The merger – or reunification – of CBS and Viacom makes perfect sense on paper. The deal brings brands such as Nickelodeon, Paramount TV, MTV, Comedy Central, CBS Network, and Showtime all under one roof, boasting a combined portfolio of over 140,000 TV episodes and 3,600 movies, according to ABC News. It will also allow the combined business to invest in more new content.
Yet ViacomCBS will still remain relatively small compared to the likes of Disney and Netflix, as all the media corporations continue to jostle for position in the battle for eyeballs.
Personally, I’m not hugely confident about the merger, and – like many others, I’m sure – I’ve also become slightly confused by all the ‘relationships’ in the recent media mergers.
Nickelodeon and Nick Jr. are better than anyone else at creating blockbusters from linear TV shows. This gives them access to CBS’s own younger skewing brands, which can be exploited. Viacom sees Nickelodeon and Nick Jr. as a platform to launch and mature high-quality kids’ content. And I don’t see why this would change. Linear viewing figures may continue to decline, but they are still huge. And our own study shows that Netflix will slowly catch up – as will other streaming platforms.
Perhaps the most interesting and commented on element of the merger is the impact on the Star Trek IP. This is a brand that has a huge adult fan audience and enough story for ViacomCBS to build a very strong kid-focussed show. The merger with Nickelodeon means that, at some stage in the future, it may find a brave new home for kids, family and adult fans.
Content needs an audience to survive. In theory this creates a far larger catalogue and broader demographic appeal for CBC All Access. Which should make it a more compelling subscription offer for families who want deep, broad and quality content in one place. The challenge will be – is it more compelling to what the likes of Netflix and Disney will offer?
In terms of kids’ content, it will be interesting how to see how they leverage kids content on CBS All Access, Viacom’s kid focussed linear channels, and the ad-supported Pluto TV which has over 18 million MAUs (monthly active users) already.
The content CBS All Access is dealing with has really strong multi-generational appeal, featuring Danger Mouse and Inspector Gadget, amongst others. Add this to the Viacom kids’ content from the ‘90s (and there is a really strong emergence of brands that, if executed well, will hit both parents and their kids. At the moment, I don’t see how it all fits together across the multiple platforms, business models and trenches of kids’ content, but if they collect data on which brands across each platform create meaningful audience relationships, they may continue to grow niche and mainstream amongst broader audiences.
So, ultimately, what will the merger mean for the kids’ entertainment space in general?
Viacom and CBS needed more clout in the battle for eyeballs. Whether this is the right relationship or not, they would have found it harder in the new universe of kids’ content when facing all the other mergers. This should make them more competitive by increasing their audience reach across demographics in both ‘channels’ and brands.
But without dodging the question, who knows? The rate of consolidation via mergers and meaningful partnerships makes it challenging to predict what the kids’ entertainment space will look like once all these relationships have operationally matured. Kids’ content being bundled into wider demographic universes is the blockbuster strategy. So finding a place and marrying a brand where IPs can exploit adult fans, parent buyers and children’s desire to super-consume a brand across platforms is interesting. By providing multiple spaces from cinema, retail, ad-funded networks such as Pluto TV and kids curated spaces like CBS All Access or Noggin, it seems sensible to provide a viewing occasion for each type of family and need.
We’ll be watching this space closely…