Streamers are reevaluating their original strategies, leading to an expected 5% increase in content acquisition spending this year, reaching $14.8bn.
The major global streaming platforms, including Netflix, Prime Video, Disney+, Apple TV+, Paramount+, and HBO Max, are set to collectively invest a substantial $42bn in original and acquired film and TV content for this year, according to the latest report from Ampere Analysis. This represents a more moderate growth rate of 7% year-on-year, in contrast to the 24% surge in streaming spending observed in 2022.
The driving force behind this continued investment in streaming content remains high-budget Originals within key scripted genres such as Crime & Thriller, Sci-Fi & Fantasy, and Comedy. However, given the intense competition and the influence of macroeconomic factors, Subscription Video-on-demand (SVOD) platforms are increasingly prioritising cost management and strategic content acquisitions to ensure their sustained success in 2024 and beyond.
Of the $42bn allocated by SVOD platforms for TV series and films, a staggering 90% is dedicated to scripted content. Crime & Thriller content leads in SVOD spending, with an estimated investment of $12bn for 2023. Sci-Fi & Fantasy and Comedy genres also command significant budgets, underscoring the fact that high-budget scripted TV content remains the most effective tool for attracting subscriptions and retaining subscriber engagement. Netflix and Prime Video, with their extensive reach, adopt a balanced approach to genre allocation, catering to diverse demographics.
Meanwhile, other SVOD players are adopting more targeted spending strategies, concentrating on specific genres and intellectual properties (IP) to cultivate devoted subscriber bases. Apple TV+, for instance, allocates 40% of its budget to Crime & Thriller titles, building on previous successes like Slow Horses and Severance. Disney+ focuses on Sci-Fi & Fantasy and Children & Family genres, bolstered by TV spin-offs from the Star Wars, Marvel Cinematic Universe (MCU), and Pixar franchises.
Other SVoD players are pursuing more targeted spending strategies, focusing on key genres and IP to cultivate loyal subscriber bases. Apple TV+ dedicates 40 per cent of its budget to Crime & Thriller titles, building on past successes such as Slow Horses and Severance. Disney+ has prioritised Sci-Fi & Fantasy and Children & Family genres, anchored by TV spin-offs from the Star Wars, MCU and Pixar franchises.
As streaming platforms face tighter budgets, they are increasingly turning to Entertainment and Reality genres to engage subscribers at a lower cost. Spending on Unscripted content by SVOD platforms is projected to reach $4.9bn in 2023, marking a robust 22% year-on-year growth, outpacing the overall spending increase by global streamers. This shift extends beyond Documentaries to encompass Entertainment and Reality, with a particular emphasis on producing and acquiring formats like Dating, Talk shows, and Game shows.
While exclusive original titles have been instrumental in boosting content budgets for global SVOD platforms, they are now shifting their focus towards content acquisition strategies, which are poised to assume a more pivotal role. Content acquisition spending for major SVOD platforms is expected to grow by 5% next year, reaching $14.8bn. Genres such as Crime, Romance, and Drama lead in acquired content spending, offering significant potential for cross-border content licensing. In their quest for cost-effective library expansion, and in light of industry strikes in the US, SVOD platforms are seeking inspiration from success stories like NBCUniversal’s Suits and HBO’s Band of Brothers and Insecure, now available on Netflix.
Commenting on the findings of the report, Neil Anderson, Senior Analyst at Ampere Analysis, said: “In 2023, we forecast that major global SVoD platforms will collectively invest $42bn in film and TV content. The moderated spending growth rate in comparison to previous years underscores the maturity of the SVOD market and the importance of strategic spending across genres. At $15bn, Netflix will retain its position as the top investor in global streaming content, albeit with a modest 2% increase. Meanwhile, rivals such as Disney+, Paramount+ and Apple TV+ are poised for more substantial budget expansions, projecting year-on-year increases exceeding 10%.”
Content acquisition spend is expected to rise by 5% this year to $14.8bn as streamers rethink their original strategies
