MTVN Sheds 3 Top Execs1/12/2007 7:07 PM Eastern
The shoes keep dropping at Viacom Inc., and three of them have come in the top ranks of MTV Networks.
Four months after the ouster of Tom Freston, who created the shout-out “I Want My TV” ad campaign in the early days of the music-video channel, as president of parent company Viacom, a trio of top MTVN executives found themselves walking out the door late Thursday as well. And that left industry executives gathered at the Television Critics Association press tour in Pasadena wondering whether MTV Networks' long-time CEO, Judy McGrath, might be next.
The departees at MTV included:
Michael Wolf, president and chief operating officer, after 15 months trying to move MTV into more digital-media businesses;
Nicole Browning, president of affiliate sales and marketing, after two decades of building up distribution and licensing revenue;
Peter Low, executive vice president of cable TV distribution and affiliate marketing, after 10 years at MTVN.
The departures came on the same day that Gail Berman stepped down as president of Paramount Pictures, after 18 months of trying to turn around that Viacom unit. Viacom's chief financial officer, Michael J. Dolan, left the company at the turn of the year.
Dolan's role was taken over by Thomas Dooley, Viacom senior executive vice president and chief administrative officer. Dooley, a long-time adviser to Viacom chairman Sumner Redstone, came aboard in the wake of Freston's removal on Labor Day. Another executive Redstone has relied on, Philippe Dauman, came on board as CEO, succeeding Freston.
In a prepared statement, McGrath gave no indication whose decision it was to let Wolf, Browning or Low go. She gave glowing references for both Wolf and Browning.
Of former McKinsey & Co. consultant Wolf, she said: “We're grateful to have had his undivided attention devoted to our company for the past year. We accomplished everything we set out to do together.” That included, she said, restructuring MTV's ad-sales, affiliate sales and marketing operations. Which apparently included restructuring Browning out of a job.
Of the longtime affiliate-relationships executive, McGrath said Browning had been “delivering tremendous results financially and operationally.”
But it's no secret that Redstone has been dismayed by MTV's inability, thus far, to become a dominant force in entertainment online.
The straw that may have broken Freston's back, in fact, was reported to be his failure to land music and social networking site MySpace.com last summer, which went to Rupert Murdoch's News Corp. MTV's digital strategy was in Wolf's hands.
Besides the operational changes, his “compelling vision about the digital future of the industry'' was cited specifically by McGrath when he was put in his position; and he was to help set up and implement the company's approach to creating more digital content and services for audiences on computers, cell phones and other portable devices.
But Wolf said his job was “always viewed as a short-term gig.”
“I think that it was a great moment. I think we got a lot accomplished,” he said in an interview.
Wolf cited installing Hank Close, as president of advertising sales in September and Nada Stirratt, formerly at the online ad-sales arm of AOL called Advertising.com, as the networks' new head of digital ad sales, all while creating a new digital advertising sales organization.
Wolf also brought in other executives: Adam Cahan, from Google, as executive vice president of strategy and business development; Collette Chestnut, from J. Walter Thompson, as chief financial officer; and Daniel Aks, from Primedia's magazine unit, as senior vice president of operations. While he was there, MTVN spent close to $1 billion on such Web ventures as Atom Entertainment and its Shockwave.com, Atomfilms.com and Addictinggames.com sites; Xfire, Quizilla, Gametrailers and iFilm, Wolf pointed out.
The company also draws digital revenue from distributing MTV clips through Google, in a deal struck during his tenure; and is launching MTV, Comedy Central and Nickelodeon channels on a new live TV service on Verizon Wireless phones.
SMALL SLICE OF DIGITAL
Still, the company now generates approximately $320 million a year of revenue from its digital businesses, out of a total of roughly $7 billion in 2006.
MTV.com's 40 million visitors each month online makes it a top-10 destination site, according to Wolf. But MySpace.com passed 55 million visitors in August; and Murdoch paid “only” $580 million for the company that owned it, in 2005. That was $400 million less than the tab that Freston, McGrath and Wolf ran up for digital businesses.
Which means the pressure at Viacom will stay high, leading potentially to other departures. “I don't know that everybody's was consensual,'' Wolf said.
But McGrath, he said, is not likely to leave. “She's an incredibly strong creative and business leader and I think she's key to the next wave of the company's growth.''
Given all the changes that have taken place there, one cable industry executive said Friday, “it's not surprising that once Tom left, the question would be how many of the people who have been there for a long time — who have been very successful and made a lot of money — would stay.”
Viacom's stock price closed at $34.97 the day before Freston was fired. It closed at $42.41 Thursday, when the departures of Berman and Wolf were disclosed.
When Viacom Inc. and CBS Corp. split in two, Viacom's new stock started trading on Jan. 3 of last year at $40.
Linda Moss contributed to this story.