Everything on Apple TV+ today was released in the past few months. But Apple is reportedly in talks to buy MGM, which would bring a catalogue of classic and modern movies to the iPhone maker’s streaming video service.
Two sources told CNBC that Apple and MGM have held “preliminary talks” about a possible acquisition.
However, Apple has competition — Netflix has also talked with this studio.
Apple and MGM: A match made in Hollywood
Analysts began urging Apple to buy a major movie studio even before its streaming video service was announced. They’ve suggested A24, Lionsgate and Sony Pictures, and even CBS/Viacom or Netflix. MGM also appeared on many lists.
This recommendation is based on growing the number of shows available through Apple TV+. A monthly subscription to this streaming service is $4.99, but that currently brings access to less than a dozen series and a handful of movies. Apple is adding more before the middle of this year, but its catalogue is tiny compared to what’s offered by rivals like Disney+ and Netflix.
MGM has a huge collection of intellectual property, from Gone with the Wind to the James Bond series to Hot Tub Time Machine. Adding it to Apple TV+ would significantly increase the value of a monthly subscription.
Apple can afford it
MGM is currently privately owned by a holding company that purchased it in 2005 out of bankruptcy for $4.8 billion. As it’s privately held, the exact current value of MGM isn’t known.
But even if that value has doubled on 15 years, it’s still well within Apple’s purchasing power. In its most recent financial statement, Apple revealed it has $205.9 billion cash on hand, which could easily be used for acquisitions. That said, Apple generally shies away from large purchases. Its largest to date is Beats for $3 billion.
