Top exec trio will now report to Viacom CEO Philippe Dauman

Judy McGrath’s legacy at MTV Networks will be her role in helping to shape youth culture over the past three decades, but her resignation as CEO signals a new era in which execs at parent Viacom will exert far more influence at the cable group that was once the fiefdom of McGrath and a tight-knit group of creative execs.

The departure of McGrath, announced Thursday, marks the exit of the last senior executive who was part of the startup team when MTV launched in 1981 as a bold experiment of putting musicvideos on TV.

Viacom said a successor would not be named. Instead, McGrath’s key deputies — Doug Herzog, president, of MTV Networks Entertainment Group, Van Toffler, president of MTV Networks Music & Logo Group and Cyma Zarghami, president, Nickelodeon & MTVN Kids & Family Group — will reportdirectly to Viacom topper Philippe Dauman. The CEO job at MTV Networks was always seen as the layer between corporate and the creative culture that continues to be a point of pride among MTV staff.

“Judy has long been the creative heart and inspiring soul of MTV Networks and has deservedly been associated with so much of the great entertainment, cultural relevance, social significance and business success that have defined our media networks over the years,” said Dauman. “Her positive and passionate spirit has helped create an organization that is recognized for truly listening to its audiences, not only about their entertainment choices, but also about the social issues and the causes that matter to them most.”

McGrath rose from copywriter through the ranks to become CEO in 2004, succeeding her longtime boss Tom Freston and joining the small circle of femme CEOs in showbiz. “The people of MTV Networks have always been singularly important to me,” McGrath said in a statement. “Together we have built world-class brands that connect with fans from kid to adulthood, from SpongeBob to ‘Hot In Cleveland,’ from ‘Unplugged’ to ‘The Daily Show.’ We have attracted and nurtured the best talent in the world, and I know that will always be a hallmark of the company. Creatively, financially, all the brands and businesses are in wonderful shape today. I leave with pride, joy and gratitude for the ride of a lifetime.”

It is not clear what McGrath will do next. Since her compadre Freston was fired abrubtly by Viacom chairman Sumner Redstone in 2006, McGrath contemplated leaving the company herself, said a company source. “It just wasn’t as much fun for her.” It was also rumored that during a ratings slump right after Freston’s firing that McGrath, too, may be the next to be shown the door. McGrath perservered and MTV is now in a ratings resurgence, helped by such shows as “Teen Mom” and, of course, “Jersey Shore.”

At 58, McGrath now joins the club of other departed MTV founding execs, including Freston, Bob Pittman, Mark Rosenthal, Robert Friedman, Robert Morton and John Sykes who helped build a single channel into one of the industry’s biggest portfolio of basic cablers. MTV Networks represents the vast majority of Viacom’s revenues, greatly overshadowing BET and Paramount. Viacom shares were off 16¢ Thursday to $58.18, along with a dip in the broader market.

It may be that McGrath saw her 30th anniversary at the company as the right time to exit. “You know Judy and Philippe were not the perfect match after all,” said one industry insider. “He is an estate lawyer and she is the classic creative executive. This subsumes MTV Networks into Viacom and gives Philippe all the control.”

Former colleagues on Thursday praised her tenure and collegial management style. “Judy is the last of the original team at MTV. Although she began as ‘the writer’ on the team, Judy has had more impact on MTV than any of us,” Pittman, who recruited her to MTV and who now serves as chairman of media and entertainment platforms at Clear Channel, told Variety on Thursday. “From the beginning she created the language that set the attitude that was MTV. Over time, she did the same with the on-air look, the programs and the network overall. She brought those same values to the creation of the culture of the company and how it did business with the creative community, advertisers and partners. And she did it all with grace and great success. She was the keeper of the vision.”

MGM board member Jason Hirschhorn, who once served as MTV Networks’ chief digital officer under McGrath, said “Judy McGrath wanted to know everyone who worked for her. And she championed women in the exec suite like no one else. Judy McGrath’s next chapter will be interesting. She isn’t done. Not nearly. I’m buying tickets for the sequel.”

After growing up in Scranton, Pa,, McGrath came to New York and landed her first media job as a writer for Mademoiselle before eventually joining MTV to pen on-air promotions. In describing her passion for pop culture and an ability to be ahead of new trends, a friend once said McGrath was “a 16-year-old boy in an adult woman’s body.”

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