Up until now in the streaming wars, live sports were something of a tantalizing appetizer. Mouthwatering and exciting, sure, but not the real reason you signed up. It was great that, say, Peacock, NBCUniversal’s streaming offering, was set to stream the Olympics last summer (they were postponed because of COVID-19), but fans were primarily interested in bingeing shows such as 30 Rock and The Office. And Netflix, of course, has been emphatic that it has no plans to stream live sports.
Even pure sports streaming apps such as ESPN Plus have largely been sold as “complementary” and “additive” services to their linear siblings. There are a couple of reasons for this: One, viewers—and advertising dollars—still flow to traditional broadcast and cable networks, particularly for spectacles such as the Super Bowl, major college football games, and the NBA playoffs. Two, the rights for the most attractive sports content are still tied up with legacy networks, and for the last several years, at least, there’s been some uncertainty that the economics of streaming premium sporting events makes sense.
Into this environment comes Paramount Plus, Viacom’s new entry into the streaming playoffs, which launches March 4 and costs $10 a month. (An ad-supported version is set to launch in June for $5 a month). Paramount Plus is seeking to flip the logic that’s put sports on the streaming sidelines. Rather than selling itself primarily as the home of Nickelodeon kids’ shows and big Hollywood movie franchises such as Mission: Impossible—it has those, too—when Viacom laid out its streaming plans last week, it led with a sports pitch.
“Paramount Plus will be the leader in live sports,” CBS Entertainment Group head George Cheeks said bluntly. “Bottom line, everything sports fans love on CBS . . . all of this will be available on Paramount Plus.”
That means live soccer: Paramount Plus is the exclusive home of UEFA soccer in the U.S., which includes the Champions League and Europa League, and it will air National Women’s Soccer League matches. There will also be exclusive, soccer-related programming, such as the original documentary Sir Alex Ferguson: Never Give In. Netflix has had significant success with soccer documentaries such as Sunderland ‘Til I Die, and Amazon Prime Video had a hit with All or Nothing: Manchester City.
It also means American football, which is Viacom’s most valuable sports property, though it’s up for renewal soon. Viacom is shifting the popular series Inside the NFL from Showtime to Paramount Plus, and NFL games will be available to stream, though they will also still air on CBS’s linear channels. But Paramount Plus could resolve any concerns cord-cutter football fans have about where to find at least some of the games they crave.
Cheeks said that the NFL attracts “massive audiences and major advertisers, and it will be fundamental to the growth of Paramount Plus. It drives more subscriptions than any other program and significant engagement, too.”
The NFL is indeed a huge attraction for potential Paramount Plus subscribers and will become all the more so as time goes on and the broadcast television business continues to erode. It’s already happening at a fairly steady rate: According to a February 4 report from the analyst group MoffettNatthanson, ESPN saw a 26% drop in total day viewership in the last quarter of 2020, perhaps owing to changes in the schedule due to the pandemic, but the report also hinted that the dip could be for more “sinister” reasons.
Meaning, growing fatigue with cable television.
But there’s a reason this crumbling isn’t happening faster with sports. Relying on games to sell streaming has a host of challenges, explaining why up until now most streamers have put most of their money and advertising behind exclusive, original programming such as The Mandalorian (Disney Plus) and The Crown (Netflix). First, there’s the money factor. In January, CBS generated a record $545 million in advertising revenue for the Bucs-versus-Chiefs Super Bowl, despite abysmal ratings. That’s a lot of dough.
Second, sports passions can be largely regional. Americans may flock to NFL games, but does anyone care in Europe or South America? Soccer, while growing in popularity here, works the other way around. For Paramount Plus to compete with the likes of Netflix and Disney Plus, it needs to expand well beyond the United States, and the reality is that sports don’t travel the way a splashy action series that’s a spinoff of a beloved franchise such as Star Wars does. Netflix currently has more than 200 million subscribers, 130 million of which are international. A third challenge is that sports viewing encourages churn from subscribers who tune in for their favorite sports season and then tune out when it’s over.
This explains why even leaders in the genre, such as ESPN Plus, are still struggling to gain significant traction. While Disney Plus—which offers Disney’s entire back catalog of classics, along with old and new titles from Pixar, Marvel, and Disney Animation—has skyrocketed to almost 95 million subscribers in a little over a year, ESPN Plus, which has an à la carte sampling of games and coverage, has 12.1 million.
But as the streaming wars wear on and more money is thrown behind new originals, to the point that it’s hard for viewers even to keep up with what Netflix show or movie is hitting the service every day, sports are a less-explored territory that has the potential to drive subscriptions thanks to its rabid and engaged fan base.
It’s not just Viacom that’s making moves. NBCUniversal recently announced that it’s shutting down its dedicated sports channel NBC Sports Network by the end of the year and moving some of the content there to Peacock. And just Wednesday came another report that Amazon was likely to carry some NFL games exclusively on Prime Video.
In other words, Paramount Plus’s strategy may not be so much a deviation in the streaming playbook as a sign of what’s to come.