MediaFile

TV Content wars, blackouts could spur M+A

Dish customers: No 'Breaking Bad' for you! (Photo: Reuters)

 

Evercore analyst Bryan Kraft believes the prolonged blackout that has left DirecTV’s 20 million subscribers without MTV, Comedy Central or Nickelodeon for a week, could lead to some industry consolidation.

In a research note out late Wednesday night, the analyst said if content providers Viacom, as well as home of ‘Breaking Bad’,AMC, which was dropped from No. 2  satellite provider Dish Network in July, get the upper hand, it raises the chances of a merger between satellite companies and cable providers.

If DirecTV and Dish comes out the winners, he said, it encourages cable TV networks to merge, but only when their valuations fall. DirecTV has pushed backed against what it claims are exorbitant increases in Viacom’s programming fees that it says it does not want to pass on to customers.

And DirecTV viewers aren’t the only ones suffering. Kraft estimates that the dispute is making Viacom lose about $14 million a week. Meanwhile DirecTV would need to lose 1.15 million subscribers before its cash flow was impacted. Kraft said that if DirecTV expects to lose more than 1.15 million subscribers, it should pay up the $3 per subscriber fee Viacom is likely seeking.

As one of the most high profile blackouts stretches into its second week, time will tell whether the spat will be the one that changes the pay TV landscape for good or whether it just causes viewers to change the channel.

Netflix: The New Arch-Frenemy

Albanian Army marching in Tirana's main square (Photo: Reuters)

 

The Albanian Army is coming everyone, watch out!

We’re only into week 1 of big media companies reporting their quarterly earnings and the most prominent name hasn’t been CBS Corp, Time Warner Inc, Comcast Corp, and Viacom — instead it’s all been about Netflix.

Pretty much on each of these companies’ conference calls, the $4 billion company from Los Gatos, California was a key reason for a boon to the bottom line by supplying  ’found money’ by digital licensing of shows that would have been gathering dust on a shelf somewhere in Hollywood. But also on the calls for several of the same companies, Netflix was seen by analysts as a threat to their future. Let’s not forget the four who reported this week have combined market value of over $160 billion.

At CBS on Tuesday, which most people see as a broadcast and billboards advertising company, the first quarter was given a nice bump from its licensing of old CBS shows like”‘Cheers” but also by newer cable shows like Showtime’s “‘Dexter” and “Sleeper Cell”. Here’s the ever ebullient CBS CEO Les Moonves telling analysts on Tuesday how great Netflix and other copycats are:

Vevo relaunches with closer Facebook ties

Vevo, the music video company, has relaunched the popular site with a more personalized, social, long-play viewing experience getting closer and further away from that MTV experience at the same time.
One of the big changes is that you can now only get the full benefits of Vevo with a Facebook login in, which allows you to create a personalized Facebook playlist and share the videos you’ve watched with your friends on Facebook.

Vevo was the second most watched online video service in the U.S. in January with more than 51.5 million unique visitors watching an average of 62  minutes of video that month according to comScore. It is also YouTube’s number 1 partner.

A reminder that Vevo is owned by Universal Music Group, Sony Music Group and the Abu Dhabi Media Company, It also features music videos from EMI and many independent labels but not Warner Music Group, the third largest label owner.

Viacom chief Dauman plays down Nickelodeon ratings dip, sees more ads

Viacom CEO Phillipe Dauman

Viacom Chief Executive Phillipe Dauman tried to play down the Nickelodeon surprise double-digit ratings drop in September as a Nielsen glitch which is being worked on and would not impact the upcoming quarter.

Dauman, speaking at a UBS Media and Technology investment conference, expressed his frustration at the issue but said there was little that could be done about it at this stage. He said “Nielsen is the only game in town”.

He described the timing as unfortunate coming in the crucial September quarter ahead of the holiday season.

MTV lays off staff; Viacom chief cuts outlook

Philippe Dauman Viacom CEO (R) with rapper/mogul Sean Combs

As Viacom Chief Executive Philippe Dauman was managing investors expectations speaking downtown at the Goldman Sachs Communicopia conference, back at  its midtown Times Square HQ, staffers at flagship unit MTV Networks were fretting as pink slips were being handed out. There was widespread concern internally, according to a source. (AdWeek reported it last night).

Dauman was his usual deadpan self as he lowered outlook, saying advertising sales would still be up but by “high single digits” percentage growth rather than the double digits growth he had promised as recently the third quarter call just last month.

Viacom shares tanked by some 9 percent on Thursday, more than a wider market downturn, as investors read Dauman’s cutback as an early sign of worse to come. The worry on everyone’s minds is of another major 2008-like ad recession may be round the corner. Shares are off another 3  percent on Friday morning.  It’s worth noting CBS, whose revenue is 70 percent advertising, dropped by 7 percent despite bullish comments by CEO Les Moonves a day earlier. It shows how jumpy everyone is right now.

Today In Music: Rhapsody’s added 100,000 new subscribers since April

JonIrwin1Rhapsody, one of the pioneers of music subscription services, has added more than 100,000 net new subscribers since the company was restructured in April President Jon Irwin (pictured, left) told Reuters. This means they’ve overcome  a long period of slow or no  growth during which its two major owners Real Networks and MTV Networks tried to figure out what to do with the business amidst the usual issue of conflicting agendas in  joint ventures.

As you may recall, last February both owners agreed to reduce their stakes by bringing in two major label owners Universal Music Group and Sony Music Entertainment as minority holders and also offered warrants to Warner Music Group and EMI Group. The company actively became independent in April.

Now with those closer relationships with the music business but more importantly its expansion through mobile platforms like the iPhone and Google’s Android platform, business is growing.  Irwin said Rhapsody has been adding as many customers as its key music subscription rivals have altogether– it now has around 750,000 subscribers. Last we heard a couple of years ago it was around 700,000-mark.

“Jackass 3D” tops “Avatar” on Viacom Chief’s movie list

Viacom Chief: Favorite 3D movie not Avatar

“My favorite 3D movie of all time is Jackass 3D,” Viacom’s Chief Executive Philippe Dauman said on Wednesday at  Reuters Global Media Summit. The movie, which grossed $116 million in the United States, according to Box Office Mojo was  “relatively low cost” and “significantly profitable,” Dauman said.  “You’ll see more of that coming.” 

What else might the future hold for Viacom in 3D? Possibly Snooki.

Reuters Breakingviews columnist Rob Cox asked Dauman if audiences can  soon expect a Jersey Shore in the third dimension.

“I’d love to see that,” Dauman said, “Gym, tan and laundry in 3D.”

Earlier this month, Viacom said it is selling Harmonix, the video game publisher behind Rock Band and this year’s  Microsoft Kinect hit “Dance Central.”  Dauman said the sale is proceeding swifty but declined to divulge details prospective buyers.  Media Summit  guest chief executives Bobby Kotick and Strauss Zelnick  from Activision Blizzard and Take-Two  respectively, said they’re not interested.

Universal Music pulls videos off MTV website

Universal Music Group has pulled its music videos off of MTV’s websites  in a dispute over syndication rights for Universal’s co-owned music site Vevo.

With Universal Music’s previous online music video contract with MTV Networks ending on Aug 1, the music company had planned to use Vevo as the distribution platform for its music videos. But the problem for MTV is that would mean adverts around the videos would be sold by Vevo, not MTV,  something the music television business found difficult to agree to.

Vevo was launched in December by co-owners Universal Music and Sony Music Entertainment as a dedicated online venue for premium quality music videos –  an MTV for the digital age if you like. It features music from EMI as well but Warner Music Group is yet to ink a deal.

Viacom digs up more YouTube documents for court case

EricSchmidt1Viacom’s ongoing legal fisticuffs with Google over alleged piracy on YouTube rages on. The MTV and Nickelodeon owner on Thursday put out nine additional exhibits in addition to the hundreds of pages that were  put out last month including transcripted deposition from Google CEO Eric Schmidt.  Viacom, which extended CEO Philippe Dauman’s contract today, said the exhibits “make clear one of our core claims in the case: that Google made a deliberate, calculated business decision not only to profit from copyright infringement, but also to use the threat of copyright infringement to try to coerce rights owners like Viacom into licensing their content on Google’s terms.”

Viacom is making that claim based on various statements from Google senior employees while management was considering buying YouTube. 

As for Schmidt’s deposition from May 2009 it’s not particularly controversial, with perhaps the most interesting statement being that he owns 30 computers and claims it has been his practice for 30 years to not retain his emails unless asked specifically.

A $1 bln suit won’t stop Google from getting its Dauman

The big highlight of the McGraw-Hill media summit in New York when NBC Universal’s Jeff Zucker took a couple of shots at Jon Stewart.

But our favorite story came at the end of the day, courtesy of Viacom top dog Philippe Dauman. The background to this story was a question about Viacom’s $1 billion lawsuit against Google’s YouTube  over copyright infringement.

That led Dauman to mention that his son, Phillippe Dauman Jr., happens to work at… wait for it… Google.