Paramount Global shares closed up nearly 10% on Friday, leading the gains in entertainment stocks. wall street journal We reported that Paramount Global and Apple are in talks to bundle their respective streaming platforms at a discounted price.
There is a growing consensus that there may be too many standalone services for the market to survive. Industry executives and Wall Street agree that bundling can lower costs for consumers, reduce provider churn, and otherwise makes sense, and they expect more bundling. This is a move that falls short of the outright M&A that many are predicting as media companies grapple with streaming losses and the decline of terrestrial television.
of WSJ Negotiations to bundle Paramount+ and Apple TV+ are reportedly in the early stages.
Verizon has bundled Max with Netflix, and CEOs from Warner Bros. Discovery’s David Zaslav to Paramount’s Bob Bakish have increasingly voiced support for third-party bundles. The company already works internally with Disney and has been offering bundles of Disney+, ESPN+, and Hulu for some time.
Paramount has a number of partnerships to drive streaming growth, including with Walmart+ and Delta in the US, and internationally with Sky in the UK, Italy and Germany, Canal+ in France and JCOM in Japan. , in partnership with CJ Media in South Korea, and recently in Greece with local cable provider Cosmote. On Paramount’s last earnings call, Bakish said the partnership was a “significant contributor to our momentum” and that “this new phase of expansion is just beginning.”
The company declined to comment on this report. An Apple representative could not immediately be reached.
Paramount stock rose 9.8% to close at $15.78. Apple was flat. Streaming services are part of the tech giant’s fast-growing services division, but they’re still only a small part of its business. The company’s Apple TV portal, which allows it to charge high fees for all the streaming subscriptions it generates, is a much bigger and more lucrative field than Apple TV+.
“Apple has a lot of influence,” Barton Crockett, a media analyst at Rosenblatt Securities, said in an interview with CNBC. “Apple is a different bird, so let’s see how they do.” [Paramount] You can negotiate with Apple. Looking at the bigger picture, it’s very clear to me that over time streaming needs to migrate to these big tech platforms. And I thought that was going to happen, the breakup, the sale of the library, the sale of the sports assets. “Certainly, these kinds of partnerships and these kinds of comprehensive bundles may be some kind of partial steps,” he said.
“But I also don’t know if Paramount would be the only participant if Apple were to go in that direction.”