Published on September 24th, 2017 | by Brad Gibson0
Apps Slowly Adding to Network Revenue, Columnist Finds
Network streaming apps like CBS All Access and HBO Now are having a minimal impact on revenue for their owners, at least for now, according to “reasonable assumptions” by Variety Media & Money columnist Jan Dawson.
Dawson’s research gives evidence that “though none of the companies reports revenue from its streaming services directly…subscriber numbers for these services are growing nicely,” and that their “contribution they’re making to overall revenues for their parent companies are still pretty marginal.”
Dawson estimates CBS All Access, HBO Now, Showtime and Starz likely generate less than $100 million per quarter each at the moment, though HBO Now is rapidly approaching that mark. Three of the four are still under $50 million per quarter, he reports. In context, Dawson believes, “HBO Now likely generated around 5%-6% of HBO’s revenue and 1% of parent Time Warner’s revenue in the second quarter (of 2017).”
Streaming services like these are contributing more and more to revenue growth, he reports. “For CBS’ Cable Networks segment, streaming likely accounted for nearly all its year-on-year revenue growth in the second quarter,” he wrote.
Dawson surmizes that with cord cutting by consumers an ever-increasing threat to the cab;e and satellite industry, “TV companies’ direct-to-consumer offerings will be an important bulwark against revenue shrinkage.”
All four of the networks Dawson used as examples on his story are available as subscriber apps on Apple TV.