Between 2010 and 2020, Nickelodeon lost more than 60% of its audience.
Snapped up by Netflix, YouTube, Amazon, and other streaming-first or user generated content platforms, Nickelodeon began to feel like a product of a bygone era. It didn’t necessarily matter that Nickelodeon was still the most popular kids network on cable TV; the issue was cable TV was bleeding customers as cord cutters turned to streaming alternatives.
Kids content was arguably more susceptible to the changing tides. Children are more digital friendly, and cheaper mainstays like YouTube Kids, Netflix, and Disney+ provided an always-on, ad-free, constant alternative to a television schedule. Nickelodeon executives were aware of their declining ratings. There were some options throughout the mid-aughts — NickHits launched on Roku and Amazon Prime Video Channels, while Viacom (now ViacomCBS) licensed some of Nickelodeon's most popular shows to Netflix.
Some helped, but none really stuck the landing. Until Paramount+ launched, and Nickelodeon found its new moment.
Bookended with classic Paramount films and live sports, Nickelodeon became part of a bigger general entertainment streaming package that caught people’s attention. If kids were spending more time watching entertainment online, Nickelodeon would meet them where they were. It’s working, according to ViacomCBS CEO Bob Bakish.
Yes, Spongebob Squarepants is still popular.
“Nickelodeon, in particular, is turning into a powerful driver of subs and engagement, probably more quickly than we would have thought,” Baskish said. “It's a clear sub driver since the relaunch, and it now accounts for a strong double-digit share of streams...I think it's also worth noting that the SpongeBob franchise in totality quickly moved to the top of the rankers at Paramount+.”
In layman terms, Nickelodeon is a primary reason people are signing up for Paramount+. This may seem obvious, but the battle for kids content is only just heating up for three reasons:
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Kids watch a lot of television
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Having kids content on a streaming service makes the service a necessity not an option
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Streaming becomes multi-generational
Ever Heard of Paw Patrol?
Saying kids consume large amounts of television is an understatement. In 2020, the American Academy of Child & Adolescent Psychiatry found that “children ages 8-12 in the United States spend 4-6 hours a day watching or using screens,” on average. They’re increasingly spending more time watching things online, mostly split between Netflix and YouTube.
While YouTube is the most popular platform among kids, it poses a threat that parents hate: It’s completely unregulated and there are risks that children will come across content they shouldn’t. Netflix is better. Disney+, arguably the best. Anything that goes on Disney+ is certified Disney. Not only are parents paying for a brand they know their kids will enjoy, but it’s safe.
Netflix is getting into the kids game, but there are still two companies whose brands are synonymous with children's television: Disney and Nickelodeon. When developing a general entertainment service (as opposed to a niche offering like Criterion), not playing to kids’ interest is a nail in the coffin more often than not. Even Apple is trying to find its way into the kids market, partnering with Skydance Animation — a studio run by former Pixar chief John Lasseter. (Lasseter left Pixar after allegations of sexual harassment were brought forward.)
But whereas Netflix and Apple have to try and come up with kids programming that draws tykes in and keeps their attention, Nickelodeon, Disney, and Cartoon Network, which has found its home on HBO Max, don’t have to try as hard to convince consumers they have the goods. As Brian Robbins, president of Nickelodeon, told Variety last year, “franchises are so important in a world where there is so much content being made.” See: a Star Trek cartoon airing on Nickelodeon. Big franchise plus big network ideally equals audience recognition.
Again, it can seem obvious, but brand recognition — and more importantly, character recognition — is vitally important in the streaming space. In 2019, 60% of Netflix’s usage came from kids and family driven entertainment. Netflix has partnered with DreamWorks Animation, Sony, and even ViacomCBS to ensure kids can find their old and new favorite shows on the streaming service. Paramount+ and Disney+ don’t have to try to convince kids (and their credit card wielding parents) that they’re home to favorite movies and TV shows. They just have to keep producing.
For every new High School Musical series or Mighty Ducks show, Nickelodeon is going to have a Paw Patrol movie or new Spongebob Squarepants film. ViacomCBS is launching an entire studio dedicated to producing more content based in the Avatar: The Last Airbender universe.
Kids already know the characters, and having more of what they know might convince them to spend more time on Paramount+ than Disney+. Companies look at a few key streaming metrics: what leads to people signing up (growth), what are people watching (engagement/usage), and what’s preventing them from canceling (retention). Kids content, if done properly, helps accomplish all three.
“Clearly, ‘kids’ is working for us,” Bakish said on a recent earnings call, adding that ViacomCBS is leaning into producing more Nickelodeon originals for Paramount+. “We’re really excited about getting to have something on the platform every week that's fresh for someone to watch.”
We Can’t Cancel
The key to pulling ahead in the colloquial streaming wars is finding a way to be a necessity instead of an option.
There are a few ways to do this: HBO Max is the best place for HBO fans to watch their favorite shows or anticipated new shows, Hulu is the only streaming service to watch new FX series on, and Disney+ is the only streaming service that’s 100% kid friendly. Let’s examine the last one.
If you live in a household with kids, Disney+ is a no brainer. The streaming service is on the cheaper end of the spectrum, it’s guaranteed to carry something they want to watch, and there’s no risk of stumbling upon shows or films they shouldn’t be watching. If parents are into Marvel and Star Wars, well, that’s just an added bonus.
Before Disney+ launched, Disney’s former head of streaming, Kevin Mayer, reiterated that Disney+ was more than just a platform for kids. That’s true, but Disney’s biggest strength is that it’s so synonymous with safety, gold standard entertainment (classic animated films), and characters that kids already know and love. The core to being a successful entertainment company in 2021 is love and being able to monetize that love. No company is better at that than Disney.
On the kids front, one company that comes close is Nickelodeon. In 2018, Spongebob Squarepants was still the most recognizable kids brand in the United States, according to Parrot Analytics. Paw Patrol is rated the most popular kids show in the United States. New upcoming series that play on classic titles, like Rugrats and iCarly, are tapping into decades-plus of recognizable programming that parents and kids might enjoy together.
This, too, is key — 75% of parents polled in a Common Sense Media report in 2018 said they spend multiple hours a week watching television with their kids. New parents may have grown up with Spongebob and iCarly themselves. Paramount+ has enough Nickelodeon catalog to encourage adults to revisit childhood favorites like All That, CatDog, Drake and Josh, Rocket Power, Fairly OddParents, and Hey Arnold while their kids watch their own favorite series.
Nickelodeon, alongside Disney and Cartoon Network, become a part of every new generation. If executed right and brought together on one platform, bookended with a plethora of other content, Disney+, HBO Max, and Paramount+ become obvious ongoing subscriptions instead of possibilities.
This Is Just the Start
The fight for kids’ attention in the streaming space feels like it’s only just beginning. WarnerMedia is rebranding its Cartoon Network division to make it the company’s family brand, and ordering way more series. Apple is beginning to tap into the kids market, and Netflix is trying to release six animated films a year — more than Disney Animation Studios and Pixar combined. Plus, Netflix has a litany of kids shows, and partnerships with crucial studios like Moonbug (makers of Cocomelon, one of the most popular global kids channels on YouTube). Disney will continue to Disney.
ViacomCBS is in a position to become a go-to streamer for kids content. Executives overseeing Paramount+ need to determine how to make it a necessity, not just an option. The answer might not be in a new Halo live-action show or another NCIS; the answer might be found in Bikini Bottom.