Streaming TV Service Revenue Will Be a ‘Drop in the Bucket’ for Apple, Even If It Rivals Netflix

Analyst Tim O’Shea recently published a new research report looking at the impact of Apple’s upcoming streaming TV service on the company’s overall financial earnings (via Business Insider). According to O’Shea, even if Apple priced the service at $15/month (and took a 30 percent cut, while the rest went to video production partners), the resulting revenue would just be “a drop in the bucket.”



O’Shea predicted that if Apple could get to 250 million subscribers by 2023, it would earn the company $13.5 billion in revenue and account for about 5 percent of the company’s revenue that year. Not only that, but 250 million subscribers in four years is a generous prediction, given it took Netflix 12 years to reach its 139 million subscribers as of January 2019.

“It’s going take a long time for this type of service to really move the needle,” O’Shea told Business Insider. To figure out the potential of the video service, which Apple is widely expected to launch next month, O’Shea estimated that Apple would charge customers $15 a month and take a 30% cut, giving the rest to video production partners

If the service is extremely successful and attracts 250 million subscribers, it would yield $13.5 billion in revenue for Apple. That’s nothing to sneeze at. After all, Netflix’s total sales last year were $15.8 billion. But in the context of Apple, such a figure would be just a drop in the bucket.

In fiscal 2018, the company posted revenue of $265 billion. Though O’Shea and other analysts expect Apple’s sales to drop sharply this year before slowly recovering in coming ones, $13.5 billion would still represent only a small fraction of the company’s revenue.

To be clear, O’Shea isn’t predicting that Apple will price its streaming TV service at this level, but the analyst is simply providing a “what if” scenario for the launch of the service. CNBC previously reported that Apple will offer its original TV shows for free to Apple device owners, and new reports have suggested that users will be able to add more premium channels onto the service at a cost.

As part of these recent rumors, it’s also been suggested all users will have to pay a monthly subscription to gain access to Apple’s original TV shows. In regards to these rumors, a price has not yet been put forward. More clarity should be given to Apple’s streaming service on March 25, when the company is expected to host a major event debuting the service and outlining its big features.

This article, "Streaming TV Service Revenue Will Be a 'Drop in the Bucket' for Apple, Even If It Rivals Netflix" first appeared on MacRumors.com

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Apple to Announce TV Service at March 25 Event, But Launch is Months Off

While Apple is planning to preview its rumored streaming TV service at an event that’s set to be held on March 25, a launch may not happen for several months.

According to sources that spoke to Variety, Apple will announce the service in March, but it may not be available to customers until the summer, or as late as fall.

Sources familiar with the plans say Apple’s video service will be targeted for a launch in summer or fall rather than the April timing that has been the subject of media speculation. Apple has vowed to its high-caliber producing partners to mount marketing blitzes on behalf of the shows in addition to the service itself.

Apple has more than two dozen original television shows in the works, many of which have already been cast. It’s not clear if filming has started, but holding the launch of the service until at least some of the shows are available would make sense.

Apple has not yet announced its March 25 event, but multiple rumors from well-respected sites have indicated that’s the date when it will be held.

The March 25 event will be focused on services, and Apple is not expected to debut new hardware even though there are multiple rumors of products getting a spring refresh.

We could instead see devices like the AirPower, iPad mini 5, new AirPods, a seventh-generation iPad, and a seventh-generation iPod touch announced via press release given that these are all minor updates.

Major stars that include Jennifer Aniston, Reese Witherspoon, and Steve Carell, all of whom have roles in Apple shows, have been invited to attend the March event, which will also include an announcement of a new Apple News service.

Variety‘s sources caution that specific plans for the event and how the video service will be introduced may be “in flux until the minutes Cook steps on the stage.”

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Tim Cook Says Apple Plans to Participate in the ‘Breakdown of the Cable Bundle’ With AirPlay 2, Original Content and More

Apple CEO Tim Cook today commented on the opportunities Apple sees in the video market, though he declined to provide details on the company’s specific plans.

Cook said that Apple sees “huge changes” taking place in customer behavior, which the company expects to “accelerate as the year goes by.” Specifically, Cook said that Apple is expecting an acceleration of the breakdown of the cable bundle. “I think it’ll likely take place at a much faster pace this year,” he said.



Apple plans to “participate in that” in a number of ways, including the Apple TV, which offers support for apps so customers can watch television content on a per-app basis, and AirPlay 2, which will soon support third-party television sets. Cook said Apple is “excited” about the expansion of AirPlay 2 compatibility to third-party television companies because it will make the experience with people using Apple products in the living room “even better.”

Cook said that third-party video subscriptions available on the App Store provide another opportunity for Apple that could “accelerate in the future” as customers are likely to buy multiple services, and finally, Cook pointed towards Apple’s own work on original content.

Finally, original content, where we will participate. We’ve signed a multi-year partnership with Oprah. Today I’m not really ready to extend that conversation beyond that point. We’ve hired some people we have a super amount of confidence in, and they’re working really hard. We’ll have more to say on that later.

Rumors have suggested Apple is working on a full streaming television service to distribute both its original content and content from third-party providers such as HBO and STARZ. At least some of the content Apple is creating could be available for free, and Apple is said to be planning to integrate the service and the new TV shows into its TV app.

Apple has more than two dozen original television shows in the works, many of which are in the casting stages, with filming likely set to begin soon. Apple has also purchased movies and inked deals with well-known industry talent including Jason Katims and Justin Lin.

Apple is aiming to have its streaming television service ready for a mid-April launch, and has been telling its launch partners to prepare for that date. An actual release could come right around that target date.

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Apple Signs Deal for ‘Hala,’ a Coming-of-Age Drama Executive Produced by Jada Pinkett Smith

Apple has purchased the rights to “Hala” a coming of age drama directed by Minhal Baig and produced by Jada Pinkett Smith, reports Variety.

The movie premiered at the 2019 Sundance film festival, and marks Apple’s first purchase of the event. It’s not known if “Hala” will debut on iTunes or if it will be shown in theaters.



“Hala” follows the life of Hala, a 17 year old girl “navigating the conflicting worlds of her traditional Muslim household and her modern high school.”

“Hala is her father’s pride and joy. Dutiful and academically gifted, she skillfully navigates both her social life as a teen in Chicago and her obligations as an only child to Pakistani immigrants. With high-school graduation looming, however, Hala is bursting with sexual desire. When she meets Jesse, a classmate who shares her love for poetry and skateboarding, their romance is complicated by her Muslim faith and a father who is prepared to arrange her marriage according to their family’s cultural tradition. As Hala begins to challenge these customs, her parents’ own lives start to unravel, testing the power of Hala’s flourishing voice.”

Geraldine Viswanathan, known for “Blockers” plays the title role, while Purbi Josh, Azad Khan, Gabriel Luna. Anna Chlumsky, and Jack Kilmer also star. “Hala” is director Minhal Baig’s second feature-length film.

“Hala” is one of several movies that Apple is distributing. The company has also signed a deal with film studio A24, and it has acquired the rights to “The Elephant Queen.” Apple also has more than a dozen original television shows in the works, with details available in the original content section of our Apple TV roundup.

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Showrunner Jason Katims Leaves Universal TV to Develop Content for Apple

Well-known producer, writer, and show creator Jason Katims has departed Universal TV after inking a multi-year deal with Apple, according to The Hollywood Reporter.

Under the exclusive deal, which kicks off this summer, Katims will create content for Apple under his True Jack Productions banner.

Katims has been responsible for many high-profile television shows, including “Parenthood,” “Friday Night Lights,” “Roswell,” “Rise,” and “About a Boy.”

He will continue to work on “Away” and “Sisters,” two projects that he has in the works with Universal TV, but future content will be exclusive to Apple.

Katims is rejoining Michelle Lee, who formerly served as head of development at True Jack before moving on to Apple’s creative development team.

Apple has signed deals with multiple high-profile figures and companies in the TV industry for its upcoming streaming service. Apple is partnering with film studio A24, Oprah, and Sesame Workshop.

The company also already has multiple television shows in the works, with a full list available in our Apple TV roundup.

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Apple’s First A24 Film to Star Bill Murray and Rashida Jones, Sofia Coppola to Direct

Apple late last year teamed up with indie entertainment studio A24 to produce a series of films for its upcoming streaming service, and now the first film under that partnership is in the works.

According to Variety, Apple and A24’s first movie will be directed by Sofia Coppola, known for directing movies like “The Virgin Suicides,” “Lost in Translation,” “Marie Antoinette,” and “The Bling Ring.”

Image credit: Guillaume Collet/Sipa/REX/Shutterstock, via Variety


The movie, “On the Rocks,” will star Bill Murray, who often works with Coppola, and Rashida Jones, known for her roles in “The Office” and “Parks and Recreation.”

“On the Rocks” will follow a young mother who reconnects with her larger-than-life playboy father on an adventure through New York. Production on the movie is set to start next month.

Apple has more than a dozen television shows in the works, with many in the casting stages, but the filming schedule for “On the Rocks” suggests it will be Apple’s first movie to be completed.

Rumors have suggested Apple is working on a streaming service that will provide access to Apple-produced TV shows and movies, with some content available for free. Apple is said to be aiming to launch the new service in 2019.

Related Roundups: Apple TV, tvOS 12
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Apple Inks Deal With DHX Media to Produce and Release All-New ‘Peanuts’ Content

In one of the bigger deals for Apple’s upcoming streaming TV service, Variety reports today that the Cupertino company has made a deal with DHX Media to produce all-new “Peanuts” content that will be exclusive to Apple.

Image via Variety/Peanuts Worldwide LLC


Under the deal, DHX and its subsidiary Peanuts Worldwide will develop and produce the original series, specials, and shorts, while Apple will release it on its streaming service. One such project will be a Peanuts short featuring astronaut Snoopy that will be themed around STEM education, which Apple has long supported.

It’s unclear what else will be coming to Apple’s service from the Peanuts characters, and the report makes no mention of Apple gaining the rights to existing Peanuts content. The franchise dates back to 1950, when Charles M. Schulz created the Peanuts comic strip, which has now grown into a larger media franchise of TV specials, feature films, short films, merchandise, and more.

News of content acquired by Apple for its streaming service has been increasing lately, and in the past few weeks we’ve heard about new cast members for shows from M. Night Shyamalan, a new series starring Jennifer Garner, and Apple’s interest in a violent drama show starring Richard Gere. Previous rumors suggested Apple’s TV service would launch around March 2019, but now Variety reports that the debut will be sometime in the second half of 2019.

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Apple Hunting for Next ‘Breaking Bad’, Interested in Violent Drama Starring Richard Gere

Apple is reportedly in negotiations to purchase the rights to Israeli drama series “Nevelot” (or, “Bastards”), which is described as a violent and mature drama series (via CNBC). Richard Gere could star in the adaptation, which is being written and created by “Homeland” creator Howard Gordon and “Law and Order: SVU” showrunner Warren Leight.

Image via Variety / Rex Features


Apple is said to be in a bidding war with Showtime, FX, and Amazon for the show, which revolves around two military veterans who go on a killing spree targeting young people, “because they believe today’s kids don’t understand the sacrifices of their generation.” Gordon and Leight would reformat the show for the American market, and potentially change the title.

Right now, all sides are said to still be in talks, and nothing is finalized. If certain agreements can’t be reached — like the budget — then it has a risk of falling through.

Apple’s interest in such a mature-themed series comes in stark opposition to previous reports we’ve heard about its upcoming string of TV shows. Most notably, in a September report The Wall Street Journal claimed that Apple would be unlikely to produce original content that contains gratiuitous sex, violence, profanity, or risqué storylines in an effort to avoid tainting its wider brand image.

Unless the entire concept of “Bastards” is changed, it appears like the show would include most, if not all, of those adult pieces of content. CNBC‘s report today suggests that Apple is on the hunt for its own “Breaking Bad”, a show with a Mature Audiences rating that aired on AMC from 2008 through 2013.

Additionally, Apple is said to be looking for “different” content, as long as it has substance and isn’t gratuitous. The search is said to be emphasizing unusual formats that won’t fit in the traditional 30-minute and 60-minute time slots. The company is also experimenting with more advanced interactive and immersive content of some kind, but these plans are painted as a “long-term vision” for Apple’s original content efforts, and not indicative of the more straightforward shows we’ll see when everything first launches next year.

In one final tidbit from today’s report, the long-in-production morning show drama starring Reese Witherspoon and Jennifer Aniston is said to be called “Top of the Morning,” the same as the book it’s based on. For a list of every show coming from Apple, check out our full Apple TV Roundup.

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