Netflix is planning to ramp up production of original content in the new year. The streaming giant currently offers 30 scripted series’, with plans to double that number to 60 in 2017, according to a report by Forbes.
In 2016 alone, Netflix released more than 600 hours of original content. Their goal for next year? 1,000 hours, an increase of 67%.
“The Internet allows us to reach audiences all over the world and, with a growing base of over 86 million members, there’s a large appetite for entertainment and a diversity of tastes to satisfy,” Netflix said, in their Q3 shareholder report.
In order to scale up production, the streaming service will increase its original content budget to $6 billion, up from this year’s $5 billion.
Industry analyst Ville Salminen, owner of streaming news site Cordcutting.com, forecasts that Netflix will have pulled $8.82 billion in revenue for 2016. This would set their original content budget at 57% of revenues in 2016. Forecasters also expect Netflix to earn $11.02 billion in revenue next year, which would put their increased originals budget at just 54% of revenues.
“In absolute terms, $6 billion is, of course, more than $5 billion, but relatively Netflix is going to spend less on content in 2017 than in 2016,” Salminen told Forbes.
While original content may be more expensive up front, it’s often a much better value in the long run when compared to traditional licensed content. Netflix collaborates with directors and producers in the creative community to make a hit show, then purchases the entire piece of intellectual property, thus securing global rights in perpetuity at a one-time fixed cost. Licensing shows are more complicated, often involving deals with multiple rightsholders in different territories, and are only available at a recurring cost.
Netflix membership has risen about 4.2% in 2016, with more than 47 million people actively subscribing to the service.