Netflix Pledges to Eat $3 Billion in Debt for Original Programming

Image: Getty
Image: Getty

Netflix announced in a press release on Monday that the company would be taking on another $800 million in debt in order to create more original content. Netflix is already in $2.37 billion of debt to further Netflix’s vision of being 50 percent original content. Chief content officer Ted Sarandos announced in January that the company planned to invest $6 billion total in creating its own movies and TV shows. So it’s half way there.

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Netflix has already dramatically decreased its selection of movies and TV shows, so this new content better be pretty dang good if it’s going to replace the many good things we have lost.

As one of the few people who isn’t too into Netflix original series—I think Hulu, HBO and Amazon are all superior, sorry—this feels like a huge gamble. One study shows Netflix’s original content gets 11% better customer reviews than other content on the site. But that doesn’t seem like enough of a reason to invest this much in original programming if the company is also phasing out so many other great movies and TV shows. Why can’t we have both?

[Polygon]

Eve Peyser was the night editor at Gizmodo.

DISCUSSION

StarControl

Any sane investor looks at this and thinks .. well, they’re getting 800 mil more in the hole. That original content will only hook people for what 3 more months? 6 more months, then they binge it and leave. If the other content is not there, people have no reason to stay. So then they’ll have to get another 800 mil to create some more content for people to stay. And more, and more.

Valuation on the company is nuts, and last weeks’s huge bump was nuts too. They have to raise prices a LOT more, which would most likely of course lead to customer loss (or not much gain). Otherwise they’ll end up with original content that is “old” (i.e. all their current customers have already seen this shit) and say 5 billion in the hole. Not feeling it.