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Apple’s TV strategy needs a lot more than just original content to succeed

Apple TV Strategy

With original content akin to currency in the tech world these days, it’s no surprise that Apple over the past few months has gotten dead serious about developing original programming designed to lure viewers away from services like Netflix and HBO. To this end, Apple this past August established a $1 billion fund to be used for developing, producing, and acquiring original content.

Since then, Apple has impressively ramped up its original programming efforts. Over the last few months, we’ve seen Apple ink an intriguing deal to revive the award-winning 80s show Amazing Stories along with plans to roll out a new original series starring A-listers Jennifer Aniston and Reese Witherspoon. More recently, word surfaced that Apple now finds itself in the midst of a bidding war with HBO for a new sci-fi drama from J.J. Abrams.

By all accounts, Apple is finally making some smart moves in the TV space, a point worth highlighting given the forgettable disaster that was Planet of the Apps. Still, there’s one aspect to Apple’s TV strategy that, from what we can currently gather, seems to be conspicuously absent. Specifically, Apple will need a lot more content if it ever wants to be taken seriously as streaming video provider.

Take Netflix, for example. The streaming giant is renowned for its original content, but the vast majority of Netflix viewers spend their time either watching movies or existing TV shows Netflix has a license for. Hulu has a similar dynamic as most viewers on that platform spend their time watching licensed TV content. The following chart from Hub Entertainment Research (via Quartz) illustrates the breakdown nicely.

Put simply, if Apple ever wants to be taken seriously as a purveyor of streaming video, the company will have to shell out some additional cash to license movies and established TV series on its platform. This, of course, has the potential to eat into revenue Apple currently enjoys via selling and renting media content on iTunes. Looking ahead, it will be interesting to see how Apple, if at all, is planning to address the issue. As a quick aside: if Apple is simply rolling out original content as a means to bolster its Apple Music subscription service, it may find out the hard way that trying to attract music lovers by appealing to TV lovers isn’t the smartest move. Similarly, if Apple thinks users will be willing to pay for a monthly TV subscription for a dozen or show original programs, it may also be in for a rude awakening.

Yoni Heisler has been writing about Apple and the tech industry at large for over 15 years. A life long Mac user and Apple expert, his writing has appeared in Edible Apple, Network World, MacLife, Macworld UK, and TUAW. When not analyzing the latest happenings with Apple, Yoni enjoys catching Improv shows in Chicago, playing soccer, and cultivating new TV show addictions.