By Apple is scaling back its investment in producing TV shows and movies following substantial losses in recent years. The company has poured over $20 billion into content that has seen limited viewership. According to Bloomberg, Eddy Cue, who oversees Apple’s services, is now frequently meeting with Zack Van Amburg and Jamie Erlicht, the heads of Apple’s TV studio.
They are discussing strategies to reduce spending on new shows and movies. According to Bloomberg, Apple TV+ accounts for only 0.2% of TV viewership in the United States. This means that in one month, Apple TV+ attracts fewer viewers than Netflix does in a single day, with Netflix holding an 8% share of TV viewership.
High-Cost Projects Aren’t Drawing Viewers
Apple has been renowned for its hefty investments in individual projects. For instance, they spent over $500 million on films by acclaimed directors like Martin Scorsese and Ridley Scott. They also invested more than $250 million in a World War II series titled “Masters of the Air.” However, these high-budget projects did not attract a significant audience.
To curb expenses, Apple is now adopting strategies such as paying less upfront for new shows, swiftly canceling underperforming series, requiring other studios to cover budget overruns, and purchasing some shows from other companies instead of producing everything in-house. Additionally, Apple is being more frugal with budgets on popular shows like “Severance” and “Foundation,” aiming to reduce production costs.
No Layoffs in TV Division So Far
Despite cutting back on spending, Apple hasn’t laid off many employees, unlike other TV companies. This is because Apple’s primary revenue comes from selling iPhones and other devices, rather than TV shows. Apple TV+ has garnered awards and positive reviews from critics but hasn’t achieved the viewer numbers Apple anticipated. The company now aims to make its TV business more successful while reducing expenditures.
The impact of these changes on the quality of Apple’s shows remains uncertain. The company is striving to strike a balance between producing high-quality content and cutting costs. Apple does not disclose much information about its TV business’s financials, making it difficult for outsiders to gauge Apple TV+’s exact performance.
