Apple reportedly approaching film studios to partner on movie releases
Yahoo Finance entertainment reporter Allie Canal discusses a report on Apple reportedly partnering with studios to release movies, their $1B budget on films, and what this could mean for ticket sales, theaters, and streaming.
SEANA SMITH: Apple may be moving some of its content to the big screen. A new report from Bloomberg saying that the tech giant is committing $1 bilion to multiple theatrical releases and also is going to raise, looking and raise the profile of its Apple TV streaming service. Yahoo Finance's Allie Canal joining us now with more. Allie, this has the potential to be massive.
ALLIE CANAL: Massive. Billion commitment here from Apple. According to this report, they are already in talks with potential studios to roll out some of these films for theaters. And really, this is a play for them to get some clout in the game, to really be taken seriously in Hollywood and within the streaming world.
They have said that the ideal plan would be to roll out these titles and thousands of theaters for at least a month. And that is a strategy that's differed from what we've seen in the past with streaming exclusives and more limited theatrical releases. Now, this could all change. It's all based on reporting. Apple did not immediately get back to me on a request for comment. But it is a massive for the theatrical industry. And that's why we saw some big theater chains, like IMAX, AMC, Cinemark, all closing higher today on this news.
And it's not just Apple with this billion dollar commitment, because Amazon did it first, at least according to a separate Bloomberg report. Amazon, which did purchase MGM earlier last year, also plans to invest $1 billion to produce 12 to 15 movies exclusively for theaters. And this combo-ed with Apple could help the industry get back to those pre-pandemic levels at a faster pace.
According to initial analyst reaction, there's an estimated 20% boost to the box office that could happen as a result of both Apple and Amazon leaning into the theatrical. Currently, ticket sales are about 30% below where they were in 2019. So huge for theaters. And it could also up the ante for a company like Netflix, which has been very resistant to embracing that theatrical release.
DAVE BRIGGS: We've been watching all day the Netflix stock pop. And everyone's been trying to figure out why. Maybe there's some sort of--
ALLIE CANAL: Maybe they think this could--
DAVE BRIGGS: --trickle down to Netflix. AMC up-- is up 3%. And I think that is clearly on this news. I think this is such great news from a content standpoint, because every blockbuster movie is-- Marvel-- is part 5, part 6 of creed. And what we saw with Amazon out of the gate is this "Air" movie that comes out in a couple of weeks. That is like the movies that used to be made, great storytelling.
And look at what Apple has done, Ted Lasso, the best show on TV shrinking. Like, it makes me feel like storytelling my return to the movie theaters. That's just my little soapbox rant. But this is in direct contrast to the cuts we've seen in streaming giants like Disney, right?
ALLIE CANAL: It's very interesting-- it's an interesting time for media, because we're seeing a lot of pullback on spending. But at least for these tech giants, they're not doing that on the entertainment side. Of course, we saw Amazon lay off 9,000 workers. That's in addition to the 8,000 cuts that they did in January. Apple has reportedly pulled back on bonuses, has delayed certain product launches in order to avoid layoffs.
So it's clear there's something going on in tech, where they're pulling back on content. But when it comes to entertainment, when it comes to streaming, we're seeing the opposite, right? And even Apple with live sports, we have them reportedly wanting to go after English football games. And that's after they sign that $2.5 billion deal with MLS. They have a deal with the MLB, which, by the way, for the 2023 season you're going to now have to be a subscriber to Apple TV Plus. It's not free be it anymore.
So it's just as reckoning moment I think throughout all of the streaming companies, and tech's included in that now.
DAVE BRIGGS: Two of the biggest five companies in the world by market cap are going into the movies. That is great news for theaters. Allie, thank you. Good stuff.