For everyone who believes streaming TV is the death knell of traditional television, the chief financial officer (CFO) of ViacomCBS disagrees. The two can work together, and ViacomCBS is living proof.
While delivering remarks at the Bank of America Securities 2021 Media event, ViacomCBS CFO Naveen Chopra noted that Paramount+ and other streaming platforms represented about 15 percent of the company’s revenue this year. Chopra also expected that proportion to be “obviously meaningfully higher” next year.
Given that, Chopra’s next revelation was little surprise to the assembled crowd: ViacomCBS is moving resources in a bid to put more behind its streaming platforms, which means less going to its traditional linear business. Beneficiaries of this move include Pluto TV, the free, ad-supported streaming service, and premium network Showtime.
It would be easy to say that these remarks are at loggerheads. How can Chopra talk about coexistence when the company is literally cutting off traditional broadcast’s lifeblood of resources to support the growing streaming services?
Chopra offered an example to seek to prove his case, citing the recent release of the“Paw Patrol” movie. The movie pulled something of a Disney+ move, going to both theaters and to Paramount+. The result was that not only did the streaming release not hurt traditional revenue, but likely improved it. Chopra pointed out that the simultaneous release actually allowed the “Paw Patrol” movie to achieve greater revenue than expected. Had the movie only gone to theaters as originally planned, it likely would have achieved lower results overall.
In this, Chopra has a point, but it’s not quite the winner Chopra had likely hoped for. There are some issues with Chopra’s assertion that need to be considered.
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The sample size is tiny, and skewed. The proper use of statistics to support a decision tends to require a larger pool of information from which to draw conclusions. Just because “Paw Patrol” did well from a simultaneous release doesn’t mean every movie will perform likewise. There’s also a point to be raised for the nature of the content; “Paw Patrol” is generally geared toward those aged six to 11. Keeping young children out of theaters and watching at home instead is likely a good plan to their parents, so, why not take advantage? A movie geared more toward adults might not fare near so well.
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There is a big slug of evidence to the contrary. That evidence comes from Disney+, who has been experimenting with simultaneous releases for some time now. Generally, Disney has not been pleased with the results, and is looking to potentially shut down said experiment altogether with the rest of this year's lineup.
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There are already internal contradictions. Already, Viacom contradicts itself with these remarks. It admits that it’s pulling resources from traditional media to get streaming off the ground. That’s less coexistence than charity. Granted, the move likely won’t kill standard TV outright, but it likely won’t improve standard TV’s position.
So will streaming be the death of traditional TV? Chopra has a point here: it likely won’t be. It’s a safe bet that traditional TV will continue right along for some time to come. We know full well that older consumers prefer broadcast to streaming. A Harvard Business Review study seems to follow a linear progression; the older you are, and the more you’ve had interaction with linear programming, the more likely you are to stick to it. As the quality and availability of high-speed internet access improves, that progression is only likely to improve.
Perhaps streaming is not the death of traditional TV, but it’s not likely to do it many favors beyond the short term. Streaming seems to be the future, just as soon as all the infrastructure can be brought up to snuff accordingly.