Paramount Global (NASDAQ:PARA) Bank of America Media, Communications & Entertainment Conference 2022 September 7, 2022 11:50 AM ET
Company Participants
Brian Robbins – President and Chief Executive Officer of Paramount Pictures and Nickelodeon, and Chief Content Officer, Movies and Kids & Family
Conference Call Participants
Jessica Reif Ehrlich – BofA Securities
Jessica Reif Ehrlich
Hi. Well, this maybe the first time I’m actually on time. So thank you so much for joining us, Brian. It’s great to see you, and you’ve had an amazing summer as we just discussed, becoming a massive success. So let’s just start with the industry. The industry has undergone a massive transition during COVID. What changes do you think are permanent? And what’s temporary? And how do you — what will you do that’s different because coming out of COVID?
Brian Robbins
Sure, well, obviously COVID had a huge impact on the theatrical business. It was basically shuttered, but it also accelerated streaming. And for us, it was a good reset because it sort of made – pushed us towards where we are now which is what we think is the right window and the 45-day window seems to be the sweet spot for us and seems to be what’s working.
But on the other hand, we know that we are still going to be flexible so with a movie like Top Gun, it’s still on theaters, Memorial Day and Labor Day.
Jessica Reif Ehrlich
Right
Brian Robbins
Because just people are still going and that movie will come to streaming this year. But we are having incredible run not only theatrically, but digitally now. But it’s an amazing experience and we’ve known that one that all boats rise with marketing. So the example on Top Gun, we are planning out, we dropped the movie digitally a new marketing campaign which not only made the home entertainment window – window. And then now play out and then eventually that movie went up on Paramount+ to theater.
Jessica Reif Ehrlich
Do you think that theatrical windows still fits the value for movies?
Brian Robbins
Absolutely, Jessica, I mean, look, there is nothing that replaces that Zeitgeist cultural moment and then a big movie. Again, we see that with Top Gun that we have seen it with other movies. I can’t think of anything on television or streaming that compares to that. And it probably has to do with the weight of the marketing campaign, right? The money that’s spent, the awareness, the interest that builds in a theatrical movie and then the collective experience that you have when you watch a film, right? That doesn’t happen at home.
Jessica Reif Ehrlich
Right.
Brian Robbins
So that value then translates for us to all our other platforms, right? And we use to only judge by the traditional waterfall, right? We go theatrical, home entertainment, free TV, et cetera. Now we have this thing called Paramount+ which has yet another value for us. So, the bigger the hit in theaters, the greater they impact in streaming.
Jessica Reif Ehrlich
Right. So it’s been basically a year since you took over as CEO and Chairman of Paramount Studios. How are you approaching the developments? Obviously, what changes if any should we expect going forward?
Brian Robbins
Well, we want to make the hits, only the hits.
Jessica Reif Ehrlich
That’s it. Wow.
Brian Robbins
But a lot of it has to do with what I just said, for years, we would go into green-light meetings and we look at their traditional waterfall. Now I go into green-light meetings and the first thing I think about is, can we creatively execute, right? Do we have the right filmmakers, the right material? Is this is the idea in a white space that we could own? And then lastly, what could the impact of this film have on streaming for us and what value does that have? And the beauty of the service of having something like Paramount+ is now we have all this data that we get in real time and wherever you look at that data and you’ll hey, this genre is working, this cohort wants more of x and we want to give the audience what they want.
Jessica Reif Ehrlich
That’s incredible feedback. But nobody had before really.
Brian Robbins
No.
Jessica Reif Ehrlich
It’s amazing. But you had – you start off like you had incredible success in the past twelve months and obviously Maverick has – what just, it hit it out of the box, I mean, right, it’s breaking all records. So, but, it feels like we are in this cycle of what big budget, gone on IP kind of ship heroes action, maybe – support them a little bit, but the rest of the movies just seem to be broking that well right now in theaters. Is this the new normal? Or is it just a phase, like what do you think is really, is it just genre-specific?
Brian Robbins
I am not sure I agree with that, quite frankly. And then I could only say that because of audience, right? So, obviously, Top Gun is the biggest film in the history of a hundred year studio. Paramount did have the biggest year we’ve had by market share in, I can’t count that high, but in a long time, but we’ve had four other number one films besides Top Gun open this year, right?
We’ve had Jackass, which is a comedy, Scream, which is a horror film to your point, Sonic, which was a four-quadrant family movie and a Rom-Com, starring Sandra Bullock and Channing Tatum, The Lost City, which – and worldwide.
So we were able to make every genre work. So I don’t think that every – and by the way, we didn’t have a movie where anybody wore tights, a cap or had super powers. So, I believe that if we execute, we find the right release dates and we have the right stars, we could make any genre work, because audiences want to go to the movies.
I mean, Lost City we got older females who people thought were never coming back to the theaters to come.
Jessica Reif Ehrlich
So, you are kind of known for, like being a franchise guy, like really supporting franchises. Are there any franchises within the Paramount umbrella that you think are underappreciated or haven’t been actively mined yet?
Brian Robbins
Well, look, I think at Paramount we are really fortunate to have an abundance of great franchises and I think in the past, people use to think about franchises, maybe a hit movie that had a consumer products line or a TV show that you’d have a spin-off of, but today I think you have to look at a franchise very differently. Franchises sort of create what I call like the strongest emotional bond anybody could have and that’s loved, right and with love comes loyalty. And the way I think – enterprise franchise is first by recognition and awareness, right. It’s going to be known. And second, you have to have rich characters and lots of avenues to tell great stories. It has to have global awareness, right. It can’t just be a domestic name. It has to play all over the world and then you have to have revenue and OI that scales with that business which means, you have to have a consumer products line and you have to sell toothpaste with the genres and ride at theme parks. So for us, things like SpongeBob, check that box, Teenage Mutant Ninja Turtles, check that box, Mission Impossible, checks that box, Transformers, checks that box and maybe one of the littlest but most powerful franchises we have is Paw Patrol where we’ll have another sequel next year.
Jessica Reif Ehrlich
So, how deep is the Paramount franchise library? How deep does it go and are there other ways you can monetize with your franchises?
Brian Robbins
Well, I just named five and there are probably at least five more, right. And I don’t think many…
Jessica Reif Ehrlich
Sorry.
Brian Robbins
It’s okay. I don’t think there is many studios that have the breadth and the depth of these franchises and what we’ve been able to do with Top Gun or Paw Patrol as an example is, we’ve been able to leverage our whole ecosystem to make these things into franchises and make them successful over the last couple of years. So, when you look at Top Gun and you think about how we took the campaign off last year opening the AFC Championship, which is the second highest football game of the year with a two minute Tom Cruise opening with Top Gun or with Scream last year where all of our cable networks took all the previous Scream movies and roadblocked them across all the cable networks for two weeks before that movie came out and all the shoulder content with that or what Nickelodeon was able to do make Paw Patrol flag. This is valuable in such a almost intangible way and there is not a lot of other companies that have that. So, that’s what I’ve been very focused on and I think that’s had a lot to do with our success over the last few years.
Jessica Reif Ehrlich
Right. Another area that you are very involved or – you going to be very involved into – what is the kids family area and…
Brian Robbins
Jess, do you have kids?
Jessica Reif Ehrlich
Yes. But there is a wealth of IP with the Paramount Global Company and kids will be – have mix – but have a mix success at the box office at least in the last year or so, you explored that, but they typically do better on streaming services, just like, how do you navigate kids and family for streaming versus Paramount versus like the theatrical output?
Brian Robbins
Sure, well, you are right. I mean, I got it great before Paramount to running Nickelodeon and I still have my day job or my night job whichever or however you want to call it, but we are very fortunate to have that asset in the company and all the IP that goes along with Nickelodeon, some of which I just mentioned. And we know that when it comes to streaming parents will go without eating, before like disconnecting something that entertains their kids, right. So kids’ content is an amazing, amazing retention tool for us. And a franchise like Paw Patrol is just like gold, right. So you have the movie. The movies theatrically does well. The movie goes to streaming. It brings all those kids with them and then we are fortunate enough to have this huge kids library including all the Paw Patrol titles to see them. So, a movie like Sonic, obviously is a hit at the box office, huge hit on streaming. But even a movie like Clifford the Big Red Dog that we released during the pandemic which did fine, not crazy theatrically. We were still in the pandemic was a huge, huge hit for us on streaming, huge acquisition tool, huge retention tool and in fact, we are developing the Clifford sequel now, where in the past if you would have just went by the box office results of that movie, probably won’t be doing, but because the impact that it’s had on streaming and the ROI from that we’ll make another one.
Jessica Reif Ehrlich
That’s a really great example of how you can do other things. Are there other ways to monetize that kind of content besides the theatrical and streaming does consumer products, TV shows?
Brian Robbins
Consumer products is a big, big, big business for us. And again, Paw Patrol is a greatest example because, last year we had the movie. We had the show. So the movie did surprisingly well at the box office even though when day and day did $140 million worldwide in the height of the pandemic mandate. Still it was by far the number one acquisition tool at the time for us in streaming. The whole library of Paw Patrol listed on Paramount+ and then Paw Patrol on Nick Linear had its best year in the years. And so all those drives. So next year we’ll come with the Paw Patrol sequel and a spinoff series of Paw Patrol right around the same time. But the greatest impact for us as you just said was in consumer products where we had our best year in consumer products for franchises in multi-billion dollar franchise for us in consumer products. And the thing that it does is you don’t get the lift in a year in consumer products but that tale of what that movie does for that movie does for that franchise probably runs for another three to five years from that theater. So it’s a big deal.
Jessica Reif Ehrlich
Right. So, I guess, when you think of streaming services that are available today, each one sort of has a personality or a trait. You think of HBO, you think of really premium video content and, you think of Disney’s kind of iconic family brands, when you think about how impressive if these things would generally like how would you describe what Paramount+ stands for?
Brian Robbins
I would say it this way. You probably know that Walmart plus just chose us as their streaming partner, their first streaming partner and hopefully their last streaming partner. And I think the reason they did that is that we were very aligned with the Walmart brand. Everybody knows I think that there is a 120 – 140 customers pass through their doors every week and the reason they chose us is they really felt that our content, whether that’s Yellowstone or our NFL content or kids content really align with their consumer. So I’d like to think that the Paramount – Paramount+ content is really for everybody and sort of stand through for what that Walmart customer stands for.
Jessica Reif Ehrlich
Right. And then, could you talk a little bit about the partnership that you have with Walmart? So, assessments that are coming up was in million members in the Walmart club, but how exactly does that partnership works?
Brian Robbins
I think if you are a Walmart – it’s pretty easier, you are a Walmart Plus customer, you get a notification. You click on it and you could sign up for Paramount+ for free and it could be less friction. It’s very, very easy. And I believe that the partnership is going to be really robust. I think they are in the early days of Walmart Plus and the combination that I know of the marketing campaign, it’s about to kick in from them and from us. I think you are going to see growth for Walmart Plus in a big way as they lean into scaling us that service for their customers and in turn we are going to benefit from it and hopefully we are going to not only drive consumers to Walmart Plus, but we are going to drive traffic in stores with things like our Teenage Mutant Ninja Turtle movie next year and Paw Patrol and Yellowstone and et cetera.
Jessica Reif Ehrlich
When does the marketing campaign kick off?
Brian Robbins
Soon, in a couple weeks or next week I think, yeah. It’s September already, right?
Jessica Reif Ehrlich
Yeah.
Brian Robbins
In a couple of weeks, yeah, next week.
Jessica Reif Ehrlich
Three to four occurrences. So, with the proliferation of streaming services along the – consumers have as you guys say, a mountain of content to choose from and you’ve formed well, I mean, your subscriber growth has been great on Paramount+. Can you talk about like the marketing? You talked a little bit about – you touched on it, but what’s differentiated to attract viewers or consumers? What are the accounts like the real differentiator between Paramount+ and some of the other streaming companies?
Brian Robbins
Sure.
Jessica Reif Ehrlich
Or services.
Brian Robbins
Well, I think we obviously have a very differentiated service, right? First of all we have live sports and obviously Netflix, HBO, it’s not there for them. We have, like we talked about a very, very robust kids content selection and we’ve been able to leverage our other distribution platforms to drive people to Paramount+, so Yellowstone is a great example, right?
Yellowstone is number one show on television. It’s on the Paramount network, 1883 went straight to Paramount+ but we were able to premier that show on Linear for free for people to see it and then drive them to 1883. Now, we’ll continue to do that with the next spinoff that comes to the Sheraton universe. Same thing for SpongeBob, we put the SpongeBob movie in the height of COVID, it was supposed to go theatrical.
We put that on Paramount+ at launch. And at the same time, we delivered the first ever spin-off of SpongeBob, Cam Carl to Paramount+ and the whole entire SpongeBob library. But we premiered that show on Linear. We ran a cart of Cam Carl during our telecast of the wildcard game last year, the Nickelodeon wildcard game and all of that drove audience to Paramount+.
And then there is this sort of great flywheel of sometimes in the SpongeBob universe a spin-off premier on Linear and then go to Paramount+, sometimes it will premiere on Paramount+ and then go to Linear. So we are constantly driving our audience from platform-to-platform.
And interestingly, like when it comes to kids, Linear television has obviously been declining ratings for a while now. But what we’ve seen is if you take our Linear share and the audience for kids that we’ve picked up on Paramount+, we actually have more audience and share of kids 2 to 11 than we’ve had in years when you combine them both. That’s powerful.
Jessica Reif Ehrlich
How much crossover is there? Like it’s – in terms of reach, but there are some homes…
Brian Robbins
You mean overlap?
Jessica Reif Ehrlich
Yeah.
Brian Robbins
Between Linear and surprisingly, it’s not as much as you think that’s what hence the share picking up.
Jessica Reif Ehrlich
All right. The incremental reach is incredible, like…
Brian Robbins
Yeah and it’s a great story, right? So we were in this declining reach for years and now it’s a growth story for us.
Jessica Reif Ehrlich
Right.
Brian Robbins
And that growth will drive all the other lines of business, right? It will drive consumer products. It will drive our theatrical business and it’s really been powerful and it’s been fast.
Jessica Reif Ehrlich
And what is the difference if any, between kids view – kids watch a lot and often. Like I think they can watch repeat stuff over and over. But what’s – is there any difference in viewing habits between Linear and streaming?
Brian Robbins
Well, look, I definitely think Linear for kids is a very lean back experience, right? I mean, Linear is kind of put it on and it’s on all day and you’re kind of watching it, but you’re probably on another device at the same time. This is my experience with my role.
Jessica Reif Ehrlich
Right.
Brian Robbins
We are streaming you’re more proactive, right? You’re going, you’re searching for the thing you want, you are watching it, how you want to watch it on whatever device you want to watch it, when you want to watch it. So I think just the sort of search function and the need and the want is different.
Jessica Reif Ehrlich
And are there differences for kids programming in air loads, not little tiny kids, but just like your 8-year-old are there differences air loads?
Brian Robbins
You mean on Linear…
Jessica Reif Ehrlich
Linear versus streaming.
Brian Robbins
Well. Sure. The – streaming is later.
Jessica Reif Ehrlich
Can you make it up? But is there a way you can compare like how…
Brian Robbins
You mean from a revenue?
Jessica Reif Ehrlich
From a revenue perspective.
Brian Robbins
Well, it’s like, look, the streaming revenue is growing, right? It’s early days and I would imagine as like I just said, the reach can use to scale on streaming. So will the revenue go with it and by the way, there is multiple paths and monetization with streaming, right? You have the ad-supported tier and then the non-ad tier. And then we also have Pluto, which is free, that also has a ton of our kids’ content on it, which is obviously ad support.
Jessica Reif Ehrlich
All right. And then just the internationally, as you guys are expanding and you are now in I mean, the – well, it’s, I guess Sky Showtime, but then parent pluses, right, do you have…
Brian Robbins
Italy is coming soon, U.K., Latin America, yeah.
Jessica Reif Ehrlich
So can you talk about the content decision-making? And how do you – how do you – do you pick shows to offer like global appeal? Or do you have different shows in different countries? How do you think about that?
Brian Robbins
I think it’s both. I think you have to do it right. I mean, we are very focused trying to make global hits. Now the kids content, much easier, travels globally, it has worked that way for years, the Nick content very successful around the globe.
Scripted content, you’re still trying to make global hits, but there are certain shows that are going to perform better here than and then won’t perform as well overseas or Show like Halo, which did very well here but blew away all expectations internationally. So we’re focused on making global hits, but we also then have to be very selective about the local content in each market because it’s not enough just to send our content one way. There is an expectation in all these markets that there will be some local flare.
Jessica Reif Ehrlich
Right. Coming back to the box office, it’s been such an unusual like last few years. So I’m just wondering how to is it at least. It’s more change in the last two years than the last like 30. But how do you — how do you think about the next five to ten years? Do you think the box office will be the same, bigger or lower? Like for films…
Brian Robbins
It’s funny. I – obviously, everybody has predicted the theatrical for probably as long as you’ve been doing this, right? How many times have you set up here and said theatrical is over, the television came, DVDs came, right?
Jessica Reif Ehrlich
I mean, I lived through broadcast cable and broadcast is alive and well.
Brian Robbins
But as this summer has showed, people still want that the absolute experience they want to sit in a theater and they want to be moved and they want to do it in a communal way. So, I think that theatrical is here to stay. I actually, I’m not going to say that it’s going to be a growth business. I think franchises matter. I think quality matters. I think that you will see more films.
I mean, right now, we’re in this weird post-COVID, movies got shut down, development got shut down, things were slow. I know from where we stand we’ll only have, I think eight releases this year in total. Next year, we’ll have 10 to 12, but we know because of the impact on streaming, we want to get that up. I’d like to get 12 to 15 because the path to monetization now is greater and we still have to be careful about how we size these movies, but I am very bullish on the future.
Jessica Reif Ehrlich
Right. I mean that’s a pretty big increase. How long do you think it takes to get to that kind of…
Brian Robbins
It takes us a couple of years, at least. We have to ramp up development and look, there is only so much talent in the world, right? There is only so many movie stars. There is only so many filmmakers. There is only so many great scripts. So it takes a while. What’s interesting is the streaming effect, everybody talks about how people are taking their theatrical films and moving to streaming.
What we’re experiencing is because we’re making a handful of films for streaming directly, but I still take these movies and test them because I want to see how they are playing. We do the same process. We have a movie coming out on September 30 called Smile. It’s a thriller horror film. This is a movie, it was a little movie with the first-time director that we made for streaming.
We tested the movie. The movie scored so well, I mean crazy well and played so well that we looked at each other and said, we have to release this movie theatrically. And so, that’s just another great side effect of having a streaming service and this is, I’m sure, is going to happen from time to time and it’s great and fun.
Jessica Reif Ehrlich
And coming out of COVID, like what are the COVID incremental cost impacts? Do you still have all the protocols in place?
Brian Robbins
Some of them, it’s easing up a little bit, thank goodness. I mean, we’re not experiencing the shutdowns. The shutdowns were the most expensive part of the cost, right, where you were shutting down for days, shutting down for days, having to restart, losing locations, losing actors. Thank goodness over the last several weeks and months that has slowed down. They’re still testing in place from the unions, but the shutdowns are few and far between.
Jessica Reif Ehrlich
And with the growth in streaming, like during this COVID period, I mean, it’s like a lots going on. So with the growth in streaming, you are competing for talent, you mentioned talent is limited, but you are competing for talent even theatrical stars who are now going to streaming projects. So what’s going on with that pool of talent, I guess, the demand for talent, how hard is it to get and what’s going on in the cost side?
Brian Robbins
Well, the tide has shifted again, right? If you had asked me this question two years ago, I would say talent is running towards streaming because they want these enormous checks, right? They were getting their back ends bought out, and it was tricky. What’s turned around now, I think our stars are realizing that they obviously to be stars and command those pay days, they need to be relevant and they were not getting the marketing campaigns from streaming services.
You look at a marketing campaign like Top Gun or Lost City where you drive all over town and you see billboards or you walk into a theater and you see one sheet for the poster and trailers and TV spots, this is really valuable to stars, and they’re realizing they want that. They need that for their brand. They are brands. They need marketing. So it shifted back in our favor a little bit. So we’re in business with and Ryan Reynolds and Tom Cruise and big stars that want to be – have their movies seen on the big screen.
Jessica Reif Ehrlich
Right. So when you kind of like – this an extra window streaming, but when you kind of like think about it – the theatrical always set the tone and then you kind of knew what the downstream value was with streaming, it may be as outside, it’s a little harder to – for us to – if we don’t see your gross adds based on a film.
Brian Robbins
So, I can tell you, we’ve had the fastest-growing streaming service of the year and we have the most additions in most apps.
Jessica Reif Ehrlich
Yes. No, it’s been really – I have to say it’s been really impressive, and you still have massive international rollout to go.
Brian Robbins
Enormous runway. Yes.
Jessica Reif Ehrlich
So, do you think – on the film side is if it all more or less valuable today than it was five years ago.
Brian Robbins
Way more, way more because, look, not everybody has their own service, right? But when Top Gun comes to Paramount+ this year, think about that impact. Think about what that’s going to do to us as a company. It’s already been so successful for us, but yet we get this another added benefit. That’s a big deal.
Jessica Reif Ehrlich
Absolutely, but when you kind of balance it against like what the home entertainment would have been like the home video market would have been for Top Gun. That, that…
Brian Robbins
No, no, it is. But remember, we’re not foregoing that window. It’s on home entertainment right now, and it will go to physical before then. And I hope I don’t mess this up. But I think in one week, in the first week, it’s already the biggest home entertainment video we’ve ever had and it’s broken the top 20 of all time in the first week. So we will enjoy all that revenue. Our partners will enjoy all that revenue.
And we’ll still get the impact on streaming. And that’s what we’re seeing. All boats rise. Everybody thought there was going to be – they were going to sort of steal from each other, but indeed, that hasn’t happened.
Jessica Reif Ehrlich
Right. So let me just say one last question, but I want to see if anybody in the audience has any questions for a second, see if there is any question. Okay, you guys can think about it if you want to add something. Just last question from me is what upcoming Paramount content are you the most excited about and I’ll expand that to film as you think.
Brian Robbins
That’s a tough question because I’m going to be in trouble going to hurt somebody’s feelings, but I’ll tell you the truth. We have an amazing theatrical slate next year. We go first of all, Damon Chazelle’s Babylon, which if you look at vanity fair today, there’s a sneak peak of all the photos of this movie starring Brad Pitt and Margot Robbie and Damien Chazelle, Academy award winner for La La Land, directed Whiplash.
The film is incredible. We’re unveiling a trailer soon. And then we go to Dungeons & Dragons and Transformers, Mission Impossible; Teenage Mutant Ninja Turtles, PAW Patrol, Scream. So we have an incredible slate to your point of franchises next year. But I’d be lying if I told you guys, you’re going to just your mind will be blown when you see Mission Impossible.
Jessica Reif Ehrlich
Everyone says.
Brian Robbins
Your mind is going to be blown. Yes. So that movie is next July. And I just I can’t wait. I can’t wait. I wish you could see what I’ve seen.
Jessica Reif Ehrlich
No, the word of mouth is absolutely incredible. And then on the – if you expand it to the television side, is there anything that you’d kind of call out at this point?
Brian Robbins
Well, the next chapter in the Elliston universe with Harrison Ford and Helen Miron, I think it’s 1823 or 1923, I think you’re right, that show is going to be fantastic. I don’t know if you’ve seen Star Trek, Strange New Worlds, the show is really, really terrific and maybe the best one in that franchise that just dropped. We have a tremendous kid slate coming next year and if you have a little one, there’s a Paw Patrol then that you’ll be happy about or they’ll be happy about you might be miserable about. But…
Jessica Reif Ehrlich
Okay. Audience, any questions? Just one here.
Question-And-Answer Session
A – Brian Robbins
I can hear you. Business as usual of what we’re – what we need to do to open a movie, we’re going to continue to do that. We do leverage all of our platforms, right? So a lot of our spend is internal, which is great and my colleagues like that. So it’s nothing different for us.
Now I know there is headwinds in the advertising coming into us, but that’s different than what we’re spending out it on marketing. I think it’s challenged. I think there is definitely headwinds for sure, as we’ve all heard in the second half of this year and probably into the beginning of next year.
Unidentified Analyst
As you think about just your long-term goal strategically and you just look at your current scale, do you feel like you have all the scale and the resources currently to achieve your long-term strategic goals? Or do you think about either now or in the future acquisition opportunities would be a better fit to help you get to the scale for you to achieve your long-term goals?
Brian Robbins
I think we like – we like our chances and we like where we are. Look, we are – from a streaming perspective, we’re growing faster than anybody. That’s exciting. From an IP perspective, we are in really great shape as you could tell by the films we have and the franchises we have on television and I think what differentiates us from the rest is all of our distribution platforms, right, to be able to have the number one broadcast network, the number one kids network, the fastest-growing streaming service, the biggest film studio by share for the year.
We are actually really working together in leveraging all these assets to grow. So yes, I mean, obviously, if something fell out of the sky and you’ve gotten more scale. I wouldn’t say no. But I feel like we are really in a great position to grow and to leverage everything we have. I can hear you.
It’s a tough – that’s kind of not – you’re above my pay grade. Like I said above my pay grade, right.
Jessica Reif Ehrlich
There is question here and another one there.
Unidentified Analyst
So maybe before we get to long term, just in the medium term, as you look at the different distribution channels, how are you balancing where you want the eyes to be, whether it’s profitability, like as you think about where you place the content, what’s kind of the guiding principle as we go quarter-to-quarter on where you move the films and TV shows?
Brian Robbins
Sure. Well, like I said, theatrical still has the greatest impact, right? And that that sort of theatrical 45 days later streaming that’s working beautifully, I mean if you were to see a chart of our biggest acquisition tools and engagement tools, the movies just really sit nicely. On the series front, obviously, the franchises, the franchise tact with Series is also working, the tele Sheraton universe, taking something like Star Trek and building a franchise out of it.
And even on the kids side, the SpongeBob universe and the PAW Patrol universe where you get something new and you have the library underneath it. So windowing from theatrical to streaming and then back to linear is really working for us, but we’re also having great success starting some things on Linear and then moving them to streaming.
And it sort of creates, I hate to use that word, but that flywheel really works for us. And I think it’s a big advantage for us. It’s a big advantage for us to launch something to be able to have linear or theatrical to launch a franchise.
Jessica Reif Ehrlich
There is another one here.
Unidentified Analyst
With respect to the Pluto platform, I know that it’s relatively nascent at this point. But hasn’t met your expectations in terms of growth so far? And then, also with Pluto, I know you’re selling advertising, are you packaging those ad sales with the network as well as Linear? How does the actual go-to-market.
Brian Robbins
I am going to say, that’s above my pay grade too answer.
Unidentified Analyst
Let me go to someone else.
Brian Robbins
Yes, let me just resigned that deal.
Unidentified Analyst
Yes. That’s fantastic. Can you talk a little bit about how those content costs have been rising to competitive dynamic with sports and how you think about that more longer term? And I think the second question, I can get to actors.
Brian Robbins
Okay. I only have three jobs. I don’t run sports.
Unidentified Analyst
Okay. Fantastic, okay. The second question is regarding franchises that you talked about. The monetization strategies, toys, you mentioned theme parks. Is that something you see yourself leaning into more in the future? And what…
Brian Robbins
Absolutely, like I said, consumers want more of the things they love, right? They want to see the movie watch the show, read the book, where the pajamas used to toothpaste, ride the ride, right? So we’re very focused on that. We want to be everywhere the consumer is with our franchise is because that’s what creates love and ultimately, long-term monetization.
So we’re very – our CP business is great, but we have a Nick hotel that we – a new Nick hotel that we just opened, we’ll be opening more around the world. We hope to have rides in theme parks everywhere and it’s definitely a big focus of the company.
End of Q&A
Jessica Reif Ehrlich
Great. With that, we actually are out of time. Thank you so much, Brian.
Brian Robbins
Thank you.
Jessica Reif Ehrlich
Thank you.
Brian Robbins
Thanks, guys.
Be the first to comment