Viacom is partnering with a popular social media site, announcing an advertising and content deal Tuesday with Snapchat.
Viacom “will lend its advertising relationships and large portfolio of TV shows to the hot start-up Snapchat Inc. as the two try to shake off questions about their financial futures,” the Los Angeles Times reports. “Privately held Snapchat is valued at $16 billion — more than Viacom’s $13 billion market capitalization — but the Venice company has yet to figure out how to turn a profit.”
The deal with Snapchat was seen as one of the few bright spots in Viacom’s first-quarter earnings report Tuesday, with the company facing “increasing challenges as viewers younger than 35 shun cable TV and instead head to online video options such as Netflix, YouTube and Facebook,” the story reports.
“Viacom and Snapchat became instant friends last summer when they paired up on MTV’s Video Music Awards: 5 million people tuned into MTV to watch the show on cable television; 12 million watched highlights on the social media app,” the Times notes. “The numbers sent a clear message: If TV shows want to stay relevant, they have to go to where the viewers are — their phones.”