Showtime, along with HBO, once ruled the edgy episodic programing market – a position increasingly under siege by subscription streaming video services such as Netflix, Amazon Prime Video and Hulu.
As a result, CBS-owned Showtime now finds itself trying to stay competitive with Netflix, which is spending $8 billion on original TV shows and movies this year. It launched a branded SVOD service in 2015 – now more than 2.5 million subscribers.
Speaking March 12 at INTV confab in Jerusalem, Showtime CEO David Nevins the onslaught of over-the-top video and episodic programing has resulted in Showtime “punch[ing] above our weight” in an effort to keep up.
“It’s a deluge right now, particularly from the streamers — Netflix more than anything,” Nevins said, as reported by Variety. “They’re still in high-growth mode. They’re not trying to deliver earnings.”
Maybe, but Netflix is delivering earnings. The streaming pioneer generated $627 million in profit on revenue of more than $11.1 billion in 2017. It now has more than 117 million subs globally.
Nevins contends that while Netflix is chasing headlines signing marquee content creators, Showtime is targeting curated programing such as “The Chi,” “Our Cartoon President,” “Homeland,” “Billions” (returning March 25), “I’m Dying Up Here” and “The Affair” (returning June 17), “Ray Donovan,” and pending “Escape at Dannemora,” from Ben Stiller, and “Patrick Melrose,” starring Benedict Cumberbatch, among others.
“There’s a counter-narrative that’s beginning that’s helpful to us,” he said.
Speaking in January at the Television Critics Association’s winter press tour, Nevins said Showtime has the budget to attract top talent in and front behind the camera. Referencing the New York Yankees, he added that unlimited spending doesn’t guarantee success.
Indeed, Showtime in 2017 had its biggest ever year of subscription revenue growth and, on a percentage basis, the best sub growth in 16 years.
“But we are … maintaining our margins,” Nevins said. “We are spending more money because we are generating more revenue.”