Tim Cook, Apple Inc.'s chief executive officer, smiles as he speaks about Apple TV+ at an event held at the Steve Jobs Theater, Cupertino (California), U.S.A, Tuesday, September 10, 2019.
According to the International Alliance of Theatrical Stage Employees (a union representing TV and movie workers, who do jobs such as building sets and operating cameras, Apple claims that its TV+ service has less than 20,000,000 subscribers in the U.S.
Apple has not revealed the subscriber numbers to its Apple TV+ streaming platform, which was launched in fall 2019. Although analysts are reluctant to give estimates, many believe that Apple TV+'s subscriber numbers pale in comparison to other streaming services such as Netflix (which claimed 209 million subscribers at Q2) and Disney+ (which claimed 116 million).
The fact that Apple can offer a discount rate, despite it being the world's most valuable publicly traded company, highlights the problems facing Hollywood workers. It is also raising the ire of union members who are considering whether or not to strike for better wages and working conditions.
The current contract allows high-budget productions for streaming to offer lower rates to workers if there are less than 20,000,000 subscribers in the U.S. or Canada. This is determined every July 1. A union spokesperson said that Apple informed IATSE it had less 20 million subscribers.
The union is currently in talks with the Alliance of Motion Picture and Television Producers about a new contract. Apple is a member, but the alliance negotiates on behalf of all its members and does not create carve-outs or other benefits for any one company, according to a spokesperson from the industry group.
A spokesperson for Apple declined to comment on the subscriber numbers, but stated that Apple pays rates comparable with streaming services.
According to CNBC, the current contract governs streaming productions under less restrictive labor terms than traditional TV movies and TV shows. However, streaming profitability is "presently uncertain", so productions need greater flexibility.
Union leaders disagree, arguing that streaming is not a new media form. Companies that finance streaming productions should be paid rates that are closer to traditional media productions.
IATSE released this statement: "Workers on certain "new media" streaming projects get less pay, even for productions with budgets rivalling or exceeding those of traditional blockbusters," noting that negotiations were at a standstill.
According to IATSE's spokesperson, the union is preparing for a strike. On October 1, ballots that allow 150,000 members of the union to authorize a strike will go out.
The union spokesperson stated that while new media pay rates are a topic currently being discussed, the most important issue is working conditions on sets, including long work hours. These conditions have become worse since the Covid-19 pandemic. Celebrities and actors are now posting messages on social media in support of the IATSE union, and a possible strike.
Apple is said to have spent $15 million on "The Morning Show" episodes to increase its premium content. Apple offered free trials along with new tablets or phones. These trials began expiring in July and many users had to decide if it was worth $4.99 per monthly. Apple sold an estimated 206,000,000 iPhones worldwide in 2020. That would be a lot of free trials.
NBCUniversal's Peacock, ViacomCBS Paramount+, and NBCUniversal’s Peacock have less than 20 million subscribers. This allows them to request discounts on labor, a union spokesperson said.
ViacomCBS spokeswoman said that the company does not break out Paramount+ streaming numbers. NBCUniversal did not respond to our request for comment at the time of publication.
Disclosure: NBCUniversal is the parent company to CNBC. It owns and operates Peacock.