Produced content includes Netflix's library of original content that it creates itself versus original content it licences from third-party studios, such as "House of Cards" from Media Rights Capital.
According to the analyst, Netflix's strategy of creating and owning more content can help it bypass "complex" global licensing agreements and make it easier to distribute the content globally. In addition, a potential future reward for Netflix could include secondary revenue streams such as consumer product licensing and offline syndication.
On the other hand, being the owner of a property comes with greater risk if the programming is not a success.
Salmon added that he expects Netflix's produced content to grow to 8.8 percent of the total library by the end of the current year and then rise to 11.3 percent by the end of next year.
Shares of Netflix remain Market-Perform rated with an unchanged $85 price target, which implies a 41.5x multiple to the analyst's 2017 estimated EV/EBITDA.
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