The biggest talking point in negotiations between programmers and cable operators is the notion of a network’s value. And Viacom may now have more to talk about, if its second-quarter results are any indication. The strength of Viacom’s cable division, which includes MTV Networks and Black Entertainment Television, helped propel the company to its best-ever second quarter. Revenue from its cable networks rose 22% to $1.35 billion, while operating income before depreciation and amortization increased 28% to $541 million. (Results for the quarter reflect its full ownership of Comedy Central; the company paid $1.2 billion in May to acquire AOL Time Warner’s 50% stake.) Viacom reported robust advertising sales, with ad revenue for its cable brands up 31%, of which 7% is attributable to Comedy Central. MTV Networks increased 33% while BET had a 15% increase in ad sales. Overall, its ad revenue was up 11% including Comedy Central, or 9.5% without. Affiliate revenue was also up 10%, or 8.5% without its newest cable network. Viacom executives stressed their ongoing commitment to investing in original programming, pointing to programs such as Stripperella, one of the signature shows driving TNN’s Aug. 11 rebranding as Spike TV. So while TNN saw double-digit revenue growth in the quarter, it also saw double-digit increases in expenses, primarily for programming costs along with ad sales, commissions and bonus increases. “[We] have the most profitable portfolio of cable networks in the business,” said Mel Karmazin, Viacom’s president and COO, last week during the earnings call. Viacom generated a quarter of all TV viewing in the quarter, with a 26 share of audience for its aggregated networks — cable and broadcast — in prime time. “That is real important for lots of reasons, including dealing with advertisers as well as dealing with our cable partners,” he noted. He spoke to the quarter’s “great rating performance,” such as the 69% ratings growth at VH1 and Nickelodeon’s 31 consecutive quarters at the top of the ratings. TNN’s Spike Lee-delayed rebranding in June didn’t hurt its ratings for its new shows, Karmazin added: “It’s already tied No. 1 in men 18 to 34.” He also singled out CMT, TV Land, BET and Showtime as doing “extraordinarily well.” Viacom’s upfront business saw a 21% increase in dollars for its cable networks, compared with 15% for its broadcast networks and 33% for syndication. Its total upfront is 19% higher than last year. “Third-quarter options are still very low,” he added, “and third-quarter pacing for [our] cable networks is strong.” Second-quarter scatter pricing was up “25% to 40% across all dayparts, [and] cancellation options were very low with approximately 7% in prime.” The bottom line, said Karmazin: “Great brands, great execution, topline growth, picking up market share, margin improvement, great free cash flow.”

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FCC Seeks Comment on NAB NextGen Petition

The FCC Media Bureau is seeking comment on NAB’s petition regarding the treatment of multicast streams under the NexGen TV local simulcasting rules.

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