Critics said that a cable network based on music videos was doomed, but Redstone disagreed, and rebuffed efforts from the company's bankers to unload the fledgling MTV. Instead, he expanded its reach, bringing it into Europe, Asia, Latin America and Russia.
Sumner Redstone, who built a media empire from his family’s drive-in movie chain, has died. He was 97.
ViacomCBS Inc., which he led for decades, remembered Redstone for his unparalleled passion to win, his endless intellectual curiosity, and his complete dedication to the company.
Redstone built the company through aggressive acquisitions, but many headlines with his name focused on severed ties with wives, actors and executives. In multiple interviews, he said he’d never die. His tight-fisted grip on the National Amusements theater chain, which controlled CBS Corp. and Viacom Inc. through voting stock, was passed to his daughter Shari Redstone, who battled top executives to re-merge the two entities that split in 2006.
Sumner Redstone’s battles with his own family were as dramatic as his corporate maneuvers. Son Brent Redstone once sued his father to break up his media empire then settled for a princely sum to give up his voting shares. Redstone, a lanky man with a thick Boston accent, was married and divorced twice first to Phyllis Gloria Raphael, mother of his children Shari and Brent then to schoolteachers Paula Fortunato, a woman 39 years his junior.
Under his watch, Viacom became one of the nation’s media titans, home to pay TV channels MTV and Comedy Central and movie studio Paramount Pictures. Redstone often told interviewers, content is king. And he was right. Despite sagging TV ratings at Viacom, his vast shareholdings in Viacom and CBS led Forbes magazine to estimate his net worth at $4.6 billion. Besides being ruthless, Redstone was known for being doggedly determined. In 1979, he survived a fire at Boston’s Copley Plaza Hotel by gripping a third-floor window ledge with his right arm still inside.
He suffered third-degree burns over half his body, his right wrist was nearly severed, and he was told he would never walk again. But he eventually recovered, and even was able to play tennis by strapping the racket to his wrist. I intend to live forever! he told Upstart Business Journal in 2009.
Born in 1923 in Boston, Redstone was the oldest son of Michael and Belle Rothstein, who changed the family name to Redstone. Redstone graduated first in his class from Boston Latin School in 1940 and completed his education at Harvard in less than three years. He was selected to work on an Army intelligence team during World War II that cracked Japan’s military codes.
After three years in the Army he went to Harvard Law School and became a partner at a Washington law firm. He gave it up to join his father’s drive-in movie business in 1954. Redstone grew it into a major chain of multi-screen movie houses called National Amusements Inc.
The privately held company became the base for his media empire, and the source of all his family’s feuds. He made a killing by trading in the stocks of Hollywood studios and in 1987 the year he turned 64 bought Viacom in a hostile takeover for $3.4 billion, most of it borrowed, ousting founder Ralph Baruch as chairman.
Critics said that a cable network based on music videos was doomed, but Redstone disagreed, and rebuffed efforts from the company’s bankers to unload the fledgling MTV. Instead, he expanded its reach, bringing it into Europe, Asia, Latin America and Russia.
Redstone next went after Paramount Pictures, a four-year process that ended with a friendly offer from Viacom for $10 billion in 1993. He scooped up the Blockbuster video rental chain for its then-healthy cash flow, not knowing then that videotape rentals would collapse.
Viacom then swallowed CBS Corp. for $34.5 billion in September 1999, then the largest media merger until the AOL-Time Warner union came months later. The deal brought Redstone together with CBS chief Mel Karmazin, another tough-talking executive from humble origins.
By June 2004, Karmazin was out, later to become head of Sirius Satellite Radio Inc. CBS and Viacom were split into two public companies both under his control in 2006. Another victim of Redstone’s rise: Tom Cruise, whose couch-jumping on The Oprah Winfrey Show and embrace of Scientology led Redstone to cut short a deal with Cruise and his production company.
We don’t think that someone who effectuates creative suicide and costs the company revenue should be on the lot, he told The Wall Street Journal in 2006. The two later patched things up ahead of the making of Mission Impossible: Ghost Protocol. By 2010, Redstone’s hand in the business became unwelcome.
He shepherded onto TV a show featuring a scantily-clad girl group, the Electric Barbarellas, over protests from within. The day it aired, MTV Networks CEO Judy McGrath resigned. Then he was scandalized further after reporter Peter Lauria made public a voicemail in which Redstone offered to bribe him to reveal the leaker of the story about his meddling.
Redstone clashed with his two children. He bought son Brent’s stake in National Amusements to settle a lawsuit in 2007. And after favoring daughter Shari as his successor, they hit a cold patch.
In May 2015, he released a statement saying that after he dies, his ownership stakes in CBS and Viacom, through National Amusements, would be managed by a seven-person trust. The trust listed as trustees Viacom CEO Philippe Dauman, daughter Shari, her son Tyler Korff, and four lawyers.