Second: But a film from Apple becoming the first from a streaming service to win the Oscar for best picture was not just a tale of a well-oiled corporate machine. Apple got into the movie business the way a lot of the tech giants do a lot of things nowadays: It spent gobs of money to win a top spot in a market dominated by much smaller companies, and where money wasn’t enough, it used its advantages as a tech platform to help it along. We first saw this sort of bigfooting with music. In 2015, in an effort to compete with Spotify and other music streamers, Apple introduced a music service that came installed on the iPhone and handed out free three-month subscriptions to anyone who wanted one. Early mixed reviews for Apple Music didn’t matter; because it was baked into the device, Apple’s music plan quickly garnered millions of paying users, and today it reportedly has more subscribers than every rival other than Spotify.
In 2019 it did a similar thing with TV. Apple spent a reported $6 billion on content to start Apple TV+, and it gave away a free year of the service with the sale of new Apple devices. Apple TV+’s lineup was full of sleepers — even “Ted Lasso,” its most beloved show, takes some time to warm up to — but with a built-in audience of every new iPhone, iPad and Mac user, the company could afford to take its time to find its footing before asking people to pay. The success of “CODA” was also a story of Apple’s deep pockets: The $25 million Apple spent on the film’s distribution rights was a Sundance record. According to The Wall Street Journal, a veteran awards consultant estimated that Apple spent more than $10 million on the Oscar campaign for “CODA” — more than the film cost to produce.
Apple can continue to throw money at its TV service indefinitely; it could easily afford to never make any money from TV+ and simply run the service as a kind of brand-marketing project. The company’s revenue was about $366 billion in fiscal year 2021. Netflix’s revenue last year was just under $30 billion — about 8 percent of Apple’s.
Third: All of this would seem bad — bad in an antitrust, massive-corporations-gobbling-up-everything sort of way. Netflix and Spotify remain thriving companies, but it just does not seem fair or conducive to competition for Apple to leverage its dominance in one market, smartphones, to get ahead in other markets, like the music and movie businesses. It’s especially troublesome when you consider all the onerous rules that Apple imposes on its rivals through its App Store. For instance, it generally takes up to a 30 percent cut of revenue that app makers collect through in-app purchases. Apple’s own apps don’t have to worry about such concerns.
But again, there are complications here. For one thing, Apple is not, in traditional terms, anything close to a monopoly in the smartphone business. Although analysts believe it makes the vast bulk of the profits in the smartphone industry, its global market share is on par with many rivals’. In 2020, Epic Games, the maker of “Fortnite,” sued Apple to fight the 30 percent commission and other App Store rules. Last year Apple largely won the case. “Given the trial record, the court cannot ultimately conclude that Apple is a monopolist under either federal or state antitrust laws,” a federal judge ruled. (Both Apple and Epic are appealing the decision.)