TBI Weekly: Five questions for SkyShowtime’s new CEO

Star Trek: Discovery

This week’s appointment of Monty Sarhan as the CEO of SkyShowtime takes us one significant step closer to the launch of the new Comcast and ViacomCBS joint venture streaming service.

Expected to roll out across more than 20 countries later this year, the pan-European streamer will combine content from Comcast’s NBCUniversal and Sky, and ViacomCBS brands such as Showtime, Nickelodeon and Paramount Pictures.

The SVOD was announced in August, following months of speculation that Comcast and ViacomCBS were discussing an alliance to compete with the likes of Netflix, Amazon Prime Video, Disney+ and the expanding HBO Max.

Now with Sarhan, an alum of both Comcast and ViacomCBS, as well as MGM, in the hot seat, TBI considers five of the most pressing questions likely to be on the mind of the newly appointed CEO as the launch day nears.

Monty Sarhan

How will the streamer balance Comcast and VCBS content?

The two partners have a lot to offer this new joint venture, bringing a potential host of prominent brands to the table, from the likes of Star Trek: Discovery to the upcoming Bel-Air, which might have otherwise aired on Paramount+ or Peacock, respectively.

However, while both companies will have equal investment and joint control of the streamer, details as to exactly which shows will be on the service are yet to be announced.

“Don’t forget the Sky content as well,” highlights Tim Westcott, senior principal analyst at research group Omdia. “More broadly, balancing the operations and ambitions of two US media companies and a European partner is quite a challenge. It’s never really been done before. Is this a forced alliance, or is it something they can make work to their mutual benefit?”

On this point, Westcott also notes that while SkyShowtime is being launched in markets outside of Sky’s existing pay TV and OTT footprint, the companies will continue to compete in Sky markets for both “ad revenues and eyeballs.” To make a success of the JV, Comcast and ViacomCBS must co-operate and bring the full weight of their combined brands to bear.

Bel-Air

Will SkyShowtime be able to compete against the streaming giants?

Both NBCUniversal owner Comcast and ViacomCBS have been very clear about their respective international ambitions. Comcast CEO Brian Roberts has previously shared his desire to expand Peacock globally, with the streamer, which Comcast owns through NBCUniversal, currently only operating in the US, UK and Ireland.

Meanwhile, ViacomCBS’ relaunch of CBS All Access as Paramount+ last year led its global streaming expansion plans – alongside its growing AVOD Pluto TV.

However, global giants like Netflix boast more than 200 million subscribers, while Amazon Prime Video and Disney+ can both claim over 100 million, not to mention the host of regional players that SkyShowcase will be going up against.

Comcast and ViacomCBS seem to recognise going it alone in a growing and crowded European streaming market is going to be challenging – as such, the alliance appears to be a smart move. “It’s quite significant that they came to the view that there is not room for both Paramount+ and Peacock in Europe – outside of the Sky countries,” notes Omdia’s Westcott.

“It’s probably fair to say this is a prudent alliance which could enable them to get the maximum value out of their film and TV output in Europe and spread the cost of operating the platform.”

Raffaele Annecchino

Will there be SkyShowtime originals?

Worth rewinding a bit on this one: both Raffaele Annecchino, ViacomCBS Networks International’s president & CEO, and Sky’s chief exec Dana Strong, mentioned “speed” and “scale” when unveiling the service in August, and with 10,000 hours of existing content to stock it with, quantity isn’t an issue.

Yet while SkyShowtime is clearly a speed play, the nature of streaming means originals of some form will be vital for cut through. Those could come from existing commissions already made by Sky, Peacock and Paramount+, but the point of SkyShowtime is to address markets where the companies have no streamer presence – so it would seem odd for the service to operate in Spain, for example, yet offer Spanish subscribers no local original content.

The same goes across SkyShowtime’s proposed footprint – viewers in the hyper competitive Nordic streaming market have long become accustomed to local originals, in addition to US and European fare. It seems hard to see SkyShowtime surviving in the long term without them.

What are likely to be SkyShowtime’s growth areas?

Countries such as Spain, the Nordics, Hungary, Czech Republic, Poland and Croatia immediately jump out as sizeable markets that SkyShowtime’s backers might be able to leverage on the subscriber front. Not that this will be easy: Sky has already had a crack at Spain, for example, launching an OTT service there in 2017. Three years later, it was backing out of the country as competition from the likes of Netflix, Amazon Prime Video, Disney+ and HBO hotted up, alongside the major local players such as Movistar+, Atresmedia and Mediaset.

Dana Strong

What does SkyShowtime mean for Paramount+ & Peacock’s global ambitions?

For now at least, SkyShowtime seems to have put the brakes on a wider European roll-out for both Paramount+ and Peacock.

ViacomCBS and Comcast have clearly identified more value in joining forces to create a heavyweight SVOD than competing against one another – and in an environment that has already seen WarnerMedia and Discovery merging, it’s not a great surprise.

It’s worth noting that US studios also have legacy businesses that make rapid, Netflix-style global expansion tricky, which could play in SkyShowtime’s favour perhaps. HBO Max, for example, is being held up in some of the major European markets because of long-standing content deals with third parties, and ViacomCBS said last year it only expected to have Paramount+ operational in 45 countries by the end of this year.

As mentioned above, Peacock has also not expanded rapidly yet, and the deal underlines the necessity for US studios to combine their firepower quickly to secure a foothold in an industry that increasingly calls for scale – and which is ripe for consolidation.

Indeed, reports last summer suggested that ViacomCBS and Comcast’s NBCU were discussing just that, and while moves to combine in the US would be fraught because regulators would likely not allow one company to own both CBS and NBC, pragmatic solutions internationally are more viable. SkyShowtime seems to be the result of such an approach and if Sarhan can chart the nascent streamer to success, further similar tie-ups elsewhere in the world could well be on the cards.