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This is the year when Netflix, Disney+, Amazon and the other streaming services appear determined to demonstrate to sceptical investors that there really is no business like show business. 

These giants are set to spend more than $230bn on films and other content in 2022, double the total of a decade ago, according to the Ampere Analysis consultancy

But the scale of this expenditure, which aims to capture more subscribers and earn a lot more revenue from them, is turning a spotlight on the sector at a time of heightened scrutiny of all tech stocks. 

Streaming, which gained a huge fanbase during lockdowns, is becoming an ever more competitive sphere. 

Other names in the fray include Viacom CBS – owner of Paramount – and Warner Media, whose HBO Max gave us Succession, the family drama about the powerful media-owning Roy clan. 

Warner Media is merging with Discovery this year to create yet another contender. 

There is a particular focus on the ambitions of Apple which became, albeit briefly, a $3trillion company earlier this month. 

The group, whose Apple TV division has delivered such shows as Ted Lasso, is something of a bit part player but could easily afford to splurge billions more than its rivals in the streaming wars. 

Shares in the market leader Netflix, maker of Bridgerton, Emily In Paris and many other hits, have recently dipped. Some enthusiasts see this as an opportunity to back a company whose shares have soared by 5000 per cent to $530 over a decade. 

But, given Apple’s ample finances, is it wise to back Netflix, a $259billion business.

It will need to deliver more hits like the surprise 2021 smash Squid Game and also make a success of video games. 

Squid Game, a Korean drama about a contest where competitors play deadly versions of a children’s game, could be a metaphor for the current state of the streaming sector, in which survival will be tough and more consolidation highly likely. 

The market senses that the big profits may have now been made and that future gains will be hard won. Many agree with the assessment of Michael Nathanson of analysts Moffett Nathanson. 

He says: ‘We think we are at the cusp of an inflection in investor thinking. This isn’t a business for the faint of heart, the short-termers, or those constricted by non ethereal worries like free cash flow or net debt.’ 

Investing in any aspect of entertainment is always a thrill ride. I have shares in Walt Disney and Netflix is in some funds I hold. 

It is also in the portfolios of several well-known investment trusts, like Alliance, F&C, Polar Capital Technology and Witan, and is held by Monks and Scottish Mortgage, two trusts in the Baillie Gifford stable. 

Among the challenges facing combatants in the streaming wars is heightened US regulatory scrutiny of tech companies.

One deal that could be affected is Amazon’s $8.45billion purchase of MGM, a deal struck in order to turn the studio’s major asset James Bond into a Marveltype franchise. 

The kingdom of Walt Disney may encompass Marvel, Star Wars, Disney, Pixar and other franchises whose global appeal is supported by its resorts and theme parks. 

Yet its shares have fallen by 13 per cent to $152 over the past 12 months largely because Wall Street appears to be unsure whether Bob Chapek, who took over as chief executive a year ago, has the superpower to arrest the slowdown in sign-ups to Disney+. 

This doubt has led Morgan Stanley to lower its target price for the shares from $210 to $185, posing the question: ‘Disney has the content goods, can it execute?’ 

Goldman Sachs’s target is $205. Netflix’s growth has also been less stellar after its pandemic surge in 2020 when it added about 37m new subscribers.

In next month’s full-year results, it should announce that it has 222m worldwide, a respectable but not remarkable rise of 18.4m. 

Already there is talk that the UK may be at ‘peak Netflix’. 

Younger demographics have been won over, but older generations are more resistant, hinting that the 25-year-old company may be entering ‘its mature phase’, in the sense that early rapid expansion could be coming to an end. 

David Coombs of Rathbones says that households of all ages may limit their expenditure on subscriptions to these services as cost of living increases bite, instead relying more on free services such as those from the BBC and Channel 4. 

There will be much focus on subscriber numbers for all the companies in the streaming business over the next few months. 

A decline will hit share prices, presenting a chance to buy if you have nerves of steel. 

Long term, the performance could be dazzling but there will be many shocks and surprises on the way. 

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