An annual report posted by Amazon has revealed its spending on media content has increased to almost $19 billion.
As one of the Big Five US tech giants, it owns several leading platforms, including Amazon Prime, Amazon Music, Twitch, and Audible.
As reported by Variety, Amazon ran up a bill of $18.9b for TV shows, movies, and music to be utilized on its services in 2o23, reflecting a 14% increase on the $16.6b figure amassed the previous year. The information came to light after the company filed its 10-K annual report at the US Securities and Exchange Commission.
The figures are inclusive of licensing and production costs relating to content offerings across Amazon Prime and other digital subscriptions, rentals, and sales.
In contrast, Netflix spent an estimated $13 billion acquiring and producing content in 2023, with plans to increase that amount to $17 billion in 2024.
Primed for success
On the back of the spending increase, Amazon held its 2023 Q4 Earnings Call on Thursday with a continued belief in the development of Amazon Prime as a profitable asset in waiting.
CEO Andy Jassy stated, “We have increasing conviction that Prime Video can be a large and profitable business on its own, and we’ll continue to invest in compelling exclusive content for Prime members like Thursday Night Football, Lord of the Rings, Reacher, Mr. & Mr. Smith, Citadel, and more,”
He continued on the introduction of ads by default on Prime Video (29 January) unless subscribers opt to pay an extra monthly fee for an ad-free service ($2.99/US) on how “we’ll be able to continue investing meaningfully in content over time.”
The initiative is anticipated to raise an extra $3 billion in incremental revenue over 2024.
Amazon’s content spending includes a significant rights deal with the NFL, with the exclusive package to stream Thursday Night Football, said to be worth around $1 billion per year to the league over the 11-year contract. This can be viewed as speculating to accumulate with Jassy heralding Prime Video’s second season of TNF as “a rousing success by all accounts,” underpinning a year-on-year increase of viewers by 24%.
The sense of achievement won’t be shared by many in the company’s workforce after Amazon laid off hundreds of employees last month across its stable of subsidiaries, including the axing of 35% of Twitch’s headcount.
Amazon’s biggest-ever corporate cut came in 2022 when a whopping 27,000 positions were lost.
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