CBS Corp. CEO Predicts 'Extremely Strong' 2011 Upfront as Ad Rebound Continues
Leslie Moonves also says some in the industry see Netflix as "the anti-Christ," others see it as "the second coming" - "We are somewhere in the middle."
NEW YORK - CBS Corp. president and CEO Leslie Moonves on Tuesday touted the continuing advertising market rebound, saying ad prices for the first quarter of 2011 continue at recent growth rates and arguing this will bode well for next year's upfront market.
"This means the upfront should be even better [in 2011] than this year," Moonves said in trademark bullish fashion. "We expect an extremely strong upfront."
2010 has been "a fabulous year across the board" in terms of advertising, but first-quarter local ad pacings are equal to the trends of the third and fourth quarters, with TV ad prices up in the low 20 percent range and radio up in the single percentage digits, he told the UBS Global Media and Communications Conference in an afternoon keynote appearance. Network scatter market prices have been 35 percent above upfront levels in the back-half of 2010, and the trend is continuing into the first quarter as well, he added. "We're looking at a real rebound," he said.
He cautioned though that the company's total ad dollars face a tough comparison in TV next year because it is not an election year like 2010, and CBS won't have the Super Bowl. He didn't detail how much total TV ad dollars will be up or down compared to 2010 when taking that into account.
Moonves Tuesday touted the ratings of the CBS network as "sensational" and highlighted it has been number one in all demos, including the 18-49 group. "Things may change in the first quarter" though when Fox brings back American Idol, he acknowledged.
Moonves also chimed in on the debate over whether Netflix is a friend or foe of entertainment companies. Some CEOs see Netflix as "the anti-Christ," others see it as "the second coming," Moonves quipped. "We're somewhere in the middle" and will keep an eye on the company's future steps. Referencing a Monday comment from Time Warner CEO Jeff Bewkes that Netflix's offer for in-season TV shows is "measly," Moonves quipped: "I wouldn't make as bold a statement as that."
Commenting on the industry's continuing cord cutting debate, Moonves suggested most cable subscriber losses are due to people switching to satellite TV or telecom competitors. Importantly, he said, CBS Corp. will get paid by any and all those players since its popular content is available on all established distributors.
Asked about CBS Corp.'s digital strategy, Moonves acknowledged that the company has been "a little bit more cautious" in making content available than others in digital form. After all, "the motherload [of revenue] is still the network, is still syndication," he said, arguing there is no advantage to being first. "Our content is the family jewels...I'm proceeding cautiously."
Just because "we don't want to give up our content for zero," doesn't mean he has - like Google CEO Eric Schmidt has suggested - his head in the sand, Moonves said when asked why CBS hasn't made its online content available to Google TV.
Moonves also once again predicted that the CBS Films business will improve after a slow start. After a big loss on its first movie, the last two will "hopefully" break even, he said. "It's a tough nut to crack...I believe we will." Going slowly and focusing on movies with limited budgets has been the smart way to proceed, he said, quipping that he wants to wait until he has Twilight before he tries to do Clash of the Titans. "It's tough to be a little guy in this business," he concluded.
Moonves was also asked by an investor how much money there is in morning news shows given the recent reshuffle of The Early Show's on-air talent. The show will feature "a fresher, newer group" and "a fresher take on what the news is," even though there is unlikely to be an immediate major ratings boost, he said. But the show remains profitable and has improved its profitability as advertisers have been keen on buying morning shows, he said without detailing any figures.
Asked by The Hollywood Reporter after his speech about the future of Katie Couric after her contract expires next year, Moonves said there was no new development.
Moonves also drew laughs Tuesday when he mentioned how cost containment measures in scripted TV shows can be made in creative ways when actors ask for raises and it isn't known who will return for next season. He cited a family drama from the past that used an explosion to leave viewers guessing which on-screen characters were killed off and which ones would return in the new season. While that may sound cold, Moonves quipped to the Wall Street crowd: "You're business people. You understand."