The Town with Matthew Belloni: “Where the Money Is Spent in Hollywood and How It's Changing”

Date: September 26, 2025
Host: Matthew Belloni (Puck, The Ringer)
Guest: Scott Purdy (Media Industry Lead, Strategy, KPMG US)

Episode Overview

In this episode, Matthew Belloni dives into the shifting landscape of Hollywood’s content spending. With alarm rising across the entertainment industry about shrinking budgets and rapid change, Matt brings in Scott Purdy, co-author of a KPMG study on “The Future of Content Spend and Business Models in Media,” to unpack where money is actually flowing in Hollywood, why the headline narrative may be missing bigger trends, and what strategies will define the next decade. The conversation reveals a counterintuitive truth: while traditional scripted content is getting squeezed, platform spend as a whole is still growing—and new gatekeepers are emerging in unexpected corners.

Key Discussion Points & Insights

1. Hollywood in Perceived Crisis vs. Reality

[01:05–04:08]

• Belloni’s Framing:
  The town is dominated by talk of doom and gloom—studios are spending less, mergers loom, and content budgets are shrinking.
• KPMG’s View:
  Despite the hand-wringing, the KPMG report calculates annual content spend for 12 industry giants at over $210 billion, with nearly 10% compound growth since 2020.
  • “It’s all about the content spend.” – Matt Belloni [01:25]
  • The spend includes not just films and TV, but also sports, music, affiliate fees, and revenue shares with creators on platforms like YouTube and Meta.

2. What Counts as Content Spend?

[04:53–06:10]

• Expanded Definition:
  KPMG considers “content” to include:
  • Traditional TV and film production
  • Sports rights (e.g., NFL, global leagues)
  • Affiliate fees (cable payments)
  • Revenue share payouts to user-generated platforms and creators
  • Music
  • Social media content spend (YouTube, Meta)
• This holistic view explains why spending looks higher than perceived by Hollywood insiders.

“This study takes a wider view of what content is… it's a wide swath of the overall content ecosystem.”
— Scott Purdy [04:53]

3. The Surging Cost of Sports Rights

[06:01–08:18]

• Sports Takeover:
  Approximately 30% of global content spend by major players is now sports rights (about $60 billion globally).
  • Sports costs are growing “high single digits—8 or 9%,” even as scripted is flat or declining.
  • Every major sports deal cannibalizes budgets for movies/TV.
    E.g., Netflix’s new MLB deal ($250 million/year) is money unavailable for scripted originals.

“The people in Hollywood that are freaking out about lower content spends on entertainment content... they're not hallucinating. It is flat to down.”
— Matt Belloni [07:24]

4. Who Is Spending the Most? Comcast’s Unexpected Lead

[08:18–09:29]

• Surprise: Comcast tops the list at a $37B annual spend, beating Disney ($28B) and YouTube ($32B).
  • Reason: Comcast’s numbers include affiliate fees—payments received from distributors for carrying cable channels.
• Disney no longer owns cable platforms, giving Comcast this statistical edge.

5. The Shifting Investment Landscape: From Upfront to Revenue Share

[09:44–12:23]

• Platform & Ad-Supported Models:
  • Growth is now coming from user-generated content (YouTube, Meta) and ad-supported streamers (Tubi, Pluto).
  • Payment is less upfront, more through ad revenue sharing—risk shifting to content creators.
  • Professional content budgets are being squeezed as funds move to platform models.

“It’s a pretty significant shift… from the upfront model… to where the onus is on the content creator… That’s a pretty significant shift in where investment is going.”
— Matt Belloni [10:32]

6. Hollywood’s Future: Hybrid Business Models, Data, and Democratized Gatekeeping

[12:38–15:24]

• Platform Model vs. Upfront Model:
  • Creators may fund projects independently (sometimes via private equity), test online, and only then sell big wins to Netflix or studios.
  • IP discovered or tested on YouTube (Mr. Beast, Cocomelon) can transition to major streamers.
  • Data and audience engagement numbers now heavily influence greenlight decisions.

“It’s just a democratization of the gatekeeper model that has run Hollywood for a hundred years.”
— Matt Belloni [15:03]

7. KPMG’s Four Strategic Recommendations

[16:51–26:16]
Scott Purdy outlines four ways companies can future-proof their content spending strategies:

1. Strategic Partnerships Around IP [17:06]

• Rethink where IP comes from: Look to books, games, comics, international concepts—not just the old “pilot” system.
• AI will supplement, not replace, creative generation.

2. Greater Reliance on Data [19:00]

• Data is still under-leveraged. Understanding the who behind engagement (not just viewing stats) is the “holy grail.”
• Companies are often technologically siloed, limiting full data-driven creativity.

“There’s no one single glorious dashboard… that anyone has to be able to use to make all these different decisions.”
— Scott Purdy [21:19]

3. Hybrid Business Models That Can Scale [23:41]

• Companies must succeed in both B2B (wholesale, cable) and B2C (direct-to-consumer, streaming).
• More ad tiers, more flexible compensation for creators (pay up front AND via performance).

4. Redefine Your Investor Story [25:09]

• Metrics matter: Companies should shift from obsolete metrics (like subscriber counts) to more telling engagement and efficiency numbers.
• Each player needs to tell its own story about value, not just copy Netflix’s old playbook.

8. The Big Picture: Opportunity Amid Change

[26:16–27:33]

• Consolidation of Power: Sports and user-generated content are consuming a growing share of the pie, but this isn’t all doom-and-gloom.
• Experimentation is Key: "Cross-pollination"—traditional outlets buying from new platforms, new creators leveraging legacy gatekeepers—will increase.
• Democratization & Risk: The gatekeeping of the past century is fading, opening the field for private equity, independent studios, and creators testing directly with audiences.

“We do think those that are best equipped are those who do embrace the new capabilities and the change.”
— Scott Purdy [26:35]

Notable Quotes & Memorable Moments

• On the mood in Hollywood:
  “You talk to people in Hollywood, and it is like a doom and gloom scenario. Everyone is bummed out. The content spend is going down, down, down... but your study suggests we are not at peak content.”
  — Matt Belloni [04:08]

• On sports cannibalizing scripted budgets:
  “Every one of these big sports deals ends up taking money out of these budgets for other things…”
  — Matt Belloni [07:24]

• On the shift away from upfront investments:
  "Instead of taking out a pitch to the ten potential buyers of traditional platforms and studios, you could potentially take out a pitch for a show or a movie to a ton of money-backed ventures..."
  — Matt Belloni [14:14]

• On data’s limitations:
  “Netflix has always said they don’t know anything about their customers except what they watch. You could be male, female, transgender, 80 years old, 7 years old. They don’t know you except what you watch.”
  — Matt Belloni [20:42]

• On experimentation and optimism:
  “We’re probably going to see more of the same, but we’re going to start to see a lot more experimentation... cross-pollination between different models.”
  — Scott Purdy [27:17]

Key Timestamps

• [01:05] — Matt sets up the episode: “Who’s buying? Who’s spending? And what are they investing in?”
• [04:53] — Defining “content spend” (sports, music, platforms, affiliate fees)
• [06:01] – [07:06] — The rise of sports rights (approx. 30% of spend, and growing)
• [08:18]–[09:29] — Comcast’s lead over Disney explained
• [11:12]–[12:23] — The move to ad-driven, user-generated content platforms
• [12:38]–[15:03] — Gatekeeping shifts, the rise of independent creators, PE-backed studios
• [16:51]–[26:16] — The four strategic recommendations and deep dives into real-world impacts
• [27:17]–[27:33] — Why fear is overrated, and experimentation is the future

Overall Tone & Final Thoughts

The conversation balances measured optimism with clear warnings. While Hollywood’s old model is under serious pressure, especially in scripted entertainment, overall industry spend is still robust—and disruptors like sports and user-generated content are re-writing the rules. The next dominant players will be those who harness data, adopt hybrid models, form smart IP partnerships (even globally), and tell a clear investor story. For creators, it’s a new and more competitive game—one where “gatekeepers” are as likely to be YouTube algorithms or private equity as old-school studios.

Summary prepared for listeners who want the inside story on where Hollywood dollars go, why, and what it means for the creative business.