Content Spending 2024 Projections: Top Media & Tech Companies

After a year marked by cost cutting and prolonged production shutdowns that reduced expenses even below expectations, content spending at the major media and tech companies is poised to rebound in 2024. “Rebound” being a relative term, of course. Per a new forecast from Morgan Stanley, two of the legacy media studios — Warner Bros.

Discovery and Paramount Global — will not surpass their 2022 spending levels this year, while other companies will grow expenses far more slowly than pre Great Streaming Correction rates. Disney, for one, is putting the brakes on spending growth, curtailing the explosive outlays seen following the launch of Disney+.

The Mouse House has already announced plans to cut its content spend to $25 billion for its fiscal 2024 (spanning November 2023 October 2024, which partly accounts for the discrepancy in Morgan Stanley’s calendar year forecast), down from $27B in fiscal 2023 and about $30B in 2022. More significantly, the dynamics of content costs are also undergoing profound changes that will truly start to manifest next year.

With the peak TV era now definitively moving into the rearview, spending on “general entertainment” series will likely remain “more flattish,” as Morgan Stanley’s estimates indicate. Instead, growth will be fueled by theatrical films and sports rights, a wise move in light of the past two years’ lessons regarding the economics of streaming.

As everyone but Netflix must now admit, direct to SVOD movies and star studded scripted shows have officially failed to fuel a subscriber gold rush, as streamers had hoped. The next year will see a dramatic reorientation of content priorities as the streaming wars come to a close and as companies do their best to optimize costs while mitigating subscriber churn and still drawing in new viewers where possible.

All of this is to say content spend will indeed continue to grow, albeit at its slowest rate in recent memory. Global aggregate spending among the top media companies remained essentially flat for the first time in a decade last year, according to new data from Ampere Analysis. In 2024, that figure will increase by about 2%, with expenses projected to total $247.2 billion by Ampere’s forecast.

Meanwhile, companies will still be willing to shell out for the right programming. Exhibit A: ESPN will reportedly pay more than $900 million over eight years for 40 NCAA championships under a deal struck just last week. But TV budgets in particular are likely going to face intense scrutiny over the next year — and, indeed, that process has already begun.

Even Amazon CEO Andy Jassy was said to be “ taking a hard look ” at his company’s spending on series this past summer in the wake of expensive misfires such as “The Peripheral” and “Citadel.” (I also don’t see Disney spending $200 million on a Marvel limited series this year.) Still, Hollywood’s tech players are expected to grow content spending at far and away the largest rates over the next few years — unsurprisingly, as they are unweighted by declining linear networks and severe stock price woes.

Morgan Stanley projects a whopping 23% compound annual growth rate for Apple’s content expenses between 2023 and 2026, and 14% for Amazon. Netflix, for its part, will increase spending at a CAGR of 7.6% versus a 4% average for its legacy media rivals. This is all very much subject to change, of course.

Disney originally planned to spend $33 billion on content in 2022, a ballooning figure that deflated at the drop of a hat (or, rather, a stock price). Wall Street forecasts at the start of last year failed to account for the looming writer and actor strikes that would ultimately save the studios millions in 2023 outlays.

There may yet be looming catastrophes investors can’t foresee, and it wouldn’t be entirely surprising if, for instance, CEO Jassy slashes Amazon Studios’ scripted TV output this year, cutting back on prestige and would be blockbuster titles in favor of cheaper fare like Freevee’s “Jury Duty.” If it seems improbable that Hollywood’s fortunes could get worse after two beyond abysmal years for the media sector, remind yourself that the secular decline of linear TV is only accelerating and the global box office is expected to drop this year thanks to strike related delays and a constricted supply of tentpole titles.

And with SVOD prices rising and content output slowing, there’s a very real possibility that consumers will start to cut back on their streaming subscriptions more aggressively. This means that, above all this year, studios should be seriously rethinking the types of content that might excite audiences.

Nobody knows anything, as the saying goes, but everyone should know by now that some new strategies are needed as Hollywood’s historic reset continues. Read previous VIP+ content spending projections: • Content Spending 2023: WBD, NBCU Projected to Reduce Expenses • Content Spending Levels at Top Media Companies: 2023 Forecast • Top Media & Tech Companies to Spend $140 Billion on Content in 2022 • How Hollywood's Horrible 2022 Impacted Content Spending • Content Spending Levels at Top Entertainment Companies: 2021 Projections.