Amazon spent $16.6 billion on digital video and music content last year — up 28% from $13 billion in 2021, the company revealed in its Q4 earnings report last week.
Those expenses included licensing and production costs associated with content offered within Amazon Prime memberships and costs associated with digital subscriptions and sold or rented content.
About $7 billion of the total was spent on Amazon Originals, live sports programming and licensed third-party video content, compared with $5 billion in 2021, CFO Brian Olsavsky revealed in the company’s Q4 earnings call.
Based on ongoing Amazon analyses, video “has proven to be a strong driver of Prime member engagement and new Prime member acquisition,” Olsavsky said, although he did not reveal subscriber numbers.
In comparison, rival streaming service owners Disney spends about $33 billion on content, and Netflix and HBO Max spent an estimated $18 billion each, last year. Paramount said it will up its content spending to about $6 billion for 2023.
Amazon’s investments included its $1 billion-per-year multiyear contract for NFL “Thursday Night Football” streaming rights, and a reported $500 million for Season 1 of “The Lord of the Rings: Rings of Power" (above).
Audiences for Amazon’s first exclusive streamed season of “Thursday Night Football” (9.58 million average per game according to Nielsen, 11.3 million according to Amazon) fell about 25% from its preseason estimate, reportedly causing Amazon to offer some rebates and alternate inventory to advertisers. However, the season also delivered the coverage’s youngest-ever demos, and advertisers appear to be committed to sticking with the programming.
“Rings of Power” drew more than 100 million global viewers and drove more Prime Video sign-ups globally than any previous content on the streamer, according to Amazon.