Sumner Redstone
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| Born: | 27 May 1923 Boston, Massachusetts |
|---|---|
| Occupation: | Global media businessman |
| Spouse: | Phyllis Gloria Raphael (1944 - 1999) Paula Fortunato (2002 - present) |
| Children: | Shari Redstone, Brent Redstone |
| born Sumner Murray Rothstein | |
Sumner Murray Redstone (born Sumner Murray Rothstein on May 27, 1923 in Boston, Massachusetts) is Chairman of the Board and controlling shareholder of the Viacom and CBS Corporation media conglomerates, and is also the majority owner of Midway Games and is the owner of the National Amusements theater chain.
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[edit] Early Life and Career
Born to a Jewish American family, his parents were Michael and Belle Rothstein, who changed the family name from Rothstein to Redstone in 1940, when Sumner was 17. His father, Michael Rothstein, was the owner of the Northeast Theater Corporation in Dedham, Massachusetts. [1]
Redstone attended the prestigious Boston Latin School, where he graduated first in his class (and with the highest grade point average in the school's history). He then attended Harvard College, where he completed his B.A. in three years. Later, Redstone served in World War II, decoding Japanese messages for the United States Army. Upon completion of his Army service, he worked in Washington, D.C. and attended Georgetown University Law School. He chose to transfer into Harvard Law School and received his LL.B. from that institution.
After completing law school, Redstone worked primarily in Washington, D.C., working at first for the U.S. Department of Justice in San Francisco and then going into private practice. However, after a few years in practice, he chose to join his father's theater chain management operation, what is now known as National Amusements.
As Redstone grew National Amusements, he believed that content would become more important than distribution mechanisms. There would always exist channels of distribution (albeit in varied forms), but content was always going to be necessary (his famous quote is "content is king!"). He then made investments in Columbia Pictures, Twentieth Century Fox, Orion Pictures, and Paramount Pictures (the latter of the 4 of which Redstone's Viacom would buy in the 1990's-see below), all of which turned over huge profits when he chose to sell the stock in the early 1980s.
In 1999 he was divorced from his first wife of 55 years, Phyllis Gloria Raphael. He is the father of Shari Redstone and Brent Redstone. Three years after his divorce he married Paula Fortunato, forty years his junior, a former primary school teacher.
[edit] Viacom
Looking for a new business to develop, he set his sights on Viacom International, a company that was a spin-off of CBS in 1971 after the FCC ruled that television networks could not syndicate programs they produced. Viacom syndicated most of CBS's programs, but also made a lot of money from syndicating other programs, including most of Carsey-Werner Productions' shows (The Cosby Show, Roseanne, and A Different World), as well as syndicating shows for other companies (Columbia Pictures Television's All In The Family was one notable example), and cable channels (Nickelodeon's Double Dare and Finders Keepers (co-syndicated with Fox Television Stations) were two examples).
Viacom also owned MTV Networks (formerly known as Warner-AMEX Satellite Entertainment), which owned MTV and Nickelodeon. In addition, other included properties included Showtime Networks (a similar pay-television network to HBO and Cinemax) and The Movie Channel. Viacom acquired MTV Networks in 1985 for $550 million from Steve Ross' Warner Communications (WCI bought American Express' share and then sold the entire entity to Viacom, as they felt that they could not make a lot of money from the venture and the bias that a studio owning cable channels would be a conflict of interest, which would change when Time Warner bought Turner Broadcasting in 1995).
After a hostile takeover in 1987, Redstone won voting control of Viacom and led a series of acquisitions to make Viacom one of the top players in modern media (along with General Electric & Vivendi's NBC-Universal, News Corporation, Time Warner, Sony, and The Walt Disney Company).
[edit] Paramount Pictures
Redstone's next acquisition came in the form of the purchase of Paramount Communications, parent of Paramount Pictures, in 1993, which he fought over with Barry Diller (former board member of Vivendi Universal and CEO of IAC/InterActiveCorp) and John Malone (president of TCI/Liberty Media), where he had to raise his bid three times. Some say that Redstone overpaid, but after he shed certain assets (the Madison Square Garden properties to Charles Dolan's Cablevision and Simon & Schuster's educational publishing units to Pearson plc for almost $4 billion), Redstone turned Paramount's expenditure into a substantial profit.
The Paramount acquisition was only the tip of the iceberg. Redstone purchased Blockbuster Entertainment, which included Aaron Spelling's production company and a huge library of films, much of which has been merged into Paramount Pictures. Blockbuster has now been spun off into its own independent entity.
In December of 2005, Redstone announced that Paramount was going to buy DreamWorks SKG for an estimated 1.6 billion dollars
[edit] CBS
One of Redstone's largest acquisition came in the form of Viacom's former parent, CBS. Former Viacom President & COO Mel Karmazin (who was then the President of CBS) proposed a merger to Redstone on favorable terms and after the merger completed in 2000, Viacom had some of the most diversified businesses imaginable. Viacom had assets in the form of broadcast networks (CBS and UPN), cable television networks (MTV, Nickelodeon, MTV2, Comedy Central, BET, Nick at Nite, Noggin/The N, TV Land, CMT, and Spike TV), pay television (Showtime and The Movie Channel), radio (Infinity Broadcasting, which produced the immensely popular Howard Stern' radio shows), outdoor advertising, music publishing (Famous Music), motion pictures (Paramount Pictures), and television production (Spelling Entertainment, Paramount Television, and Big Ticket Entertainment), and King World Productions (a syndication unit, which notably syndicates the runaway daytime hit, The Oprah Winfrey Show, as well as Dr. Phil, Wheel of Fortune, and Jeopardy!), among others.
[edit] Succession
Redstone made arrangements to step down from Viacom in 2006, mainly due to concerns about his age. After Mel Karmazin resigned in 2004, two heirs apparent were named: Co-President & Co-COO Leslie Moonves (who was #2 to Karmazin at CBS; he was the former head of Warner Bros. Television and before that, Lorimar Television) and Co-President & Co-COO Tom Freston (who has been President & CEO of MTV Networks since 1987 and had been with the company since the formation of MTV Networks' precursor company, Warner-AMEX Satellite Entertainment). Since Viacom spun off CBS, Moonves has headed CBS, and Freston has headed MTV Networks.
It is rumored that Monves was promoted to Co-President & Co-COO with Tom Freston, not only for his talent and management style, but also because he was on the short list of executives to replace Michael Eisner at the Walt Disney Company whose contract expired in 2006. (Peter Chernin, the President & COO of News Corporation, parent of Fox Entertainment Group, was also rumored to having been considered for the post, but it eventually went to Robert Iger, the Disney corporation's President and COO). To keep Moonves on board, Redstone elevated his position to equal standing with Tom Freston.
On September 5, 2006 Redstone removed Tom Freston as President and CEO of Viacom and replaced him with director and former Viacom counsel Philippe Dauman. This was surprising to many, as Freston had been seen by many as Redstone's heir apparent and that Redstone touted that Freston would run the company after he retired. Redstone publicly stated that he let Freston go because of Viacom's lack of aggressiveness in the digital/online arena, lack of contact with investors, and a lackluster upfront (coupled with falling viewership) at MTV Networks. http://www.viacom.com/press.tin?ixPressRelease=80704186]
Redstone has commented publicly that his stock in Viacom will be left to his daughter, Shari Redstone (Vice Chairwoman of the Board of Viacom, President of National Amusements), although he has always been vague as to whether or not she would take more of an active role within the company.
The company split was approved by the Viacom board on June 14, 2005.
[edit] Holdings
Currently, Redstone owns over seventy percent of the voting stock of Viacom. Viacom, in actuality, is a (not wholly owned) subsidiary of National Amusements, which is his privately held, family owned company. CBS Corporation, likewise, is controlled by Redstone through National Amusements. Redstone also owns over eighty-nine percent of Midway Games, both individually and through National Amusements.
However, the Midway holdings has drawn the ire of the National Football League, as Midway's "Blitz: The League", a game using a fictional league (previous versions had an NFL license), featured gratuitous violence, excessive amounts of sex, and material which the NFL would have rejected, all while CBS has NFL rights.
In 2006 CBS Corporation's CBS Radio unit sued Howard Stern and Sumner has become the butt of criticism on his show along with CBS CEO Leslie Moonves. Although, it is rumored that Howard ran into Sumner in a restaurant in NY, and said "I'll be back". Redstone acknowledged that this happened, but said Stern was joking.
[edit] Books
His autobiography, A Passion To Win (which was co-written by Peter Knobler), was released in 2001 and published by Viacom's Simon & Schuster book publishing company. This book details everything from Sumner's life as a young boy in Boston, to the difficult takeover of Viacom, and the problems he overcame in purchasing and managing both Blockbuster Video and Paramount Pictures. There is also coverage of the legendary CBS merger (Viacom was a spin-off company of CBS to syndicate its programs, and the subsidiary bought the parent almost 30 years later! Interestingly, Viacom's broadcasting properties at the time of APTW's release included several radio stations and two TV stations (WBZ CBS 4 [which had just become a CBS O&O through a merger with Westinghouse 4 years before Viacom and CBS merged] and WSBK UPN 38) in Redstone's hometown of Boston.)
[edit] Net worth
In 2006 he was ranked #63 on Forbes magazine's list of the hundred richest people in the world, with an estimated worth of US$7.7 billion.
[edit] Trivia
Midway Games, of which Sumner owns 89%, published a game called Gauntlet: Dark Legacy wherein one of the main characters is a wizard named Sumner.
In 1979, at the age of 56, Sumner survived a Boston hotel fire by hanging onto a third story ledge with one arm while badly burned over most of his body.
In August 2006 Redstone ended a lucrative contract with actor Tom Cruise due to "behavior unacceptable to Paramount". This surprised some, as Cruise was their number one box office star. Some say it is because the film Mission: Impossible III underperformed at the box office, although it was still a hit at close to US$400 million worldwide revenues. Others say this is a warning to what some see as spoiled and overpaid actors.
[edit] External links
[edit] Photos
- http://images.forbes.com/media/peopletracker/241/240682_TS.jpg
- http://www.surferess.com/CEO/assets/images/apviacom-SumnerRedstone.jpg
Categories: 1923 births | Living people | American entrepreneurs | American federal lawyers | American World War II veterans | Billionaires | Boston Latin School alumni | Forbes 400 | Forbes World's Richest People | Harvard Law School alumni | Harvard University alumni | Jewish-American businesspeople | Mass media owners | People from Boston
