As Americans’ viewing habits change CBS seems to be the outlier in the race to reach viewers unlike many of its competitors that have decided to partner with services such as Hulu, Sling TV, PlayStation Vue, and even the new DirecTV Now service.
Where competitors such as Fox and ABC have jumped in with both feet CBS corporate has held back. (Although some independent CBS channels have joined services such as PlayStation Vue, CBS-owned channels have held back.)
CBS seems to be putting the future of the network on the back of their CBS All-Access service. Their hope seems to be that their content will drive millions of Americans to subscribe. The problem is this puts all of their hopes in one service.
Unlike competing services such as Hulu and even services such as Sling TV CBS All Access has a fraction of the content. Would you rather pay for CBS content or get access to Fox, NBC, ABC, and a host of other networks and movies with Hulu? Would you rather pay for Sling with live access to a range of channels or CBS All Access with one channel?
Here are a few areas CBS All Access fails to hold up to their competitors.
CBS All Access advertises 8,000+ episodes—not shows but episodes. Compare that to Netflix that recently had 4,335 movies and 1,197 shows. (A show can have anywhere from 10 to 22 episodes. If on average they have 15 episodes they could have over 17,000+ episodes. If they averaged just 10 episodes they would have 11,970 episodes.) That leaves you wondering if you are getting what you pay for with CBS All Access.
The second issue is the price. Starting at $5.99 for limited commercials or $9.99 a month for a commercial-free option it makes it hard to stand out against similarly priced services, especially when many Americans can get CBS over the air for free.
Why will this result in CBS’s failure?
CBS is playing a risky game here. Other networks have their content in multiple services allowing them to gain revenue even if you didn’t go to Hulu or Sling for Fox content. This diversification allows Fox and others to avoid potential revenue loss.
CBS is setting themselves up for a single point of failure by limiting the vast majority of their content to just one service at a high price.
If I had to pick one network at the greatest risk of failure right now it is CBS.
So what should CBS do?
CBS has two options. They could lower their price to a more reasonable $2.99 for CBS content with ads. This price would likely attract a much larger audience and bring in more revenue.
CBS could keep CBS All Access with their original shows such as the new Star Trek show and put other content on services such as Hulu and DirecTV Now. This would allow them to diversify their revenue and still get a premium price for their original shows.
Hopefully CBS will see there is a benefit to making their content more available to cord cutters without requiring them to pay a premium price for a small catalog of shows.
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