For Variety VIP+ subscribers: Will Paramount+ and Peacock’s pivots be worth the pain as their corporate parents jockey for position in the streaming space?
While hardly the biggest spenders in the streaming game — Disney’s DTC expenses soared to nearly $25 billion for the calendar year, with its losses totaling over $4 billion — Paramount and NBCU sit in a much thornier spot. It remains doubtful whether Paramount+ and Peacock can achieve the scale needed to prevail in the streaming wars, and as Wall Streetto deliver profits, it’s worth wondering if the struggle will ultimately be worth it.
As it stands, Paramount and NBCU are increasingly looking to improve their balance sheets by any and all means necessary. Paramount isits onetime premium cable flagship Showtime into little more than a content pipeline and promotional tool for Paramount+, rebranding both its premium streaming tier and the linear network as the ungainly “Paramount+ with Showtime.” The move is expected to reduce annual expenses by about $700 million, CFO Naveen Chopra explained on Thursday’s Q4 earnings call.
There’s reason to be skeptical. Peacock is touting its Q4 sub growth as a sign of serious momentum, but the streamer simply can’t expect that level of sign-ups every quarter. Soccer’s World Cup and the NFL season were major attractions in Q4 that can’t be replicated, even if “Poker Face” and other original series prove to be major hits.for SVODs, per analytics firm Antenna, standing behind only Apple TV+ and Lionsgate’s Starz in most months.
The upshot of all this is that Paramount and NBCU are playing the streaming game with more and more desperation, when the current market begs the question of whether they should be in the game at all. Contraction is going to be inevitable as the streaming industry continues to mature, as are that the market is currently oversaturated; if their margins don’t improve, Paramount and NBCU are going to face tough questions about their viability in that market.
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