How does the Netflix business model allow them to spend hundreds of millions of dollar on producing original movies and translate that to profit?

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For example, just announced is “The Gray Man” which Netflix is producing for $200M. Since the vast majority of the people who will watch it already have Netflix subscriptions how does Netflix actually make profit off this movie?
It’s not like it will encourage someone who’s subscription expires months after to hang on because of that one movie so where is the gain?

In: Economics

10 Answers

Anonymous 0 Comments

It has nothing to do with Netflix itself but the industry. In most cases people don’t make money that much money from box office. I know how some love to see how the movie “flopped” or how it was successful based on the budget/box office ratio. Usually it’s the merchandise and things like that that makes the money. The amount of toys and shirts and Gifts that stranger things alone is selling till this day is insane amount of money. Disney plus had mandalorian. The money they made from baby yoda alone is enough to cover for the entire streaming service support.

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