Moonves sees growth for CBS

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NEW YORK -- CBS Corp. president and CEO Leslie Moonves signaled Thursday that serious labor talks could resume shortly and that the writers strike could be resolved in the "coming months."

Moonves also argued that the strike won't hurt his company's bottom line over the near- to midterm despite investor concerns, that the TV-centric company was particularly vulnerable.

"I can tell you there are some steps that are being taken to push that ahead," he told the annual Citi Global Entertainment, Media & Telecommunications Conference in Phoenix, but he didn't provide details on what steps his company and industry peers are looking at.

Moonves also spoke out against cash make-goods for advertisers, as well as saying that CBS Corp. hasn't seen any signs of a U.S. recession and will benefit more so than any of its peers from political ad spending in the primary season.

He also promised that all his company's divisions will grow this year, including its long-challenged radio unit. Moonves told investors that CBS will see 2008 growth in "every single division. ... The fundamentals of all our businesses are sound." He predicted the biggest revenue growth in the interactive space this year.

Like many industry executives in recent days, Moonves was asked about a possible U.S. recession. "As we look toward a potential downturn in the economy, we haven't seen any evidence of it ... including in our local businesses," he told investors.

He added that a recession should be hitting small local media markets the hardest, but CBS should be insulated from such pain given its presence in many larger markets.

Moonves said the writers strike "is bothering me a great deal," both professionally and personally. However, he shrugged off Wall Street concerns that the labor dispute is hurting CBS more than its peers, saying it will not affect the company's bottom line "in the short term and the medium term." After all, lower ratings and resulting lower revenue will be more than offset by reduced costs, he said.

While he wouldn't rule out that CBS might have to offer make-goods to advertisers if its ratings are affected by the strike, Moonves said he was "perplexed" that NBC recently paid advertisers cash as make-goods. "It's something we'd never do," he said.

Asked if the writers strike could be resolved in the coming months before hurting CBS, Moonves said he is "guardedly optimistic" it will be history by then.

In regard to how much in political ad spending CBS Corp. could garner this year, Moonves cited a target of about 10% of what is estimated to be a market of about $3 billion.

The fact that Democratic presidential hopefuls are locked in a tough battle is "a phenomenal situation" for TV station owners in big markets, he said.

He also reiterated that his company's CBS Radio unit for the first time will make a splash in the political ad market. "I am extremely encouraged by what we have seen so far," he said without providing more specifics.

Also at the Citi conference Thursday, David Maisel, executive vp office of the CEO at Marvel Entertainment and chairman of the company's Marvel Studios unit, was asked about the writers strike's impact on his company's strategy to release its own films.

This year's tentpole releases "Iron Man" and "The Incredible Hulk" already are in postproduction and therefore not affected, he said. However, "it does impact our development for future films," even though it is too early to say whether any 2009 releases will be pushed back, Maisel said.

If the strike goes on for a few more months, delays could indeed happen, he said.

Maisel also told investors that a planned Broadway version of "Spider-Man" is unlikely to premiere this year, but is likely a 2009 event.

Overall, he said Marvel sees "significant possibilities for growth" from its new film strategy, international expansion and the digital business.
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