Netflix announced a sharp escalation in its investment on European content with plans to spend about $1bn on original productions this year. By sharply increasing its content investment across the continent, Netflix will further add pressure on European broadcasters already struggling with how to retain viewers in the face of growing competition from the Internet streaming giants.
Netflix revealed the investment plans at a media briefing event in Rome, where it announced a slate of new originals. The revised budget will more than double last year's spending, with new dramas going into production in Spain, Germany, Italy, France, Poland, Turkey and the Netherlands. Now a global media powerhouse with over 73 million Netflix subscribers using the service outside the US, the company announced record growth numbers in Q1 of 2018.
“Our belief is that great storytelling transcends borders,” said Ted Sarandos, Netflix’s chief content officer. He added that Netflix was “committed to being a voice for European entertainment.” Netflix said current productions in Europe, the Middle East and Africa were generating employment for more than 35,000 people.
Among the new originals set for production, is a drama about the invention of football from Downton Abbey creator Julian Fellowes, and Idris Elba will produce and star in a new comedy. The Dutch production is a series about a group of students opening a portal into “the demonic world of the Dutch Golden Age.”
Stuart Ferreira-Cole, Commercial Director, Ostmodern commented on the news, “Following this week’s news that Netflix plans to double its spending on European content, it’s clear that it won’t surrender the market without a fight. Netflix has evolved its business by completely winning over the audiences of content producers and has now become a media powerhouse that challenges those content producers directly. This has forced content producers to consider how they can build the same brand affinity with their material, while also providing a convenient access points for consumers."
“As a result, the market has started to change, ultimately threatening Netflix’s position. Disney’s removal of all of its content from the platform caused the industry to consider if such a move was a ‘Netflix killer.’ With a growing number of studios getting into the subscription video on demand game, Netflix began losing ground to genre-based OTT services, while seeing more and more programmes pulled from its platform. The essential advantage these new services have is the exclusivity of their content. By investing $1 billion in European content, Netflix is meeting this challenge head on. It has once again laid down the gauntlet to broadcasters and content providers, and time will tell how they respond to the challenge,” continued Ferriera-Cole.