CBS CEO: No OTT Plans for Showtime20 Sep, 2012 By: Erik Gruenwedel
Les Moonves reiterates support for licensing canceled programs on Netflix
CBS Corp. CEO Les Moonves Sept. 20 quashed speculation that the media company’s premium television operator, Showtime Networks, would anytime soon bow a standalone streaming service akin to Netflix and Hulu Plus.
Speaking at the Goldman Sachs Communacopia Conference in New York, Moonves said Showtime continues to rival HBO as a must-see pay-TV channel — a reality he said he doesn’t want to undermine by mining for incremental revenue as a separate subscription video-on-demand service.
Indeed, with more than 60% market penetration in domestic cable households, Showtime features original series “Dexter,” “The Big C,” “Californication,” “The Borgias,” “Homeland,” “Nurse Jackie” and “The Green Room,” among others.
Popularity of those shows has led some observers on Wall Street to suggest CBS and Time Warner’s HBO spin-off separate SVOD platforms to capture incremental revenue. Moonves said doing so would cause waves, especially among the multichannel video distributors that currently pay significant fees carrying Showtime.
“I know OTT may be the future, but why mess with this if the system is working and possibly miss off your partners [in the meantime]?” Moonves said.
The CEO said the possibility of a standalone Showtime SVOD service could lend itself in the future as the OTT market — spearheaded by Netflix — evolves. The SVOD pioneer is a primary licensee of repurposed CBS programming no longer aired on CBS — a relationship Moonves characterizes as a gift that keeps on giving.
He said SVOD services continue to flourish with new players approaching the network programming every day. Moonves reiterated a basic requirement that emerging digital distributors pay upfront for programming instead using it for free to grow their businesses.
The CEO recalled an early meeting with Apple’s Steve Jobs who was looking for content for the upstart iTunes platform. Moonves said Jobs wanted CBS fare put on iTunes upfront with the network getting paid a-la-carte as consumers made purchases.
“That’s not how we value our content,” he said. “We like our broadcast partners. They treat us fairly and make us a lot of money.”