Viacom Shakes Up Leadership at Nickelodeon
February 06 2018 - 8:51PM
Dow Jones News
By Joe Flint and Keach Hagey
Viacom Inc. is shaking up the leadership at its Nickelodeon
Group children's television network, according to people familiar
with the matter.
Currently overseen by Cyma Zarghami, Viacom President and Chief
Executive Robert Bakish is adding Sarah Levy as a high ranking
company executive to be involved in operations and strategy for
Nickelodeon, the media giant's most successful unit.
The move will expand the already large territory of Ms. Levy and
diminishes the role of Ms. Zarghami. Ms. Levy is currently the
executive in charge of operations and strategy for Viacom's other
domestic and international networks including MTV, VH1 and Comedy
Central. Besides Nickelodeon, Ms. Levy will take on a similar role
at BET as well.
Ms. Zarghami, who has been at Nickelodeon for more than three
decades and was named president in 2006, is nearing the end of her
contract and people close to her and Viacom aren't certain she will
remain with the company. While Ms. Levy has a strong relationship
with Mr. Bakish, Ms. Zarghami was closer to Philippe Dauman, the
previous Viacom chief executive.
Initially, there were discussions about replacing Ms. Zarghami
with Ms. Levy, who was a former senior executive at Nickelodeon
under Ms. Zarghami for years. However, there were concerns as to
whether Ms. Levy had enough creative experience for the position.
Viacom also considered going outside its executive ranks and
pursuing Brian Robbins, the co-founder of teen-focused digital
media company AwesomenessTV who was recently tapped to make films
for Viacom's Paramount film studio based on intellectual property
channels like Nickelodeon.
Tensions are already high inside Viacom, which is trying to
revitalize its struggling cable networks businesses. On Tuesday,
the company laid off approximately 100 employees as part of an
effort to save $100 million. Viacom reports quarterly earnings on
Thursday.
The layoffs and restructuring come as Viacom is once again
exploring a merger with CBS Corp. Both CBS and Viacom are
controlled by National Amusements Inc., the holding company of
media mogul Sumner Redstone and his daughter Shari, who is also a
vice chairman of the two entertainment companies.
A force in children's TV with hit shows such as "SpongeBob
SquarePants" and "Henry Danger," Nickelodeon is the most popular
programming service among children 2-11. Nickelodeon is distributed
in over 160 countries and has more than 1.1 billion subscribers
world-wide. Besides Nickelodeon, there are several popular sister
channels including Nick Toons and Nick Jr.
It is also a major revenue generator for Viacom. According to
industry consulting firm SNL Kagan, Nickelodeon had about $2.1
billion revenue from advertising and distribution fees in 2017 and
cash flow of more than $1 billion. The other Nickelodeon outlets
had a combined revenue of $417.7 million and cash flow of $183
million.
Most of Viacom's other businesses, including its cable channels
and the Paramount Pictures television and movie studio have been
struggling, making Nickelodeon even more key to the company's
bottom line.
Like all cable programmers, however, Nickelodeon has suffered
ratings declines as viewing habits change and digital services
become more popular. Its ratings are down 26% among children 2-11
so far this year compared with the same period a year ago,
according to Nielsen.
The decision of Nickelodeon to sell reruns of hit shows to
Netflix Inc. and later Amazon.com Inc., which allowed the streaming
services to establish themselves as a place for children and a
legitimate competitor. Walt Disney Co.'s Disney Channel and Disney
Jr. compete for viewers. Disney also plans to launch a
direct-to-consumer streaming service next year that will be aimed
at children and families.
Write to Joe Flint at joe.flint@wsj.com and Keach Hagey at
keach.hagey@wsj.com
(END) Dow Jones Newswires
February 06, 2018 20:36 ET (01:36 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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