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Why Tim Cook went Hollywood

Moving the Market: Apple's foray into subscription streaming services and premium original content, which Tim Cook and Eddy Cue will unveil today, is not about competing with Netflix or Disney for dominance in Hollywood. It's about finding new ways to market the Apple experience to consumers.

• With iPhone sales growth slowing, Apple needs new incentives to bring consumers into its universe. The better Apple's suite of services — movies and shows, but also music, news, fitness tracking, mobile payments, etc. — the more revenue Apple will see from subscribers.

The Big Picture: The tech and telecom giants taking over Hollywood are using premium film and television as a marketing tool for core products that have nothing to do with film and television, recasting the production of movies and shows as a means to an end, rather than the end itself.

See Amazon, AT&T:

• Amazon Prime Video is a marketing tool for Amazon Prime. The more people who subscribe to Prime to watch "The Marvelous Mrs. Maisel," the more people paying Amazon to get toilet paper and laundry detergent.

• AT&T's WarnerMedia is a marketing tool for AT&T Wireless. The value of streaming HBO, Warner Bros. and Turner for free on your phone is intended to make AT&T more appealing to customers than Verizon or T-Mobile.

The Upshot: Apple, Amazon and AT&T aren't playing the same game that Netflix and Disney are playing. They don’t need to churn out original content or start buying up major franchises. It will be enough to provide a little added value that convinces consumers to buy an iPhone instead of a Samsung or sign up for Amazon Prime instead of going to the grocery store.

Early Details on Today, via WSJ's Tripp Mickle:

• Apple "has been negotiating" with HBO, Showtime and Starz "to offer their shows to users for $9.99 a month each."

• "Apple has been negotiating to bring its new TV app to multiple platforms, including Roku and smart TVs."

• "Apple plans to showcase a revamped News app that includes a premium tier ... It plans to charge $9.99 for the service.

What's Next: Matthew Ball, former Amazon Studios strategy chief, emails my colleague Daniel Arkin: "Content is hard. It takes time to build expertise, a robust content pipeline and to understand what audiences want from you..."

• "This is why Apple’s advantages — time, budget, reach, monetization — [are] so critical."

Show time starts at 10:00 a.m. PT. Follow along at @DylanByers for updates from the event.

Bonus: Cook was in Beijing over the weekend and told an economic forum there he's bullish on the global economy.

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Susan Wojcicki 'bows out'

Meanwhile, in Mountain View: "YouTube has canceled plans for high-end dramas and comedies," Bloomberg's Lucas Shaw reports, "a pullback from its grand ambitions for a paid service with Hollywood-quality shows."

• "The Google-owned business has stopped accepting pitches for expensive scripted shows... The axed programs include the sci-fi drama 'Origin' and the comedy 'Overthinking with Kat & June.'"

The Big Picture: "The retreat from direct competition with Netflix and Amazon's Prime Video service reflects the high cost — in billions of dollars — needed to take on those deeply entrenched players."

• "YouTube generated more than $15 billion in ad sales last year without a huge slate of glitzy productions and concluded its money is better invested in music and gaming."

🏆 Rally the Market 🏆

What's Next: The Pulitzer Prizes are April 15. Vanity Fair's Joe Pompeo says The New York Times’ Facebook reporting is likely on the short list, which will surprise absolutely no one in Menlo Park.

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The Rimasauskas ruckus

Fleecing the Valley: NYT's Jacey Fortin looks at the strange case of the 50-year-old Lithuanian man who succeeded in stealing more than $100 million from Facebook and Google by sending them fraudulent invoices:

• "Evaldas Rimasauskas ... was involved in running a company that controlled several accounts at banks in Latvia and Cyprus."

• "He and unnamed associates were essentially posing as Quanta Computer, a hardware company based in Taiwan that has done business with Facebook and Google."

• "They sent fraudulent invoices to the California-based tech giants. The invoices were apparently good enough to convince Google, which is owned by Alphabet, and Facebook to wire a total of more than $100 million for them from 2013 to 2015, according to the Justice Department."

The Big Picture: Whoops.

Market Links

• Robert Kraft says he is "truly sorry," in vague terms (NYT)

• Ben Lerer eyes a merger with Refinery29 (BI Prime)

• Joel Simkhai's Grindr turns ten years old (NBC News)

• Joe Rogan finds a passionate podcast audience (Slate)

• Jordan Peele's "Us" shocks the box office (THR)

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Go east, young founder?

Big in the Bay, Big in Brooklyn: via WSJ's Kate King: "Startup founders who recently made the move to New York City say a Bay Area address isn’t necessary to start a successful tech firm.

• "Worries about finding skilled workers and seed money in New York City have waned."

• "Several founders pointed to perks like subsidized office space and proximity to their customers in the finance, health care and retail industries."

• "Others said they wanted to escape Northern California’s 'bubble,' where everyone in line at Starbucks is speculating about the next unicorn."

The Big Picture: "New York-metro companies secured a record $13.3 billion in venture-capital funding last year, up from $4.3 billion in 2013, according to a PricewaterhouseCoopers report published this year."

• Curb Your Enthusiasm: "The Bay Area still leads the pack... with startups there snapping up $45.5 billion in financing last year."

What Next: NYT's Zak Stone looks at how Instagram overran Lake Elsinore.

See you tomorrow.