Is Apple’s Spending on TV+ Content a ‘Loss’ or a ‘Cost’?
Jill Goldsmith, Deadline: Apple is losing more than $1 billion a year on streamer Apple TV+, according to a report in the Information that cited two people familiar with the matter. The tech giant has spent over $5 billion a year on content since launching Apple TV+ in 2019 but trimmed that by about $500 million last year, the report said. The headline on Wayne Ma’s report at The Information set the framework: “Apple Streaming Losses Top $1 Billion a Year” — the story got picked up widely, and almost everyone who did framed it in terms of losing or a loss. But is it a loss when Apple expected the business to be unprofitable for a decade or more? From Scharon Harding’s paraphrasing at Ars Technica of Ma’s paywalled report: Apple TV+ being Apple’s only service not turning a profit isn’t good, but it’s also expected. Like other streaming services, Apple TV+ wasn’t expected to be profitable until years after its launch. An Apple TV+ employee that The Information said reviewed the streaming service’s business plan said Apple TV+ is expected to lose $15 billion to $20 billion during its first 10 years. For comparison, Disney’s direct-to-consumer streaming business had operating losses of $11.4 billion between the launch of Disney+ in fall 2020 and April 2024. Disney’s streaming business became profitable for the first time in its fiscal quarter ending on June 29, 2024. The above two paragraphs of essential context are buried 13 paragraphs down. If Apple expected TV+ to operate in the red, to the tune of $15–20 billion over its first decade, and halfway through that decade (TV+ debuted in November 2019) it operated in the red to the tune of $1 billion for the year — doesn’t that mean costs are exactly in line with their expectations? The insinuation here is that Apple’s pissing this money away and doesn’t know what they’re doing. Maybe they are! But if so it was exactly Eddy Cue and Tim Cook’s strategy to piss this money away. If Apple had expected TV+ to be profitable or break-even in 2024, then a $1 billion operating loss would be a story. But as it stands it’s just a cost. How much did Apple “lose” on electricity bills last year? ★
Jill Goldsmith, Deadline:
Apple is losing more than $1 billion a year on streamer Apple TV+, according to a report in the Information that cited two people familiar with the matter. The tech giant has spent over $5 billion a year on content since launching Apple TV+ in 2019 but trimmed that by about $500 million last year, the report said.
The headline on Wayne Ma’s report at The Information set the framework: “Apple Streaming Losses Top $1 Billion a Year” — the story got picked up widely, and almost everyone who did framed it in terms of losing or a loss. But is it a loss when Apple expected the business to be unprofitable for a decade or more? From Scharon Harding’s paraphrasing at Ars Technica of Ma’s paywalled report:
Apple TV+ being Apple’s only service not turning a profit isn’t good, but it’s also expected. Like other streaming services, Apple TV+ wasn’t expected to be profitable until years after its launch. An Apple TV+ employee that The Information said reviewed the streaming service’s business plan said Apple TV+ is expected to lose $15 billion to $20 billion during its first 10 years.
For comparison, Disney’s direct-to-consumer streaming business had operating losses of $11.4 billion between the launch of Disney+ in fall 2020 and April 2024. Disney’s streaming business became profitable for the first time in its fiscal quarter ending on June 29, 2024.
The above two paragraphs of essential context are buried 13 paragraphs down. If Apple expected TV+ to operate in the red, to the tune of $15–20 billion over its first decade, and halfway through that decade (TV+ debuted in November 2019) it operated in the red to the tune of $1 billion for the year — doesn’t that mean costs are exactly in line with their expectations?
The insinuation here is that Apple’s pissing this money away and doesn’t know what they’re doing. Maybe they are! But if so it was exactly Eddy Cue and Tim Cook’s strategy to piss this money away. If Apple had expected TV+ to be profitable or break-even in 2024, then a $1 billion operating loss would be a story. But as it stands it’s just a cost. How much did Apple “lose” on electricity bills last year?
