Skip navigation

Media Money


Current DateTime: 09:35:40 09 Feb 2012
LinksList Documentid: 23279714
Expiration DateTime: 2/9/2012 9:36:14 AM
Media Money Video Gallery
CNBC's Jon Fortt; Shaw Wu, Sterne Agee; and Mark Sue, RBC Capital Markets, discuss Cisco's latest earnings. Also, the u...
Rupert Murdoch just made some big progress in its hacking scandal, which will minimize the embarassing details shared in...
MEDIA MONEY INDEX
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...
Loading...

Current DateTime: 09:35:40 09 Feb 2012
LinksList Documentid: 23279714
Expiration DateTime: 2/9/2012 9:36:14 AM

MEDIA MONEY VIDEO GALLERY

» More

Current DateTime: 09:35:40 09 Feb 2012
LinksList Documentid: 31765984
Expiration DateTime: 2/9/2012 9:36:04 AM
    • Cisco & News Corp Report Earnings 

        CNBC's Jon Fortt; Shaw Wu, Sterne Agee; and Mark Sue, RBC Capital Markets, discuss Cisco's latest earnings. Also, the update on News Corp's earnings, with CNBC's Julia Boorstin.

    • News Corp Earnings Review 

        Rupert Murdoch just made some big progress in its hacking scandal, which will minimize the embarassing details shared in court, reports CNBC's Julia Boorstin.

    • The Trade on Sprint & Disney Update 

        The Fast Money crew with the trade on Sprint, ahead of its Q4 earnings. Also, CNBC's Julia Boorstin has an update from Disney's conference call, as well as the outlook for ad revenues.

    • Disney Conference Call Update 

        CNBC's Julia Boorstin has the latest details from Disney's conference call, reporting attendance is up at the theme parks, and the company will launch a new broadcast channel in Japan next month.

    • Disney's Iger on Q1 Results 

        Robert Iger, Walt Disney president & CEO, explains how the current quarter is trending in ad sales and parks bookings, with CNBC's Julia Boorstin and Maria Bartiromo.

    • Disney Earnings Preview 

        All eyes will be on ad trends, cable fees and theme park performance in Disney earnings, with CNBC's Julia Boorstin.

RSS FEED

» Help

Current DateTime: 09:35:41 09 Feb 2012
LinksList Documentid: 31625651

MOST SHARED


Current DateTime: 09:35:41 09 Feb 2012
LinksList Documentid: 31330905
Expiration DateTime: 2/9/2012 9:36:45 AM

Current DateTime: 09:35:41 09 Feb 2012
LinksList Documentid: 23452000
Expiration DateTime: 2/9/2012 9:36:40 AM

Current DateTime: 09:35:41 09 Feb 2012
LinksList Documentid: 23452764
Expiration DateTime: 2/9/2012 9:36:24 AM

Viacom And CBS Break Final Ties--But Was It All Necessary?

Published: Monday, 21 Apr 2008 | 1:32 PM ET
Text Size
By: Julia Boorstin
Correspondent

CNBC.com

Ever since media mogul Sumner Redstone split Viacom [VIA  Loading...      ()   ] and CBS [CBS  Loading...      ()   ] into two separate companies (he's chairman of both), they've become increasingly competitive. And just this Sunday, Viacom's Paramount Pictures studio said it's no longer going to distribute movies to CBS' Showtime.

The deal started in 2002, and UBS analyst Michael Morris tells me brought Paramount an estimated $100 million in annual revenue. Now Paramount is teaming up with MGM [MGM  Loading...      ()   ] and Lionsgate  , who currently also supply movies to Showtime, to create a new premium cable channel and video-on-demand service beginning in fall 2009.

This speaks to how incredibly important these deals selling movie rights to pay TV are to studio produts. It also says a lot about how much the studios, in this more challenging environment, want to cut out the middle man--in this case Showtime--whenever possible. Viacom CEO Philipe Dauman said that the new channel will give more flexiblity.

One key issue here is digital distribution. Iff Paramount remains in control, not Showtime, Paramount may choose to offer movies on iTunes at the same time as it airs it on TV and perhaps timing digital distribution sooner than Showtime would have allowed in its previous relationship.

And cable channels are doing quite well for the media giants. Just look at the huge growth of Disney's [DIS  Loading...      ()   ]ESPN and Disney Channel. WIth viewership shifting away from the networks and towards cable, this could be a wise investment. Plus, Viacom already has infrastructure in place, having plenty experience with cable networks with MTV and its other properties.

So what does this mean for Showtime? Losing Paramount, MGM and Lionsgate can't be good, especially because all the other major studios (Disney, Warner Bros., and Universal) are committed to other pay-TV distribution deals through HBO and Starz. Showtime's CEO said they're not concerned, and that those very suppliers who are leaving them have given them enough movies to last until 2011.

So Viacom is now creating its own version of CBS' Showtime, CBS has created its own movie studio, a mini Paramount of sorts. And CEO of Paramount, Brad Grey, is rebuilding Paramount's TV production business to better compete with CBS' TV productions and others.

It certainly seems to me like both companies are trying to recreate what they lost when they split off from the other half of the company. Which raises the question: why bother splitting up the old Viacom into two companies, if it's only going to result in two companies that are just as broad and varied as the original one? Redstone has said he wants CBS and Viacom to function truely independently, and they certainly are.

Questions?  Comments? 

© 2012 CNBC, Inc. All Rights Reserved


Current DateTime: 08:36:39 09 Feb 2012
LinksList Documentid: 29778428

Current DateTime: 02:53:04 09 Feb 2012
LinksList Documentid: 29779196

Current DateTime: 09:19:18 09 Feb 2012
LinksList Documentid: 29779197

Current DateTime: 02:53:04 09 Feb 2012
LinksList Documentid: 29779199
CNBCCNBC
About CNBC  |  Site Map  |  Video Reprints   |  Advertise  |  Help  |  Contact
Privacy Policy  |     |  Terms of Service  |  Independent Programming Report
  Data is a real-time snapshot  *Data is delayed at least 15 minutes
Global Business and Financial News, Stock Quotes, and Market Data and Analysis

© 2012 CNBC LLC.  All Rights Reserved.
A Division of NBCUniversal
Thomson ReutersThomson Reuters