Fox, CBS unruffled by NBC Uni-Comcast deal

Top execs say they're not concerned about planned merger

NBC Universal needn't worry about a couple of its primary competitors trying to derail its merger with Comcast. It seems that Fox and CBS don't much care.

"From a macro perspective, I'm certainly not troubled by it," Chase Carey, News Corp.'s deputy chairman, president and COO, said Wednesday at the Milken Institute Global Conference.

"Being that NBC is in fourth place, we sort of don't like anything to change," CBS president and CEO Les Moonves joked.

"It will become a very powerful company," he continued. "There are other people out there that are worried that there may be some trade problems with that. I don't feel that way."

Moonves and Carey were speaking to a packed house during a discussion titled "The Business Behind the Show: Outlook for the Entertainment Industry." They were joined by Windsor Media chairman and CEO Terry Semel, Live Nation executive chairman Irving Azoff, Activision Blizzard president and CEO Robert Kotick and e5 Global Media CEO Richard Beckman. E5 is the parent of The Hollywood Reporter.

Also top of mind, at least for Carey and Moonves, was the trend of cablers paying retransmission fees to broadcast networks. Carey said the fees were "truly way past due."

"If broadcast is going to be competitive, it has to have a dual revenue stream," he said.

Said Moonves: "All I can say about that is, it's about time. The fact is that networks are finally getting paid what they deserve from the cable operators. In a previous life, we weren't getting credit for the quality of the programming we were putting on or the tremendous sports rights we were paying.

"It always bothered us that USA Network made more money for putting on reruns of 'NCIS' than we were for putting on the original show," he added.

"The line between cable channels and broadcast channels is blurring; most people -- certainly younger people -- don't know the difference," Moonves said.

Also blurring are movies and video games because of the latter embracing storytelling and character development, Kotick said.

"For the first time, being in Hollywood has incredible value to us," he said, noting that animators, screenwriters and others from the TV and movie industries also are crafting video games.

Kotick's company makes the "Guitar Hero" games that are introducing a new generation to classic rock bands and generating sales of their music. But Azoff said music labels might be leaving some money on the table.

"The biggest problem we've had is the case where the labels block us," he said. "Most of the artists want to expose themselves to the new audiences that 'Guitar Hero' brings."

He said the "archaic" system in place for intellectual property at record companies is better used for blocking rights than for granting them.

Concerning technology, the consensus was that 3D movies are no fad and that TV sets will be fully merged with the Internet in 10 years.

Semel suggested that someone should experiment with charging a subscription fee for viewing the most popular TV show -- or a couple of them -- online, lest audiences get too used to the idea that such content always should be free. It's an issue print media is grappling with, and it's a misconception that nearly crippled the recorded music industry.

Courtesy of the Internet, "Any idiot can become a content provider," Beckman said. "No barriers of entry, no quality control." Print-media companies must earn trust by filtering out the garbage, he said.

Meanwhile, consumers also have the power to cut out the advertisers' message in the digital age, further burdening the print industry.

Beckman said resistance to change is "frustrating," and trying new things that make good business sense is "liberating."

That topic also was discussed earlier in the day at a different panel when Huffington Post editor Arianna Huffington took Viacom's Sumner Redstone to task for his statement Monday that print newspapers are a dying industry.

"He's been wrong on many things, and this will be one of them," she said. "There's something in our DNA that wants to read newspapers."

During another panel Wednesday, producer Avi Arad said that Hollywood will do for video games what it has done for comic book superheroes.

"Very much like when we started with comics, we need one runaway success to make it very clear that this is a great source material," he said.

Thomas Tull, CEO of Legendary Pictures, which partnered with Warner Bros. on "The Dark Knight" and other blockbusters, agreed. No shock, considering that Legendary is partnering with Warners again on "Warcraft," based on the online role-playing game "World of Warcraft."

"Comic books for a while were kind of like the dregs of what can be made into movies," Tull said. "I happen to think that on the video game front a similar shift is going to happen.

"It's all about the storytelling. It's tough to make a movie about 'Pong,' " he quipped. "But some of the properties that have come out in the last couple of years are incredibly layered and complex."
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