Viacom Stock Jumps After AT&T Carriage Deal – Update

AT&T shares, meanwhile, slipped 1% to $30.77.
Viacom's controlling shareholder, National Amusements, also controls CBS Corp. CBS is currently focused on finalizing its permanent CEO selection, while Viacom is working on its turnaround, more than two years after its CEO, Bob Bakish, took the helm. While National Amusements agreed in a legal settlement last year not to initiate merger talks until 2020, Viacom and CBS are expected by most Wall Street analysts to resume discussions soon, which they are permitted to do of their own volition.
The week before the Viacom deadline on DirecTV and U-Verse, AT&T made news by announcing a new two-tier structure for internet-delivered skinny bundle DirecTV Now. Programmers like Viacom, Discovery, AMC Networks and A+E Networks have faced challenges in the re-bundling pay-TV landscape, given that their content is not generally watched live. The basic tier sheds networks owned by Viacom and other companies. That means linear ratings have flagged and advertising revenue for many companies have softened.
Shares in Viacom, which have had an up-and-down 2019, jumped 4% to close at $26.32 on the news in the pre-dawn hours that the company reached a new carriage deal with AT&T. UPDATED with closing prices.
The upward momentum is a relief to Viacom investors after some recent trading sessions when the company's 52-week low of $23.31 has not felt entirely out of reach. Trading volume was more than twice the normal average, with shares generally ranging between $26.50 and $27 as investors reacted to the new contract.
Viacom also acquired PlutoTV, a free, ad-supported streaming bundle that gives it another long-term platform where it can emphasize not only programming but direct-to-consumer distribution.” /> Carriage deals like the one just reached with AT&T have been a major priority for Bakish, given the deterioration of relationships with distributors under his predecessor, Philippe Dauman.
"We are pleased to announce a renewed Viacom-AT&T contract that includes continued carriage of Viacom services across multiple AT&T platforms and products," the companies said in a joint statement.
As part of the usual jousting over carriage renewals, the company issued a pointed statement accusing AT&T of abusing its enhanced reach after its acquisition of Time Warner (AT&T responded by calling Viacom a "serial bad actor" in negotiations.) Viacom then started running ads across Comedy Central, Nickelodeon and other networks warning viewers about the looming deadline. While an impasse would have been damaging for Viacom, AT&T also risked exacerbating recent subscriber losses across its pay-TV portfolio, which could have increased investor concern about its market position.
Viacom had been girding for battle ahead of Friday's deadline, with an estimated $1 billion in carriage fees hanging in the balance. Investors are registering their relief at the avoidance of a blackout of 23 Viacom networks across 24.5 million households that get DirecTV, DirecTV Now, AT&T Watch and U-Verse cable.

MTV Chief Chris McCarthy On How The Network Got Back In Rhythm: “Now Is Our Opportunity To Grow And Play”

The following are edited excerpts of the conversation. McCarthy, a 15-year Viacom veteran, spoke to Deadline about keys to the turnaround and the overall climate at MTV and its rebuilding parent company.
We’re growing in digital and in our studio. 6 (in 18-34) we’re now No. MTV was No. McCARTHY: When you think about how much we’ve accomplished and how quickly, relative to the landscape and to our peers, it's pretty extraordinary. Now is our opportunity to grow and play. And we’ve tapped less than 10% of our IP. 1. The strategy that we have is dead-on.
As is the case everywhere in television, most of them have needed revitalizing. On his way up the corporate ladder at Viacom, Chris McCarthy has added oversight of several networks, including MTV, VH1, Logo and CMT. EXCLUSIVE. But no rebuilding project came close to the challenges at MTV.
So what did your research show you about who was responding to it? DEADLINE: A lot of your target viewers weren't watching when the show first premiered 10 years ago, in 2009. Did the audience skew older because for those viewers you had the nostalgia factor?
Wall Street continues to believe whether it's through a merger with CBS — which is controlled by your controlling shareholder, National Amusements — or another company, Viacom will have to get bigger in order to survive. DEADLINE: How much of a distraction has the larger M&A speculation been?
On Jersey Shore, it’s 30-somethings, and it helped to bring back our audience in different demos. You’ll see us do more shows like that. In the larger cable world, 60% of networks are outside of 18-49. It also brings in more southern viewers. McCARTHY: On Floribama,  it was squarely in 18-34. We decided to run into that. You’ll see us use that IP and play those different sides. Teen Mom speaks squarely to that.
DEADLINE: Any newer shows you are particularly excited about?
McCARTHY: Shores – we launched seven of them around the world. It’s now early 30-somethings. Some are breaking up. Sharing a beach house with your friends — it’s a time-honored tradition. We started to look at, 'What’s a different subculture of that?' One result was Floribama Shore. But they want to all be together on the shore and that idea gives us a lot to work with. They have kids. And then with the original Jersey Shore, we thought, 'Let's find a creative hook.' It would be a different story, not coming of age. They’re in new marriages.
It’s really a testament to the team that we built, led by [entertainment president] Nina L. They’re makers. Diaz and [head of development] Lily Neumeyer. The way that we look is not through the filter of old shows, but with great, rich, powerful IP. They move fast. It’s a different approach, but it’s one that plays to our strengths.
McCARTHY: There's a project called Border Life, which is set in the town of Nogales, a town that is half in the U.S. We hit a cultural nerve. The show we thought we were going to tape is a lot different from the show we ended up taping. It’s one of the centers of the conversation that’s happening [about immigration]. You’re really experiencing what it’s like for these families. I don’t know that everyone is going to get it and that’s OK. It’s not just a headline. We’re on the ground. It's sort of like with 16 and Pregnant. This show’s going to do the same thing. We've been making the show for nine months. Since then, so much has changed. Some people felt we were trying to exploit the problem. and half in Mexico. But over time, working with various groups, we lowered teenage pregnancy.
DEADLINE: Do you feel like there's still a lot of work to do?
It's that combination. We are leveraging our legacy IP but we’re also launching some new IP. McCARTHY: Content consumption continues to grow. We don’t look at it as either/or — it’s more.
For most of the 2010s, the onetime pop-culture supernova appeared to have burned out. Past Viacom regimes exacerbated the effects of MTV reaching middle age, focusing more on squeezing cable operators and buying back stock than on revitalizing the programming lineup. When McCarthy took over in late 2016 (just before Bob Bakish succeeded Philippe Dauman as CEO), MTV was practically an also-ran in the ratings.
Content consumption isn't going away. McCARTHY: It’s noise. We built a model for all platforms.” /> We didn’t build a model for cable. Regardless of who owns us and where we’re going, the one thing that matters is hit content and a strong brand.
The quarter ending in December was the sixth in a row when primetime ratings grew in both the 18-to-34 demo as well as 18-to-49 — the longest such streak in 19 years. Now, as Viacom gets set to report its fiscal first-quarter earnings on Tuesday, the picture is much rosier. Last summer, the company also launched MTV Studios, a production outfit that hit the ground running with a Facebook Watch deal for a reboot of The Real World. McCarthy has zeroed in on unscripted content, successfully rebooting mainstays like Jersey Shore and launching new shows like Ex on the Beach.
DEADLINE: How do you hold your own against social networks and tech companies, which offer a lot of programming and have a lot more money to spend?
DEADLINE: MTV blazed the trail in the beginning. In that kind of environment, what do you see as MTV's advantages? Now, there are so many media outlets competing for the same audience.
DEADLINE: What's a good example of that approach?
But it’s just a piece — an important piece – of the ecosystem. We had to fix cable first. In this crowded landscape, it’s nearly impossible for brands to get to that level. In the U.S., MTV has 98% brand awareness — not specific to cable, but across all media. Cable is just the beginning. CHRIS McCARTHY: We start from a position of strength. It’s our largest arena, it’s where most of our dollars sit and it's our launchpad. So we do start from that position. There’s no question the world has changed.

WGA West Exec Director David Young Got “Significant Bonus” To Earn $1.1 Million Last Year

The financial statements show that several other top executives at the guild also received hefty pay raises last year. Assistant executive director Rebecca Kessinger got a $53,788 pay raise to boost her salary by 23.9% to $278,744, and chief financial officer Don Gor saw his salary rise $28,989 for a 12.1% increase to $268,266. Assistant executive director Charles Slocum, the guild’s next highest-paid staffer, got a $58,052 pay raise, boosting his salary by 20.9% to $335,927. Assistant executive director Lise Anderson got a $59,143 pay raise, increasing her salary by 25.8% to $288,566.
Goodman in a statement to Deadline. “The amount of David Young's compensation reported in the LM-2 represents a raise in his annual salary plus a significant one-time bonus, reflecting David's 12 years of outstanding service as our executive director,” said WGA West president David A.
By contrast, AMPTP president Carol Lombardini, with whom the guild leaders negotiate collective bargaining contracts, earned more than $1.9 million in 2016, according to financial documents the AMPTP filed with the IRS.
Department of Labor. EXCLUSIVE: David Young, the longtime executive director of the WGA West, received a hefty one-time bonus last year that raised his total annual compensation to $1.1 million, according to financial statements filed with the U.S.
David White, national executive director of SAG-AFTRA, was paid $662,196 during the reporting period ending April 30, 2017. WGA East executive director Lowell Peterson, whose membership is about half of the WGA West’s 10,215 current members, received a 9.3% pay raise last year – up $32,055 to $375,901 during the reporting period ending March 31, 2018.
As reported here, Viacom’s Philippe Dauman pulled down a cool $93 million in 2017, CBS’ Les Moonves was paid $69.6 million, Disney’s Bob Iger got $43.9 million, Discovery Communications’ David Zaslav earned $37.2 million, Fox’s Rupert Murdoch was paid $34.6 million, Comcast’s Brian Roberts made $33 million, and then-Time Warner boss Jeff Bewkes got $32.6 million.” /> The union leaders’ pay is also dwarfed by the salaries of Hollywood’s top CEOs.
Young has been the guild’s top executive since 2006, and as Deadline first reported his contract was recently extended for another four years, with an option of two more years after that.
The guild's membership, meanwhile, received a 3% pay raise last year, earning a record $1.4 billion under guild contracts, according to the guild’s latest annual report.
During that same time frame, Russ Hollander, the DGA’s new national executive director, was paid $599,625. Before his retirement last year, DGA national executive director Jay Roth had been Hollywood’s highest paid, earning $813,638 during the reporting period ending December 31, 2017. Minus his one-time bonus, Young may still be only the third highest-paid labor leader in Hollywood.
The guild would not say, and the financial report does not indicate, how much of that $1.1 million was bonus and how much was his annual pay. In the prior reporting period ending March 31, 2017, Young received a salary of $573,032.