Apple Tightening Purse Strings After Limited Success With TV+ Projects
Credit: Apple
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Apple is cutting the budgets for its new Apple TV+ projects after investing more than $20 billion on original shows and films and having only limited success, according to a new report from Bloomberg.
Apple’s tightening of the purse strings comes after Apple TV+ has failed to capture a significant share of the streaming market. The streaming service has earned only 0.2% of TV viewership since its first stream in 2019, compared to other streaming services, like Netflix, which currently holds an 8% share of steaming viewers. This means Apple TV+ content gets fewer viewers in a month than Netflix does in a single day.
Apple TV+ is lagging behind other major streaming services, despite investing heavily in original content. However, the service has scored well with critics and received numerous award nominations — including a record 72 Emmy nominations last week.
Only four Apple TV+ series have made Nielsen’s weekly top 10 original streaming list. While Ted Lasso was the most-viewed streaming show of 2023, other Apple TV+ shows have not performed as impressively.
Apple entered the streaming competition with an open pocketbook, hiring big-name talent and announcing high-profile projects. The streaming service signed deals with several high-profile celebrities and actors, including Oprah Winfrey, Jennifer Aniston, and others. The service quickly gained a reputation as a talent-friendly streaming service willing to pay big bucks to create premium streaming content.
Apple spent over $500 million on films from Ridley Scott, Martin Scorsese, Matthew Vaughn, and other top-name directors. While the streaming service’s series and films have received glowing reviews and several award nominations, it has yet to see the viewership numbers it was looking for.
The company is said to now be following a more budget-minded strategy, tightening budgets and taking a slightly more cautious approach to spending on new projects. Apple is now paying less for new content, has quickly canceled underperforming series, and delayed productions when costs can be better managed.
For example, Apple delayed the production of its science fiction series Foundation due to fears of budget overruns from delays caused by the 2023 actor and writer strikes. Meanwhile, the per-episode budget for the second season of Severance has jumped to $20 million per episode thanks to pandemic delays, production conflicts, and other expenses. Severance producers have been told to cut the budget for future episodes as Apple TV+ fights to gain financial equilibrium.
The streaming service is also attempting to rid itself of its free-spending reputation and is becoming much more picky about the new projects it signs, backing away from projects that it may have been eager to take on just a few years ago.
Apple TV+ is still investing in its proven high-profile series, including The Morning Show. However, those series are a big drain on the streaming service’s bank account, as salaries are a major expense. Salary expenses for The Morning Show will amount to over $50 million. Headlining stars Jennifer Aniston and Reese Witherspoon will each continue to make $2 million per episode for their work on the popular series this season.
Apple TV+’s tightening of the purse strings comes as Disney, Paramount, and other major studios have also cut back on their streaming budgets following disappointing results.
