In the wake of CBS and Viacom announcing their merger, both companies’ shares have dropped roughly 20%. At today’s Vanity Fair New Establishment Summit in Beverly Hills, Viacom president and CEO Bob Bakish was asked what exactly was up. When the deal was announced, the combined entity was valued at $30 billion. Now, that figure has dropped to around $23 billion.
“We’re deep in integration planning, we haven’t closed this deal, people have to take a beat,” Bakish said in response to the question by CNBC’s Julia Boorstin. “The market will see the value of this company.”
While major studios like Disney, WarnerMedia and Comcast have gone wild for streaming services and consolidating their own IP under exclusive OTT arms, Bakish preached that the multi-pronged nature of Viacom — with linear ad-supported cable channels, CBS’ mega-eyeball network, Showtime and CBS All Access paid streaming, and PlutoTV’s free-ad supported streaming –is still competitive and viable in the ever-changing media landscape. Most importantly, streaming services will need content, and Viacom is still selling, evident in the half-billion-dollar bids that its South Park is going for.
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“We’ll be better equipped to handle this world,” said Bakish. “I think we unequivocally have to do business with third parties and operate our own platforms.”
Bakish said a combined Viacom-CBS is primed for a future where consumers are watching an immense amount of content across different segments, “from operating price points that are free to hundreds of dollars on VOD.”
“I believe Viacom-CBS as a combined company is looking to supply as many segments as possible,” he added.
Boorstin asked whether Bakish was daunted by a theatrical movie universe where Disney dominates at the box office with its Marvel movies. Bakish, giving high praise to Paramount Studios boss Jim Gianopulos, pointed out how the exec turned around a studio that was previously losing a half billion a year under its previous administration into being profitable.
“A (film) slate needs balance, you have to have tentpole films like Terminator next month and next summer’s Top Gun: Maverick, but at the same time you have to have movies like Rocketman,” said Bakish, giving credit to Gianopulos’ philosophy for building a diverse, fully breathing slate.
“The range of different types of films will create a near-term value in the downstream window and a higher library over time,” said Bakish.
There is no specific date for the Viacom-CBS merger to be finalized, but the deal is expected to close before the end of the year.
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