Why Spending $8 Billion On Content Is Not Actually That Much, According To Netflix's Reed Hastings
Netflix is undeniably at the top of the streaming game, and the company has been shelling out big bucks in recent years to guarantee that it stays on top. After spending around $6 billion to produce new content in 2017, Netflix bumped the budget up to a whopping $8 billion. While that $8 billion may seem like an obscene amount of money for TV shows and movies, Netflix CEO Reed Hastings doesn't think it's all that much for a key reason, saying this:
If Netflix was producing content just for the United States or any other single market, that $8 billion price tag would definitely come across as obscene. Given that all that content is aimed at international markets, the cost sounds less over-the-top. After all, original TV shows don't come cheap, and Netflix is getting into the original movie game more and more as well. The streaming service won't make money without spending money; if the $8 billion investment pays off, Netflix could become even more dominant in the streaming game. Of course, Netflix may never invest as much money in a TV show as Amazon is with the Lord of the Rings endeavor.
That said, $8 billion is a lot of money, and Netflix borrowed a lot of it. The company has made some big gambles, which almost certainly means that Reed Hastings and Co. at Netflix have a lot of faith in their international projects (and markets). His comments at TED in Vancouver (via Axios) indicate that the team at Netflix is all-in on the $8 billion investment.
Reed Hastings' comments come shortly after a report was released stating that licensed content (like full seasons of Grey's Anatomy and Breaking Bad) is way more popular with subscribers than original content, and the numbers were rather shocking considering the emphasis Netflix places on original series. That said, the numbers used to accumulate the data were not officially released from Netflix, and we can bet that Netflix had numbers that encouraged the production of originals. There's no saying at this point if all the billions of dollars will sway more viewers toward original series like Stranger Things and Ozark rather than licensed content; we can only wait and see.
For your many viewing options from Netflix now and in the not-too-distant future, be sure to take a peek at our 2018 Netflix premiere schedule. If you're more in the mood for streaming options from another outlet, we have a handy 2018 Amazon Prime premiere guide as well. For those who prefer broadcast TV to streaming, swing by our midseason TV premiere rundown and our summer TV premiere schedule. Not all shows have been lucky enough to score orders for more seasons moving forward; you can find which network TV series have already had their fates decided on our breakdown of TV renewals and cancellations.
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Laura turned a lifelong love of television into a valid reason to write and think about TV on a daily basis. She's not a doctor, lawyer, or detective, but watches a lot of them in primetime. Resident of One Chicago, the galaxy far, far away, and Northeast Ohio. Will not time travel, but will sneak references to The X-Files into daily conversation.
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