Paramount Global desires to attain its personal worldwide hit à la Netflix’s Squid Game, as the corporate prepares to develop its flagship streaming service to the UK, South Korea, Germany and different territories within the coming months.
“I always wanted to get international productions aired in places like the US and it never worked, because it was hard to put them on linear networks and to streaming,” Paramount’s chief government Bob Bakish informed the Financial Times. “Netflix demonstrated this . . . you could bring people global product”.
Paramount Plus, which provides hits such because the TV reveals SpongeBob SquarePants and Yellowjackets and the Top Gun movies, is launching within the UK on Wednesday for £7 a month. Paramount declined to say what number of subscribers it expects to achieve within the UK.
The enlargement comes because the embattled Paramount group, previously named ViacomCBS, appears to persuade buyers that it may possibly succeed with out merging with a bigger rival within the midst of a pricey, high-stakes battle for streaming prospects.
In the marketplace for on-line tv and movie, Paramount, with a market capitalisation of $15bn, competes with behemoths corresponding to Apple, Amazon and Disney.
“I hear the narrative, but we definitely have what it takes to compete,” mentioned Bakish, pointing to the corporate’s sprawling worldwide portfolio of tv networks, and longstanding partnerships with native incumbents corresponding to Sky within the UK, Reliance in India and CJ ENM in Korea.
The inventory costs of Paramount and its rivals in leisure have dropped in current months as a current slowdown at Netflix has spooked buyers in regards to the viability of the streaming mannequin.
Naveen Chopra, Paramount’s chief monetary officer, dismisses this concern, pointing to the truth that the corporate was by no means given the monetary leeway that Wall Street had afforded Netflix and Disney. “They had the luxury, quite frankly for several years, of getting to play with free money. And for better or worse, we never had that luxury,” he mentioned.
“We had to build a streaming strategy from day one that was focused on . . . the right balance of investment and growth, and how you do it in a way that you can generate reasonable returns”.
Some analysts have additionally questioned whether or not streaming can ever be as worthwhile as conventional TV, however Bakish insists that it’s well worth the funding.
“We think streaming is a great opportunity,” he mentioned. “We’re in investment mode and will increase our content investment in 2023, but beyond that we see momentum building and ultimately see streaming having very TV-like margins.”
Amid broader financial issues and hovering inflation, the old-media companies that Paramount has caught to — corresponding to promoting and the cinema — are again in vogue.
While Netflix is simply now trying to get into promoting, Paramount has expertise by its Pluto streaming service and legacy tv channels. Paramount additionally has a century-old film studio that brings in income from the field workplace. “People are sort of waking up and saying, oh, actually the things that Paramount’s doing probably do make a lot of sense,” Chopra mentioned.
Paramount executives have had causes to really feel optimistic these days. Top Gun: Maverick, which was delayed for greater than two years as a result of pandemic, has raked in additional than $800mn on the field workplace, making it the second-highest-grossing movie within the studio’s historical past.
As Netflix has stumbled this yr, Paramount’s streaming providers have been rising shortly — albeit from a smaller base. In the primary quarter its two huge streamers, Paramount Plus and Showtime, reached a mixed 62mn subscribers, up 73 per cent from a yr earlier.
The firm expects to achieve 75mn subscribers by the top of the yr.
And, following a cold reception from Wall Street to its go-it-alone technique, Paramount gained a coveted investor in Warren Buffett’s Berkshire Hathaway, which bought about 69mn shares within the first quarter. The Berkshire disclosure gave the inventory a lift in May, however the shares have fallen together with the broader market sell-off and are down 23 per cent this yr.
Despite its current successes, analysts stay unconvinced by Paramount’s technique. The firm, which is managed by the billionaire Redstone household, is perpetually rumoured to be up on the market, after a wider consolidation in leisure that introduced collectively Disney and Fox, in addition to Warner and Discovery.
Paramount’s board earlier this yr met bankers about potential deal choices, in line with a New York Times report. The assembly was a part of a presentation on the state of the trade, and bankers proposed concepts in that context, mentioned an individual near the scenario.
When requested by the FT, Bakish disregarded the notion of shopping for or promoting any property.
In addition to the film studio, Paramount owns cable channels corresponding to Nickelodeon and MTV, the CBS broadcast channel, and different free-to-air tv channels around the globe. “Our asset portfolio is very strong. we’ve got billions of dollars of cash on our books,” mentioned Bakish. “So we like our position”.