Dan Cohen, president of global distribution for ViacomCBS, said the company is apt to do more deals like its PVOD/streaming one for the next SpongeBob SquarePants movie and a broad pact with NBCUniversal’s Peacock.
Speaking Thursday at an online conference hosted by the Digital Entertainment Group, Cohen said premium video on demand “is a really intriguing model. It’s obviously getting a lot of attention right now with theaters being closed. I think I have rented every movie Universal has put out in PVOD, plus a few independent films. There’s something to it.”
The usual price of $20 for new releases, he added, “may be a little high for some consumers, so we’ll have to see how it plays out.”
One key variable, he said, will be developing a more widely shared set of performance metrics around PVOD titles that can serve as a benchmark, as box office numbers have for decades. Subscription streaming outlets and premium cable networks are “looking at PVOD as a potential replacement for theatrical” in their hunt for titles to license, but they need a way to set values for different films.
ViacomCBS is exploring its own ecosystem with SpongeBob SquarePants: Sponge on the Run, which will be released in PVOD and then segue to SVOD service CBS All Access. (Other studios have used similar in-company patterns during COVID-19.) Paramount also sold foreign rights to the film to Netflix, a move they have made in the past to cover risk on films.
Third-party buyers “have traditionally paid based on how a movie did at the box office,” Cohen noted. “PVOD is a different equation but it does generate transactions and it does generate revenue. Discussions are starting to happen where if a studio chooses to do PVOD instead of theatrical, or in addition to theatrical, that revenue could be counted on some basis. That will help drive adoption as well.”
The media landscape also points favors models like PVOD, he added. “When you have Comcast owning NBCU and owning Sky and AT&T owning Warner Bros. and DirecTV, there is some natural momentum toward figuring out how to get content into the home more quickly,” he said. “So I think you’ll see a lot more of this behavior going forward.”
Ad-supported video on demand [AVOD] is on a steep growth curve, Cohen said. In a 20-year run doing licensing deals at Disney, Cohen noted, “we didn’t do any AVOD deals” given the caliber of the content, spanning Star Wars, Marvel, Pixar and other areas. “We didn’t think the advertising revenue or views would be meaningful.”
After arriving at Paramount Pictures in 2017, Cohen said, the studio “was doing AVOD deals all over the place. And it wasn’t a lot of money, but when you have a deep library like Paramount has, I like to say there’s films for every use. We weren’t necessarily putting Top Gun and The Godfather in AVOD. Flash forward to 2020 and we will put films like Top Gun and The Godfather into AVOD because the business has exploded.”
One major AVOD purveyor is Pluto TV, which Viacom acquired in 2019. Another new entrant to the space is Peacock, with which ViacomCBS did a wide-ranging licensing deal just before its nationwide launch this week. The Godfather was among those titles, as were a number of CBS series as well as early seasons of South Park. While CBS All Access and Showtime together have nearly 20 million subscribers and bring in a good amount of revenue, the company’s longtime strategy has been to continue licensing to third parties.
“I had content that I needed to monetize and Peacock was getting ready to launch and put its best foot forward,” Cohen recalled. “Two series really started the conversation: The Affair and Ray Donovan. They remain part of the Showtime ecosystem but they’re also on Peacock. That’s a model we’re comfortable with. … You’ll see more of that going forward.”