warner Bros. is responsible for the theatrical distribution of this high-budget production, which was directed by Joseph Kosinski, known for directing “Top Gun: Maverick.

Paul Dergarabedian, a senior media analyst at Comscore, anticipates that “F1” might achieve the same success as “Top Gun: Maverick” on a racetrack. Previously, some of Apple’s movies directed by renowned filmmakers and featuring big-name stars, such as “Fly Me to the Moon” and “Argylle”, did not fare well at cinemas.

According to Dergarabedian, this movie is a significant one for Apple. He believes they’ve chosen an ideal project to showcase their skill in filmmaking and strengthen their connections with filmmakers.

Hollywood Inc.

On Tuesday, Apple announced packages for their assortment of services such as Apple Music and Apple TV+. Experts believe that these bundles aim to increase subscription numbers.

Creatives who have collaborated with Apple often remark on their unique, individual approach to nurturing talent.

Becky Clements, president of Tomorrow Studios, expressed her continual gratitude towards Apple for taking the chance to produce “Physical,” an original series featuring Rose Byrne as a 1980s housewife battling an eating disorder, who discovers resilience through aerobics.

Clements stated that it’s quite challenging to create something unique, especially when it comes to the competitive market.”

“According to Clements, making an original piece can be tough in a market full of competition.

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Clements praised Apple for providing backing to the filmmakers and refraining from excessive control over the production, as it tackled challenging subject matter.

Ben Silverman, an executive producer for the upcoming Apple TV+ series “Stick,” featuring Owen Wilson, revealed that they could travel to North Carolina to film due to the show’s generous budget. This location happened to be where golf commentators Trevor Immelman and Jim Nantz were stationed during the PGA Tour.

Silverman, the chairman and co-CEO of Propagate Content in Los Angeles, stated that many current platforms are generally supportive of creators, but they might not be able to dive as deeply into individual projects as Apple can due to their smaller project count.

Television

As a fervent admirer, I must express that unlike some streaming platforms, Apple TV+’s collection doesn’t boast an extensive library of classic films and series that have captured our hearts over the years. However, the tech titan confidently banks on its original programming to propel it towards “wild success.

Not all creatives have been happy with Apple.

Last year’s Brad Pitt and George Clooney action-comedy film “Wolf” left viewers perplexed as it opted for a brief, selective theater screening rather than the usual broad release.

director Jon Watts explained to Deadline that he chose not to proceed with a sequel due to Apple’s unexpected change of plans at the last moment, and also because Apple disregarded his request for confidentiality regarding the project’s development. So far, Apple has remained silent on the issue.

Similar to many other streaming platforms, Apple TV+ has adapted its services over time to boost earnings, minimize expenses, and attract more customers. Recently, Apple reduced the price of their streaming service for a limited period to $2.99 per month (normally $9.99). Additionally, last year, Apple struck a deal with Amazon to offer subscription sales on their platform.

During the month of February, Apple TV+ accounted for approximately 30% of its subscriptions through Amazon Channels, according to Brendan Brady, a strategist at research firm Antenna. This surge was primarily fueled by popular premieres such as the new season of “Severance” and “The Gorge”.

Brady stated that both the creation of engaging content and expanding their reach to a wider audience through distribution are key factors in their growth.

Apple’s global operations encounter broad economic difficulties, including the tariff disputes between the U.S. (Trump administration) and China, often referred to as the trade conflict.

Officials from the government have cautioned that taxes on phones manufactured in China, such as Apple’s iPhone, may be imposed soon. Since a significant portion of these devices are made in China, this could negatively impact Apple. Potential increased costs for the company might eventually affect other sectors too, like Apple TV+, according to analysts.

As a discerning film critic, I must admit that while Apple’s initial subscriber numbers may have stirred some excitement, it would be premature to pass definitive judgment on its success. Instead, I find myself confidently betting on this venture’s potential for long-term triumph.

Silverman stated, “Investing early and for the long haul is key. As someone who’s naturally entrepreneurial, I aim to jump on board early with these emerging platforms and collaborations, with hopes of establishing a prime position.

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2025-05-04 13:32

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