In the world of subscription video-on-demand, Netflix (NFLX -1.51%) and Warner Bros. Discovery (WBD 0.61%) are two of the biggest players. Both offer streaming platforms that operate across multiple countries, and both have growing subscriber counts. But which of the two stocks is the better buy? Let's break it down.

Content rules everything

With the global streaming market expected to be worth almost $81 billion in 2022, competition among streamers has never been more intense. To contend with each other, the companies know they have to churn out movies and TV shows that people want to watch on a frequent cycle. This means content budgets have become somewhat of a yardstick for the streaming platforms and their ambitions.

Netflix committed $17 billion to new content this year, a figure it expects to spend again in 2023. Speaking on the company's recent fiscal 2022 third-quarter earnings, co-CEO Ted Sarandos suggested the figure was about right for Netflix. "I feel better and better about that $17 billion of content spend because what we have to do is be better and better at getting more impact per billion dollar spent than anyone else," he said.

Sarandos also confirmed the streamer will spend at the same rate in 2023, but suggested Netflix could "revisit that number" as revenue increases.

Warner Bros. Discovery reportedly planned to spend more than $18 billion on content this year, though that figure precedes the April merger that established the company. Since that time, Warner Bros. Discovery CEO David Zaslav has focused on finding $3 billion worth of cuts, which has led to the shutdown of HBO Max productions in parts of Europe and the closure of CNN+ mere weeks after it launched.

"We will not overspend to drive subscriber growth," said Zaslav soon after the formation of Warner Bros. Discovery. Instead, Zaslav suggested, the company would rely more on its deep programming library, suggesting those who "produce and control the content [intellectual property] versus those that just write checks, are positioned to win."

Chasing other businesses

Netflix has made overtures that it too understands the value in owning intellectual properties. The company has leveraged its popular Stranger Things series to produce several tie-in games for iOS and Android devices, offered exclusively to Netflix subscribers. And while the strategy has seemingly yet to take off (less than 1% of Netflix customers reportedly downloaded its games), the streamer has made clear it intends to continue along this path.

Earlier this year, the streamer revealed it was working on several subscriber-only games inspired by Netflix Originals, including Shadow and Bone: Destinies and an action title based on Money Heist. The streamer has also confirmed it is looking at going beyond mobile titles and getting into the cloud gaming space, which would pit it directly against companies such as Microsoft and Nvidia.

Netflix has not discussed how much it is investing in its gaming operation, but it has spent hundreds of millions of dollars to acquire several game studios. Netflix says gaming is a "top priority," claiming it is a key part of its long-term growth strategy.

Warner Bros. Discovery is also in the gaming space, serving as the parent company of Warner Bros. Interactive Entertainment. The subsidiary oversees several game studios, including Rocksteady Studios (maker of Batman: Arkham Knight) and NetherRealm Studios (Injustice: Gods Among Us and Injustice 2).

Unlike Netflix, Warner Bros. Discovery has a more traditional approach to its games -- distributing titles via third-party platforms and across a range of devices such as consoles, PCs, and smartphones.

This tactic is more in line with Warner Bros. Discovery's structure: It is a media conglomerate with a streaming arm, rather than a streamer with ancillary businesses. This differentiation gives Warner Bros. Discovery more breathing space should one of its businesses struggle. Netflix, on the other hand, has more exposure because it has directly tied future subscriber numbers to its success in the gaming arena.

While Netflix's approach is perhaps more risky than Warner Bros. Discovery's, it's the better option for investors looking for long-term bets. Netflix's spending is about attracting more subscribers, which directly equates to more and more recurring revenue.

Under Zaslav, Warner Bros. Discovery is focused on reducing costs and leveraging what it already owns. That's certainly not necessarily a bad strategy, but in the face of competitors that are spending more and pushing into evolving industries, Warner Bros. Discovery risks playing catch-up with Netflix down the line. And that could ultimately be a more expensive prospect.