Paramount Pictures Extends Output Agreement with MGM+ Through 2025: A Strategic Alliance in the Streaming Era
In a significant development that underscores the evolving landscape of film distribution, Paramount Pictures has quietly extended its output deal with MGM+ (formerly known as Epix) through 2025. This strategic move builds upon the original agreement reached in 2021, ensuring continued collaboration between the two entities.
Key Terms of the Extended Agreement
Under the renegotiated terms, most of Paramount’s theatrical releases will continue to premiere exclusively on Paramount+ before transitioning to MGM+. This arrangement allows Paramount to maintain control over the initial streaming window for its films, capitalizing on the growing popularity of its own streaming platform.
Evolving Pay 1 Window Strategies
The traditional Pay 1 window has undergone significant transformations in recent years, driven by the rise of streaming platforms and changing consumer viewing habits. Historically, Pay 1 deals between studios and premium cable networks were considered financial cornerstones of the film release model, providing stability in an otherwise unpredictable industry.
However, the streaming era has challenged this model, prompting major media companies to explore new strategies. NBCUniversal’s Peacock, for instance, has made Universal’s slate available in the Pay 1 window, reporting that these theatrical releases have been instrumental in driving new subscriptions.
Historical Context: A Partnership Rooted in Collaboration
The current Paramount Pictures and MGM+ agreement is an extension of an original five-year output deal signed in 2017 when Epix launched as a joint venture between Paramount, Lionsgate, and MGM. In subsequent years, MGM acquired full ownership of Epix, buying out its partners.
Additional Provisions: Expanding the Scope of Collaboration
In addition to the Pay 1 window rights, Paramount Pictures also has the option to sub-license older titles and non-Paramount movies licensed by MGM+, including content from MGM and Sony Pictures. Previously, Epix had “white label” deals with Amazon and Hulu for its movie titles, but these agreements have expired, and the films are now directed to Paramount+.
Impact on Paramount’s Streaming Strategy: Consolidation and Exclusivity
Paramount Global announced in 2022 that, starting with 2024 film releases, Paramount+ would become the exclusive streaming home for all new Paramount Pictures movies in the United States following their theatrical runs. This decision reflects Paramount’s commitment to consolidating its content under its own streaming platform, further strengthening its position in the competitive streaming landscape.
Conclusion: Adapting to the Changing Media Landscape
The extension of the output deal between Paramount Pictures and MGM+ through 2025 underscores the enduring importance of the Pay 1 window, albeit with evolving strategies and terms. As the streaming landscape continues to reshape the film industry, studios and platforms alike are adapting their approaches to maximize revenue and audience engagement. This strategic alliance demonstrates the industry’s resilience and adaptability in the face of constant change.