ViacomCBS makes its SVoD bet

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Does the world need another global streamer? ViacomCBS thinks so and has talked of plans to bring one to market, possibly an upgraded and rebranded version of CBS All Access, or maybe a refurbed Showtime.

Bob Bakish, CEO, said it “will launch a broad pay streaming product in multiple markets over the next 12 months. This service will harness the full power of the of the ViacomCBS portfolio, creating a meaningful brand presence in streaming video in key markets around the world”. Full marks for bullish optimism.

ViacomCBS does have a strong brand and content portfolio, but much of it is in segments, like music and kids, where other media, FTA, or well established SVoD streamers provide strong competition. These ‘facts on the ground’ presumably informed Viacom’s purchase and expansion of Pluto TV.

But FOMO in the SVoD market has prevailed and, it has to be said, relying on an ad-supported model is not doing so well just now. Is there another niche to be carved out alongside Netflix, Prime, Disney+, Apple TV, HBO, Hulu and Peacock?

As with Disney, Hulu and Peacock, Viacom wants to go direct to increase margins and hedge against the failure of traditional pay-TV market. But it is a much smaller company than those brands’ parents and will have to manage revenue transition very carefully. In terms of unmissable premium content, it has little ammunition under ownership: none of the comic book or sci-fi fantasy franchises, and its biggest TV show, Homeland, just finished.

Nonetheless, we can guess that ViacomCBS is thinking that some big plays must be coming in streaming and it should have a seat at the table. Does the world need this many SVoD platforms? In a post-crisis recessionary world, can consumers afford this many platforms? Can the content industry viably supply this many platforms? How much longer are investors and debt holders going to wait for returns?

Netflix flies high on every metric but profitability and has an economic model that resembles running up an ever-accelerating down escalator. Prime Video has other priorities and a parent that seems to have made itself immune to economic weather – but it could really do with a better content pipeline and its UI is the budget airline of interfaces. Apple TV is another with complicated ambitions bound into its parent’s move away from devices to services, but its progress so far hints that Apple has a lot of work to do to show that it can actually do anything other than devices. Disney+ has brand strength to burn and has got off to a flying start, but the corporation is taking serious pain in its parks business. Internationally, all the others are jogging along in the slipstream, or should that be the exhaust, of these four.

And, meanwhile, sitting out there and perhaps also feeling a little of the SVoD FOMO are Google and Facebook. At some point in the next three years, there will be an almighty game of SVoD Scrabble and who knows what names – old or newly-welded together – will score most points. But to be in the game at all, you’ve got to have some tiles in the bag.

 


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