With reduced role, Dolgen steps aside

This article was updated at 9:10 p.m.

Paramount co-head and chairman of the Viacom entertainment group Jonathan Dolgen resigned abruptly Wednesday afternoon, saying the new management structure of parent Viacom left him without a role.

Dolgen’s resignation is effective July 15.

With Paramount in the midst of a reinvention toward pricier, higher-profile projects, longtime studio chief Sherry Lansing is expected to remain at the helm. To assume some of Dolgen’s duties, the company may be looking for a financially savvy film exec to work with Lansing.

Lansing received assurances from Viacom chairman-CEO Sumner Redstone that no one would be put between her and Tom Freston, who now oversees the studio as part of his expanded brief.

Dolgen’s departure ends a decade-long partnership with Lansing — one of the town’s longest alliances among studio toppers.

The ankling came a day after news that Viacom chief operating officer Mel Karmazin had stepped down and that Karmazin’s role overseeing all Viacom divisions was being split between CBS chief Leslie Moonves and MTV Networks topper Freston. Among their other responsibilities, Moonves was given oversight of Paramount television and Freston oversight of its feature films — essentially marginalizing Dolgen.

Execs at the studio weren’t informed of the changes until the weekend, just before they were made public.

“There was no appropriate role for me in the new structure,” he told Daily Variety. Dolgen, 59, has been at Par since 1994 following stints at Sony, Fox and Columbia.

His fate was likely sealed Tuesday when the management shakeup at Viacom was unveiled and heralded by Redstone and his lieutenants as the dawn of a new creative age for the conglom. Given the history of testy relations between Freston and Dolgen, the latter’s departure had been viewed as only a matter of time.

Dolgen, an astute businessman and former Wall Street lawyer, was perceived above all as tightfisted, with an aversion to expensive projects and as one who engaged in tough-as-nails negotiations with top talent, punctuated by last-minute revisions.

He was best known for implementing Paramount’s strategy of hardball dealmaking with an eye not on market share but on the bottom line. As a result, the studio stressed middle-of-the-road projects, split financing and an occasional surefire tentpole such as the two “Mission: Impossible” pics.

The approach worked well for the studio until recent years when the bottom-line mentality appeared to undercut Par’s ability to attract top projects and talent.

Co-financing packages and other vehicles Dolgen cultivated to reduce risk were, and still are, widely admired and copied by other studios, but they seemed to backfire at Paramount as the studio suffered a string of box office disappointments in recent years.

“Essentially, the studio, in my opinion, did not have enough money to make the pictures they should have made. Risk-averse is good, but too much risk-averse is bad,” Redstone told Daily Variety.

“Sherry (Lansing) told me that the creative community would not come to (Paramount) if a picture cost $100 million, because they thought it was too much. I told her to change the message…’Come to us. Send us a script,’ that’s the message,” he added.

Dolgen, while stoic about his departure, feels he’s been unfairly labeled in recent months as penny-pinching. He acknowledged that co-financing was a frequent tool but indicated that it was driven in large part by corporate pressure for “cash and profits.”

Otherwise, Dolgen said, he would have not been as eager to co-finance Paramount projects.

As for his future, Dolgen told Daily Variety, “I’ve got a chance for one more chapter — and I want one more chapter.”

Hollywood insiders said Dolgen’s departure wasn’t a surprise. But they were caught off guard by the rapidity of his ankling.

Television role

With Moonves taking on oversight of Paramount’s network TV and syndie units, Dolgen had also lost oversight of the studio’s small screen assets. It’s also well known the relationship between Dolgen and Moonves was chilly at best.

As a result, few Par-produced shows had made it onto CBS air in recent years.

Dolgen had already been marginalized to some degree, having lost oversight of Viacom netlet UPN in 2002, when Moonves took it over. Dolgen had been previously been regarded as somewhat of an absentee landlord at the weblet, which struggled through several years of disappointing ratings.

Execs and agents continued to take a wait-and-see attitude as to whether further changes are afoot but note that Paramount has been working assiduously to shed its image as the town’s most cautious studio, both fiscally and artistically.

More than two and half years have passed since Par’s last major hit, “What Women Want,” whose U.S. gross topped $180 million. Since then, the studio has released just three films that topped $100 million in domestic box office: “The Sum of All Fears,” “How to Lose a Guy in 10 Days” and “The Italian Job.”

Redstone gave a clear indication that changes were afoot in March when he told a Bear Stearns investment conference that Paramount would get the money it needed: “Some degree of risk aversion is good, but if you’re not a risk-taker, you can’t make any money.”

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