Creating and licensing quality content comes with a price. CFO David Wells said Netflix expects to spend $8 billion in 2018 on its own shows and licensed series such as The Walking Dead.
The news comes shortly after Netflix poached TV gods Ryan Murphy and Shonda Rhimes from FX and ABC, paying $300 million and $100 million, respectively. As part of the mega-deals, Murphy and Rhimes will be creating and producing brand-new content exclusively for Netflix, leaving other hit shows such as American Crime Story and How To Get Away With Murder on network TV.
"Let's continue to add content," he said. "It's working, it's driving growth."
With 117 million members and counting, he's not wrong. Still, some could argue that trying to pump out 700 originals in a year is a risky move. One of the reasons Netflix is able to do this, though, is because they're not beholden to the same network rules. Who cares if 578 are flops if the other 122 are massive hits in the U.S. and abroad? And, based on what we know about upcoming originals like Sabrina, Somebody Great, and comedian Michelle Wolf's currently unnamed weekly talk-show, it's likely their success rate will be even higher.
This story originally stated that Netflix was spending $8 billion to create 700 new originals in 2018. That is incorrect. The $8 billion will go towards original and licensed content. Additionally, the 700 figure includes both new and returning original series. These corrections are now reflected in the story.