Netflix Inc. (NASDAQ:NFLX) has finally shifted its priorities from passion projects to all-audience films that traditionally packed movie theatres.
The streaming service said that it is acquiring the special-effects company Scanline VFX, a Canada-based firm that has worked on several shows including, Blood Red Sky and Stranger Things for Netflix.
Netflix vice president of studio operations, Amy Reinhard said that the company would invest in Scanline’s infrastructure and workforce, and in particular, virtual production.
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“From the interstellar landscape of Cowboy Bebop and the ravenous vampires of Blood Red Sky to the exploding underground reactor in Stranger Things 3, we want to surprise and delight our members by pushing the boundaries of visual effects.” – Amy Reinhard
Scanline VFX, which employs more than 1,100 people, will become a fully-owned, semi-autonomous Netflix subsidiary.
The deal is the latest string of acquisitions by Netflix, but the terms have not been released. In a blog post announcing the purchase, Netflix said it expects the sale to close in the first quarter of 2022.
Netflix is set to spend around $17 billion this year making and licensing films and TV shows. Despite its takeover of Scanline, the business would still be working with other third parties as it continues to operate as a standalone business, the company said.
Last year, Netflix spent $1 billion making about 60 TV shows and films in the UK, its largest production base outside the US, which included The Crown and Sex Education.
Its most recent movie “Red Notice” garnered 148 million hours of viewing in its first weekend on the service, marking its most significant opening weekend record.
According to Netflix global film chief Scott Stuber, this is the culmination of four years of convincing Hollywood that the service subscriber base is worth more than any box office returns a film can muster.
PRICE ACTION: Netflix shares traded lower by 2.32% at $663.03 on Monday’s last reading.
