Warner Bros Discovery (WBD) has shown interest in potentially unifying its cornerstone streaming service Max with Paramount Global’s flagship service Paramount Plus with Showtime, according to a report published on Monday.
The report, from CNBC, said Paramount is exploring different strategic options for its streaming products, including partnerships that could marry the company’s intellectual property with that of another entertainment giant.
Paramount’s intellectual property includes hit TV franchises like “Paw Patrol,” “Spongebob Squarepants,” “Frasier,” “Yellowstone” and “I Love Lucy,” among others. Its cable brands churn out a high volume of original series like “Ridiculousness” (MTV),” The Daily Show” (Comedy Central) and “Tyler Perry’s Sistas” (BET Media). Paramount Pictures is the studio responsible for franchises like “Top Gun,” “Mission: Impossible” and “Star Trek.”
WBD was one of several parties who have approached Paramount about some type of business or content tie-up over the past year. Last December, reports emerged that showed WBD’s CEO David Zaslav and then-Paramount CEO Bob Bakish had engaged in discussions about either merging parts of their business or forming an entertainment-focused joint venture. Those talks fizzled out around the time Paramount engaged in pre-merger discussions with production company Skydance Media on an exclusive basis, with Bakish departing Paramount a short time later. The Paramount-Skydance talks broke down last month.
A joint venture would not be unfamiliar territory on Paramount’s end — the company offers its intellectual property through a similar partnership with Comcast’s NBC Universal in parts of Europe and North Africa. The partnership, called Sky Showtime, is available in more than two dozen countries, operates on the same technology platform as Peacock in the United States and includes content from NBC Universal as well.
Less clear is what form the partnership would take place. One potential strategy could see Paramount and WBD continue to operate their streaming services as separate businesses, with both offering the opportunity for subscribers to take the other service. That plan would likely be marketed as a “bundle” offering, where customers of Max could purchase Paramount Plus and Showtime content for a separate monthly fee, and vice-versa.
A more-complicated plan would involve merging Max and Paramount Plus into a single standalone service, which would require WBD and Paramount to work together on technical and financial strategies to bring customers of whichever service shuts down (likely Paramount Plus) into the surviving service (likely Max). It would also require the companies to renegotiate distribution deals with third parties like Roku, Amazon and YouTube, which re-sell access to Max and Paramount Plus in their streaming marketplaces.
Another possible plan is to launch a third streaming service that includes the content libraries of Max and WBD, but which is a standalone business operated through a joint venture. Sky Showtime is an example of one such business; WBD is also participating in Venu Sports, a standalone product that also counts Fox Corporation and the Walt Disney Company’s ESPN among its investor-owners.
