In his introduction of Viacom (NYSE: VIA) CEO Philippe Dauman at an afternoon keynote at the McGraw-Hill Media Summit, Dauman’s interviewer Ron Grover, BusinessWeek’s LA bureau chief, offered some family history with the aid of a year-old LA Times piece. Back in 1996, Dauman’s father, a freelance photographer living in New York, noticed that a Life magazine photo he had taken was used by the late Andy Warhol in a painting. Seeing that the Warhol painting had sold for over $400,000, the elder Dauman promptly sued the artist’s estate, which eventually settled. Like father like son: Dauman’s Viacom sued Google for copyright infringement over YouTube’s unauthorized use of content from its cable programs.
— Family matters: An hour into the conversation, Grover got to the issue of Viacom’s $1 billion suit against Google (NSDQ: GOOG). Dauman: “We’re in litigation-land, we’re still going through discovery. With technology, there are more documents [to be examined]. We’re confident in our position and that there will be an outcome someday. We’ve already achieved a number of things with this lawsuit. It took a long time, but because of our actions, YouTube has moved in the right direction — they’re where they should have been all along.”
Grover then asked if Google CEO Eric Schmidt is on Dauman’s speed dial. Dauman breathed in and smiled. “I’ve always had a cordial relationship with Eric, but we don’t talk everyday.” Interestingly, Dauman’s oldest son, Philippe Jr., now works for Google. In fact, he had his interview with the search giant just after the takedown notice was filed. “My son called me just after and said, ‘Dad I had a great interview with Google yesterday, but now they probably won’t hire me.’ I said, ‘They probably won’t.’ But they did and I gave them a lot of credit. He interviewed with a very senior person who knew who he was and he still got the job.”
What’s Philippe Jr.’s job? “Content acquisition. [Audience breaks out into laughter. Dauman starts laughing too before he clarifies] Local content, that is.”
— Comedy Central & CNBC: The beginning of the conversation avoided the contentious issue of copyright protection. Instead, Grover picked up from NBCU CEO Jeff Zucker’s comments earlier in the day on Jon Stewart’s pillorying of CNBC, Dauman said: “Jon Stewart… has a connection with the zeitgeist. The reason it got so much attention is because he spoke to what people were thinking about.” Grover: Any salary increase for Stewart? Dauman: “We treat him very well.” So how long will this back and forth between Stewart and Cramer continue? Until people are really tired of it, it seems. “Cramer is welcome on any of our channels. He hasn’t done Colbert Report yet.”
— Advertising: Advertising was only down 3 percent last year. All things considered, that’s not so bad, Grover noted. Dauman insisted that the kids’ upfront is off to a good start. But he didn’t offer much in the way CPMs might head this year, saying only, “Having great content always helps.”
— Cutting the cord: Citing Time Warner (NYSE: TWX) Cable chief Glenn Britt’s fears that consumers are “cutting the cable cord” by watching programming on TV, Dauman sought to make the case that such concerns are overblown. Putting shows online only reinforces the viewership that makes them more reliant on cable distribution. “We’re working with cable operators to make sure the consumer gets what they want in a way that works well for both the content companies and distributors. We all need to make money. Talent likes to be rewarded and these shows cost money.” Dauman avoided directly answering Grover’s questions about TWC’s and Comcast’s plans to offer direct online programming to their cable subscribers. He didn’t say he was opposed to such a service, and insisted on the company’s receptivity to a variety of plans to make money from their content.
— Revenue models: Dauman: There’s a lot of experimentation going on and in a few years, cable channels will get subscription revenue, as well as merchandising. Gaming is an interesting area and Rock Band will give us more of a presence online. As technology improves, it will allow for additional revenue streams.
— How much digital rev? Not telling: Back in 2007, Dauman often predicted that Viacom would hit $500 million in digital revenue. Grover tried to get him to answer whether the company achieved that goal. Dauman hesitated a bit and clammed up, saying the company will not break out digital revenues. The rationale: “Digital has become an integral part of our shows. We have 300 separate sites, some related to Comedy Central and MTV in general, and some to specific shows. And we are deriving revenues from shows on a variety of formats, not just sales in one area. So it doesn’t make sense to look at that one sliver. Digital and cable work hand in hand, not separately.”
— DVD biz: Sales will shrink and that includes Blue-Ray, but we’ll still sell a lot of the big titles, like Iron Man.
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