Sumner Redstone’s Battles & Billion Dollar Deals

Note: the following article is based on extensive research that I undertook prior to the recording of our episode on Sumner Redstone (July 2023). The following links are well worth looking at and are the ones that we reference at the start of the episode. All other sources are linked at the bottom of the article and we are grateful to all of our sources.

Excellent article by Bryan Burrough from 1994 where he writes about the Paramount deal : https://www.vanityfair.com/magazine/1994/02/paramount199402

Great article by Bryan Burrough where he interviews Redstone in 2016: https://www.vanityfair.com/news/2006/12/redstone200612

Great article from WSJ on Shari Redstone's ride: https://www.wsj.com/articles/shari-redstones-path-to-power-1529659921

The following Youtube clips are well worth a look”

Short clip, Redstone on Murdoch: https://www.youtube.com/watch?v=K9tWdj7WeYo

Short clip, Redstone on the Paramount deal:

https://www.youtube.com/watch?v=GVW_2HMuhuw

Short clip, Redstone on his philosophy for success:

https://www.youtube.com/watch?v=FVETGNnbyW0

Short clip, Redstone on getting his start:

https://www.youtube.com/watch?v=-mnqyBGTLQA

Short clip, Redstone on the hotel fire:

https://www.youtube.com/watch?v=ZunBI9O3ZsU

Hollywood producer Rober Evans talks about his friendship with Redstone:

https://www.youtube.com/watch?v=uzzGKBZSG7w

Sumner Redstone’s story is one of ambition, dominance, and an unyielding pursuit of control. Rising from the modest beginnings of his family’s drive-in theatre business, Redstone built a media empire that reshaped the entertainment industry. His journey is marked by aggressive acquisitions, bold strategies, and a relentless drive that mirrored the very essence of American corporate ambition. As we delve into the life and career of Sumner Redstone, we will explore the complexities and controversies that defined him, tracing his ascent to power, the pivotal deals that cemented his legacy, and the personal and professional turmoil that ultimately led to a dramatic and public downfall.

One of the things I took from the story were the many similarities between Redstone and Rupert Murdoch (although it has to be pointed out that Murdoch’s overall impact on business and politics is far greater).

Both started in small regional media businesses with their fathers, grew those businesses into vast empires, and maintained unusual controlling voting powers, granting them immense control. Their personal lives were equally chaotic, marked by womanising that seemed to increase with age, portraying them as old men trying to prove their virility and power. Both held onto power longer than they should have, causing intense public speculation about their succession plans. Notably, both were inspirations for Jesse Armstrong's show "Succession." While Armstrong has stated his characters were inspired by several business families, he acknowledged Redstone and Murdoch's reluctance to plan or name a successor and their immense deal-making appetite as inspirations.

Redstone was known for his intelligence, drive, litigious nature, and controlling personality, but he was not a kind man. Interviews reveal him talking about the importance of character, yet he treated those close to him poorly. He publicly called his daughter a “c***”, tried to date his grandson's girlfriend, and had numerous affairs, humiliating his wife. He fell out with many people, including his brother and son, with whom he had no contact after 2003. He was known for shouting at waiters and service staff, and as he aged, he communicated through an iPad with 3 pre-programmed replies: "yes," "no," and "fuck you." A Hollywood mogul summed up Redstone's character: "He has no sense of other people. It's all about him, and it always has been. He has a tremendous ego. But he has no grace. No charm. Really, he's not loyal to anyone but himself."

Despite his flawed character, Redstone's business career is compelling. Born in Boston in 1923, his father, Mickey Rothstein, built a small chain of nightclubs and drive-in cinemas, reportedly funded by gangster Harry “Doc” Sagansky. Mickey changed their surname to Redstone to avoid associations with gangster Arnold Rothstein and to escape Boston's rampant anti-Semitism. Young Sumner was pushed hard by his mother to succeed, topping his class at Boston's most prestigious school and later attending Harvard to study law. He interrupted his studies to serve as a Japanese code breaker in the army during WWII, then returned to complete his degree and worked in government and private practice.

By 1954, Redstone grew bored with law and joined his father's business, North East Theatre Corporation, later renamed National Amusements. The company, split evenly between Sumner and his brother Eddie, saw Sumner rise as the public face while Eddie managed the administrative side. This led to tension, with Eddie feeling undervalued and accusing Sumner of always wanting full control. Their conflict resulted in Eddie suing for "mismanagement" and "wrongdoing," eventually settling for $5 million in 1972 and leaving the business to go onto a successful career in banking. Sumner claimed they reconciled later in life.

His legal background proved advantageous. At that time, drive-thrus were last to receive new releases, often weeks or months after indoor theaters. Redstone took legal action to ensure simultaneous releases for all cinemas and won. He also challenged the practice of blind bidding for movies, where theater owners bid without early access or knowledge of other bids, and he won this case too.

He understood early on that drive-thrus were not the future of cinema. Their seasonal nature and poor treatment by studios pushed him to transition into indoor cinemas. When he applied for a $10 million loan, the bank, impressed by his vision for the cinema business, offered a $50 million line of credit instead. While much of this story comes from Redstone himself, his rapid growth of his father's business is undeniable.

Redstone had a very clear strategy; he ensured that he owned the land for his cinemas, avoiding the rental model common at the time. He preferred investing in a hard asset over assuming rental costs, which he saw as gambling in the motion picture business. With the $50 million loan, Redstone expanded into indoor screens, trademarking the term "multiplex."

While expanding his cinema business, Redstone realised that the studios creating content held the real power. He understood that high-quality content was the driving force in the media business, and he maintained that he coined the phrase "Content is King" (although J.W. Click and Russell N. Baird first used the term in their 1974 book Magazine Editing and Production).

Redstone saw cinemas as a tight-margin, non-growth business. While he grew the number of cinemas, the number of moviegoers remained constant for 30 years. Though not yet positioned to acquire a studio, he invested in them. As a movie enthusiast, he recognized that a good film could significantly impact a studio's stock. This simple yet effective strategy led him to invest in studios after seeing promising films.

For instance, in 1977, after watching Star Wars, Redstone bought 25,000 shares of 20th Century Fox, eventually holding a 5% stake. When the studio was eventually sold to Rupert Murdoch, earning Redstone over $20 million, an 800% ROI. He also acquired a 9.7% stake in Columbia Pictures, earning $25 million when Coca-Cola bought it in 1982.

Through the 1960s and 70s, Redstone built National Amusements into one of the largest cinema chains in the U.S., invested in movie studios, and amassed significant wealth. Then, in March 1979, a pivotal moment occurred in Redstone's life.

While staying at the Copley Plaza Hotel in Boston, he received a call late at night informing him of a fire on his floor. Instinctively, he opened his bedroom door, causing flames to shoot into the room. Trapped three floors up and unable to jump, Redstone climbed out the window, hanging onto the windowsill for 10 minutes until firefighters rescued him, all while flames burned him.

At 55, Redstone suffered third-degree burns on 45% of his body, with his right hand almost completely burnt off. He underwent 60 hours of operations over several months. Remarkably, he resumed playing tennis, his favoured sport, taping the racket to his damaged hand for the first year. This tenacity and resilience defined much of Redstone's approach to business and life.

Two important aspects of the fire at the Copley Plaza Hotel in 1979 merit attention. First, Redstone's mistress was in the bedroom with him. Despite this being a well-known fact, Redstone never mentions it in interviews or his autobiography. This omission highlights the control he wielded over his public narrative, as interviewers never questioned him about his mistress when discussing the fire. Second, this incident underscores Redstone's philandering, which significantly impacted both his business and personal life.

Redstone always maintained that the fire did not change him; it simply reinforced his strong will to live and succeed. By the mid-1980s, he had built National Amusements into one of the largest cinema operators in the U.S., with over 300 cinemas and a personal net worth of $300 million. Redstone made his first major move outside of National Amusements in 1987, when he was 63 years old. Recognizing the burgeoning value of cable television, he set his sights on Viacom.

Viacom, initially founded by CBS and spun off as a separate entity in 1971, began as a distributor of popular CBS programs for syndication. This arrangement was due to Federal Communications Commission regulations prohibiting networks like CBS from syndicating their own TV shows, a law that has since been revoked. By 1987, Viacom owned syndication rights to classic shows like Matlock, The Cosby Show, I Love Lucy, and more.

The value of these syndication rights was immense. In 2012, I Love Lucy was still generating $20 million annually for Viacom/CBS, fifty years after it went off the air. The Cosby Show generated over $1.5 billion in syndication revenue over twenty years, averaging $75 million per year, excluding the $1 billion in ad revenue. Bill Cosby himself earned $300 million from his 20% stake in the syndication profits.

Viacom also boasted original programming on five TV stations, including the burgeoning MTV and Nickelodeon, which were on the cusp of explosive popularity. Redstone recognized their massive worldwide potential. He didn't see MTV as just a station for American youth but as a generational platform with global appeal.

Viacom's assets also included a handful of radio stations and one of the largest cable networks in the U.S. Redstone's appreciation for content led him to see the immense value in Viacom's portfolio, particularly MTV and Nickelodeon.

Acquiring Viacom was not straightforward. In 1986, Carl Icahn, a notorious corporate raider at that time, had built a 17% stake in Viacom, sparking fear among its management. Icahn was known for greenmailing—buying significant stakes in companies and then profiting by threatening to break them up unless paid a premium for his shares. Viacom paid Icahn a $21 million premium to leave, but this episode made management realise they were vulnerable to takeover.

Viacom's management decided to take the company private in a $2.7 billion bid. Redstone, who had built a 9% stake in Viacom, saw greater value in its assets and launched his own takeover bid. He acquired another 9% from Coniston Partners, an early investor in Viacom, careful not to exceed the 20% threshold that would trigger a poison pill defence orchestrated by renowned corporate lawyer Marty Lipton.

The 70s and 80s were a remarkable era for business activity, marked by a surge of takeovers and the rise of corporate raiders like Carl Icahn, Nelson Peltz, T. Boone Pickens, Kirk Kerkorian, and Sir James Goldsmith. These figures, who paved the way for modern private equity, were notorious for their leveraged buyouts, where they used vast amounts of borrowed money to acquire companies, often breaking them up and selling off the pieces for substantial profits. This aggressive approach earned them fear and disdain from corporations.

Central to the defence against these raiders was the poison pill, a tactic devised by Marty Lipton. This strategy empowers company boards to prevent hostile takeovers by diluting the value of shares held by the acquirer, effectively giving control back to the board. In Viacom's case, the poison pill would activate if any investor acquired more than 20% of the company's shares, allowing other shareholders to purchase additional shares at a discount, thereby diluting the raider's stake.

Sumner Redstone, however, was not a corporate raider. His interest in Viacom was not to strip it for assets but to build on its potential. Redstone, a firm believer in the mantra "Content is King," saw immense value in Viacom's programming and TV channels, particularly MTV and Nickelodeon. He strategically built his stake to 18%, enough to be taken seriously by Viacom's board, and then proposed an offer higher than the $2.7 billion management buyout (MBO) bid.

As Redstone's interest in Viacom became public, the share price rose, undermining the management's $2.7 billion bid. Redstone argued that this bid undervalued the company, prompting the management to increase their offer to $2.9 billion. Redstone countered with a $3.2 billion bid. During the bidding war, he secretly met with MTV's management, who shared his vision for global expansion, further solidifying his belief in Viacom's potential.

A supposedly independent committee was established by Viacom's board to evaluate the bids. Redstone suspected bias in favour of the MBO, as the committee kept entertaining slightly lower bids from management, which they could justify accepting if deemed in the company's long-term interests. Eventually, Redstone submitted a $3.4 billion bid and a letter outlining his concerns about the committee's impartiality. He also phoned the head of the committee and threatened legal action if the best offer was not accepted. This threat, backed by Redstone's formidable reputation as a litigator, swayed the board to accept his $3.4 billion offer.

Redstone, known for his tough demeanour, was relatively hands-off in operational matters. His MO was to find the best person for the role, compensate them well, and grant them significant creative freedom as long as they performed and increased the share price. His obsession with the share price was evident; he constantly monitored financial channels and even equipped his Lincoln Town Car with a DirecTV satellite dish to watch CNBC on the go.

This approach allowed Redstone to transform Viacom into a media powerhouse, demonstrating his acumen in recognizing and nurturing the value of content in the media industry. His strategic foresight and ability to navigate complex corporate battles set him apart from the typical corporate raider.

After acquiring Viacom, Sumner Redstone faced a significant amount of debt. However, his timing proved impeccable. In 1987, Congress deregulated cable television, providing a financial boon for Redstone. He sold off Viacom's non-essential cable divisions at high prices, leveraging these sales to reduce debt and stabilise the company's finances.

Redstone then empowered MTV and Nickelodeon's management to restructure and expand internationally. This strategy paid off rapidly. MTV became a global powerhouse, broadcasting to Western Europe, Japan, Australia, and large parts of Latin America. By 1989, MTV Networks was earning 15% of all U.S. cable advertising dollars. An advertising executive of the time noted, "If you want to target the youth demographic, you have to advertise on MTV."

Nickelodeon also thrived, becoming a world leader in children's television. By reaching 90 million TV households in 70 countries and 68 million households in the U.S., it dominated the children's TV market.

Viacom's success wasn't limited to MTV and Nickelodeon. It held a 50% stake in Comedy Central, which nurtured talents like Jon Stewart and Bill Maher and later became the birthplace of "South Park." Redstones network produced original, lucrative programming like "Rugrats" and "The Real World," while syndication from hits like "The Cosby Show" generated significant revenue.

With strong management and a robust share price, Redstone turned his attention to completing his ultimate vision: owning a Hollywood studio.

By the early 90s, Redstone, now in his seventies, was as ambitious as ever. Paramount Studios, under the parent company Paramount Communications, had suffered a series of box office flops, leading to a decline in share price. Martin Davis, CEO of Paramount Communications, knew the company was vulnerable to a hostile takeover. Among the potential suitors, Davis suspected, was Barry Diller, another media titan of the era.

Barry Diller's business acumen was well known. His company, IAC, owned Tinder, The Daily Beast, Expedia, and Vimeo. Diller, along with Redstone, Martin Davis, and John Malone, were the business moguls of their time, akin to today's Elon Musk, Mark Zuckerberg, and Jack Dorsey. Rupert Murdoch, another media giant, was a figure they all respected and watched closely. Redstone, Disney CEO Michael Eisner, and Time Warner CEO Gerald Levin all admired and feared Murdoch, with John Malone stating that global media integration was an effort to catch up with Murdoch. Ted Turner, founder of CNN, had a more adversarial view, comparing Murdoch to Adolf Hitler.

The Paramount deal was particularly complex due to Diller's history with the studio. He had been head of Paramount Studios from 1974 to 1984, working under Martin Davis, an autocratic and tough boss. Davis was known for his harsh demeanour, described by a former aide as "a man with a tiny, cruel heart." Under Davis's leadership, he alienated much of Hollywood, including top executives who had previously worked for but then left Paramount like Diller, Michael Eisner, and Jeffrey Katzenberg. David Geffen famously criticized Davis, stating, "He is a man who got rid of the three most talented people in the world he inhabits." This loss of talent was seen as a monumental blunder, with Diller, Eisner, and Katzenberg going on to create billions of dollars in value for other companies.

After leaving Paramount, Diller became Chairman and CEO of 20th Century Fox, launching the Fox network and greenlighting iconic shows such as "Married... with Children" and "The Simpsons." In 1992, Diller left Fox and purchased QVC, the home shopping network, with backing from John Malone, who owned TCI, the largest cable company in the U.S., and later Liberty Media.

As Redstone maneuvered to acquire Paramount, he faced the challenge of competing with Diller who had John Malone in his corner.

Malone, known as the "Darth Vader of cable" for his ruthless business tactics, was a formidable player in the Paramount bid. Not only did he back Barry Diller's bid, but he also made his own bid for the studio. However, Sumner Redstone identified a key vulnerability in Diller's position: Malone's growing dominance in the cable industry.

Redstone took his concerns to the U.S. Senate anti-trust committee, arguing that Malone's expanding influence posed a threat to competition. His persuasive arguments led to Malone selling his 22% stake in QVC, temporarily leaving Diller without his major financial backer. Nonetheless, Diller quickly found new backers and resorted to a tender offer, a strategy where he appealed directly to Paramount shareholders to sell him their shares at a premium, bypassing the need for board approval. He offered $80 per share, $4 above the market price, and set a 20-day deadline.

This move sparked a bidding war. Redstone countered with his own tender offer, escalating the financial stakes. The intense competition placed enormous pressure on Redstone, but, in a remarkable manoeuvre, Redstone merged Viacom with Blockbuster in a stock-swap merger valued at $8.4 billion. The merger provided Redstone with the much-needed cash infusion from Blockbuster, then a cash-rich business. He used this to increase his offer to $107 per share, making the deal worth over $10 billion. By February 1994, Redstone secured the majority of shareholder approval.

Although the bidding war forced Redstone to pay over $2 billion more than initially planned, he quickly recouped significant amounts by selling off non-core assets. These included the Madison Square Garden properties, which fetched over $1 billion, and Simon & Schuster's educational publishing units sold to Pearson PLC for $4.6 billion. Despite these high sale prices, some analysts, including a 2002 academic paper, argued that Redstone still overpaid by about $2 billion.

Following the acquisition, Redstone implemented his proven strategy: he placed talented management in charge and granted them creative freedom. He also reduced the number of movies Paramount produced annually from 25 to 18, focusing on higher quality. This strategy yielded quick results, with Paramount releasing major hits such as "Forrest Gump," "Saving Private Ryan," "Braveheart," and "Titanic," the latter co-financed with Murdoch's 20th Century Fox.

The acquisition allowed Redstone to create a vertically integrated media empire. Paramount's extensive library of older movies could now be broadcast on Viacom's TV networks, while new releases were shown in Redstone's cinemas and later distributed through Blockbuster and Viacom's Showtime network.

However, Blockbuster faced significant challenges, impacting Viacom's share price. Obsessed with the share price, Redstone took direct action, firing the CEO and appointing a new one. Together, they revamped the movie rental business model. Previously, video stores paid $60-$70 per new movie video cassette, limiting the number of new releases available for rental. This led to customer dissatisfaction and declining business.

Redstone's intervention involved negotiating revenue-sharing deals with Hollywood studios. Under the new model, Blockbuster would pay a lower upfront cost per cassette and share rental revenues with the studios. This allowed Blockbuster to stock more new releases, improving customer satisfaction and boosting business.

Redstone's strategic acumen, relentless drive, and willingness to take bold risks not only transformed and redefined the media landscape. His vision of "Content is King" and his ability to leverage assets across various platforms created a powerful, integrated media empire that continues to influence the industry today.

Redstones next transformational move was in 1999 when he bought CBS for $37 billion.

Unlike his Viacom and Paramount deals, this one went ahead smoothly, there was no bidding war, and at the time it was the largest ever media merger, and made the newly name ViacomCBS the second largest media company in the world after Time Warner with a market value of $72 billion. But it was eclipsed just a few months later by the mega merger of AOL and Time Warner- a deal that is widely seen as one of the worst ever in US corporate history- and this is another great story that we’ll cover at some stage

CBS CEO, Mel Karmazin was to be Redstones second in command and heir apparent when Redstone stepped down, because at this time Redstone was now 76.

However Karmazin’s and Redstones relationship deteriorated quickly, my own feeling is that Redstone never intended to relinquish control, and after 4 years of working together, Karmazin left

Redstone’s grip on ViacomCBS — he controlled nearly 80% of the voting shares — allowed him to wave off pressure from investors to detail a specific plan following his death- he had previously named his daughter Shari as his heir, but as we see, things started to get messy- and it was all down to Redstones desperation to cling to power and to be seen to be in charge.

After the CBS deal Redstone should have retired, he was getting on and as we shall see, while his stubbornness remained intact, most of the other attributes that had served him well up to now, were diminishing- if he had retired after the CBS deal his legacy would have remained intact.

What happened instead is Redstone’s personal and business life became entangled and very public, turning Redstone’s business and family into a soap opera

And while I’ve read many who liked to portray it as a drama of Shakespearean quality, I see these last 20 years of his life as a grubby footnote, an embarrassing end that Redstone could and should have avoided.

So let's dig into it.

The soap opera kicked off in 1999 when Redstones wife of 52 years, Phyllis, filed for divorce- she was fed up with his womanising and the public humiliation that came with it.

While I could never find out exactly how much Phyllis got out of the divorce, as part of the settlement Redstone agreed that when he died all of his stock would be left to his grandchildren.

Redstone owned 66% of National Amusements, and his 2 children, son Brent and daughter Shari each owned 1 sixth.

In 2003 his son Brent was removed from the board of Viacom- he felt it was a vindictive move by Sumner because Brent didn’t sign over his voting rights to Sumner as part of an agreement Sumner was thrashing out with his ex wife during the divorce settlement.

In 2006 Brent sued his father in an attempt to break up the empire - he felt that Sumner was mismanaging the company, and as we shall see, he was right.

Brent’s stake at that time was worth $1.3 billion but it was tied up in a trust that he didn’t have access to and didn’t derive any income from

Now he was pulling in a salary of about $1 million dollars a year form National Amusements, so he was doing OK.

He eventually settled his case with redstone by selling his stake for $240 million and never spoke to him again.

Around this time Redstone got married for the second time to a teacher 40 years his junior.

Getting back to the business, in 2005 Redstone split Viacom and CBS into separate entities, because he believed that CBS was dragging down the share price - he put Les Moonves in as CEO of CBS and Tom Freston as CEO of Viacom, while Redstone remained chairman of both

Most people thought, and rightly so, that Redstone would take a back seat and quietly fade into into retirement with his new wife.

But Redstones need for control and his ego got the better of him

Less than a year after he supposedly stepped into the background, Redstone made 2 very public decisions that he believed would let Hollywood know who was in charge, but that in reality only underlined the fact that he was getting old and making poor decisions.

First, in August 2006 he declared that Paramount would not be renewing it’s long term contract with Tom Cruise, he was effectively firing Cruise- Redstone claims that it was because of Cruise’s behaviour- for those of you who don’t remember, there was very memorable TV moment in 2006 when Cruise jumped up and down on Oprah Winfrey's couch declaring his love for Katie Holmes- if you like cringe, it’s TV gold.

Then a month later Redstone sacked Tom Freston from Viacom after Freston had been in charge for just 8 months, despite the fact that even Redstone himself had said at the time that he split CBS & Viacom that it would take at least 1 year before the dust settled on the split.

Freston got an $80 million dollar settlement.

Redstone’s public excuse for firing the guy who built MTV was that he was unhappy with the Viacom share price and he was also frustrated that Freston hadn’t managed to buy Myspace, the hot internet site at that time.

And what enraged Redstone even more was the fact that Rupert Murdoch bought it for $580 million.

Now I have very little knowledge or memory of Myspace other than it was one of the very first social media sites, it shone very brightly for the briefest moment and then Facebook stole it’s thunder - Murdoch eventually sold it in 2011 for just $35 million (to a consortium that included Justin Timberlake).

Sidenote: I was even more surprised to find out that Myspace is actually still going, and Timberlakes consortium managed to sell it to Time Inc in 2016 for $87 million.

While MySpace looks like a bad deal for Murdoch (and in many ways it was), it should be noted that straight after buying Myspace Murdoch signed a $900 million deal with Google for the right for Google to sell advertising on Myspace for 3 years.

Now I tried to get to the bottom of that deal and it appears that Google didn’t end up paying the full $900 million.

Freston was well regarded on Wall Street and in Hollywood while Cruise was still a huge box office draw- so these 2 moves were clearly seen as Redstone’s attempt to prove that he was still in charge. Of course in reality the moves had the opposite effect as they highlighted the fact that Redstone was making poor decisions in a desperate attempt to appear in charge and relevant.

He then put his trusted sidekick Phillipe Duaman in charge of Viacom. Duaman had been with Redstone for many years, so he was loyal to him.

Redstones 2 children, Brent and Shari, did not approve of Duaman- they saw him as an obsequious yes man and his elevation to the top of Viacom was one of the reasons why Brent felt that Sumner was starting to lose his touch and mismanage the company.

Shari also disagreed with Duaman’s appointment and started to disagree with Redstone over other issues.

Redstone had invested heavily in a gaming company called Midway Games, the creator of Mortal Kombat. Shari rightly assessed that it was a bad investment but Redstone ignored her warnings and continued to invest. While I couldn’t find an exact amount invested, it ran to the hundreds of millions before Redstone eventually sold his stake for a paltry $100K.

Shari also started making noise about the makeup of the Viacom board- she felt that it was packed with Sumner loyalists who never questioned him and there wasn’t any diversity.

Redstone didn’t like being challenged and so in 2007 he sent an open letter to Forbes.com, disparaging Shari as having made “little or no contribution” to the media dynasty he built, and it’s also alleged that he called her a “c—” in front of company executives.

As a result, the whole succession question was thrown into doubt and Redstone seemed to relish the chaos- despite the fact that his actions were having a seriously negative impact on the business.

Now it should be noted that CBS continued to thrive - it was being led by Les Moonves who he was a very capable operator, and while Viacom under Duaman initially did well reaching their highest price ever in 2014, by 2015 its share price was lagging.

Viacom, like all traditional media was being hammered by the success of Netflix, and the ever growing video-sharing channels like youtube and Snapchat.

In truth, many media companies didn’t see the initial promise of Web-based content, allowing tech players such as Amazon and Netflix to plant deep flags in the new territory and the ramifications of these missed opportunities are still being felt by media conglomerates.

Critics loved to point out that not a single one of Viacom’s biggest hits — i.e. Beavis and Butthead, Dora the Explorer, SpongeBob SquarePants, The Daily Show and South Park — were developed since Dauman took the reins in 2006. And yet as a sign of Redstones diminishing judgement, he kept Duaman in situ.

While all of this was going on, Redstones personal life continued to play out in the media- he divorced his second wife after 5 years and had a string of girlfriends half his age, 2 of whom in particular managed to gain strong control over Redstones life. By now, Redstone faculties were very much diminished- he couldn’t talk and used an iPad to communicate.

These 2 women wrangled as much money as they could out of him -in 1 example on a single day Redstone wired $90 million to the women's accounts- 45 million each. In total it’s estimated that the 2 women got about $150 million off of Redstone before Shari eventually managed to convince her father that they were not looking out for his best interests.

They were booted out of Redstones life, and in 2016 Phillipe Duaman was fired he tried to sell Paramount Studios in a last ditch bid to prop up Viacom’s share price. (Redstone would never agree to sell Paramount- it was the crown jewel in his empire).

Duaman got a $72 million dollar settlement.

Ousting the 2 women and Duaman was not easy- both cases involved a lot of litigation, but the end result was that Shari Redstone was back in her fathers life and also back in control of Viacom.

There were more twists and turns to the Viacom story in recent years but none involving Sumner Redstone- in 2016 at the age of 92 he resigned as executive chairman of Viacom and relinquished all control to his daughter.

He passed away in August 2020 at the age of 97- the empire that he had built was much smaller now- at the time of the Viacom/CBS deal, the company was worth $72 billion- today (2023) that company has been rebranded as Paramount Global and is worth $10 billion- it’s diminished size can be attributed to the emergence of streaming services and Viacom’s inability to pivot and meet the challenge. They have since done so with the launch of the Paramount Plus: By June 2023, Paramount Plus had just over 60 million subscribers compared to Disney plus 158 million, Netflix- 230 million, Amazon Prime- 200 million, Apple TV- 42 million .

In my opinion the blame lies squarely at the feet of Sumner Redstone, his reluctance to give up power, his deliberate machinations to ensure that there was no clear succession plan and that he remained front and centre had a negative impact on the business.

His treatment of those nearest and supposedly dearest to him was even worse. It’s hard to feel much sympathy or empathy for such a man.

Yet, from a business point of view, his vision in seeing the power of cable, his dedication to letting the creatives put out some fantastic content, and his insight that media properties were franchises that you could take all over the world can’t be overlooked.

On a purely business perspective, his big mistake was that he didn't know when to leave the stage.

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