This article was updated at 9:20 p.m.
Sandy Grushow is ankling his post as Fox Television Entertainment Group chairman, ending the longest era of exec stability in the network’s 17-year history.
Under an exit clause contained in his most recent contract, Grushow will set up his own 20th Century Fox TV-based pod, Phase Two Prods.
His position overseeing both the network and the studio will not be immediately filled, giving a boost to Fox Entertainment prexy Gail Berman and 20th toppers Gary Newman and Dana Walden.
Grushow cited his unwillingness to reup for another four years in the same job. Indeed, the exec apparently realized there was no way to grab any more substantial power within family-run News Corp. and decided to leave now rather than remain stagnant for another half-decade.
Nonetheless, the decision — announced Monday morning as Hollywood was stumbling back into town after a two-week holiday hiatus — caught most of the biz off-guard.
Despite a troubled fall season, the net has launched two hits in the last six months (“The OC,” “The Simple Life”) and is still considered to be in the thick of the Nielsen battle. On the studio side, 20th — once an also-ran — has generated more than $1.5 billion in profit since Grushow took over in 1996.
What’s more, Fox seemed to have broken its pattern of frequently changing entertainment division toppers.
Until Monday, Fox hadn’t seen a top-shelf shuffle in almost four years. Berman joined the network in May 2000; together, she and Grushow repped the longest-running entertainment administration since Fox’s founding.
Grushow, whose contract is worth $5 million annually and was due to expire this summer, has been mulling his future at the network for months. In mid-December, there were strong rumblings that Grushow might be exiting — speculation dismissed at the time as the usual Fox exec shuffle rumors.
Exec acknowledged his contract has been on his mind for a while but he said he didn’t finalize his departure plans until recently. He said he told Fox Group chairman-CEO Peter Chernin of his decision on Friday; a few top Fox execs were told Sunday night.
Freedom of choice
Grushow told Daily Variety he found himself having “the freedom to choose the path you want your professional career to take. I thought long and hard about spending another four years as an executive at Fox, but in the end, I chose to go down a different path.”
In a written statement, Chernin was effusive in his praise of Grushow, calling the exec “a close and valued colleague for almost 20 years (who) will be missed.”
“His contributions to the evolution of Fox are too numerous to list,” Chernin added. “I think he probably has had as long a tenure at the top of the fast-changing television industry as anyone in the business, and as much as I would have liked to continue to work shoulder to shoulder with Sandy as an executive, I certainly respect his decision and am looking forward to continuing our successful association.”
Chernin, however, was traveling Monday and did not make himself available to answer questions surrounding the announcement of Grushow’s departure.
Exec’s exit comes as News Corp. chairman Rupert Murdoch has been vocal in his displeasure with Fox’s performance this fall, a position shared by News Corp. prexy-chief operating officer Chernin.
In an interview with the New York Times last month, Murdoch said the net had “too high a failure on our new shows” and “the broadcast division stumbled badly” with “Joe Millionaire 2.”
Grushow, however, said he “couldn’t emphasize how much I appreciate all the support Rupert and Peter have shown me over the years.”
“Peter would have liked me to have stayed, and I elected to avail myself of this other opportunity,” Grushow said. “I felt no pressure whatsoever to make this decision. This was my choice, which I had the good fortune and freedom to make.”
Production deal, said to be worth eight figures over three years, will allow Grushow the chance to hire five or six staffers and develop shows for other nets.
Perhaps more importantly, deal allows Grushow the freedom to jump into another exec post should one that interests him become available.
While saying “it would be silly of me to ever close the door on any future opportunities,” Grushow said his focus will now shift full-time to producing. One goal: finding a way to reduce program costs.
“I experienced some real frustration in this position because no matter how hard I tried, I never felt I was able to create the sense of urgency necessary in the creative community (about low-cost shows),” he said. “I’m excited about the prospect of trying to push the process forward from this new position.”
Walden said Grushow will “fit in nicely (as a pod player) because he’s someone who believes in the Fox brand of doing things that are unconventional,” while Newman predicted his former boss has “a huge amount of pent-up enthusiasm to get closer to the product and will come out of the box running.”
Grushow first joined Fox Broadcasting in 1988 as senior VP of advertising and promotion. He was upped to exec veep of Fox Entertainment in 1991 and named president in 1992. But after acquiring NFL rights, News Corp. brass decided to change Fox’s programming strategy in 1994 — and Grushow was history.
After a stint at the short-lived telco venture Tele-TV, Grushow returned to the fold in 1997 as head of 20th Century Fox TV. After transforming that studio into the leading network TV producer, Grushow was given added oversight of Fox’s entertainment side in 1999.
Overseeing marketing and advertising early in the net’s existence, Grushow was an architect of Fox’s edgy, “bad boy” brand. He helped launch signature Fox series such as “The Simpsons,” “In Living Color” and “Beverly Hills, 90210.” As entertainment president, he scheduled hit series such as “The X-Files,” “Melrose Place” and “Mad TV.”
When News Corp. toppers realized the error of trying to broaden Fox’s image in the mid-’90s, Grushow was the company’s logical choice to return the network to its roots and help bring it back from the brink.
Returning to the network fold, Grushow maintained oversight of one of the top network production companies, which entered the TV season with 14 returning shows and nine new entries. At Fox, meanwhile, he oversaw the launch of skeins like “24,” “Bernie Mac,” “Boston Public” and “The OC.”
“I was shocked to hear the announcement today,” said “24” exec producer Joel Surnow. “I have only high praise for Sandy. He supported our show from the beginning and all the way through the first three seasons in every way — not just creatively, but financially.”
Under Grushow, the network also pulled off its first-ever sweeps win among adults 18-49, pulling off back-to-back victories in February and May 2003. Fox also finished the 2002-03 TV season ranked No. 2 among adults 18-49 by the closest measure in its history — just 0.2 of a ratings point behind NBC.
Endeavor partner Rick Rosen echoed the surprise heard around the industry regarding Grushow’s departure.
“Sandy is synonymous with the Fox network and Fox television, both from the production and network side,” Rosen said.
While Grushow is known to have a blunt management style, UTA TV co-topper Jay Sures said that’s one of the keys to his success.
“Love him or hate him, Sandy got the best out of so many execs, and that’s why the company has had so much success over the last five years,” he said.
No room to grow
In the end, several observers agreed that there wasn’t any more room for Grushow to grow at the company. He took the Fox Television Entertainment Group chairman job at the right time — in 1999, when companies were opening their pocketbooks wide to prevent top talent from being lured by the then-booming Internet economy.
“Corporations were making big deals with people I don’t think they woul
d make today,” said one insider.
But in 2004, it’s clear the top gigs at News Corp. are increasingly reserved for execs with “Murdoch” in their last name. And for an executive of Grushow’s stature, it may have been time to try something different.
Further complicating matters is the fact that Chernin, whose contract expires this year, has not yet negotiated a new deal and is facing some of the same News Corp. succession questions.