Incoming Paramount Owners Lay Out Company Vision; Paramount+ Rebuild on the Way
Speaking with analysts on a conference call on Monday, Skydance CEO David Ellison and oncoming president Jeff Shell laid out their plans for New Paramount.
A process whose completion appeared more than doubtful is now right on track. That process is, of course, the Paramount Global merger with Skydance Media, which has had a fitful history these past few months. But late Sunday evening, Paramount’s board of directors gave its approval to the deal, which was officially announced on Monday morning. Current Skydance CEO Larry Ellison and former NBCUniversal head Jeff Shell met with reporters and analysts for a conference call on Monday to discuss the deal and provided plenty of details on their plans for the future of Paramount+ and other company assets.
Key Details:
- Ellison spoke of the need to improve the content recommendation engine on Paramount+.
- Shell said it was time to reexamine how the company windows its streaming content.
- The new ownership team will continue to seek out joint ventures and other opportunities for Paramount+.
Paramount’s buyers had plenty to say about what they thought could improve at Paramount+. The streamer has seen modest but steady growth over the years, rising to 71.2 million customers as of the company’s latest earnings report. But Paramount+ also loses millions of dollars every year, and that has not helped Paramount offset declining revenues at its cable and broadcast channels created by cord-cutting.
So how can Paramount+ be improved? Ellison pointed to technical improvements as one part of the solution, saying that “New Paramount” intended to “rebuild” Paramount+ to become a better customer experience overall.
“[We] believe that with the technological prowess and relationships that we have, we can expand our DTC business,” Ellison said. “We can improve our algorithmic recommendation engine to basically increase time spent on the platform, reduce churn, and drive lifetime value for all of our shareholders.”
Shell also discussed the strategy for Paramount+ going forward. He was an instrumental figure in helping to get Peacock off the ground for NBCU before a sexual harassment complaint from a female subordinate caused him to be shoved out of the company. With the new regime in charge at Paramount, Shell could implement a strategy of windowing content, potentially on different streaming services created out of content now found on Paramount+ and Pluto TV. More licensing deals that allow Paramount to collect a check in exchange for letting its titles stream elsewhere could also be in the company’s future.
“I’m a big political believer in windowing strategy, and I think there’s maybe a more efficient way to maximize the value of our content while we continue to be in the DTC business… We could be a little bit smarter about licensing,” Shell said, instead of “blindly” placing titles on Paramount+.
Are More Paramount+ Bundles Coming?
The two execs also said that they would support the efforts of Paramount’s current, three-man “Office of the CEO” as it seeks out potential bundles and joint venture opportunities for Paramount+. Shell made a point of noting that as the bundling trend picks up speed, Paramount doesn’t want to be the last company standing.
“I don’t think it takes rocket science to project that the consumer situation is not sustainable, that eventually there’s going to have to be some form of bundled solution that’s easy and simple for somebody,” he said. “I personally think eventually the streaming world is going to look very similar to the way that the [cable] world looked in the past… If you’re in that bundle, you’re going to win, and if you’re not in that bundle, you’re in real trouble.”
Ellison and Shell also said that they would seek out $2 billion in cost savings company-wide, and as part of those budget cuts, Paramount+ could see more content removals. There was no official word from the two that cuts were definitely on the way, but such austerity measures have been used by Paramount before to try and save themselves some red ink. However, viewers shouldn’t expect Paramount to try and sell Paramount+ completely.
“If you look at where the audience is heading towards, streaming is an incredibly important part of the business and very much the future of the business,” Ellison said. “The way we intend to look at it is from a profitability standpoint and getting to profitability in streaming as efficiently as we can while also continuing to scale the company.”
The new direction for Paramount will continue to be plotted in the coming months, as the merger seeks regulatory approval and awaits potential legal challenges from Paramount shareholders. Followers of the story who were nervous about the potential for a shutdown of Paramount+ can likely rest easy, though it’s clear that big changes are on the way for the streamer.
Paramount Plus
Paramount+ is a subscription video streaming service that includes on-demand access to 40,000+ TV show episodes from BET, CBS, Comedy Central, MTV, Nickelodeon, Nick Jr. and more. Get free access with a Walmart+ subscription.
Paramount+ includes “1883,” “Tulsa King,” “Star Trek: Discovery,” “SpongeBob SquarePants,” and “PAW Patrol.” Subscribers can watch the NFL, college football, The Masters, college basketball, UEFA Champions League, UEFA Europa, Serie A, and NWSL. The service also offers the option to watch your live CBS affiliate. The upgraded ad-free package includes premium movies and shows from Showtime.