NEW YORK -- The only victory sweeter for Leslie Moonves than seeing CBS dominate the coveted Thursday primetime ratings or snaring NBC anchor Katie Couric to revitalize his network's evening news would be reinventing the broadcast network business model for the digital broadband age.

A decade after he joined CBS as entertainment president, Moonves is about to get his chance. The one-time actor who took CBS from worst to first among the Big Four networks is preparing for his close-up on the CEO stage as of Jan. 1, when the split with Viacom leaves him solo as president and chief executive of the $32 billion CBS Corp.

The stakes are high for the first major pure-play broadcaster to emerge in more than a decade. Where others see a seriously challenged broadcasting industry business model, Moonves, a driven optimist, sees hot CBS-branded content flowing through new digital broadband, wireless and cable pipelines, supported by its core TV, radio and outdoor advertising businesses.

"We have growth options, and I think we're going to surprise a lot of people," Moonves says. "Our future success will depend on maximizing the use of our great entertainment, news and sports content everywhere and being paid for it."

As he dives into an array of new-media licensing deals, Moonves' overriding concern is making sure that CBS is well compensated for its programming and the value conferred by the Tiffany brand.

Like its rivals, CBS is making rapid-fire content deals with every kind of distributor: Verizon's V Cast video, Comcast video-on-demand, iPod audio and others. In most cases, CBS receives the lion's share of the on-demand user fees for providing select program clips (as for Verizon cell phones) and full-length series with TV commercials intact (as with Comcast VOD), well-placed sources say. CBS also gets a critical first read on the impact new-media options will have on its core businesses, consumer and advertiser behavior and its balance sheet.

"It's no coincidence that ABC and iPod, NBC and DirecTV and CBS and Comcast got together all within a few months to talk about these first deals, which will replicate themselves," Moonves says. "It's fair to say the Comcast deal is only a precursor of things to come. These are baby steps into the world of new media from the existing content of old media."

Although CBS Corp. is highly susceptible to economic swings that can affect the advertising sales comprising 70% of its revenue, Moonves is bent on exploiting the company's dominance in broadcast and outdoor advertising in the nation's largest, most lucrative markets -- particularly through Internet extensions.

"With 39 TV stations, 179 radio stations and a huge outdoor business, we're talking about local connections," Moonves says. For the first time, CBS Corp. will collectively sell the TV, radio, outdoor and corresponding online platforms to local and regional advertisers. "That will be a very potent growth force," he says.

Morgan Stanley analyst Richard Bilotti contends that the market "underestimates" CBS' postsplit growth opportunities, which are not reflected in its interim "when issued" stock price of about $26 per share, being manipulated more by arbitrageurs (since mutual funds can't participate at this point). Many analysts expect CBS Corp.'s postsplit stock to eventually trade at between $32-$35 per share. CBS is enticing investors, who are cool to slow-growing broadcast stocks, with at least $450 million in annual dividends and an anticipated $1 billion in stock buybacks.

Although CBS will exceed long-term secular trends with an estimated 10%-11% growth in earnings before interest and taxes next year driven by its television production, syndication and outdoor businesses, that growth rate will fall to less than 7% annually by the end of the decade, Bilotti wrote.

Characteristically, Moonves is far more bullish on CBS' future.

"I don't believe old media is dead," he says. "The CBS television network and our stations are making more money every single year and will continue to. The radio business makes us a lot of money. New media is exciting, but it's still not going to be our bread and butter for a long time. It's going to be our gravy."

However, industry analysts point to CBS Corp.'s vulnerability on a number of fronts. Howard Stern's defection to satellite radio next year will prompt the loss of $100 million, or 5% of total revenue, against flat growth at CBS Radio (formerly Infinity Broadcasting), though the division's cost structure also will go down with the departure of the high-priced shock jock.

CBS Corp. will have nearly three-quarters of the old Viacom debt (at least $7 billion) supported by only 65% of its revenue and 55% of its earnings. CBS' all-important ability to convert earnings to free cash flow to reinvest in its businesses could decline by one-fourth to mid-30% -- a prospect Moonves says he doesn't completely buy.

Even more critical is that "CBS' financial results may be approaching peak levels," according to Bernstein Research analyst Michael Nathanson, citing the limited demand for network TV advertising, local TV's over-reliance on waning auto industry sales and limited regulatory growth catalysts. Nathanson's low-end forecasts of CBS' long-term 4% revenue growth and 3% operating profit growth "may not be bearish enough," he wrote in a recent report.

CBS' core businesses are subject to new competitive and cyclical erosion. The 41% of revenue tied to television advertising is under pressure from audience erosion by cable, Internet, video games, DVDs and other new-media options. The 35% of revenue tied to radio faces increased pressure from satellite radio and iPod-like devices.

The ratings turnaround during Moonves' tenure, in the face of eroding broadcast TV fundamentals, only yielded a modest 1.7% compounded growth in revenue and 4.5% growth in earnings before interest taxes, depreciation and amortization, Nathanson estimates. Viacom declines to break out CBS' historical financial data.

Then there are such slippery financial matters as CBS possibly having to commit to a $100 million, five-year contract with Couric to help revive its beleaguered "CBS Evening News" franchise; testing new business models with its 240 TV station affiliates that eventually could include reverse compensation; testing new forms of advertising without jeopardizing conventional forms; and having to invest more than half its annual $14 billion revenue on all forms of content.

Still, analysts say CBS' balance sheet will be strengthened by continued frugal cost management, especially in corporate overhead and at Showtime. It could raise more than $1.5 billion from the anticipated sale of Simon & Schuster publishing and the Viacom theme parks, relics of past expansion deals that it also is inheriting.

Moonves is unwaveringly confident about his close-knit management team's ability to generate hot properties in whatever media space they decide to conquer. He is a digital convert, determined to use the array of emerging platforms to take CBS to a new level, as he discussed during a wide-ranging interview in his expansive corner office at Black Rock that once belonged to CBS founder William Paley.

"What we discovered from TiVo is that people who use TiVo watch 60% more television. So, I'm not losing viewers, I'm gaining viewers. The same with the Internet and with VOD," Moonves says. "I'm benefiting from all the additional people who become more familiar with my entertainment programming, my news, my sports, my network and my personalities. It all works hand in hand."

As an example, CBS has its first $1 billion franchise in "CSI: Crime Scene Investigation" and its spinoff series as a result of first-run and off-network advertising, DVD and video-on-demand sales and all kinds of merchandising.

"You see what happens when one little program is spun off in 27 different ways? That's what is exciting about the future," Moonves says.

Under pressure to join ABC, NBC and Fox in supplying programs to Apple's video iPod, CBS also is in discussions with Google, as well as other portals such as Yahoo! and America Online, about on-demand content and search arrangements.

Most important, CBS' existing content sliced, diced and repackaged for cell phones, digital channels, VOD, Internet streaming, podcasting and other new platforms generate incremental revenue from subscriptions, license fees and advertising that fall straight to the bottom line.

"I'm looking at each one of these things as a real additive," Moonves says.

Cable is one distribution platform where CBS could be gearing up for a fight. At present, the MTV Networks channels that are staying on the opposite side of the Viacom-CBS split are paid a retransmission fee, part of which is shared with the CBS network. That no longer will be possible in postsplit deals negotiated by the new Viacom and its MTV Networks properties.

Although CBS' existing carriage agreements with cable operators will not expire for four years, it is forging a new Internet video game plan, known as a "cable bypass," under the command of Larry Kramer, president of the newly formed CBS Digital Media unit and founder of the respected financial news Web site MarketWatch.

CBS soon is expected to announce cash-carriage agreements with telephone companies aggressively competing with cable and satellite for video turf and willing to pay. An early analysis suggests top-rated broadcast networks might be worth between 60 cents-$2 per cable subscriber. The burgeoning on-demand new-media arrangements also will shape values and fees while reducing broadcasters' dependence on cable.

But Google and Yahoo! might get there first.

Ongoing discussions with both have been heightened by the success of a barely promoted carriage of the Paramount Network TV-produced UPN series "Everybody Hates Chris" this fall that attracted 120,000 Google users. Other such arrangements are planned. When initially approached with the proposition, Yahoo! insisted CBS would have to pay for the carriage. Google was willing to give it a try for free, sources say. Yahoo!, which declined comment, is not able to technically handle the broadcast networks' bulk on-demand video offerings until spring. CBS.com is frequently a top online broadcast destination, according to Nielsen//NetRatings.

"The Google trial has been a great leveler for us in dealing with all of the online portals about carrying our content," Moonves says.

Some analysts estimate that new-media proceeds collectively contributing less than 5% to CBS Corp.'s total revenue today will more than quadruple by decade's end, accounting for as much as 15% of total revenue.

A recent CBS survey estimates that the Big Four broadcast networks could collectively reap as much as $5 billion annually as early as the end of next year from selling their primetime content on-demand and other new media, helping to offset shifting TV ad revenue.

Beginning in January, CBS will make four primetime series available to Comcast VOD as 99 cent downloads the day after they air. CBS already provides select programs including "60 Minutes" and "Guiding Light" to the audio iPod. As with other new broadcast network arrangements, distributors and device makers will underwrite most of the marketing for these offerings.

"The VOD Comcast subscriber will see the entire show as you would see it on CBS, complete with all the commercials," Moonves says. "We get paid by how many people view a show. So if 500,000 more people view a show on VOD, they hopefully will be added to our audience reach as figured by Nielsen. We have everything to gain," Moonves says.

The recently announced free online ad-supported streaming of out-of-market NCAA men's basketball tournament games (involving CBSsportsline.com, NCAAsports.com and CSTV.com) reflects CBS' newly adopted Internet broadband strategy and the broad new-media terms on which broadcast networks acquire all kinds of licensing rights these days.

As a stand-alone broadcaster, the new CBS Corp. has taken its first steps into cable ownership by acquiring College Sports Television for $325 million in stock. The addition of CSTV.com puts the size of CBS' online sports audience on par with ESPN.com, providing a fortified platform of targeted advertising and content for die-hard fans. The 24-hour, content-rich expansion this year of CBSsportsline.com, as well as CBSNews.com, has been key.

It has fueled speculation that it will launch a string of new cable services, drawing on CBS' owned content, including more than 3,000 titles in the CBS and Paramount television libraries. Moonves says that more likely will occur after next year, when CBS is closer to renegotiating retransmission agreements with major cable operators and will be able to secure carriage for new cable offerings as well as expand the reach of Showtime, foreign-language offerings of which are exploding in overseas market.

The company has been eyeing other cable network acquisitions (including Crown Media Holdings' Hallmark Channel) on which it could spend more than 10% of its free cash flow (after dividends, share repurchases and pension liabilities), Bilotti estimates.

"We are not looking for any transforming acquisitions," Moonves insists.

"We purchased CSTV because it fits terrifically well with our already existing content like the NCAA basketball tournament and the CBS Sportsline Web site. The CSTV cable channel and links to 250 college Web sites will be key in selling merchandise," Moonves says.

"But I don't see us launching a network of sports channels. I think ESPN does that pretty well. I don't see us starting a cable news channel, although we have a great news infrastructure, and I would aggressively bid for CNN if it was for sale," he says.

"We don't have to get into cable in a bigger way. We have Showtime, in which we've already made some creative changes. It provides an interesting opportunity in contrast to its other core businesses. We are going to follow HBO's lead and do more cutting-edge original production," Moonves says.

Other organic growth includes the creation of original content for new-media platforms and plans to launch the general entertainment digital broadband network, CBS 2, by 2007, drawing on existing and archived content and program contributions from local TV affiliates.

Whether on its own or other broadband networks, CBS will concentrate on on-demand options: from the more comprehensive likes of the $99 summerlong "Big Brother" rebroadcasts streamed by RealNetworks ("We made decent money on that," Moonves says) to the abbreviated clips of primetime, news and sports programming for Verizon's V Cast.

"It's not hard to imagine that there is something possible with every show and every business model," Moonves says. "Two years from now, I think you'll be standing on a sidewalk somewhere and be able to watch the tribal counsel on 'Survivor" and be able to vote on who you want in from your cell phone or from a gas station kiosk."

Next year, CBS will be deep into experimental shortform content, including three-minute 'Survivor' games, sports replays and interactive surveys. "We're still in laboratory stages of lots of things," he says.

More routinely, CBS will begin the more aggressive DVD release of its TV archives, and spike its off-network syndication with series such as "Medium" and "NCIS." CBS and Showtime also will realize improved economics from sharing repurposed and original content. Moonves says the accelerated new- and traditional media activity will not take the edge off of network TV viewing.

"It all plays to a different audience than our primetime viewers. There are still huge advantages to appointment television and big events," he says. "What I like about us is that people need drama. They want entertainment, whether it's news, sports, comedy or drama. That's what we do. I don't care how we get it to them, as long as we get paid for our content," he says.