Viacom CEO Defends Nickelodeon's Netflix Deal Again

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Discussing the kids TV network's ratings declines, he tells analysts that the channel is "poised to become bigger and better than ever."

Viacom CEO Philippe Dauman on Thursday defended digital licensing deals that his company has struck with the likes of Netflix for its cable networks, particularly Nickelodeon, amid suggestions that they have affected ratings.

Just on Wednesday, Time Warner CEO Jeffrey Bewkes had cited ratings gains for his Cartoon Network and became the latest to argue that Netflix availability of Nickelodeon content, such as iCarly and SpongeBob SquarePants, was hurting the network.

When analysts questioned Dauman about the issue during Viacom's quarterly earnings conference call, he said, "We are getting nice revenues through these subscription VOD deals."

Dauman pointed out that Netflix is in fewer than a quarter of U.S. households, and time spent on Nickelodeon content on Netflix is about 2 percent of the time spent on the Nickelodeon TV channel. The CEO said that this viewing "of course" is not "completely cannibalistic," has promotional value and serves audiences on new platforms. And he highlighted that Nickelodeon only has "some library content" on the streaming service.

Asked to explain what alternative reasons he sees for Nickelodeon's ratings declines, Dauman said things are "complicated," but he mentioned strong programming from competitors as one factor and reiterated that Nielsen ratings problems are also a key contributor.

One analyst asked if the Nickelodeon ratings declines aren't unprecedented. “We’ve seen this level of impact on other major networks in the past, and we have overcome it," Dauman said.

How will the network look to grow viewers again? While there is no silver bullet, Dauman said his team is investing in new original episodes and shows to reverse the Nickelodeon viewership slide. In the current fiscal year, Viacom's media networks are launching and developing more original programming than ever before, he said.

Nickelodeon has remained the number one cable network despite its challenges, and it is "poised to become bigger and better than ever," the Viacom CEO vowed. "The [content] pipeline is extremely strong."

Discussing the upcoming upfront advertising selling season, Dauman predicted "we will do quite well in the kids upfront."


Twitter: @georgszalai