Viacom leads new pay TV, video-on-demand venture

By Georg Szalai

NEW YORK (Hollywood Reporter) - The premium TV channel landscape and Sumner Redstone's media empire were hit by an earthquake Sunday.

Viacom Inc. and its Paramount Pictures unit have formed a joint venture with Metro-Goldwyn-Mayer Studios and Lionsgate launch a premium TV channel and video-on-demand service in the fall of 2009.

The news could be a sign of internal strife at Redstone's empire, as it will have a major effect on Viacom sibling CBS Corp.'s Showtime cable channel. The premium network has output deals with Lionsgate, MGM and Paramount that are set to expire and won't be renewed given that the new venture will have exclusive pay TV access to its partners' content.

Redstone is chairman and controlling shareholder of both, Viacom and CBS.

CBS Corp. CEO Leslie Moonves was understood to be briefed on the venture plans Sunday.

The studio venture combines new and classic feature film output and original TV series, giving it exclusive access during the pay TV window to such recent and upcoming films as "Iron Man," "Star Trek," "Pink Panther 2," "Cloverfield," "Robocop." It also covers library hits such as "Dirty Dancing," "Reservoir Dogs," "Crash," "Braveheart," "Forrest Gump," the "Godfather" series and the Rocky and James Bond franchises.

The venture was unveiled Sunday by Viacom CEO Philippe Dauman, Paramount Pictures, chairman and CEO Brad Grey, MGM chairman and CEO Harry Sloan and Lionsgate co-chairman and CEO Jon Feltheimer.

The venture also is expected to name a CEO soon.