|
SEPTEMBER 17, 2019 / 4:25PM, CBS - CBS Corp and Viacom Inc at Goldman Sachs Communacopia Conference
|
Why do you prefer this approach of a more of a hybrid model or a more targeted niche model versus what
Netflix has been pursuing?
Robert Marc Bakish - Viacom Inc. - President, CEO & Director
Sure. So what you have in ViacomCBS, in the streaming space is, the bringing together of 2 streaming growth strategies that are both producing growth. On the
Viacom side, that is a Pluto-driven, ad-supported free strategy, which again is relatively early. When we acquired the company in January, it had 12 million monthly actives. As of the end of August, which
was, we referenced for our last earnings call, we had 18 million monthly actives. So 50% growth in 6 months and the growth on a per monthly active consumption basis is higher than that.
So and by the way, it has plenty of track ahead. We continue to add content. By the way, we added the NFL as a channel. We continue to add new markets,
whether thats U.S. Hispanic, which we launched in July 1 of this year or international, were now in the U.K., Germany, Austria, Switzerland, we launched all of Latin America early in calendar 2020. We believe that has long track ahead of
it. Simultaneously and independently, CBS pursued a pay strategy, SVOD. CBS All Access, Showtime All Access. They now have over 8 million combined subs, on track to be at 25 million by 2022. So those strategies were both working
independently and importantly, we both have experience executing.
Now you bring them together. And you have what Ive started to call this
ecosystem, where you can bring people in, in free. And by the way, some people will only stay in free, thats fine. We can monetize them there. Others, we have an opportunity to upsell to pay product, whether thats a CBS All Access
product, a Showtime Noggin product, the BET plus, were launching BET Plus on Thursday or some combination of that.
Should those consumers decide to
take a pause on their subscription, which is very common in SVOD, we can retain them in the free ecosystem, continue to monetize them through ad sales and be positioned to remarket to them when their situation changes or new content comes available,
et cetera. So we think that is a powerful idea. Again, weve been operating that independently and we look forward to bringing that together.
The
other thing Id say and so thats 1 point of differentiation. The second point of differentiation comes to content. Sure, were going to have entertainment content. Were going to have scripted content. Were going to
have unscripted content, where we are a market leader particularly on the Viacom side. Add to that, were going to have news, were going to have sports. Thats all national content. Were also going to have local content and
were going to have international content and its going to be across all demographics, whether its 2 to 11s, 18 to 34s, 49s, 25, 54s, African-American, Hispanic, et cetera.
So we think there are many points of differentiation. And the last one is, we dont see this as only a D2C business. We believe theres tremendous
power in working with distribution partners. Even today, what people call D2C often has partners involved in it and so this partnership approach, which were already engaged in, things like working on our
ad-supported free product Pluto, with a distributor like Comcast and Cox, both are who are distributing it not only to broadband-only, but through video bundles, we see that as another point of
differentiation. So were tremendously excited about the opportunity that this combined company has in the streaming space.
Andrew M. Borst -
Goldman Sachs Group Inc., Research Division - VP
And when youre thinking about the SVOD versus AVOD opportunities, what type of criteria are
you using to determine where the content fits best?
Robert Marc Bakish - Viacom Inc. - President, CEO & Director
Well again, this is something that in the Viacom side, weve been looking at we have 165 content suppliers on Pluto today, which is our ad-supported free product. Of that, 2 of those content suppliers are Viacom and CBS. CBS on a pre-deal basis. They distribute, for example, CBS News. So we have a team that
looks at that and says what is the opportunity in the free space and how do we develop a very compelling offering?