Feb 25, 2020 - Economy & Business

Investors are wary of ViacomCBS' new streaming strategy

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Data: Yahoo Finance; Chart: Andrew Witherspoon/Axios

Shares of the newly-combined ViacomCBS dropped a startling 15% last week, after the company announced plans for a new streaming service during its first earnings report as a combined entity.

Why it matters: The company is now worth far less combined ($17 billion in market capitalization) than the two companies were worth separately (around $30 billion) prior to their merger.

Details: Analysts have had mixed reactions to the company's streaming plans, which includes expanding CBS All Access to include exclusive content from Viacom's cable networks, like MTV and Nickelodeon, as well as Viacom's film studio Paramount.

  • Some argue the company's streaming service strategy isn't clear, and that it's confusing as to how the company will balance selling its assets to consumers directly while also keeping its traditional TV business afloat.
  • Others suggest that building off the already successful CBS All Access tech stack and model gives the company a strong start.

By the numbers:

  • 22 million ad-supported streaming monthly active users
  • 11 million subscription-streaming subscribers (Showtime and CBS All Access)
  • $1.6 billion in streaming & digital video revenue

Be smart: The company clearly sees a combined streaming service as a huge pillar of its corporate strategy moving forward. Not only did the company release its streaming revenues for the first time, but it bought sponsored social media posts to promote the numbers shortly after.

Go deeper: George Cheeks to replace CBS chief Joe Ianniello at ViacomCBS

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Free, ad-supported streaming on the rise as major media companies buy up platforms

Data: PwC and Digital TV Research; Chart: Axios VisualsA few of the last remaining major ad-supported streaming platforms are reportedly nearing sales to major media companies.

A few of the last remaining major ad-supported streaming platforms are reportedly nearing sales to major media companies.

Why it matters: The acquisitions show how valuable big media companies think ad-supported streaming services could be to their overall streaming strategies, as they continue to also invest in subscription streaming offerings.

PGA strikes $680 million TV rights deal with NBC, CBS, ESPN

Illustration: Sarah Grillo/Axios

The PGA Tour has struck a 9-year rights deal with CBS Sports, NBC Sports and ESPN for around $680 million, Variety reports.

Why it matters: The value of distributing professional golf in the U.S. is increasing as more TV networks clamor to hold live sports rights. In the streaming era, live sports are keeping traditional TV alive.

Go deeperArrowMar 10, 2020 - Sports

ViacomCBS exploring sale of Simon & Schuster

Photo: Sam Mellish/In Pictures via Getty Images

ViacomCBS is looking to sell Simon & Schuster, the nearly 100-year-old publishing business, ViacomCBS CEO Bob Bakish said Wednesday.

Why it matters: The possible move comes as part of the company's plan to shed noncore assets to better focus on its core businesses: video and streaming.