As Vice Moves More to TV, It Tries to Keep Brash Voice
The live music at the Vice Media party on Friday shook the room. Shane Smith, Vice’s chief executive, was standing near the stage — with a drink in his hand, pants sagging, tattoos showing — watching the rapper-cum-chef Action Bronson make pizzas.
The event was an after-party, a happy-hour bacchanal for the hundreds of guests who had come for Vice’s annual presentation to advertisers and agencies that afternoon, part of the annual frenzy for ad dollars called the Digital Content NewFronts. Mr. Smith had spoken there for all of five minutes before running a slam-bang highlight reel of the company’s shows that had titles like “Weediquette” and “Gaycation.”
In the last year, Vice has secured $500 million in financing and signed deals worth hundreds of millions of dollars with established media companies like HBO that are eager to engage the young viewers Vice attracts. Vice said it was now worth at least $4 billion, with nearly $1 billion in projected revenue for 2015. It is a long way from Vice’s humble start as a free magazine in 1994.
But even as cash flows freely in Vice’s direction, the company is trying to keep its brash, insurgent image. At the party on Friday, it plied guests with beers and cocktails. Its apparently unrehearsed presentation to advertisers was peppered with expletives. At one point, the director Spike Jonze, a longtime Vice collaborator, asked on stage if Mr. Smith had been drinking.
“My assistant tried to cut me off,” Mr. Smith replied. “I’m on buzz control.”
Now, Vice is on the verge of getting its own cable channel, which would give the company a traditional outlet for its slate of non-news programming. If all goes as planned, A&E Networks, the television group owned by Hearst and Disney, will turn over its History Channel spinoff, H2, to Vice.
The deal’s announcement was expected last week, but not all of A&E’s distribution partners — the cable and satellite TV companies that carry the network’s channels — have signed off on the change, according to a person familiar with the negotiations who spoke on the condition of anonymity because the talks were private.
A cable channel would be a further step in a transformation for Vice, from bad-boy digital upstart to mainstream media company.
Keen for the core audience of young men who come to Vice, media giants like 21st Century Fox, Time Warner and Disney all showed interest in the company last year. Vice ultimately secured $500 million in financing from A&E Networks and Technology Crossover Ventures, a Silicon Valley venture capital firm that has invested in Facebook and Netflix.
Those investments valued Vice at more than $2.5 billion. (In 2013, Fox bought a 5 percent stake for $70 million.)
Then in March, HBO announced that it had signed a multiyear deal to broadcast a daily half-hour Vice newscast. Vice already produces a weekly newsmagazine show, called “Vice,” for the network. That show will extend its run through 2018, with an increase to 35 episodes a year, from 14.
Michael Lombardo, HBO’s president for programming, said when the deal was announced that it was “certainly one of our biggest investments with hours on the air.”
Vice, based in Brooklyn, also recently signed a multiyear $100 million deal with Rogers Communications, a Canadian media conglomerate, to produce original content for TV, smartphone and desktop viewers.
Vice’s finances are private, but according to an internal document reviewed by The New York Times and verified by a person familiar with the company’s financials, the company is on track to make about $915 million in revenue this year.
It brought in $545 million in a strong first quarter, which included portions of the new HBO deal and the Rogers deal, according to the document. More of its revenue now comes from these types of content partnerships, compared with the branded content deals that made up much of its revenue a year ago, the company said.
Mr. Smith said the company was worth at least $4 billion. If the valuation gets much higher, he said he would consider taking the company public.
“I don’t care about money; we have plenty of money,” Mr. Smith, who is Vice’s biggest shareholder, said in an interview after the presentation on Friday. “I care about strategic deals.”
In the United States, Vice Media had 35.2 million unique visitors across its sites in March, according to comScore.
The third season of Vice’s weekly HBO show has averaged 1.8 million viewers per episode, including reruns, through April 12, according to Brad Adgate, the director of research at Horizon Media. (Vice said the show attracted three million weekly viewers when repeat broadcasts, online and on-demand viewings were included.)
For years, Mr. Smith has criticized traditional TV, calling it slow and unable to draw younger viewers. But if all the deals Vice has struck are to work out, Mr. Smith may have to play more by the rules of traditional media. James Murdoch, Rupert Murdoch’s son and a member of Vice’s board, was at the company’s presentation on Friday, as were other top media executives.
“They know they need people like me to help them, but they can’t get out of their own way,” Mr. Smith said in the interview Friday. “My only real frustration is we’re used to being incredibly dynamic, and they’re not incredibly dynamic.”
With its own television channel in the United States, Vice would have something it has long coveted even as traditional media companies are looking beyond TV. Last year, Vice’s deal with Time Warner failed in part because the two companies could not agree on how much control Vice would have over a 24-hour television network.
Vice said it intended to fill its new channel with non-news programming. The company plans to have sports shows, fashion shows, food shows and the “Gaycation” travel show with the actress Ellen Page. It is also in talks with Kanye West about a show.
It remains to be seen whether Vice’s audience will watch a traditional cable channel. Still, Vice has effectively presold all of the ad spots to two of the biggest advertising agencies for the first three years, Mr. Smith said.
In the meantime, Mr. Smith is enjoying Vice’s newfound role as a potential savior of traditional media companies.
“I’m a C.E.O. of a content company,” Mr. Smith said before he caught a flight to Las Vegas for the boxing match on Saturday between Floyd Mayweather Jr. and Manny Pacquiao. “If it stops being fun, then why are you doing it?”
Robert Patterson Jr., Lawyer and Judge Who Fought for the Accused, Dies at 91
Judge Patterson helped to protect the rights of Attica inmates after the prison riot in 1971 and later served on the Federal District Court in Manhattan.
Marcel Pronovost, 84, Dies; Hall of Famer Shared in Five N.H.L. Titles
Pronovost, who played for the Red Wings, was not a prolific scorer, but he was a consummate team player with bruising checks and fearless bursts up the ice that could puncture a defense.
Dave Goldberg, Head of Web Survey Company and Half of a Silicon Valley Power Couple, Dies at 47
By VINDU GOEL and QUENTIN HARDY
Mr. Goldberg was a serial Silicon Valley entrepreneur and venture capitalist who was married to Sheryl Sandberg, the chief operating officer of Facebook.
Dean Skelos, Albany Senate Leader, Aided Son at All Costs, U.S. Says
Over the last five years or so, it seemed there was little that Dean G. Skelos, the majority leader of the New York Senate, would not do for his son.
He pressed a powerful real estate executive to provide commissions to his son, a 32-year-old title insurance salesman, according to a federal criminal complaint. He helped get him a job at an environmental company and employed his influence to help the company get government work. He used his office to push natural gas drilling regulations that would have increased his son’s commissions.
He even tried to direct part of a $5.4 billion state budget windfall to fund government contracts that the company was seeking. And when the company was close to securing a storm-water contract from Nassau County, the senator, through an intermediary, pressured the company to pay his son more — or risk having the senator subvert the bid.
The criminal complaint, unsealed on Monday, lays out corruption charges against Senator Skelos and his son, Adam B. Skelos, the latest scandal to seize Albany, and potentially alter its power structure.
The repeated and diverse efforts by Senator Skelos, a Long Island Republican, to use what prosecutors said was his political influence to find work, or at least income, for his son could send both men to federal prison. If they are convicted of all six charges against them, they face up to 20 years in prison for each of four of the six counts and up to 10 years for the remaining two.
Senator Kenneth P. LaValle, of Long Island, who serves as chairman of the Republican conference, emerged from a closed-door meeting Monday night to say that conference members agreed that Mr. Skelos should be benefited the “presumption of innocence,” and would stay in his leadership role.
“The leader has indicated he would like to remain as leader,” said Mr. LaValle, “and he has the support of the conference.” The case against Mr. Skelos and his son grew out of a broader inquiry into political corruption by the United States attorney for the Southern District of New York, Preet Bharara, that has already changed the face of the state capital. It is based in part, according to the six-count complaint, on conversations secretly recorded by one of two cooperating witnesses, and wiretaps on the cellphones of the senator and his son. Those recordings revealed that both men were concerned about electronic surveillance, and illustrated the son’s unsuccessful efforts to thwart it.
Adam Skelos took to using a “burner” phone, the complaint says, and told his father he wanted them to speak through a FaceTime video call in an apparent effort to avoid detection. They also used coded language at times.
At one point, Adam Skelos was recorded telling a Senate staff member of his frustration in not being able to speak openly to his father on the phone, noting that he could not “just send smoke signals or a little pigeon” carrying a message.
The 43-page complaint, sworn out by Paul M. Takla, a special agent for the Federal Bureau of Investigation, outlines a five-year scheme to “monetize” the senator’s official position; it also lays bare the extent to which a father sought to use his position to help his son.
The charges accuse the two men of extorting payments through a real estate developer, Glenwood Management, based on Long Island, and the environmental company, AbTech Industries, in Scottsdale, Ariz., with the expectation that the money paid to Adam Skelos — nearly $220,000 in total — would influence his father’s actions.
Glenwood, one of the state’s most prolific campaign donors, had ties to AbTech through investments in the environmental firm’s parent company by Glenwood’s founding family and a senior executive.
The accusations in the complaint portray Senator Skelos as a man who, when it came to his son, was not shy about twisting arms, even in situations that might give other arm-twisters pause.
Seeking to help his son, Senator Skelos turned to the executive at Glenwood, which develops rental apartments in New York City and has much at stake when it comes to real estate legislation in Albany. The senator urged him to direct business to his son, who sold title insurance.
After much prodding, the executive, Charles C. Dorego, engineered a $20,000 payment to Adam Skelos from a title insurance company even though he did no work for the money. But far more lucrative was a consultant position that Mr. Dorego arranged for Adam Skelos at AbTech, which seeks government contracts to treat storm water. (Mr. Dorego is not identified by name in the complaint, but referred to only as CW-1, for Cooperating Witness 1.)
Senator Skelos appeared to take an active interest in his son’s new line of work. Adam Skelos sent him several drafts of his consulting agreement with AbTech, the complaint says, as well as the final deal that was struck.
“Mazel tov,” his father replied.
Senator Skelos sent relevant news articles to his son, including one about a sewage leak near Albany. When AbTech wanted to seek government contracts after Hurricane Sandy, the senator got on a conference call with his son and an AbTech executive, Bjornulf White, and offered advice. (Like Mr. Dorego, Mr. White is not named in the complaint, but referred to as CW-2.)
The assistance paid off: With the senator’s help, AbTech secured a contract worth up to $12 million from Nassau County, a big break for a struggling small business.
But the money was slow to materialize. The senator expressed impatience with county officials.
Adam Skelos, in a phone call with Mr. White in late December, suggested that his father would seek to punish the county. “I tell you this, the state is not going to do a [expletive] thing for the county,” he said.
Three days later, Senator Skelos pressed his case with the Nassau County executive, Edward P. Mangano, a fellow Republican. “Somebody feels like they’re just getting jerked around the last two years,” the senator said, referring to his son in what the complaint described as “coded language.”
The next day, the senator pursued the matter, as he and Mr. Mangano attended a wake for a slain New York City police officer. Senator Skelos then reassured his son, who called him while he was still at the wake. “All claims that are in will be taken care of,” the senator said.
AbTech’s fortunes appeared to weigh on his son. At one point in January, Adam Skelos told his father that if the company did not succeed, he would “lose the ability to pay for things.”
Making matters worse, in recent months, Senator Skelos and his son appeared to grow wary about who was watching them. In addition to making calls on the burner phone, Adam Skelos said he used the FaceTime video calling “because that doesn’t show up on the phone bill,” as he told Mr. White.
In late February, Adam Skelos arranged a pair of meetings between Mr. White and state senators; AbTech needed to win state legislation that would allow its contract to move beyond its initial stages. But Senator Skelos deemed the plan too risky and caused one of the meetings to be canceled.
In another recorded call, Adam Skelos, promising to be “very, very vague” on the phone, urged his father to allow the meeting. The senator offered a warning. “Right now we are in dangerous times, Adam,” he told him.
A month later, in another phone call that was recorded by the authorities, Adam Skelos complained that his father could not give him “real advice” about AbTech while the two men were speaking over the telephone.
“You can’t talk normally,” he told his father, “because it’s like [expletive] Preet Bharara is listening to every [expletive] phone call. It’s just [expletive] frustrating.”
“It is,” his father agreed.
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