Sources: Apple planning push into original TV shows and movies for Apple Music subscribers, hopes to share viewer metrics and demographic data with producers
Apple is planning to build a significant new business in original television shows and movies, a move that could make it a bigger player …
Context & Ripple Effects
Apple's original-content ambitions have been building since at least 2015, when sources reported it was escalating talks with Hollywood executives to stand up development and production teams explicitly to compete with Netflix (escalating talks with Hollywood execs). This January 2017 report is the first concrete shape of that effort: originals delivered through Apple Music rather than a separate video service, with Apple's differentiator being the viewer metrics and demographic data it can share with producers.
The move lands mid-fight with its media partners — Recode reported that same year that Apple would likely only succeed in TV once its own originals hit the market (only succeed with TV when it brings its original shows to market) — and within months Apple had reportedly set a ~$1B budget to procure and produce up to ten shows (~$1B original-content budget). The data-sharing pitch matters because it is the one asset Netflix-style rivals have and traditional studios lack.
First-order effects
- Producers working with Apple gain something no other buyer offers at scale: direct viewer metrics and demographic data from Apple Music's subscriber base, which changes what they can promise advertisers and financiers.
- Apple Music subscribers get original shows and movies bundled into an existing subscription, turning a music service into a broader entertainment bundle without a new app or price point.
Second-order effects
- Netflix and Amazon's data-driven commissioning model stops being a differentiator — Apple's entry forces every major content buyer to compete on how much audience insight they hand talent, raising the market price of proven showrunners and producers.
- Traditional media partners, already in conflict with Apple over terms, face a buyer that can fund originals outside their economics entirely, weakening their leverage in carriage and licensing negotiations.
Third-order effects
- The pattern holds across the corpus: the $1B year scales to a $6B+ commitment ahead of Apple TV+'s launch ($6B+ committed ahead of Apple TV+'s launch), output doubles toward weekly releases by 2021 (doubling output to at least one release a week), and by 2024 Apple is negotiating directly with the largest Hollywood studios for library programming (talks with major studios over library licensing) — a structural shift from device maker to standing content buyer with its own distribution.
- If platform owners keep converting proprietary audience data into content-commissioning power, Hollywood's dealmaking shifts toward whoever owns the customer relationship, with studios increasingly supplying inventory to platforms rather than controlling it.
The trend: Platform companies are converting proprietary audience data and installed bases into original-content buying power, pulling them from distributors into direct competitors of the studios they once partnered with.