Amazon, Netflix spend billions in content race, but competitors like YouTube are sneaking up

Today, I'm taking a stab at how much three major online video providers--Amazon, Netflix and Hulu--are spending to acquire existing content and produce original content. It's not as easy a task as some imagine, because only Netflix, to keep its investors happy, is really open about its specific content spending habits. For Amazon and Hulu, it's a guessing game. But it's not difficult to imagine that both providers have crossed or are about to cross the billion-dollar content acquisition threshold.

Here's the thing: As these SVOD providers scramble to put up original series to attract more subscribers, a number of other OTT players are almost calmly stalking them. Google-owned YouTube, search engine and multimedia giant Yahoo, and live-streaming upstarts including Twitch and WWE Network are all stealing eyeballs.

YouTube, in fact, is rumored to be in negotiations to buy Twitch, a move that could give YouTube a significant advantage in live-streaming services.

"From a YouTube perspective, what Twitch has actually deployed is a globally capable platform in multiple data centers around the world," Julian Wheeler, strategy and marketing director for Interxion, a data center provider, told FierceOnlineVideo. "They've been able to deliver high quality of service for viewers and players. That technology platform is the first thing YouTube would get out of it."

The ability of Twitch's platform to scale--a feature developed by Justin.tv, which spun Twitch out of its other media genres--could be a compelling attraction for YouTube.

"It's designed for live events to scale on an enormous basis as well and YouTube could exploit it into other genres as well," Wheeler said. "YouTube would bring that ability to scale faster than the success Twitch has already had. In terms of global dominance, with YouTube's reach behind Twitch … you would get a de facto standard for (gaming and live events)."

That added benefit for YouTube viewers and advertisers--YouTube's model is, of course, ad-supported rather than subscription-based--would make the service a formidable competitor for all three of the SVOD providers profiled in today's feature.

Take a look at our snapshot of the content spending planned by Netflix, Amazon and Hulu, and feel free to put forward your own estimate in the comments section.--Sam

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