Now that megamedia corporate splits are in fashion, there's a new emerging media trend to watch. How will former "sister" companies behave after the "divorce"? Will they get along? Will that formerly-praised "synergy" carryover after the breakup?
Media heavyweight champion Viacom split into two new separate companies at the start of the year, with the new "Viacom" taking MTV Networks, Comedy Central, Spike, and other cable channels as well as Paramount Studios. The new "CBS Corporation" got radio, the CBS TV network, UPN TV, Showtime cable, CBS Outdoor, Simon and Schuster books and the Paramount content creating properties. Once Viacom Chairman Sumner Redstone made the split of the media kingdom, dividing the assets to his conquering co-CEOs charged with carrying forward the legacy, the question wondered was: will it be Tom Freston vs Les Moonves? Which company will outperform the other?
A battle of titans may be brewing...
So far this year, Freston's Viacom has maintained consistent net income performance despite a NYSE drop from a high of $45 to its current $36, while it spun off Dreamworks' library, acquired online community XFire and lost its longtime MTV Network Chief Digital Officer.
Meanwhile, Moonves' CBS Corporation stock shares have stayed between $25 and $26 on the NYSE, with little change in 1st quarter profit despite a very busy first six months of 2006. CBS got mixed up in a two-sided lawsuit with former radio star Howard Stern (which it settled, Stern paying CBS $2million), a disasterous experiment in car wreck morning radio with David Lee Roth (which it corrected with Opie and Anthony), a merger of the WB and UPN TV networks into the new CW and the announcement to hire The Today Show's Katie Couric as the new permanent evening news anchor beginning this Fall. On top of it all, CBS won the 12+ TV May sweeps and the top overall Nielsen ratings for the entire TV season as the top network.
Behind the scenes, things seem to be stirring. Last month, the New York Post reported that the battles were beginning between CBS and Viacom.
Well, there's new evidence of more battling. Viacom-owned Comedy Central's The Daily Show has released a new tongue-in-cheek (what else would you expect?) ad (for your Emmy consideration) saying "We had fake news years before CBS hired Katie Couric."
posted by Chris Kennedy @ Friday, June 16, 2006,