Paramount Global has a fairly unique position in the streaming market with distinct paid and free streaming services, and it likes it that way.
The company (formerly known as ViacomCBS) operates its streaming strategy with Paramount+, a subscription streaming platform with a cheaper ad-supported option, and Pluto TV, a free ad-supported service, at the forefront. CFO Naveen Chopra, speaking today at the Deutsche Bank Media, Internet and Telecom Conference, said keeping the two separate provides multiple benefits for both consumers and partners.
Chopra said that Paramount+ and Pluto TV gives Paramount Global a total addressable market (TAM) that’s at least twice as large as what’s commonly available to its peers in the traditional media world.
“If you want to have both ad-supported and subscription, we think it is important to keep those things separate. It’s very confusing for customers to have all that in one service and not really understand, ‘Is this free? Is this pay? What content do I get and where?’ We have the ability with Pluto to really shout from the rooftops that Pluto is free. And then we have the ability to position Paramount+ as the destination for high-quality content,” he said.
Chopra also outlined some commercial benefits from keeping Paramount+ and Pluto TV separated.
“Each of our distribution partners has their own strategic objectives and in some cases we can accomplish more by bundling a free ad-supported service, in some cases we can do more with subscription, and in some cases it’s the full portfolio. We like having all those arrows in our quiver,” he said.
Chopra said Paramount+ also uses the services for cross-platform promotions and for extending content leverage through windowing across the different services.
Paramount added 9.4 million new global streaming subscribers during the fourth quarter to reach more than 56 million by the end of 2021. Paramount+ accounted for 7.3 million of those new subscriber additions and brought its total up to 32.8 million. At the same time, Pluto TV added 10 million global monthly active users (MAUs) to reach more than 64 million.
While Paramount+ and Pluto TV continue to operate separately, Showtime OTT is getting closer to Paramount+. The premium channel's direct-to-consumer service is still available outside of Paramount+ but, beginning this summer, Paramount+ subscribers will be able to subscribe to and access Showtime within the Paramount+ app.