Original Content Powers AMC
The company's scripted programming has garnered Emmy awards and high ratings.
AMC Networks (AMCX) has transformed its flagship AMC channel from a minor cable channel showing classic movies into a premier prestige platform for original scripted content. The transformation provides the smaller AMC with strong growth potential compared with larger rivals. However, this growth is contingent on AMC’s ability to source and cultivate strong original content as well as monetize the programs internationally.
The most widely distributed channel, AMC, reaches more than 90 million households in the United States. The shift to original scripted content was spurred by the success of its shows such as Mad Men and The Walking Dead. With a reach of 85 million households, WE tv traditionally targeted a female audience, with its recent success based on unscripted series. IFC reaches 73 million households and mainly shows independent films and alternative comedy series. The shift away from showing lower-rated movies to original scripted and unscripted shows has attracted a larger audience for AMC’s networks. We expect this to give management leverage to increase affiliate fees as the current carriage agreements continue to expire. However, AMC faces stiff competition for fees from entertainment networks that are owned by larger media peers.
Neil Macker does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.