CBS launches new digital subscription service

CBS launches new digital subscription service
CBS announced the launch of CBS All Access, a new digital subscription video on demand and Nielsen-measured live streaming service. (CBS)

CBS is going a la carte.

The network said beginning Thursday, it will offer a new digital subscription video on demand and streaming service for its television network called CBS All Access.


For $5.99 per month, the subscription service will allow users to live stream CBS-owned stations, watch full seasons of eight series -- including popular shows such as "The Good Wife" and "Survivor" -- and access exclusive additional content for CBS' special events like the Grammy Awards. The service is available on and on mobile devices through the CBS app for iOS and Android.

However, it will not include live streaming of the company's Thursday and Sunday NFL games because CBS does not own the rights.

Chief Executive Officer of CBS Corp. Leslie Moonves said in a statement that the service is "another key step" for the company.

"This new subscription service will deliver the most of CBS to our biggest fans while being additive to the overall ecosystem," he said. "Across the board, we continue to capitalize on technological advances that help consumers engage with our world-class programming, and we look forward to serving our viewers in this new and exciting way."

CBS has typically been conservative in how it offers its programming online. It has deals with Amazon, Netflix and Hulu Plus for library fare but has been protective of programs that are still on its network.

NBC, ABC and Fox all have an ownership interest in Hulu so they already have a digital outlet for their programming.

The news comes one day after HBO announced it will offer its programs directly to consumers over the Internet.

Some analysts believe new streaming services will improve monetization of content.

"On the heels of Time Warner/HBO announcement, we see the media players expanding their business models while positioning them for better growth in the coming years," Piper Jaffray & Co. analysts James Marsh and Stan Meyers said in a report.

In a report titled "Everybody's Doing It," analysts at Nomura Equity Research said the service provides "incremental value for true devotees" because they won't have to wait eight days after broadcast airing to see a show.

"Additionally, we believe costs associated with the rollout of the service will be fairly limited, due to the fact that CBS has the majority of the infrastructure already built out with its offering," analyst Anthony DiClemente wrote in the report.

Several analysts predict CBS-owned Showtime will likely be the next network to announce an "over-the-top offering."

Meanwhile, investors fear these streaming deals will add more competition for Netflix, which posted some tepid subscriber numbers in Wednesday's earnings report.

Shares for Netflix fell more than 25% in after-hours trading. As of Thursday morning, shares were down about 22%.


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