Netflix revolutionised the way we watch series and movies. They were one of the first companies to offer us streaming services and there is probably no human being on the planet that did not hear about them. However, as with any other sector or company, it was just a question of time when competition will come to the market. And so it was, today some of their competitors are Warner Bros., Disney, and Amazon. But there is another company joining the party, Paramount and their Paramount+ streaming service.

Showtime will be combined with Paramount+

Paramount Global is taking steps to unite its cable TV and streaming businesses by combining Showtime TV network and its streaming service, into one entity: Paramount+, which is its response to the current streaming wars. The TV network, which is known for popular shows like Yellowjackets, Billions, and Dexter, will now feature content from Paramount+ as well. Subscribers will be able to subscribe to Showtime for an additional fee on their existing pay-tv bundle. Currently, Paramount+ is priced at 4.99 USD per month, while Showtime's streaming service is offered for 10.99 USD per month. A bundle of both services is available for 11.99 USD per month. Paramount reported in November that Paramount+ had 46 million customers.[1]

Competition between streaming giants

The move to combine the two services is in response to the intense competition in the media industry as companies strive to make their streaming businesses profitable. The COVID-19 pandemic led to a surge in demand for streaming services, and the resulting competition has made it increasingly difficult to add new subscribers. This has impacted stock prices, leading media companies to experiment with various strategies to grow their streaming businesses. For example, last year, Netflix introduced a cheaper, ad-supported tier. Disney, which was early to bundle its streaming options, increased its prices and added an ad-supported option. Meanwhile, Warner Bros. Discovery has been cutting back on content for its HBO Max service as it looks to reduce costs. The company is also planning to launch a combined HBO Max and Discovery streaming app in the spring.[2]

Despite all of them being rather big companies, Netflix at the time of writing still takes the first place based on subscribers. The list goes as follows:[3]

1. Netflix – 223+ million subscribers

2. Amazon Prime – estimated 200 million subscribers

3. Disney+ - 164+ million subscribers

…

6. HBO Max – estimated 80 million subscribers

…

8. Paramount+ - estimated 46 million subscribers

9. Apple - 40 million subscribers

Stock development of Paramount Global and Netflix

Paramount Global stocks entered the market at 9,59 USD in 1990. Since then, they have seen nice development. The highest point they have reached was in March 2021, when the price for one stock was 94,94 USD.* After that it has been a free fall but stopped at current price of 22,61 USD at the time of writing.[4] This means that there is a lot of space for possible movement and growth, especially if Showtime and Paramount+ news will have positive reaction from investors.

Movement of Paramount Global stocks in the last five years. (Source: Google Finance) *

Netflix came to the market much later than Paramount, in 2002, with the price of 1,21 USD per stock. It has also seen a very nice growth over time, with reaching the all-time high price in October 2021, when the price was 690,31 USD.* Since then, similar as Paramount, the price of a stock suffered a big correction. At the time of writing, the price for a Netflix stock is 353,11 USD. [5]

Movement of Netflix stocks in the last five years. (Source: Google Finance) *

Conclusion

If we compare the subscribers’ numbers and stocks prices between Paramount and Netflix, we can see that the second one is far ahead, which is understandable, as it was the first and it is the biggest streaming platform. On the other hand, Paramount can offer interesting series and movies, for every generation. If they will play the game correctly and well, they have a good chance to at least come closer to Netflix, if not even beat them one day. And since the company made it to Austria and Germany only last year, it shows that they have a wish for global expansion[6], which means that we should not write them off just yet.

Adam Austera, analyst of Ozios

* Past performance is no guarantee of future results.

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[1] https://www.investing.com/news/stock-market-news/paramount-to-integrate-showtime-with-paramount-2991601

[2] https://www.cnbc.com/2023/01/30/showtime-paramount-plus-merge-new-name.html

[3]https://flixpatrol.com/streaming-services/subscribers/

[4] https://www.google.com/finance/quote/PARA:NASDAQ

[5]https://www.google.com/finance/quote/NFLX:NASDAQ

[6] https://finance.yahoo.com/news/paramount-arrives-germany-austria-switzerland-080000388.html