Viacom will weather blurb dip, Mel sez

Next big layoff won't come from him, topper sez

While some media congloms are trimming personnel to weather tough economic times, Viacom’s Mel Karmazin is turning to division heads to overcome them.

Karmazin said Wednesday at a Hollywood Radio and Television Society Newsmaker Luncheon in Beverly Hills that the next big corporation-wide layoff announcement will not be coming from Viacom.

Karmazin said his job is “to make sure that things are done for the right reasons and that his divisions heads have the resources to do what they want.”

Hitting upon a wide range of topics, Karmazin said in his interview session with George Stephanopoulos that the ad market’s sluggish appearance this year is exaggerated; that newspapers — not other entertainment companies — are his real competish in luring ad market share; and that he is hopeful about the future of UPN.

“I never understood how companies found themselves in a position where they could let 4,000 people go,” Karmazin said of the first topic of the afternoon, the word Tuesday that the Walt Disney Company would be laying off 4,000 of its 120,000 employees.

“Freeing salaries and workforce — that’s not how to run a business. You need solid executives who decide how to run their division. I can’t imagine sending a note to these people telling them how to run their organization,” Karmazin said, in front of a dais whose guests included 13 of the highest-ranking Viacom execs.

It should be noted that cable net Nickelodeon and the CBS TV station group, both Viacom companies, have looked toward their staff in recent belt-tightening efforts (Daily Variety, March 26).

Karmazin addressed a handful of other issues:

  • He reiterated his recent characterizations of the nation’s economy as healthier than others have assumed.

    Last year’s boom in ad rates, due to unprecedented spending by dot-coms, has given an artificial point of year-to-year comparison and a false sense of gloom, he said.

    “If we compared ad revenue with two years ago, we would see vast improvement, but if we compare today with a year ago, which is what Wall Street and a lot of us do, we’re comparing to an abnormal year,” he said.

  • As far as competish goes, Karmazin said he sees fellow entertainment congloms as brethren. What’s good for entertainment companies is good for the sector in general, he said. His real adversary in ad market share, is the newspaper biz, he said.

    “The No. 1 place people spend more money advertising is in newspapers, but young people aren’t getting their information there,” he said. “My sense is not that I’d like a bigger share of the TV ad business Disney gets; I want to see TV get a bigger share of the pie by taking share from newspaper ads.”

  • Karmazin added that he’s not a big supporter of the advertising model for the Internet.

    “Yahoo said it won’t make money in 2001, and it’s not because they’re all taking private jets. It’s a great brand, a functioning brand, with 185 million users. If they can’t do it, I find it hard to believe anyone can,” he said.

    “Efficiences created within a company is where the Internet will be useful,” he added. “Maybe it will be like the phone, where you can’t live without it, you make more money because of it, but not many people make money with it.”

  • Responding to picketers, who rallied outside of the Beverly Regent Hotel during the HRTS event against the firing of BET talk personality Tavis Smiley, Karmazin said it was their right to exercise free speech.

    However, despite the fact that Viacom recently purchased BET, Karmazin said he had nothing to do with and no knowledge of the firing, contrary to speculation.

    Rather, the decision was made by Robert (Bob) Johnson, chairman-CEO of BET, and Debra Lee, prexy-chief operating officer of BET.

    “I find it disrespectful that someone would believe that Bob, who founded BET and built it into what it is, would not have the authority to make this change,” Karmazin said.

  • Karmazin also said Viacom’s UPN network continues to meet with Fox’s TV stations, and that he’d be open to a scenario in which Fox might take an ownership role in the netlet in order to ensure UPN’s longevity.

  • Karmazin addressed relations between CBS and its station affils in light of the currently tenuous network-station climate, as ABC, Fox and NBC recently canceled their annual meetings with affils and as many affil stations are fervently opposed to Viacom’s attempt to get the Federal government to raise the TV station ownership cap.

Karmazin said “our relationships suck a little less than other networks.”

Unlike the other major broadcast nets, CBS still is planning on holding its affiliate meeting in May.

However, in a letter this week to CBS affil G.M.s and group owners confirming the meeting, CBS affil relations prexy Peter K. Schruth wrote that CBS intends to “reformulate” the current Affiliate Advistory Board, which, Schruth wrote, has not performed its primary function to advise the network and the affiliate body.

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