Viacom Wants Insurance to Cover Lost 9/11 Ad Revenue

The January 13 issue of Broadcasting & Cable magazine reports that Viacom – parent company of the CBS and UPN television networks, Infinity radio conglomerate, Paramount Pictures, and a bevy of cable-TV channels, among other properties – has filed a claim with its insurance company seeking $200 million in compensation for lost advertising revenue due to the 9/11 attacks on NYC and DC.
You may recall (with a pleasant, warm feeling) that for a brief few days following the attacks the major networks (both broadcast and cable) went ad-free with wall-to-wall news coverage and docudrama. The common wisdom at the time was, within the broadcast industry, that running adverts during a time of national crisis was in bad taste.
That was then – this is now.
Viacom is seeking to claim the lost ad revenue under the “business-interruption” policy it has. This type of insurance is typically used to cover expenses incurred by companies that would normally put them out of business. In broadcasting, such policies most commonly cover actual broadcast facilities (transmitters, antennas, towers, etc.).
According to Broadcasting & Cable, Viacom claims it had no choice but to yank the ads, citing its FCC-mandated “public interest obligations” that come with the licenses to the 39 television stations and 180+ radio stations it owns. It deserves note that the government did not actually force any media outlet to pull advertising from the air.
When I first read this, I thought of Dan Rather, leaning on the shoulder of David Letterman as he broke down from the stress of covering the calamity during a post-9/11 cross-promotional appearance on The Late Show (both Rather and Letterman are CBS products). Now I wonder if those tears were real, or whether he was reflecting the mood of the Viacom boardroom when they hit the calculators to find out how much their spasm of “public interest obligation” cost them.
Of course, I doubt any of Rather’s paychecks bounced because of this.
As with most unflattering news about corporate media machinations, this story appeared and disappeared almost immediately: outside of Broadcasting & Cable (an industry trade rag), it has surfaced in one NY daily tabloid and on a right-wing web site which managed to contort the facts to fit its misguided claptrap crusade on the “bias” of the “liberal media.”
Heaven knows, when we start slinging explosives at Iraq en masse we’ll see the fireballs and tracer sparkles bracketed by lots of spots, as war is great for business.