December 2, 2023

The last year has been difficult for media companies fighting it out over the growing streaming market, and Paramount Global is no exception. We have already seen how pressure from investors has pushed the company to focus on costs. This impacted the Star Trek franchise on Paramount+ when the fifth season of Discovery became its last and Prodigy was removed from the platform entirely, to be licensed to a 3rd party. Trek fans may be wondering what’s next for the television franchise, there are some clues in the latest statements from top Paramount executives to the investment community.

Right content for right audience at right time

On Monday afternoon, Paramount Global released their 2nd quarter financial results, a process which also included a conference call with the investor community. On the call were CEO Bob Bakish and CFO Naveen Chopra, and while neither specifically talked about Star Trek, their commentary will surely impact how Paramount+ handles the franchise going forward. The company reported a loss for the second quarter; streaming losses are shrinking while subscriber numbers have grown to 61 million. One thing made clear during the call is that Paramount is slowing down spending on content, with Bakish confirming that 2023 will be the company’s “peak investment year in streaming,” so it can “remain on track to deliver significant total company’s earnings growth in 2024.”

Bakish highlighted how the various franchises in the Paramount portfolio are key:

Our franchises continue to grow in number and scale. We have a growing roster led by more than a dozen franchises that have grossed over $1 billion in revenue.

The CEO pointed out that the focus on costs is changing how Paramount spends money on streaming:

We are evolving our streaming content slate to super-serve key target audiences more efficiently. This is based on all we’ve learned since Paramount+ launched.

CFO Chopra offered some more details:

When it comes to streaming content, we’ve learned a lot from Paramount+ subscribers over the past 2.5 years, what attracts them to the service, what keeps them there. And therefore, what we want to invest in.

During a Q&A, Chopra talked more about this new approach to content:

We’re accomplishing that [spending] goal by leveraging content across platforms more and more by leaning into franchises. And now that we’ve got more data, we’re increasingly able to use analytics to understand how to super serve these key audience segments.

We are laser-focused on improving the efficiency of our content spend going forward… And now that we’ve got more data, we’re increasingly able to use analytics to understand how to super-serve these key audience segments. And so we can get away from, call it, a volume-focused game and be more focused on making sure that we have the right content for the right audience at the right time.

From Star Trek Day event in 2022 (Paramount+)

Not too little, but not too much content

Chopra offered some detailed examples of how they are looking at subscriber data to make content decisions:

We’ve learned that success is not purely a function of content volume. It’s having the right content for the right audience at the right time. For example, we know that if a Paramount+ subscriber watches 4 hours or more of content in a month or engages with more than two different series, they are over 30% less likely to churn from the service. With these types of learnings, we’ve carefully defined specific audience segments and have evolved our programming strategy to super-serve them in an even more efficient manner. Our programming slate is designed to ensure that each key audience segment has compelling content to enjoy throughout the year, not too little, but also not too much. The content charges we took in the first half of 2023 reflect this go-forward targeted programming strategy.

Chopra’s comment about changes taken during the first half of the year included the decision to end Discovery and remove Prodigy from Paramount+ (to license it to a 3rd party). It may also have been a factor in the decision to pivot the Section 31 project from a series to a single TV movie, although Michelle Yeoh’s busy schedule was also a likely factor. Star Trek: Picard also wrapped up earlier this year, however, it was always planned to run just three seasons. And it seems clear the company is not done yet when it comes to deciding how to spend money, especially on the various franchises, which would include Star Trek. It’s worth noting that so far in 2023, the only Paramount+ shows that have made it into the Nielsen streaming Top 10 are Star Trek shows (Picard and Strange New Worlds) and Taylor Sheridan shows (1923). Bakish noted the new Sheridan-produced Special Ops: Lioness was the most-watched global series premiere for the service.

Currently, Paramount+ has committed to producing a third season of Strange New Worlds and a fifth season of Lower Decks, as well as launching a new Starfleet Academy series and a Section 31 streaming TV-movie event starring Michelle Yeoh. Work on all of those projects had already begun, and were in various stages. It’s possible Paramount will just stick with that plan, at least in the short term. However, with all live-action show production and writing halted due to the ongoing WGA and SAG-AFTRA strikes, the analysts at Paramount will have even more time to look over their data and this could factor it into upcoming production plans across the service and Star Trek. It’s almost certain any data-driven assessment of Star Trek aiming to “super-serve” the fanbase would take a look at the idea of a Picard spin-off like the Star Trek: Legacy series as envisioned by Picard season 3 showrunner Terry Matalas. As for bringing Prodigy back to Paramount+, that decision is not likely to be reversed as the company has already factored that into its financial results. It’s also possible that even with the success of Star Trek content on the platform, spending constraints could reduce or spread out upcoming Trek TV on the platform. We probably won’t know which way the company is headed with Trek for months, possibly even until 2024.

Remember, Paramount+ prides itself on being “the home of Star Trek,” as seen in this promotional video released at Comic-Con…

Paramount sells Simon & Schuster

Since the re-merger of Viacom and CBS the newly formed Paramount Global has been trying to sell off its publishing arm Simon & Schuster, as it is not seen as part of the company’s core focus of filmed and video content distribution. A previous deal with Penguin Random House ran into regulatory hurdles and had to be dropped. But yesterday, the company announced a new deal to sell S&S for $1.6 billion to KKR, a private equity firm. Money from the sale will be used to pay down debt.

Simon & Schuster has held the license to produce Star Trek books starting with the novelization of Star Trek: The Motion Picture in 1979. The publisher has been releasing Star Trek novels and audiobooks under the Pocket Books brand and others over the decades. A new Discovery book came out in May, and a YA Prodigy book and a newly recorded audiobook for a classic DS9 book were released just last week and there is a new Picard tie-in is lined up for early 2024. It is unclear what impact, if any, the sale will have on the Star Trek license.

Simon & Schuster published Star Trek: The Entropy Effect (1981) and Discovery: Somewhere to Belong (2023)

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