Viacom put an end to months of speculation about who would oversee TV production, distribution and broadcasting operations at the newly merged company by naming Paramount TV Group chairman Kerry McCluggage as the studio’s television czar on Thursday.
The new Paramount owner folded Viacom’s TV and radio operations under the control of McCluggage, who will also oversee Par’s fifth network effort.
McCluggage won the job over Viacom Entertainment Group head Neil Braun, who previously held the title of Viacom Entertainment Group chairman/CEO.
But new Viacom Entertainment Group chairman Jonathan Dolgen, whose appointment overseeing the combined Par-Viacom entity was officially announced Thursday along with that of Par Motion Picture Group chairman Sherry Lansing, insisted that there willbe a place for Braun in the new company.
“We are old friends and there will be plenty of opportunity for him with anything this company is involved in,” Dolgen said.
Thursday’s announcement made no mention of Viacom’s cable networks (including Showtime Networks and MTV Networks), or its MSO holdings.
TV executives at the companies have been on edge in recent weeks, waiting for an inevitable shakeout as the new corporation seeks “efficiencies.” With top execs now in place, that is likely to begin within the next month.
Viacom chairman Sumner Redstone made it clear Thursday that he and Viacom president/CEO Frank Biondi never had any doubt about who would get the key high-level executive positions.
“In each case, Jon, Sherry andKerry were our first choices among an extraordinarily talented field,” he said in a statement. Biondi credited Lansing with rebuilding Par’s motion picture wing and McCluggage, who joined the studio as TV group head in June 1991 after heading TV operations at Universal for four years, with advancing Par to the “preeminent position” in TV production and distribution.
Biondi once again endorsed the Par/Chris-Craft weblet effort, saying that McCluggage “has surpassed the most ambitious expectations for building a fifth network.”
McCluggage and Dolgen said they haven’t decided how the merged TV unit will be structured. “We will be trying to come up with a strategy that rationalizes opportunities and makes the most sense,” McCluggage said. He noted that he will “try to figure out a structure so that all the best people can still be here.”
Sources said they expect the TV restructuring plan to take about 30 days to complete.
On the network production side, Viacom is a relatively small operation compared to Paramount Network TV, and most expect its assets and staff — which include the series “Diagnosis Murder,””Matlock” and the “Perry Mason” movies — to be absorbed into Paramount.
“I don’t see why they would keep that going” separately, said one TV source, citing consolidation within the last year of overlapping units at Warner Bros. (WB TV and Lorimar) and Sony Pictures Entertainment (Columbia and TriStar).
McCluggage is expected to keep his two former Universal colleagues overseeing production. Dick Lindheim serves as exec VP of the Par TV group and Garry Hart is president of Par Network TV.
Perry Simon, formerly the No. 2 man at NBC Entertainment, is currently president of Viacom TV — having taken that job last September, only days before the Viacom-Paramount merger was first proposed. Because of his network background, sources speculate that Simon could be involved in the fifth network operation if his unit gets folded into Paramount.
One production unit expected to remain distinct is Spelling TV, which would come under the Viacom heading through the merger with Blockbuster Entertainment. The Spelling name has value overseas, and will likely continue to function essentially as an independent.
From a distribution standpoint, the combined entity ranks second among the leading primetime suppliers, topped only by Warner Bros.
The most likely place for immediate cutbacks would be distribution, which offers the most obvious economies of scale — that is, it’s as easy for one regional salesman to sell 10 shows as it is five. Also, it would prevent two sister companies from introducing similar shows that are competing for the same time periods.
McCluggage is expected to gain control of both the Republic and Worldvision distribution units once the Blockbuster merger with Viacom is sorted out.
A source familiar with the merger said there is “still a lot of behind-the-scenes maneuvering” concerning how the Worldvision and Republic units would be absorbed into the new company if the merger is completed. The goal, however, is to have only one TV division.
Citing Dolgen’s past experience — as well as the debt load associated with the Paramount acquisition — observers said he would clearly be looking to cut the fat out of the combined operation and eliminate duplication wherever possible.
Budget slicing feared
“He’s a notorious budget-cutter,” one source noted.
But Dolgen said he hasn’t figured out what he will do yet. The deal to bring him from Sony to Viacom didn’t come together until Monday, he noted.
Speaking in broad terms, he said he favors “partnership forms” of management.
“You can’t rely primarily on one person to run a company,” he said. “It’s too much. I’ll have an appropriate level of involvement and Kerry and Sherry will run their divisions.”