Key Takeaways
- Apple TV+ may introduce an ad-supported tier to boost profitability.
- The advertising-related negotiations are said to have taken place in the United States and the United Kingdom.
- No release date has been set, but it could theoretically be announced as soon as September.
The Telegraph reports that Apple is close to offering an ad-supported Apple TV+, with executives reportedly in talks with the UK’s Broadcast Audience Research Board (BAB) about the technology needed to track ads. BARB is best known for providing viewing statistics for the UK’s four biggest broadcast networks (BBC, ITV, Channel 4 and Sky) and already provides Apple with similar streaming data.
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Until now, Apple has only inserted ads into live sports broadcasts like Major League Soccer, but the company is believed to be in talks with ad networks in 2022 to help offset costs after spending more than $20 billion so far on programming to keep up with rivals like Netflix and Amazon, according to AppleInsider. Despite being a relative newcomer to the film and TV show space, Apple once had a reputation as one of the most money-hungry content creators.
It’s unclear when the ad-based Apple TV+ plan will launch, or even that Apple will start inserting ads into shows and movies. The earliest an announcement could come is in September, when Apple holds its usual iPhone-focused fall press event. New iPhone buyers may be more likely to stick with Apple TV+ after the initial trial period ends.
Why is Apple only now starting to show ads?
The streaming industry as a whole has abandoned its early approach of relying on (relatively) low fees to build a large subscriber base. The cost of high-budget television programming has made that approach unsustainable, leading to price increases in some cases and the introduction of ad-supported tiers in others. Even Netflix and Disney+ are jumping on the advertising bandwagon, despite being hugely popular “premium” services.
Apple is holding on not only because it has billions of dollars in cash reserves, but also because Apple TV+ is a way for the company to spice up its ecosystem: People who buy new Apple products often qualify for three months of the service for free, and it’s the centerpiece of the company’s Apple One omni-subscription.
