Cannes Lions: CBS CEO Leslie Moonves Outlines Streaming Ambitions
"We believe OTT is our future," the exec said.
Over-the-top is the future of television, CBS CEO Leslie Moonves said Thursday when he kicked off the first-ever Cannes Lions Entertainment section in France.
The network has launched streaming service CBS All Access and will launch what the exec called the “crown jewel” on the platform with its Star Trek reboot in January.
“One of the most important things we’ve done in the last few years is our over-the-top service,” said Moonves. “We believe OTT is our future.”
He decided to keep the property in-house, even though Netflix or Amazon would “have paid a fortune” for it. Millions of Trekkies will pay $5.99, he believes, and that will "get the ball rolling."
The cross-pollination of tech and television has emboldened advertisers, and they are coming back to TV after a lapse. “Upfront selling is happening as we speak and it’s going phenomenally well. We had a rough year a year ago at the upfront and that’s because people were confused about digital,” he said. “I think we’ve figured out the combination of television and digital is extremely effective.”
Speaking to a room of advertising execs, Moonves encouraged them to change their approach as well. “Advertising has had to change just as we have had to change,” he said. Digital “shouldn’t be the same spot that’s watched by 20 million people watching NCIS — make the spot fit the platform, not make the platform fit the spot.”
With powerhouse properties like The Big Bang Theory and NCIS reaching 20 million viewers a week, Moonves can sell a reach that digital simply doesn’t have. “It takes a lot of hits on YouTube to hit 20 million people watching and being engaged. We say to advertisers, 'Buy YouTube, but buy us first,'” he said.
Addressing the example of Pepsi and Fox’s Empire working on a storyline together, the exec said that while such direct models will grow they will not make the bulk of deals in the future. “CBS does deals directly with clients and have relationships with clients, but that doesn’t mean the agency shouldn’t have a seat at the table,” said Moonves.
He also said that while Silicon Valley has often looked down at Hollywood, the relationship has shifted in recent years as quality content has become more integral to business models.
“There was an attitude up there that, ‘Oh, content is fungible, we can put up anything and it will sell the same.’ They’ve come around to a different way of thinking and I think everybody has a different place in the ecosystem,” said Moonves, citing Amazon as an example.
The shift to “anytime, anywhere” has been a boon for CBS, which traditionally skewed older.
“Overnight ratings don’t matter anymore,” he said. “The great news about content being disseminated is getting rid of demographic numbers which we had been fighting against for years.”
The CW, while not profitable as a network, is making money for both CBS and Warner Bros. on the back end.
“Every time we have a piece of content now, be it CBS or CW or syndication, we have what is called these 'content monetization' meetings. If we sell it to Netflix, how much are we going to get and where is it going to hurt in other areas?” said Moonves.
Still, he said, content is king. “The thing you can’t do is do an algorithm for content,” said Moonves. “You’re not going to watch a piece of crap on any device.”