MEMO TO SUMNER REDSTONE:
Where are you when we need you, Sumner?
You used to thrive in this sort of chaotic media environment, with takeover rumors rampant and harried bankers shuttling between meetings. But you’ve let Rupert Murdoch, your longtime rival, not only grasp centerstage but also rewrite his dynastic history, which only a year ago was locked in unsavory court battles over phone hacking at his British tabloids.
Indeed, family dynasties seem to dominate the industry today — the Murdochs, the Roberts, the Dolans et al. I can almost visualize the ghosts of patriarchs past emerging from the shadows. They, too, understood loyalty to “the family”; Jack Warner would yell at his brothers, and Darryl Zanuck even once fired his son, but the sense of dynasty survived through that era.
But it’s your empire, Sumner, that seems oddly somnolent at the moment. The Paramount studio is committed to its own version of austerity — an objective of achieving profits without pictures that would have confounded the Warners or Zanucks. Even CBS Films seems to have stalled out, a phenomenon that is inconsistent with Leslie Moonves’ level of hyperactivity. Wall Street dealmakers are reminding Moonves that if he wants to maintain a presence in the movie business, acquisition represents a more promising option.
At your ripe young age of 91, you’ve been working diligently on your philanthropic legacy, Sumner, but I’d welcome some input on your corporate legacy. It was eight years ago that you became so angry about losing a prospective takeover to Rupert that you fired your then president, Tom Freston. Of course, the company in question, MySpace, was dumped by Rupert for $550 million less than he paid for it. Back then you were in a feistier mode, Sumner — you even fired Tom Cruise.
Rupert never seems to worry much about his mistakes, however. He just keeps levitating new deals, defying the laws of gravity. Of course, Brian Roberts doesn’t worry if he’s paying too much for Time Warner Cable or whether federal regulators will reject the deal. And James Dolan has never fretted about a performance review at Cablevision from his father (or from Knicks fans).
And no one ever second-guessed you, Sumner, back in the era when you were crafting your Paramount takeover, leaving Barry Diller and others bobbing in your wake. You were fearless in raising the ante at the crucial time.
That’s now what’s facing your pal, Rupert. He may have to raise his $85-per-share offer for Time Warner to $95 or more, with perhaps a 40% injection of cash. No one can accuse Rupert of running short of capital — he reportedly has lined up a $25 billion loan from Goldman Sachs and JP Morgan, and may also finalize a $9 billion deal to sell his interest in two Euro satcasters (in Germany and Italy). At the same time, Rupert remembers his nightmare in the early ’90s when his appetite so overextended his resources that it looked as though he and his sons would have to find an alternative career path.
Clearly neither you nor Rupert, Sumner, have career worries at the moment, unlike the people who work at your sprawling empires. Hollywood knows that consolidations are in the works and, with them, the inevitable layoffs and management purges. The Hollywood of old was kinder to its families — employees, not just owners — ensuring generations of rewarding jobs. Yes, there have been below-the-line dynasties, too.
I was with you at your home one day, Sumner, as we stared at the giant fish tank in your study. “What I love about this tank is that nothing ever changes,” you observed. “They all just keep swimming upstream.”
That zone of serenity, as you well know, no longer extends to the community at large.