The WSJ is reporting this morning that Apple has created a budget of $1 billion for original content for the next year, to be managed by Zach Van Amburg and Jamie Erlicht, two high-profile producers Apple lured from Sony in June to head up its video efforts.

While details are light (as they always are), the report said Apple could use the funds to acquire and/or produce up to 10 TV shows either to be included in its Apple Music service or in a new standalone video service. The report said that Van Hamburg and Erlicht have “begun meeting with Hollywood agents and holding discussions about shows Apple could acquire.” Another industry executive, Matt Cherniss, previously president of WGN America, has been brought on to run development.

The new report is the latest in what is certainly one of the longest-running mysteries in the video industry. How could Apple, with its vast device ecosystem, intense customer loyalty and billions of dollars completely miss out on the online video revolution that has propelled Netflix, Amazon, YouTube, Hulu and countless others? Someday there will be business school case studies devoted to unraveling this question.

In the meantime though, today’s news represents the latest splashy rumor about Apple’s imminent plan to move into video. But, in a sign of how high the stakes have become, even a $1 billion annual budget by Apple is not that impressive in the context of Netflix allocating $7 billion per year, Amazon $4-5 billion per year and industry stalwart HBO around $2 billion per year, among others. Particularly in light of the expensive SVOD talent wars that are raging, Apple could burn through a billion dollars pretty quickly depending how high it sets its sights.

To have any degree of success in video, then far more important than the amount Apple might spend on shows is what business model the company will use to generate viewership and revenue. These were the issues I raised a couple of months ago when Van Amburg and Erlicht were hired. Apple is nowhere in terms of an OTT subscription or ad-supported business. While Apple Music gives the company a foothold in music subscriptions, it’s uneconomic to think about using it to monetize a billion dollars of video investments.

I’ll readily admit that it’s enticing to think about Apple entering the TV space at last, and certainly the hiring spree is the most tangible sign of Apple’s purposefulness. But given the intense competition, proliferation of high-quality originals already available and lack of an apparent business/audience model, Apple’s eventual success in video still seems elusive.