Richard Drew / AP
The corporate boards of Viacom and CBS agreed to merge into a share deal Tuesday, reuniting the Redstone family's entertainment crew following a series of legal battles and corporate intrigues.
The move is intended to make the mixed company valued at around $ 30 billion to fight rallied competitors and a new threat from digital rivals with well-funded streaming services.
Viacom CEO Bob Bakish will oversee the new company, which will be called ViacomCBS. The deal would combine such well-known entertainment brands as CBS and Showtime with Viacom's Paramount TV and movie studios, Nickelodeon, Comedy Central and MTV.
CBS also owns the book publisher Simon & Schuster. Current CBS CEO Joe Ianiello will oversee the former CBS properties under Bakish.
"Our unique ability to produce premium and polar content for global audiences at scale – for our platforms and for our partners around the world – will enable us to maximize Bakish's statement.
The new The chairman of the combined company will be Shari Redstone, who controls the family's holding company, National Amusements, along with her 96-year-old father, Sumner Redstone, while Viacom and CBS are listed, both controlled by the family through National Amusements.
The merger seems unlikely to be blocked by federal regulators or antitrust lawyers, with Viacom and CBS largely not direct competitors, and the U.S. Department of Justice recently lost the challenge to the Time Warner AT&T acquisition.
Still, though the deal going through, and even in its new booklet, the new Viacom will remain on the smaller side.
Comcast, NBC and Unive Parents rsal, and AT&T, following the takeover of Time Warner and CNN, each combines Hollywood firepower with critical cable and Internet communications services as well as digital and mobile phones. They are tremendously larger than ViacomCBS would have been.
So is the new Disney, further bolstered by its recent acquisition of much of Fox's entertainment, including the Star Wars and Marvel franchises.
Like Disney, AT&T is moving aggressively to create a new entertainment streaming service. For AT&T, the service will focus on the DC comics superhero franchises, the HBO programs and films, as well as the comic and film archives.
Still, many of the country's leading digital giants look with great concern. Amazon and Netflix have dipped into seemingly bottomless wallets to pull creative talent away from conventional networks and studios, urging Americans to cancel their cable subscriptions with many new shows. Apple is also focusing on providing original TV content (it has had paid streaming services for several years).
CBS has continued to stream more than its broadcast rivals, with a digital 24-hour news service called CBSN and a paid entertainment streaming service. This service, called CBS All Access, has had a modest success with hits such as The Good Fight and a renewal of the Star Trek franchise.
Sumner Redstone shared CBS from Viacom in January 2006 in the belief that it would detach the more profitable entertainment vehicle Viacom from the storied, old-school network's TV divisions at CBS. When that happened, CBS proved the more dynamic company under Les Moonves, the then CEO and later chairman.
As Sumner Redstone ages, Shari Redstone had to fight with her father's former girlfriends and his executives to secure her position. CBS, led by Moonves, fought in the boardroom and courtroom to expand National Amusements' voting share to prevent her from gaining control of the company. But Moonves was derailed by a sexual assault and harassment scandal, which led to his shooting. (He has denied the charges.)
With Moonves gone, the road to the reunion of the two wings of the entertainment empire Redstone was far smoother. The more pressing issue now is that the new ViacomCBS may not be big enough to hold off its Hollywood or Silicon Valley rivals. If it does not successfully buy other properties, the merged company may have just made itself attractive enough to be bought by a major player, such as Amazon – which does not have a network – or Verizon, which lacks any major TV presence.