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Apple TV+ Programming Doesn’t Have Ads. How Long Will That Last? – IndieWire


Oct 13, 2022 3:30 pm
@tonymaglio
Jason Sudeikis in “Ted Lasso”
Colin Hutton / Apple TV+
Apple TV+ soon will be the lone major streaming service with no advertising on its entertainment programming. It will, right?
A Wednesday Digiday report suggested that an Apple TV+ AVOD (ad-supported video on demand) tier may “quietly” be in the works. Apple has held “exploratory” talks with executives in the media space, they wrote, touting what the publication described as “an unusual approach to selling ad time.”
The whole Digiday story is what’s highly unusual here, one source close to Apple told Indiewire. While Apple TV has ads on its live sports content — the pacing of major sports contests are built around commercial breaks — ads are not coming to other programming, the person said. Apple TV has an existing “Friday Night Baseball” deal with Major League Baseball; in June, the iPhone maker signed a 10-year pact to stream every single Major League Soccer game through 2032.

The Apple TV app’s standalone MLS service will launch in conjunction with the start of the new pro-soccer season in February 2023. A selection of games will be made available in front of a paywall; most will exist behind it. To this point, all “Friday Night Baseball” games have been free. Digiday wrote that Apple TV’s new advertising product is expected to launch in “early 2023” — just like the soccer service. MLB regular-season games begin in late March.

Let’s assume the ads remain strictly on sports programming, which may or may not include studio shows within the MLS service (or future apps that are not technically Apple TV+ proper). With the imminent launch of ad-supported tiers from both Disney+ and Netflix, Apple’s core streaming service, which costs just $4.99 per month, will be the final SVOD-only holdout.
Until recently, the streaming industry was all about subscription fees and (almost) all streamers were against commercial interruptions — and then Netflix lost subs in the first quarter of 2022 (and then again in Q2). Once the famously anti-commercial Netflix folded (HBO Max started adding ads in June 2021), all bets were off. (Find details about Netflix AVOD, formally called “Basic with Ads,” here.)
Netflix needed the additional revenue stream — Apple really does not. With a current market cap of $2.3 trillion, Apple is in the literally the largest company in the world. It makes its money with device sales; streaming is a mere add-on service for the tech giant, somewhere between a hobby and a write-off. In other words, Apple would take the ad dollars — as it does with billions in sales revenue inside the App Store and on Apple News — but it doesn’t need them.
A final Digiday source said they recently spoke with Apple’s VP of ad platforms, Todd Teresi, about opportunities to advertise on sports programming. “The discussion didn’t address an ad-supported tier on Apple TV,” Digiday wrote. However, the two have plans for a follow-up conversation next month, and the executive thinks an Apple TV+ AVOD (ad-supported video on-demand) tier “could come up then.”

Or Apple will just search its Cupertino, California headquarter’s couch cushions for the (relative) chump change.
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