Apple TV+ Curbs Costs After Expensive Projects Fail to Capture Viewers

Apple is scaling back its Hollywood spending after investing over $20 billion in original programming with limited success, Bloomberg reports.

Apple TV Plus Feature 2 Magenta and Blue
This shift comes after the streaming service, which launched in 2019, struggled to capture a significant share of the market, accounting for only 0.2% of TV viewership in the U.S., compared to Netflix's 8%. Despite heavy investment, critical acclaim, and numerous award nominations, Apple TV+ purportedly generates less viewing in one month than Netflix does in a single day.

Over the last five years, the ‌Apple TV‌+ has had only four series make Nielsen's weekly list of the ten most popular original streaming shows. While Ted Lasso was the most-watched streaming show of 2023, ‌Apple TV‌+ still accounts for a smaller share of top ten hits than any streaming service except Paramount+.

Apple's initial foray into streaming was marked by lavish spending on high-profile projects and talent, including deals with big names like Oprah Winfrey, Steven Spielberg, and Jennifer Aniston. The company's Hollywood operation, led by studio chiefs Zack Van Amburg and Jamie Erlicht, positioned itself as a talent-friendly destination, reminiscent of HBO, offering creators seemingly unlimited financial resources.

Apple spent more than $500 million combined on movies from directors Martin Scorsese, Ridley Scott, and Matthew Vaughn, and upwards of $250 million on the World War II miniseries Masters of the Air. Despite the strong reviews and awards nominations, these projects have not yielded the viewership that Apple apparently hoped for.

The company's new strategy is said to involve tighter budget controls and a more cautious approach to spending. This includes paying less upfront for shows, being quicker to cancel underperforming series, and delaying productions to manage costs better. For instance, the production of the sci-fi series Foundation was postponed to prevent budget overruns caused by delays related to the 2023 actors and writers strikes.

The cost of the second season of Severance surged to over $20 million per episode due to pandemic-related delays, internal conflicts, and additional expenses such as hiring House of Cards creator Beau Willimon for script contributions. Management has asked the producers of Severance to reduce the budget for future seasons, emphasizing the need for financial sustainability.

Apple has also become more selective in acquiring new projects, declining to buy some shows that sellers believe the company would have accepted just a few years ago. The company allegedly wants to shed the image of being Hollywood's biggest spender and bring more discipline and strategy to its content investments.

While still willing to invest heavily in certain high-profile projects, such as The Morning Show, where cast salaries alone exceed $50 million for the upcoming season, ‌Apple TV‌+ is becoming more fiscally conservative. The Morning Show stars Jennifer Aniston and Reese Witherspoon will each earn more than $2 million per episode. This recalibration comes at a time when other major studios like Disney, Warner Bros., and Paramount are similarly cutting back on streaming budgets due to mounting losses.

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Top Rated Comments

AppleTO Avatar
13 months ago
I don’t know why, but I just find Apple’s content kind of cringey to watch. I wish they would stop all this and just focus on technology.

Paying a ton of money for high profile actors and directors doesn’t guarantee success.
Score: 66 Votes (Like | Disagree)
SpotOnT Avatar
13 months ago
You really don’t need a huge budget to make something entertaining…

The whole industry needs a major realignment.
Score: 45 Votes (Like | Disagree)
GeoStructural Avatar
13 months ago
It doesn’t matter how many awards and nominations Apple pays for, the content is just boring, low-stakes, and barely interesting.

The production value is there, and some of the shows are good (Severance, for instance), but it is just not appealing overall. I have had many free trials ranging from 3 months to over 1 year and still have never felt persuaded to pay for it.
Score: 39 Votes (Like | Disagree)
abatabia Avatar
13 months ago
I found a lot of the content repetitive and boring and hard to get into. There are exceptions but too many someone wakes up to find their life has changed type of shows.
Score: 29 Votes (Like | Disagree)
komuh Avatar
13 months ago
Maybe making stuff people want to watch while also stopping overspending on Hollywood cliché shows will bring some viewers to platform.

Why should i waste time of some boring Morning Show while I can watch House of Dragons or other top tier TV show for less money.

*(Maybe just buy HBO for this billions that were spend on crappy Apple shows to capture some viewer-base and let them <HBO> create shows for you was the move. Right now there are like 3/4 TV shows worth watching on Apple TV why should people waste time on boring, repetitive and copy-paste titles?)
Score: 29 Votes (Like | Disagree)
matt_and_187_like_this Avatar
13 months ago
1 show is 1 show. Obviously a limited offering with ultra-expensive shows won’t work. Build your own stars instead of paying ridiculous amounts for seasoned actors who had their prime 20 years ago.
Score: 28 Votes (Like | Disagree)