Possible CBS, Viacom Merger: Everything Old Is New Again

Just a few years ago, a re-merger of CBS and Viacom would have been a big deal. But now, with the rise of Netflix -- if not Google, and even the struggling Facebook -- a possible merger of CBS and Viacom seems kind of quaint.

Still, what alternative do these companies have?

Big digital media companies don’t seem be interested. That said -- with all due respect to these venerable legacy TV network group brands -- there is value here -- to consumers and advertisers.

The latter may seem to be a hope for the future. Addressable TV advertising platforms can extend legacy TV networks -- especially when competing with digital players.

Traditional TV network groups have value with big brand advertiser awareness messaging. But connecting that to specific consumer interaction and/or business outcomes is the friction point.

Another benefit of a merger might be carriage negotiations -- with traditional pay TV providers or virtual pay TV services -- to leverage group network deals. But they need to move fast.



Consumers are still restless about paying for mid-level and fringe cable TV networks from traditional pay TV providers -- cable, satellite and telco companies. Preferences lean more toward a la carte programming -- even if that pursuit isn’t entirely available. If not that, then a small package of networks.

The last time around, when CBS and Viacom were under one umbrella, it was an uneasy marriage -- older-skewing content from CBS and Viacom’s younger programming, via MTV, VH1 and Nickelodeon.

Now, Michael Nathanson, of MoffettNathanson Research, believes it’s a “forgone conclusion” that CBS and Viacom will be under one roof again. Seems like a resignation of sorts; the companies have few options.

Still, CBS and Viacom need to go all in and do what they do best: sell advertising. They should take a note of what NBCUniversal Steve Burke has said regarding a NBCU plan for a new wide-ranging ad-supported online presence.

Burke toldVariety: “If we can create the modern equivalent of broadcast television online — how profitable would that be? That seems a more achievable goal than taking on Netflix, Amazon, Apple and everyone else charging $10 a month.”
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