While AT&T launched its much-ballyhooed virtual MVPD service conspicuously absent of a deal to secure CBS and Showtime, CBS Corp. chief executive Les Moonves thinks an agreement will happen soon.
“We’re in discussions with DirecTV Now, and I’m assuming we’ll be able to make a deal with them,” Moonves said Monday at an annual investor conference conducted by UBS. “There are some issues that are outstanding … there are some things we’re still fighting for.
“We’re not unreasonable people,” Moonves added, indicating that he was quoting from The Godfather.
RELATED: DirecTV Now set to launch without CBS, Bloomberg says
This morning, AT&T CEO Randall Stephens told investors that DirecTV Now is exceeding expectations for subscriber uptake just six days after launch. In fact, he said it matched AT&T’s forecast for all of December within just days of its Nov. 30 launch.
"This thing is doing very, very well," Stephenson said, without providing any subscriber numbers.
Stephenson added that he expects DirecTV Now margins to be thin at first until the platform’s scale gets to a point where AT&T can yield more revenue through targeted advertising.
Shifting from Godfather to golf references, Moonves provided investors with a more bearish assessment, telling investors that AT&T’s promotional $35-a-month launch pricing for the platform rendered profitability a “tough putt.”
He also dismissed DirecTV’s retrans deals for broadcast rivals ABC, FOX and NBC, noting that the agreements are limited to owned and operated stations and do not include access to network affiliates.
“That’s only 20 percent of the country,” Moonves said.
RELATED: HBO for $5 a month? AT&T’s DirecTV Now offerings ‘aren’t going to make any money’
Moonves also remarked on DirecTV’s incredibly low $5-a-month price point for HBO, which is owned by pending AT&T acquisition Time Warner Inc.
“I can tell you that they’re not going to get Showtime for $5 a sub,” Moonves said.