• by Wayne Friedman , May 5, 2008

Viacom said advertising growth is strong at its advertising-supported cable networks and will continue into the second quarter.

Advertising sales rose 8% overall, led by Nickelodeon, Comedy Central and TV Land. Overall, revenue at Viacom's media networks climbed a healthy 16% to $2.02 billion. The division also witnessed 13% growth from fees paid by cable and satellite providers.

"While it is still early in the quarter, we anticipate our second-quarter domestic ad sales growth to be comparable to growth in the first quarter," said Philippe Dauman, chief executive of Viacom, during a conference call with analysts.

Viacom also said it will contribute $100 million to its new, as-yet unnamed pay movie channel--but that it will not be a majority owner, just a significant shareholder.

Although many analysts question the logic of starting another pay TV service in a well-established marketplace, Dauman said the new premium channel will be "a game changer." The three movie studios--Paramount, MGM and Lionsgate--will now be able to offer their films with more flexibility than is currently available in the pay-TV window.

Viacom's first-quarter results had its net income soar 33% to $270 million on 15% increased revenues to $3.12 billion.

Viacom's cable channels ratings were up 5% in the first three months of 2008, with four networks--MTV, Nickelodeon, Comedy Central and TV Land--growing ratings by double-digit percentages over a year.

Filmed-entertainment revenue rose 12% to $1.15 billion on a 22% climb in DVD revenues.