CBS at Goldman Conference Notes

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Les Moonves

More people are watching TV they are just watching it differently

“I appreciated what the gentleman from comScore said, which we wholeheartedly endorse, that more people are watching television today than were watching 15 years ago. They are just watching it in different ways. They are watching it digitally, they are watching it through DVRs and once again we are now accounting them, we are getting paid for them. So the prospects for all those things I mentioned are very good.”

Have 2m OTT subs

“OTT we hit as we mentioned 2 million subs between the two of them this year. We also said by 2020, we expect to have 8 million, 4 million apiece. I think it’s very possible that number could be larger than that. A lot of it is going to be dependent on original content, which we have coming to All Access.”

China is opening up as a real media market

“the opening of China, frankly, before two years ago we were getting nickels and dimes and we used to fondly say that The Big Bang Theory is the number one watched show in China except nobody over here got paid a nickel for it. That it was just out and about and neither Warner Bros. nor CBS got any money for it. Now that marketplace really is opening up and, obviously, it’s a very, very large market.”

Trump isn’t spending as much on ads as people may have thought

“, we have no revenue warnings here. They are probably, to generalize, there’s probably not as much of the top of the ticket because Mr. Trump doesn’t appear to be spending as much as people may have thought. But down below in terms of senatorial, gubernatorial, congressional issues we have five stations in California, five TV stations. The issue spending is tremendous.”

Investors are always nervous that’s what they do

“Investors are always nervous. That’s what they do. They are nervous.”

Categories of spending don’t matter for aggregate advertising

“There’s 99 things that could be good and then let’s talk about the one category that’s – when people ask me about categories like I hear auto is down or pharma is down, I swear to God I don’t pay that much attention to it. Because I’ve been doing this a long time and when auto is down retail is up and pharma – you know what I mean? It’s categories aren’t important. And I think from my vantage point, and we’re still about 50% advertising, the economy is doing great and we’re doing great.”

wall between linear and digital advertising is breaking down

” the wall is breaking down between linear and digital advertising and more and more people want the complete package. We’ve always said if you have a product, certain products are time constrained but that’s a very small percentage of your product. If you are buying Kraft macaroni and cheese it doesn’t matter if the people are watching the show 60 days from now it’s still the same package and still the same macaroni and cheese. At least last I saw it was.”

Basic cable re-run marketplace has come down a bit but that’s more than made up for by SVOD players

” you take most basic cable networks that are doing original, they are doing three or four hours of original programming. So it doesn’t cover a week. So they are still buying a great deal from us. And some of those shows, you turn on Turner, there’s a lot of Big Bang Theory, there is a lot of Big Bang Theory. You turn on USA, NCIS is all over the place over there. So a lot of them are still reliant on that programming. Having said that, yes, the marketplace has come down a bit but more than made up for by the SVOD services who want everything. Who you are able to make the competitiveness of the marketplace because of Netflix and Amazon and Hulu and all those people vying for it makes the backend domestically so much better than it used to be when it was just a basic cable sale.”

Twice as many scripted series today as five years ago and that makes it harder to market

“There are 500 scripted series today and five years ago there were 200. So it’s a lot tougher. 90% of our promotion for our network comes from our network. In other words, you sell to people who watch television. You do buy some outside. So that hasn’t really changed. Is it more competitive? Yes. Are the results harder to qualify? Absolutely. You shouldn’t look at overnight ratings anymore. You shouldn’t even – as I said, the backend becomes more important than the front-end. It’s hard to tell what a real hit is than before and there’s a lot of stuff out there.”

Investors are fickle

“The same and investor one month why are you buying back so much to why didn’t you buy back more. It’s very fickle. We’re going to continue with the same basic plan as we have and as I said we are going to receive some capital from the radio deal and we will use some of that for buyback and some of it to invest back in the business. ‘