Which pricing strategy do major streaming services like Netflix and HBO Max primarily use to determine the budget for their original film and television productions?

The film and television industry has been transformed by subscription-based streaming platforms. These services have not only changed how we consume content but have also revolutionized business models in entertainment. This trivia question explores the economic strategy behind original content production for major streaming services and how they calculate the return on their massive investments in exclusive programming.

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Value-based pricing, where budgets are set based on projected subscriber acquisition and retention value
Cost-plus pricing, where production costs are calculated first and a standard profit percentage is added
Competition-based pricing, where budgets directly match what competing services spend on similar content
Dynamic pricing, where budgets fluctuate based on real-time viewer data during early production phases