Classics, what classics? 85% of Netflix’s money is spent on original content

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Netflix built its streaming empire on other people’s content. Whether it was movies or shows that had already made a name for themselves, Netflix snapped them up and hid them behind a fancy recommendation algorithm, serving up the ones it felt were right for you. 

This model for Netflix is changing, and fast. While the algorithm remains and is strengthened every time you click on something to watch, what you are actually choosing is changing and it’s not because of your tastes, but because Netflix is adding more of its original content to its archive and spending lots on it. 

According to Ted Sarandos, Netflix’s content chief, a massive 85% of what it is spending is now going on original content. Given it’s put $8 billion aside to spend, that’s a lot of high-quality original shows and movies in the pipeline. 

Original of the species

By 2018, Netflix is hoping to have some 1,000 bits of original content on the platform - given it currently has in the region of 470 originals right now, that’s a huge burst of new things appearing on the service. 

But why so much on originals, when there are much-loved shows such as The Expanse and The  X-Files being cancelled? For Netflix, this is all about future proofing and making sure it has enough of its own IP to tackle the choppy streaming waters ahead. Taking other people's content means licensing agreements, that eventually have an expiry date. 

Sarandos believes the best way forward for Netflix is to recruit like-minded people - filmmakers that actually use and love the service. 

“The creators we’re talking to, they watch Netflix and they want to be on our network,” he said to Variety

“The way we can secure those shows is having a great reputation with talent, having a brand people want to be associated with, and a good track record of delivering.”

Included in the roster of those making things for Netflix is Guillermo del Toro who has recently signed up to make a horror anthology series for the service (and is also behind the successful animated Netflix show Trollhunters) and American Crime Story’s Ryan Murphy. 

Netflix has to do this, as there will soon be more choice for viewers when it comes to streaming services. Disney is to join the fray and its original content includes all of the Disney back catalog, as well as Star Wars, Marvel, Indiana Jones... 

Not that this is fazing Sarandos, who merely said this of the Mouse House encroaching on Netflix's territory: “I don’t know what took them so long”.