- @ Mixx: Moonves: Why Pay $1.8 Billion For CNET? So We Could Take Money Away From Newspapers

David Kaplan
Tuesday, September 23, 2008; 12:07 PM

After a quick introduction for their Q&A session at the Interactive Advertising Bureau's Mixx conference, IAB head Randall Rothenberg asked CBS CEO Leslie Moonves something he's been asked a lot lately: Why spend $1.8 billion on CNET ( NSDQ: CNET).

-- From old media to new instantly: Moonves: We are a content company. Some may have a considered us an old media company. We brought Quincy [Smith, president and CEO of CBS Interactive and CNET] on and tried to build up what is now CBS Interactive ( NYSE: CBS). We began doing some small acquisitions, launching the CBS Audience Network. I wouldn't call CNET a secret, but this was something we could build on, make it bigger become, instantaneously, one of the top internet content providers in the world. If content and distribution is what we're about, then CNET makes that more true."

-- Going local and beating newspapers: Rothenberg asks how the acquisition will work with CBS' local TV and radio stations. Using the CNET restaurant guide site Chowhound as an example of local media that was the province of newspapers and not associated with TV or radio, Moonves does the math: "We own 129 radio, TV stations, more billboard. In a local market, Chow can be sold and crossed with our properties. Does it allow with CBS stations to compete against local newspapers more effectivel? Clearly, we're taking money away from newspapers. You will go to Chow for eating or for help wanted?all the kinds of information you used to turn to newspapers for. Radio and TV couldn't do that on their own. We're finding sales teams on radio side are able to sell more online to existing clients."

-- Being all things to all internet users: Moonves: "I love having a network where 24 million watchCSIor a network that attracts millions to the Olympics. Our idea is to be all things to all people?and to offer sales and marketing and content around that position. The CBS Interactive group works with ever business group we have. And it is not cannibalistic. The main reason people go online is not to watch all of a TV series. Your most loyal viewer only watch two out of four episodes. People do other things at night, unfortunately. So they go online to watch those other two shows."

-- "Everywhere strategy" stays: When the idea of pursuing a wide syndication strategy and offering as much content online as possible was pushed by CBS Interactive's Smith, Moonves says he was a more than a little apprehensive."I was scared. I lost sleep. Is that going to bastardize what we do on the network. Is that going to be one less viewer on the air, if they watch it online. We pulledGossip Girloff the web for a few weeks and it was a mistake. But it's back now and the ratings are up."

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