Why I think Apple won't make it in TV - and why I could be wrong

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Can Apple's TV strategy work?

Apple turned on the star power recently with the announcement of the new Apple TV+ streaming platform. They introduced the likes of Steven Spielberg, Reece Witherspoon, Jennifer Aniston, Steve Carell, and even Oprah Winfrey all of whom are making films and shows for the platform.

It would seem that rather than try and develop a Netflix streaming competitor Apple want their little black TV box to be the infrastructure from which you get TV.

So, this isn't the Netflix-killer some had predicted. But will this approach work? I'm not convinced… and here's why.

The competition

Netflix has more than two decades head-start in this space and with close to 150 Million paying subscribers Apple has a lot of catching up to do. Not only that but Amazon are becoming a major player in this space and are set to spend $4.5bn this year on original content (compared with Apple's $1bn budget). Alongside this, Disney is finalising the acquisition of 20th Century Fox ahead of the launch of the much-hyped Disney+ later this year. The streaming space is quickly becoming oversaturated.

I'd be surprised if we didn't see some consolidation in this space over the next two or three years but without a deep library to rely on Apple are walking from a standing start.

With so many options for viewers, it's hard to see if one-off star-studded projects will be enough to convert people long-term to commit to Apple TV+. The Cupertino giant is betting on viewings cutting the cord and believing that Apple TV+ is the best way for them to access an array of content. That's a pretty hefty bet at this stage.

The experience

Apple TV+ will not be a standalone app. Instead, it will be baked into the existing Apple TV app available on iOS devices and an array of smart TVs and connected devices.

In some ways, this is smart as you can launch on every iOS mobile, tablet and computer as well as to anyone who has or buys an Apple TV+ box (and that's potentially a big audience). In another way, it's extremely dum. As a tab within an existing app, will Apple TV+ feel like a rich enough experience? This is not the first time Apple has come against this. There were issues in 2015 when they launched Apple Music, and the once heralded iTunes has now been superseded by the likes of Spotify in terms of user experience.

Beyond the user experience, Apple has another, bigger, cultural issue. By only making Apple TV+ available on iOS devices they have restricted the potential audience for shows and for creators to find an audience for their content. Apple only has 15.8% market share (as of Q4 2018) of the world's mobile devices.

As an Android mobile user, I find it crazy that Apple would restrict themselves in this way. If I want to watch Netflix content I can do on any device, at any time. That frictionless viewing experience makes it easy for me to watch content on the go and continue to binge my new favourite show wherever I am. Apple is assuming that either I want to sit at home and watch content through my TV (an occurrence that happens less and less in my house) or that I'll only own Apple devices and can, therefore, watch on the go. It’s archaic to think that the platform with which you view your content is more important than the ease with which you can view.

This is in stark contrast to Google's Stadia games announcement last week, in which they demonstrated how easily gamers will be able to move from one device to another in a completely frictionless gaming experience. That's a power play in a world of multiple devices and operating systems.

Controlling creativity

Apple has gone from the scrappy upstart to ubiquitous technology behemoth and along the way they have lost some of their 'cool'.

What seems interesting is their dated approach to tackling TV production  -  leaning on glitzy established stars and blockbuster directors. This feels reminiscent of when the company saddled-up to U2 and unceremoniously dumped their new album on millions of the world's mobile devices (a very uncool thing to do!). Of course, Netflix-bashing technophobe Steven Spielberg was going to be involved, announcing an anthology of films for the platform. Contrast that with Netflix giving showrunners such as the Duffer Brothers the space to make Stranger Things, Brit Marling license to make sci-fi drama The OA (and commission a second series), support controversial teen suicide drama 13 Reasons Why, and giving actor Brie Larson the chance to make her Directorial debut, Unicorn Store.

Will Apple allow talent like Damien Chazelle and Kumail Nanjiani the space to make the shows they want to. Not according to early reports, as featured in a recent New York Times article. Interviews with several people close to event "suggest that, while the producers and stars appreciate having another deep-pocketed company to pitch, they also have … well, let's call them concerns."

Not only that but will creatives be happy with having their content restricted to the elite few who own an expensive Apple device. If you can make a show, with creative freedom for Netflix or Amazon and reach almost anyone in the world then why would you choose to make it with Apple?

Why I could be wrong

It's taken Apple time but they are starting to get it right in music. The Wall Street Journal reported last year that growth in the US for Apple Music was twice that of Spotify and it was set to overtake the Swedish service in late summer last year. Worldwide though Spotify reportedly have more than 70 million paid subscribers while Apple only has around 36 million, so it still has ground to make-up.

The legacy of the iPod, iTunes and more recently Apple Music and the brand's close relationship with some of the music-world's biggest stars will give Hollywood the feeling they are in good hands, something Netflix has had to earn over time and something Amazon is still potentially struggle with.

Not only that but the hiring of two ex-Sony execs who brought the studio success with the likes of The Crown and Breaking Bad is sure to give talent the sense that Apple means business. The Cupertino giant’s budget is dwarfed by Netflix, who is set to spend more than 8x the $1bn Apple has set aside for production. But tasked with finding just 10 shows for that price shows Apple is looking to take a quality over quantity approach, which could serve them well (and be a threat to the likes of HBO) in the long-run.

Apple has filled their roster with experienced talent with the aim of mitigating risk in an unpredictable world of TV hit-making, much in the same way they did by having legendary music producer Jimmy Iovine run Apple Music, and bringing in respected Radio1 Presenter Zane Lowe to front Beats 1. The company has a lofty view of its position and its mission. It's not just about making TV shows. Instead, Eddy Cue, Apple's Senior VP of Software and Services, argues,

"We are trying to create culture."

From a consumer perspective, Apple has both a loyal and dedicated (if not diminishing) following who are deeply baked-in to the companies ecosystem. They have the ability to leverage a broad entertainment and news offering over time, covering TV, film, music, games, news and magazines, something even Disney can't can't compete with.

This launch feels like a first attempt at bringing together everything Apple has done to-date in entertainment. Perhaps one day we'll all have a little black box filled with the world's best entertainment delivered to us by the curators of culture at Apple…I just wouldn't bet on it too fast!

Tom Jarvis is founder and managing director of Wilderness

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