CBS Corporation (US)

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CBS Corporation is the parent company of the CBS TV network and various other assets spun out of media giant Viacom in 2006, undoing a mammoth merger engineered seven years earlier. In addition to CBS and its collection of regional stations, it includes cable channel Showtime, a half share in micro-network The CW, and the book publisher Simon & Schuster. The group's once-extensive outdoor network was carved up and sold off in 2013 and 2014. The 2006 separation from Viacom couldn't have come at a better time for CBS. Although the network's past performance had traditionally lagged well behind Viacom's cable networks, the new group was far more concentrated, positioned as an old-style US media group with a strong presence in broadcast, radio and outdoor media. Expectations that it would prove the less exciting of the two businesses were overturned when it demonstrated an unexpected return to form, overtaking traditional champion NBC, to become the country's most watched network. A reunion with Viacom was briefly explored in 2016 but abandoned. In 2017, Shari Redstone, controlling shareholder of both CBS and Viacom, began pushing once again for the two companies to be re-combined. That prompt an aggressive pushback by CBS, led by long-time CEO Les Moonves. With exceptionally unfortunate timing for Moonves, accusations of harassment by him of female colleagues surfaced mid 2018, leading to his dismissal in September.

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Adbrands Company Profiles provide a detailed analysis of the history and current operations of leading advertisers, agencies and brands worldwide, and include a critical summary which identifies key strengths and weaknesses. Adbrands Account Assignments tracks account management for the world's leading brands and companies, including details of which advertising agency handles which accounts in which countries for major markets. The Adbrands Company Profile of CBS Corporation summarises the company's history and current operations and also contains the following website links:

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National Amusements

Recent stories from Adbrands Weekly Update:

Adbrands Weekly Update 20th Sep 2018: After apparently riding out a first set of allegations of sexual misconduct, CBS CEO Leslie Moonves lost the support of his board after a second set of accusations were published by The New Yorker magazine. The final nail in the coffin appears to have been the revelation that Moonves tried to persuade one of the new batch of accusers not to go public by offering her a job at CBS. It was this attempt to mislead the board rather than the actual allegations that prompted them to withdraw their support. Moonves' abrupt fall from grace represents arguably the biggest scalp to-date for the #MeToo movement. In his 23 years as head of the network, he transformed it from last place in the ratings to the country's most watched. He was docked exit compensation that might have totalled as much as $180m, and CBS has pledged to pay $20m to organisations supporting the #MeToo movement. The company also dismissed Jeff Fager, executive producer of its flagship news program '60 Minutes', who had also been accused by the New Yorker of sexual misconduct, which he denies. However, Fager also sent a threatening text to a female CBS reporter who was looking into those allegations, warning, “Be careful. There are people who lost their jobs trying to harm me and if you pass on these damaging claims without your own reporting to back them up that will become a serious problem." That prompted his dismissal for violation of company policy. Late last year, CBS also sacked star news anchor Charlie Rose after the Washington Post published harassment claims from more than 30 women over three decades. Moonves was replaced as CEO on an interim basis by former COO Joe Ianniello, who has vowed to clean up the company's internal culture, provide training on workplace issues and offer safe channels for whistleblowers.

Adbrands Weekly Update 2nd Aug 2018: Further scalps are being taken or are at risk across the media industry in connection with past inappropriate behaviour by notable figures. In a feature published by the New Yorker magazine, campaigning journalist Ronan Farrow detailed allegations of sexual harassment by CBS CEO Les Moonves of six women with whom he had professional dealings over the past four decades. Writer and actress Illeana Douglas who had been pitching a series to Moonves, told Farrow, "What happened to me was a sexual assault, and then I was fired for not participating." The article also suggested that there had been a wider culture of systemic harassment at CBS in which senior male executives routinely exploited their position to hit on female colleagues. In a statement, Moonves acknowledged that there had been times in the past when he "may have made women feel uncomfortable by making advances. Those were mistakes, and I regret them immensely. But I always understood and respected - and abided by the principle - that 'no' means 'no', and I have never misused my position to harm or hinder anyone's career." The allegations come at a very sensitive time for CBS, which is engaged in an increasingly bitter dispute with its de facto controlling shareholder Shari Redstone, who is trying to broker a reunion with Viacom, from which CBS was de-merged a decade ago. The removal of Moonves would significantly strengthen Redstone's chances. A number of female CBS executives voiced their support for their CEO, but several third parties called for him to be suspended pending completion of the internal investigation. The CBS board met to approve the appointment of two outside law firms to look into the allegations but said they will take no further action against Moonves for the time being.

Adbrands Weekly Update 24th May 2018: The US TV broadcast season wrapped up, with NBC the clear winner by viewers in the key 18-49 demographic for the second consecutive year, and close behind CBS as the overall #1 by total viewers. It was the tenth straight year that CBS has been America's most watched network, and the 15th time in 16 years. (Its only miss was in 2008 when it lost to Fox as a result of the huge success of 'American Idol'). Even so, CBS's average prime-time audience of 9.0m viewers was down by 7% on last year. NBC was close behind at 8.9m viewers, up 9%, helped by the triple whammy of the Super Bowl, the Winter Olympics, and big drama hit 'This Is Us'. ABC was in third place with 6.1m total viewers - the huge success of 'Roseanne' saved it from bottom, along with surprise hit 'The Good Doctor'. Fox trailed in 4th place on 4.9m. That number would have been even lower without hit drama '911'. Among 18-49 year-old adults, NBC was the clear leader with a 2.2 rating. All three other networks scored a 1.5 rating. NBC’s 'Sunday Night Football' was once again the top show in that key demo, averaging a 6.2 rating.

Adbrands Weekly Update 17th May 2018: In a startling turn of events, CBS Corporation has issued a lawsuit against its controlling shareholder National Amusements Inc and its de facto leader Shari Redstone for breach of fiduciary duty. CBS seeks to stop NAI from forcing it to merge with its one-time parent company Viacom, a step Shari Redstone has been advocating for at least the past couple of years. Her ailing father Sumner Redstone split the two companies in 2006 because he believed CBS to be a drag on the performance of Viacom. In fact, the reverse has been the case, with Viacom's valuation steadily sinking while CBS has soared. CBS seems willing to consider a re-merger with Viacom, but not on the terms or at the price Shari Redstone is proposing, and warns that her interference in the governance of CBS poses "a serious threat of imminent, irreparable harm" to the company and its shareholders. A key sticking point is Shari Redstone's insistence that Viacom CEO Bob Bakish get the #2 position within a merged group. CBS is now seeking court approval of a scheme to issue new voting shares to public shareholders that would dilute the stake held by the Redstones from 80% to just 17%. National Amusements called the suit "outrageous" and responded with a vow "to defend our position vigorously in court".

Adbrands Weekly Update 18th Apr 2018: With the traditional US broadcast season entering its final weeks, NBC is set to take top slot for the year with around 9.5m average primetime viewers. Key factors have been its coverage of both the Winter Olympics and the 2018 Super Bowl. CBS is currently in second place with 9.0m total average viewers, followed by ABC at 6.0m and Fox trailing on 5.2m. NBC also leads in the prized 18-49 demographic, with CBS second, and ABC and Fox tied for third.

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Background

Free for all users | see full profile for current activities: CBS was founded in 1928 when 27-year-old William Paley, the son of a successful cigar wholesaler, sold shares in his father's company and used the proceeds to acquire United Independent Broadcasters, a struggling group of 16 radio stations scattered across the country. Along with a number of other radio stations, UIB had signed up to receive broadcasts from Columbia Broadcasting Systems, a sales network established by the Columbia Phonograph Company to promote sales of its 78rpm audio discs. Columbia's plan had failed to take off financially, so Paley bought out the sales network and adopted the CBS name for his chain of radio stations. (Ten years later he acquired Columbia Phonograph as well). He then set about rapidly expanding coverage of the company's broadcasts, signing up another 30 stations across the nation to join the network. In less than four months, Paley had tripled the number of listeners, becoming the country's biggest broadcast network. By 1935, the network had doubled again to almost 100 stations. It was also the first network to establish its own full-time newsgathering service, run by Edward Murrow, quickly earning a reputation as one of the finest news organizations in the world.

CBS had also begun to experiment with television, launching the first scheduled US broadcast service in New York in 1931. The company floated in 1937, and after World War II pushed aggressively into the rapidly expanding TV market. In 1948, CBS launched its first national network, broadcasting to a group of 30 affiliates across the US. By raiding rival networks for their most popular radio and television stars, CBS established a line-up of hugely successful shows during the 1950s. Long-running series such as The Ed Sullivan Show, I Love Lucy, The Beverly Hillbillies, Mission: Impossible and The Mary Tyler Moore Show, as well as primetime news presented by legendary anchorman Walter Cronkite, established CBS as the #1 television network in the US almost without a break for more than two decades from 1955 to 1976. 

The group also diversified into other areas. CBS was already involved in the music industry, having acquired the Columbia Phonograph Company in 1938. In 1948, the company's research department developed a new process for manufacturing longer-playing records which played at a slower speed than old 78s. These 'LPs' were the CDs of their time, revolutionizing the industry and establishing CBS as the world's biggest record company by the end of the 1960s. Also during that decade, CBS had begun experimenting with another new idea, cable networks which could deliver more specialized programming to regional communities. However this quickly came under the scrutiny of regulators, who ruled that companies could not own cable broadcasters as well as regional stations. As a result, CBS was forced to spin off its own cable operations in 1971 into a new entity, which it named Viacom. 

Meanwhile the company continued to enjoy major success through the 1980s, especially with comedy series M*A*S*H and the enormously popular primetime soap opera Dallas. To this day, the final episode of M*A*S*H in 1982 and the 'Who Shot JR' episode of Dallas in 1980 hold the record as the most watched primetime broadcasts in modern television history, watched by more than 60% and 53% of all US households respectively. But by the end of that decade performance had begun to falter. William Paley had retired from day-to-day management of the company in 1987, and died three years later. His successor, Larry Tisch, sold off CBS Records (to Sony) as well as its publishing arm to focus on television, but saw the company's market position eroded over the following decade as a result of fierce competition, especially from Rupert Murdoch's Fox Network. In 1995, CBS was acquired by former household appliance company Westinghouse, which then sold off its own non-broadcast interests, and acquired radio group Infinity Broadcasting. Westinghouse renamed itself CBS Corporation in 1997, but the group continued to struggle for share against the deeper pockets of rival networks. 

Meanwhile, Viacom had gone on to develop a loose network of its own, buying up local TV and radio stations in areas where it didn't own cable, and also taking over CBS's programme syndication business. Among numerous other deals engineered by its new owner Sumner Redstone were the acquisition of both Paramount and Blockbuster Video. In 1996, Viacom combined its TV stations in a joint venture with fellow local operator Chris-Craft to form United Paramount Network, effectively a fifth US TV network. By now, the changing nature of the US industry had encouraged regulators to relax rules over station ownership. As a result, in 1999, CBS boss Mel Karmazin approached Viacom with a proposed reunification of the CBS empire. The deal was completed in mid 2000.

A slight shadow was cast over the deal by News Corporation's acquisition of Viacom's UPN partner Chris-Craft in 2000. The latter had attempted to sue Viacom over the CBS deal, alleging a breach of the UPN partnership agreement. When this suit failed, Chris-Craft sold out to Viacom's arch-rival Fox. Initially it appeared likely that UPN would be wound down as the two rivals consolidated their respective stations into the Fox and CBS networks. Instead the rivals agreed a deal to allow the network to maintain its separate existence for the time being.

Mel Karmazin became president and COO of Viacom after the CBS merger, but his relationship with Sumner Redstone was marked by simmering tension for the following four years. It was not helped by a series of controversial missteps. In 2003 the company was forced to sideline a fictionalised mini-series on the life of Ronald and Nancy Reagan after viewers and commentators lambasted its unflattering and one-sided portrayal of the former President. In early 2004 CBS aired the NFL Super Bowl, including half-time entertainment produced by sister company MTV, featuring singers Janet Jackson and Justin Timberlake. Without informing either CBS or MTV, they had devised a dance routine which culminated in the uncovering of one of Janet Jackson's breasts in front of more than 90m television viewers. The performers initially claimed the incident was simply an unplanned "wardrobe malfunction", but later confessed it had been intentional. The stunt caused a sensation, airing as part of what is considered to be the epitome of family entertainment. The country's broadcasting regulator, the FCC, received more than 500,000 complaints, and CBS and MTV were severely reprimanded both by the FCC and the NFL. CBS was later issued with a $550,000 fine for violating FCC indecency rules, then the biggest penalty ever imposed on a television broadcaster. (That fine was overturned four years later by a US appeals court.)

Only a few months later another Viacom unit, Nickelodeon, was fined an even higher $1m for exceeding adverting time limits within children's programming, and the group was repeatedly reprimanded for the on-air comments of Infinity radio "shock jock" Howard Stern. Eventually Viacom agreed a settlement with the FCC, paying $3.5m in respect of complaints over Stern (who left Infinity during 2004) and other radio and television programs. In yet another blunder during the year, veteran CBS News anchor Dan Rather delivered a story questioning President George W Bush's military record in the National Guard, based on what turned out to be unsubstantiated and possibly forged documents. The network was forced to apologize, and four senior news employees were later fired. It was an inglorious end to Rather's distinguished career, and he subsequently issued a $70m lawsuit against CBS for damaging his reputation. Yet another fine, totalling $3.5m, was handed down in 2006 to more than 100 network affiliates for airing an episode of drama series Without A Trace in 2004 which depicted a teen orgy.

Mel Kamarzin finally resigned as CEO of CBS in June 2004. Meanwhile, despite strong growth in several of its units, Viacom's stock price continued to languish between 2002 and 2004. When the spin-off of Blockbuster failed to fix this problem, Sumner Redstone began developing an even bigger restructuring designed to kickstart an improvement by splitting more traditional businesses such as broadcast TV and radio from high-margin, fast-growth cable. The separation of CBS and Viacom was first announced in summer 2005, and following approval from the board, was completed in January 2006. see full profile for current activities


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