Netflix Says Competitors Are Overpaying for Old Shows
The price of streaming video content has skyrocketed as new competitors enter the market. AT&T's (NYSE: T) WarnerMedia is spending billions for the rights to old shows including Friends, South Park, and The Big Bang Theory for its upcoming HBO Max service. Comcast (NASDAQ: CMCSA) spent $500 million for the rights to The Office for its Peacock streaming service. Even Netflix (NASDAQ: NFLX) isn't immune to spending big bucks on old shows: It bought the global streaming rights to Seinfeld for $500 million.
But Netflix content chief Ted Sarandos believes the prices those media companies are paying are too high. "The value of those shows -- viewing value -- was going down and the cost of them was going up pretty dramatically in the opposite direction," he said at a recent investor conference. "So that creates a massive opportunity cost to cling onto things that were radically overpriced relative to their viewing contribution."
Image source: Netflix.
Source Fool.com
