While conceding the company is “excited about” this summer’s Mission: Impossible outing, Bakish said the real action for the studio will come next year. He spoke at Deutsche Bank’s 26th annual Media, Telecom & Business Services Conference in Palm Beach, Fla., in an appearance that was streamed online. Paramount is one of several areas under renovation at Viacom, which is holding formal merger talks with its former corporate mates at CBS. (Bakish did not offer an update.)
“At the end of 2016, Paramount was a mess,” Bakish said. “It consumed about a billion dollars in cash, which is a pretty good trick for a company that has a library that throws off $350 million.” In order to revive the studio, Bakish said he “went to my playbook,” focusing on the basics: management, strategy and execution.
After Jim Gianopulos arrived as studio chief and overhauled the top exec team, the strategy came into focus to blend bigger swings with a slate that would be half-comprised of titles leveraging in-house Viacom IP. In the end, the original goal of financing about 25% of the overall slate, which was waylaid by “some twists and turns with the Chinese,” was met, Bakish said.
“Our new strategy is not one-size-fits-all,” he said. “So we don’t want to take financing on any of the branded films because they are low-risk. … We’d much rather have partners on higher-budget films.”
The other key asset for the studio is a revived TV production arm. Paramount Television is on track to bring in $400M in revenue this year, Bakish said, from titles such as 13 Reasons Why for Netflix, The Alienist for TNT and Tom Clancy’s Jack Ryan for Amazon.
The 40-minute session touched on several other themes that Bakish has been on the stump about since the company’s quarterly earnings and a previous investor conference. He spoke about repairing damaged relations with distributors, many of which were alienated by the aggressive dealmaking style of Bakish’s predecessor, Philippe Dauman.
When he took over as CEO at the tail end of 2016, he recalled, “The single most important question facing the company was, what was the future of domestic distribution? Were we going to get dropped by Charter? There was a lot of noise and drama around that.” Since then, Bakish said, Viacom has “renewed or extended half of our subscriber base” and has no pending negotiations with a major distribution partner over the next year.
Advertising remains a source of concern for many investors. Bakish did not break out numbers for Viacom’s “advanced advertising” tools, which do not rely on traditional Nielsen ratings and methodology, but said those elements “can definitely be scaled.”
On Tuesday, the company will provide the unofficial kickoff to the TV industry’s upfront season, as one of its flagship networks, Nickelodeon, hosts its upfront event for ad buyers. Bakish said that while it’s still early in the selling process for 2018-19, “the tone is quite good.”