Viacom’s deal for Pluto TV offers a big advertising revenue opportunity for the company. To expand Pluto’s reach and drive up inventory value, Viacom is eyeing distributor partnerships.
Speaking today at a Morgan Stanley investor conference, Viacom CEO Bob Bakish said distributors with large broadband-only subscriber bases face constraints in terms of providing added-value video services without having to take on more fixed costs.
Bakish said that Viacom has been in conversations with distributors that offer both home and mobile broadband about providing access to Pluto TV on a no-cost basis so they can offer the product to broadband-only subscribers. He said Viacom will also offer upside in the form of revenue sharing or access to advertising inventory.
“It’s a tremendously compelling value proposition. It’s an extension of our partnership approach with distributors where we can now provide value across the whole subscriber base,” said Bakish. “I’ve had conversations with every distributor in the U.S. They all get it and they’re all excited about it. We’ll see some activity shortly in that regard.”
Bakish said Viacom will focus its Pluto TV distributor partnership efforts in the U.S. at first, and then it will shift attention to Latin America and eventually more international markets.
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Aside from any imminent distributor partnerships for Pluto TV, Viacom has a couple of high-profile smart TV integrations already in place for Pluto.
Pluto TV is already integrated with smart TVs from Samsung and Vizio, which Viacom said represent about 60% of the market. The company expects Pluto TV to be enabled on more than 30 million additional devices in the coming months.
Right now, Pluto TV is only selling about 50% of its inventory. Viacom said that’s partially due to the company having a nascent ad sales team.
Viacom CFO Wade Davis said that inventories comparable to Pluto TV’s are monetizing at $3 to $5 per user per month. Pluto TV currently counts more than 12 million monthly active users, and 7.5 million of them are on connected TVs where higher value ad inventory can be sold. He said that Viacom’s Advanced Marketing Solutions and the company’s client relationships should help Pluto TV quickly scale its monetization levels.