Netflix spending $6 Billion on content

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Image: Netflix

Imagine you had $6 billion dollars to play with. What would you do with it? Create new seasons of two already existing Marvel series: Marvel’s Daredevil and Marvel’s Jessica Jones? Or why not throw a few more steaks on the grill by adding Marvel’s Luke Cage, Marvel’s Iron Fist, and Marvel’s The Defenders; you can certainly afford it.

Those are just a few of the original shows Netflix is launching this year, along with other new movies and original programming that gets mixed in with externally-produced content (the $6B doesn’t appear to include distributed titles) such as DreamWork’s Home, AMC’s The Walking Dead and the BBC’s Sherlock.

Many critics are warning about Netflix spending this much money on new content, and some foresee a permanent drop in stock value (in fact, shares fell almost 13% on Tuesday after the company released their quarterly earnings report). But Reed Hastings and crew see $6B as a risk worth taking, and Netflix subscribers (all 80-plus million of them) don’t seem to be consuming any less streaming video..

Netflix is no doubt counting on the price hike for “grandfathered” subscribers next month. Those who were paying $7.99 for unlimited streaming with HD will soon get their subscription rate bumped to $9.99 per month. Netflix reports half of their 45 million US subscribers are grandfathered, so that would mean approximately $45 million extra per month to work with.

The investment in programming is clearly evidenced in the number of originals created; it almost seems like a gold rush for content creators. And, Netflix is producing more video in Ultra HD as 4k TVs take over electronics shelves. The company just announced a dozen new titles that will also be be formatted with High Dynamic Range (HDR) video and some with Dolby Vision — the latest spec that offers more color range, contrast, and vivid details than previous color specs.

With contributions from HD Report authors.

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HD Report provides news, commentary, and information about 4k & HD channels, programming, and digital media. We write about the latest in gaming, apps, streaming media, Blu-ray, hardware, and technology related to home entertainment. HD Report can also be found on Google+, Facebook, and Twitter.

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