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Home>UPDATE: Can 'Star Trek: Discovery' help make CBS's stand-alone streaming pursuit successful?

UPDATE: Can 'Star Trek: Discovery' help make CBS's stand-alone streaming pursuit successful?

UPDATE: Can 'Star Trek: Discovery' help make CBS's stand-alone streaming pursuit successful?

10/05/2017

By Trey Williams, MarketWatch

CBS is the top content play in the media space, according to Benchmark analyst Daniel Kurnos

CBS Corp. said Tuesday that its streaming service, CBS All Access, has seen a record number of new subscribers in a single week, driven by the debut of its new original series "Star Trek: Discovery."

"Star Trek: Discovery" is currently one of CBS All Access' two original series streaming only on the service and not on traditional TV. The other is CBS's "The Good Wife" spinoff, "The Good Fight."

"Star Trek: Discovery" has received fanfare through its first three episodes. People have also complained, however, about needing to spend the $6 a month it costs to subscribe to All Access to watch the series. "Star Trek: Discovery" isn't available with viewers' regular cable subscription.

Check out:More TV viewers are cutting the cable cord, but the savings aren't what they were (http://www.marketwatch.com/story/cable-cord-cutting-is-accelerating-but-at-what-cost-2017-09-13)

The show's success thus far has spawned debate about whether the subscription is worth it.

CBS (CBSA) hasn't given definitive subscriber numbers for All Access, but the company's commentary indicates a good deal of viewers see All Access as a valued addition.

"Consumer response to the launch of 'Star Trek: Discovery' has been tremendous," Marc DeBevoise, president of CBS Interactive, said in a statement. "The buildup to the show's premiere led us to a record-setting month, week and ultimately day of sign-ups. The second week of the series has also exceeded our expectations."

Evercore analyst Vijay Jayant wrote in a recent note to investors that CBS's stand-alone streaming pursuit is one reason he feels the network is insulated from the impacts of cord-cutting.

"The company's proprietary over-the-top services hedge against changes in pay-TV distribution," Jayant wrote.

Also read:Analyst lowers CBS earnings estimates, but sees buying opportunity (http://www.marketwatch.com/story/analyst-lowers-cbs-earnings-estimates-but-sees-buying-opportunity-2017-10-03)

Despite not providing subscriber numbers, CBS Chief Executive Leslie Moonves said during the company's most recent quarterly conference call that All Access and the Showtime streaming platform are expected to pass 4 million subscribers combined before the end of the year.

In February, Variety reported that Showtime hit 1.5 million subscribers and that All Access was near the same mark.

It can be difficult building a successful streaming platform from scratch, especially if it doesn't offer more than content from broadcast and cable networks. For example, Netflix Inc. (NFLX) and Hulu -- a joint venture of Walt Disney Co. (DIS) , 20th Century Fox Inc. (FOX) , Comcast Corp. (CMCSA) and Time Warner Inc. (TWX) -- had to explore original programming to drive growth.

As media companies focus more on hoarding exclusive content (http://www.marketwatch.com/story/netflix-wants-exclusive-rights-to-films-tv-shows-and-the-talent-creating-them-2017-08-16), intellectual property such as "Star Trek" should help the network and its streaming platforms going forward.

Check out:Disney is accelerating the shift to streaming TV, and Wells Fargo says investor fears are overblown (http://www.marketwatch.com/story/disney-is-accelerating-the-shift-to-streaming-tv-and-wells-fargo-says-investors-fears-are-overblown-2017-09-05)

See:Netflix might add more subscribers than expected in the third quarter (http://www.marketwatch.com/story/netflix-might-add-more-subscribers-than-expected-in-the-third-quarter-2017-10-04)

In a note to investors last week, Benchmark analyst Daniel Kurnos wrote that "Star Trek: Discovery" was a meaningful driver of adoption for CBS All Access.

"We continue to view CBS as our top content play in the media space," Kurnos wrote. "We generally agree with the headline that cord-cutting is good for CBS, as long as the premise of increased year-over-year viewing of content hours continues to hold."

Shares of CBS have fallen nearly 6% year-to-date, while the S&P 500 index is up more than 13% and the Dow Jones Industrial Average is up nearly 15% during the same time period.

-Trey Williams; 415-439-6400; AskNewswires@dowjones.com

 

(END) Dow Jones Newswires

10-05-17 1037ET

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