Apple will become a major player in Hollywood by spending $1 billion on original TV shows and movies

Apple Carpool KaraokeAppleApple CEO Tim Cook on ‘Carpool Karaoke’

After poaching two TV veterans in June to run its TV and movie business, Apple is ready to drop $US1 billion in the next year to make original content, according to a new report from The Wall Street Journal.

That makes Apple a real player in Hollywood, something the town has been anticipating ever since Netflix and Amazon crashed into the market with big budgets.

Apple’s $US1 billion is about half of what HBO spends on programming (about $US2 billion in 2016, and a “couple billion dollars” this year). Earlier this year, JPMorgan estimated that Amazon would spend $US4.5 billion on video in 2017, though we don’t have an official number. And Netflix content chief Ted Sarandos said recently that Netflix will spend about $US7 billion next year for content.

The Journal says this $US1 billion could go to fund “as many as 10 television shows.” And it will likely include at least a few prestige shows, in the vein of Netflix’s “House of Cards,” to start former Sony execs Jamie Erlicht and Zack Van Amburg’s reign off with a bang.

Apple and Hollywood

Apple’s road to Hollywood has been rocky so far. Apple’s plans to get a TV package off the ground were stymied for years, partially because of Apple’s hard-nosed negotiating strategy, former Apple employees told Business Insider.

After acquiring Beats and launching Apple Music, Apple dipped its toe in the TV waters by producing a few original programs for the service. They weren’t a runaway success. “Planet of the Apps,” an app-focused version of “Shark Tank” with celebrity mentors like Jessica Alba and Will.i.am, was mocked by critics. And Apple’s “Carpool Karaoke” spinoff was delayed for months for unspecified reasons, before debuting this month.

Apple’s upcoming series helmed by Dr. Dre, “Vital Signs,” a semi-autobiographical scripted series about his life, is nowhere to been. Production began in February 2016, and there were subsequent reshoots, people familiar with the production told Business Insider.

But that era lacked a cohesive strategy, with various Apple execs involved in shows on a case-by-case basis, according to insiders.

Now it’s Erlicht and Van Amburg’s turn, and they have $US1 billion to play with.

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