“With a 30 percent margin you can price it in the low-teens to up to $20 depending on how much product. Our sense is you want to be at the lower end of that price point to really have something to appeal to cord-nevers and again create a catalyst at that entry point in the market,” Bakish said, referring to the younger generation of consumers who have never subscribed to traditional television services.
“Ultimately the question will be ‘how does the market segment?'”, he asked rhetorically, opining that the $40 price point is too high to entice people into the market yet not sufficiently low to encourage true sports fans to sacrifice the additional content available in a more expensive price bracket.
Currently, no real comparable product is available, according to Bakish, yet indications are that it could gain appeal.
“You could say a product like Netflix which is priced around $10 and has tens of millions of subs(cribers) in the U.S. alone indicates there should be interesting demand at that level of the market,” he highlighted.
Viacom is well-placed to offer this service, says Bakish, given that it has a market-leading presence across a variety of non-broadcast and non-sports categories with channels such as Nickelodeon, Nick Junior, Comedy Central, MTV, BET and Paramount.
“You take that bundle, that’s a nice core, you add a few more things and we think it’s a very interesting proposition.”