Streaming hopes

Viacom and CBS combined last year in the hope that being bigger would mean better deals with cable distributors and larger video libraries for their own, in-house streaming services.

Some analysts are skeptical, especially as its first earnings report as a joint company disappointed investors. ViacomCBS swung to a quarterly loss. Its revenue fell and was short of expectations.

Fewer traditional TV watchers means pressure on companies that own TV networks. Viacom, whose cable networks target kids, teens and young adults, has lost a lot of viewers, weighing on how much the company is able to wrangle from advertisers and cable providers in fees.

Media companies such as ViacomCBS see a future in streaming. ViacomCBS said it’s trying to beef up its CBS All Access streaming service by adding shows from Viacom networks such as Nickelodeon and MTV and movies from its Paramount studio.

The company projects 35% to 40% growth this year in revenue from domestic streaming and digital video — namely ads and subscriptions from CBS All Access, Showtime and Pluto, its free service. But the $1.6 billion it got in 2019 is still a small part of the $27.8 billion revenue total for the company.

The chance of a revamped CBS All Access becoming meaningful for the company is low in a crowded market, said Bernstein analyst Todd Juenger. He believes the company would be better off licensing its shows to other streaming services rather than spending money on expanding its own service.