Netflix ‘Sound of Metal, starring Riz Ahmed.
Source: Netflix
Amazon spent $ 11 billion on content for its streaming video and music services last year, the company announced in its annual report on Thursday, the latest sign of the company’s willingness to invest heavily in entertaining Prime members.
The $ 11 billion in content spend in 2020 is a sharp increase from a year earlier, when Amazon spent $ 7.8 billion, according to the report. Amazon defines video and music expenses as all licensing and production costs, as well as costs associated with digital subscriptions and content sold or rented.
Amazon has been trying to grab consumers’ attention in a sea of competing video and music streaming offerings from Netflix, Disney, Apple, Spotify, and many others. In recent years, it has built a robust library of original and licensed videos, music and podcasts, including through the December acquisition of podcasting start-up Wondery.
In 2020, spending on video and music content spiked as consumers spent more time indoors looking at screens during the coronavirus pandemic. Amazon has also pursued higher-end movie projects as its profile in Hollywood has increased.
The company has long been willing to make major investments in video and music content as a strategy to boost Prime memberships. On Thursday, CEO Jeff Bezos announced in his annual shareholder letter that Amazon now has 200 million Prime subscribers, up from 150 million in early 2020. Amazon is folding its music and video offering into the Prime subscription, which costs $ 119 per year and includes other benefits such as free two-day shipping.