Viacom CEO Philippe Dauman says he thinks that changes in the cable industry, including the acquisition of Cablevision Systems by Altice, will help stem the erosion of pay TV subscribers in the U.S.
Dauman also said that as Viacom’s new ad products kick in, its networks might be able to reduce their commercial loads.
“When you look at someone like Patrick [Drahi, chairman of Altice], who is coming into the market, who we do business with outside the U.S. already, I think his coming in is going to be a real positive force here,” Dauman said Friday at the Goldman Sachs Communacopia conference.
“You can leverage technology across a broader scale and presumably roll up some of the smaller players who couldn’t make that kind of investment, that will again improve the ecosystem in those parts of the country that are being rolled up,” he said.
Dauman said networks are spending more on programming and operators are making investments to improve their products.
“The opportunity is there again by satisfying consumers and having a better consumer interface, which we’re working with our partners on, with having better VOD capability, and all the other products that particularly young consumers are looking for,” Dauman said. “There’s an opportunity for stabilization and ultimately potential for growth.”
He said that Charter and Time Warner Cable getting together also offered an upside. “Already they’ve all accelerated their investment and recognized that that’s been one of the factors over the last several years in the slow erosion that’s taken place in the subscriber base,” he said.
Dauman insisted that people are “totally overplaying” the cord-cutting issue. “There’s not a material acceleration of what has been a modest decline in subscribers over the last couple of years. In fact in certain segments, like the cable companies, we’re seeing stabilization on the cable company part of the MVPD universe,” he said.
Viacom’s ad revenue has been under pressure because of lower ratings. Dauman stressed that while ratings are down, viewership is up and that Viacom has rolled out a series of products designed to help advertisers capture viewer engagement on digital, mobile and social platforms.
He said products like Viacom Vantage were a major driver in the upfront and that those initiatives will be taking effect during the new broadcast season.
“With those kicking in we’ll be in a position—we’ve been talking to a lot of advertisers about it, which they like—to reduce ad load in primetime across our networks, which will improve the consumer experience and drive pricing.”
As ratings and ad revenues dropped, many cable networks including Viacom have been stuffing their programming with increasing ad loads.
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