There's a really good reason for Apple to take on Netflix

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Tim Cook

REUTERS/Stephen Lam

Will Tim Cook announce that Apple is getting into original video?

At first blush, it seems preposterous that Apple would get into the original content game, as Variety reported on Monday evening.

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Developing and producing TV shows or movies, like Netflix does, would be such a departure from the company's core businesses of selling hardware - Apple is a technology company that primarily makes phones, tablets, computers, and other devices, not a production or entertainment studio that creates content.

And making compelling video that people want to watch is very, very difficult. With a $203 billion war chest, Apple certainly has the resources to do it, though as Microsoft and Amazon have both shown, it takes more than just money to consistently churn out good programming.

But after thinking about the Variety report for a bit, I no longer think it's so preposterous for Apple do get into original programming.

High quality programming, available either as a monthly subscription or free to people who buy a device, could help drive hardware sales, which is the primary way Apple makes money. It gives people just another reason to stay in the Apple ecosystem when they're ready to buy a new device. A streaming video service may not make Apple the same kind of money it makes from hardware, but it could keep users coming back to Apple hardware.

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Here's how Apple could get into original content.

Think about it like Apple Music, but for TV. Variety even reported that "some sources say that the original content efforts could end up being an extension of [the Apple Music] strategy."

So imagine a specially curated "channel," or app, on Apple's new TV box (which is expected to be unveiled next week) that would feature video programming. It wouldn't be a linear channel, like the streaming radio channel Beats 1 on Apple Music, or a regular channel on TV, but rather an app like Netflix or Hulu.

The app, I suspect, would feature programming exclusive to Apple. Whether that's licensed or original doesn't really matter, as long as people can't watch it anywhere else.

Apple could get big-name talent with a huge following - the company, Variety reported, was in a bidding war with Amazon over James May, Jeremy Clarkson, and Richard Hammond, along with their longtime executive producer, Andy Wilman, to get the new "Top Gear" spinoff show.

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What if Apple were to get someone like Jon Stewart? I'm not saying this is what's going to happen, of course, but it's that kind of personality - someone with star power and a large following - that could drive people to the service.

top gear

BBC/Top Gear/Screenshot

Apple was reportedly bidding against Amazon for rights to the new show being developed by the "Top Gear" guys.

The app would also have powerful curation capabilities to make sure to give viewers what they wanted, when they wanted it, like Netflix does.

Jimmy Iovine, the legendary producer who's now the face of Apple Music, recently shared his thoughts about TV with Wired UK:

"We all know one thing, we all have different television delivery systems, don't we all wish that the delivery systems were better, as far as curation and service?" Iovine told Wired. "Sit down with your girlfriend or a bunch of friends and try to find a movie online. That box helps you none -- it doesn't help. You're on your own. And eventually that will catch them unless somebody digs in and really helps the customer. And entertainment needs that, it needs to live and breathe."

Like it's done with Beats Music, Apple could offer the app for a monthly subscription fee. Or, it could simply make it free with the purchase of a new Apple TV.

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A curated channel would also follow the pattern of what Apple is doing with other products and services.

With Apple News, a new news app that's built into the next version of the iPhone and iPad operating system, Apple is delivering a distilled version of the news - content created by others - but presented in the way that Apple wants to present it.

And with Beats Music, Apple is offering music that's available elsewhere, but wrapped up the Apple experience. Beats offers human-curated playlists along with a worldwide radio station with celebrity DJs and big name guests at the helm.

Apple is reportedly working with broadcasters and networks on an internet-delivered TV service that will launch next year. We'll have to wait and see if that service will include an Apple channel.

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