Tim Cook’s team at Apple, worth $2 trillion, continues to keep the media industry in suspense
Ever since Apple launched its digital media player, the Apple TV, in 2007, the media and entertainment industry has struggled to question some of the tech giant’s peripheral moves and ambitions. After turning the global music market upside down with the launch of iTunes back in 2001, many expected Apple to do the same in the entertainment world.
The future of television – it was said at the time – lay in apps. Companies like Apple and later Google would make them available to us on their competing iOS and Android platforms.
While these developments helped usher in the age of connected television, other factors also played a role – the most important of which was the decision by cable and satellite broadcasters to embrace digital platforms after cable cutting passed a tipping point and viewers went online .
As recently as 2007, it was almost unimaginable that Silicon Valley tech-bro barbarians would one day kick down the golden gates of Hollywood and storm the pampered citadels of television networks.
But 2007 was also the year Netflix transitioned from a DVD rental company to a content-streaming company – and has since grown exponentially, now boasting over 222 million paying subscribers.
With its fourth-generation Apple TV, the Cupertino-headquartered company took another 12 years to find its next step in entertainment before launching Apple TV+ in 2019.
Having enjoyed success with both iTunes and its successor, Apple Music (now the second largest music streamer after Spotify), the company needed to come up with a compelling business case to get customers to subscribe to a new streaming service.
However, as the company found out, the content creation business is costly.
Last year, Apple spent in the region of $2 billion creating films, documentaries, and series like the Emmy-winning show Teddy Lasso as well as coda and The morning show.
That investment pales in comparison to Netflix, which spent an estimated $14 billion on a variety of content in 2021. Even tech giant Amazon spent around $9 billion in 2021, on top of the $8.5 billion it spent on MGM.
But Apple is always full of surprises, and its announcement last week that it had landed a $2.5 billion broadcast rights deal with US Major League Soccer is a good example.
The deal follows Major League Baseball’s agreement to broadcast Friday night games announced earlier this year. It’s also running the gauntlet against Amazon, which is busy securing similar broadcast deals in basketball, American football, soccer and tennis in countries like the US, UK, Italy, France and Germany – much to the chagrin of traditional media.
Ever since Google and Facebook started selling ads, the same traditional media has harbored suspicions about Big Tech and its ambitions and intentions.
Even if Apple rakes in a tiny amount of ad revenue — less than 0.4 percent, according to some analysts — it could see it as an opportunity in the post-cookie world. While it has trodden this path before with its mobile iAd offering, which ended in 2016, some analysts believe it could easily return to the advertising market and become a serious player.
With a market cap of $2.2 trillion and $73 billion in cash on its balance sheet, Apple can fund pretty much any acquisition it wants, including Disney+, Netflix, or one of the big studios like Lionsgate — steps that can be taken Entertainment and media offering would propel to a whole new level and a much larger audience base.
Notwithstanding possible regulatory challenges, a larger audience within the Apple ecosystem could lead to higher ad revenue.
The reality, however, is that Apple is still overwhelmingly a tech company, and the majority of its $378.3 billion in revenue last year came from flogging iPhones and iPads. That won’t change any time soon.
In the meantime, Apple seems pretty happy about playing a supportive role in the global entertainment and media industries.
The question is how long?
ICAD creatives win prizes
The Public House was the big winner at the annual ICAD Creative Awards held last week. The agency received five gold, four silver and 13 bronze awards – including one for The Indo Daily Podcast.
Other big winners of the night included BBDO Dublin, Publicis Dublin, In the Company of Huskies, Core and TBWA Dublin.
Meanwhile, the Lifetime Achievement Award went to Mike Garner, Creative Director at Core.
Ad Net Zero sets up shop
Following the launch of Ad Net Zero in the UK in 2020, the initiative was launched in Ireland to help the entire marketing communications industry respond to climate change.
Led by the Institute of Advertising Practitioners in Ireland, it also includes the IAB Ireland, the Marketing Institute of Ireland, the Association of Advertisers in Ireland and Commercial Producers of Ireland. Ad Net Zero’s Irish arm will now join the Ad Net Zero Steering Group.
https://www.independent.ie/business/media/tim-cooks-team-at-two-trillion-dollar-apple-continues-to-keep-the-media-sector-guessing-41765039.html Tim Cook’s team at Apple, worth $2 trillion, continues to keep the media industry in suspense