Andrew Wallenstein, writing for Variety:
The scale of Apple’s ambitions vary depending on whom is asked, but one high-level executive who talked with the company said the goal is to create development and production divisions that would churn out long-form content to stream in a bid to compete with Netflix. Apple is hoping to put a headhunting firm on those hires in the coming months, according to source, with the goal of being in operation next year. Unknown is whether the focus is on TV series, movies — or both.
Other sources described the company’s exploration as more of a flirtation, though one pointed to a recent sign that an escalation of interest is clear: Apple is said to have made an unprecedented bid to secure the stars of “Top Gear” when they exited their BBC series earlier this year. But Amazon ended up winning the bidding war for Jeremy Clarkson, James May and Richard Hammond in July.
The traditional content production model, where short form content is created by the networks and long form comes from the movie studios, is being deconstructed. What started with Netflix and HBO is now spreading like wildfire. Other cable channels are creating short form, with shows like Louie, Mad Men, Humans, and the like.
Replaying movies, long a staple of the cable bundle, is starting to lose its luster. There is just too much shiny new content to compete with the mediocre B-movies that flood the cable channels. Netflix just dropped its deal with Epix, showing its preference for new content over old movies (though that deal was quickly picked up by Hulu).
Apple wants to get into the biz, so they’ll need their own original shiny content. It just makes sense. Exploration or flirtation, this seems a smart, and necessary, business move.
Hell, if Amazon can do it…
“but one high-level executive who talked with the company said the goal is to create development and production divisions that would churn out long-form content to stream in a bid to compete with Netflix.”
I got a vision problem with that, I just don’t see it. Katie Cotton may be gone, but like Fight Club, the first rule of talks with Apple is that you do not talk about talks with Apple. Beyond that, when is Apple ever out-bid on something it really wants? Cough—Rockstar—cough.
Finally, Apple doesn’t have to get into the production business. It’s got enough cash to buy any pilot or bankroll any option it wants to. There are lots of independent production companies out there. If anything, it’s now a viable business model in entertainment industry to shop your package, as an exclusive, to any one of the deep-pocketed technology companies that are desperate for differentiating content. Hell, if you look at Netflix’s Lillyhammer, you can even count the Europeans in. It’s only a matter of time before someone’s buying South and East Asian as well as Latin American content.
Funding an external production group to produce independent content still takes creative decision-making, no?
Historically, the less the better.
Granted some executives have been extraordinarily good at “creative decision-making” but I’d make the point that they’re really creative-types making business decisions than business-types making creative decisions.
We’re all very lucky, we’ve got ring-side seats to the biggest disruption to the entertainment industry since talkies. Not only are we seeing the type of changes to the content development process mentioned here, we’re also seeing an upending to the releasing cycle (has the OED added “binge-watching” yet?). The next step is a move away from the standard episodic 22 minute sit-com and 47 minute drama. Pretty soon I think we’ll see an abandonment (in the US at least) of the 100-episode syndication threshold, and an adoption of the UK approach of 6-9 episode “series” that can stand alone or be added to as funding and/or ratings allow. This will also have a multiplier effect as “talent” no longer has to commit to a months-long daily shooting schedule that only permits other projects during short hiatuses. What movies and TV look like in 10 years will be very surprising.
In other words, why buy a dairy and learn to be a farmer, when you can just pay the farmer for his milk, cream, and yogurt and sell it in your chain of stores you already own and manage extremely well?
I’m including simply making a choice of which independent producer to hand a check to, not trying to participate in the creation of the product itself.
Apple doesn’t need to pay to create new content when they can control the distribution channel. With FCPX’s ability to upload directly to every Apple TV (just like Logic can upload to iTunes) Apple could become the middle man (with a 30% cut) for every independent producer who wants their movies available right beside the big studio films on iTunes and Apple TV.