Apple, long known for its deep pockets and aggressive expansion into Hollywood, is now pulling back on its once-unrestricted spending in the entertainment industry. After investing over $20 billion into original content that has yet to significantly impact the streaming landscape, the tech giant is taking a more disciplined approach to its film and television projects.
Reining in the Budget
According to sources close to the company, Apple’s senior executives, including services chief Eddy Cue, have been holding regular meetings with Zack Van Amburg and Jamie Erlicht, the former Sony TV executives who oversee Apple TV+. The goal? To curb runaway costs and exert greater control over production budgets.
Unlike Netflix, which buys the most content overall, Apple has gained a reputation for lavish spending on individual projects. The studio shelled out more than $500 million on movies directed by Martin Scorsese, Ridley Scott, and Matthew Vaughn, while the World War II miniseries Masters of the Air cost upwards of $250 million. Despite the high price tags, many of these productions underperformed, both in box office returns and streaming viewership.
A Measured Approach to Growth
Apple TV+ currently holds just 0.2% of total TV viewership in the U.S., generating less engagement in a month than Netflix does in a single day. The low audience share, coupled with sluggish subscriber growth, has prompted Apple to rethink its strategy.
“Subscriber growth has been weak, with the platform’s original content a fraction of what rivals offer,” noted Bloomberg Intelligence analysts Geetha Ranganathan and Kevin Near. Apple, which has largely escaped the financial scrutiny faced by competitors like Disney and Warner Bros. Discovery, is now looking for ways to ensure its Hollywood ventures are more financially sustainable.
A New Strategy for Apple TV+
Going forward, Apple is focusing on several cost-cutting measures, including:
- Paying less upfront for productions while shifting more financial responsibility to external studios.
- Quicker cancellations for underperforming shows.
- Licensing more content from third-party studios instead of relying solely on expensive in-house productions.
- Rethinking star-driven deals, particularly as actor salaries continue to rise.
One of the biggest tests for Apple’s new approach will be the upcoming seasons of high-profile series like Severance and Foundation, both of which have been renewed but will be subject to tighter budget constraints.
Hollywood’s Talent-Friendly Studio Faces Reality
When Apple entered the streaming wars in 2019, it positioned itself as a creator-friendly studio willing to fund passion projects with minimal interference. Deals with A-list talent—including Oprah Winfrey, Steven Spielberg, and Reese Witherspoon—helped the company attract top-tier projects.
However, the days of unlimited spending may be coming to an end. Apple TV+ now faces the same financial realities as its competitors, forcing the company to balance artistic ambition with economic practicality.
Whether these new budgetary restrictions will improve Apple’s market position remains to be seen. But one thing is certain: the era of unchecked Hollywood spending is over, and even Apple isn’t immune to the changing tides of the streaming industry.
Source: Bloomberg