Viacom's third-quarter profits slumped by 37 percent amid poor movie sales and TV ratings -- but its ancillary and games revenue, led by Rock Band, grew 36 percent on the strength of the popular rhythm game.
As MTV and Nickelodeon parent Viacom's profits slump amid poor film performance and weak MTV ratings, Rock Band is leading its games business to strong growth. The company's third quarter profits fell 37 percent on the year overall. But its "ancillary revenue" category, which contains its games, saw healthy 36 percent growth to $313 million. This was apparently driven by Rock Band 2's debut and DLC/catalog sales of previous titles in the franchise - and with the Wii and PS2 versions of Rock Band 2 still to debut, there is likely to be some further upside. Viacom's total revenues were up by about 4 percent to $3.4 billion, but at $401 million, earnings were down from $641 million for the same period last year. The company's film business, which turned a $72 million profit last year, saw a $19 million loss as Paramount Pictures titles like The Love Guru and Ghost Town bombed at box offices. Viacom Chairman Sumner Redstone recently sold $233 million in Viacom and CBS shares from his National Amusements Inc. holding company, a move which incidentally affects publisher Midway, as Redstone's National Amusements essentially backs it and his daughter Shari chairs its Board. The Associated Press today reported that Redstone would not sell CBS or Viacom shares in that way again. "This was an extraordinary action brought on by an unprecedented situation and let me assure you of one thing," he said, "National does not intend to sell one more share of stock in Viacom or CBS."
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