Viacom's Dauman Happy With Recent Affiliate Deals
Cites Double-Digit Increases in Carriage Fees; Says Epix Still on Track For October Launch
By Todd Spangler -- Multichannel News, 5/27/2009 3:58:24 PM
Viacom president and CEO Philippe Dauman said the media company renewed four significant carriage deals at the end of 2008 and in the early part of this year on terms "we were happy with."
Dauman, speaking Wednesday at Sanford Bernstein's Strategic Decisions Conference in New York, said that even in "probably the worst possible market" for affiliate renewals Viacom was able to negotiate double-digit rate increases with operators.
"We successfully accomplished these renewals, on terms we were happy with," he said, adding, "I don't think any distributor can live without our networks."
Viacom's cable properties include BET Networks and MTV Networks' Nickelodeon, Comedy Central, MTV, VH1 and Spike TV.
Dauman did not identify the parties, but three of them were Time Warner Cable -- with which Viacom had a very public dispute leading into New Year's Day -- Dish Network and AT&T.
With Time Warner Cable, Viacom had been asking for an additional 23 cents per subscriber, a 12% increase. After TWC balked, Viacom threatened to yank its networks and ran TV spots, newspaper ads and on-screen crawls lambasting the cable company. The terms of the eventual agreement, reached in principle early on Jan. 1, were not disclosed.
In his remarks Wednesday, Dauman asserted that compared with sports programming "our family of networks is a very good value... When we get to a renewal, we can talk to [distributors] about Comedy Central being a much stronger network than the last time they did a deal with us."
Viacom is currently working with distributors on "authentication" plans, which would conceptually give paying video subscribers access to additional cable TV content on the Web. But, Dauman noted, "it's not going to happen overnight," and said a key element of such "TV Everywhere" services will be to ensure online views are measured accurately.
As for advertising sales, Dauman said "the tone is much better" from marketers in recent months but he said the upfront season is likely to be longer than usual. "I think the upfront market, from a volume standpoint, will be not bad," he said. "Our pricing has actually held up pretty well."
Epix, the linear TV and broadband movie service that Viacom's Paramount is launching with partners MGM and Lionsgate, is on track to debut Oct. 1 as planned, according to Dauman.
"We like the economics [of Epix] going forward," he said. "Our market out of the gate may not be as big as the incumbents but we don't need to be... We can live happily on absolute margins that are smaller than the incumbents but very nice for us."
Besides new channels, including the recently announced MTVN and BET Networks spinoff Centric, Viacom has opportunities to grow its existing cable properties, Dauman said.
For example, Spike TV has acquired the basic-cable rights to HBO's Entourage, which Dauman said would provide an anchor for the network to launch the scripted comedy Blue Mountain State in January.
Nickelodeon, meanwhile, is expanding family-viewing programming. Viacom also will continue to expand internationally, Dauman said, calling out the successful launch recently of a Hindi-language network in India.
Asked about how Nickelodeon would be affected by Discovery Communications' plans to refashion Discovery Kids in partnership with toy maker Hasbro, Dauman responded, "Uh, we're not worried about that at all."
He continued, "Discovery had a totally underutilized asset... We don't think you can base a network on just one type of programming. You have to look for the right programming -- you can't force programming that promotes a particular product."
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