Warren Buffet's bet on the streaming war
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“Paramount struggles to capture audiences and advertisers against rivals like Disney, Netflix or Warner Bros. Discovery, and is not badly positioned to do so”observed the North American portal, specialized in business, Business Insider.

The platform seeks to compete with the large firms in the sector, increasingly inhabited by renowned companies such as the aforementioned Disney, Netflix or Amazon Prime Video, among others.


Low cost of fees

In the big studios, the current discussion involves the launch of advertising-supported services, something that until now was reserved for broadcast television and pay television, from which the platforms wanted to get away. However, everything seems to indicate that the debate has been closing in the last year in favor of the incorporation of advertisers.

The Paramount firm, successor to the renowned Viacom, owns Paramount Plus Y pluto TV, among others, in addition to the local Telefe. From there, it competes for audience and advertisers with firms from NBC Universal, Disney, Warner Bros, Discovery and Netflix.

The reason for Buffet’s bet is centered on the low cost fares that it offers to users. According to a private survey, it is among the lowest in the market along with NBC Universal.

In the case of Disney, Warner Bros. Discovery and Netflix, they charge rates up to three times higher, especially for access to Premium content, according to figures from previous information from the same source.

According to company executives, Paramount’s strategy is to charge cheaper but collateralize benefits through other businesses, linear and cable. This is something that the billionaire Buffet found attractive when deciding to increase his investment in the company.

“We’re not necessarily looking for the highest CPMs,” said Naveen ChopraExecutive Vice President and Chief Financial Officer of Paramount in presenting the company’s latest financial results, noting: “We do not believe that it is there where the largest reserve of dollars exists”:

According to Business Insider, for Chopra, Paramount’s focus is more on increasing viewership than advertising revenue. A clear example is the increase registered in Pluto TV: the free signal added 2.4 million monthly active users during the quarter, thus completing 72 million worldwide.

Warren Buffett


Buffett’s goals

Buffet bets on investing in companies with massive products and services, solid and reliable. That is why he was always averse to cryptocurrencies, to the point of affirming that “that” he would not pay even 25 dollars for all the bitcoins in the world ”. In general, he has preferred to invest in solid, well-recognized, massive brands like Coca-Cola.

His advice to small investors matches the facts. One of the recommendations of the prominent investor lies in “reading a lot”, “sitting and thinking” and surrounding yourself with people as or more capable than you, in order to “go to sleep a little smarter every day”, because “knowledge spreads accumulates, such as compound interest.

The magician or “oracle” of Omaha, as he is also known, gave the note in recent days when it was also known that his firm, Berkshire Hathaway, invested more than $4.1 billion in TSMC (for Taiwan Semiconductor Manufacturing Company), the world’s largest chip maker.

The question lies in whether his bet was prompted by the geopolitical dispute between China and Taiwan or if the investment responds to the growth in demand for microchips. The truth is that after the announcement of Buffett’s investment, the Taiwanese stock market celebrated it with a rise of 7.9 percent.

It remains to be seen whether the decision to increase his investment in Paramount is timely. What cannot be denied is that the billionaire has rarely bet on a loser.

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