ViacomCBS CEO Bob Bakish told investors Thursday the CBS All Access subscription service will undergo a rebranding soon as it expands to incorporate more of the company’s cable brands and library programming.
Speaking on the company’s quarterly earnings call, Bakish also said ViacomCBS is planning to launch a “broad pay streaming product” in multiple international markets over the next 12 months.
CBS All Access will see a user-interface overhaul this summer in preparation for a relaunch with a new name farther down the road. As of Thursday, 100 titles from Paramount Pictures vast film library, including “The Godfather” trilogy, will be made available to CBS All Access subscribers.
CBS Corp. was a pioneer among traditional entertainment giants in taking the network and its library over the top in October 2014. The makeover plan under way calls for the service to add more current and library shows from ViacomCBS cable brands such as Comedy Central, Nickelodeon, BET, Smithsonian, MTV and Paramount Network. Those brands will also produce original content for the expanded All Access down the road, Bakish said.
In short, Bakish promised “major changes coming this summer as we track toward the rebrand and relaunch of a transformed product.”
ViacomCBS chief financial officer Christina Spade said the CBS All Access and Showtime standalone services at present have 13.5 million subscribers in total and are track to hit 16 million by year’s end.
ViacomCBS’ first-quarter earnings were soft, but the market liked what it heard from Bakish. Along with Q1 earnings, ViacomCBS disclosed Thursday morning that it has struck a distribution pact for 14 channels with YouTube TV, making the core Viacom cablers available to Google’s digital MVPD for the first time.
The YouTube TV distribution pact coupled with the Verizon Fios carriage renewal pact unveiled last month helped goose ViacomCBS’ share price in early trading Thursday. Shares were up more than 13%, a welcome gain after weeks of market turbulence that pushed ViacomCBS shares below $15.
CBS All Access also reached a milestone Thursday in rolling out as an app on the home-page hub of Comcast’s Xfinity platform. That kind of MVPD distribution — making the app front-and-center for active pay TV customers — is coveted by all subscription streamers.
Bakish also talked up the growth of the ad-supported Pluto TV platform. He called it “the fast-growth, broad-reach gateway to the ViacomCBS streaming world,” meaning that the free Pluto TV service be a magnet to draw paying subscribers to the enhanced CBS All Access and Showtime apps.
Pluto TV at present has about 24 million active monthly users in recent — a number that is expected to reach 30 million by year’s end.
As ViacomCBS looks to ramp up what Bakish called the company’s “owned and operated platforms,” the focus will be on preserving the biggest content franchises for in-house services. ViacomCBS will be more selective about licensing its library content to rival outlets, such as the $500 million pact struck last October with WarnerMedia’s HBO Max for the rights to Comedy Central’s enduring “South Park.”
Bakish said the coronavirus lockdown situation should not have much of an impact on the programming pipeline for ViacomCBS’ key networks in the near term, “assuming we can get back in production albeit with modifications by midsummer.” He noted that concerns about the possibility of a writers strike occurring this year — something that no longer seems to be on the horizon– drove CBS to ensure “it had a backlog of shows ready to go.” Showtime should also be well positioned through the third quarter, he added.
The future of Showtime has been a subject of speculation since Viacom and CBS Corp. completed their nuptials in December. Bakish’s comments earlier in the year about bringing more unscripted programming to Showtime raised questions about a larger shift for the premium TV outlet.
“Our 2020 plan is about turning around the performance [of Showtime] with respect to earnings and cash flow. It has real momentum on subscribers, particularly over the top,” he said. “From a content perspective, we’re excited about where we’re taking this.”
The chill on business activity from the COVID-19 shutdown has taken a toll, particularly in ad sales at CBS’ local stations. On Wednesday, Fox Corp. executives said local ad sales for the current quarter were pacing down about 50% from the year-ago benchmark. For CBS, the picture “is not as bad as what Fox is saying but it’s not pretty either,” Bakish said.
On the production side, dozens of projects have been shuttered, but there’s also been “substantial near-term cash flow savings” as planned expenditures were hastily canceled, he said.
Paramount Pictures hopes to stay on track with its planned early August theatrical release of animated movie “The SpongeBob Movie: Sponge on the Run,” which was rescheduled from a planned premiere this month. Paramount made a quick decision last month to sell the action-comedy “The Lovebirds” to Netflix given the uncertainty around exhibition. “We saw an attractive monetization opportunity in the early COVID environment,” Bakish said.
Two highly anticipated releases also disrupted by coronavirus — “A Quiet Place 2” and “Top Gun: Maverick” — will be rescheduled when conditions for theater-going improve, Bakish said.
“We’re not going to light these negatives on fire,” Bakish said. “We’re going to open them when it makes sense to open them.”