Apple Budgets $1 Billion for Original Programming

Apple Budgets $1 Billion for Original Programming

The river of cash flowing to Hollywood from new content producers is about to swell as Apple plans to spend $1 billion within the next year for its own productions, The Wall Street Journal reports today. On Wednesday, those stocks barely budged.

It seems producing original video content is all the rage in the tech industry these days, with everyone from Facebook to Amazon dabbling in the sphere that used to belong to giant movie studios. For one, its initial foray into original content - "Planet of the Apps" and "Carpool Karaoke" - haven't impressed critics. Despite the significant investment, $1 billion pales in comparison to what competitors Netflix and Amazon intend to spend on content development and acquisition in 2017 - $6 billion and $4.5 billion, respectively. Newly acquired Apple employees Zack Van Amburg and Jamie Erlicht will be in charge of managing the original content budget. To put that in context, HBO spent $2 billion on their original series in 2016, so it's a huge sign of intention from Apple.

This money will be used to help procure and produce as many as 10 television shows. You know, original content, like the stuff that Amazon and Netflix has been putting out for years while Apple focused on their phone. Reports indicate that the company could acquire or produce up to 10 television shows come next year.

Carving out a space in the original programming space could prove hard for Apple.

Also, a new Apple TV set-top box will launch later this year with support for 4K output.

Apple have already made a foray into online streaming services with iMusic, their music streaming subscription service and it looks like they are keen to expand and become the next big Hollywood contender. Whether Apple's video ambitions take off is dependent on whether the company can create content in the same caliber as streaming rivals' originals, that have amassed dedicated fan bases and critical acclaim. This comes as it seeks to double revenue by 2020 from its services business including Apple Music and App Store.