With the rise of streaming platforms like Netflix, investing in movies and TV shows has become a hot topic in 2020 Hollywood. The streaming wars between Netflix, Disney+, HBO Max and more bring both opportunities and challenges. There is huge demand for original content, but also intense competition for content rights. This article will analyze key information and conclusions around investing in movies in 2020 in the streaming era.
Demand for original content drives investment despite losses
Streaming platforms are spending billions creating original movies and shows, even running losses, to compete for subscribers. Netflix spent over $17 billion on content in 2020 despite little profit, aiming to lock in users. Disney+ also invested heavily in originals like The Mandalorian. With people staying home more, demand for fresh content is likely to remain high in the short term, attracting more capital.
Competition for content rights increases risks
As more streaming services enter the market, the bidding wars for content rights will intensify. Platforms are paying hundreds of millions for franchises like Friends or Seinfeld. This inflates costs but provides no guarantee of subscriber growth in return. Investors in streaming Originals face the risk of losing access to mainstream content.
Theaters still relevant despite COVID challenges
While streaming grew rapidly during COVID shutdowns, the role of movie theaters is evolving, not dying. Films like Godzilla vs Kong or Dune still aim for theatrical releases first to build buzz and profitability. Investments into enhanced theater experiences could drive demand. Hybrid distribution models may emerge, with shorter theater windows before streaming.
International markets critical for profitability
As domestic markets saturate, emerging markets provide huge potential for subscriber growth. Platforms are adapting localized strategies, as evidenced by Netflix investing in more Korean, Indian or African content. But trade barriers or censorship add complexity to intl film investment. Financing diverse stories for global markets is key.
In summary, the streaming era provides big opportunities but also risks for investing in movies in 2020 Hollywood and beyond. Demand for fresh, high-quality content persists, especially with international expansion, but costs are rising amid intense streaming competition. Strategic investors will focus on content portability, IP protection and flexible distribution.