• by Wayne Friedman , May 3, 2019

In an effort to show off premium TV programming strength versus growing competitors -- traditional and OTT -- CBS will spend $8 billion in TV production this year.

“[It] positions us competitively with any player in the marketplace, says Joe Ianniello, president/acting CEO, CBS Corp, during its first-quarter financial earnings call.

Netflix is spending about $15 billion level on programming -- original and acquired -- according to estimates. WarnerMedia, NBCUniversal and Walt Disney are estimated to spend around $10 billion to $12 billion each. Amazon is projected to spend around $6 billion this year.

Todd Juenger, media analyst at Bernstein Research, noted that any comparisons can be somewhat misleading -- especially when including sports. CBS, NBCU and Disney spend billions on sports, something Netflix does not air.

Taking out sports, he estimates CBS entertainment spend will be around $4 to $5 billion.

Still, Ianniello notes CBS draws big audiences for its entertainment shows, touting 11 prime-time series averaging over 10 million total viewers each week — “more than any other network.”

CBS posted strong double-digit percentage gains in ad revenues in the first quarter. That's due to the Super Bowl, as well as similar overall gains in affiliate/subscription revenues. 

Overall revenues were up 11% to $4.2 billion -- with ad revenues 18% higher to $2.04 billion and affiliate/subscription revenues rising 13% to $1.1 billion.

At the same time, CBS said its network's core ad revenues -- sans Super Bowl -- only grew 1%. Affiliate/subscription fees at its entertainment unit grew 26%, driven by subscriber growth at CBS All Access and increases in station affiliation fees and revenues from virtual MVPDs.

CBS cable networks' revenue -- Showtime Networks, Pop and Smithsonian Networks -- dropped 3% to $571 million. CBS publishing revenues grew 3% to $164 million.

CBS net income tripled to $1.58 billion, due to a one-time boost from a tax benefit from a reorganization of CBS’ international operations.

Jim Lanzone, president/CEO of CBS interactive, says CBS All Access and Showtime are on track to get 25 million collective subscribers by 2022. He says of their current 8 million subscriber total, two-thirds choose the limited commercial option and one-third choose the commercial-free option.

Looking at scatter advertising, Christina Spade, executive vice president-CFO CBS Corp., said the CBS Television Network is up “more than 25% in prime-time from our upfront pricing and even more in late nights.”

She also said local TV station advertising is pacing up low single digits in revenue growth, with the first quarter up about 10%.