Newly named Viacom Inc. co-president Tom Freston said he is talking to a handful of internal candidates — basically his circle of top lieutenants at MTV Networks — as candidates to succeed him as head of the crown jewel cable-network unit.
“I’ve gone to talk to them, and some of them have come to talk to me,” said Freston, who last week was promoted following Mel Karmazin’s exit from Viacom.
Within the next few weeks, Freston said he expects to choose his successor as chairman and CEO of MTVN.
His former slot became vacant last week when he and CBS Television Network CEO Leslie Moonves were both promoted, ascending to share the titles of Viacom president and chief operating officer in the wake of Karmazin’s departure.
Right now, the field of candidates for Freston’s potential replacement includes: MTVN Group president Judy McGrath, who now oversees MTV: Music Television, MTV2, Comedy Central, VH1, CMT and Logo; MTVN Group president Herb Scannell, who oversees Nickelodeon/Nick at Nite, TV Land, Noggin and Spike TV; Bill Roedy, president of MTV Networks International; and Mark Rosenthal, MTVN’s president, chief operating officer and head of ad sales.
“There are four or five obvious people,” Freston said. “They all report to me now. It’s a really rich group of talent.”
In an interview last week before leaving for Los Angeles, Freston also stressed that he doesn’t plan to fold Black Entertainment Television or Showtime Networks into MTVN. BET and Showtime fall under Freston’s purview following last week’s changes.
“My goal for BET is, how do they get more resources to invest in doing what they’ve already proven they can do very well — which is improve their viewership and increase their business?” Freston said. “That’s it.”
STILL ON PROWL
Freston said Viacom is keeping an eye peeled for cable acquisitions.
In a scenario that had long been anticipated — due to long-standing tension with Viacom chairman and CEO Sumner Redstone — chief operating officer Karmazin left the company last week.
In the wake of his departure, Viacom split up its domain between Freston and Moonves, who will vie with each other to succeed Redstone in three years.
In addition to now having MTVN, BET and Showtime under his wing, Freston was also given responsibility for Simon & Schuster and the motion-picture operations of Paramount Pictures.
Moonves will oversee Viacom’s broadcast-TV businesses, and be responsible for Paramount Television, Infinity Broadcasting Corp. and Viacom Outdoor.
Freston pointed out that he’s spent 18 years in his job as CEO of MTVN, which he has built into a cable powerhouse of more than two dozen networks, from ratings leader Nickelodeon to Comedy Central, which Viacom now wholly owns.
“I worked with him for 16 years, and I had a ton of fun,” said Oxygen chairman Geraldine Laybourne, formerly chief of Nick. “In a lot of ways, Tom and I are similar in that we’re half creative and half business, and we’re both creative risk-takers and fiscally conservative. So it was a very good match and for me, it was a wonderful partnership.”
MTVN’s upper-management echelon is so strong that Freston can afford to take his time in picking a replacement, cable-industry insiders said.
“He’s got a lot of talent there,” Laybourne said. “He’s got very accomplished people who have been in stable management.”
In the meantime, would-be candidates are making their cases.
“Now you’ve got people jockeying for Freston’s spot,” said one MTVN insider, who said of the corporate culture, “Oh my God, it’s political.”
As to his timetable for naming a replacement, Freston said, “It will be as soon as I can do it.”
“I have an obvious choice of candidates, all of whom can do the job,” he said. “I’m trying to figure out what the optimal solution is. My goal is to make the decision very quickly, within a couple of weeks.”
There’s been speculation that Doug Herzog, who just left USA Network to rejoin Comedy as president, might be considered to replace Freston. But Freston shot that down.
“He’s got his hands full at Comedy Central,” Freston said of Herzog. “We want to use him there for awhile.”
EDGE TO MCGRATH?
Industry sources were divided about who will get Freston’s old gig. Some are betting that McGrath has the edge: They pointed out that Comedy Central and Logo, Viacom’s in-the-works channel for gays, were recently put under her wing — a big corporate vote of confidence.
Freston’s biggest headache in his new job is the Paramount movie studio, which Jonathan Dolgen left last week after his unit was put under Freston’s watch.
Some suggested Freston might expand McGrath’s duties to include the movie studio.
“There might be a broader role for Judy,” one source said. Others fear that this year’s controversial Super Bowl “Nipplegate” incident with Janet Jackson will hurt McGrath’s odds, even though she and MTV deny that they knew anything about the singer’s plans to bare her breast.
Some said Scannell has his hands full handling the conversion of what was once The Nashville Network into men’s network Spike TV.
Other sources maintained McGrath and Scannell are perceived by MTVN management as having their strength on the creative rather than the business side, which could give the upper hand to Rosenthal, who came up through the affiliate-sales ranks.
“It’s Rosenthal’s to lose,” one former MTVN executive said. “He’s a natural candidate. It would be a natural progression. But you never know. Sometimes it’s somebody from left field.”
Last week’s changes sparked speculation about BET. Since Viacom officially purchased BET in 2001, BET chairman and CEO Robert Johnson and president and COO Debra Lee have reported directly to Karmazin. But with Karmazin’s departure, the two executives will now report to Freston.
Sources close to BET said Johnson in 2000 initially balked at reporting to Freston, who by contract is supposed to oversee the development and/or acquisition of all music-related Viacom networks.
Sources said Karmazin’s departure could also accelerate Johnson’s withdrawal from BET: Johnson’s deal with Viacom ends in 2005, but Johnson could choose to bolt earlier if he chooses.
BET representatives declined to comment. But during a press conference call, Redstone said he had spoken to every top Viacom executive and division chief about the changes and that he “heard no objections.”
For his part, Freston quashed speculation that BET will be melded into MTVN.
“There’s no plan to fold BET into MTV Networks,” Freston said. “I’m talking with Bob and Debra. I’m going down there [to BET’s Washington headquarters] the week after next to meet with them all. I’ve been talking with them in the meantime. I’ve got a meeting with Bob next week here in New York, all the division heads.”
NO SHOWTIME MOVE
Freston added that he doesn’t expect to fold Showtime into MTVN, either.
“I place a good value on smaller business units, individual cultures: I think that way, people feel more involved and impassioned about where they work,” he said. “You could not get a better company culture than what they have down at BET and Showtime, too. Very unique and distinct.
“There’s no need to put everyone together and homogenize them. The cost savings that people dream might be there really wouldn’t be that significant anyway. They’d be far outweighed, I believe, by sort of a lack of entrepreneurial performance.”
Freston added that the idea of consolidating Showtime’s affiliates sales team with MTVN’s has been studied numerous times over the years.
“The affiliate sales groups for these two companies, two divisions, really do very different things,” he said. “It’s a lot more operator-intensive on the pay TV side, where they’re working on individual promotions, so the size of the sales force and the duties that they carry out are vastly different at Showtime or MTV Networks. I don’t believe — we’ve studied this three times now — that anything’s changed. There’s no reason to look at combining them.”
Showtime CEO Matt Blank said he looks forward to his tenure under Freston.
“Tom is one of the most talented executives over the past two decades in the media business,” Blank said. “He’s a good friend and working for him will be great for Showtime and great for me.”
With Karmazin gone, Viacom might become more aggressive about buying cable networks.
SUNDANCE IN SIGHTS?
“We like the cable-networking business,” Freston said. “We might be interested in acquiring certain types of networks, particularly ones that sort of enhance us in certain demos. I don’t think all cable networks are created equal or all are great businesses. But certainly some we’d love, if they were ever to come on the market — we’d be very interested buyers.”
One potential buying opportunity is Sundance Channel, jointly owned by Showtime, NBC and actor Robert Redford. According to published reports, Redford is looking to sell his 20% stake in the network.
Showtime, which now owns 30% of Sundance, declined to comment on Redford’s stake last week, as did Sundance.
Industry insiders suggested Viacom would be interested in acquiring Redford’s Sundance stake, and that networks such as Hallmark Channel, NBC’s Trio, GSN and Cable News Network — which Karmazin publicly coveted — might be good fits for the media giant.
As for Freston’s new job, he said, “I’ve got a good learning curve here, but I’m very excited.”
Said Laybourne: “Here’s a guy who’s 58 years old, and he is still cool. It’s really remarkable. It will be hard to fill those shoes.”