To put this figure into respective, this was the same amount of cash Amazon paid in 2013 when it began producing original content in 2013. On Wednesday, those stocks barely budged.
According to insiders cited by The Wall Street Journal, Apple has gone through its couch cushions and collected about $1 billion earmarked for buying and producing original content over the next year. Its reality show Planet of the Apps has had its fair share of success and "Carpool Karaoke" continues to send shockwaves online. In comparison, Netflix is expected to spend about $6 billion this year.
In June, Apple hired Sony Pictures Television co-presidents Erlicht and van Amburg as co-heads of worldwide video programming.
Prior to focusing on original content, Apple was more into renting TV shows and movies.
Apple is finally getting serious about original TV programming.
To gain traction, at least one of Apple's shows must be a hit.
But that era lacked a cohesive strategy, with various Apple execs involved in shows on a case-by-case basis, according to insiders.
Apple's entry into the original content space makes sense given its deep investments in TV and mobile devices, as well as in digital download and streaming services. Basically Apple has the power to pull off ambitious projects with big name directors and actors and may even pull off theatrical releases to be eligible for Academy Awards, which is something that Netflix has been wrestling with now. Whether Apple's video ambitions take off is dependent on whether the company can create content in the same caliber as streaming rivals' originals, that have amassed dedicated fan bases and critical acclaim. Users are able to subscribe to services like HBO Go and Netflix through the App Store, and Apple is able to get 15 percent from those subscriptions.