Shari Redstone Says Viacom Would Have Lost "Momentum" by Merging With CBS
"Having a vision and a strategy was a new thing and it was an exciting thing," the vice chair of both media companies says of her turnaround efforts at Viacom.
Nearly six months after withdrawing her proposal for a merger between CBS and Viacom, Shari Redstone says it was the potential to resuscitate Viacom as a stand-alone business that ultimately scuttled the deal.
"What I saw very quickly was the energy that existed at Viacom," Redstone, president of controlling shareholder National Amusements and daughter of former CBS and Viacom chairman Sumner Redstone, said Wednesday night at the Code Conference in Ranchos Palos Verdes, Calif. She began to spend time with Bob Bakish, the longtime Viacom executive who was installed as CEO last year. "What I didn't understand at the time was the significant upside at our businesses once we had a management team in place," she explained.
Redstone, who serves as vice chair of both companies, continued: "Having a vision and a strategy was a new thing and it was an exciting thing. If we had done a merger at that time, the momentum we had built so quickly would have been lost."
The effort to turn around Viacom comes after a rocky few years for the media company, owner of Paramount, MTV and VH1. Last year, Redstone ousted her father's longtime lieutenant, Philippe Dauman, from his position leading the company and proposed that CBS and Viacom explore a possible merger, a deal that would have reunited the two companies more than 10 years after they split.
But in December, National Amusements withdrew the proposal. The Hollywood Reporter reported at the time that Redstone realized it would be difficult to settle on a price for the deal and that she was having trouble convincing CBS CEO Leslie Moonves, who was expected to assume leadership of the combined company, to take on the cost of a Viacom turnaround.
Asked about whether Moonves factored into the decision, Redstone on Wednesday answered indirectly, "I have a great relationship with Les, and I think we could have worked really well together on a combined company. The change for me was, 'Oh, my God, there is potential [at Viacom], there is opportunity here.'"
She pointed to opportunity at Viacom to produce shortform video and to build an entertainment skinny bundle that Bakish teased earlier this month. He has described it as a $10-$20 package that would offer entertainment content and said that Viacom was in discussions with one TV provider to offer such a bundle.
While that particular bundle would not include sports, Redstone noted the importance of live competitions for CBS, calling it "a great vertical to be in."
When asked about the ratings declines that NFL games experienced at the start of last season, the exec blamed it on market confusion. The games, she explained, were on "too many networks." And Redstone, a longtime New England Patriots fan, also noted that the four-game suspension of quarterback Tom Brady didn't help ratings: "Some of the stars weren't there in the beginning of the year."