Analyst Gene Munster for venture capital film Loup Ventures has published a report predicting that Apple will grow its investment in original video content from its current $500 million annual to a whopping $4.2 billion annual spend by 2022.
The same report indicates that Amazon will top both Apple and current leader Netflix by the same year, spending $8.3 billion by 2022. Apple though is on the steepest trajectory upward with an annual growth rate of 54% as its subscription music streaming service ‘Apple Music’ will likely be combined with an SVOD service over the next two to three years.
Munster says: “Apple cares about original content because it will grow its services business”. At present services revenue for Apple is 14% of total revenue, but that will likely grow quick in coming years – certainly much faster than hardware sales for iPhones, iMacs and the like.
Using its already established current base of 30 million Apple Music subscribers, a video-powered Apple SVOD service would instantly become the second biggest SVOD service on the block behind only Netflix. It was also likely avoid licensing and syndicating existing content to focus entirely on producing its own original content.