IHS Markit: Netflix, Amazon top spenders on programming

Staff writer
15 Nov 2016

Netflix and Amazon have ramped up their investment in programming, spending $7.5 billion last year—more than CBS, HBO, Turner and most countries, including South Korea and Australia.

According to IHS Markit, Netflix and Amazon more than doubled their annual expenditure on programming between 2013 and 2015.

Amazon spending jumped from $1.2 billion in 2013 to $2.7 billion in 2015. In the same timeframe, Netflix spending rose from $2.4 billion to $4.9 billion.

“The levels of investment we are seeing from Netflix and Amazon are only topped by Disney ($11.8 billion) and NBC ($10.3 billion),” said Tim Westcott, senior principal analyst at IHS Technology.

Other online platforms like Hulu in the US and China’s Youku Toudu, iQifyi and Tencent have also increased their investment in original programming and acquisitions.

“In what Netflix calls the era of internet TV, more and more consumers are watching content online, shaking the foundations of the traditional TV industry,” Westcott said. “However, it’s premature to declare that the era of linear TV is already over, and Netflix and Amazon have come hard on the heels of a boom in production of original drama and comedy by the likes of AMC and FX in the US."

After the US, the mature Western European region is the next most important, investing $38.6 billion, or just under one-third of the total. The biggest markets in Western Europe were the United Kingdom with $10.7 billion, Germany ($7.3 billion), France ($6.6 billion) and Italy ($4.6 billion).

“Notably, China is now the second-largest market in the Asia-Pacific region, with $8.4 billion invested last year,” Westcott said.

Japan is the largest in the region with $9.8 billion, followed by South Korea ($2.6 billion), Australia and India—both on $2.4 billion. Leading Latin American markets are Mexico ($1.5 billion) and Brazil ($1.4 million). Canada invested $3.4 billion last year. Russia and Turkey were both around the $900 million mark.

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