Paramount + will have two subscription tiers: a basic tier costing $ 5 per month and a tier above $ 10 per month.
The $ 10 plan will be ad-free and will feature programming not available on the basic ad-supported level. The ingredients of the high-end plan include the live CBS signal, which has been a key part of CBS All Access, the predecessor of Paramount +.
Tom Ryan, President and CEO of ViacomCBS Streaming, today announced pricing and details of the plan during the company’s online presentation to online investors today, saying it will go into effect in June. “To quote a line from a CBS classic, the price is right,” Ryan said.
The baseline, he said, will include “the full spectrum of the Paramount + experience” at “incredible value”. Subscribers will receive live sports like NFL football and UAIFA; news from CBSN and segments of CBS News on demand; Paramount + originals; Paramount Movies; and “much” of library titles and current seasons of CBS shows.
Paramount + Programming: TV shows and movies that will air on the ViacomCBS service
In addition to a lack of commercials, the premium tier will offer live sports supplemented by “even more CBS Sports,” Ryan said, without giving further details. The news will be “enriched” by news feeds, he said, including local news from stations across the country. Continuing the metaphor of the day, he promised that “the mountain of premium subscriber entertainment will become even greater, with the full CBS live TV experience right at your fingertips.”
Ryan also said that bundles will also be put in place for Paramount + and other unspecified streaming offerings under the ViacomCBS tent, with the aim of creating an “integrated ecosystem of services”. In a question-and-answer session with analysts, Ryan said the company has opted for the two-tier structure so it can reach “the largest addressable audience”.
The pricing places the ViacomCBS in the low to mid range among the series of new streaming services. NBCUniversal’s Peacock has a free, ad-supported base tier and a $ 5 premium tier. At the high end is HBO Max at $ 15 per month. Apple and Disney have marked the middle ground in subscription streaming. Netflix, the longtime streaming leader, costs $ 14 for its most popular US plan.
The new structure follows the broad lines of CBS All Access, which was a first direct-to-consumer offering when it launched in 2015. The base level for CBS All Access was $ 6 per month. Breaking with the previous ones, there is a differentiated content offering, adding other choices beyond just having ads or not. Ryan said he will also offer the company ways to “sell” Paramount + viewers who may wish to add Showtime’s OTT service.
A channel on the company’s free and ad-supported service, Pluto, markets showtime and is an effective customer acquisition tool, Ryan added during question period. He said more information on the bundling would be shared soon.
Several analysts appeared to be out of sync with pricing, with some noting Netflix’s continued growth despite several price jumps. Disney has also increased the prices of Disney + and Hulu has increased its premium ticket. A typical question was asked by Vijay Jayant to Evercore ISI. “I’m just trying to understand the economics of this business,” he said. He estimated the company’s current revenue per subscriber, including advertising and affiliate costs, to be between $ 17 and $ 18 per traditional subscriber. “When you talk about the pricing of these products you obviously don’t know what the advertising component is, how is that going to be profitable for the business?”
CFO Naveen Chopra responded by saying that “the scale will present a tremendous opportunity” in streaming compared to traditional distribution. The company is also betting on its ability to replicate the traditional pay-TV “double-stream” approach with subscription and ad revenue filling the tills, he said.
CBS All Access will officially be rebranded as Paramount + next Thursday in the US and Latin America, with more global territories to follow. Ahead of the streaming showcase, ViacomCBS announced it had surpassed 30 million global subscribers for its entire streaming portfolio.