Amazon.com, Inc. which is an American multinational technology company based in Seattle, Washington, has spent $11 billion on content for its streaming video and music services last year. This information was revealed by the company itself on Thursday in its annual report, the latest sign of the company’s willingness to invest heavily in entertaining Prime members.
This amount of $11 billion which has been spent on content in 2020 is considered to be a sharp uptick from a year earlier when Amazon spent $7.8 billion. Amazon determines video and music expenses as any licensing and production costs, as well as costs associated with digital subscriptions and sold or rented content.
However, the company has managed to seek consumer’s attention in a sea of videos and music streaming offerings from Netflix, Disney, Apple, Spotify, and many others. Over the past several years, it has built up a vast library of original and licensed videos, music, and podcasts, including through its acquisition of podcasting start-up Wondery in December.
In addition, with the onset of the global pandemic in 2020, spending on video and music content escalated as consumers have started to spend more and more time indoors mostly looking at screens. Hence, Amazon took advantage of this opportunity. Moreover, Amazon has also pursued more costly film projects as its profile in Hollywood has risen.
The company from a long time now had been interested to make big investments in video and music content as a part of a strategy to buoy Prime memberships. On Thursday, CEO Jeff Bezos announced in his annual shareholder’s letter that Amazon now has 200 million Prime subscribers, up from 150 million at the beginning of 2020. Amazon folds its music and video offerings into the Prime subscription plan, which costs $119 a year and includes other perks like free, two-day shipping.