AMC Networks reportedly planning SVOD service for TV subscribers

The Walking Dead
AMC Networks may soon see how willing consumers are to pay for twice for TV. Image: AMC

AMC Networks is reportedly planning an SVOD service that requires both a monthly subscription fee and a pay-TV subscription.

According to Reuters, which cited unnamed sources, the ad-free service would only be available to customers with pay-TV accounts and it could also charge between $4.99 and $6.99 per month. That would set it apart from standalone services like HBO Now and CBS All Access, which only require a monthly fee, as well as traditional TV Everywhere apps that only require pay-TV account authentication.

The service, which could include digital-only spinoffs of current series like “The Walking Dead,” is reportedly an olive branch of sorts to the pay-TV industry, and a way to show allegiance with operators in a time when many video subscribers are cutting the cord.

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RELATED: AMC Networks' Q4 profits plummet as international losses widen

While it’s unclear how receptive consumers will be to essentially paying twice for AMC content, the network does still have a hugely popular series in “The Walking Dead” and exclusive content related to that series likely has drawing power.

AMC Networks CEO Josh Sapan has admitted that his company may seem over-reliant on “The Walking Dead,” but he sees the series as a cash cow for years to come.

“‘The Walking Dead’ is a franchise that will deliver ancillary revenues over different distribution platforms for many years to come, as it does today. And we believe it will have a long life that accrues to our strategic position and financial benefit,” Sapan said during a fourth-quarter earnings call.

Spinning off additional content for the “The Walking Dead” and other popular shows on the network and making them exclusively available on an SVOD would certainly count as ancillary revenue. And that could help AMC shore up some of its financial woes.

AMC Networks’ fourth-quarter net income fell to $14 million, compared with $90 million in the year-ago quarter.

While the programmer’s net revenues rose 7.5% to $730 million, thanks to 9.2% growth at national networks offsetting a $1 million decrease at international and other, operating income fell 35.3% to $104 million. The operating income slide was due in part to AMC’s international segment—which houses AMC Networks International and IFC Films—posting an $88 million operating loss as well as a $68 million impairment charge.

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