Comedian Ben Stiller’s mind-bending trip Severance celebrated its second season finale on Apple TV+ on Thursday, and the actor-director-producer already has plans for more.
Apple CEO Tim Cook just pledged to renew it after it eclipsed Ted Lasso to become the streaming service’s most-watched series. But Apple+ reportedly remains a money loser whose fate depends on the benevolence of Cook.
According to The Information, Apple is fueling its ambitions to compete with industry leader Netflix to the tune of over $5 billion in spending since its launch in 2019, resulting in per annum losses north of $1 billion to keep pumping out content.
The report added it had about 45 million users, though it is not clear how many of which are paying subscribers spending either $9.99 monthly or $99.99 annually versus those accessing it via a bundle like Comcast’s StreamSaver.
Unlike other streaming services like Disney+ and Warner Bros. Discovery’s MAX that have licensed movies and television shows, Apple TV+ is unique in that it almost exclusively offers viewers original content produced by the Cupertino computer company.
The report by The Information highlights how only a handful of companies credibly possess the financial firepower to take on Netflix in the cutthroat streaming wars. It’s hard for many tech companies to keep up with Amazon splurging $1 billion to produce the critically-panned and poorly received “Lord of the Rings” series, The Rings of Power, let alone a struggling legacy media company like Paramount.
The costs to fund Apple TV+ are a drop in the bucket for a company hauling in close to $100 billion in annual profits from the sale of iPhones as well as its cut of transactions conducted via third-party apps on iOS.
Due to ballooning budgets and declining box-office takes from previously must-see tentpoles, like the fourth Captain America outing, Disney has repeatedly been cited as a potential takeover candidate for Apple. Cook’s company could benefit from its library of content and Disney-owned franchises.
Current trends suggest consumers are feeling the pinch from the current cost-of-living crisis and are just as unwilling to splash out money on overpriced movie tickets as they are to pay for yet another streaming service.
UK-based Ampere Analysis expects this year more viewers will seek out super bundles that give them greater access to a combined number of TV and movie libraries without paying full price. This includes StreamSaver, which includes Apple TV+, Netflix and Peacock, as well as a discounted offer that combines Disney+, Hulu and Max.
This story was originally featured on Fortune.com
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