Viacom CEO: Entertainment channel bundle priced at low teens to $20 is ‘inevitable’

Bob Bakish
Viacom CEO Bob Bakish. (Viacom)

Viacom CEO Bob Bakish thinks it won’t be long before entertainment-focused bundles priced lower than many new skinny bundles will be a reality.

Speaking today at a Deutsche Bank investor event, Bakish said most of the new skinny bundles coming from DirecTV, YouTube and Hulu are all priced around $40 and heavy on broadcast and sports. He said what the U.S. needs is a compelling lower-priced option, an entertainment pack which he predicted would focus on programmers like Viacom and be priced from the low teens to $20.

“We can’t say exactly when it will happen, but we feel it’s inevitable,” Bakish said, adding that Viacom is currently in conversations with lots of companies about such an offering.

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For example, Bakish pointed toward Europe, where operators like Sky sell packs focused on sports and entertainment, and noted that Sky’s entertainment pack is at 100% penetration.

He said that in the U.S., pay-TV penetration sits around 84%, and OTT will be a catalyst for price decline and market segmentation.

Of course, the type of skinny bundle he’s describing would be almost the complete opposite of YouTube TV, YouTube's recently announced live TV streaming service that focuses heavily on broadcast content and sports and is priced at $35 per month.

RELATED: TBS, TNT, MTV, others left out of YouTube’s new live TV service

In fact, YouTube TV is almost completely devoid of many of the core general and fairly niche entertainment channels that might be featured in the bundle Bakish described. Core networks from Viacom, Time Warner Inc., Discovery, Scripps, AMC and others were not included in YouTube TV at launch.

Bakish’s view of an inevitable nonsports bundle falls in line with BTIG analyst Rich Greenfield’s predictions that a so-called losers bundle will emerge, built from networks and channels considered noncore to a sports-focused skinny bundle.

“While the broadcast/cable network groups that own sports channels consider themselves the ‘core bundle’ (all expected to be part of the Hulu vMVPD), we believe there is real potential for an anti-Hulu bundle that combines all of the non-sports network groups that are generally viewed as ‘losers’ by investors,” wrote Greenfield in a blog post. “The non-sports cable network groups benefit from a far more compelling price/value opportunity and the lack of need to deal with the cost and distribution challenges of retransmission consent (retrans has led to spotty availability of broadcast TV on vMVPDs to-date).”

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