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Paramount Global CEO Bob Bakish outlined the studio’s plans to make it through the Writers Guild of America Strike on the company’s earnings call Thursday, saying that Paramount had been preparing for this possibility with a lineup of new releases and by moving production offshore.
“Writers are an essential part of creating content that our audiences enjoy, really across platforms. And we hope we can come to a resolution that works for everyone fairly quickly. But it’s also fair to say there’s a pretty big gap today,” Bakish said in response to an analyst question. “So obviously, we’ve been planning for this. We do have many levers to pull and that’ll allow us to manage through this strike, even if it’s for an extended duration. In terms of those levers, we have a lot of so to speak content in the can. So, with the exception of things like late night, consumers really won’t notice anything for a while.”
“Add to that a broad range of reality and unscripted, where we’re definitely a leader, as well as sports and that’s not affected. And so what we can do more in those areas as necessary and and again, we have a leadership position overall. Plus we have offshore production, which we’ve been moving to leverage pre-strike,” he said, adding that Paramount also has “one of the largest libraries in media.”
As for the financial impact, Bakish said it depends on the duration of the strike. However, he expects it will likely be “slightly dilutive” to revenue, flat on operating income before depreciation and amortization and accretive to cash.
Bakish’s comments join the prior statements made by others, including Netflix CEO Ted Sarandos, who had said that Netflix could weather a writers strike better than others due to its large library of content. Warner Bros. Discovery CEO David Zaslav had made similar comments about his streamers’ library.
WGA members have been picketing this week outside Paramount’s headquarters in L.A, as well as outside numerous other studios including Amazon, Netflix and Warner Bros. Discovery.
The upcoming content slate for Paramount includes the release of four franchise films in the coming months, Bakish said, including Transformers: Rise of the Beasts in June, Tom Cruise’s Mission: Impossible – Dead Reckoning Part One in July, Teenage Mutant Ninja Turtles: Mutant Mayhem in August and PAW Patrol: The Mighty Movie in September. These will eventually make their way to the streaming side.
On the television side, Paramount plans to release Taylor Sheridan’s next show, Special Ops: Lioness, starring Zoe Saldana, Morgan Freeman and Nicole Kidman this summer.
Paramount grew its streaming subscribers in its first quarter, hitting 60 million on Paramount+, while its losses and investments in streaming also grew. While reaffirming that “content is king,” even amid a writers strike, Bakish said the company expects its second quarter subscriber additions to be “a little softer,” due to seasonality, but that subscriber growth should resume in the second back of the year, thanks to the combination of Paramount+ and Showtime.
In a report Thursday, Moody’s analyst Neil Begley said he expects a new agreement with the Writers Guild to cost media companies $250 million to $350 million per year. But given the impending negotiations with other unions, including the Directors Guild of America, the American Federation of Television and Radio Artists and the Screen Actors Guild, Begley expects the total annual cost to increase to $450 million to $600 million a year.
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