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CBS All Access, Showtime OTT to Top 4 Million Subscribers, Expand Internationally and Add Sports Channel

CBS Corp. is moving fast in the streaming channel arena, with plans to expand CBS All Access to Canada and other international markets by next year.

CBS is also working on the launch of a streaming sports channel patterned after its CBSN digital news service. The movement in the OTT market comes as CBS All Access and the Showtime standalone service are poised to exceed 4 million subscribers in total by the end of this year, CBS Corp. chief Leslie Moonves told investors on Monday.

“There is a huge opportunity for CBS to go direct-to-consumer on a much bigger scale worldwide,” Moonves said during CBS Corp.’s second quarter earnings call. Moonves noted that the projected 4 million total OTT subs puts the company well on its way to meeting its goal of 8 million total OTT subscribers by 2020 as the Eye spelled out to investors in early 2016.

“We’re more than halfway to our goal for 2020, which is obviously quite conservative now,” Moonves said.

Moonves said CBS All Access would be available in Canada by the first half of 2018 and would expand to more countries on multiple continents. “We will add content from across our corporate portfolio to make our service more and more attractive,” he said.

The sports channel is in the early stages of development and doesn’t yet have a name. The success of the CBSN news channel has given CBS the confidence to move forward with a sports outlet, leveraging the value of CBS’ existing sports operations just as CBSN has allowed the company to make the most of its investment in news. Moonves said CBSN was also being added as a standalone channel in some emerging skinny bundle offerings.

Those virtual MVPD offerings are beginning to contribute to CBS’ revenue base “in a meaningful way,” Moonves said. “Clearly there is a lot of upside here.” Earlier today, CBS announced a carriage pact with AT&T’s DirecTV Now.

CBS is sparing no opportunity to drive new OTT subscribers because those subs are more valuable overall to the company than traditional MVPDs. Showtime will make its highly anticipated Aug. 26 pay-per-view fight between Floyd Mayweather and Conor McGregor available for purchase via streaming even for those who don’t already subscribe to Showtime. Those who buy the bout will get a free trial to the Showtime OTT service, which should help drive a subscriber boost, Moonves said.

The return of “Twin Peaks” has also been a boon to Showtime, becoming the premium channel’s most-streamed program ever.

Moonves reiterated that the decision to relaunch the “Star Trek” franchise on CBS All Access rather than on the CBS network or Showtime, or even to sell it to Netflix in the U.S., was a calculated decision to grow the mothership OTT service. “Star Trek: Discovery,” the first new TV series in the “Trek” canon in 11 years, is set to bow Sept. 24.

“We determined that ‘Star Trek’ will be far better for All Access and will earn us more money,” Moonves said.

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