As Amazon, Netflix and Spotify engage in an arms race for original content to woo subscribers, Apple is taking an old-school route to produce its own shows and movies.
Apple is considering moving its original content division to the Culver Studios, a longtime Hollywood powerhouse studio that made classics like “Gone With the Wind” and “The Matrix,” according to the Financial Times on Friday.
The move would be an evolution of Apple’s plan to spend $1 billion in original content to attract subscribers to Apple Music. Apple recently hired former Sony co-presidents Jamie Erlicht and Zack Van Amburg to lead the initiative.
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Apple’s first two shows, “Planet of the Apps” and “Carpool Karaoke,” have received mixed to negative reviews and have not hooked as many viewers as it hoped.
Apple is reportedly trying to outbid Netflix for a new drama starring Reese Witherspoon and Jennifer Aniston, set on a morning chat show. Hollywood insiders are taking the moves as Apple flexing its deep pockets — more than $256 billion in cash — and a new dedication to beating its content-streaming competitors.
“They woke up and said, ‘Let’s really do this’,” said one Hollywood agent to the Financial Times. “It’s a lot different to a year or two ago.”
But not everything has been “Kumbaya” between Apple and Hollywood. Apple and Hollywood studios have been arguing with one another about the price point to sell Apple’s original content shot in 4K, which offers significantly sharper visuals than a full-HD video. Apple is expected to unveil on Sept. 12 a new Apple TV that offers 4K compatibility.
Whereas Apple wants to release the 4K content at $19.99 per download, Hollywood studios have been arguing for $24.99 to $29.99 per download to protect their profit margins, according to the Wall Street Journal.
“I wouldn’t tell Apple how to price their iPads,” said one studio executive to the Journal.
Netflix and Amazon are established as the two front-runners in original content, spending billions of dollars to produce a variety of shows and movies. Netflix is preparing to spend $7 billion in 2018 on content, according to a Variety feature on its chief content officer, Ted Sarandos.
Unlike Netflix, which exclusively provides its content on its platform, Amazon has taken a more traditional approach. Amazon’s original films, like the Oscar-winning film “Manchester by the Sea,” are released in a traditional theater window before they become available on its platform.
“I don’t think we compete with Amazon in the movie space at all,” said Sarandos in the Variety feature. “I frankly don’t understand their strategy. I don’t understand why perpetuating a model that feels more and more disconnected with the population is good.”
Spotify is a distant fourth and appears to be on the verge of dropping out altogether. Spotify’s head of video and podcasts Tom Calderone left the company on Thursday, and Spotify indicated it will focus more on the music industry, according to Bloomberg.
Photo: Apple CEO Tim Cook ends his keynote address at the Worldwide Developers Conference at the McEnery Convention Center in San Jose on Monday, June 5, 2017. (Gary Reyes/ Bay Area News Group)
Tags: amazon, Apple, apple tv, Hollywood, Netflix, streaming