Facebook Inc. is loosening its purse strings in its drive to become a major hub for video.
The social-media giant is willing to spend as much as $1 billion to cultivate original shows for its platform, according to people familiar with matter. The figure, which could fluctuate based on the success of Facebook’s programming, covers potential spending through 2018, one of the people said.
The investment would far outpace Facebook’s previous outlays on video content, including its live-video deals last year. It also signals Facebook’s readiness to spend more than before to become what Chief Executive Mark Zuckerberg calls a “video-first” platform.
Facebook’s thirst for video content pits it against traditional broadcasters such as Time Warner Inc.’s HBO and deep-pocketed tech companies such as Amazon.com Inc. and Netflix Inc., which all are banking on video to capture the fleeting attention of users and seize billions of dollars in advertising that is expected to migrate from television to digital video. Apple Inc. is preparing its own billion-dollar war chest for content.
This story originally appeared in The Wall Street Journal.