Election-related investment and a return to production will boost spend
In 2024, Ampere Analysis forecasts global content spend will increase by 2% year-on-year, following a plateau in content investment growth in 2023. Last year was predicted to deliver comparable growth, but WGA and SAG-AFTRA strike action led to a two percentage point decline relative to original expectations. In 2024, broadcasters’ and streaming services’ revival of postponed productions will steady the flow of content and push global content spending back into mild growth. Ampere has just published its forecast, with the analysts anticipating that the industry will reach $247bn in 2024, up on 2023’s $243bn.
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Global streaming services remain crucial for spend growth
- Despite production reaching a near-complete halt in the USA, global streaming services were able to weather the storm and continue a steady delivery of new original content in 2023 with the help of non-US productions.
- Heavier investment in original shows and movies from markets including Germany, India and South Korea helped boost global streaming services’ expenditure on original content to over $27bn, an increase of 13% year-on-year.
- With a continued focus on international productions, the delayed release of US original titles, and an increased desire for sports rights, global streaming services are set to increase their total content spend by 7% in 2024 to $46bn.
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Election to boost US broadcasters, while theatrical studios cut back
- Content investment by commercial broadcasters worldwide largely remains stagnant as they battle weaknesses in the TV advertising market.
- However, while the US broadcasters were worst hit throughout the industrial action in 2023, the 2024 presidential election is set to bolster advertising revenue and content spend, preventing further decline this coming year.
- By contrast, US theatrical studios are set to see a 14% year-on-year decline in content investment in 2024 due to the after-effects of strike action, and ongoing focus on cost-efficiency in a cinema market that remains depressed post-COVID.
- Notable exceptions of this trend are Amazon and Apple which plan to increase theatrical releases. Apple will leverage theatrical content to increase brand awareness for its streaming service Apple TV+, while Amazon seeks to utilize MGM after its acquisition in 2022.
Hannah Walsh, Principal Analyst at Ampere Analysis says: “2023 was a worse than expected year for content spend due almost entirely to the Hollywood strikes. The good news is we can look forward to a small recovery of 2% as production resumes and the US election approaches. Global streaming services are forecast to increase total content investment by 7% in 2024 and thus remain key for content spend growth. However, it’s not all rosy as many studios look to cut back on theatrical releases, and broadcasters cut spending due to ongoing declines in TV advertising.”
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