ACTION

Apple may produce original Hollywood content—here’s why that would be a great move

Obsession
Glass
Obsession
Glass

Apple could be going to Hollywood.

The company has “held preliminary conversations in recent weeks” with executives there to “suss out their interest in spearheading efforts to produce entertainment content,” Variety reports. Other sources “described the company’s exploration as more of a flirtation,” the publication notes, adding that Apple also made a bid for the hosts of the automotive show “Top Gear” when they left the BBC earlier this year.

Such a move would be a shift for Apple in the entertainment business. So far, it has sold or rented access to shows from other networks and studios via its iTunes store. And it has provided software platforms for companies to distribute content on devices such as the iPhone and Apple TV streaming-media box, both of which are due for updates next week at an event in San Francisco.

But considering the Hollywood landscape, this seems like a smart idea to at least try.

Television networks are increasingly realizing that streaming services are at odds with their fading business models of cable subscription fees and large-scale brand advertising. As a result, they’re unlikely to bend to Apple’s requests to partner up. Note the company’s struggles trying to get buy-in for a reported streaming TV service, which has been in the works for years and still isn’t ready.

Meanwhile, exclusive content has been hugely successful for other streaming video providers, most notably Netflix and Amazon, but also HBO, which just launched a streaming-only version of its premium TV service.

“We are making great progress shifting to exclusive content and expanding our original content, which differentiates our service, drives enjoyment for existing members and helps motivate consumers to join Netflix,” the company’s chief executive Reed Hastings wrote in his latest letter to shareholders (pdf). Netflix’s spending on original content could approach $5 billion in 2016. (This leads to an obvious question: Why doesn’t Apple, which has the money, just buy Netflix? Too much, too fast?)

Apple has also seen the benefits of producing original “content” for other platforms for years, albeit in very different formats.

Apple’s free and premium collections of Mac software, including Photos, iMovie, and Final Cut Pro, have surely boosted Mac sales and satisfaction. It has long produced its own product-launch keynote events, including original video, which have become priceless marketing tools. It even commissioned a Texas Hold’em poker game to launch the original iPhone App Store in 2008. More recently, Apple is hoping an original streaming radio station, Beats1, will help drive adoption of its new music service.

And, lastly, there’s the hope that Apple—which generally has excellent institutional taste, from product design to ads—could produce some truly incredible, entertaining content.

The downside, of course, is adding complexity to an operation and losing focus. Apple already has enough to do, and already doesn’t do everything perfectly or ahead of schedule. In the past, it has kept itself focused by building platforms for others to use for the unpredictable, often-unrewarding job of creating and distributing content.

But if Apple wants to win the living room with its new TV platform, original or exclusive content may become an inevitability.

“Catalog and licensing isn’t enough,” long-time digital media executive Jason Hirschhorn, who has worked at MTV, Sling, and MySpace, tweeted. “Which show/talent. No idea.” he continued, adding that Jon Stewart, who recently left “The Daily Show” at Comedy Central “would not shock” him. “Everyone is siding up and they are no exception.”

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