Netflix will reportedly invest $17.3 billion for original content production this 2020, according to a market research firm BMO Capital.
The firm analyzed that the company will invest $17.3 billion in Netflix original 2020. And steadily increase its investment every year to $26.3 billion in 2028.
Netflix’s aggressive investment is also in line with the growing competition. Because big companies such as Apple, Amazon, and Disney have recently jumped into the online streaming market, BMO Capital stated.
Netflix will still remain the leader in the global streaming market, said Daniel Samon, an analyst at BMO Capital. Adding that there are still factors that will increase investment points.
Regarding the growing number of streaming players competing with Netflix, including Apple TV+, Disney+, Warner Media’s HBOmax, and Comcast’s Peacock, Saman noted that “in a global streaming war, there could be multiple winners.”
BMO Capital also reported that Netflix signed a three-year contract with Korean content company CJ ENM to supply original content.
For the new year resolution, the streaming service stated that it will also focus on emerging markets. And it is also strengthening the foundation on its major markets by adding more original contents.
However, will this original content investment in 2020 help Netflix much?
Previously last year, Netflix had to face a drop in the stock market. The analyst stated that the drop in the stock caused by the company’s continuous money bleeds over original content.
Indeed, with Disney+ and other new competitors emerged, Netflix had to take down many popular contents from its platform. Including the mega-hit Marvel movies and series as well as numerous classic TV series. It leaves the company to rely heavily on original content and subscription.
Nevertheless investors also deemed that Netflix subscription does not bring significant revenue. Even setting the subscription price lower did not help much in increasing the number of paid subscribers.