Stock up on premium online motion picture and television content for its coming iTV experience, that's what. TechCrunch's Editor Erick Schonfeld writes a similar POV today in his post "What Apple Should Do With Its $100 Billion Cash: Buy Hollywood!", with which I absolutely agree. You see, Apple's playbook -- taken to the next level brilliantly with the iPod/iTunes 1-2 punch -- is to create a revolutionary consumer experience buy seamlessly marrying its beautiful hardware (in this case, the coming iTV) with great software and rich services (in this case, motion picture and television content).
For Apple's iTV to be the juggernaut it has the potential to be, it must be a true differentiated Apple-like experience, not just "TV." That means that Apple must build a deep and differentiated pool of video content -- including premium linear TV programming channels like ESPN (yes, Apple will become a virtual cable operator). And, cash is king, of course, to the Hollywood content king-makers. So long as Apple puts up -- and they certainly have lots to put up -- they will get what they want.
And, if they do, Apple will be the true kings of content, just like they have been in the online music game for a decade. Remember, Hollywood's gross box office receipts for all of 2011 were significantly less than that number (in North America, gross movie receipts were about $10 billion). Apple's revenues just for last quarter were $46.3 billion! Content, to Apple, is just the Trojan Horse for consumers ride into their kingdom of riches -- Macs, iPad, iPhone, iPod ... and its inevitable iTV.
The question is -- will studio execs take the easy money from Apple, or will they shake things up to capture more of the value they create for it?
More on that later ....