Viacom Activates Powerful Studio Model Growth Driver As MTV, Nick Move Into Third-Party Production

by Stuart Winchester, Viacom

Pinky Malinky is an upbeat teenager who has a lot in common with his peers: he posts rabidly on social media, he hangs out nonstop with his two best pals, and he constantly must navigate the social pressures of school and life. But there’s one very important thing that will make Pinky unique among Nickelodeon characters (besides the fact that he’s a talking hotdog): when his show debuts later this year, fans will find him exclusively on Netflix.

But Pinky won’t likely be alone for long – across Viacom’s ecosystem, brands are digging into their vaults to identify intellectual property that could be an ideal fit for a digital or linear programmer outside of Viacom. MTV, under the banner of MTV Studios, is for the first time cracking open its rich, 35-year archive to offer its iconic, youth-centric content – Real World, Daria, Aeon Flux, the Emmy Award-winning Made, just to start – in new or reimagined form on non-Viacom platforms. In addition to strategically tapping the 200 titles in its massive library, MTV Studios will churn out new ones, including, to start, The Valley (working title), about a group of friends growing up in the U.S.-Mexico border town of Nogales, and MTV’s Straight Up Ghosted, in which victims of this mobile-age abandonment will confront their disappearing former intimates.

Similar efforts will follow at other Viacom networks.

This studio model – under which Viacom will license and produce new episodes of fully owned content for third parties – will present an enormous growth opportunity, as the company’s brands increasingly feed the insatiable global demand for premium content.

Viacom is uniquely positioned to do this. The company’s voluminous original content libraries house an enormous number of beloved properties that speak deeply to their fans. Its archives stretch back decades – and, in the case of Paramount Pictures, more than a century. Its properties resonate deeply with high-value audiences: kids (Nickelodeon), African-Americans (BET), youth (MTV), the LGBTQ community (Logo), and more. Viacom’s global footprint means that those audiences stretch across cultures and borders. As the first port-of-call for creatives pitching shows tailor-made for these audiences, Viacom’s brands are keenly aware of what is in the market. Its production expertise is second to none.

And even as these sorts of deals multiply, Viacom will retain all consumer products rights for all properties, fueling the company’s increasingly robust consumer products operation.

The possibilities for third-party licensing and production are practically limitless. Pinky Malinky – which will feature Nick branding at the show open and embodies Nickelodeon’s patented spirit of fun and surprising stories and characters – is just the first of up to a dozen properties that the brand is positioning for reboots or co-productions this year alone.

Valen-time to hang out with my best friends! ❤️❤️ @babs_buttman @jj_james0n

A post shared by Pinky Malinky (@pinky_malinky) on

“Proliferating distribution platforms create incremental demand for VIAB’s [Viacom’s] content because high-quality branded content is one of the most valuable forms of differentiation for competing distribution platforms,” Needham declared in a bullish March analysis of the company’s stock. “VIAB’s film and television libraries represent differentiated, globally scalable, long-lived content.”

Take, for example, Jack Ryan, the Tom Clancy action hero who fought his way through five Paramount Pictures films, starting with 1990’s The Hunt for Red October. The quintuplet of movies grossed hundreds of millions of dollars and still carries strong brand recognition and a built-in fanbase. But while there is no obvious basecamp for Ryan within Viacom’s current brand archipelago, his bulletproof vest is a perfect fit for Amazon Video, which will debut the 10-part Jack Ryan series in August.

This branching out into third-party content production has been subtly underway for some time, both in the United States and abroad. Paramount Television, the production arm of Paramount Pictures that is producing Jack Ryan, has quietly built a $400 million-per-year business from scratch by producing premium content like Netflix’s 13 Reasons Why and USA Network’s Shooter.

In May, Viacom International Studios (VIS) united the extensive production capabilities of wholly Viacom-owned Argentinian broadcaster Telefe and majority-owned Brazilian comedy brand Porta dos Fundos with Viacom’s Miami-based production operations, creating a multi-lingual machine that will develop, produce and distribute original content around the world. A matrix of SVOD, pay TV and free-to-air distribution deals will place VIS-produced long-form series (Borges on Netflix in Latin America), cinematic adaptations (Telefe’s Animal on Fox Networks’ platforms in Latin America), telenovelas (Vikki RPM on Caracol Televisión in Colombia), and co-productions (Club 57 on Rainbow Group in Italy and Nickelodeon elsewhere) in diverse markets and maximize the potential of formerly regional or local properties.

These licensing deals will therefore sprinkle tastes of Nickelodeon and MTV and Telefe and other Viacom properties throughout the global content ecosystem, while segmenting the full brand experience for consumers who subscribe to a Viacom linear or digital distributor. Even so, this nascent third-party production is already acting as a powerful growth driver as Viacom diversifies outside of its core television business under President and CEO Bob Bakish.

“Building on the success of Paramount Television and Telefe’s quickly growing production business, we’re going to much more aggressively tap into the huge demand for content and unlock more of our IP and production and creative capabilities to drive incremental revenues from third-party platforms,” Bakish said on Viacom’s second-quarter 2018 earnings call in April. “This isn’t just an idea. … there is a lot of interest from SVOD partners in licensing library properties from MTV and Nickelodeon IP for brand-new interpretations. At the same time, we’re also developing new IP for the sector and have already closed deals for brand-new original Nick IP and animation with third parties and we see more in the pipeline.”

Viacom Forges Global Content Machine, Reinforcing Growing Premium Business

by Stuart Winchester, Viacom

Viacom’s rapidly growing international division has united two Latin American content powerhouses with its Viacom International Studios (VIS) production unit, transforming the studio into a global content machine with development, production and distribution capabilities. A number of SVOD, pay TV and free-to-air distribution deals will accompany the expansion, which complements and bolsters Viacom’s burgeoning premium content business.

The combination folds the production capabilities of wholly Viacom-owned Argentinian giant Telefe and majority-owned Brazilian comedy brand Porta dos Fundos under the same umbrella as the Miami-based studios that churn out Latin American content for Nickelodeon, MTV, Comedy Central and other Viacom brands.

“Since combining our production and sales forces last year after the acquisitions of Telefe and Porta dos Fundos, our focus has been on creating the highest-quality Spanish- and Portuguese-language content and expanding our distribution beyond Latin America, making the new Viacom International Studios a true global player in Latin American original content,” said VIMN Americas President Pierluigi Gazzolo. “With more than a decade of producing original, hit content for the Viacom brands, and expertise and content delivered through our acquisition of Telefe and investment in Porta dos Fundos, we are growing the reach of our product and client base with SVOD players, MVPDs and broadcast partners around the world. These partnerships are testament to the power of our brands and strength of our original productions.”

Viacom International Studios held a preview of upcoming content for new clients in May, shortly after Viacom announced the formation of the upgraded entity.

The reformulated VIS will inject global scale into many formerly regional properties, unlocking potential for high-quality content to reach a far larger audience. Fox Networks Latin America, for example, will distribute Telefe’s thriller movie Animal (from Oscar-winning screenwriter Armando Bo), on digital and linear platforms across the region, while Netflix will air the Comedy Central-Porta dos Fundos co-produced Borges in Latin America. Nickelodeon and Italy’s Rainbow Group will co-produce the 60-episode Club 57 time-travel epic, with VIS handling global distribution and Rainbow Group retaining rights in their home country.

Viacom President and CEO Bob Bakish hinted at the potential of distributing local content across worldwide channels at the recent MoffettNathanson Media & Communications Summit in New York City.

“But those local cornerstones are not only about our strength in those particular markets, but they’re also content engines more broadly, and one of the things you’re going to see that you haven’t really seen yet is our Telefe asset becoming a major producer of novela product for the world,” he said. “We’re going to be distributing about 700 hours globally, that’s not something that Telefe used to do. It’s something I’m very excited about.”

This ramping up of Spanish- and Portuguese-language content production with studios in Miami, Buenos Aires and Rio de Janeiro will act as a powerful international complement to Viacom’s burgeoning premium content capabilities under Paramount Pictures’ Paramount Television production studio. Behind hits such as USA Network’s Shooter, Netflix’s 13 Reasons Why, and TNT’s The Alienist, Paramount Television has grown from nothing just a few years ago into a sought-after production hub with anticipated revenues of $400 million in 2018 alone.

Expanding Our Footprint: Viacom International Studios Opens in Miami

by Kate Laverge, Viacom International Media Networks
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Earlier this week, we announced the opening of Viacom International Studios, our new state-of-the art production hub for Viacom’s global entertainment brands in Miami.

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