Netflix’s huge outlay on original programming and classic shows could be impacted by new competitors
Netflix just laid down the gauntlet, essentially telling its competitors: Catch us if you can.
The streaming heavyweight is now on the verge of hitting 150 million global subscribers, Netflix reported on Tuesday, giving it a formidable lead on new challengers like Apple and Disney that have announced plans to enter the streaming race later in the year. Netflix has built that lead in large part thanks to heavy investment — with $15 billion earmarked for content in 2019 alone — but can that breakneck spending continued unabated?
First, it’s worth pointing out that pumping big dollars into programming is critical to Netflix’s continued dominance. “Content spend remains highly predictive of forward subscriber additions,” Goldman Sachs analyst Heath Terry said in a note to clients on Wednesday morning based on a study of internal data. He added that the company’s “accelerated” spending between 2018 and 2019 leaves “considerable upside” for Netflix to attract new customers.
Of course, that should be the case. As Netflix invests in more shows, especially in local content aimed at budding markets like…
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