Struggling SVOD service Apple TV+ is reportedly set to spend $1 billion annually on original movies — with conventional theatrical windows — in an attempt to up its game and become more competitive among such higher-profile rivals as Paramount+ and Peacock.
Apple TV+, which reportedly has fewer than 40 million paid subscribers, has struggled out of the SVOD gate, relying on a small content slate of original programming, and avoiding licensing third-party shows and movies, to woo paid subscribers (consumers of Apple devices get a free 12-month subscription). The result has been largely indifference among Wall Street analysts, some of whom scoff at the platform’s lack of content.
Wedbush Securities analyst Michael Pachter contends that despite a major marketing effort around the Apple TV+ launch, which included signing up Jennifer Aniston, Reese Witherspoon and Steven Spielberg for original content, the finished product thus far has been underwhelming.
“It only had a handful of shows at launch,” Pachter wrote in a 2020 note to investors.
But that was then. Now, Apple is hoping to elevate its original feature film aspirations on the backs of studios and exhibitors looking to jumpstart the moviegoing experience among consumers.
The company is looking to partner with studios and for upcoming Apple TV+ releases such as director Matthew Vaughn’s espionage thriller Argylle, and director Ridley Scott’s historical drama Napoleon, starring Oscar winner Joaquin Phoenix as Napoleon Bonaparte, according to Bloomberg, which cited sources familiar with the situation.
Apple TV+, unlike most other subscription streaming video services, has embraced the theatrical window since its inception in 2019. That loyalty was rewarded in 2022 when the streamer’s original movie CODA won best picture, best adapted screenplay and best supporting actor at the 2022 Academy Awards.
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Apple in 2021 paid a record $25 million for CODA at the Sundance Film Festival, yet generated less than $2 million at the box office. The 2021 crime drama Cherry, starring Spider-Man’s Tom Holland, fell victim to shuttered screens during the pandemic.
Apple reportedly eyes the theatrical window as a means of marketing Apple TV+ to consumers similar to the way the Emmy Award winning “Ted Lasso” and “The Morning Show” have done for for the platform’s episodic programming.
As a result, Apple would like to expand its movie distribution (and spending) beyond a few hundred screens to the conventional 3,000+ screen North American debut. Rival Netflix, which in 2021 acquired the Egyptian Theatre in part to appease industry award rules regarding theatrical releases, this year extended an erstwhile non-theatrical release policy to include a 600-screen debut for Glass Onion: A Knives Out Mystery.
If the company is going to spend hundreds of millions of dollars on a [director Martin] Scorsese movie, it wants to turn that into a cultural event,” according to Bloomberg.
“Film creators strongly believe in theatrical exhibition as a measure of success,” echoes Wedbush Securities media analyst Michael Pachter.