Apple Inc. intends to spend about $1 billion on programming in the next 12 months, intensifying efforts to compete with Amazon.com Inc. and Netflix Inc. in video streaming, according to individuals knowledgeable about the plan.
A new Los Angeles-based team, headed by former Sony Corp. television executives Jamie Erlicht and Zack Van Amburg, who have been hired in June, will create and purchase television shows and movies such as Apple Music and other future video streaming products, said the people, who asked not to be identified because the plans are personal. Before 10, the budget was reported by the Wall Street Journal. An Apple spokesman declined to comment.
Apple has accelerated its push to video within the year as it attempts to double revenue from its services business, which includes products like the App Store and Apple Music by 2020. It introduced the reality shows ‘Planet of the Programs’ in June and ‘Carpool Karaoke’ . Executive Jimmy Iovine told Bloomberg News in April that Apple would launch as many as 10 shows by the year’s end.
While represents an increase it’s significantly less by Amazon and Netflix for content that is original. Netflix has said it will spend $6 billion on programming this season, and JPMorgan Chase amp; Co. analysts estimate Amazon’s cost will run about $4.5 billion.
Apple has also hired Matt Cherniss, who until recently was president of Tribune Media Co.’s WGN America cable network, to head development. Cherniss reports to Van and Erlicht Amburg, who in turn report to Apple services Eddy Cue. The group is currently hiring one of the people said.