Given Netflix’s success in the area, it would be fair to say that most people are excited about the possibility that Apple may be entering the original programming arena.
However, according to a new report citing industry insiders, Apple could wait quite a while before launching into its latest venture.
Jessica Lessin of The Information says Apple is using Apple Music — with its Beats 1 original content — to test the original content subscription model. The reason for this is that getting a second sale (i.e. getting people to sign up for an Apple TV subscription) is considerably easier after making a first sale (Apple Music).
A previous report suggested that 11 million people have already signed up for Apple Music, although we’ve yet to see what percentage of those will hang around once the free trial period comes to a close.
Lessin says some people in the industry think Apple needs to hit at least 20 million or 30 million subs before it is viable for the company to enter the TV and movie content-creation business.
I called Apple’s move into content creation before the news originally broke — noting that a number of the new videos debuted on Apple Music have been produced by Apple in-house, while more and more of its ads are created internally too.
The 30 million subscribers level certainly seems attainable in light of all the great features we’re hearing about for the upcoming Apple TV refresh. With that being said, if this is an area Apple sees as valuable, there’s no reason why it couldn’t jump into content creation sooner than that.
Apple has such deep pockets that shelling out a few million as a loss leader to get people talking would barely register as a blip on Cupertino’s radar.
And, who knows, if Apple stumbles on the next Game of Thrones or The Walking Dead, it would be a valuable bargaining chip when it comes to cutting future content deals in Hollywood and beyond.
Source: The Information
