Can HBO keep up? Netflix will spend $5 billion on content in 2016

Netflix Vs HBOImage Source: Netflix

We always like to talk about how Netflix is ‘doubling down’ on original content, but truth be told, that doesn’t really capture the full scope of Netflix’s programming objectives. Netflix doesn’t just want to increase the breadth of its original content, it wants to completely dominate the premium original content space and completely dethrone HBO in the process.

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In 2016, Netflix is planning on spending $5 billion on content, a figure which includes a mix of  traditional TV and movie licensing costs and wholly original content. To put that figure into perspective, Netflix in 2013 spent $2 billion on content.

With Netflix seemingly spending every spare dime it has on content, the company is particularly sharpening its focus on original content. Indeed, popular programs like House of Cards and Narcos only serve to further differentiate Netflix from rival streaming services like Amazon Prime and Hulu. Indeed, a renewed focus on original content is precisely why Netflix had absolutely no qualms about letting its movie deal with Epix expire, losing thousands of films in the process, including popular titles like The Hunger Games: Catching Fire.

“In 2016,” Exstreamist writes, “Netflix will have more series (over two dozen) than powerhouses like HBO and FX/FXX.” We’re also directed to this informative chart from Vulture which lays out the full extent of Netflix’s strategy to flood the market with original programming.

netflix original programming

“[The] rapid rise of Netflix as a source of original programming is breathtaking — and without recent historical precedent,” Josef Adalian wrote for Vulture this past summer. “FX and HBO, for example, had been in business for one and two decades, respectively, before they began seriously expanding their scripted offerings — and then did so at a much more measured pace than Netflix.”

In fact, the only media property poised to spend more on media content next year is ESPN. What’s more, Netflix’s content costs may very well surpass those of HBO, Amazon, Showtime, and Starz combined. While most media properties are increasing their content budgets, to be sure, no one is doing so at a more rapid clip than Netflix.

Currently, Netflix has more U.S. subscribers than HBO, but once we account for International viewers, HBO takes the number one spot. With Netflix now more intent than ever before on churning out fresh content, not to mention ongoing plans for global expansion, it stands to reason that Netflix is eagerly hoping to dethrone HBO as a premium destination for fresh content.

And if we look at what Netflix has been able to produce lately, it may very well accomplish that sooner rather than later. HBO undoubtedly has a solid lineup of original programming, with hits such as Game of Thrones and Silicon Valley coming to mind, but it’s becoming increasingly hard for anyone, including HBO, to really keep pace with Netflix.

Netflix may have a few duds in the rotation, but by and large, they have a higher batting average when it comes to delivering well-received shows than any other content producer on the planet.

Source:
Exstreamist
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