September 26, 2024

Paramount global and local sales chiefs on converged trading, blended CPMs and why allowing streaming subscribers to opt into ad tiers is optimal

33 minutes

Paramount went early on both converged trading and a streaming ad tier in the US. Now it’s doing likewise in Australia and Lee Sears, Paramount’s international ad sales chief, thinks both plays will pay off for the media and entertainment conglomerate, its advertisers and crucially – viewers.

Unlike some rivals, Paramount didn’t push subscribers automatically onto the streaming ad tier. Sears says it didn’t need to, because “we have a huge audience elsewhere, so don’t have to be reliant on just the SVOD ad tier”. He suggests forcing ads onto subscribers that signed up for an ad free service wouldn’t be right. Either way, the strategy appears to be paying off.

Locally, sales chief Rod Prosser won’t divulge numbers, though analysts Telsyte estimate Paramount SVOD subscribers at 1.8m, with sign-ups outstripping its competitive set. Prosser said the reality is much higher than the Telsyte estimate and, confirmed “We are still the fastest growing [SVOD]”.

Moreover, Sears suggests Paramount’s subscribers are actually using the service amid some “wild” numbers being touted in market, per OMG investment chief Kristiaan Kroon, “because it's not an add-on to something else, or it's not a byproduct of a bill that you're paying elsewhere within your household”.

On converged trading across BVOD, SVOD, AVOD and FAST (linear TV’s set to follow locally in H2 next year), Sears says the approach is now driving a “major” chunk of revenue in the US and other global markets. He anticipates Australia will follow that playbook: “It is now part of everything we do … Converged trading, connecting everything together, is how we lead with our conversation. I think that’s the way everybody will try to lead conversations in the future, unless you only have a one-dimensional play.”

Part of the converged approach is a “blended CPM”, i.e. a bundled price that factors in the different channels the ads run across. Prosser said how that pricing works has been the biggest question from agencies in recent weeks, alongside bringing linear TV into the converged mix.

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