Paramount Plus to raise subscription rate as the network merges with Showtime

Well, it was fun while it lasted. At $4.99 (with commercials), Paramount Plus was one of the cheaper streaming services out there, and it has some really good content to boot (Tulsa being one of those). Now the dream is apparently over due to the fledgling streamer teaming up with Showtime.

The new service will be called ‘Paramount Plus with Showtime’ and cost $11.99 a month. The essential plan with commercials will go up to $5.99, which honestly is still pretty good considering the amount of content that comes along with it — the service recently added megahit Top Gun: Maverick to its roster.

The Hollywood Reporter sat in on a call with CEO Bob Bakish, who explained the new pricing structure.

“We all know streaming represents incredible value for consumers and the Paramount Plus offering is far from the industry price leader. We are on the value end of the pricing spectrum. And so in 2023, we will raise prices both for Paramount Plus Premium and Essential, both in the U.S. and select international markets,” Bakish said.

Both new and old customers will be affected by the price change. Paramount will also probably see an impairment charge of somewhere between $1.3 billion and $1.5 billion in the first quarter of this year, due to its partnership with Showtime and the content that comes along with it.

Paramount CFO Naveen Chopra said that Paramount will no longer “need the kind of content that you would need if they were operating on an independent basis.” The company said the move will result in about $700 million of savings annually. Bakish said that the company will also be paying more attention to franchises.

“By far our biggest lever to manage spending is to focus on franchises. The higher levels of consumer awareness and built in fan bases associated with this IP drive strong subscriber acquisition volume, lower acquisition costs, lower churn and extend LTVs,” Bakish said. “And while we will, of course continue to take selective swings on new IP, there’s no question that franchises are a powerful advantage.”

The new pricing will go into effect in the third quarter of 2023.