is bringing 14 more channels to Hulu’s live television service. But following an early pop after the market opened, the stock closed down for the day amid a broader market drop.
ViacomCBS (ticker: VIAC) said the multi-year deal will keep CBS, CBS Sports Network, and The CW, among others, on
(DIS) Hulu + Live TV, while adding 14 networks from the pre-merger Viacom, like Nickelodeon, Comedy Central, MTV, and BET.
Hulu + Live TV is a so-called virtual multichannel video programming distributor, or vMVPD, that gives cord-cutters access to live programming, including news and sports. The service, at $64.99 a month, starts to resemble its standard cable competitors with more than 65 live channels. As the name suggests, it also includes the Hulu streaming service.
“Hulu continues to be a great partner, and this agreement ensures that Hulu + Live TV subscribers are now able to enjoy the full breadth of our leading content across news, sports and entertainment for the first time,” Ray Hopkins, president of U.S. networks distribution at ViacomCBS, said in a news release.
ViacomCBS is also re-branding its CBS All Access service into Paramount+. Backed by ViacomCBS’ content library, the service is set to compete with
(NFLX), Disney+, and
s (T) HBO Max. The merger between Viacom and CBS closed in late 2019.
KeyBanc Capital Markets analyst Brandon Nispel wrote in a note on Monday that the deal seems to resemble ViacomCBS’ agreement with Google’s parent
(GOOGL) for more of its networks on YouTube TV.
Nispel sees it as a positive development, noting it expands the distribution of Viacom’s content. The Hulu service has about 4.1 million subscribers, compared to YouTube TV’s roughly 3 million. Assuming a $3.78 per subscriber per month for the additional networks, Nispel estimates the Hulu deal would add about $186 million in additional annual revenue in 2021.
Nispel does note that eventually someone will have to pay for the added content. That someone will likely be consumers, he notes. Last summer, Alphabet’s YouTube TV hiked its price to $64.99 a month from $49.99 a month, around the time ViacomCBS’ 14 other networks joined the service.
ViacomCBS stock fell 1.8% to $36.60 on Monday, while the broader S&P 500 index was down 1.5%.
Write to Connor Smith at firstname.lastname@example.org