Viacom CEO sees ad market improving
NEW YORK (Reuters) - Viacom Chief Executive Philippe Dauman is bullish on advertising revenue growth for this quarter and next year as high ratings from shows like "Jersey Shore" help bring in new advertisers.
Dauman expects Viacom, home to MTV, Comedy Central and Nickelodeon cable networks, to have a strong upfront market this spring, the annual period when advertisers book commercial time for the year.
"We feel extremely well positioned for that upfront," said Dauman at the Reuters Global Media Summit on Thursday. "There is momentum in the market place and momentum on our networks."
Dauman is the latest executive to weigh in on the debate over the extent to which an economic recovery has lured marketers back to the table.
Big companies that provide wireless services and tech products, as well as revived automakers launching new models targeting younger buyers, are snapping up ads on Viacom's cable networks. The networks are also seeing interest from new advertisers, such as American Express, that once shied away from its cable networks.
Viacom's advertising revenue growth has accelerated in the past several consecutive quarters. In the third quarter, U.S. ad revenue rose 8 percent year on year, topping a rise of 4 percent in the second quarter.
The advertising growth, complemented by fees paid to them by cable distributors, have made Viacom a media darling on Wall Street. Shares of the company have soared 32 percent year-to-date, well outpacing the Standard & Poor's 500 index's 6 percent gain.
Dauman also led negotiations in a deal with pay TV service Epix and Netflix. Epix, which is jointly owned by Viacom, Lions Gate Entertainment Corp and MGM studios, signed a landmark 5-year $950 million deal with Netflix in August that made the fledgling channel profitable years ahead of plan and drew the attention of media companies that have dallied with the DVD rental-by-mail and online streaming company.
"Netflix is a great partner for us," Dauman said. "I think Reed Hastings, who founded and runs Netflix, has been a visionary."
Lately, Hollywood executives of TV and movie studios are looking to stanch the growth of Netflix, which is increasingly seen as a competitor.
Viacom, which also owns Paramount Pictures, is open to distributing its content to other platforms and is experimenting with TV Everywhere, which gives cable subscribers the ability to access TV shows and movies on any device.
However, Dauman ticked off a litany of problems -- including different technology standards among distributors and the slow pace of measuring viewership --that need to be addressed before TV Everywhere can grow its legs.
"I think some distributors have been rather slow in really implementing it in a way that works," Dauman said. "I think some people made announcements ahead of the reality."