Paramount Global will increase the price of its two Paramount Plus streaming tiers, executives affirmed during a conference call with investors and reporters on Thursday.
Later this year, the cost of the Paramount Plus Essentials tier will increase to $6 a month, a $1 increase from its current price of $5 a month. Likewise, the cost of the premium tier of Paramount Plus will move from $10 a month to $12 a month. The price changes will impact both new and current customers alike.
Naveen Chopra, Paramount’s chief financial officer, said the move will help boost average revenue per user (ARPU) among Paramount Plus subscribers. ARPU is a key metric that shareholders value, to see the average revenue a streaming service makes per paid customer.
Chopra also revealed that the Paramount Plus premium tier, which will be called Paramount Plus with Showtime, will include content from the Showtime multiplex movie network, as well as commercial-free access to on-demand content and a live feed of a subscriber’s local CBS station or affiliate. Paramount Plus Essentials won’t include Showtime content or the live CBS feed; both tiers will still continue to offer a selection of live sports.
“Wat we’re doing is tying a bigger price increase on the premium tier to a significant expansion of content while keeping an easily accessible entry point on the essential tier,” Chopra said. “And we’ll continue to take advantage of promotional pricing, annual plans and bundles as a way of both maintaining the funnel for new customer acquisition while optimizing churn and growing ARPU.”
The price increase will impact users in the United States first, though Chopra said Paramount Plus will offer tired programming packages in international markets over time. In the United States, the price changes will kick in during the company’s third financial quarter, which coincides with the start of the National Football League’s new season. Along with Fox, CBS offers Sunday morning and afternoon NFL games.
Paramount Plus added nearly 10 million new subscribers during the company’s fourth quarter, the company reported on Thursday, ending the year with 56 million Paramount Plus subscribers globally. Combined with other streaming services like the standalone version of Showtime (which will soon close), BET Plus and Noggin, Paramount has 77 million global direct-to-consumer subscribers.