CBS's Long-Term Strategy Paying Off for Shareholders

We have written about Clear Spin-Off Index constituent CBS Corp (CBS) twice before, and now with summer sweeps and web integration in the works it is good to see that it's faring well.

As far as the shrinking of the broadcast media audience, CBS is bringing its audience on-line, and creating new touch points, all of which offer advertising opportunities. As I wrote on May 25, it seems that new audience interactions are now the norm.

To continue its march to blur and blend its content between the web and broadcast, CBS Interactive announced that its month-old, ad-supported CBS Audience Network added 13 partners in social and community networks. The deal allows and promotes the embedding of video clips from CBS shows into user profiles, Web sites, blogs, wikis, widgets, and community pages.

On Wednesday, CBS purchased social-networking/music/online radio website Last.fm for $280 million in cash. Based in London, Last.fm, claims that it has 15 million monthly users, with four million of these based in the United States.

Regarding the broadcast audience, the positive results should make network executives crazy because CBS has scored well based on reruns.

Wayne Friedman posted this Tuesday on MediaPost:

The official start of the summer TV season Thursday had Fox quietly dancing in the aisles. CBS was sashaying a bit, too.

Still, Fox won the night, with a 3.3/10.

But right behind was CBS with its usual top-rated repeats-better than virtually anyone else. The best-rated show of the night was a repeat of "CSI" at 9 p.m., with a 4.1/12. That's more than double ABC's "Grey's Anatomy" rerun, which took in a 1.8/5.

CBS also won the 10 p.m. time period with a rerun of "Shark," at 2.9/9, which easily beat a "Grey's" repeat and an NBC leftover original of "Studio 60 on the Sunset Strip," which took in a 1.6/5.

ABC came in third at a 1.8 rating/5.7 share. Right behind was NBC in fourth place with a 1.8 rating/5.5 share.

Reruns are usually skipped this time of year in favor for what is on the DVR, premium channels and movies on-demand which usually win the evening. Networks bold enough to present new programming may best all of its competition. The only high profile new show in my appointment viewing book is HBO’s The Soprano’s, which took the week off. This week watching broadcast reruns seemed to work just fine.

CBS appears to be spreading its tentacles which are orchestrated, and connected at the corporate core. This long-term strategy should bode well for shareholders.

CBS 1-yr chart

Disclosure: CBS Corp is a constituent in the Clear Spin-Off index licensed for the Claymore/Clear Spin-Off ETF [AMEX:CSD].
Mr. Corn is CEO of Clear Indexes LLC which publishes the index, and he owns shares of the ETF: CSD.
He does not directly own shares in CBS.