Sumner Redstone

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Sumner Redstone
Born Sumner Murray Rothstein
May 27, 1923
Boston, Massachusetts, United States
Died Script error: The function "death_date_and_age" does not exist.
Los Angeles, California, United States
Nationality USA
Occupation Chairman of National Amusements
Executive Chairman of the Board of Viacom and CBS Corporation
Net worth Decrease US$5.3 billion (September 2015)[1]
Spouse(s) Phyllis Gloria Raphael (1944–1999; divorced)
Paula Fortunato (2002–2009; divorced)
Children Shari Redstone
Brent Redstone
Parent(s) Belle Ostrovsky
Michael Rothstein
Relatives Kimberlee Korff
Brandon Korff
Tyler Korff

Sumner Murray Redstone (born Sumner Murray Rothstein; May 27, 1923 - August 11, 2020) was a Jewish-American billionaire businessman and media magnate. He was the majority owner and Chairman of the Board of the National Amusements theater chain. Through National Amusements, Redstone, along with his family, was a majority owner of CBS Corporation and Viacom (itself the parent company of Viacom Media Networks, BET Networks, and the film studio Paramount Pictures), both of which merged in 2019 (the year before his death) to create ViacomCBS, which is now led by his daughter, Shari Redstone. According to Forbes, as of March 2014, he was worth US $6.2 billion.[1]

Early life and education

Sumner was born to a Jewish family[2] in Boston, Massachusetts, to Belle (née Ostrovsky) and Michael Rothstein. In 1940, his father changed the family surname from "Rothstein" to "Redstone"[3] ("Red stone" is a literal translation of the German-Jewish name, "Rothstein").[4] Michael Rothstein owned Northeast Theater Corporation in Dedham, Massachusetts—the forerunner of National Amusements[5]—and the Boston branch of the Latin Quarter Nightclub.[6]

Redstone attended the Boston Latin School, from which he graduated first in his class. In 1944, he graduated from Harvard College,[3] where he completed the studies for his baccalaureate in three years. Later, Redstone served as First Lieutenant in the United States Army during World War II[3] with a team that decoded Japanese messages.[7] After this military service, he worked in Washington, D.C., and attended Georgetown University Law School. He transferred to Harvard Law School and received his LL.B. in 1947.[3]

After completing law school, Redstone served as special assistant to U.S. Attorney General Tom C. Clark (who later served as Associate Justice of the Supreme Court of the United States from 1949 to 1967)[3] and then worked for the United States Department of Justice Tax Division in Washington, D.C. and San Francisco, and thereafter entered private practice. In 1954, he joined his father's theater chain, National Amusements and in 1967, he became CEO of the company.[3] As the company grew, Redstone came to believe that content would become more important than distribution mechanisms: channels of distribution (in varied forms) would always exist, but content would always be essential (Redstone coined the phrase, "Content is king!"[8]). He invested in Columbia Pictures, Twentieth Century Fox, Orion Pictures, and Paramount Pictures (Redstone's Viacom would buy Paramount in the 1990s), all of which turned over huge profits when he chose to sell their stock in the early 1980s.

In 1979, he suffered severe burns in a fire at the Copley Plaza hotel, in Boston, but survived after thirty hours extensive surgery at Massachusetts General Hospital. Though he was warned that he might never be able to live a normal life, eight years later he was fit enough to insist on playing tennis nearly every day and to launch a hostile takeover of Viacom.[9] Redstone has discussed the story of surviving the fire as a reflection of his strong determination and will to live.[10]

Career

Viacom

Looking for a new business venture, he set his sights on Viacom International, a company which he had already been buying stock in as an investment and was a spin-off of CBS in 1971 after the FCC ruled that television networks could not syndicate programs following their network run. Viacom syndicated most of CBS's in-house productions (such as Hawaii Five-O and Gunsmoke, as well as the pre-1960 Desilu Productions library which CBS acquired in 1960, I Love Lucy being among the acquired 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, as was MTM Enterprises' The Mary Tyler Moore Show), and cable channels (Nickelodeon's Double Dare and Finders Keepers (co-syndicated with 20th Television) were two examples).

Viacom also owned MTV Networks (formerly known as Warner-AMEX Satellite Entertainment), which owned MTV and Nickelodeon. In addition, other 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 of a studio owning cable channels would be a conflict of interest. The studio's stance changed in 1995, when as Time Warner it bought Turner Broadcasting.)

After a four-month hostile takeover in 1987,[11][12] 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 Bertelsmann, News Corporation, Time Warner, Sony, Disney, and NBC Universal (owned by Comcast).

Paramount Pictures

Redstone's next acquisition was the purchase of Paramount Communications (previously Gulf+Western), parent of Paramount Pictures in 1993. He engaged in a bidding war with Barry Diller (former board member of Vivendi Universal and CEO of IAC/InterActiveCorp) and John Malone (president of TCI/Liberty Media), and had to raise his bid three times. Some say that Redstone overpaid, but after he shed certain assets — the Madison Square Garden properties (which included the NBA's NY Knicks and the NHL's NY Rangers) to Charles Dolan's Cablevision and Simon & Schuster's educational publishing units to Pearson PLC — for almost $4 billion, Redstone turned Viacom's expenditure into a substantial profit. Under Redstone's leadership, Paramount went on an almost ten-year streak of record performance, producing such films as Saving Private Ryan, Titanic (one of the highest grossing film of all time and Best Picture Academy Award winner),[13] Braveheart (Best Picture Academy Award),[14] and Forrest Gump (also a Best Picture winner)[15] and the creation of the hugely successful Mission: Impossible[16] series of pictures.

Redstone replaced the team of Jonathan Dolgen and Sherry Lansing in 2004 after their nine-year winning streak ended.[17] Along with the strong slate of films they oversaw, Dolgen and Lansing’s accomplishments included: doubling the size of Paramount's music publishing division, Famous Music; expanding UCI Cinemas into 13 foreign countries; creating the Digital Cinema Initiatives standards body for the new digital film technology; and launching the UPN Network (later part of CBS and now called the CW). The current Paramount Pictures consists only of the movie studio, the other groups having been sold or parceled out to other divisions.

Since arriving at Paramount in 2005, Chairman and Chief Executive Officer Brad Grey has led a return to fortune at the box office.[18][19] He has overseen the creation or revitalization of several major franchises, including Transformers, Star Trek and Paranormal Activity.[20] Paramount has also forged productive relationships with top-tier filmmakers and talent including J.J. Abrams,[21] Michael Bay[22] and Martin Scorsese.[23] The 2010 Paramount slate achieved much success with Shutter Island and a True Grit remake, reaching the biggest box office totals in the storied careers of Martin Scorsese and the Coen Brothers, respectively.[24][25] In addition, during Grey’s tenure, Paramount launched its own worldwide releasing arm, Paramount Pictures International, and has released acclaimed films such as An Inconvenient Truth, Up in the Air, and There Will Be Blood.[26]

The Paramount acquisition was only the tip of the iceberg. He 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. Redstone acquired CBS Corporation in 2000 and then spun it off as a separate company in 2005, taking with it all of Paramount's television shows and catalog. Following the CBS and Blockbuster Spinoffs, Viacom consists of MTV Networks (MTV, Nickelodeon, VH1, Noggin etc.), music publishing (Famous Music) and Paramount Pictures.

In December 2005, Redstone announced that Paramount had agreed to buy DreamWorks SKG for an estimated $1.6 billion. The acquisition was completed on February 1, 2006. A subsequent financing brought Viacom's investment down to $700 million. The animation studio, DreamWorks Animation, was not included in the deal as it has been its own company since late 2004. However, Paramount now has the rights to distribute films by DreamWorks Animation.

On June 1, 2012, Paramount Pictures renamed the Administration Building on the studio lot the Sumner Redstone Building in a dedication ceremony attended by employees of Paramount Pictures and Viacom.

CBS

One of Redstone's largest acquisitions came in the form of Viacom's former parent, CBS. Former Viacom President and 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, VH1, 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, 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.

After CBS and Viacom split in late 2005, Redstone remained chairman of both companies. They ultimately remerged in 2019 to create ViacomCBS, with Redstone still as chairman, before his death the following year.

Succession

Redstone's trusts made it clear that his daughter, Shari Redstone (Vice-Chairwoman of the Board of Viacom and CBS as well as President of National Amusements), was set to assume his role upon his death, which she ultimately did so. However, a November 22, 2006, New York Times article indicated that Redstone was reconsidering his daughter's role. In 2007, they feuded publicly over issues of corporate governance and the future of the cinema chain.[27]

Documents were made public which verified that, as part of a settlement from Sumner's first divorce, all of Sumner's stock was in irrevocable trusts that was left for his grandchildren.[28] On March 1, 2010, Sumner publicly announced that all of his stock will be left for his grandchildren (Kimberlee Korff, Brandon Korff and Tyler Korff).[29]

Redstone made arrangements to step down as CEO of Viacom in 2006. After Mel Karmazin resigned in 2004, two heirs apparent were named: Co-President and Co-COO Leslie Moonves (who was number 2 to Karmazin at CBS; he was the former head of Warner Bros. Television and before that, Lorimar Television) and Co-President and Co-COO Tom Freston (who had been President and 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 the Viacom split, Moonves has headed CBS, and Freston had headed the new Viacom, Inc.

When Moonves was promoted to Co-President and Co-COO with Tom Freston, there was speculation that he was on the short list of executives to replace Michael Eisner at the Walt Disney Company whose contract expired in 2006.[30] Redstone has confirmed publicly in Vanity Fair that he originally offered the position only to Freston who initially turned it down and later relented when Redstone made it clear he was going to ask Moonves next.

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. He also brought back former CFO Tom Dooley. 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.[31][32]

The company split was approved by the Viacom board on June 14, 2005.

Holdings

At the time of his death, Redstone owned over seventy percent of the voting interest of Viacom. Viacom and CBS Corporation, both of which merged in 2019 (the year before Redstone's death) to create ViacomCBS, were both controlled by Redstone through National Amusements. Redstone sold his holdings of Midway Games, of over 89%, in December 2008.

Books

Redstone's autobiography, A Passion to Win[33] (co-written with author Peter Knobler), was published in 2001 by Viacom's Simon & Schuster. This book details everything from Redstone'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. The book also recounts 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).

Viacom's broadcasting properties at the time of A Passion to Win'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 four years before Viacom and CBS merged, and WSBK UPN 38 in Redstone's hometown, Boston.

Political views

A longtime Democratic supporter, with a history of donating to many Democratic campaigns, including regular donations to the late Ted Kennedy, John Kerry, and former Senate Majority Leader Tom Daschle,[34] Redstone endorsed Republican George W. Bush over Kerry in the 2004 Presidential election, allegedly because he argued that Bush would be better for his company and the economy.[35] Despite this public endorsement, he donated money to Kerry during the primaries.[citation needed]

Philanthropy

Sumner Redstone contributed over $150 million, 1.7% of his estimated net worth, to various philanthropic causes.[36]

  • In April 2007, Sumner M. Redstone announced a commitment of $105 million in charitable grants to fund research and patient care advancements in cancer and burn recovery at three major non-profit healthcare organizations. The cash contributions of $35 million each will be paid out over five years to FasterCures/The Center for Accelerating Medical Solutions, based in Washington D.C.; the Cedars-Sinai Prostate Cancer Center in Los Angeles, California; and the Massachusetts General Hospital in Boston, Massachusetts.[37]
  • Over the last few years, Redstone has contributed $1.5 million to the Global Poverty Project.[36]
  • He has given millions of dollars to the Cambodian Children's Fund, a nonprofit program that provides a wide range of critical health and educational services to impoverished and abused children in the capital city of Phnom Penh.[38] Redstone's contribution will be used to create the Sumner M. Redstone Child Rescue Center, a stand-alone facility scheduled to open during the fall of 2007 for children 5 to 16.[39]
  • In early 2010, Autism Speaks announced that Sumner Redstone made a $1 million donation to be applied to scientific research into autism's causes, improved treatments, and, ultimately, its cures. Part of the gift will support Autism Speaks' programs for children, adults, and families. While Redstone has supported Autism Speaks since 2007, this is his largest gift to date.
  • In July 2010, Redstone donated $24 million to the Keck School of Medicine of the University of Southern California to support cancer research.[40]
  • In September 2012, Redstone donated $18 million to the Boston University School of Law. The gift will, in part, fund the construction of a new building to be named after him.[41]
  • From October 2012 until his death, Redstone donated a total of $350,000 to the Go Campaign, which funds projects in 21 countries with a focus on helping orphans and other needy children.[42][43]
  • In May 2013, Redstone donated $1 million to Literacy Inc., a grassroots literacy organization in New York City.[44]
  • In January, 2014 it was reported that Redstone had donated $10 million to Harvard Law School for public-interest fellowships. The gift was the largest charitable contribution ever to the law school in support of public service. The money supported students who work in public interest positions after graduation.[45]

Personal life

In 1947, he married Phyllis Gloria Raphael.[46] In 1999, they divorced. They had two children: Shari Redstone and Brent Redstone. Three years after his divorce, he married Paula Fortunato, a former primary school teacher 39 years his junior. Sumner Redstone filed for divorce from her on October 17, 2008.[47] Their divorce was finalized on January 22, 2009. Redstone owned a house in the Beverly Park area of Beverly Hills, California, which he purchased in 2002 for $14,500,000.[48]

In July 2010, Redstone was caught on tape, trying to find the source of an apparently embarrassing leak within his own MTV. Redstone offered money and protection to a journalist if he would give up his source. Apparently Mr. Redstone had been pushing MTV management to give more airtime to a girl band called the Electric Barbarellas. On the message, Redstone tells the reporter that "we're not going to kill" the source, adding "We just want to talk to him". The 87-year-old Redstone also tells the reporter he will be "well rewarded and well protected" if he gives up the source.[49] Peter Lauria told NBC's Today show he wouldn't do it. Viacom Inc. spokesman, Carl Folta confirmed to Today that it was Redstone's voice on the message and said the mogul had made a mistake.[50] A Viacom source tells the Post, "Sumner wants to be consequential. Sumner is really proud of what he did. This guy is loving it … He likes people to know he's still alive".[51]

Death

Redstone died on August 11, 2020, at the age of 97.[52]

References

  1. ↑ 1.0 1.1 Lua error in package.lua at line 80: module 'strict' not found.
  2. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  3. ↑ 3.0 3.1 3.2 3.3 3.4 3.5 Lua error in package.lua at line 80: module 'strict' not found.
  4. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  5. ↑ Weddings/Celebrations: Paula Fortunato, Sumner M. Redstone, The New York Times, April 6, 2003
  6. ↑ [1][dead link]
  7. ↑ Cf. "The Highwaymen" by Ken Auletta. Auletta also wrote that Redstone finished his Harvard undergraduate degree in two and a half years.
  8. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  9. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  10. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  11. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  12. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  13. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  14. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  15. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  16. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  17. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  18. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  19. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  20. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  21. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  22. ↑ [2] Archived January 3, 2011 at the Wayback Machine
  23. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  24. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  25. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  26. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  27. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  28. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  29. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  30. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  31. ↑ [3][dead link]
  32. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  33. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  34. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  35. ↑ [4][dead link]
  36. ↑ 36.0 36.1 Lua error in package.lua at line 80: module 'strict' not found.
  37. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  38. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  39. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  40. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  41. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  42. ↑ [5][dead link]
  43. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  44. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  45. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  46. ↑ New York Post: "VIACOM MOGUL COULD BE SUMNER $QUASHED" By Jeane MacIntosh September 19, 1999
  47. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  48. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  49. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  50. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  51. ↑ Lua error in package.lua at line 80: module 'strict' not found.
  52. ↑ https://www.nytimes.com/2020/08/12/obituaries/sumner-redstone-dead.html

Further reading

External links

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