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Freston's wild career takes another surprise turn
2006-09-05
Tom Freston's unusual career path took another unexpected turn on Tuesday, when he was ousted as chief executive of Viacom Inc. (NYSE:VIAB). Freston, 60, with a spiky hairstyle more suited to rock concerts than corporate boardrooms, served as CEO for nine months, a period in which the media company's stock price fell about 10 percent and its strategy came under fire. Even so, Freston's forced departure came as a surprise to many given his relationship with Viacom Chairman Sumner Redstone and his reputation as a sharp and savvy executive. As MTV's top executive, Freston built a worldwide brand by keeping pace with quick shifts in pop culture and expanding overseas. He also became known as one hip media executive, living in an apartment once owned by Andy Warhol and running with rock stars like Dave Matthews. But Wall Street's view was that Viacom lacked an aggressive internet strategy under Freston letting rivals Walt Disney Co. (NYSE:DIS), News Corp. (NYSE:NWS) and Time Warner Inc. (NYSE:TWX) pull ahead. "In terms of getting to the Internet, you would have to rank this thing fourth of the big four media companies," said Larry Haverty, a portfolio manager at Gamco Investors, which owned 4.7 million shares of Viacom Class A shares and 102,000 Class B shares as of June 30, 2006. While Freston said he would help with the transition of his job to Philippe Dauman, he made no mention of his own plans in the Viacom statement announcing his resignation. "I WANT MY MTV" Raised in Connecticut, Freston earned his undergraduate degree from St. Michael's College and an MBA from New York University. Later, he landed a job in advertising. But he lasted only a couple of years, and then took off for Europe, the Middle East and India, where he started his own clothing and textiles business. By 1980, Freston was back in New York and answered a newspaper ad for Amex Satellite Entertainment Co., the predecessor to MTV. A year later he helped launch the cable music channel, heading up marketing and overseeing the "I want my MTV" campaign. "Look at your average 16 year old and they're a grizzled veteran of the media world," Freston said at the Reuters Technology, Media and Telecommunications Summit in March. "By the time they're 16, they've seen it all and they can smell it better than the 16-year-old 10 years ago." As CEO of MTV, a position he won in 1987, Freston helped move the business beyond its roots in music videos, and built a powerhouse network of channels with original programming, such as "SpongeBob SquarePants" on Nickelodeon or Comedy Central's "South Park" and "The Daily Show with Jon Stewart." Freston also created film properties from MTV brands, like "The Rugrats," "Jimmy Neutron," and "Snow Day." Viacom decided to split its business in two last year, putting Freston CEO in charge of cable and movie studio assets and Leslie Moonves in charge of CBS radio and television. At the time, many believed Freston had the better job, saying his company would offer sexier businesses, faster growth and better prospects for the stock. But Viacom's widely held Class B shares have failed to take off. "Just wait," Freston predicted at the Reuters summit in March. "I feel very confident that we are going to be able to deliver on the expectations we set out." On Tuesday, his time had run out. (Additional reporting by Kenneth Li)
Freston's wild career takes another surprise turn (2006-09-05)Freston out, Dauman in as Viacom's CEO (2006-09-05)Viacom profit up 27 pct on cable ad sales (2006-08-09)
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