PTC says Viacom is breaching duty to shareholders by airing "Skins"


It’s quite possible that the declining viewership of MTV’s controversial scripted offering “Skins” is completely based on its merits or lack thereof. Perhaps the Parents Television Council helped bring down the ratings. It almost certainly helped kill off the program’s associated advertising revenue. Now it is mounting a campaign accusing MTV parent Viacom of breaching its fiduciary duty to its shareholders by allowing the program to finish out its run.

“By any objective standard, MTV’s Skins has been a resounding failure,” wrote PTC. “Audience numbers plummeted from an unspectacular but respectable for cable 3.3 million for the series premiere to fewer than a million the last two weeks. The only viewers that have stuck around are the 12-17-year-olds MTV tried to claim were not the target audience for the show. Even TV critics who are normally eager to leap to the defense of controversial programs have roundly panned Skins.”

PTC said it believes MTV is pushing an agenda to rewrite the rules as to what is permissible on television, and that Viacom is complicit.

PTC concluded, “Viacom has one prime directive as a publicly traded company: to return a profit to its shareholders. In allowing one of its properties, MTV, to continue to air a program that is losing the company money, Viacom is in breach of its fiduciary responsibility to its shareholders.”

It composed yet another point-and-click campaign to flood Viacom with emails making PTC’s points.

RBR-TVBR observation: This charge may look good on paper, but in the final analysis it simply does not hold water. In business, there is the age old concept of a loss leader – something sold below cost, but which gets customers in the door who then make up the loss by consuming other items. If this show loses, but builds overall audience for MTV, then Viacom is violating no fiduciary duty at all.

But PTC has certainly ridden the winning wave in this particular content battle, and it’s no surprise at all – and really, who can blame the organization – for riding the wave all the way to Viacom’s shore.

But that’s likely where it’s energy will be spent, and in the end, we doubt Viacom will suffer any lingering damage.