Saturday, August 11, 2018

Viacom Moving Ahead with OTT Plan and US$1bn Studio Production Goal

Viacom is moving ahead with plans to launch a new direct-to-consumer platform in the US as well as ramping up its studio production initiative globally to create new first-run content for third-party platforms, according to Viacom president and CEO Bob Bakish.


Speaking to analysts after the company posted its fiscal Q3 results, Bakish said that one element of the company’s “multi-dimensional approach to ensure that we’re making the most out of our assets and capabilities” in over-the-top (OTT) would be by “launching a new D2C platform, which we’ve referenced previously”.

Bakish had previously referred to this plan at the time of Viacom’s Q1 2018 results in February. He said at the time that the new service would launch by September, rolling Viacom brands into a combine service that would be distributed by mobile telecom operators.

Bakish also highlighted Viacom’s cross-portfolio studio production initiative, which he said was not about licensing library product wholesale to SVOD platforms but about “new first-run content for SVOD platforms and other third parties”. He said that Paramount TV’s growth had sown there was a growing appetite for premium episodic video content, but that there was now “a much larger opportunity” that will see Viacom build studio production into a US$1 billion business by 2020.


Viacom president and CEO Bob Bakish

He said Viacom had established studio production units at Nickelodeon, MTV and Viacom International Media Networks (VIMN), with units at Comedy Central and BET to launch shortly. These units will “create new original content for third party customers leveraging existing and new IP”.

Other initiatives will target the Latin American and Brazilian markets, as well as identifying intellectual property within it' vaults that could be an ideal fit for a digital or linear programmer outside of Viacom. One such property, Nickelodeon's Pinky Malinky, will debut on Netflix around the world on Friday 17th August 2018. Although bowing on Netflix, Pinky Malinky will feature Nickelodeon branding at the show open.

Bakish said that the strategy to ramp up production for third party subscription video-on-demand (SVoD) services was about “extending brand reach beyond pay TV” and about creating first-run content to extend brands tho other platforms and generate incremental revenues.

Bakish said that Viacom was continuing to create “targeted D2C products” that are also distribute through partners, such as Nickelodeon's Noggin, which launched on Amazon’s Prime Video Channels in May.

Viacom exceeded analyst expectations in profits growth for its third fiscal quarter, despite a decline in revenue of 4% to US$3.24 billion.

Operating income grew by 1% to US$752 million, boosted by a better than expected performance at Paramount Pictures.

The company’s media networks division saw revenues dip by 2% to US$2.5 billion, with a 17% increase in ancillary revenues being more than offset by ta 4% decline in advertising revenues and a 3% decline in affiliate revenues. Domestic and international revenues each declined by 2% to US$1.99 billion and US$509 million respectively, with international revenues flat at constant currency.

Paramount Pictures revenue was up by 58%. For filmed entertainment overall, a decline in international revenues of a third pushed the overall top lien down by 9% to US$772 million.

Bakish said that the company’s turnaround was “delivering demonstrable and measurable results” as Viacom pivoted to become “a truly multi-platform, global brand and IP-driven entertainment company”.

Original source: Digital TV Europe.

Also, from MediaPost:

Viacom Expands Efforts To Produce Shows For Streaming Services

Viacom is betting big on streaming video -- even if its own efforts in the space don’t pan out.

The company continues to invest in a new direct-to-consumer platform that it expects to unveil at a later date.

For now, however, Viacom is happy to cooperate with the likes of Netflix, Hulu and YouTube through a "studios” initiative.

In June, the company announced a new business unit called MTV Studios that would create TV shows specifically for third-party streaming services, or even other cable channels.

MTV Studios is using the network's intellectual property library to develop reboots or spinoffs of classic shows that no longer work for the main MTV channel, but still have some legs, such as a reboot of the animated series “Daria” as well as “The Real World.”

Apparently Viacom was so pleased with the idea that it is now expanding the concept across the company. Comedy Central and BET will launch their own “studios” soon as well, and will mine their IP library for concepts that could be sold to Netflix, Hulu or elsewhere.

Viacom hopes to turn these production studios into a $1 billion business by 2020.

“The studio initiative is really driven by a confluence of things: First, the large and growing demand from third parties for quality episodic content worldwide, and Viacom’s ownership of broad and deep libraries of IP," Viacom CEO Bob Bakish said on the company’s quarterly earnings call Thursday.

“The mandate for these entities is to create new original content for third-party customers, leveraging existing and new IP -- and it is already beginning to happen,” Bakish added, noting that Netflix had picked up 59 episodes of a program developed by Nickelodeon’s studios unit.

The company also believes that by licensing original shows to other platforms -- particularly platforms popular with younger consumers that may not currently pay for TV -- can serve to enhance the company’s brand, and retain relevance in a fragmented media environment.

“This initiative is about creating new first-run content. it’s not about the wholesale licensing of library product to third parties,” Bakish said. "These shows, in addition to being a business in their own right, can serve as promotion for our brands because by far the fullest experience of our brands will continue to be in the pay-TV space.”

--Ends--

More Nick: Nickelodeon Renews 'Rise of the Teenage Mutant Ninja Turtles', 'Henry Danger', 'Hunter Street', 'Knight Squad' and 'The Dude Perfect Show' for New Seasons!

Originally published: Friday, August 10, 2018.
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