Now that all the big media companies have launched at least one streaming service into the overcrowded U.S. market, it’s time to look everywhere else for more customers. For latecomers, overseas growth is the biggest opportunity to grab more market share. And that’s where media executives such as Kelly Day come in.
Day, a long-time digital-media veteran, is president of international streaming services for ViacomCBS. She’s charged with the task of debuting ad-supported service Pluto and subscription service Paramount Plus into dozens of countries by the end of 2022.
And unlike Netflix, which in 2016 tripled its global reach by essentially hitting an “on” button in 130 countries simultaneously, Day and ViacomCBS face more of a ground-and-pound war, adding territories and countries piece by piece.
“The ultimate vision is we want to operate a leading global streaming service, in pretty much every country in the world,” Day said. “But it’s not quite as simple as flipping the switch and being in 188 countries.”
That said, the company is planning some big moves, most notably this week’s confirmation of a collaboration with Comcast-owned satcaster Sky. Together, the companies said Wednesday they would co-launch streaming service “SkyShowtime” in more than 20 European countries beginning next year. The companies had previously announced a Europe-wide deal designed to adjust licensing arrangements for some ViacomCBS content among other provisions.
The partnership will allow both companies to leverage their distribution and content in a way less likely to fuel growing antitrust concerns in the United States and Europe, while giving the resulting entity a chance to better compete against the Big Four: Amazon, Netflix, Disney, and the announced merger of WarnerMedia and Discovery.
In the meantime, ViacomCBS’ latest Paramount Plus rollout came last week, in Australia. The country is “not a huge market, but it’s not a small market either,” Day said. “It's a piece in the overall puzzle.”
Part of Australia’s appeal is its highly productive local film and TV industry, which includes ViacomCBS's own pay TV and broadcast operations there. The island nation’s aggressive response to COVID also meant local creatives could be leveraged even as the pandemic raged elsewhere.
“We've actually managed to scale up some local productions that we're really excited about,” said Day, spotlighting “raunchy comedy” Spreadsheet. “COVID has been challenging on production across the board, but we have several (originals ready), with more coming for 2022.”
That local programming is important. Audiences tend to prefer at least some programming with a local tie. Just watching more Hollywood shows with local dubs has limits to its appeal for overseas audiences. And increasingly, carrying local content is legally required in Europe and other territories.
As much as creating local shows matters, so too does figuring out what else is available in a territory from all parts of ViacomCBS's “mountain of entertainment.” CBS, Showtime, Paramount, and all the Viacom cable networks have been pumping out programming for decades, and much of it is tied up in one place or another.
“The first gating factor, the first consideration is to really look at is how much content do we have available in a given market,” Day said. “We've been operating a scaled content business. We own a number of successful studios. We’ve been running those businesses a long, long time. Previously a lot of that content had been licensed out to partners.”
For instance, when ViacomCBS began producing the Star Trek: Discovery series, it partnered with Netflix in exchange for giving the streamer international rights to the latest edition of the company’s most iconic franchise.
And you won’t find South Park, another of the company’s most successful franchises and one of TV's longest-running comedy series, on Paramount Plus. In the United States and several other countries, the show’s 24 seasons and pandemic-era specials are only available on HBO Max.
“Ultimately, we'd love to have all of our biggest franchises, as much or all of that content as possible, and have it on Paramount Plus,” Day said. “That's something to aspire to. Sometimes the path can be somewhat complicated. We'll see where things go with some of our key franchises.
This month’s announcement of a mammoth $900 million deal with creators Trey Parker and Matt Stone was designed to address part of that issue earlier than later. Parker and Stone will make 14 South Park features expressly for Paramount Plus, continue making the Comedy Central mothership for five more seasons, and also somehow create non-South Park programming.
Day also oversees Pluto’s international expansion, which is proceeding at its own cadence, and not always in the same countries at the same time. The service is very much its own thing, and finding lots of fans as the entire AVOD sector continues to boom.
“There is an audience that genuinely loves the value proposition: It’s free, widely distributed, doesn't require registration, you can turn it on and leave it on,” Day said of Pluto. “There is a real uniqueness, I’ll say even quirkiness, to the service that people really appreciate that is different from what the expectation is of a premium SVOD service that’s driven by big-budget premium content.”
Pluto and Paramount Plus overlap and cross-promote heavily where they share markets. Importantly, Pluto’s promotional power and channels dedicated to ViacomCBS programming have been helpful in growing interest in Paramount Plus before launches, Day said. Pluto is already running across Latin America, as well as several European countries, with 25 more to be added by the end of 2022.
Pluto is also making a dent on the business side, as brands increasingly shift ad dollars to connected TVs showing what feels a lot like traditional basic cable. ViacomCBS CEO Bob Bakish, who made his managerial reputation reshaping Viacom’s European operations, recently announced that Pluto is on track to generate more than $1 billion in ad revenue this year.
Figuring out the audience expectations, local programming requirements, legacy partners such as local MVPDs carrying Viacom networks, technical delivery needs for each distribution platform of the apps, and other issues makes for a complicated and lengthy set of hurdles to overcome, Day said. But the payoff for companies that can figure out the secret sauce of overseas distribution can be huge.
“The economics of running a streaming service very much drive wanting to build a scaled global business,” Day said. “That’s why we want to be in pretty much every market in the world.”
