Amazon's content spend at $5 bn a year, confirms report


MUMBAI: Amazon is bucking up by opening its treasure trove for content. A recent Reuters report says that leaked documents show the company spends $5 billion a year for original and licensed content, which is a big chunk of the company’s expenditure.

Amazon has tough competition because Apple recently said it would spend a whopping $4.2 billion a year on original content by 2022, much higher than its earlier estimate of $1 billion.

The Reuters report also stated that Amazon’s top TV shows drew more than 5 million people worldwide to its Prime shopping club in early 2017. Amazon has never released figures for its total audience. The report adds that Amazon has about 26 million people in the US who watch its Prime Video content. The video content includes films and TV shows it licenses from other companies.

Rival Netflix is way ahead in terms of US subscribers at 55 million. The company says that it is growing at a fast pace and the extra revenue it earns via subscribers will help it in invest more in original content. The company upped its spending for 2018 by nearly $1 billion. Hulu, which has subscribers mainly from the US, claims to have 17 million subscribers.

The first season of the popular drama The Man in the High Castle on Amazon Prime Video had 8 million US viewers as of early 2017, according to the documents. The show cost $72 million for production and marketing and attracted 1.15 million new subscribers worldwide based on Amazon’s accounting. The Grand Tour had more than 1.5 million first streams from Prime members worldwide, at a cost of $49 per subscriber in its first season.

It has often been said that Amazon’s strategy is to use video to convert viewers into shoppers. If it is wooing you with amazing content, such as the $200-250 million on Lord of the Rings, it is only to convince you to keep returning to it to make purchases. Amazon’s investment in Prime original shows has enabled these shows to bring nearly a quarter of the total viewership from 2014-2017.

Amazon’s Prime club includes two-day package delivery and other perks for an annual fee making shopping more attractive. But these internal documents don’t indicate how much the Prime subscribers shop on Amazon. In interviews, Amazon CEO Jeff Bezos has been vocal about how people who use the Prime Video service end up staying longer with the shopping club. These people even agree to become paying members after the free trial, willingly paying a higher rate than those who don’t watch Amazon videos.

Some of Amazon’s videos have even won awards and thus you have Bezos saying, “When we win a Golden Globe, it helps us sell more shoes.”

Also Read :

Gaurav Gandhi to head Amazon Prime Video India

Amazon Prime Music ties up with Saregama

Latest Reads

Reliance Jio adds 27.9 mn subs in Q3; GigaFiber marks entry in 1400 cities

Mukesh Dhirubhai Ambani’s juggernaut Reliance Industries Ltd (RIL) reported 50.7 percent growth in gross revenue for the quarter ended 31 December 2018 (Q3 2019, quarter or period under review) as compared to the corresponding year ago quarter. The company’s operating result was 25.4 percent higher...

iWorld Broadband
Netflix adds 8.8 million paid subs in Q4; stock falls as spending weighs on profits

Netflix in its Q4 earnings beat Wall Street expectation in terms of international subscriber growth but the same in its domestic market remains tepid. For the quarter, the online video platform reported 1.5 million domestic subscriber addition and 7.3 million new subscribers internationally.

iWorld Over The Top Services
Netflix releases the trailer for Soni

Netflix today launched the trailer for the critically acclaimed film Soni, will launch on the service in 190 countries on January 18, 2019.

iWorld Over The Top Services
Netflix raises US prices for the first time since 2017

Is Netflix feeling the heat of well-funded competitors? The king of OTT platforms is increasing its US prices for the first time since 2017.

iWorld Over The Top Services
Amazon Prime Music introduces innovative Hands Free Feature to enjoy music using voice on its mobile app

Amazon Prime Music further deepens its focus on innovative voice features with the introduction of Hands Free feature that enables listeners an effortless, lean-back music listening experience on their Amazon Prime Music mobile app.

iWorld Over The Top Services
ZEE5 maintains momentum with 56.3 mn MAU in third quarter

Media conglomerate Zee Entertainment Enterprises Limited (ZEEL) on Tuesday published its third quarter financial results with its OTT ZEE5 demonstrating continued growth.

iWorld Over The Top Services
Amazon Prime Video drops the full title track of upcoming Prime Original Series Four More Shots Please!

There’s a new anthem for friendship and female bonding in town and Four More Shots Please! is the clarion call! Amazon Prime Video, today dropped the entire title track of Four More Shots Please! Releasing shortly after the no-holds-barred trailer, this title track reinforces the theme of the show...

iWorld Over The Top Services
ZEE5 bridges boundaries to #ShareTheLove with Pakistan, Bangladesh

Three months after its soft launch across 190+ countries, digital entertainment platform ZEE5 is now zooming in on specific priority markets.

iWorld Over The Top Services
Star India's ambitious foray into content with Hotstar Specials

Star India, the nation’s storyteller and its most innovative content company across TV, Films & Sports, is ready with its next big leap in content on the back of its OTT, Hotstar.

iWorld Over The Top Services

Latest News

Load More

Sign up for our Newsletter

subscribe for latest stories