Paramount+ Will Raise Streaming Prices In Some Markets, Here's The Reason

Paramount + managed to add a significant number of subscribers. (photo: @ParamountPics)

JAKARTA - Paramount Global Inc announced it will increase the price of its flagship streaming service, Paramount+, in several markets after reporting lower-than-expected quarterly revenue.

Their television ad revenue fell 7% in the quarter ending December 2022, despite an increase from political ads in the US midterm elections in November.

Nonetheless, Paramount+ was able to add a significant number of subscribers due to the streaming of the film "Top Gun: Maverick", which helped the business in the face of declining demand for cable and pay TV. Paramount+ has added 9.9 million new subscribers, bringing its total subscribers to a record 70 million.

To prioritize streaming services, Paramount+ announced that it will merge Showtime with its streaming services across platforms later this year, and plans to increase prices for Paramount+ Premium and Essential subscriptions in the United States and some non-US markets.

However, sub-optimal sales and rising borrowing costs as well as falling consumer demand have forced companies to reduce advertising spending.

This also affected the performance of Paramount Global, which reported an operating loss in its direct consumer unit, which includes streaming services such as Paramount+ and PlutoTV. Although total revenue rose 2% to US$8.13 billion (IDR 123 trillion) in the quarter, it was still below market expectations.

Prior to the announcement of the price increase, Paramount Global Inc shares had increased by 45% from the start of 2023 to market close Wednesday. However, following the announcement, the company's shares fell by 7% before the market opened on Thursday, February 15.