Requested whether or not Disney’s transfer away from “undifferentiated” common leisure programming has any impression on Paramount International, CEO Bob Bakish stated the platform already stands out within the area due to its choices, which embody Paramount movies, CBS programming, Nickelodeon exhibits and franchises.
“Differentiation issues and the overall leisure house could not make sense for everybody. However common leisure clearly is sensible for us,” Bakish instructed LightShed Companions analyst Wealthy Greenfield on the corporate earnings name Thursday.
The query got here after Disney CEO Bob Iger stated his firm was going to be “pretty aggressive at higher curation in terms of common leisure” on the corporate’s Feb. 8 earnings name, as Disney seems to be to hit $3 billion in future content material price financial savings.
“As a result of when you consider it, common leisure is usually undifferentiated versus our core franchises and our manufacturers, which, due to their differentiation and their high quality, have delivered larger returns for us over time,” Iger instructed traders.
These feedback additionally sparked questions on whether or not Disney would search to promote Hulu, an possibility that Iger implied Disney was contemplating, after saying on CNBC on Feb. 9 that “every little thing is on the desk.” Paramount International was additionally requested by Greenfield if it might think about shopping for Hulu through the name Thursday, however executives didn’t reply the query.
In response to the query on its common leisure emphasis, Bakish spoke to Paramount International’s document quarter consumer achieve, with the corporate reaching greater than 77 million subscribers on the finish of 2022, up from 67 million within the prior quarter. The subscriber progress was pushed by the NFL, hits corresponding to Yellowstone and High Gun: Maverick and 1923, CBS leisure and new franchises corresponding to Tulsa King and Smile, in accordance with Paramount.
Nevertheless with the expansion got here elevated spending, as Paramount noticed its fourth-quarter revenue swing to a loss from the prior quarter, whereas outlining 2023 as its peak funding yr for streaming, with a forecast of detrimental free money movement.
Earlier on the earnings name, Bakish stated Paramount could be seeking to “effectively handle” the corporate’s content material spending. A part of that may come from its integration with Showtime, which is predicted to deliver $700 million of future annual expense financial savings. Nevertheless, Bakish stated the corporate may also be specializing in franchises, which usher in larger engagement with decrease acquisition prices, whereas taking “selective swings” on new IP.
“Our multi-platform technique and franchise focus guarantee we are able to construct a differentiated content material slate and concurrently create a compelling content material ROI. So once more, common leisure, it completely works for us, on the whole with streaming, and perhaps we’re completely different due to our asset composition technique, however we’re leaning into it,” Bakish stated.