Disney’s decision to license more TV shows to Netflix this year marks a turning point in the expensive battle for supremacy in online streaming. Under pressure to stem losses, entertainment companies are opting to sell more of their content to Netflix. By waiting out its rivals, Netflix has eclipsed them.
It has done this through a vast, debt-fuelled expansion followed by concerted cost cutting. When entertainment companies first competed in streaming they began by hoarding their most popular TV shows and films. The loss of shows like Friends put pressure on Netflix to build up its own back catalogue. It expanded into reality TV, romcoms and international series while handing over large sums of money to well-known showrunners such as Shonda Rhimes and Ryan Murphy. By 2021, annual content spend in cash terms exceeded $17bn.