Viacom’s Skinny Bundle: Right Ideas, Wrong Execution
Hardly a month goes by without talk of a new OTT video service on the horizon. The latest: a skinny bundle from none othre than Viacom.
Viacom’s new CEO, Bob Bakish, has been outspoken about his company’s disinterest in the past, preferring cable and satellite distribution, and virtual pay-TV offerings from the same MVPDs, to SVOD services like Netflix.
I’ve often spoken of Viacom’s hidden potential: a vault full of popular content, appealing to young audiences, that just needs a means to connect with a target demographic that’s least likely to have the sort of pay-TV that Bakish favors.
In pitching this upcoming skinny bundle, Bakish has in fact made some of the smartest statements to come out of the company since former CEO Philippe Dauman’s ouster. But the company still faces an uphill battle, and a skinny bundle centered around Viacom’s channels doesn’t quite make sense in the market.
The Good
Bakish cued in on the big challenge facing cable TV, as well as other skinny bundles: price. $40 or more is too high for virtual pay-TV, he argued.
His proposed solution? Extracting sports from the basic bundle.
Right on.
With television widely seen as too expensive, getting pricey sports out of packages is a huge opportunity for savings, and a welcome one for any non-sports fans that have long been suckered into subsidizing ESPN for the rest of us.
Viacom sees a bundle in the $10 to $20 range, calling it an “Entry Level” product.
The Bad
If Viacom plans to go it alone, even at those low price points, they will struggle. Hopefully they have some partners on board by the time they launch, as Viacom’s lineup of networks illustrates the heart of the problem with traditional and virtual pay-TV alike.
Many of Viacom’s networks are popular. But who are they popular with?
Completely different audiences!
In many cases, these audiences are nearly mutually exclusive. How many viewers would regularly tune in to both BET and CMT? Is there any overlap between college-age viewers of MTV U and the older demo that might enjoy TV Land? Would the same person who watches the often mature content of Spike also have any use for the preschool programming on Nick Jr?
Even if you’re a super fan of Comedy Central, for example, because Viacom insists on a bundle, in order to get it, you’ve got to pay for nearly a dozen potentially unwanted channels just to get the one or two that you like.
It’s the very same problem that consumers have with cable TV, on a smaller scale.
A cheaper bundle may score some sales, but the real solution for Viacom and the rest of the TV industry is still a web-based à la carte distribution model.
