1.VCBS Unveils Paramount+
ViacomCBS used their investor call to give us more details about their new Paramount+ service, which, like HBO Max before it, seems to be a rather complex proposition.
The biggest news, at least from an industry perspective, is that while the higher-priced tier will feature live feeds from CBS and its local affiliates, the lower priced tier will not. And, as had previously been reported, Showtime will not be a part of Paramount+, which will be CBS and Viacom-centric. Paramount movies will have a shorter window–30 to 45 days, but nothing remotely like Warner’s same day magic.
That, and they’re rebooting Frasier, iCarly and The Real World. (The latter is actually a reunion show, but still….)
They’ll also be showing CBS’s NFL games and the Super Bowl the years they have it. And of course Bob Bakish referring to Pluto as a “FAST” was the highlight of the presentation.
Why It Matters
The live feed thing is the most curious as it would seem you’d want people on the lower tier to be able to get access to your local affiliates, but perhaps VCBS is banking on those viewers getting Paramount+ as a complement to their existing pay TV service, rather than a total replacement for it.
That seems more than a bit optimistic, given that with nine major Flixes up and running, the need for a full-on pay TV package will become less and less important, meaning affiliates might be somewhat justified in feeling thrown under the bus. (OTOH, they can put their local news broadcasts on CBSN, CBS’s freestanding–and free–local news app, but somehow I think that is not going to do it for them.)
More than any of its competitors, VCBS has a wide range of comedies, dramas and reality shows that are closely associated with the various networks under their umbrella, and that may work to their advantage, as between CBS, MTV, VH1, Nickelodeon, BET, and Comedy Central, there’s a lot of much loved legacy programming that appeals to different members of the family, and at just $4.99/month, it’s easy to see why someone might want to subscribe.
OTOH, I worry that people may look at Pluto, VCBS’s FAST and think that there are plenty of much loved reruns on there that they want to watch, and free is always going to be a better price than $4.99.
What VCBS has not let on is whether they have a strategy for creating synergy between all their many properties. As noted earlier this week, Discovery has been doing a really great job with this, using their popular linear properties to fuel subscriptions to Discovery+.
VCBS has a range of properties–Pluto, Showtime, BET+ and now Paramount+, but it’s unclear whether they have a coherent plan in place to turn this ecosystem into the sort of flywheel that drives both subscriptions and ad revenue.
Logically, VCBS would tease out a few episodes of the hotter Paramount+ original series on Pluto as a way to drive subscriptions, e.g., “Want to see more? Sign up for Paramont+.” They’d also figure out a way to encourage viewers to register on Pluto as a way of getting email addresses and then use those addresses to push Showtime and Paramount+ subscriptions, maybe even offering registered Pluto viewers a break on the price.
There’s some evidence that they are trying to create synergy–Pluto now had older Showtime series in one of their linear channels, but it’s unclear if this was a one-off or part of a more detailed plan to drive subscriptions.
The linear feed thing will be tricky too, in that it will still have commercials, and people paying $10/month to watch TV without commercials are not going to be happy with that, especially given that it will likely have linear CBS’s full complement of commercials, rather than greatly reduced ad loads commonly found on streaming.
What You Need To Do About It
If you’re VCBS, and you haven’t come up with a detailed plan on how to move viewers from Pluto to Paramount+, that should be job one. Next, you’ll want to convey the value proposition of maintaining three levels of service to consumers so that they have it fixed in their minds. That’s key because there are so many new services out there that it’s hard to keep track of them, and understanding your particular value proposition and where each of the pieces fits in will be helpful.
Finally, you’ll want to keep an eye on the wisdom of selling your top properties, like SpongeBob to other companies. I know your theory is that the more people who have access, the more well known and thus valuable the property becomes, but that might no longer be the case in this new ecosystem, so best to try and get some proof points..
[One more thing I have not yet been able to get a definitive answer to: will Paramount+ users get access to any sort of VOD or catch-up access for CBS’s linear shows. So if I miss an episode of Clarice, am I screwed or is there a Plan B? If anyone knows, ping me on Twitter at @awolk]
2. Sinclair Gets Ballys To Sponsor RSN Apps
It once seemed that Sinclair had made a really bad move buying all those RSNs from Fox for $9.6 billion, especially when both YouTube TV and Hulu Live TV opted not to renew their contracts. There was much speculation, including here, about the need for RSNs to relaunch as standalone streaming apps and the uncertainty of viewers being willing to cough up enough money to make them profitable.
One nearly universal thought was that in order to justify their existence, the apps would need to offer more than just programming–extras like discounted tickets, exclusive interviews and the like would be a must.
Sinclair, to their credit, went one step further, signing up Ballys to be a sponsor for these apps in exchange for iGaming content, sports betting and the real coup–naming rights, e.g., Bally Sports Arizona, Bally Sports Detroit, et al.
Why It Matters
As noted above, something needed to be done to rescue RSNs. They were too expensive to be kept on as part of the cable bundle, a bundle which did not have much of a future as it was, and the odds of spinning them off into standalone apps seemed low.
But Sinclair, to its credit, seems to have come up with an ideal solution.
The additional content from Ballys should benefit everyone involved. If handled correctly, it will draw in younger sports fans who are intrigued by the iGaming, fans and non-fans who are intrigued by the gambling, and the people who would have gladly paid $75/month to catch every Phoenix Suns game, but who can now get away with paying much less than that thanks to Ballys.
It also shows how outside players like gaming companies can play a major role in the world of niche streaming apps, providing content and interactivity as well as funding.
Finally, it neatly ties in the sports gambling and iGaming trends with Ballys being an extremely logical partner for those ventures, and it ultimately makes Sinclair’s investment seem like a very wise one.
What You Need To Do About It
If you’re at Sinclair and you worked on this deal, take a bow. Great job turning lemons into lemonade with a very innovative solution that will have resonance in the industry for years to come.
If you’re a niche streaming app, watch and learn: this is a great way to increase your value and your bottom line. You just need to find the right partner.
If you’re a sports fan and you’ve been stymied by YouTube and Hulu getting rid of your favorite RSN (raises hand) then take heart, because it looks like a streaming app is on the way.