The second incarnation of Viacom Inc. ( or ; a portmanteau of Video & Audio Communications) was an American multinational mass media and entertainment conglomerate with interests primarily in film and television. It was established on December 31, 2005, as one of two companies which succeeded the original Viacom, alongside the second CBS Corporation. The controlling shareholder of both companies was National Amusements, a theater company headed by businessman Sumner Redstone. The split was structured so that the original Viacom changed its name to CBS Corporation and spun out its cable and film interests as a new Viacom.
The second Viacom operated Viacom Media Networks, through which it controlled approximately 170 networks and reached approximately 700 million subscribers in approximately 160 countries. Viacom's studio assets included Paramount Pictures, MTV Films, and Nickelodeon Animation Studio, as well as a 30% ownership stake in the Rainbow S.p.A. animation studio. CBS Corporation retained the over-the-air broadcasting, television production, pay television subscription service, and publishing assets, which were previously owned by the first Viacom. The second Viacom was the world's ninth-largest media company in terms of revenue and headquartered at One Astor Plaza in Midtown Manhattan, New York City.
Viacom would announce its second merger with CBS Corporation on August 13, 2019. The merger was completed on December 4, resulting in the creation of ViacomCBS (now Paramount Global).
History
Early years
In March 2005, the first Viacom announced plans of exploring the option of splitting the company into two publicly traded companies because of a stagnating stock price and the rivalry between Les Moonves and Tom Freston, longtime heads of CBS and MTV Networks, respectively. Also, the company was facing issues after MTV was banned from producing any more Super Bowl halftime shows after the Super Bowl Halftime Show controversy in 2004.
After the departure of Mel Karmazin in 2004, Sumner Redstone, who served as chairman and chief executive officer, decided to split the offices of president and chief operating officer between Moonves and Freston. Redstone was set to retire in the near future, and a split was seen as a creative solution to the matter of replacing him. It was also intended to provide alternative investments that would be more appealing to investors: one a high cash flow, lower growth company that could afford to pay a substantial dividend and the other a growing company that would have greater investment opportunities and therefore would not be expected to pay a dividend.
The second Viacom was created by Redstone and headed by Freston. It consisted of BET Networks, MTV Networks, and Paramount Pictures. It started trading on January 3, 2006.
2000s
In June 2005, Viacom announced its purchase of Neopets, a virtual pet website, along with GameTrailers, GoCityKids, and iFilm. That December, Paramount announced it would acquire DreamWorks Pictures. All indications were that the whole of DreamWorks—both live-comedy film and television studios, albeit not the DreamWorks archive (which was sold to a group led by George Soros in March 2006) nor the animated unit (which was not part of the deal)—would remain owned by Viacom, even though CBS Corporation acquired Paramount's television studio.
In February 2006, Paramount completed the acquisition of DreamWorks. On April 24, Viacom obtained Xfire. In August, Viacom announced that it had acquired Atom Entertainment for $200 million. In September, Viacom acquired game developer Harmonix for $175 million.
In February 2007, Viacom ordered leaked copyrighted video clips be taken off the video-sharing service YouTube for copyright reasons. On February 21, Viacom publicly announced they would be offering free online access to their material through Silicon Valley's distributor Joost.
On May 21, 2007, Viacom entered into a 50–50 joint venture with Indian media company Network 18 to form Viacom 18 which would house Viacom's existing channels in India: MTV, VH1 and Nickelodeon as well as Network 18's Bollywood movie business. All future Viacom content for India and new ventures such as a Hindi entertainment channel and a Hindi movie channel would be housed in this joint venture.