Bob Bakish on Paramount+ Growth: “Our Plan Is to Raise Prices Again”
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Paramount will raise the price for its cornerstone streaming plan within the next two years after hiking the cost of Paramount+ with Showtime when it launched earlier this summer, according to chief executive Bob Bakish.
“Our plan is to raise prices again — this isn’t our only price increase,” Bakish said Wednesday at the Goldman Sachs Communacopia + Technology Conference in San Francisco. “Whether we do that in ’25 or ’24, we’ll see.”
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Reflecting on the company revealing in May that the monthly price of its premium tier will go up from $9.99 to $11.99, Bakish detailed that the move did not lead to more subscriber churn or bring down subscriber growth. He added, “That proves that we have pricing power in the marketplace, given the content we’re bringing to bear on the platform,” noting that he believes “there’s a lot of room to run there.”
Asked about the path to profitability, Bakish reaffirmed earlier comments that investment in streaming will peak this year. “That is very much tracking to be the case,” he said, adding that 2024 “will be a year of significant streaming loss improvements.” In its second-quarter earnings disclosed Aug. 7, Paramount posted a streaming loss of $424 million compared to $511 million in Q1.
But streaming was not all that was on Bakish’s mind. Turning to pay TV, he said, “We continue to get deals done without going dark” in a nod to the ongoing carriage dispute between Charter Communications and Disney that’s left millions of Spectrum subscribers without access to Disney-owned networks.
“We have co-marketing agreements with every major distributor for streaming products,” he explained. “It gives them an incentive to transition and ride that migration in consumer behavior.”
Bakish called Paramount+ with Showtime the “definitive multiplatform product,” allowing consumers to access its offerings in a multitude of ways. He stressed, “We see it as natural evolution of the business to work with key distributor partners to offer channel in both [streaming and cable]. We’re indifferent to how subscribers get it. I bet you we grow our linear share versus competitors because of that.”
Bakish also touched on free cash flow amid the dual strikes from writers and actors and how it’s proved a “deleveraging element” to reduce debt, along with its sale of Simon & Schuster to a private investment firm for $1.6 billion. “We are very much projecting to come out the other side,” he said. “You’ll see that meaningfully occur as we transition to 2024 and beyond.”
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