Worlds Collide as Viacom CEO Talks Pluto TV Deal
Bob Bakish seems to describe two opposite directions for the troubled media giant.
Speaking at Morgan Stanley’s Technology, Media, and Telecom Conference, Viacom CEO Bob Bakish tried his best to answer the question that media industry followers have been asking for years now: What on earth is Viacom doing?
A Tale of Two Media Companies…
Viacom has had a rough few years, in stark contrast to the other half of Sumner Redstone’s media empire, CBS.
Bob Bakish rose to power with the firing of Philippe Dauman, part of an ongoing and seemingly unending boardroom drama as 95-year-old Sumner Redstone’s health deteriorates.
Merging the media twins back together was once mulled as a solution to Viacom’s malaise, and Bakish seemed destined for the door, with CBS’s Les Moonves as the obvious choice to lead the combined company, having overseen CBS’s perennial prosperity.
It’s worth noting that OTT has played a crucial role in CBS’s success.
Bakish’s fate proved to be a sticking point. However, another boardroom battle and sexual harassment allegations against Moonves put the final nail in that idea’s coffin, and Bob Bakish back in the catbird seat.
Bob Bakish’s Viacom
At the recent conference, Bakish defended the company’s curious decision to shun OTT in favor of traditional MVPD distribution.
But with the company’s $340 million purchase of Pluto TV, is Viacom now jumping into the OTT space in a big way?
That’s where things start to get confusing…
According to Bakish, Pluto TV will be getting access to Viacom content, but that its best content will remain reserved for traditional pay-TV subscribers.
Mixed Signals
$340 million seems like a big spend to merely dip a toe in the OTT waters, particularly when Bakish acknowledges that the company has suffered from sitting out:
Viacom “kind of took it on the chin for two years with respect to distribution revenue”
And even now that Viacom has become an OTT service provider, via Pluto TV, the company only seems interested in steering viewers back to cable and satellite.
Bakish describes the free Pluto TV as an entry-level service, designed to upsell premium products from Comedy Central, Nickelodeon, and others. Though how Viacom can manage to push consumers simultaneously towards paid OTT products and a traditional TV subscription remains a bit of a mystery.
Make no mistake about it, Viacom has a vast library of quality content that consumers want, and many would gladly pay for.
But with a strategy of making sure a $100+ cable bundle is the only way to access the cream of Viacom’s crop, Bakish is making a dangerous call. Consumers have said loud and clear that they’re not willing to pay that much for hundreds of TV channels, just to a few favorite shows.
It’s hard to see even a diehard fan of Viacom’s networks being pleased with that deal, as the rest of the world, consumers and the media industry alike, turn towards OTT content distribution.
