Growth in content investment to slump in 2023 predicts Ampere Analysis

The year ahead will see the slowest growth in content spend in a decade, bar the 2020 pandemic year, according to media research and insights firm Ampere Analysis.

Hannah Walsh

Ampere said it expects global content expenditure to increase by just 2% year-on-year – the lowest growth in more than a decade (excluding the Covid-driven slump of 2020).

This is in stark contrast to 2022 during which global content spend is projected to have grown by 6% to US$238bn, driven primarily by SVoD platforms. Despite some degree of caution in the second half of last year, SVoD services collectively spent more than US$26bn on original content in 2022.

Economic headwinds across the globe will put pressure on household spending and advertising investment, leading companies to implement cost-saving measures and reduce content expenditure, Ampere said today. Companies already implementing these measures include Netflix which, following its first global decline in subscribers, announced it would plateau its investment in content during 2023.

But the story isn’t uniform across media groups – some will continue to drive investment through 2023, while others cut back.

In 2023, Disney and newly formed Warner Bros Discovery will overtake Comcast and its subsidiaries to become the leading investors in original content—Disney reaching US$10.5bn and Warner Bros Discovery exceeding US$9.5bn. Netflix will continue to lead dedicated SVoD spend, contributing more than 25% of global SVoD original content investment.

Content investment by commercial and public broadcasters continues to linger below pre-pandemic levels, driven by declines in broadcast TV advertising revenue stemming from wider economic weakness and the ongoing shift of audiences to streaming platforms. In 2023, commercial broadcasters are expected to face a 3% decline in content investment.

Hannah Walsh, research manager at Ampere Analysis, said: “SVoD services will still see an increase in total content investment in 2023 but a lesser 8% year-on-year growth compared to 25% in 2022. Services will continue to focus on original content to compete in a crowded cost-sensitive market, but we are already seeing a shift in content commissioning to incorporate a greater volume of cheaper unscripted formats.”