Report: Apple Wants Better ROI From its TV+ Spending

After investing billions of dollars into original movies and TV shows, Apple is reportedly looking to make its Apple TV+ service more sustainable with some cost-cutting measures. A new report from Bloomberg reveals that the company wants to change its reputation as the biggest spender in Hollywood after investing over $20 billion to produce exclusive content that didn’t exactly bring big viewership numbers for its streaming service.

Apple TV+ originally launched at $4.99 per month in November 2019 with a limited selection of eight original series and one original documentary. Apple continued to invest in original programming over the years, with many projects featuring high-profile Hollywood talent and receiving critical acclaim.

However, the service, which is now priced at $9.99/month, can’t really compete with Netflix and other platforms with a large back catalog of licensed films and TV shows, even though this is something Apple recently started to invest money in. As for Apple’s original films and TV shows, which can be really expensive to produce, they don’t seem to deliver the kind of return on investment that the company is seeking.

“Apple is spending billions of dollars a year on original programming that has received strong reviews and many awards nominations. But its streaming service is attracting just 0.2% of TV viewing in the US,” the Bloomberg reports pointed out citing Nielsen’s rankings.

According to the report, Eddy Cue, Apple’s senior vice president of Services now has regular meetings with studio chiefs to push them to change how they operate and take less financial risks. The company also plans to continue investing in content licensing deals to grow the Apple TV+ library in a less expensive way.

“Management is trying to pay less up front for shows and is quicker to cancel ones that aren’t working,” the report said. It’s forcing third-party studios to shoulder more of the burden when productions go over budget and is starting to license programming from competitors to reduce the service’s reliance on original series.”

Apple’s more cautious approach regarding its TV+ business means that the company may now refuse to buy shows it may have accepted before. Moreover, the company has been reportedly forced to delay the production of some shows such as Foundation to prevent them from going over budget.

Apple remains one of the richest companies in the world, and it’s willing to invest billions of dollars into original content to increase its “soft power” and improve its brand perception. Apple TV+ shows getting critical recognition and winning awards somewhat reinforce the perception that Apple is all about “quality.” However, the company can’t be satisfied with spending so much money on Apple TV+ and seeing it get fewer viewings in one month than Netflix does in one day, according to Nielsen numbers.