August 14, 2019
Corporate synergy and scale are two key economic points underscoring the $30 billion re-merger of Viacom with CBS.
Speaking Aug. 14 with CNBC, Robert Bakish, current Viacom CEO and future head of the renamed ViacomCBS, said the combined media company would offer “unmatched scale” with 140,000 television catalog episodes and 3,600 movies, including content from Paramount Pictures and CBS Studios.
Bakish said CBS’ early move toward direct-to-consumer content distribution with CBS All Access and Showtime OTT, and Viacom’s acquisition of ad-supported VOD service Pluto TV well-positioned the rebooted media company in the in the streaming video era .
“[That’s] not something people have talked about a lot [regarding the merger],” he said. “You unite those two together and you really have a D-to-C ecosystem. Very compelling, both with substantial — millions of users.”
When asked whether ViacomCBS could successfully match Disney, Netflix or WarnerMedia, Bakish said scale could be viewed subjectively.
“Between the studios that we operate, Paramount, CBS Television Studios, Nickelodeon Animation and Viacom International Studios, we have 750 series ordered or in production. There is true content scale here,” he said.
“There’s no question the companies are stronger together than they were independently. And, you know, we’re going to start executing with that.”
The executive defended the companies’ downward revised cost savings from $1 billion to $500 million.
“This is excluding programming, excluding marketing, excluding revenue. So, there’s a very material opportunity. And as we get into it we’ll move forward and begin to realize that [cost saving],” Bakish said.
The initial pushback on the deal from former CEO Les Moonves disappeared following the executive’s ouster due to #MeToo allegations.
Bakish contends the cultures at Viacom and CBS have a lot in common — with both companies focused the content creation and distribution.
“An employee of CBS News loves CBS News, just like an employee at MTV loves MTV,” he said. “There’s incredible value in the combination. You look at the strategy we’re going to start executing against. Building a real leadership position in D-to-C through this combination of subscription product and ad-supported product. This ecosystem, tremendous opportunity there. You look at expanding the partnerships and building new partnerships with advertisers, with distributors. Tremendous opportunity there for all of the people that work in that area. You look at being one of the most significant content suppliers in the world. Tremendous opportunity there. So, I think very quickly this culture will come together.”
With Moonves out, former CFO Joe Ianniello has held the acting CEO position. Following closure of the merger, he will become CEO of CBS, reporting to Bakish.
Ianniello reportedly has a clause in his employment contract paying him $70 million severance should he not retain the top executive job.
“I’ve known Joe Ianniello for 20 years,” Bakish said. “I have tremendous respect for what he’s done at CBS. He’s clearly a world class executive. He and I have spoken a lot in the days leading up to yesterday. And including yesterday. And there is a tremendous interest, joint interest, in unlocking the value of these combined companies.”
Bakish said Ianniello would take the leadership position, running the CBS branded assets upon closing.
“We need someone to run those assets,” he said. That’s a big complicated business. He is ideally suited to do it because he has, you know, 20 years of knowledge in that space and a real passion for it. At the same time, he knows that we have to create value from these assets. We are going to have to work across the company. He’s 100% committed to it and I can’t wait to get on with it with him.”