Moonves: CBS On Pace for 8 Million Combined Subs for 'All Access,' Showtime OTT15 Feb, 2017 By: Erik Gruenwedel
CBS continues to herald rollout of separate over-the-top video services, CBS All Access and Showtime OTT. Speaking Feb. 15 on the company's fourth-quarter (ended Dec. 31, 2016) fiscal call, CEO Les Moonves said each subscription streaming service is on pace to reach 4 million subscribers.
When that milestone will be reached wasn’t disclosed. CBS management last officially mentioned sub data in July 2016, revealing the services had 2 million combined subs.
Some analysts contend Showtime OTT currently has about 1.5 million subscribers.
Regardless, CBS said the OTT services are exceeding internal expectations. All Access, which launched in 2014, had its best quarter in Q4; its best month in January, and its best day for sign-ups on Feb. 12, driven by the network broadcast of the Grammys.
Moonves said adding NFL football games last December boosted subs as well.
“We look to benefit from a full 17-week season this fall,” he said.
The CEO lauded sub growth all the while the service has yet to stream an original program. That ends Feb. 19 with the debut of “The Good Fight,” the service’s first original scripted political/legal drama. In addition, production has begun on the mega original series “Star Trek: Discovery” — streaming later this year.
“We are more pleased today [with SVOD] than we were at our Investor Day [March 15, 2016],” said CFO Joe Ianniello. “That’s the way [people] want to consume content. A lot of this [OTT] growth is coming from broadband-only households. The economics are as good as hoped.”
At the same time, management said the traditional pay-TV ecosystem isn’t changing significantly for the worse. Instead, it contends diversifying forms of distribution are satisfying alternative appetites.
Moonves, in a plug for increased affiliate cooperation in OTT, said CBS is the only media company to incorporate its network affiliate business model in online TV.
“By doing this, affiliates can get paid for their local live linear field of CBS,” Moonves said. “As people shift from one way of watching to another, we will be there.”
Indeed, CBS struck a deal with Hulu for the latter’s upcoming live streaming TV service. Notably, the agreement does not include any stacking rights to previous episodes — rights CBS is limiting to All Access.
“This makes it more attractive to the people using All Access. [Hulu] was a very good deal for us economically,” Moonves said, adding the company had not yet struck a deal with DirecTV Now.
“We are still anticipating conversations, and hopefully, we come to a good resolution with them as well,” he said.