Amazon will increase original content spending despite imploding video team

Amazon sign on storefront
“We're going to continue to invest in video and increase that investment in 2018,” Amazon CFO Brian Olsavsky said during the company’s earnings call.

Even as Amazon Studio’s executive team is being upended amid sexual harassment allegations, Amazon is promising it will continue to increase its annual content budget.

Amazon CFO Brian Olsavsky said during the company’s earnings call that customers who watch Prime Video spend more on Amazon and that video helps drive aspects like better conversion of free trials and higher membership renewal rates.

“We're going to continue to invest in video and increase that investment in 2018,” said Olsavsky, according to a Seeking Alpha transcript.


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Olsavsky said that Amazon will continue to gather data that correlates members’ viewing and sales patterns on Amazon, and use that to make “midcourse corrections” to the video strategy and how to invest the content budget.

“So we remain very bullish on the video business, and we're looking forward to a lot of interesting new projects at the back end of this year and also lined up into next year,” Olsavsky said.

This year, Amazon is spending an estimated $4.5 billion on original video content, which still puts it far behind the $7 billion to $8 billion SVOD rival Netflix intends to spend in 2018.

RELATED: Amazon suspends programming chief after sexual harassment claim

While Amazon still sounds confident in its video strategy, the company is dealing with the fallout of sexual harassment allegations against former programming head Roy Price, who resigned his position earlier this month. Albert Cheng, who serves as chief operations officer for Amazon Studios, took over Price’s duties in the interim.

Amazon has also said goodbye to Joe Lewis, head of comedy and drama, and Conrad Riggs, head of reality programming. Morgan Wandell, Amazon’s chief of international, recently left the company to join Apple.

According to the Hollywood Reporter, two producers currently working on shows for Amazon said the changeover will be a good thing for Amazon.

During a panel at the Hollywood Foreign Press Association, “Goliath” co-creator David E. Kelley said the turnover “can only be a good thing” for Amazon, which he said was “not well-run.”

Jill Soloway, creator of “Transparent” and “I Love Dick,” said she had faith in Amazon CEO Jeff Bezos and that the company would take necessary steps to change the workplace culture in Amazon’s video division.

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