Viacom CEO Bob Bakish has long insisted this product was on the way. (André-Pierre du Plessis/Flickr)
Many streaming packages include a number of live sports channels, but Viacom, Discovery, and the other companies involved believe there's a market for an entertainment-focused bundle. According to the report, the package will include "nonfiction and lifestyle programming, children’s fare, and scripted dramas."
While the exact list of networks and channels hasn't been finalized, sources say the parent companies expect their core channels to be part of the forthcoming bundle. Viacom owns Nickelodeon, Nick Jr., TeenNick, Nicktoons, MTV, Comedy Central and BET, while AMC and A+E each have their own suites of networks. Aside from its namesake channel, Discovery owns several others, including ID, TLC and Animal Planet. Meanwhile, Scripps, which Discovery is on the verge of acquiring for $14.6 billion, is the parent of channels including HGTV and Food Network.
Today’s report provides some additional color for a product that Viacom CEO Bob Bakish has insisted is in the works and scheduled for release in the coming year. Back in May, Bakish criticized current TV streaming bundles for not being "transformational" enough. He explained he believes the truly transformational services will be those that give customers "a new entry segment at a much lower price point," possibly with optional sports programming. Current services offered by YouTube and Hulu include a number of sports networks and are priced between $35 and $40 per month. A new service at a $20-per-month price could be enticing for some users, particularly those who lament paying for sports programming they never watch. “We fundamentally believe a lower-price offering would be very compelling,” said Bakish, adding that it would likely not involve all of Viacom’s channels.
The decision taken by the consortium of media companies to join forces makes sense on several levels. Firstly, the frequent inclusion of sports programming in cable TV packages has attracted plenty of controversy as many of these channels are responsible for pushing up subscription costs. This situation has angered plenty of non-sport fans, who are forced to fork out extra for channels they have little interest in watching.
Furthermore, some of the companies behind this new, non-sports streaming service have been left out of popular skinny bundles offered by the likes of YouTube and Hulu. Banding together could help to increase their exposure, particularly if their non-sports offering strikes a chord with consumers.
The new bundle is said to be provided through a service called Philo, which has focused on providing TV streaming services to college campuses. The bundle could also be named "Philo" as well, but it won't be known for sure until the product is announced. The package will likely include popular channels from Viacom, including Viacom's Nickelodeon, Nick Jr., TeenNick, Nicktoons, MTV, and BET; Discovery-owned ID, TLC, and Animal Planet; and Scripps-owned Food Network and HGTV (Discovery is in the process of acquiring Scripps as well). As Viacom CEO Bakish has noted before, and as today's report indicates, that still leaves out a bunch of entertainment programming from broadcast networks including ABC, CBS, Fox and NBC. Customers would require users to use an antenna in order to provide them with over-the-air signals to get those channels or pay for another subscription service that includes them.
The report also suggests that the founding media companies will launch the service as a direct-to-consumer package and then try to get established pay-TV providers to offer similar streaming packages to their customers. That will likely be difficult and take a lot of negotiations: some major media companies including Disney have agreements with pay-TV providers that state certain channels must be included in packages that reach a large percentage of subscribers. That makes it hard for TV providers to exclude those channels from any subscription tiers.
Nickelodeon launched its own standalone ad-free, video subscription service for preschoolers called NOGGIN in the spring of 2015, the SVOD features hundreds of iconic, full-length library episodes, interactive play-along videos, short-form videos, educational content, music videos featuring preschoolers’ favorite Nickelodeon characters, and more, with new content added weekly.
Consistently ranking at the top of the charts in the Family and Kids categories, the NOGGIN App is one of the top 10 grossing Kids apps on the Apple App Store, in addition to being the number-one grossing app for Music and Video in the Family Category on Google Play. The app is also available for Apple TV, Amazon Fire tablets, and Roku devices. Launched in the spring of 2015, the app currently includes 25 series, including the recently added Yo Gabba Gabba!, Trucktown, Miffy and Friends and Teletubbies. Other titles include Dora the Explorer, Blue’s Clues, Go, Diego, Go! (a Dora the Explorer spinoff), Franklin, The Backyardigans and Pocoyo. Also joining the lineup soon are Zack & Quack (26 episodes) and Peppa Pig (44 episodes) in October and November, respectively.
Sources: Ars Technica, Investopedia, FierceCable.
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