Apple is producing original content that they own, it’s not going anywhere and will produce “value” for them in perpetuity.
And if they’re cash strapped they can sell the license for, say, Ted Lasso to Netflix.
this post was submitted on 20 Mar 2025
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I don't know the latest value but in 2023 Apple had like $162 billion in cash reserves on hand. Burning a billion a year is nothing especially as you say they're just 'art banking' it for the future.
The original article is here, but paywalled:
https://www.theinformation.com/articles/apple-streaming-losses-top-1-billion-year
I'd like to know if this accounts for it being a value-add service for Apple, something additional they can bolt into other services to entice a sale (iCloud bundles, third party subscriptions like T-Mobile service, credit card bonuses) where the company receives bulk backdoor support as part of the partnership.
That's the reason you see Apple and Amazon branching out like this. They aren't intended to be money-makers; they're loss leaders.
That's "look under the couch cushions" money for Apple
I worked for a senior executive at Paramount Pictures from 2015 to 2023 and will confess that we spent a lot of time gaming out scenarios for Apple to buy the studio. It seemed to make a lot of sense. Apple has one foot in Hollywood, a great streaming platform but not much content, and buying a studio would have made them a player along with Disney and Netflix. Buying Paramount would’ve gotten them the Melrose lot, the Paramount+ platform, and the huge library of old movies and TV shows, the IP that is at the heart of the studio’s value. It didn’t seem sustainable for them to continue to have the underpopulated Apple+ and nothing more, they would either have to make a commitment to being in entertainment or shutter the platform and back out, anything else would mean a big hit to their bottom line. And now here it is - they flushed $1B - and yet it still seems very likely that they won’t do anything about it, just take the loss and stay where they are. Very strange.
I have so many questions.
I worked for a major CDN for quite some time, and there was no shortage of divination and reading-of-tea-leaves regarding who was up, who was down, who is surviving and who will get acquired in the content provider space. OTT media was easy money until everyone rolled out multi-cdn solutions and started putting the screws to each vendor for better prices. It was brutal, but I learned a lot about business watching it happen.
How much of all that AAPL buyout discussion do you think was 100% hopium? Sure Paramount had assets and means, but why would Apple want to acquire that and not rent it? Let studios claw at each others heels to produce viable content while AAPL sits back and pays a premium to choose the best bargain. Apple+ was never interested in being #1; the service is just table stakes at their scale (like Paramount Plus one might argue). AAPL’s business is manufacturing lifestyle products and hype. How was Paramount expecting their acquisition to bolster those pillars?
What was your vantage of the Ugly Sonic debacle (circa 2019)?
What did other execs have to say about Mother! (2017)? It was a beautiful disaster and I loved it, but it couldn’t have had many fans internally.
This CBS/Viacom tug of war had to be brutal as well, but the entire enterprise seems to be all under the Paramount umbrella now. Any regrets?
I am sure they will be going broke in like never.