Report: Apple TV+ Facing Growing Pains, Despite Becoming First Streamer to Win ‘Best Picture’ Oscar
While Apple TV+ became the first streamer to win Best Picture at the Academy Awards on Sunday, according to an article from Business Insider, sources have admitted that the company is not the well-oiled machine that CEO Tim Cook likes to portray.
Apparently, the content team is under-resourced and has been experiencing frustrating hiccups such as slowed growth behind the scenes and “disruptive, last-minute marketing planning for projects that have been in the works for months” as well as “landing pages for series that weren’t ready in time.”
Considering Apple’s recent deal with Major League Baseball and its bid on the table for NFL's “Sunday Ticket,” many are questioning whether the burgeoning streaming giant will allow its leadership structure to evolve, given its tech parent company’s reputation for keeping tight control over everything?
Insider spoke to 14 Hollywood and Apple insiders, the majority of them remaining anonymous, about how Apple can address challenges as they grow into a force in the streaming wars. The sources said that only is Apple TV+ understaffed, but according to two content executives who’ve done business with the streamer, the service’s in-house lawyers have little knowledge of common entertainment law practices, which slows down deal-making, a vital part of the fast-moving process. There was even an Apple TV+ show that began streaming before the contract was even signed.
Another executive said that they sold a show to the company but experienced problems when trying to get invoices paid. They said, “It’s a reflection of their corporate culture to stretch the terms of payment out as long as possible… It’s really frustrating.”
Similar to Netflix and Amazon Prime Video, Apple began its streaming journey by acquiring projects produced by outside studios. “Ted Lasso” from Warner Bros. was bought by the company, and Best Picture winner “CODA” premiered at Sundance when the tech giant scooped up the film for $25 million. As Apple TV+ expands its library, “they want to make everything themselves,” a content executive remarked. “But they don’t have the people.”
Now with sports added to the mix, Apple not only has its MLB deal and an offer for NFL’s “Sunday Ticket” package, but it also has been reportedly keeping its eye on the NBA and Formula One, which would only bring new challenges and possibly new leadership.
“The live sports strategy is something that’s going to be a big change,” a former Apple executive told Insider. “It presents a shift away from the strategy of originals.”
Another former Apple staffer told Insider that there is burnout looming over the streaming service, partly a result of the many shows that were delayed by the pandemic and are now all rushing to air at the same time. “There’s going to be a breaking point. People are stretched thin and working too hard,” the ex-employee said.
Per an inside source familiar with the subject, the company is hoping to rectify workflow issues by hiring more mid-level content executives to manage cost projections and budgeting. Despite the need for a more senior executive to lead the company’s film efforts, current film head Matt Dentler, a former SXSW film festival producer, is still running the show. However, there are whispers of a shift in leadership that is “bigger than Zack and Jamie,” referencing Apple TV+ Chiefs Jamie Erlicht and Zack Van Amburg.
The company will spend $8 billion on content in 2022, according to a Wells Fargo estimate, which is less than two-thirds of Netflix’s $13.6 billion and will be for significantly fewer hours of content. Evercore’s Apple analyst, Amit Daryanani, estimated the streaming service’s annual revenue ranges from $1 billion to $1.5 billion based on a $4.99 monthly subscription.
A few months ago, Cook said on Apple’s quarterly earnings call that Apple TV+ isn’t looking for a financial payback on content investment because they “don’t make purely financial decisions about the content” on the service. According to him, content that has “a good message and may make people feel better at the end of it” is more important.
Along with original, unique, “feel-good” content, Apple also has leverage on other services when it comes to the level of Hollywood talent. Apple has formed programming partnerships with Oprah Winfrey, Prince Harry, Jennifer Aniston, and Martin Scorsese. Creative stakeholders in Hollywood previously told Insider that while Apple TV+’s laser focus on A-list creators and stars keeps its volume low, the streamer’s deals are generous.
Chris Albrecht, the head of Legendary TV and the former CEO of Starz and HBO, said, “What Oscars get is reputation and talent, and talent is what gets you, subscribers. And if you can demonstrate you are the best home for talented people who have a passionate point of view about something that relates to the human experience, you’re going to have an opportunity, more often than not, to put out some hit programming.”
Apple’s three Academy Awards for “CODA” will hopefully boost Apple TV+ content ambitions, and it will most likely increase the streamers’ subscriber base as well as feature more content with A+ Hollywood talent.
Apple TV+
Apple TV+ is a subscription video streaming service for $9.99 a month that includes high-quality original shows and movies including Best Picture winner “CODA,” popular sitcom “Ted Lasso,” and dramas like “The Morning Show” and “Severance.” Apple TV+ is also home to MLB baseball games on Friday nights and MLS Season Pass.