Viacom

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Viacom, Inc.
Type	Public (NYSE: VIAB, VNV)
Founded	1971 (as Video and Audio Communications, Inc.) New VIACOM founded in 2006[1]
Headquarters	New York, New York, USA
Key people	Sumner Redstone, Chairman (through National Amusements, owns a controlling amount of voting shares) Philippe Dauman, President & CEO
Industry	Cable TV, Motion Pictures
Products	MTV, Nickelodeon, BET, more...
Revenue	▲$9.609 Billion USD (2005)[1]
Net income	▲$1.256 Billion USD (2005)
Employees	9,500 (2006)
Website	www.viacom.com

Viacom (NYSE: VIA) (NYSE: VIAb), short for "Video & Audio Communications", is an American media conglomerate with various worldwide interests in cable and satellite television networks (MTV Networks and BET), and movie production and distribution (the Paramount Pictures and DreamWorks movie studios). Sumner Redstone is the Chairman and, through National Amusements, the majority shareholder.

The new Viacom (legal successor to the former Gulf+Western/Paramount Communications) is considered to be the "high-growth" side of the much larger former Viacom. The former Viacom was renamed CBS Corporation, from which this firm was split off on December 31, 2005. CBS, not Viacom, retains control of the over-the-air broadcasting, TV production, and publishing assets formerly owned by the larger company. However, National Amusements remains the common majority shareholder of both firms.

[edit] History

In March 2005, the prior Viacom (now known as CBS Corporation) announced plans of looking into splitting the company into two publicly traded companies. The company was not only dealing with a stagnating stock price, but also the rivalry between Leslie Moonves and Tom Freston, longtime heads of CBS and MTV Networks respectively.

After the departure of Mel Karmazin in 2004, Redstone, who served as Chairman and Chief Executive Officer, decided to split the offices of President and Chief Operating Officer between Moonves and Freston. Redstone was set to retire in the near future, and a split would be a creative solution to the matter of replacing him.

The split was approved by Viacom's board June 14, 2005, approved December 31, 2005, and effectively undid the Viacom/CBS merger of 1999. The original Viacom changed its name to CBS Corporation and is headed by Moonves. It now includes Viacom's "slow growth businesses", namely CBS, The CW (formerly The WB and UPN), CBS Radio, Simon & Schuster, CBS Outdoor, Showtime, CBS Records, CBS Paramount Television and most television production assets.

These, according to some analysts, were suffocating the growth of the MTV Networks cable businesses (the split was structured such that CBS Corporation is actually the company previously known as Viacom). At the time of the split, CBS Corporation was also given control of Paramount Parks. CBS sold Paramount Parks to amusement parks management company Cedar Fair, L.P. on June 30, 2006.

A new company, the present Viacom, was also spun-off and was headed by Freston. It is comprised of MTV Networks, BET Networks, Paramount's movie studio, and Paramount Pictures' home entertainment operations. These businesses are categorized as the high-growth businesses (MTV Networks and BET Networks in particular), and if they were split into a separate company, it could infuse new capital to allow for future acquisitions and expansion.

Sumner Redstone still controls 71 percent of the voting stock of both companies and is the chairman of both companies.

[edit] 2005

In June, Viacom announced its purchase of Neopets, a virtual pet website. That December, Paramount announced it would acquire DreamWorks. All indications are that the whole of DreamWorks - both live-action film and TV studios, albeit not the DreamWorks archive - which was sold to a group led by George Soros in March 2006 - (nor the animated unit, which was not part of the deal) will remain owned by Viacom, even though CBS acquired Paramount's own TV studio.

[edit] 2006

On February 1, Paramount completed its long-awaited acquisition of DreamWorks. As of April 24, Viacom has obtained Xfire. In August, just hours before announcing its most recent quarterly earnings, Viacom announced that it had acquired Atom Entertainment for $200 million. In September, Viacom acquired game developer Harmonix for $175 million dollars.

[edit] 2007

In February, Viacom ordered leaked copyrighted video clips be taken off of the videosharing service YouTube due to claims of noncompensation for the violation of their own copyright. On February 21, Viacom publicly announced they would be offering free online access to their own material through Silicon Valley's distributor Joost thanks to a thorough content licensing deal.

On May 21, Viacom entered into a 50-50 joint venture with Indian media company Global Broadcast News to form Viacom-18 which will house Viacom's existing channels in India - MTV, VH1 and Nick as well as Network 18's Bollywood movie business. All future Viacom content for India and new ventures such as a Hindi entertainment channel and a Hindi movie channel would be housed in this JV.

On December 19, Viacom signed a five year, $500 million contract with Microsoft that included content sharing and advertisement. The deal allowed Microsoft to license many shows from Viacom owned cable television and film studios for use on Xbox Live and MSN. The deal also made Viacom a preferred publisher partner for casual game development and distribution through MSN and Windows. On the advertisement side of the deal, Microsoft's Atlas ad-serving division became the exclusive provider of previously unsold advertising inventory on Viacom owned web sites. Also, Microsoft also purchased a large amount of advertising on Viacom owned broadcasts and online networks. Finally, Microsoft will also collaborate on promotions and sponsorships for MTV and BET award shows, two Viacom owned cable networks.^[2]

[edit] Copyright complaints against YouTube

In February 2007, Viacom sent upwards of 100,000 DMCA takedown notices to the video-sharing site YouTube, alleging large-scale copyright infringement. Of the 100,000, approximately 60 - 70 non-infringing videos were erroneously removed under the auspices of copyright infringement.^[3]

On March 13, 2007, Viacom filed a US $1 billion lawsuit against Google and YouTube alleging massive copyright infringement, alleging that users frequently uploaded copyrighted material to YouTube - enough to cause a hit in revenue for Viacom and a gain in advertisement revenue for YouTube.^[4]

The complaint contends that almost 160,000 unauthorized clips of Viacom’s programming have been available on YouTube and that these clips had been viewed more than 1.5 billion times.

[edit] Controversial Complaints

In 2007 Viacom, claiming copyright infringment, requested the removal of a Youtube video that contained a part of their show, Web Junk 2.0, which featured a video from Youtube that Viacom allegedly used without permission. Christopher Knight, the creator of the video, wrote in a blog post: "So Viacom took a video that I had made for non-profit purposes and without trying to acquire my permission, used it in a for-profit broadcast. And then when I made a YouTube clip of what they did with my material, they charged me with copyright infringement and had YouTube pull the clip. Folks, this is, as we say down here in the south, ‘bass-ackwards.'"^[5]

[edit] Viacom International

Main article: Viacom International

As with the old Viacom, the current company owns Viacom International, which is the formal owner of copyrights associated with Viacom's corporate website and its cable networks. This division now owns the rights to a majority of Elvis Presley films made for Paramount Pictures, such as Blue Hawaii and King Creole.

It also continues to focus on its own in-house productions made for its various networks (MTV, VH1, Nickelodeon, etc.) – these programs include Dora the Explorer, Wow! Wow! Wubbzy!, LazyTown, SpongeBob SquarePants, Catscratch, The Hills and Behind The Music.

Viacom also owns Comedy Central, which runs Stephen Colbert's The Colbert Report. Colbert has often made fun of Viacom for several reasons, and even, after claiming he won the 360M$ lottery, said, over TV, to Sumner Redstone, "You don't own me anymore, old man!"^{[citation needed]}

[edit] Corporate governance

The previous board of directors of Viacom were George Abrams, Vincent Erazo, David Andelman, Joseph Califano, Jr., William Cohen, Philippe Dauman, Alan Greenberg, Charles Phillips, Shari Redstone, Sumner Redstone, Frederic Salerno, William Schwartz, and Robert D. Walter.

Following the Viacom/CBS split, the Viacom board consisted of George Abrams, Philippe Dauman, Thomas E. Dooley, Tom Freston, Ellen V. Futter, Robert Kraft, Alan Greenberg, Charles Phillips, Sumner Redstone (Chairman), Shari Redstone (non-executive Vice-Chair), Frederic Salerno, and William Schwartz.

As of September 5, 2006 Tom Freston has resigned from the company. He is replaced by Philippe P. Dauman.

[edit] Assets

This is a summary of the main Viacom divisions. For detailed assets see List of assets owned by Viacom.

• Film Production and Distribution: Viacom International, Paramount Pictures, DreamWorks, Republic Pictures, MTV Films, Nickelodeon Movies, Go Fish Pictures
• Television Networks: Comedy Central, Logo, BET, Spike, TV Land, Nick at Nite, Nickelodeon, Noggin, The N, Nick Jr., TEENick, MTV, VH1, MTV2, CMT, MHD
• Television Production and Television Distribution: DreamWorks Television
• Video Gaming: Xfire, Harmonix, GameTrailers, Neopets
• Internet Sites: Screwattack

[edit] Footnote

[edit] See also

• List of conglomerates
• Viacom (1971-2005)

[edit] External links

• Viacom website
• Ketupa.net - Viacom
• Viacom information by Hoover's
• Viacom profile by Yahoo!
• How logos of Viacom changed
• Split documentation - SEC filing on Form S-4 from October 5, 2005 describing the split.