• by Wayne Friedman , April 30, 2009

Soft first-quarter cable network advertising battered Viacom, which resulted in a 34% drop in quarterly net earnings to $180 million.

U.S. cable network advertising for its networks -- such as MTV, VH1, Comedy Central, TV Land, BET and Nickelodeon -- was down 9% to $936 million. Overall revenue for its media networks was down 8% to $1.87 billion from $2.02 billion in the previous period. Income went lower to $629 million from $694 million.

"Marketers have been very cautious and discriminating, holding back much of their budget as they try to gain greater visibility in their businesses," says Viacom chief executive Philippe Dauman.

Some advertisers have been growing their budgets, he notes, with fast-moving categories including wireless, quick-service restaurants, and discount retailers. More hopeful, he says, "we are not seeing any further deterioration." He added that while scatter ad volume has been soft, pricing has been stable.

On the brighter side, worldwide affiliate fees were up 13%. Domestic fees were up 17%, with international revenues declining 6% due to currency exchange problems. Also, Dauman notes that MTV's problems with declining ratings over the last year seem to have stabilized.

Net profit landed at $177 million, an overall 7% decline from $2.91 billion.

Its film entertainment division revenues dropped $1.09 billion from $1.15 billion, with losses widening to a $123 million net loss from a $63 million net loss. Marketing and production costs for Paramount Pictures' "Monster vs. Aliens" was one reason, as well as fewer home video releases in the period.

Paramount is expecting major summer results from its soon-to-be released "Star Trek" movie.