Want to get a show on CBS? Make sure you give the network a piece of the action, its chief Les Moonves suggested to investors today at the Needham Emerging Technology Conference.
The syndication market has “exploded” with the growth of domestic and global subscription VOD services. As a result, “having ownership is a huge, huge difference — and it does affect everything we do. A show that’s 100% owned [by CBS] will generally get a better time period and generally will be more important to the network.”
That was evident in the six new shows CBS picked up for this fall. It owns 100% of three of them, 50% of two, and 70% of one.
Illustrating how ownership pays off, he noted that Elementary, which CBS owns, last year “made approximately an $80 million profit for the corporation,” while Person Of Interest, owned by Warner Bros., “broke even.”
“As I’m looking at my new schedule, guess which show got renewed? It became really self evident.”
Sony Pictures Television chairman Steve Mosko understood the rules, Moonves told the audience, when he pitched Kevin James’ upcoming sitcom Kevin Can Wait. The “first thing” he said was “‘we get that to get on it’s got to be a 50-50 partnership.’ I said ‘done, you’ve got a deal.’ “
“We’re not alone in this,” the CBS chief says, observing that Fox owns nine of 10 new shows, and ABC has 10 of 11.
In addition to the general growth of SVOD services, CBS sees opportunities to sell in additional markets — notably China.
“We’re finally making legitimate deals in China,” he says. “It’s substantial numbers for the first time. Before it would be pennies.”
That’s true despite widespread pirating. “The No, 1 show in China is The Big Bang Theory. The only problem is Warner Bros., which produces the show, and CBS, which airs it, sees none of that money because it’s all in the open market. Now it’s starting to become more legitimate.”
Moonves says he doesn’t feel threatened by Netflix as it expands globally. “We’re a frenemy, but more friend than enemy.”
On U.S. advertising, the CBS chief reiterated his confidence that the upfront market will be strong. U.S. political ad sales will help, especially at local stations, with buying expected to hit a new high.
“We like the political race heating up and hope they all spend a lot of money,” he says. “It’s fairly certain that it’s going to be a contentious election. I don’t think there’s much doubt about that.”
Moonves says that CBS doesn’t feel a need to cut back on the number of ads it packs into a show — a trend this year at some basic cable networks.
“Sometimes you watch a movie on Turner, it gets very frustrating,” Moonves says. “You get two minutes of content and five minutes of ads. We don’t do that.”
He talked up CBS’ digital initiatives including the CBSN news service. In a recent visit to its headquarters he saw that “at any given minute they can basically tell me everybody who’s watching. So what? Well, guess what: If this kind of story is scoring, and this kind of story is not, tomorrow I’ll put more of that kind of story on. Higher ratings. It’s not hard.”
As an aside, he observed that the “biggest mistake” CBS made — before he moved to the company — was the 1988 decision to sell its recorded music business to Sony.
Then-CEO Larry Tisch “couldn’t stand the guys in the record business. He thought there was a little too much drugs and rock ‘n roll.” But it “wasn’t a great deal. Sony Music has done very very well since then.”
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