Can Apple take its understanding of consumer’s wants and desire for devices and do the same with original content?
The Cupertino, California-based tech giant certainly plans on it giving it a try. According to a Wall Street Journal report on Wednesday, Apple (AAPL) plans to spend roughly $1 billion to acquire and develop original TV series and films over the next year. Apple also recently poached former Sony Pictures Television executives Jamie Erlicht and Zack Van Amburg, who oversaw “Breaking Bad” and “The Crown,” to lead its original content efforts.
Impressive as that may sound, Apple still has a lot to prove. For one, its initial foray into original content — “Planet of the Apps” and “Carpool Karaoke” — haven’t impressed critics.
“For lack of a better term, they’re glorified YouTube content,” explained Omar Akhtar, an analyst for the digital research firm Altimeter Group. “Apple needs to stop investing in subpar, amateur content. They have to get away from the angle first.”
Obvious as that may sound, finding and developing the next “House of Cards,” “Transparent,” or “Handmaid’s Tale” is easier said than done.
A staggering amount of user data at its fingertips
“We know how good Apple is at understanding people’s wants and needs and translating that into devices and apps,” said Jim Nail, a principal analyst at Forrester Research. “But can they take that consumer understanding to develop great long-form storytelling and TV content?”
Just as Netflix (NFLX) uses data from its users to figure out what kind of original content to greenlight and develop, so can Apple. Although Apple has not given an updated figure for the number of the iTunes accounts since 2014, CEO Tim Cook did specify that year Apple had about 800 million iTunes accounts. That’s a staggering amount of user data to sift through, analyze and use towards deciding which movies and series to develop and distribute.
If Apple sees a significant chunk of its iTunes users gravitate towards sci-fi series, for instance, the company might pour a good chunk of its budget into developing high-quality shows in that genre. If the company realizes an overwhelming number of iTunes users rent or buy films starring Ryan Gosling, it may try signing the actor to do an Apple-exclusive film. That proved to be the case for Netflix, which initially signed comedian Adam Sandler in 2014 for a four-movie deal and extended their partnership earlier this year to finance and distribute another four films.
“Copying Netflix’s strategy in this case wouldn’t be such a bad thing, although they can’t ‘handcuff’ Sony execs too much,” contended Nail, who explained that while Apple could and should use iTunes user data to help inform production decisions, Erlicht and Van Amburg should also have creative license to develop content as they ultimately see fit.
As for Apple’s initial missteps with “Planet of the Apps” and “Carpool Karaoke”? Those could easily be forgiven and forgotten if Apple eventually lands a bonafide hit.
“Apple is very good at iterating,” Akhtar said. “They usually nail it the first time, but when they don’t, they iterate pretty quickly on top of it.”
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