On The Call: Viacom CEO Philippe Dauman

Viacom Inc., the owner of MTV, Comedy Central and Paramount Pictures, posted a 12 percent decline in net income and a 5 percent drop in revenue this week. A healthy advertising market wasn't enough to outweigh declining demand for home DVDs absent hits like last year's "Star Trek" and "Transformers: Revenge of the Fallen."

Still, MTV is going strong, buoyed once again to the frontline of pop culture with the help of such shows as "Jersey Shore," "Teen Mom" and "16 and Pregnant." Paramount also did well, thanks to blockbusters such as "True Grit" and "The Fighter." And ad revenue grew 10 percent in the U.S. and 7 percent worldwide. CEO Philippe Dauman and COO Tom Dooley answered an analyst's question about that growth during a conference call Thursday.

QUESTION: I was wondering if we could drill down a little bit into the 10 percent ad sales - domestic ad revenue growth for this quarter. I mean 10 percent is a very good number but when we look at your ratings and then we look at the results that Time Warner and News Corp. gave yesterday, I think there might have been some expectations it could have been even better than that.

"What is the difference? Is it that your 2010/2011 upfront was not as strong as theirs? Are you just not generating the same revenue per CPM or per gross rating point that they are? Could you just go into that a little bit given the ratings strength?" (CPM refers or how much ads cost per a thousand views).

DAUMAN: "Well, the ratings strength builds of course. Many of our biggest drivers have been big hit shows that have come on air toward the latter part of the last calendar year, as well as, you look at the last month BET, for example, with its two new scripted shows. A lot of our scripted programming is coming on stream with great success.

"I will point out that we have had great sequential improvement in ad sales growth for several quarters now with each quarter bringing greater sequential growth. So there is more for us to do to take advantage of these new shows that are coming on stream, and there couldn't be a better time for all our important brands to be enjoying such success as we head into the upfront season. So we feel very comfortable about the trajectory in ad sales."

DOOLEY: "And some of our competitors . had the benefit of some pretty strong sports programming in that quarter, which I think gave them a lot of volume lift and pricing power as that category continues to be very strong in the space. And the way the upfront spreads is not exactly linear in terms of how it's booked quarter to quarter to quarter. The first quarter can be a little light for us given the mix of certain of our programming. It will get stronger as we go throughout the year."