Company to open Nickelodeon-themed resorts
Viacom is expanding beyond its core business of movies and cable nets into the hotel industry, announcing Thursday that it will open a series of Nickelodeon-branded hotels around the world.
Taking a page from Disney’s playbook, the kidvid powerhouse will break ground on about five hotels in the next several years, with plans to build as many as 20 during the next 13 years. Nickelodeon prexy Cyma Zarghami said the move repped “a new era for the Nickelodeon brand.”
Hotels will be family-oriented vacation spots that build on net’s animated properties like “SpongeBob SquarePants” and “Dora the Explorer.”
Real-estate developer Miller Global is the primary investor in the venture, but Nickelodeon will receive licensing fees in exchange for the use of Nick brands. Marriott will manage the hotels, to be called Nickelodeon Resorts by Marriott.
MTV Networks chair-CEO Judy McGrath touted the initiative at a press conference in Gotham on Thursday, saying the company hoped to ply services to families who want “a weekend with SpongeBob instead of another weekend in colonial Williamsburg.”
Hotels will feature water parks and a live studio for Nick-themed shows. The first location will open in San Diego in 2010, with other locales tentatively planned for Australia, Asia and the U.K. Net has also submitted a plan to remake New York’s contested Governor’s Island into a Nick theme park.
Nickelodeon’s foray continues Hollywood’s history of embracing the hospitality biz.
Theme parks generated nearly 30% of Disney revenue last quarter. Universal and Warners operate character-driven theme parks ; and entertainment execs like Harvey Weinstein sit on the board of Six Flags.
The move into hotels marks Viacom’s boldest bid into a new business sector. The company until now has traded on its television properties primarily with pushes into new content areas like movies and mobile.
It is developing a theme park at Minnesota’s Mall of America and has made one, much smaller foray into hotels, a Holiday Inn in Orlando, Fla., owned by Miller Global.
Execs hope the initiative can bear fruit for its television and licensing biz; they cited the hotels as an effective way “to introduce people to our products.”
Nickelodeon may be feeling pressure to grow revenues in new ways.
The children’s net remains the most profitable cabler, with about $1.24 billion in cash flow last year and relatively low production expenses. But SNL Kagan expects the growth of that cash flow to decrease next year from $120 million to $108 million.
Zarghami explained the timing of the new project by noting that for the first time, a generation that was raised on Nick now has children itself. Net has existed in some form for more than 25 years.
Move comes less than a year after former Viacom sibling CBS Corp. completed the sale of its Paramount Parks division to Cedar Fair.