Weekly E-Newsletter

CBS and Viacom Close Their Merger

CBS and Viacom are finally, really, back to together. Less than four months after announcing their intentions to rejoin as one company, the companies closed their merger on Wednesday, beginning the new ViacomCBS era.

The merger took effect following the closing bell last Wednesday. ViacomCBS Inc. will begin trading on the Nasdaq on Thursday under ticker symbols VIACA and VIAC. The move puts the CBS broadcast network, Viacom’s stable of cable channels like MTV and Nickelodeon, and the Paramount film and TV studio under one roof.

Source: TheWrap

The Take

The ViacomCBS era has officially begun. After severing ties nearly 14 years ago, CBS and Viacom are back together. So how does ViacomCBS stack up to other streaming behemoths?

For starters, the combined company boasts a library of 3,600 film titles and 140,000 TV episodes that it will distribute across affiliate and owned-and-operated platforms. According to previous estimates, ViacomCBS is outspending Netflix, Amazon, and Apple on programming.

Together, CBS and Viacom lead the industry in U.S share of linear viewership, at 22%.

As we mentioned in last week’s newsletter, ViacomCBS will continue CEO Bob Bakish’s “arms dealer” strategy by renting IP and signing massive deals with streaming platforms desperate for content, such as WarnerMedia (who acquired the rights to South Park for more than $500 million) and Netflix (whose film library has shrunk 40% since 2014).

“Every single one of the services that are either in the market today or are announced are doing business with us on an original production basis, so we are in clear demand,” Bakish told CNBC in September.

On the direct-to-consumer side, ViacomCBS has a diverse portfolio of ad-supported and subscription-based offerings that the company can build a sales funnel against. These include, with estimated subscriber/active user counts:

  • CBS All Access: 3.8m subs
  • Showtime OTT: 4.2m subs
  • Pluto TV: Recently reached 20 million monthly active users 
  • Noggin: About 2.5 million subs
  • BET+: Just launched on September 19, 2019
  • Others, including NickHitsMTV Hits, and Comedy Central Now. These channels can be primarily accessed via affiliate platforms such as Amazon Prime Channels.

CBS previously predicted CBS All Access and Showtime OTT to collectively account for 25 million subscribers by 2022. Only time will tell whether ViacomCBS intends to combine some of these products together or keep them separate entities.

As Streaming Wars Heat Up, Consumers Say They’ll Drop Some Services to Try New Ones

As the streaming wars intensify, viewers are starting to adjust their consumption habits accordingly, and there’s new data to prove it. About half of consumers polled in a new survey say they intend on subscribing to new OTT services—but about two-thirds of that group say they’ll downgrade or cancel one of their existing video services in order to do it.

The data comes from a new PwC report that shows what’s at stake as old and new media companies fight for market share and customers.

In the poll, 26% of consumers said they are satisfied with their current video services, but half of them say they intend on subscribing to new OTT entrants in the market, which include Disney+Apple TV+, and forthcoming services HBO Max and Peacock. More specifically, 64% of those respondents say they’ll either downgrade or cancel their existing streaming video services to sign up for new ones. And a quarter of consumers said they are actively looking to unsubscribe from some of their services.

Source: Adweek

The Take

There’s been no shortage of debate between streaming services doing all-at-one drops or weekly releases.

According to a recent Hollywood Reporter poll, younger Americans prefer to watch TV episodes all at once.

While everyone’s debating whether users want to binge all at once or digest episodes on a weekly basis, there’s a sleeper cohort out there nobody is talking about. And that’s the user who will intentionally avoid an entire season of a show just to be able to binge episodes at their own pace. Similarly, there are users that will hold off on a few series on a given video service and then once a year subscribe for a month and watch them all that month.

If you’re a streaming service, this is important. Just because you release a show over the span of several months, that won’t always translate into several months of subscription revenue.

Let’s use season 3 of ‘The Handmaid’s Tale’ on Hulu as an example. The season debuted on June 5th and the final episode of the season was released on August 14th.

To watch the season on a weekly basis, would have cost you approximately $17.97 in subscription fees (with ad-supported Hulu @ $5.99/month). If you signed up after the finale and we’re able to consume all 13 episodes within a single month, you would only pay $5.99 in subscription fees.

Some may want to, but this is not at all about “gaming” the system. This is about consumer preference. And the entire OTT industry was created on consumer preference. Remember when we all wanted to “watch what we want, when we want, and where/how we wanted?”

And if users want to watch all 13 episodes of ‘The Handmaid’s Tale’ over a weekend, they might wish to activate their subscription until after the season finale.

So whether you’re dropping episode all-at-once or weekly, it may not really matter. Users are going to watch how they want. What matters the most is that your library has enough titles that your customers are engaged on a weekly basis.



DAZN Gives Away Content to Punch Up Subscriber Base. The Wall Street Journal

NFL TV Rights: How the League Aims to Block an Upheaval. Hollywood Reporter

Netflix to Invest $400M in Indian Content, Says CEO Reed Hastings. Hollywood Reporter

FuboTV says average hours watched up 135%. FierceVideo

HBO Max Is ‘The Key Aspect’ of AT&T’s Video Strategy, CFO Says. Variety

‘The Irishman’ Draws 13.2 Million Viewers in First 5 Days on Netflix, Nielsen Says. TheWrap

Plex Launches Free, Ad-Supported Video Service in 200-Plus Countries, Territories. Variety

Sky Plans New U.K. Studio for Online Streaming War. Bloomberg

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