Jan 3, 2020 - Economy

Apple bets big on Tinseltown's top talent

Richard Plepler Photo: Gary Gershoff/FilmMagic, Oprah Winfrey Photo: Steve Granitz/WireImage, Reese Witherspoon: Taylor Hill/Getty Images

Apple's new streaming service is only beginning to take shape, but already the tech giant has signaled that it's willing to spend big to lure Hollywood's top talent to be a part of it.

Why it matters: Analysts have for years predicted that Apple, with lots of free cash flow, would one day buy a content company like Netflix or HBO to fulfill its streaming ambitions. But Apple's recent investments in individual producers, actors and directors suggest the Silicon Valley titan is heading in a different direction.

Driving the news: Former HBO boss Richard Plepler has secured a five-year exclusive deal with Apple to produce feature films, documentaries and original series for Apple TV+, his spokesperson confirmed to Axios on Thursday.

  • Apple TV+ will be the exclusive home to all of the programs from Plepler's newly-formed boutique production company, Eden Productions, based in New York.

Between the lines: The deal, which was first reported by The New York Times, brings authority to Apple's fledgling content efforts and gives Plepler a powerful platform to wield his influence as a top producer and talent magnet.

  • "This is a watershed moment for Apple — aligning with Plepler and team make it abundantly clear just how serious AppleTV+’s ambitions are," says veteran media analyst Rich Greenfield, a partner at LightShed Partners.

Be smart: Unlike some of its streaming competitors, Apple TV+ is being built almost exclusively for original content. Its smaller, more focused catalog is starting to look attractive to Hollywood A-listers, who worry about their work getting lost in the shuffle of mega-libraries at Netflix, Amazon, or HBO Max.

  • “I thought that Apple was the right idea very quickly, just because it was embryonic enough that I thought maybe, you know, I could make a little contribution there,” Plepler told The Times.

The big picture: Plepler's partnership with Apple signals a new era for Hollywood brass, in which they're becoming attractive content creation and distribution partners for tech companies with deep pockets.

  • Companies like Amazon and Netflix have notably opted to spend hundreds of millions of dollars luring top talent from traditional studios to produce content for their streaming services, instead of buying the content companies outright.

Yes, but: It's still very early, but Apple's big investments have yet to turn into major commercial successes.

  • The first major television show for Apple TV+, "The Morning Show," received mixed reviews, despite its all-star cast, which included Reese Witherspoon, Jennifer Aniston and Steve Carell.
  • Reviews of the service overall suggest that Apple's investments in other programming from Oprah, as well as "Sesame Street" and "Peanuts" spinoffs, haven't helped the company establish a clear vision for the service yet.

What's next: It's still to be seen whether Apple's other big-time investments in Hollywood honchos will pay off.

  • Steven Spielberg's highly-anticipated reboot of the popular 1980s anthology series “Amazing Stories” has yet to debut on Apple TV+.
  • "The Morning Show" is one of three exclusive projects for Apple from Witherspoon's acclaimed production company Hello Sunshine. The other two, along with a slew of projects from big names like J.J. Abrams and Chris Evans, have yet to debut.

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