While there was a surprising amount of old-fashioned good news in the fourth-quarter earnings report delivered by CBS — retrans revenue, licensing and distribution all way up — the focus of today’s conference call with Wall Street analysts was squarely on digital.
Chairman and CEO Leslie Moonves said that CBS and Showtime together have 5 million subscribers to their respective OTT services. That puts the company ahead of schedule in its progress toward a projection of reaching 8 million by 2020. Originals such as Jordan Peele’s forthcoming Twilight Zone reboot as well as Star Trek and Good Wife iterations can be sold internationally as well as drawing subscribers.
The company is also about to expand its OTT portfolio with two new launches, execs announced on the call: the ad-supported CBS Sports HQ and a celebrity offering branded for syndicated staple Entertainment Tonight.
Apple Renews 'Carpool Karaoke' For Second Season
As to whether the growth in direct-to-consumer offerings could come to threaten more traditional areas of the business, Moonves waved away any concern. “I do view it as complementary,” he said. “The things that are driving our OTT product right now are catch-up on our network shows and then obviously as we add more original content, that becomes a driver.” With cord-shaving and re-bundling, he added, “More and more people are going to be watching shows in different ways. And as we have always said, you can get your CBS via MVPDs or via a virtual MVPD, a skinny bundle, or via All Access, and each one of them pays us more, so we look at it as all working together.”
The success of CBSN, a news offering, which has contributed “tens of millions” to company profits, COO Joseph Ianniello said, offers a model for the CBS Sports HQ and Entertainment Tonight efforts. Neither service was described in any detail during the call.
Having a studio it can connect to an array of pipelines, from traditional networks like the CBS broadcast network or premium cable network Showtime, to the burgeoning number of OTTs offers more ways to make money. International launches — beginning with Canada in the summer — will start to add revenue in the second half of 2018.
In preparation for the growing number of in-house platforms, CBS Studios has increased its output to 64 shows on 12 different platforms, double the level of just five years ago.
Subscribe to Deadline Breaking News Alerts and keep your inbox happy.