Even as it struggles to hold onto its lead in the streaming wars with rival platforms, Netflix stated on Wednesday that it wants to invest $850 million into a production hub on the East Coast in Fort Monmouth, New Jersey, according to the Hollywood Reporter.
FACTS
- The firm purchased the almost 300-acre-old military base, which was the subject of an October New York Times article, for $55 million.
- According to the Hollywood Reporter, Netflix plans to invest an additional $850 million to construct 12 sound stages, production support facilities, and a backlot. According to Deadline, it will make it the second-largest production hub in the United States for the streaming service, behind one in Albuquerque, New Mexico.
- The Hollywood Reporter quoted Netflix’s director of content and studio affairs, Rajiv Dalal, as saying that the New Jersey location was chosen as the company’s East Coast production hub because, among other things, it has “excellent beautiful backdrops, is adjacent to major metropolitan centres, and we were able to get a wide swath of property close to 300 acres.”
- The company forecasts the production hub, which Dalal stated will be finished in 2027, would support at least 1,4000 employees and produce between $7.4 billion and $8.9 billion in output over 20 years.
- The plan is anticipated to be approved by the Fort Monmouth Economic Revitalization Authority during a meeting on Wednesday night, according to Deadline.
Background History
Earlier this year, Netflix had its first subscriber decline in ten years, reducing its shares’ value. It implemented several cost-cutting measures this summer, including the termination of 400 workers. The business reported in October that it had added subscribers and predicted the trend would continue into the fourth quarter of this year. However, the Wall Street Journal reported that the corporation was still looking to slash costs this past fall. The publication was informed by sources that would take efforts, such as eliminating corporate gifts and hiring more junior employees. However, the corporation insisted that it would continue to air new films and television shows.
DEVIATION
The Journal reported earlier this week that only 9% of subscribers to the company’s recently announced ad-supported tier joined in the previous month, which led to a modest decline in Netflix stock. Last week, Digiday claimed that Netflix was refunding certain advertising clients’ money because it had fallen short of audience projections. Netflix is “pleased with the successful launch and the member engagement on the Basic with Ads plan, as well as the enthusiasm of advertisers to join at the onset,” a spokeswoman for the business told Forbes.