MTV Networks honcho reigns over global powerhouse
HOLLYWOOD — He readily peppers his conversation with references to pop culture rather than quarterly profits. That predilection for the core business of creativity helps explain why Tom Freston is largely credited with keeping MTV Networks light on its corporate feet.
The global niche cable player is celebrating its 20th anniversary — perfect timing for its chairman-CEO to be tapped as the Mipcom Personality of the Year, the 10th such recipient in as many years.
Mipcom chairman Xavier Roy says the award celebrates “MTV Networks’ outstanding leadership and creative contributions” as well as Freston’s “outstanding career and contribution to the TV industry.”
Freston, 55, could be thought of as a geezer guru for such a youth-focused array of services but he talks about the cutting edge and finding the next big thing as infectiously as a 15-year-old. But in addition to his passion, Freston brings years of experience and vision to the task of running a media behemoth whose main mission is to stay hip.
At the cabler since inception, Freston has held a succession of posts, culminating in his appointment to the top job in 1987. Since then, he has driven MTV Networks into new markets domestically and overseas, and overseen an impressive enlargement of the company’s portfolio of programming assets.
The cabler’s programming reaches 350 million living rooms worldwide in 140 countries. Its 30-plus localized channels take in $3 billion in global advertising. The company also operates 15 regionally focused Web sites located around the world.
In short, the company has become a global beacon to the youth of the world.
And youth in MTV Networks terms now extends from the toddlers who watch “Blue’s Clues” on Nickelodeon to the high school set glued to “Real World” on MTV to the thirtysomethings that click on “Behind the Music” bios of their favorite performers on VH1 to the 50-year-olds who have rediscovered “The Bob Newhart Show” on TV Land.
In a far-ranging interview with Freston last month in Los Angeles, the globe-trotting chief exec described some of the reasons he believes MTV will stay at the forefront of global pop culture for years to come.
Perhaps the most compelling reason, he says, is: “We make decisions from the bottom up.” The company regularly trawls for young talent and tolerates a high percentage of turnover in its lower ranks in order to get at the freshest, most innovative people and ideas.
“We set a fairly high bar for staffers,” Freston says, “and we do a lot of generation research. We want to know what is happening on the edges of the culture — and how we can connect with that.”
Indeed, current and former execs suggest that the company willingly changes direction every five years or so in the hopes of not becoming old hat in the eyes of its core demo — those fickle 12- to 25-year-olds.
“It’s been a long time since anyone 55 years old started a social trend,” Freston says, self-deprecatingly.
Unlike many of his media comperes on both sides of the Atlantic, Freston did not spend his early working years scratching his way up the corporate ladder. Rather, he wandered the globe for several years, ending up running a textile factory in India for eight years. An experience that made him more adventurous and more intrigued with alternative lifestyles.
That openness may help explain why MTV has been quick to recognize the value of localism in its global strategy. It operates a highly decentralized global exec structure with the emphasis on regional hiring and it has conscientiously striven to put local talent on the air in its foreign music feeds.
“There are,” Freston explains, “a few big-name international superstars (in the music world) that everyone relates to and there is, simultaneously, a desire among all cultures to see themselves reflected in the media they watch.”
Thus, under the direction of international topper William Roedy, MTV has come up with 30-plus localized feeds for its foreign channels, nurturing homegrown talent wherever possible.
Freston is particularly excited about the current teen boom in the U.S. — one, he says, which is enriched by immigration waves not seen by regions like Japan and Europe.
“Music will be impacted by this generation more than by the now 50-plus boomers,” he argues.
He also believes that in the next few years more ideas and pop influences will surface from Latin America and from the Far East than, say, from Europe, where the population is decidedly older.
Despite Freston’s upbeat appraisal of the health of MTV Networks, the company faces a number of challenges:
- Local competition
From the U.K., where the BBC has just been granted the right to launch two digital kids channels, to Germany, where Viva is a potent rival, local players (some backed by Hollywood players) are increasingly determined to get into niche businesses like kids and music.
So far, MTV has held its own as No. 1 in almost all foreign territories; on the even-more competitive kids front, Nickelodeon is regularly one of the top-rated contenders. A newly invigorated Disney Channel, which just took over Fox Kids abroad, could, however, pose a threat.
- Advertising downturn
The worldwide slump in the ad market will mean that MTV Networks won’t achieve the 20% cash-flow growth of the past 14 years. And Viacom bosses Sumner Redstone and Mel Karmazin are not the kind of bosses who tolerate excuses.
- Corporate synergy
How well Freston and his team manage to take advantage of the opportunities Viacom’s other operations have to offer without getting stifled by the bureaucracy involved will be crucial to the health of MTV Networks.
On the plus side, MTV can point to the handful of feature films, think “Rugrats,” which the company has originated and which Paramount Pictures took to market.
“We’ve been to film school with Sherry Lansing and Jonathan Dolgen for the last five or six years,” Freston says, referring to the toppers at Paramount Pictures, adding that MTV Networks will continue to do about three movies a year.
MTV Networks also has taken advantage of cross-promotion with sibling terrestrial net CBS and radio net Infinity, most recently on its Michael Jackson special.
“The greater bulk of our business is still, however, with the outside world,” Freston says. “That’s because Viacom wants the best shows possible on our networks.”