M+E Connections

ViacomCBS is seeing “incredible momentum” in its Paramount Plus and other streaming services, according to Bob Bakish, the company’s CEO.

After announcing its best week ever for streaming in November, November turned out to be “our best month ever” for streaming, he said Dec. 7 at the UBS Global Technology, Media and Telecom (TMT) Virtual Conference.

The company is seeing “real momentum, both in terms of subscriber additions as well as in total consumption and, on the addition side, as we said on our last earnings call, we see Q4 accelerating versus Q3,” he told viewers. “In fact, sitting here today, that acceleration is going to be greater than I thought when I made the comments on the call” Nov. 4.

2021 “has been an interesting year for all of us,” he said. Now, “we really have a content engine that’s firing on all cylinders… with strength at CBS, at Showtime and our basic cable networks and then film,” he noted.

For the current quarter (Q4) fourth quarter, “total streaming revenue for the company will now cross a $5 billion run rate,” he projected, adding: “We’re getting somewhere significant pretty quickly. And we’re set up well for ‘22, both on the content side and with important new distribution deals kicking in, including T-Mobile on the wireless side in the U.S. and Sky in Europe, and we’ll also be launching a significant joint venture in Europe with Sky Showtime. So, ‘22 will be a big year for us, particularly internationally.”

This year has been, “at the core, about the launch of Paramount Plus” and 2022 is “really about global expansion,” he said. “Not to say we’re not going to do a lot in the U.S. We are. But the international story is going to be really big in ‘22 because what we’re doing is we’re leveraging that international infrastructure, the on-the-ground resources, the relationships, etc., to quickly drive our streaming business outside the United States. We did a bunch of that in 2021. We launched in 25 markets, including Latin America, including the Nordics, including Australia. ‘22 is about expanding into Western Europe, including in partnership with Sky.”

Also on tap is the coming launch of Sky Showtime, a 50-50 equity joint venture that he said “will target roughly 90 million broadband homes in smaller, mostly Eastern European markets.”

ViacomCBS “had no plan to launch in those markets [before] this joint venture for at least two years,” he noted. Therefore, the joint venture “brings that timeframe forward significantly,” he said. “We also believe it will allow us to penetrate those markets, which, again, are smaller, midsized markets, faster and in a more cost-effective manner and preserves capital for the larger markets.”

ViacomCBS will “continue to focus on really two priorities, which [are] driving streaming and maximizing the contribution from our legacy business,” he pointed out.

What stands to help it achieve those two objectives in the near future, he said, is that “we’ve got a fantastic pipeline on the content side, including… a killer film slate,” he told viewers. “As we look to theaters reopening at scale,” that film slate includes new Mission: Impossible, Scream and Transformers movies, Sonic 2 and Top Gun: Maverick in 2022, he said.

All of those films are “pretty much in the can” with the exception of the Sonic sequel that he said “still has a little more work” that needs to be done. Overall, “we’re in great shape from a production standpoint,” he noted.

ViacomCBS then has “more drivers kicking in for streaming, both in the U.S. and internationally,” he said.

The company plans to hold a “significant” investor event in early 2022, “where we’ll update you on our streaming performance,” he told viewers, adding: “We’ll talk about content. We’ll talk about international expansion. We’ll talk about an updated set of overall goals. And we’ll be providing all of you enhanced transparency through new segment disclosure.”

On the consolidation front, he said: “I think there’s certainly potential for additional consolidation in this industry, particularly with respect to the smaller players and there’s some narrative around that with some companies as we speak.”

Although ViacomCBS “will certainly look at opportunities in that regard,” the company is “going to continue to focus overwhelmingly on organic execution because that’s where we see material value creation ahead,” he explained.