Acting CBS CEO Joe Ianniello touched on topics like international streaming growth, NFL rights and relations with the company’s new board of directors in an appearance Wednesday at the Credit Suisse communications conference.
There was no mention during the 40-minute conversation of upcoming merger talks between CBS and Viacom. The closest Ianniello came to addressing it was in asserting that while CBS execs “like our asset mix … we should be looking at all opportunities.” Any M&A scenario, however, would have to clear a series of hurdles, he added.
Streaming, he said, is “by far the biggest opportunity” for the company. Last month, CBS issued updated estimates for 25 million total streaming subscribers by 2022 for Showtime and CBS All Access combined.
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Ianniello repeatedly invoked the company’s early bet on direct-to-consumer offerings, a sector that rivals like Disney and WarnerMedia are only this year entering in a meaningful way. He also several times emphasized that the 25 million target was just for the U.S. “There’s a whole lot more people in the rest of the world,” he said. Prodded by moderator and Credit Suisse analyst Doug Mitchelson to provide a timetable for international rollouts, he declined. “I want to go fast but I also want to be prudent,” he said. “I don’t want to put deadlines on things that will be artificial.” Latin America and Western Europe would likely be the first regions for CBS to enter, Ianniello said, reaffirming previous comments.
The tech stack that powers the company’s streaming offerings was developed in-house, the CEO noted. “We didn’t spend billions of dollars,” he said. “That scales.”
The company’s direct-to-consumer momentum, which picked up speed once All Access and Showtime launched in 2015, has brought about a culture shift inside the 90-year-old company, Ianniello acknowledged. “When we drop a show — for example, we released The Twilight Zone on April 1. On April 2, I’m on the phone saying, ‘How many subscribers signed up?’” he said. In the traditional linear world, by comparison, the phone calls had been about overnight ratings.
“Their consumption pattern is different,” he added, alluding to streaming subscribers. “They’re younger and they watch much more. When they watch is different.”
The management team is “learning all those different things,” Ianniello said. “Gratification isn’t immediate. All those subscribers don’t come on one day.” The exec, who had been at the company two decades before taking the interim CEO reins last Septmber, said he had his own learning curve. “I would say, ‘Oh, we promoted it. Shouldn’t they subscribe on Day 1 so they have their seat?’”
NFL broadcasts will remain a priority for the company, Ianniello said. “We certainly anticipate retaining the NFL,” he said. “Their core audience is broadcast.” While the league “has had choice for decades,” he added, “You’ve never seen a Super Bowl on a cable network. .. They understand the broad reach. We’ll be partners for a long time.”
Asked by Mitchelson about how his first nine months in the top job have gone, Ianniello mentioned the new slate of board members. (More than half of the 11 directors joined the company in 2018. All of them were re-elected during last month’s annual shareholder meeting.)
“Anytime you have a new board, people are coming from different walks of life and different experiences,” Ianniello reasoned. “Management’s job is trying to make sure we’re all on the same page.”
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