CBS, Viacom Marriage Poised To Fuel New Ad Technology

The logic of the CBS, Viacom merger, which would create a company valued at $30 billion, is that greater scale will give the company a leg up in all areas of their business—more leverage in negotiations over carriage fees with cable- and satellite-TV distributors, for example, and more programming to sell into a competitive streaming marketplace. Advertising is no different; bigger players have many advantages, reports The Wall Street Journal.

Acting CBS Chief Executive Joe Ianniello this week emphasized the companies’ wide reach among consumers. “And when you combine that reach with our targeting capabilities, the advanced advertising opportunity we’ll have together will be far greater than we would have from either company alone,” he said.

For CBS, which has been successful in selling its sports and entertainment programming but has been less aggressive about developing new ad capabilities, the deal could mean an infusion of data and tech prowess from Viacom, according to advertising executives. Viacom owns and licenses Vantage, a technology platform that helps advertisers figure out which of its TV channels best reach their target audiences. When Viacom last week reported a return to domestic ad growth after 20 quarters of declines, it partly credited its advanced advertising services.

Advertisers, meanwhile, are increasingly pressuring TV networks to help them find programming that reaches more specific audiences, such as car buyers or beer drinkers, instead of the traditional but broad demographics such as women 18 to 49 years old. They also are looking for ways to control how frequently the same viewer sees an ad.

The merger also could boost ad-supported streaming video in a landscape where ad-free options like Netflix and HBO loom large. CBS was among the first TV businesses to launch a streaming service, called CBS All Access, in 2014, and Viacom this year acquired streaming service Pluto TV.

Ad buyers said they hope ViacomCBS, through its libraries of content and existing individual investments in streaming services, will create a viable competitor that is ad-friendly.