Technology

Apple informed a showbiz union that it had fewer than 20 million TV + subscribers

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Tim Cook, chief executive officer of Apple Inc. smiles as he speaks on Apple TV + during an event at the Steve Jobs Theater in Cupertino, California, United States on Tuesday, September 10, 2019.

David Paul Morris | Bloomberg | Getty Images

Apple claimed that its TV + service had fewer than 20 million subscribers in the US and Canada as of July, which allows it to pay lower prices behind the scenes to the production crew than streamers with more subscriptions, according to the International Alliance of Theatrical Stage Employees , a union representing television and film workers who perform tasks such as operating cameras and building sets.

Apple has never disclosed subscriber numbers for its Apple TV + streaming service, which came on the market in autumn 2019. Analysts are reluctant to give estimates, but many say its magnitude pales in comparison to services like Netflix, which had 209 million subscribers in the second quarter, and Disney +, which claimed 116 million.

The fact that Apple can pay a discounted price despite being the most valuable publicly traded company in the world highlights some of the problems Hollywood workers face as streaming replaces linear television and movies, and arouses the wrath of union members, who decide whether to go on strike, better pay and working conditions.

Under the current contract, high-budget productions destined for streaming can offer lower prices to workers if the streaming service has fewer than 20 million subscribers in the US and Canada, which is determined on July 1st each year. Apple told IATSE that it had fewer than 20 million subscribers, a union spokesman said.

The union is currently negotiating a new contract with the Alliance of Film and TV Producers. Apple is a member of the alliance, but the alliance negotiates for all of its members and does not create spin-offs for specific companies, according to an industry group spokesman.

An Apple spokesman declined to comment on subscriber numbers, but said the company pays tariffs in line with leading streaming services.

Under the current contract, productions for streaming services are subject to less stringent working conditions than traditional TV shows or movies because streaming profitability is “currently uncertain” and productions require greater flexibility, according to a copy of the contract audited by CNBC.

However, union leaders argue that streaming is no longer a particularly new form of media, and companies that fund streaming productions should pay prices closer to traditional media productions.

“Employees on certain streaming new media projects are paid less, even for productions with budgets that compete with or exceed traditional blockbusters,” said an IATSE press release this week, noting that negotiations had stalled .

The IATSE is preparing for a strike, its spokesman said, and ballots will be sent out on October 1, allowing the union’s 150,000 members to approve a strike.

While new media wage rates are one of the topics currently being negotiated, the most pressing issue is working conditions on the set, including long hours that have worsened during the Covid-19 pandemic, the union spokesman said. Celebrities and actors have started posting messages on social media supporting the IATSE union and a possible strike.

Apple has reportedly spent up to $ 15 million per episode of shows like The Morning Show to add premium content to its service. Apple also bundled free trials with purchases of new phones or tablets, and those trials began to expire in July, forcing many users to decide if they were worth $ 4.99 a month. Apple sold an estimated 206 million iPhones worldwide in 2020, which would be the equivalent of many free trials.

NBCUniversal’s Peacock and ViacomCBS’s Paramount + also have fewer than 20 million subscribers, which allows them to apply for discounts on work, the union spokesman said.

A spokesman for ViacomCBS said the company does not issue Paramount + streaming numbers. NBCUniversal did not provide a comment at the time of publication.

Disclosure: NBCUniversal, which owns and operates Peacock, is also the parent company of CNBC.

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