During its first-quarter earnings call, CBS said that about one-third of its All Access subscribers are paying for the more expensive ad-free tier of the service.
During the previous quarter, CBS announced that All Access and Showtime each now have 2.5 million subscribers, or 5 million combined. That means that around 830,000 All Access subscribers are paying $9.99 per month, instead of $5.99 for All Access with limited ads.
In March, CBS said that about one-quarter of its All Access subscribers were on the ad-free tier.
Joe Ianniello, chief operating officer at CBS, said the fact that consumers are willing to pay more for a premium channel experience with CBS shows gives the company some added leverage when negotiating things like carriage and distribution.
“When the consumer is making the choice to pay $10 a month, that speaks volumes and that gives us a lot of strength when we go into those negotiations because we know that the consumer has knowingly elected to pay that. They’re not being subsidized by advertising, or subsidized in big bundle cable package; they chose to do that so that gives us a lot of confidence when we head into those revenue negotiations,” Ianniello said during today’s earnings call.
CBS CEO Les Moonves said today during the call that All Access and Showtime are almost two-thirds of the way toward the stated goal of 8 million combined subscribers by 2020. That would put the services only slightly ahead of the 5 million combined they were both at in February when CBS announced fourth-quarter earnings.
But in its earnings release, CBS said subscriber growth is accelerating when the company looks at the combined activity across all distribution platforms.
“Specifically, when you combine our CBS and Showtime subs across traditional MVPDs, virtual MVPDs (aka "skinny bundles"), and direct-to-consumer services, CBS Corporation's subscribers are not only growing, but the growth is also accelerating. And the average rate per sub is increasing strongly as well,” Moonves said in a statement.