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CBS promotes Karmazin
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April 7, 1998: 5:43 p.m. ET
Names ex-Infinity chief as president, COO; Moonves to head TV business
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NEW YORK (CNNfn) - CBS Corp. promoted Mel Karmazin on Friday to the new posts of president and chief operating officer, positioning the one-time radio executive as a possible successor to Chairman and Chief Executive Officer Michael Jordan.
Karmazin, who joined CBS in 1996 when the network bought his Infinity Broadcasting business, will oversee an expanded empire in his new role, and will "be involved in all aspects" of the network's business, the company said in a statement. He will report directly to Jordan.
Leslie Moonves, currently president of CBS Television, will report to Karmazin in an expanded role as president and chief executive of the company's television operations. Moonves arrived in 1995 as president of CBS's entertainment division.
Industry insiders see the moves as an attempt to streamline CBS's management structure.
"It's an orderly transition, I think," said Ed Atorino, analyst at Wasserstein Perella Securities. "Jordan is taking a less visible role and the broadcast guys are assuming positions of power."
Currently, Karmazin serves as president of the CBS Station Group, which includes the 14 CBS owned-and-operated TV stations, as well as the company's radio business.
He took over the reins after Peter Lund resigned during a messy transition in May 1997.
As a result of the Infinity transaction, Karmazin is also CBS's largest individual shareholder, owning about 10 million shares of the media giant's stock.
"Karmazin is clearly the key guy," Atorino said.
Coming from a radio background, Karmazin is still building his reputation in the TV industry as an aggressive, hands-on manager. But many analysts believe he has already achieved a great number of accomplishments.
Under what insiders call a proactive management style, Karmazin helped CBS restructure sales operations, renewing a commitment to top salespeople.
For instance, Karmazin reorganized commission structures, helping to motivate the sales staff.
"He's never been afraid to pay and keep a top producer," said Philip Olsen, analyst at UBS Securities.
Olsen also said Karmazin "dramatically increased the number of sales reps out there."
And with a range of CBS assets at his disposal, Karmazin also increased the number of products -- local television, radio or even outdoor advertising - that sales reps could offer.
As for Moonves, some analysts believe Tuesday's management changes will leave the executive with an increased role among the investment community. But some think Moonves will have a difficult time escaping Karmazin's shadow.
"Mel clearly has Wall Street's ear and attention. Whatever goes on, I think they want to hear it from Mel," Olsen said.
Industry watchers credit Moonves with reviving CBS's TV fortunes, winning the company a firm second place behind General Electric Co.'s NBC broadcasting unit among ratings for the four major TV networks.
Under Moonves' supervision, CBS successfully started shows such as "Touched by an Angel," and brought in high-profile talent like Bill Cosby and Tom Selleck.
Meanwhile, CBS also announced Tuesday that CBS News President Andrew Heyward will now report to Moonves, who will also oversee CBS Sports, CBS Enterprises, as well as syndication. Sports and news previously reported directly to Jordan.
-- by staff writer Robert Liu
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