With eye on Web, CBS makes key hire
The arrival of tech banker Quincy Smith suggests acquisitions in
digital media are likely.
By Meg James, Times Staff Writer
http://www.latimes.com/entertainment/news/la-fi-
cbs6nov06,1,7172389.story?ctrack=1&cset=true


Last week, CBS Corp. Chief Executive Leslie Moonves told Wall Street
that his team was sniffing around for up-and-coming Internet
properties to buy, preferably on the cheap.

"We're not going to buy YouTube," Moonves said, referring to the
wildly popular video-sharing website that Google Inc. agreed to
acquire last month for $1.65 billion. "But it's not a bad idea to
buy the next YouTube."

Today, CBS is expected to announce that it has hired a 35-year-old
investment banker, Quincy Smith, to find the "next YouTube."

"I appreciate the pressure," Smith said with a chuckle during an
interview. The company named him president of its newly created CBS
Interactive division.

The move demonstrates that CBS, which is sitting on a stockpile of
$3 billion in cash, is eager to make acquisitions to better position
itself in digital media.

"CBS is a great platform, and with that kind of money, they can
really do some damage," said Blake Krikorian, chief executive of
Sling Media, maker of the Slingbox, which allows consumers to stream
content from their home television set onto the Web and receive it
in a remote locale. "Quincy is going to make a big difference," he
added.

Smith helped broker several deals during his tenure at investment-
banking firm Allen & Co., including last year's $160-million sale to
Viacom Inc. of Neopets, a website that allows people to
invent "virtual" pets, and AOL's acquisition of advertising.com.
Before joining Allen & Co., a boutique specializing in media deals,
Smith was a founding partner of a venture capital firm headed by
former Netscape CEO James Barksdale.

Smith's relationships and Silicon Valley experience — he worked five
years at Netscape — should help him bridge the gap between the
freewheeling, entrepreneurial spirit of technology start-ups and the
buttoned-down culture of CBS, which got its start before the Great
Depression with 16 radio stations, people who know him say.

Smith said that his deal-making background "doesn't mean that we're
going to be all acquisitions all of the time." He also wants to
exploit CBS' vast library of old sitcoms and dramas or even snippets
of old celebrity interviews from "Entertainment Tonight."

These days, media companies, including CBS, are scrambling for
Internet assets to hold on to their share of advertising revenue.
That's becoming more challenging as corporate ad dollars migrate to
the Internet and away from traditional media outlets such as TV and
radio stations.

Not lost on Moonves is that in September, his boss, Sumner Redstone,
fired former Viacom Chief Executive Tom Freston, blaming him for the
cable programmer's sluggish move to the Internet. Redstone singled
out Viacom's failure to buy social-networking site MySpace before
rival Rupert Murdoch's News Corp. swooped in and acquired it.

Last week, CBS announced that it was part of a group that invested
$40 million in Spot Runner Inc., which uses the Internet to create
low-cost ads.

Smith helped broker the deal, in which Allen & Co. is also an
investor.

Smith will report directly to Moonves in a restructuring that will
see Larry Kramer step down as president of CBS Digital Media.

Kramer, who has been in charge of CBS' Internet operations for two
years, will stay on as an advisor. He said the move made sense
because CBS "has a hunger to grow things quickly."

"This is exactly the right thing for the company to do, and he is
the right man for the job," Kramer said. "Quincy has got real
enthusiasm for where the business can go."

Kramer added that he was proud of his stewardship, organizing CBS'
scattered Internet assets and helping the company's executives adapt
their operations to make better use of the medium.

"It's amazing how far we've come," Kramer said. "We're a division
now, and a profitable operation. But it's been an exhausting two
years."

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