Netflix Inc (NASDAQ: NFLX) is attempting for its largest acquisition yet, offering more than $300 million to acquire a Los Angeles based billboard company, according to Reuters, citing sources familiar with the matter.
Netflix is one of bidders for Regency Outdoor Advertising. There is no certainty that Netflix will win the bidding for the company, the sources said.
Regency Outdoors is owned by Drake and Brian Kennedy. The two own billboards across famous and populated areas such as Sunset Strip, a portion of Sunset Boulevard. The company also owns billboards near the Los Angeles International Airport, freeways, University of California Los Angeles, and near the Los Angeles Angels baseball stadium.
President of The Media Kitchen Barry Lowenthal, says the billboards on Los Angeles’s Sunset Strip can cost up to $140,000 a month.
These locations see heavy flow of traffic, meaning if Netflix acquires the Regency, all those billboards will advertise Netflix owned content, bolstering its publicity heavily.
Netflix has already had its content on Regency Outdoor’s billboards for its series such as “Stranger Things” and “The Crown.”
Netflix’s large acquisition attempt could be a result of the company trying to promote itself more aggressively as other competitors such as Amazon (NASDAQ: AMZN), Disney (NYSE: DIS) and Hulu begin to grow in the market.
The company previously said its in earnings call that in fiscal year 2018 it would spend nearly $2 billion for marketing expenses alone on top of the increased expenditures for its own content.
As a result of increased expenditures, Netflix increased its subscriber price back in October, which did not seem to phase the company at all.
According to data by MoffettNathanson, Netflix’s expenses per subscriber will jump around 25 percent to $16 per users, increasing from $13. Netflix reported 117.6 million worldwide subscribers at the end of 2017.
Netflix and Regency Outdoor both did not respond to comments on the matter.