Starting this summer, ViacomCBS, which will now be known as Paramount, announced on Tuesday that its streaming service Paramount+ will feature access to Showtime programs in a single integrated offering. Though the two services were previously only accessible as part of a cheap bundle, U.S. users will soon be able to upgrade in-app to a plan that includes both Paramount+ and Showtime for either $11.99 or $14.99 per month, depending on whether they want the ad-supported or ad-free service. Showtime will continue to be available as a stand-alone service, according to Paramount.
The adjustments were disclosed as part of ViacomCBS’ presentation and results announcement yesterday, which also included a corporate makeover from ViacomCBS to Paramount Global (which will be referred to simply as Paramount) that took effect today. With the global expansion of Paramount+ (which now includes a new partnership with France’s CANAL+), elevated subscriber targets, and a commitment to increase streaming content investment from $2.2 billion in 2021 to $6 billion by 2024 — higher than previous forecasts — the media and entertainment company presented its multi-year strategy to embrace streaming during the investor event.
The Paramount+ streaming service, which was previously known as CBS All Access until being renamed Paramount+ after the CBS-Viacom merger, is a big element of Paramount’s big plans. The service previously provided a mix of entertainment, news, sports, kids and family content, scripted and unscripted programs, originals, and more — and the firm stated that these investments will now continue and deepen. In 2022, Paramount plans to attract more foreign customers by releasing 50 new international scripted originals, the majority of which will be produced by its international studio VIS.
Beginning with the 2024 film releases, Paramount wants to make its service the streaming home for all new Paramount Pictures films in the United States following their theatrical runs, similar to other streaming competitors. This is a bet on the future of Paramount’s film slate — that these films will be good enough and generate enough interest that consumers who were previously able to stream these types of releases elsewhere would now be able to do so through Paramount+.
Over the next few years, Paramount plans to expand several of its popular franchises, including two more “A Quiet Place” films, a live-action “Sonic the Hedgehog” series, three more “Spongebob Squarepants” films, a new “Star Trek” film, a new “Teenage Mutant Ninja Turtles” film, and at least three more “Transformers” films. Notably, Paramount separated its Paramount+ subscribers for the first time, a statistic it had previously mixed with Showtime. According to the company’s earnings report, the Paramount+ service had 32.8 million users by the end of 2021, up from 7.3 million in the fourth quarter. In the United States, Paramount+ bragged about record subscriber sign-ups and engagement because to shows like “Clifford the Big Red Dog.”
“Mayor of Kingstown,” says the title. “1883,” “South Park: Post Covid,” live events, and NFL games are among the highlights. It benefited from local sports, such as the A-League in Australia, on a global scale. After adding a record 9.4 million total members in the last quarter, Paramount’s total streaming subscribers reached over 56 million by year’s end, earning 84 percent year-over-year growth in streaming subscription revenue. Showtime originals like “Yellowjackets” and “Dexter: New Blood” helped draw in viewers. Later this year, its new joint venture, SkyShwotime, will premiere in over 20 European markets.
Meanwhile, by the end of the quarter, Paramount’s free streaming service Pluto TV had grown by 10 million monthly active viewers to 64 million, and income had increased by 45 percent year over year to $362 million. As a result of its planned streaming initiatives, Paramount announced that by the end of 2024, it will have surpassed its global streaming subscriber goal of 65 to 75 million customers. It also increased its revenue target for direct-to-consumer sales from $6 billion to $9 billion by 2024.
“We see a significant worldwide opportunity in streaming,” said Paramount President and CEO Bob Bakish, “a considerably larger potential market than can be captured by linear TV and film alone.” “We’re optimistic about our ability to not simply compete, but to grow, producing tremendous value for both consumers and shareholders,” says the company.
How? Because we’re more diversified in four critical areas: content, streaming, platform mix, and global reach. As we look ahead, the scale of the potential we perceive is only equaled by our desire to take advantage of it,” he added. However, the company posted mixed profitability in the fourth quarter, with revenue of $8 billion, well ahead of Wall Street expectations of $7.51 billion, but earnings per share of $0.26 instead of $0.43.
Streaming revenue (which includes both ad and subscription fees) increased by 48% to $1.3 billion. Due to decreased political ad expenditure and lower linear impressions, ad income remained basically steady at $2.6 billion, up 1% year over year. The addition of theatrical, licensing, and other revenue pushed the total to $8 billion. Despite its ambitious plans, Paramount’s stock dropped more than 20% in early trading, according to Variety, owing to an analyst downgrade and investor concerns about the studio’s plans to increase streaming content spending to $6 billion, when it had previously stated that it would spend $5 billion or more by 2024.