Paramount Global (NASDAQ:PARA) is considering working with other media rivals to offer customers bundles for streaming services, chief executive officer Bob Bakish said, having experienced similar benefits from offering its streaming service at a discount when purchased with Showtime.
Bakish noted the enduring value of bundling as a method for enhancing customer value and confirmed its integration into the company's streaming strategy, having previously used a similar strategy grouping together paid-TV operators for cable customers.
“We’ve been believers in bundling for a long time,” Bakish said on the company’s second-quarter earnings call. “Bundling has been one of the tried-and-true methods of value creation in media and certainly as we enter the streaming space, bundling is part of our strategy.”
Paramount Global's recent quarterly report revealed reduced streaming losses and a modest increase in Paramount+ subscribers, reaching 61 million.
Combining with Showtime just before the end of the quarter, Paramount + was able to yield higher prices and push revenues 47% higher year-on-year.
Given Paramount's scale compared to industry giants and its media rivals, speculation about a potential merger or acquisition for the US group has persisted, despite the chaos of its merger with ViacomCBS only ending in December 2019.
A strategic partnership could provide Paramount with an easier alternative to a full-on merger, avoiding regulatory hurdles and the issue of pleasing the Redstone family, which controls around 80% of the company’s shares.
Underscoring this benefit, Bakish noted the strategy's potential to “access consumer connections” and noted it “has certain attractive margin characteristics”, adding that the blending of Paramount+ with Showtime resulted in US$700 million in cost savings.
Paramount Global (NASDAQ:PARA) shares are up just over 3% in pre-market trading, having closed on Monday at just over $US15.50,