ViacomCBS Details Plans to Bulk Up CBS All Access and Accelerate Streaming Growth

CEO Bob Bakish reveals company's plans for streaming dominance

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CBS All Access will be expanded with about 30,000 television episodes from Viacom brands like Nickelodeon and Comedy Central, as well as Paramount Pictures films. ViacomCBS, CBS All Access
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ViacomCBS will “soft launch” an expanded CBS All Access offering later this year as it looks to bulk up the streaming service and better position the newly combined company to take advantage of the growth in the OTT space, CEO Bob Bakish told investors Thursday morning.

In its first-ever earnings presentation following the CBS Corp.-Viacom merger last December, the combined ViacomCBS outlined its path forward in the streaming space. The company wants to focus on three streaming services: a free ad-supported offering (the AVOD service Pluto TV), a mid-level SVOD service (CBS All Access) and a premium SVOD offering (Showtime OTT).

“We believe this combination of free, broad pay and premium pay is where the market will grow,” Bakish told investors. “The fact that we have product in two of them—in free and premium, and very quickly we will get into the third, the middle one—makes a lot of sense. We’re building from a position of strength.”

To do it, the company will expand All Access with about 30,000 television episodes from Viacom brands like Nickelodeon and Comedy Central, and will add up to 1,000 films from its Paramount film studio, according to Bakish. The bulked-up CBS All Access will also feature a more robust offering of live television in addition to its library of on-demand content.

The company will also leverage its expanded portfolio on the linear side. The next season of RuPaul’s Drag Race All Stars, a VH1 series, will air first on Showtime in June. “With a large and loyal following, we believe this franchise will be additive to Showtime’s subscriber dynamic,” Bakish said.

And Showtime’s channel Showcase will be rebranded as Sho*BET, focusing on African American scripted programming from Showtime and BET.

Bakish confirmed Adweek’s reporting from last week that ViacomCBS will reconfigure CBS All Access as a “house of brands” and that Pluto TV would remain a standalone service. But whether All Access will be renamed, and how extensively the company will overhaul the platform, remains unclear. Bakish said the company plans to release more information about its plans in the coming months.

However, Bakish emphasized that ViacomCBS was building off of its existing technology and platform for CBS All Access, and would not roll out an entirely new offering. “We’re not launching new here,” Bakish told investors. “We’re working off of proven platforms and models, and we know how to work with partners.”

When CBS Corp. and Viacom combined their assets last year, it created a considerable portfolio of streaming services, including the broad-based subscription service CBS All Access, free ad-supported services like Pluto TV, and a collection of more focused subscription services like BET+ and Nickelodeon’s Noggin. At the time of the merger’s completion, Bakish said the transaction positioned the combined company “to be a global leader in DTC;” on Thursday’s call with investors, Bakish doubled down on this assertion.

The company had 11.2 million combined domestic subscribers to CBS All Access and its Showtime OTT offering at the end of the quarter, the company reported Thursday, and expects to reach more than 16 million subscribers by the end of the year. In December, Bakish had said that CBS All Access and Showtime OTT had a combined 10 million subscribers. Prior to merging with Viacom, CBS had targeted a figure of 25 million combined subscribers to the two services by 2022.

On the AVOD side, Pluto TV now has 22 million monthly active users domestically, and ViacomCBS projects that figure to grow to 30 million by the end of 2020.

Overall, the company brought in $1.6 billion in annual revenues from its streaming and digital video advertising business, a 60% year-over-year increase. Bakish said it aims to grow that revenue by 35-40% while keeping costs modest.

Part of ViacomCBS’ strategy to continued growth in the space includes an effort to leverage the company’s own IP to strengthen its streaming and linear offerings. Following the success of CBS All Access series Star Trek: Picard, which Bakish said “broke records” for both streaming totals and subscription sign-ups, the company is producing two more Star Trek series (one at All Access and one at Nickelodeon), and has two other franchise series in development. And the company is looking to identify valuable IP from its Paramount Pictures film library to leverage across its streaming, linear and film businesses, he added.

Going forward, ViacomCBS will roll back some of its content licensing as it looks to bolster its own libraries, but will continue to license out some programming to streaming competitors. Nickelodeon is creating SpongeBob SquarePants spinoff series for Netflix, for example, and several months back sold exclusive domestic streaming rights to Comedy Central’s adult animation series South Park to WarnerMedia’s upcoming streamer HBO Max. Bakish emphasized that it thought about those deals as rentals, and that the company will scale back exclusive licensing deals to third parties.

“These are assets we own, and we expect to monetize them in different ways over time,” Bakish said.

The company is also in the “early days” of building out a more international streaming offering. It will debut Pluto TV in Spanish-speaking Latin America at the end of March and later Brazil; by the end of the year, ViacomCBS will have 80 channels in Latin America, Bakish said.

ViacomCBS’ plans to take advantage of the streaming space comes as cord-cutting accelerates and television entertainment giants look to find a foothold in the direct-to-consumer world. As Netflix, Hulu and Amazon Prime Video continue to invest in their businesses, more competition is coming into the space: Disney+ debuted in November and has since ballooned to nearly 30 million subscribers, and both NBCUniversal and WarnerMedia are readying major offerings that will premiere in the coming months.

Bakish said the company stands out from its competitors because it already had a foothold in the space. “It’s not like we’re ramping from nowhere—we’re building momentum,” he said.

As ViacomCBS prepares for its first upfront this year, Bakish emphasized his confidence in Jo Ann Ross, who was selected as ad sales chief of the company last October. “I’m thrilled with Jo Ann’s leadership, and I’m confident we’re going to be extremely well-received in this upfront,” Bakish said during the call. “I’m extremely excited about our domestic ad picture.”

@kelseymsutton Kelsey Sutton is the streaming editor at Adweek, where she covers the business of streaming television.