Paramount Global CFO Naveen Chopra has lauded Warren Buffett after his Berkshire Hathaway investment vehicle acquired about $2.6 billion worth of stock in the owner of CBS, MTV, Nickelodeon, Showtime and Comedy Central and the operator of the Paramount+ streaming service.
“We’ve always believed there’s a lot of upside, so it’s exciting to see someone with Berkshire’s track record see a lot of that same opportunity,” Chopra told the MoffettNathanson Media & Communications Summit during a session that was webcast. Buffett’s stake makes the legendary billionaire one of the largest outside investors in Paramount Global.
He added that Wall Street until recently believed legacy broadcast assets were “just a boat anchor” to be shed as studios grew their streaming businesses. “I think everyone is recognizing now that, no, these assets are actually the things that allow you to build a streaming business, that can actually generate profits and create value,” Chopra argued.
Related Stories
During his investor conference appearance, Chopra addressed the tough competition in streaming Paramount faces from the likes of Disney, Netflix and Warner Bros. Discovery. He argued the studio has enough hits and firepower from its “traditional world,” as he called his legacy broadcast assets, and Paramount+, the flagship streaming platform. “It’s that ability to move content through these different parts of the business to generate revenue across multiple platforms and multiple windows that makes the whole economic model work,” Chopra insisted.
He added that bringing together a broad range of content beyond scripted dramas — including news, sports and unscripted fare — would make Paramount+ a draw for consumers. And he coupled that with broad distribution platforms like Pluto TV, the studio’s free ad-supported streaming TV service, and a channels model for Paramount+ that includes Roku and Amazon, to leverage the studio’s pivot to the direct-to-consumer space.
Chopra also talked about SkyShowtime, a joint venture with Comcast that includes a new subscription video-on-demand service launched in more than 20 European territories reaching 90 million homes.
“It’s a very powerful content offering,” Chopra said of the partnership that allowed the studio to penetrate European markets where Paramount Global chose not to go it alone. And while insisting the studio’s default was to enter global markets solo, Chopra also touted another partnership deal with Bodhi Tree Systems, an investment platform backed by James Murdoch’s Lupa Systems and Uday Shankar, that includes financial backing from Reliance and Paramount Global to launch a TV and digital streaming giant in India.
That’s a market Hollywood players have traditionally been cautious to compete in. “For the skeptics, it’s a very smart way to play,” the Paramount Global CFO said.
Chopra also became the latest media exec to argue Netflix recently disclosing a loss of 200,000 subscribers during its most recent quarter had no direct impact on Paramount Global’s overall streaming strategy.
“There’s really nothing that has happened over the last few weeks that changes our strategy. If anything, I think it validates what we’re doing,” he said. Chopra argued Paramount Global has a diversified streaming model with subscription video-on-demand, ad-supported streaming platforms and hybrid offerings, against a subscription video-on-demand model for Netflix.
“This really goes to understanding the differences between what we’re doing with streaming, versus a pure play as far as a business,” he said. The studio’s finance chief also said Paramount Global was “dialing back” on content franchises and originals, especially to license to third party platform buyers.
Specifically, he said expect fewer higher-cost scripted series on linear TV platforms and more cheaply-produced reality TV series on the studio’s streaming platforms. At the same time, Chopra reiterated that leveraging legacy broadcast assets along with newer streaming platforms was key to monetizing the studio’s content creation investments.
“If you don’t have that, if all you got is a streaming piece, it’s much tougher,” he insisted. And, on the movie side, Chopra gave his backing to the exclusive theatrical window.
He said the 45-day theatrical window, with a fast follow for film titles on streaming platforms, was the studio’s preferred release model. “That allows us to capture the vast majority of the box office revenue,” Chopra said, as market data points to most movies not generating much revenue after that 45-day run at the multiplex.
Expect more tentpoles from Paramount Global, as the studio looks to draw consumers and make a healthy return. “You’re probably not going to make as many small movies. The big movies have to make financial sense,” Chopra argued.
