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ViacomCBS is Going All in on South Park

5 August, 2021
South Park

South Park creators Matt Sone and Trey Parker have signed a $900 million deal with ViacomCBS to produce six more seasons of the popular animated series and create 14 South Park films for Paramount+. 

The news arrives as ViacomCBS announces Q2 earnings, boasting an additional 6.5 million global streaming subscribers across its suite of services, totaling more than 42 million. Those figures represent an 82% year-over-year growth in subscription revenue that is “fueled by the growth of Paramount+,” although ViacomCBS did not break out individual streaming numbers for Paramount+.

Here’s what we do know about Paramount+: In the second fiscal quarter of 2021, ViacomCBS owned the second highest corporate demand share of any US media conglomerate. Eventually, once the WarnerMedia and Discovery deal goes through, ViacomCBS will fall to third, but on its own, currently, it’s second only to Disney. 

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At the same time, Paramount+ clocked in as having the sixth most in-demand streaming platform for US audiences. That’s ahead of Disney+, but considering the size and demand for ViacomCBS content in general, it’s not superb. 

South Park is a perfect example of how ViacomCBS’ content is helping Paramount+’s competitors. The show is streaming exclusively on HBO Max in the United States. WarnerMedia bought the domestic streaming rights to the series for more than $500 million when HBO Max first launched. 

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While those rights will eventually revert back to Paramount+, and it’s evident that executives plan to use the South Park suite (plus new original films) to bring in subscribers and reduce churn, South Park has helped HBO Max find part of its audience in the meantime. The demand for series licensed from ViacomCBS to various platforms, compared to demand for licensed series from other sources, makes up nearly 10% of HBO Max’s catalogue. 

This is less than Amazon Prime Video, Netflix, and Peacock, where demand for series licensed from ViacomCBS compared to demand for licensed series from other sources sits at around 25% of their entire catalogues. South Park, however, is arguably one of the biggest demand drivers from the ViacomCBS library. 

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South Park was the third most in-demand title on HBO Max over the last 365 days, coming in just behind Game of Thrones and Rick and Morty, which belong to WarnerMedia properties (HBO and Adult Swim respectively). South Park became a key demand title for HBO Max - not Paramount+ - over the last year as executives were trying to grow the new service.

Instead of using South Park to bolster Paramount+ at launch, executives went with a guaranteed source of revenue. This helps cushion some of the costs that come with launching a streaming platform, and gives executives room to order more original series. Highly anticipated new shows or films bring in subscribers (hence 14 South Park movies), and fan favorites keep subscribers from canceling (hence new South Park seasons). 

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As CEO Bob Bakish told investors and analysts in November 2020, “content licensing is an important business,” adding that “We can’t keep all that for ourselves. It doesn’t make sense. It’s too much.” Licensing South Park to HBO Max for a few years helps ViacomCBS generate revenue needed to build its streaming business — something that Bakish touched upon, noting that “our strategy is clearly evolving, particularly with Paramount+.”

As it stands right now, ViacomCBS maintains one of the largest catalog libraries boasting some of the most in-demand content, from Spongebob Squarepants to Avatar: The Last Airbender and South Park. The issue for Paramount+ is that not all of these shows are available exclusively on ViacomCBS’ new streaming platform. 

Eventually, it seems, the goal is to bring many of them in-house exclusively — or at least license out fewer seasons to competitors. South Park will be a test to see if having one of the most in-demand series in the world will convince swaths of potential subscribers to sign up, and keep them watching Paramount+. 








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