Viacom ( VIA) Chairman Sumner Redstone said Monday evening he could imagine buying a cable TV system, but he gave a thumbs-down to getting into the satellite TV business.

Redstone also predicted that the company's local advertising businesses, which disappointed investors last year, would rebound by the second quarter.

Appearing at a Bear Stearns conference in Palm Beach, Fla., Redstone spoke bullishly about Viacom's prospects in China, saying that the company hoped to have 24-hour MTV channels in both Beijing and Shanghai, and adding that the prospects for Viacom's outdoor advertising business in China were "astronomical."

If the right opportunity to buy a cable TV system arose, Redstone said Monday, "we might own it." Such ownership would represent a major turnaround for Viacom, which once was one of the largest operators of cable TV systems in the U.S., but sold off its systems several years back to focus on programming (along with its TV and radio broadcast stations, among other properties).

Redstone said later, however, that he wasn't interested in buying EchoStar ( DISH) -- which, now that Rupert Murdoch has a controlling stake in DirecTV parent Hughes Electronics ( HS), is the only conceivable takeover candidate in the satellite TV business. While EchoStar Chief Charlie Ergen is a "smart guy," Redstone said, "I wouldn't want to be No. 2."

Viacom and EchoStar are currently locked in a programming dispute over the terms of EchoStar's carriage of CBS stations on EchoStar's Dish Network. Suggesting that EchoStar had asked for terms Viacom could never accept, Redstone said, his voice rising, "There is no way Viacom can or will give Charlie Ergen a better deal than it gives to Rupert Murdoch" or Comcast ( CMCSA).

While speaking confidently about the recovery of the radio business and other local advertising, Redstone said the results would be surprisingly good and that the local businesses would return to their historic growth rates. But he hedged his comments by saying, "It's very early. Please don't change your numbers."

Asked about the prospects for satellite radio -- spearheaded in the U.S. by XM Satellite Radio ( XMSR) and Sirius ( SIRI) -- Redstone said satellite radio was a great stock, but not a good business. The problem, he said, is that most radio advertising dollars are local, which doesn't fit in with the national broadcasting. "If satellite radio were going to be a big deal businesswise ... we would have bought it," he said.

Redstone said he would be in China March 16, and indicated he would be meeting with retired Chinese president Jiang Zemin.

In other company news, Redstone said it appeared that the previously announced spinoff of Blockbuster ( BBI) would take place in July.

He also said he believed the Federal Communications Commission understood that Viacom was a victim of, not a culprit behind, Janet Jackson's wardrobe malfunction at the Super Bowl. Said Redstone, "I don't know about you guys -- to me a woman's breast is not such a big deal."

Viacom's shares fell 80 cents Monday to close at $39.25.