Netflix invests 2 billion dollars extra in, among other things, its own productions

Netflix is ​​going to take on about 2 billion dollars, converted 1.8 billion euros, in debt on top of its existing 11 billion euros debit, to compete with other streaming services. In addition, it is looking for ways to prevent account sharing.

“Our revenue is growing fast and so is our margin, which makes it possible to further invest in our own content and finance it,” the company wrote in a letter to its shareholders. The money goes on to “take content, production and development, capital expenditures, investments, working capital and potential acquisitions and strategic transactions”. For reference: in 2018 Netflix made almost 1.1 billion euros in profit.

Netflix faces increasing competition from video-on-demand services like Disney+, Apple TV+ and the upcoming HBO Max, each with their own original programming and looking to take some of Netflix’s dominant market share. According to market researchers, that share is currently between 80 and 90 percent.

At the same time, while discussing its Q3 2019 earnings, Netflix announced it was looking for “consumer-friendly” ways to curb account sharing. The more expensive Netflix subscriptions offer the possibility to stream on two or four screens simultaneously, but the intention is that this happens within the household. However, it is not uncommon for passwords and accounts to be shared beyond the front door. That would cost the company about $135 million a month. Another service related to this and looking for solutions is Spotify. It is not known what Netflix wants to do to prevent account sharing.