Netflix and Amazon Outspend CBS, HBO and Turner on TV Programming, IHS Markit Says
October 17 2016 - 8:13AM
Business Wire
TV programme producers adapt to the era of internet TV
Online platforms Netflix and Amazon have ramped up their
investment in programming, spending $7.5 billion last year—more
than CBS, HBO, Turner and most countries, including South Korea and
Australia.
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IHS Technology: Worldwide TV programming
expenditure by region 2015 ($bn) (Graphic: Business Wire)
Between 2013 and 2015, Netflix and Amazon more than doubled
their annual expenditure on programming. In 2013, Amazon spent
$1.22 billion; that jumped to $2.67 billion in 2015. In the same
timeframe, Netflix spending rose from $2.38 billion to $4.91
billion.
The findings from World TV Production Report 2016, a forthcoming
report by IHS Markit (Nasdaq: INFO), a world leader in critical
information, analytics and solutions, examined how TV programme
producers are adapting to the era of internet TV.
“The levels of investment we are seeing from Netflix and Amazon
are only topped by Disney ($11.84 billion) and NBC ($10.27
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."
There were 148 new scripted shows aired by basic cable networks
in the US, up from 138 the year before and 96 in 2013, according to
the IHS Technology report. In 2016 so far, there have been 113
scripted basic cable shows, compared to 78 on the networks, 31 on
premium cable, and 57 online. To set these numbers in context: in
2012, there were three online scripted US TV shows, that number
rose to 20 in 2014, 41 in 2015.
Regional breakdown: US is clear leader, but China rises to
number two in APAC
“The primacy of the US in the worldwide programming market is
clear,” Westcott said. “We estimate that in 2015, the US
represented 33 percent of worldwide expenditure on TV programming,
with $43 billion invested across free-to-air, pay TV and
online.”
“Amazon and Netflix, though they are US companies, are now
commissioning for multiple territories, so we have treated them as
global platforms.”
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 UK 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.
For further information about this product, please contact
Ben.Cross@ihsmarkit.com.
About IHS Markit
(www.ihsmarkit.com)
IHS Markit (Nasdaq: INFO) is a world leader in critical
information, analytics and solutions for the major industries and
markets that drive economies worldwide. The company delivers
next-generation information, analytics and solutions to customers
in business, finance and government, improving their operational
efficiency and providing deep insights that lead to well-informed,
confident decisions. IHS Markit has more than 50,000 key business
and government customers, including 85 percent of the Fortune
Global 500 and the world’s leading financial institutions.
Headquartered in London, IHS Markit is committed to sustainable,
profitable growth.
IHS Markit is a registered trademark of IHS Markit Ltd. All
other company and product names may be trademarks of their
respective owners © 2016 IHS Markit Ltd. All rights reserved.
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