Viacom, Inc. will weather the economic downturn by focusing on “organic growth” instead of any “significant acquisitions,” according to president and CEO Philippe Dauman.
Speaking at the annual UBS Media and Communications Conference in New York, Dauman downplayed the company’s announcement least week that it would cut 850 jobs, or 7% of its workforce, and instead focused on the company’s positioning as a content provider with multiple revenue sources across each of its television, movie and digital divisions.
Dauman was bullish on Nickelodeon, VH1, MTV and BET, which recently underwent a shift in programming leadership. He conceded that MTV has struggled as repeated reruns of hit shows in the age of the DVR and episode streaming have become a less viable. The network will instead concentrate on more original and less acquired programming while also adding elements to reruns in the hope of stemming viewer hemorrhaging.
For instance, a selection of comments from The Hills fan forum Backchannel are featured in the rerun of the previous week’s episode. MTV will employ the same strategy with the upcoming iteration of Real World.
“We think we have all the attributes to make our way through this environment and grow our brands,” said Dauman, asserting that the job losses will not impact Viacom’s “content creation.”
Instead, cost savings will be realized by imposing operational discipline including cutting the number of locations in New York from six to three and freezing salaries for senior management.
He added that there are cost saving opportunities in an economic downturn. For instance, the company was able to renew its lease at the New York headquarters at 1515 Broadway without an increase in rent.
“The changes we’re making are not the kind of changes we’ll have to reverse when the economy improves,” he said.