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Netflix's Spending Spree Continues With Signing of Big Bang Theory Co-Creator

By Andrew Tseng - Jan 22, 2020 at 10:10AM

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This news is just the latest in a series of high-profile deals the streaming company has closed with top content creators.

In January, news broke that Netflix (NFLX 7.65%) signed Big Bang Theory co-creator Bill Prady to a first-look content output deal.

That means Netflix has the right to evaluate and consider his creations before any other studio. Financial terms were not disclosed, but this is just one more example of Netflix's content spending spree, which was on pace for a staggering $15 billion last year. The streaming giant has signed a slew of big name talent in recent years, and most of their projects are still in production and have yet to hit the service.

Some of the top talent signings

One of the first big name deals came in 2017 when it was announced that Netflix had signed Shonda Rhimes to a multi-year exclusive content output deal, estimated to be a four-year deal worth $100 million or more.

Rhimes is the creator of hit television shows Grey's Anatomy, Scandal, and How to Get Away With Murder -- she had been working with Disney's ABC for the prior 15 years. Grey's Anatomy is one of the longest running scripted television shows ever created and was renewed last year for its 16th and 17th seasons. Given the upstart streaming company signed away such a big name from the establishment, it sent shockwaves through the industry.

That deal was followed up in early 2018 by a $300 million deal with prolific creator Ryan Murphy, who is responsible for Nip/Tuck, Glee, American Horror Story, American Crime Story, Feud, Posy, and 9-1-1, among several other series.

He was lured away from his former home at Fox in what became the biggest producer contract in television history. Later that year, Netflix signed Kenya Barris, creator of Black-ish, to a $100 million deal over three years.

Cameraman behind a movie camera

IMAGE SOURCE: GETTY IMAGES.

And last year, Netflix signed David Benioff and Dan Weiss, creators of the Game of Thrones television series, to a multi-year $250 million television and film deal. This was especially intriguing news, because the duo had been all set to create a "post-Skywalker" Star Wars trilogy for Disney.

But having signed the lucrative Netflix deal, the duo bowed out of their Disney deal, giving the statement: "There are only so many hours in the day, and we felt we could not do justice to both Star Wars and our Netflix projects. So we are regretfully stepping away."

And just in November of last year, Netflix and Nickelodeon agreed to a deal where Nickelodeon will create and produce original animated programming based on its library of characters. It is probably no coincidence that this news broke the day after the Disney+ streaming service launched in the U.S.

When their content is coming

The big question investors should want to know is: "When is all this content going to arrive on Netflix?"

After all, with recent streaming launches from Apple and Disney now available, not to mention upcoming services like HBO Max and Peacock, Netflix needs as much compelling new content as ever to help insulate it from the new competition. The more compelling content there is on Netflix, the more subscribers use the service. And the more subscribers watch Netflix, the more Netflix is able to attract and retain subscribers. Subscriber growth and retention are everything, the fuel for the company's growth engine. 

Information is fairly scarce, but Shondaland -- the production company owned by Shonda Rhimes -- is bringing its first project, the eight-episode series Bridgerton, to Netflix later this year. Bridgerton is based on author Julia Quinn's best-selling series.

Murphy has older content already on Netflix, but last year, he revealed that he already had ten greenlit projects under the new deal, including four documentaries, three television shows, and three movies. His first show under the new deal, The Politician, hit the service last year. Barris' first Netflix show -- Black Excellence -- is due to premiere in 2020 as well.

Certainly, more content from these three Hollywood heavyweights and many others will hit Netflix over the next few years as the projects work their way through the pipeline. For Netflix and its shareholders, the sooner the better.

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