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Top US Media Groups Including Disney, Netflix Look To Spend $115B In 2022: FT

·1 min read

The top eight U.S. media groups expect to spend at least $115 billion on new movies and TV shows in 2022 to attract new customers for the video streaming business, Financial Times reports.

  • Morgan Stanley sees The Walt Disney Co’s (NYSE: DIS) investment in streaming content growing by 35%-40% in 2022.

  • Disney’s spending on all new movies and TV shows will likely reach $23 billion, though the number rises to $33 billion, including sports rights, up 32% from its total content spending in 2021 and 65% from 2020.

  • Netflix Inc (NASDAQ: NFLX) looks to spend over $17 billion on content in 2022, up 25% from 2021 and 57% from 2020. Netflix aims to break even and become free cash flow positive in 2022.

  • “There is no turning back,” said media analyst Michael Nathanson of MoffettNathanson. “The only way to compete is spending more and more money on premium content.”

  • In the past few quarters, subscription growth has slowed for Netflix, Disney’s Disney Plus streaming service, and others.

  • Costs have been rising as the biggest entertainment and technology companies rush to produce more shows to feed their streaming services.

  • Finding locations to film in Los Angeles has become difficult.

  • Price Action: DIS shares traded higher by 0.36% at $155.76 in the premarket session on the last check Wednesday.

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