Paramount Global (PARA): Business Model Canvas [11-2024 Updated]

In the rapidly evolving landscape of media and entertainment, understanding the business model of a major player like Paramount Global (PARA) is crucial. This comprehensive analysis delves into its key partnerships, value propositions, and revenue streams, showcasing how the company navigates the challenges of content creation and distribution. Explore how Paramount Global leverages its extensive resources and innovative strategies to maintain a competitive edge in a crowded marketplace.

Paramount Global (PARA) - Business Model: Key Partnerships

Collaborations with streaming platforms

Paramount Global has established significant partnerships with various streaming platforms to enhance its content distribution. Paramount+ has become the cornerstone of its streaming strategy, generating $4.33 billion in revenue for the nine months ended September 30, 2024, a 40% increase from the previous year. This growth reflects a surge in subscribers, which rose to 71.9 million, a 13% increase year-over-year.

Licensing agreements with content creators

Paramount Global actively engages in licensing agreements, which are crucial for expanding its content library. For the nine months ended September 30, 2024, licensing revenues amounted to $10 million, up 150% from the previous year. These agreements allow Paramount to diversify its offerings and leverage third-party content effectively.

Partnerships with advertising agencies

Advertising partnerships play a vital role in Paramount's revenue model. Advertising revenues for the three months ended September 30, 2024, were reported at $1.66 billion, reflecting a 2% increase from the same period in 2023. The success of Paramount+ and Pluto TV has significantly contributed to this growth, alongside higher political advertising revenue.

Joint ventures in content production

Paramount Global is involved in several joint ventures to enhance its content production capabilities. A notable example is its partnership in SkyShowtime, which allows Paramount to share resources and expertise in creating and distributing content across international markets. This venture supports Paramount's strategy to penetrate global markets effectively.

Strategic alliances with international broadcasters

Strategic alliances with international broadcasters enable Paramount to expand its global footprint. As of September 30, 2024, unrecognized revenues under long-term contracts with international partners were approximately $7 billion, indicating the significant potential of these partnerships. These alliances are essential for distributing Paramount's content in various regions, thereby enhancing its global visibility and revenue streams.

Partnership Type	Description	Revenue Impact (2024)
Streaming Platforms	Partnerships primarily with Paramount+	$4.33 billion
Licensing Agreements	Content licensing to expand library	$10 million
Advertising Agencies	Partnerships for ad revenue generation	$1.66 billion
Joint Ventures	SkyShowtime for international content production	Not specified
International Broadcasters	Alliances for content distribution	$7 billion (unrecognized revenues)

Paramount Global (PARA) - Business Model: Key Activities

Content creation and production

Paramount Global continues to invest significantly in content creation, with content costs amounting to $10.54 billion for the nine months ended September 30, 2024, a decrease of 9% compared to $11.59 billion in the same period of 2023. This reduction reflects lower costs associated with theatrical releases and a shift in content strategy that involved the write-off of development costs and contract termination costs, totaling $2.37 billion in 2023.

Distribution of films and television shows

In the nine months ended September 30, 2024, Paramount Global reported total revenues of $21.23 billion, a 4% decline from $22.01 billion in 2023. This decline was driven by lower revenues from theatrical releases and licensing. Theatrical revenues specifically fell by $336 million, attributed to the timing and mix of releases.

Marketing and advertising efforts

Advertising revenues for the three months ended September 30, 2024, increased by 18% to $507 million, compared to $430 million in the same period of 2023. This growth was driven by higher impressions from Paramount+ and political advertising sales. For the nine months ended September 30, 2024, advertising revenues totaled $1.54 billion, an increase of 21% over the prior year.

Streaming service management

Paramount+ subscribers reached 71.9 million as of September 30, 2024, marking a 13% increase from 63.4 million a year earlier. The streaming service generated revenues of $4.33 billion for the nine months ended September 30, 2024, up from $3.09 billion in the same period of 2023. Adjusted OIBDA for the direct-to-consumer segment improved by 82%, reflecting revenue growth and lower marketing and content costs.

Rights acquisition for sports and entertainment

Paramount Global has secured rights to significant sports events, including the Super Bowl LVIII broadcast, which contributed positively to revenue. The rights acquisition strategy has led to a 2-percentage point benefit to total revenue from the Super Bowl broadcast. The company also reported a licensing revenue increase of 150% in the direct-to-consumer segment, reflecting its strategic content rights acquisitions.

Key Activity	Financial Impact (2024)	Comparison to 2023
Content Costs	$10.54 billion	Decrease of 9%
Theatrical Revenues	$399 million	Decrease of $336 million
Advertising Revenues	$1.54 billion	Increase of 21%
Paramount+ Subscribers	71.9 million	Increase of 13%
Streaming Revenues	$4.33 billion	Increase of 40%
Licensing Revenue	$10 million	Increase of 150%

Paramount Global (PARA) - Business Model: Key Resources

Extensive library of films and TV shows

Paramount Global maintains a vast library that includes over 3,600 films and 30,000 TV episodes. This extensive catalog is a significant asset, enabling the company to generate revenue through licensing, syndication, and streaming services.

Strong brand portfolio (e.g., CBS, Nickelodeon)

The company boasts a robust portfolio of well-known brands, including CBS, Nickelodeon, MTV, and Paramount Pictures. CBS alone generated approximately $5.98 billion in revenue for the nine months ending September 30, 2024.

Advanced streaming technology (Paramount+)

Paramount+ has become a key resource, with revenues reaching $4.33 billion for the nine months ending September 30, 2024, representing a 40% increase year-over-year. The platform supports over 71.9 million subscribers globally, up from 68.4 million in the previous quarter.

Skilled workforce in media production

Paramount Global employs a skilled workforce of approximately 25,000 employees across various divisions, including production, marketing, and technology. This talent is essential for creating high-quality content that attracts viewers and subscribers.

Financial capital for investments and acquisitions

As of September 30, 2024, Paramount Global reported total assets worth $46.25 billion and total liabilities of $29.16 billion. The company has a significant amount of financial capital available for strategic investments and acquisitions to enhance its content offerings and technology capabilities.

Key Resource	Description	Value/Impact
Film and TV Library	3,600 films and 30,000 TV episodes	Revenue generation through licensing and streaming
Brand Portfolio	Includes CBS, Nickelodeon, MTV, Paramount Pictures	$5.98 billion revenue for CBS (2024)
Streaming Technology	Paramount+ platform	$4.33 billion revenue; 71.9 million subscribers
Workforce	Approximately 25,000 employees	Essential for high-quality content production
Financial Capital	Total assets of $46.25 billion	Available for investments and acquisitions

Paramount Global (PARA) - Business Model: Value Propositions

High-quality, diverse content for audiences

Paramount Global offers a robust portfolio of high-quality content across various genres, catering to a wide spectrum of audience preferences. The company reported revenues of $21.23 billion for the nine months ending September 30, 2024, a decrease of 4% from the prior year, primarily attributed to lower theatrical and licensing revenues.

Unique programming including exclusive sports events

Paramount Global has secured exclusive broadcasting rights for significant sporting events, including the Super Bowl. This has contributed to a 21% increase in advertising revenues, totaling $5.98 billion for the nine months ended September 30, 2024. The company’s direct-to-consumer segment, particularly through Paramount+, generated $4.33 billion in revenues, a 40% increase year-over-year.

Competitive pricing for subscription services

Paramount+ has adopted a competitive pricing strategy, driving a 13% increase in subscription revenues, amounting to $4.07 billion for the nine months ended September 30, 2024. This growth is also influenced by a pricing increase in June 2023.

Multi-platform access (TV, streaming, mobile)

Paramount Global provides seamless access across multiple platforms, including television, streaming services, and mobile devices. As of September 30, 2024, Paramount+ reached 71.9 million subscribers, reflecting an increase of 8.5 million or 13% compared to the previous year. This multi-platform approach enhances user engagement and accessibility.

Strong legacy and brand recognition in entertainment

Paramount Global's legacy as a leading entertainment provider is bolstered by its historical brand recognition. The company operates under well-known franchises and has a rich catalog of content that continues to attract audiences globally. The brand's equity is reflected in its ability to generate substantial revenues, with total revenues of $6.73 billion for the third quarter of 2024.

Value Proposition	Details	Financial Impact
High-quality, diverse content	Wide range of genres and programming	Revenues of $21.23 billion (2024)
Exclusive sports programming	Rights for major sporting events	Advertising revenues increased by 21% to $5.98 billion
Competitive pricing	Affordable subscription models	Subscription revenues of $4.07 billion (13% increase)
Multi-platform access	Available on TV, streaming, and mobile	Paramount+ subscribers reached 71.9 million
Strong brand recognition	Historic presence in entertainment	Total revenues of $6.73 billion (Q3 2024)

Paramount Global (PARA) - Business Model: Customer Relationships

Direct engagement via streaming platforms

Paramount Global's direct engagement with customers primarily occurs through its streaming service, Paramount+. As of September 30, 2024, Paramount+ had approximately 71.9 million global subscribers, reflecting an increase of 8.5 million or 13% compared to the previous year . The service has benefited from international expansion and the migration of subscribers from Showtime's premium service . The revenue generated from Paramount+ for the nine months ended September 30, 2024, reached $4.332 billion, a 40% increase year-over-year .

Customer support for subscribers

Paramount Global invests in customer support to enhance the subscriber experience. As of 2024, they have focused on improving customer service operations, which is reflected in their subscriber engagement metrics and retention rates. Although specific customer support statistics were not disclosed, the company emphasizes enhancing user experience as a priority to reduce churn rates and maintain subscriber growth .

Loyalty programs and promotions

Paramount Global has implemented various loyalty programs and promotional activities to retain subscribers. These include promotional offers for new subscribers and bundled services with other platforms. The company has seen a 7% increase in subscription revenues, driven by pricing adjustments and promotional strategies initiated in mid-2023 . Specific details on loyalty program participation rates or financial impacts were not disclosed but are integral to their customer retention strategy.

Feedback mechanisms for content preferences

Paramount Global actively solicits feedback from its subscribers to tailor content offerings. This feedback is gathered through in-app surveys and viewer analytics, which inform content development and programming decisions. Enhanced data analytics capabilities allow the company to track viewer preferences, resulting in more personalized content recommendations, thus improving viewer satisfaction and engagement .

Social media interaction and community building

Paramount Global maintains a strong social media presence to engage with its audience and build community. The company utilizes various platforms, including Twitter, Instagram, and Facebook, to interact with fans, promote new content, and gather viewer feedback. Advertising revenues from social media campaigns have increased, reflecting the effectiveness of their community engagement strategies. For the nine months ended September 30, 2024, advertising revenues grew by 21% to $1.540 billion, aided by social media promotions .

Metric	Value (2024)	Change (%)
Global Paramount+ Subscribers	71.9 million	+13%
Paramount+ Revenue	$4.332 billion	+40%
Advertising Revenue	$1.540 billion	+21%
Subscription Revenue Growth	$4.069 billion	+13%

Paramount Global (PARA) - Business Model: Channels

Paramount+ streaming service

As of September 30, 2024, Paramount+ reported revenues of $4.332 billion, marking a 40% increase compared to $3.093 billion in the same period in 2023. The service had 71.9 million subscribers, up from 63.4 million year-over-year, reflecting a growth of 13% .

Advertising revenues for Paramount+ grew by 21%, driven by increased impressions and contributions from events like Super Bowl LVIII .

Cable and satellite television networks

Revenues from cable networks decreased by 7%, totaling $13.800 billion for the nine months ended September 30, 2024, compared to $14.917 billion in the prior year . The decline was attributed to reductions in linear subscriber counts and lower advertising revenues in traditional cable .

Affiliate and subscription revenues from cable networks decreased 5% to $5.778 billion .

Theatrical releases for films

Theatrical revenues for Paramount Global saw a significant decline, reporting $399 million for the nine months ended September 30, 2024, down 46% from $735 million in 2023 . This drop was largely due to the fewer number of major releases compared to the previous year .

For the third quarter of 2024, theatrical revenues were $108 million, a 71% decrease from $377 million in the same quarter of 2023 .

Digital distribution platforms

Paramount Global's revenues from digital distribution platforms, including transactional video-on-demand and electronic sell-through services, were impacted by lower licensing revenues. Total revenues from these digital platforms were reported at $1.465 billion, a decrease of 6% compared to $1.554 billion in the previous year .

Retail partnerships for physical media sales

Retail revenues from physical media sales, including DVDs and Blu-ray discs, have seen a consistent decline. The revenues in this segment were approximately $3.462 billion for the nine months ended September 30, 2024, representing a 22% decrease from $4.424 billion in the same period last year .

Licensing revenues also decreased significantly, reflecting a lower volume of licensing agreements in the secondary market .

Channel	2024 Revenues (in billions)	2023 Revenues (in billions)	Growth/Decline (%)
Paramount+ Streaming Service	$4.332	$3.093	40%
Cable Networks	$13.800	$14.917	-7%
Theatrical Releases	$0.399	$0.735	-46%
Digital Distribution	$1.465	$1.554	-6%
Retail Partnerships	$3.462	$4.424	-22%

Paramount Global (PARA) - Business Model: Customer Segments

General audiences for entertainment content

Paramount Global targets a broad audience with diverse entertainment offerings across various platforms, including traditional television, film, and digital streaming. As of September 30, 2024, Paramount+ has reached approximately 71.9 million subscribers, a significant increase from 63.4 million in the same period in 2023 .

Families seeking diverse programming

The company focuses on family-friendly content, which is a significant driver for its streaming service, Paramount+. The programming includes movies, series, and educational content suitable for all ages. The revenues from Paramount+ for the nine months ended September 30, 2024, were $4.33 billion, representing a 40% increase compared to the same period in 2023 .

Sports fans for live broadcasting

Paramount Global has invested heavily in sports broadcasting, leveraging its CBS network to attract sports enthusiasts. The broadcast of Super Bowl LVIII alone contributed a 2 percentage point increase to total revenue. The company generates substantial advertising revenue from sports events, which was $5.98 billion for the nine months ended September 30, 2024 .

International viewers through localized content

To capture international markets, Paramount Global has developed localized content tailored to regional preferences. This strategy has helped grow its international subscriber base. The Paramount+ international revenues increased significantly, contributing to the overall growth of $1.24 billion in subscription revenues for the nine months ended September 30, 2024 .

Subscribers to premium streaming services

Paramount Global offers premium subscriptions through Paramount+, which has seen a 13% growth in subscriber numbers year-over-year . The subscription revenue for the streaming segment was $1.34 billion for the three months ended September 30, 2024, reflecting a 7% increase compared to the previous year .

Customer Segment	Key Metrics	Revenue Contribution (2024)
General audiences	Subscribers: 71.9 million	Not specified
Families	Revenue: $4.33 billion	40% increase YoY
Sports fans	Super Bowl LVIII impact: 2% revenue increase	$5.98 billion in advertising
International viewers	Localized content initiatives	$1.24 billion in subscription revenue
Premium streaming subscribers	Growth: 13%	$1.34 billion in subscription revenue

Paramount Global (PARA) - Business Model: Cost Structure

Content production and acquisition costs

For the nine months ended September 30, 2024, Paramount Global incurred content costs of $10.54 billion, representing 77% of total operating expenses. This figure reflects a decrease of $1.05 billion compared to $11.59 billion for the same period in 2023, indicating a 9% reduction in content-related expenditures.

Marketing and advertising expenditures

Marketing costs for the nine months ended September 30, 2024, totaled $1.53 billion, which is down from $1.74 billion in the prior year. This represents a decrease of 12% year-over-year. Advertising revenues increased by 21%, driven primarily by growth in impressions from streaming services like Paramount+ and Pluto TV.

Operational costs for streaming services

Operational costs for streaming services, including Paramount+, contributed to the overall cost structure significantly. For the nine months ended September 30, 2024, streaming services generated $4.33 billion in revenues, up 40% from $3.09 billion in the previous year. This growth was partially offset by increased operational costs associated with content and technology investments.

Salaries and benefits for employees

Salaries and benefits for employees amounted to approximately $4.77 billion for the nine months ended September 30, 2024, down from $5.27 billion in the same period of 2023, reflecting a decrease of 10%. This reduction in employee costs is likely attributed to workforce restructuring efforts undertaken by the company.

Technology infrastructure and maintenance

Investment in technology infrastructure and maintenance costs for the streaming platforms and other services was part of the operational expenditure. Although specific figures for technology costs were not disclosed, overall capital expenditures, which include technology investments, were reported at $151 million for the nine months ended September 30, 2024.

Cost Category	Q3 2024 Amount (in billions)	Q3 2023 Amount (in billions)	Change (%)
Content Production & Acquisition	10.54	11.59	-9%
Marketing & Advertising	1.53	1.74	-12%
Salaries & Benefits	4.77	5.27	-10%
Operational Costs (Streaming)	4.33	3.09	+40%
Technology Infrastructure	0.15	N/A	N/A

Paramount Global (PARA) - Business Model: Revenue Streams

Subscription fees from Paramount+

For the nine months ended September 30, 2024, Paramount+ generated revenues of $4.332 billion, up 40% from $3.093 billion in the same period of 2023. The increase was attributed to a growth in subscribers, which reached 71.9 million as of September 30, 2024, compared to 63.4 million a year earlier, reflecting an increase of 13%.

Advertising revenues from TV and streaming

Advertising revenues for the nine months ended September 30, 2024, totaled $7.521 billion, a 5% increase from $7.179 billion in 2023. This growth was driven by an increase in impressions from Paramount+ and Pluto TV, along with higher political advertising revenue.

Licensing fees for content distribution

Licensing and other revenues fell to $3.462 billion for the nine months ended September 30, 2024, down 22% from $4.424 billion in 2023. This decline was primarily due to a lower volume of licensing in the secondary market and reduced revenues from content produced for third parties.

Revenues from theatrical releases

Theatrical revenues for the nine months ended September 30, 2024, were $399 million, a decrease of 46% from $735 million in the same period of 2023. The drop was attributed to the timing and mix of film releases.

Merchandising and ancillary sales from franchises

Merchandising revenues, although not explicitly detailed in the financial reports, are generally derived from the licensing of trademarks and brands for consumer products, recreation, and live events. These revenues are included under licensing and other revenues, which saw a decline in 2024.

Revenue Stream	Q3 2024 Revenue	Q3 2023 Revenue	Change (%)
Subscription Fees from Paramount+	$1.428 billion	$1.138 billion	25%
Advertising Revenues	$2.174 billion	$2.133 billion	2%
Theatrical Revenues	$108 million	$377 million	-71%
Licensing and Other Revenues	$1.234 billion	$1.361 billion	-9%

Updated on 16 Nov 2024

Resources:

1. Paramount Global (PARA) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Paramount Global (PARA)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Paramount Global (PARA)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.