According to a report from The Information, Apple is losing roughly $1 billion on its streaming content every year. The report suggests that Apple spent roughly $5 billion on streaming in 2019, but has trimmed that number slightly.
The news that Apple is spending more money than it’s making on streaming has some wondering if this is a sustainable business model for the company. After all, most corporations want to make money, and right now, Apple TV+ is doing the opposite.
Apple got into the streaming business precisely because it was the kind of company that didn’t need to make money at it. Apple made more than $390 billion in revenue last year, and that’s presumably including a $1 billion loss on its streaming releases. They simply do not need the money. Here are three other reasons why Apple’s loss of revenue should not be of concern either to the company or the end consumer:
Apple TV+ is good for Apple’s brand
Companies spend money all the time on ways they can improve their reputations. Marketing is, at least in part, an effort to convince people that your brand has some desirable qualities. Apple’s entire streaming venture is an extension of that effort. In producing shows that people want to watch and talk about, they are reminding people both that Apple is a brand associated with quality and that they do more than just make phones and computers. Apple TV+ helps extend Apple into more of your life, and in doing so, it encourages people to think of Apple as a company with interesting ideas in multiple spaces.
They make good shows and movies
Part of the reason Apple TV+ is good for Apple’s brand is that the shows and movies the company produces are, for the most part, pretty good. They certainly have a higher batting average than a company like Netflix, which makes far more stuff, but doesn’t seem to care very much whether the stuff they make is good or interesting. Apple, by contrast, feels a little bit more like HBO, a brand that cares a great deal about quality.
And so, although they haven’t produced a ton of shows, they’ve given us things like Ted Lasso, Severance, Silo, and Killers of the Flower Moon, all fairly expensive pieces of art that another studio might not have greenlit.
We shouldn’t care if these companies make money
Perhaps more important than whether Apple TV+ is good for Apple’s brand, though, is the simple fact that is Apple feels like it’s worthwhile for them to invet in creating interesting TV shows and movies, the average person should not be all that worried about whether it’s making them money. MGM’s motto was once “art for art’s sake,” and while that was always at least a little bit of salesmanship, it’s a worthwhile goal.
If you’re happy with the movies and shows that have come out of Apple, then you don’t need to worry about whether those shows and movies are helping the company’s bottom line. Apple has given no indication that it plans to step away from making these shows, and those of who watch them should just sit back and enjoy the content we’re getting. Not everything has to be about profit and losses.
