Nothing seems to fluster CBS chief Les Moonves, including New York’s new attack on two of his large sports advertisers: fantasy sports powers FanDuel and DraftKings. New York Attorney General Eric Schneiderman issued a cease-and-desist order Tuesday, charging that they’ve operated as illegal gambling sites.
The companies “are big advertisers for all of the networks,” Moonves said this morning at the RBC Technology, Internet, Media and Telecom Conference in Manhattan. “It’s hard to turn on a football game without seeing one of them on every two seconds.”
But “they are not out of business … yet.” And they “are not in the top class of advertisers” led by pharmaceutical and auto companies. “We like their money. We like their advertising. We want them to succeed. But this is not a monumental event for us.”
Sticking with advertising, Moonves reiterated the optimistic report he offered in an earnings call last week: The scatter market “is extremely strong with rates up double digits,” he said. “The health of the ad market was extremely strong in the third quarter, and it’s even stronger in the fourth quarter. So the idea that money is moving into digital at the expense of broadcasting just isn’t true.”
Turning to late-night, Moonves said ratings for The Late Show With Stephen Colbert “are up a lot over [David] Letterman and are up a lot in the younger demographic.” As a result, “late- night is now a very profitable thing for us” with Colbert and The Late Late Show With James Corden. In the last few years with Letterman and Craig Ferguson “it wasn’t. So there’s been a marked change.”
The CBS chief also talked up his CBS All Access streaming platform — and plans to run a new Star Trek series there in January 2017, as well as additional originals.
“People say, ‘Are you competing with Netflix?’ Not really.” The streaming giant pays CBS “hundreds of millions of dollars a year. … It’s not that we should sell everything to them. But they are a valuable partner.”
That’s become a controversial issue: Many media execs now want to limit sales to Netflix and other subscription VOD platforms, saying they encourage viewers to cut the pay TV cord and become accustomed to watching shows without ads. Last week, Time Warner’s Jeff Bewkes said he will tighten the leash on his shows.
“The thing about us is that we’re flexible,” Moonves said. Bewkes “has had a long and interesting history with Netflix.” (In 2010 the Time Warner CEO likened it to “the Albanian army going to take over the world.”) “We don’t feel like Netflix is the anti-Christ. …We’re still learning a lot about it.”
Apple wants to offer its own streaming service, but has yet to do so as programmers demand high prices and other conditions. The tech company wants to offer “15 or 20 channels for $30 or $35 vs the $80 you have to pay today,” Moonves says. “My guess is they’ve delayed it until it’s the right channels and right price.” Here, too, he’s unfazed, claiming that Apple and others who want to challenge cable and satellite “are going to have to get CBS, and they’re going to have to pay for it.”
On the issue of paying, Moonves says it “remains to be seen” how CBS’ negotiations with the NFL will go to continue its Thursday Night Football, having wrapped the second year of two, one-year contracts.
“The ratings were up high single digits” this year vs last, when there were a lot of blowout games. “It’s a phenomenal promotion platform for launching other shows. … The NFL is an important part of our revenue stream. We’re happy with our Thursday night package, and we’d like it to continue.”
But competitors also are eager to score the contract. “What the future will hold, I really don’t know.”