When Viacom Chairman Sumner Redstone looks back at his legacy, 2005 must be one painful year to recollect.
That was the year, with all due respect, that News Corp. pulled away from Viacom. Sure, the companies were always fairly different in various ways, but to most, they were two sides of the same coin: TV properties, movie production houses, aspiring Web ambitions… News Corp. was far stronger in print, of course, but to make up for that, Viacom kicked News Corp.’s derriere in radio and outdoors.
2005 changed all of that, partially because of what happened online: in a matter of months, Rupert beat Sumner over MySpace, paying a bit more ($580M) for MySpace parent Intermix… then a few months later, Murdoch once again beat Redstone over IGN, who at the time was my employer after they bought my website in May 2005.
Oddly enough, apparently Viacom’s Spike thought of buying up our site… but they passed, so we eventually sold to IGN Entertainment, who got bought out by News Corp. in the last 24 hours of bidding. Mark Jung, IGN’s CEO, and Great Hill Partners, the Boston-based VC flipped IGN for $650M.
What does Viacom have to show for 2005? A $36M write-off on Amp’d mobile, who burned through $375M. Even its VCs were clueless about what was going on at Amp’d. Typical, really. $375M. Wow. No comments…
Actually, that year, Viacom NeoPets for $160M. It also bought iFilm in 2005, for some $49M. iFilm had a lot of potential and was, until YouTube popped up, the one player in video you thought would go places. But from what I heard, iFilm was suffocated by Viacom, whose integration and management were very different from News Corp. The next year, in 2006, Viacom bought Atom Entertainment for $200M. News Corp. struck back with a bunch of investments, with Strategic Data Corp. coming in 2006, finishing up with 2007’s deal for Photobucket.
From a personal perspective, I wonder what would have happened had Viacom bought us, either the first time around before we sold to IGN, or had they bought IGN. For sure Spike would be a powerful player… I would not had to put up with the disgraceful display of petty, jealousy and envy my back-stabbing ex-partners put me through last year (that didn’t go anywhere of course, because they have the combined IQ of a pea and the class of a charlatan, but I digress).
The point is, business has a very funny way of unfolding.
To feel better about 2005, Redstone canned Tom Freston, spun off CBS from Viacom, now sits atop both companies as Chairman. His CBS was pegged as the income, value component with Viacom seen as the growth engine, but oddly enough, CBS has been the more aggressive company, scooping up companies such as Last.fm and investing in a cornucopia of players. While Viacom has lured dealmakers Philippe Dauman but yet to get really aggressive, CBS has poached executives from Google and Yahoo! to compement dealmaker Quincy Smith. Smith’s team went on a torrid pace to start off 2007, prompting us to ask if CBS was the News Corp. of 2006, but they’ve slowed down of late. Of course, as I say that, expect them to announce 17 deals in August.
In all fairness, CBS’s unique video strategy online has differed from News Corp./NBC’s NewSite but allowed them to get out of the gates faster, while NewSite has given YouTube an extra year to build out a considerable lead. It’s not obvious, being a media company, just this morning I asked “If you’re old media, exactly what do you do” when going online means you effectively shrink your business.
It’s quite possible that since 2005, News Corp. has pulled away considerably and for good from CBS/Viacom, but you never know, because in business - and online - things can indeed turn on a dime.
See our coverage of News Corp., CBS and Viacom in our archives. And see Who is King of Digital Media, here.
Digg this Blog
Share on Facebook
WatchMojo on Twitter
WatchMojo on YouTube
Add to Favorites
WatchMojo Newsletter
