ViacomCBS will give its new subscription streaming service built on the foundation of the existing CBS All Access a soft launch later this year and is “making strides” to expand its streaming presence internationally.
The media giant outlined its new streaming strategy during a conference call with analysts following the announcement of its first financial results since Viacom and CBS re-merged late last year.
Labelling the expanded service a ‘House of Brands’ offering, ViacomCBS president and CEO Bob Bakish said it would add content from the company’s Nickelodeon, Comedy Central, MTV, BET and Smithsonian labels, as well as features from the Paramount library, to the current CBS All Access line-up. He said the service will offer a total of 30,000 TV episodes and up to 1,000 films.
Bakish said the company’s approach is “rooted in the belief that the streaming world will evolve similarly to the linear world - it will have free, broad pay and premium pay segments, and just like in the linear world we’ll have a streaming product for each.”
He added that the new service has been designed “to be compatible with the evolving distribution landscape. We see it as a value-creating opportunity to further broaden our partnerships with traditional distributors. We also see it as a robust offering for distributors in the broader OTT space, including mobile.”
Bakish told analysts that ViacomCBS is “in the early stages of entering international streaming… but we are absolutely working the international space and we’ll update you as that plays out later in the year.”
US service CBS All Access is already available in Australia and Canada. PlutoTV, the ad-supported streaming service Viacom bought a year ago, is up and running in the UK, Germany, Austria and Switzerland, with a launch in Spanish-speaking Latin America coming at the end of March.
In announcing its results for the fourth quarter of 2019 and the full year, ViacomCBS reported that its current pay streaming services - CBS All Access and the OTT service of premium cable network Showtime – have 11million subscribers in the US, up 50% year-on-year. The company expects the US total to grow to 16million by the end of 2020.
Pluto TV, the company said, currently has more than 22million monthly active users in the US, up 75% year-on-year, with that figure expected to rise to 30million by the end of 2020.
Discussing Showtime, Bakish said the network, known for original dramas such as Homeland, The Affair and the US version of the UK’s Shameless, “was a working capital headwind for the company in 2019 and the time is right to improve return on investment by evolving that programming mix.”
He said the network “will continue to be an important home of scripted shows.” But, referring to recent documentary and unscripted shows on the network, he added that Showtime “does have traction in other formats and we see an opportunity to lean more in this direction.”
For the full year of 2019, ViacomCBS reported revenues of $27.8bn, up 2% from 2018, and operating income of $4.27bn, down 18%. Among the conglomerate’s business segments, TV entertainment revenue (including results from the CBS broadcast network and CBS All Access) was up 8% for the year to $11.92bn, and cable networks revenue (from assets including Showtime, Pluto TV and the UK’s Channel 5) was down 2% to $12.45bn.
The filmed entertainment segment saw gains in licensing offset by a soft performance from Paramount Pictures, with full year revenues rising 1% to $2.99bn. The film studio has made a stronger start to this year with last weekend’s chart-topping release of Sonic The Hedgehog.