Westinghouse Gives CBS Cos For Optimism

In one whirlwind week, new CBS proprietor Westinghouse Corp. put its own management team in place at the network, made a multimillion-dollar pact with Bill Cosby, predicted rapid reduction of the company’s debt and left the impression that the dark cloud may finally be lifting from Black Rock.

Introducing his new CBS team, Westinghouse chairman Michael Jordan made it clear he was prepared to grow the network’s core business, marking a major strategic shift from the management of former CBS chairman Laurence Tisch.

Moreover, the lively Nov. 28 press conference surrounding the announcement was a stark departure from the long faces at an Aug. 1 gathering to announce the merger, at which Jordan & Co. came off as having little vision of where they were headed with CBS beyond cutting costs.

The difference was made clear when Peter Lund openly tweaked executive VP Leslie Moonves, who heads the entertainment division, about the $5 million payout Moonves received the day the network changed hands. When asked if Westinghouse had committed the funds needed to turn around CBS’ dismal primetime, Lund turned to Moonves, laughed and said, “Sure, but we might have about $5 million less for development.”

It also was evident in the unexpected presence of Cosby, who was in the building to ink a two-year pact with the network for a new sitcom from Carsey- Werner Prods., based on the Brit sitcom “One Foot in the Grave.” The Cosby deal was a clear signal that the new proprietors are willing to spend big to get back in the game.

Indeed, the network agreed to absorb all costs of the show, an unusual arrangement that lets Carsey-Werner off without any deficit financing.

“If there’s any doubt that Westinghouse is ready to spend money, our deal with Bill Cosby should lay that to rest,” said Moonves two days later at another press conference to announce the Cosby pact. “This is a clear signal that we’re ready to do what’s necessary to make CBS No. 1 again.”

Meanwhile, Jordan’s confident perf at the Nov. 28 confab, where he predicted that Westinghouse’s imminent sale of some industrial holdings would make any concerns about debt “disappear,” added to a sense that the new owners are providing a new direction at Black Rock.

Wall Street already has responded to the more positive outlook by pushing up Westinghouse’s stock price over the past month from $13.25 to $17, where it closed Dec.1.

With Westinghouse in charge at CBS, Jordan put forth a blueprint for the beleaguered network that includes the potential for forays into cable, increased program ownership and a greater international presence.

And while Jordan said he thought CBS’ independence from a studio gave it a strategic advantage over ABC and Fox, he did not rule out some form of alliance with a studio partner.

Merged management

Implementing the new blueprint will be a merged management team that incorporates key Westinghouse broadcast executives atop the network’s lucrative owned-and-operated stations, but led by Black Rock veteran Lund, who reports to Jordan. Also reporting to Jordan will be Donald H. Mitzner, president of Group W Satellite Communications, who will head CBS’ expansion in cable TV and overseas markets. Besides Moonves, Lund’s other exec VP will be Bill Korn, former chairman-CEO of Westinghouse Broadcasting Co., who has been installed as president of the CBS Stations Group, in charge of 15 TV and 39 radio stations.

Reporting to Korn will be Westinghouse veterans John Klein, president of CBS Television Stations, replacing Johnathan Rodgers, and Dan Mason, president of the CBS Radio Group, replacing Nancy Widman. Mason’s group is likely to expand, as Jordan said CBS is trying to buy more stations.

Jobs on the line

Other changes at the division-head level likely will be coming next month. Though Jordan mentioned CBS’ other division presidents – News’ Eric Ober, Sports’ Dave Kenin and CBS Network president Jim Warner – Lund indicated that potential changes were in the works when he said he would begin meeting with division managers individually to share his plans and to hear theirs for the new CBS. “When we get through with that process, we’ll decide if the right people have the right jobs, ” Lund said.

Lund and Jordan said there may be layoffs in departments where there is duplication, such as human resources and legal. But Jordan was quick to add, “All those savings won’t automatically go to the bottom line, but will help us have the resources to grow the company.”

With a new executive team in place, CBS has put its first priority on refurbishing its primetime lineup. It’s an agenda being set by Jordan.

“Thirty-five to 40% of our revenue on the station side is driven by primetime and latenight ratings, and that is where the money is, ” Jordan said.

No easy alibis

Lund set the tone for a new beginning at CBS, refusing to find easy alibis for the network’s dismal performance this season.

Lund said the network could not blame its poor primetime showing on the affiliate switches the network had suffered, including being pushed onto weaker stations in such key markets as Detroit and Atlanta.

“We don’t have a distribution problem; in fact, our distribution system is one of our strengths,” said Lund, noting that CBS still has more coverage on VHF stations than either ABC or NBC.

Moonves, who joined the network in July, continued in the same vein of candor when he admitted the web had made a key strategic error in how it marketed itself, and said he was charting a new course. “We tried to get too young too fast,” he said.

Two-year target

Moonves said it would take two years to turn primetime around and that future development would focus on the kind of sophisticated comedies and dramas that made the network’s Monday lineup a success, as well as such populist fare as “Walker, Texas Ranger,” the web’s Saturday hit.

Moonves said there would be no major changes in CBS’ schedule until next season. Asked about the network’s children’s programming commitment, which was a hot topic in terms of Federal Communications Commission approval of the merger, Moonves said the network had just given a two-year pickup to the scienceoriented Saturday-morning show “Beakman’s World.” He also acknowledged discussions about an alliance with DreamWorks, but indicated no deal was imminent.

Indie badge

While Jordan and his new team are exploring possible studio alliances, they also are spinning their independence as a programming advantage. “Some of our competition has pretty much said to independent suppliers, ‘ You’re not wanted here,'” Moonves said in an obvious reference to Fox and the Disney-ABC merger. “We’re saying we don’t care if you’re the man in the moon; if you have a good show, let’s do business.”

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