ViacomCBS is to shut down its smaller legacy streamers, such as MTV Hits, whose content will be added to its upcoming premium service Paramount+, amid a surge in subscribers for its existing SVOD and AVOD platforms.
The decision was revealed in the company’s Q3 earnings report and comes as the US media giant prepares to launch its revamped and renamed version of the existing CBS All Access. Other platforms potentially in the firing line include Comedy Central Now, though only MTV Hits was mentioned by name.
The move is not thought to affect Noggin, Nickelodeon's top-rated subscription-based interactive learning service for preschoolers, as Marc DeBevoise, ViacomCBS’s chief digital officer confirmed earlier this year that Nickelodeon will be keeping the service operational because of its unique interactive functionality and access to games.
However, the video content on Noggin, which includes popular preschool programming such as Dora the Explorer and PAW Patrol, will eventually become available on the rebranded All Access. It's currently unknown whether the programming will be available on both platforms, or only on Paramount+.
Speaking about the closure of its niche streaming services, ViacomCBS president and CEO Bob Bakish said that this action will create a “one-time headwind to streaming subscriber growth in Q4 as we set up for a much larger streaming service longer term.”
The move comes just over a month since ViacomCBS revealed a raft of new shows and the name for its soon-to-launch ‘super service’ OTT platform, with execs also outlining the streamer’s commissioning strategy and its international plans.
It will offer content from across ViacomCBS brands, including Nickelodeon, MTV, BET, Comedy Central, CBS, Paramount Television Studios, and Smithsonian Channel, as well as movies from Paramount Pictures. It is set to launch in the US in early 2021 and will then be expanded into Australia, Latin America and the Nordics.
Pluto TV – a ‘gateway to pay’
Bakish also outlined how ViacomCBS would use its fast-growing AVOD service Pluto TV, whose CEO Tom Ryan was recently appointed at the head of a new-look streaming structure.
The CEO said that the ad-supported service would “serve as a gateway to and funnel for our pay services” with the AVOD expected to draw in potential subscribers to Paramount+, which is “on track” to launch next year.
Bakish revealed that ViacomCBS streaming services had leaped to 17.9 million domestic subscribers in 2020, an increase of 72% on the previous year. The company now expects to finish the year with at least 19 million domestic streaming subscribers, up from original guidance of 16 million.
Bakish said that ViacomCBS will also launch Pluto TV in new markets such as Brazil in Q4, followed by France and Italy in 2021.
He pointed to “strong demand for sports like UEFA and the NFL, originals like Star Trek: Lower Decks and CBS network content like Big Brother and Love Island” on CBS All Access and “the trifecta of original programming, including The Chi, Billions, the final season of Homeland” on Showtime OTT.
Covid’s content impact
Touching on the challenges posed by Covid-19 (coronavirus), Bakish revealed that despite the pandemic, original programming plans for Paramount+ are well underway with “a deep roster of original series that leans heavily on our franchises.
These include The Offer, a scripted limited series that will tell the story behind the making of The Godfather, which Bakish described as “one of Paramount Pictures’ most iconic franchises.”
He also highlighted a new edition of music series Behind The Music, as well as Real Criminal Minds, a true crime docuseries based on of CBS’ Criminal Minds and Kamp Koral: SpongeBob’s Under Years, a new original children series spun out of Nickelodeon’s SpongeBob SquarePants. Bakish also hinted that the service could look at revisiting the world of Avatar: The Last Airbender for new stories.
Paramount+ will combine lives sports, breaking news and entertainment programming with what Bakish claimed would be “a very strong original slate” of programming. He said the service would add about 10,000 additional hours to the existing CBS All Access line up between now and the launch, fuelled by the incorporation of flagship streaming brands into the combined offering.
The CEO said ViacomCBS would continue to license content to third party services because it had “too much” to profitably exploit everything on its own. He added that third-party “monetisation is overwhelmingly based on a rental model, so the IP returns to us over time for other downstream uses”.
He said that ViacomCBS was also moving towards a co-exclusive or non-exclusive licensing model for content from the likes of Comedy Central so that Paramount+ would have access to that content.
ViacomCBS posted revenues of US$6.1 billion for the quarter, down 9%, and adjusted OIBDA of US$1.1 billion, down 12%.
More Nick: ViacomCBS CEO Hints That Paramount+ Could Expand the 'Avatar: The Last Airbender' Franchise With New Show!
Originally published: Monday, November 09, 2020.
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