Viva has been operating for 25 years
Viacom (VIA) (VIAB) is shutting down its music video channel Viva in Germany, ending the channel’s 25-year run. Axing Viva is expected to create room and free up time for Viacom’s Comedy Central channel to expand in German-speaking markets. Comedy Central and Viva currently share the same channel in Germany, where Comedy Central broadcasts for 12 hours from 2 PM to 2 AM and Viva broadcasts the rest of the time. Beginning in January next year, the Comedy Central channel will expand to 24-hour programming in Germany.
Viacom’s decision to eliminate Viva in Germany and turn over its hours to Comedy Central is in response to the strong demand for the Comedy Central channel in the German-speaking market.
Narrowing programming focus
Shutting down Viva in Germany is part of Viacom’s strategy to focus on growing its core brands in the international market. Those core brands are Comedy Central, MTV, BET, Paramount Channel, Nickelodeon, and Nick Jr. However, closing Viva doesn’t mean that Viacom has decided to give music fans a blackout. MTV will continue to serve Viacom’s music customers after Viva goes away. Germany will join the UK where the Viva channel has already ceased broadcasting.
Opportunity to control costs
Narrowing programming to just six core brands could also go a long way towards enabling Viacom to better control costs and boost profitability. Viacom is executing on a cost-cutting plan, and it recently said it was on track to deliver over $100 million in cost savings in its fiscal 2018 ending in September. The company made a $266 million profit in its fiscal Q2 2018, an increase of about 120% YoY (year-over-year). Walt Disney (DIS), Comcast (CMCSA), and Charter (CHTR) grew their profits by 23%, 21%, and 8.4% YoY, respectively, in the quarter ended in March. Dish Network’s (DISH) profit fell 2.2% YoY in the quarter.