Outlining the studio’s plans to make it through Thursday’s Writers Guild of America strike, Paramount Global CEO Bob Bakish said Paramount has prepared for that possibility, including a slew of new releases and moving production to abroad to get through en.
“Authors are an integral part of creating content that our audience enjoys, truly cross-platform. And we hope to come up with a solution that works for everyone pretty quickly. But it’s also fair to say there’s a pretty big gap today,” Bakish said in response to an analyst question. “So obviously that’s what we planned. We have many levers to pull and that will allow us to get through this strike, even if it lasts for a long period of time. In terms of these levers, we have a lot of content in the can, so to speak. So other than things like Late Night, consumers are really going to be ignorant of that for a while.”
“Add to that a broad spectrum of reality and unscripted, where we’re definitely leaders, and sports and that’s unaffected. And so we can do more than necessary in these areas and again and again, we have a leadership position overall. Also, we have offshore production that we relocated to take advantage of the pre-strike period,” he said, adding that Paramount also has “one of the largest media libraries.”
As for the financial impact, Bakish said it will depend on the length of the strike. However, he anticipates that this will likely be “slightly dilutive” to sales, flat on operating income before depreciation and amortization, and positive for cash.
Bakish’s comments echo earlier statements by others, including Netflix CEO Ted Sarandos, who had said Netflix could weather a writers’ strike better than others because of its large content library. David Zaslav, CEO of Warner Bros. Discovery, had made similar comments about his streamers’ library.
WGA members picked in front of Paramount’s LA headquarters this week, as well as numerous other studios including Amazon, Netflix and Warner Bros. Discovery.
The upcoming content list for Paramount includes the release of four franchise films in the coming months, Bakish said, including Transformers: Rise of the Beasts in June Tom Cruises Mission: Impossible – Dead Reckoning Part One in JulyTeenage Mutant Ninja Turtles: Mutant Mayhem in August and PAW Patrol: The Mighty Movie in September. These will eventually find their way onto the streaming site.
On the television side, Paramount is planning to release Taylor Sheridan’s next show, Special Units: Lioness, with Zoe Saldana, Morgan Freeman and Nicole Kidman this summer.
Paramount grew its streaming subscriber base to 60 million in the first quarter on Paramount+, while its losses and investments in streaming also increased. While reiterating that “content is king,” even amid a writers’ strike, Bakish said the company expects second-quarter subscriber growth to be “slightly slower” due to seasonality, but that subscriber growth will slow in the second half of the year should stop again thanks to the combination of Paramount+ and Showtime.
In a Thursday report, Moody’s analyst Neil Begley said he expected a new deal with the Writers Guild to cost media companies $250 million to $350 million a year. However, with upcoming negotiations with other unions, including the Directors Guild of America, the American Federation of Television and Radio Artists and the Screen Actors Guild, Begley expects the total annual cost to rise to between $450 million and $600 million.