ViacomCBS assembles a House of Brands
Newly re-merged company details its new streaming strategy
Summary
· New streaming strategy features three services
· These products will serve free, broad pay and premium consumer segments
· Broad pay segment will introduce a ‘House of Brands’ to the CBS All Access service
· This ‘House of Brands’ strategy exploits the strength of the company’s individual content brands
· The differentiated strategy could sidestep discoverability issues facing existing generalist services
ViacomCBS streaming strategy relies on its collection of brands
In the recent earnings call, president and CEO of ViacomCBS Bob Bakish outlined the company’s strategy: “Our going forward approach to streaming is rooted in the belief that the streaming world will evolve similarly to the linear world. That means it will have free, broad pay and premium pay segments and, just like the linear world, we will have streaming products for each.”
The company outlined that its AVoD service Pluto TV will fulfil the free requirement, while Showtime OTT will be its premium offering.
Its broad pay option will use CBS All Access. It is here that ViacomCBS’s ‘House of Brands’, i.e. content and branding taken from across the breadth of Viacom properties, will be deployed, alongside existing content from CBS’s linear channels.
Branding is ViacomCBS’s weakness
In contrast, the world’s largest SVoD services have so far been generalist propositions, offering a little of everything. However, the market is now crowded with generalist services, which will be further exacerbated by the upcoming launches of HBO Max and Peacock.
Disney was able to draw upon a single well-known name to front its streaming future, cherry picking content from throughout its media empire.
WarnerMedia identified HBO as the strongest household name in its portfolio and co-opted it for its upcoming HBO Max service. Despite having a similar breadth of content, ViacomCBS has been denied this option, lacking a single brand with the power of HBO.
The merger of Viacom and CBS has left the combined entity with a multitude of channels which do not overlap, and therefore will resist consolidation.
Viacom itself is not a particularly meaningful household brand. Instead it is an umbrella for a collection of brands, in the same way that the name of the company that operates Google and YouTube, Alphabet, is less familiar to consumers than its subsidiaries.
While CBS certainly has an illustrious history in US television, the CBS brand does not hold the same weight in international territories as it does in the US.
ViacomCBS is facing an issue common to many channel groups outside of the big studios: its content is better associated with individual channel brands, than with the parent company.
Introducing the ‘House of Brands’
What ViacomCBS does have is a great strength in individual brands. Rather than launching a single combined VoD library, such as Netflix, ViacomCBS can instead ape the channel landscape of the past by using channel brands to identify content.
Names such as MTV, Nickelodeon and Comedy Central have a global reputation and a more obvious offering. Importantly, there is a greater association between these individual brands, and the content they produce, than between the brands and its parent.
This brand strength is not dissimilar to that represented in the labels used on Disney+ but ViacomCBS lacks a strong brand name to unite them all. Its self-named ‘House of Brands’ strategy will use the combined strength of individual brands to create a draw to a service, as well as clearly identifying to consumers the content they will find.
Traditional Tentpole Titles
CBS All Access also currently commissions a small number of hours of original content, used to draw subscribers to the service. Broadcast Intelligence’s Programme Index data indicates that 75% of all original commissions for CBS All Access are for scripted drama shows, a genre which can command high budgets.
Star Trek: Discovery had a reported per episode budget of USD $8–8.5m while the recently commissioned second series of Star Trek: Picard has received USD $20.45m in California tax incentives, one of the highest figures any television show has received from the fund run by the California Film Commission.
CBS had previously revealed details of its streaming content strategy. In 2019, CBS interactive president and CEO Marc DeBevoise said that CBS All Access is “going to have at least a show a month next year and at least one major tentpole in each quarter”, suggesting that the high cost Star Trek shows will continue to be used to draw in new subscribers to the service. However, keeping this popular and expensive content on the mid-tier service, and not the premium Showtime OTT, could perhaps be seen as a revenue opportunity too good to turn down in the future.
Conclusion
The company’s decision to use channel brands front and centre in its strategy keeps its options open. ViacomCBS can still choose to consolidate brands to a larger or lesser extent, depending on responses from the public. The use of a multitude of brands is a low-risk flexible approach to streaming.
However, while it may be agile and serves to preserve its valuable channel names, the company also risks becoming a jack of all trades, making it difficult for consumers to easily understand what CBS All Access means as a whole.
It is now generally accepted that vast SVoD libraries have a problem with discoverability, and that personalisation systems are not working. Many in the wider industry will be paying close attention to how this particular gambit plays out, as this is the first time that channel brands will be deployed wholesale to a paid-for VoD proposition outside of à la carte options.
Success or failure, ViacomCBS’s streaming strategy will not only be important for the company’s future but will also be looked upon by many as a test-case for a potential path of evolution for VoD in general.
This article was originally published on 5th March 2020 by Broadcast Intelligence, part of Media Business Insight. This article remains the intellectual property of Media Business Insight and has been re-published here with their permission.
