This is Lowpass by Janko Roettgers, a newsletter on the ever-evolving intersection of tech and entertainment, syndicated just for The Verge subscribers once a week.

Severance. Pachinko. Silo. Ted Lasso. Over the past couple of years, a number of Apple TV shows have become hits with audiences and critics alike. And yet, compared to the size of other subscription services, Apple TV still barely makes a dent.

In Nielsen’s most recent The Gauge report, Apple’s service failed once again to make the top 10 list of most-used streaming services, suggesting that its audience is smaller than not just that of Netflix and Disney Plus, but also Tubi, HBO Max, and The Roku Channel.

New data released by subscription insights startup Antenna last week suggests that this may not be a contradiction at all: Engagement with Apple’s video services is heavily driven by a few anchor shows, according to Antenna’s new State of Subscriptions report, whereas Netflix viewing is spread out much more across a wider range of titles.

The report estimates that 32 percent of what the company classifies as heavy viewers watched the Apple TV show Shrinking in March of this year, while 31 percent watched the action series Monarch: Legacy of Monsters. On Netflix, only War Machine was watched by 25 percent of heavy viewers, while all other titles remained below the 20-percent mark.

“Big scripted hits anchor heavy viewership on Apple TV,” the report notes. “Netflix Heavy Viewers spread across the slate, signaling breadth of engagement rather than concentration.”

A few tentpole titles that get people hooked and become cultural moments: That’s a model premium cable networks like FX, HBO, and Showtime relied on for decades. It’s also something a number of video subscription services briefly tried to replicate in the streaming age as they aimed to compete with Netflix.

When HBO Max first launched in 2020, it was all about extending the HBO brand and curation approach into streaming. Then, WarnerMedia merged with Discovery, which brought a bunch of reality TV shows to the service, muddying the value proposition. The service was even briefly rebanded as Max to attract a broader audience, but Warner Bros. Discovery reneged on that change last year.

Likewise, Disney tried to give its streaming operations more of a premium TV network feel when it launched the FX on Hulu brand with great fanfare in early 2020. Cashing in on the success of the cable network, FX on Hulu was supposed to not just host shows that had previously aired on cable, but also FX-branded Hulu originals. However, it turned out that establishing a premium brand within a service that had a little bit of everything was easier said than done. The company has since phased out the “FX on Hulu” branding and simply uses FX as a content category alongside others, like ABC, Hotstar, and Freeform.

Which raises the question: If being the HBO of streaming didn’t work for HBO, can it work for Apple TV?

“Super-serving against a niche audience you understand really well is a business model,” says Paul Pastor, the chief business officer of Quickplay, which builds streaming apps and infrastructure for media companies like MSG and Gray Media. “They’re doing that extremely well with their shows,” he adds.

Some of the engagement differences between Apple TV and Netflix can be explained by catalog size. Apple TV currently offers subscribers access to around 220 shows, according to JustWatch, while Netflix’s catalog contains around 3,300 shows.

However, Pastor also believes that Netflix is a lot more proactive about surfacing lesser-known gems to its audience. “They really figured out the formula of how to manage that through their recommendations and personalization engines,” he argues. “They’re fundamentally focused on their tech platform.” (Pastor’s company is pitching AI-powered personalization solutions to streaming service operators.)

Pastor acknowledges that Apple does have a few key advantages that allow the company to stick to an HBO-like model for its streaming service.

For one thing, Apple does have a different business model than much of its competition. Apple TV is the only major streaming service that doesn’t have an ad-supported tier yet, and Apple as a company has a huge devices business that allows it to pursue different priorities. This includes using Apple TV as an entry point to then resell other services.

Case in point: If you turn on your Apple TV or browse the Apple TV app on your iPhone, you may find those tentpole Apple TV shows, but also third-party content from services like Hulu, HBO Max, or Prime Video. And when you subscribe to those services through Apple devices, the company grows its already massive services business.

“At the end of the day, Apple is also an aggregator,” Pastor says. “That might be the best business model for them.”

The best business model for now, that is. If the company were to embrace advertising for Apple TV, like it has been rumored for some time, it may embrace a more Netflix-like model with a broader catalog, more personalization, and less of a focus on tentpole titles. Not only do advertisers demand scale, but an ad-supported tier would also fundamentally change the incentive structure for Apple. Right now, the company makes money with monthly fees, no matter how much each subscriber watches. With an ad-supported tier, every additional ad break shown generates extra revenue.

Until that happens, Apple TV may just be the next best thing we have to HBO. Sorry, HBO Max.