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VIACOM SHAREHOLDERS' SUIT OVER EXECUTIVE PAY TO BE TRIED Thursday, June 29 2006 
A
New
York
court
has
given
the
go-ahead
to
a
lawsuit
filed
by
Viacom
shareholders
who
claimed
that
the
company
was
doling
out
excessive
and
unwarranted
compensation
packages
to
Chairman
Sumner
Redstone
and
his
top
lieutenants,
Thomas
Freson
and
Les
Moonves,
even
while
the
company
was
losing
money.
The
lawsuit
noted
that
in
2004,
when
the
company
reported
a
net
loss
of
$17.4
billion,
Redstone
received
$21.5
million
and
options
valued
at
$34.4
million.
(more)CBS GOING TO THE MOVIES -- AND INVESTORS APPROVE Monday, June 26 2006 Wall Street has reacted enthusiastically to CBS Chairman Les Moonves announcement last week that the company may reenter the theatrical movie business after more than 20 years, financing and producing films in the $20-50-million range. CBS shares closed Friday at $26.50, up 4 percent over two days and close to its all-time high since last January's split from Viacom. The announcement triggered "buy" recommendations from several analysts, but some observed that the split was intended (more) |
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CBS Chairman Les Moonves touted his company's entry into the movie business Thursday, telling analysts that the broadcaster would be able to make films budgeted at $10-50 million "risk free." In a conference call to discuss CBS's quarterly earnings report, Moonves emphasized, "I'm talking about zero risk" and said that under his plan the films would be profitable "before a dollar is achieved in box office." He suggested that profitability could be guaranteed by DVD and foreign sales. Moonves indicated that one of the ways he intended to keep costs down was to employ its current resources. "We're not going to have a large studio overhead. We're going to do it in a very cautious manner." Moonves said that the movies are not being produced for the network "obviously," but that many will end up on cable. He noted that CBS's pay-TV channel Showtime has deals with three studios that end in 18 months and that its own movies will supplant some of the studios'. In any case, he said, he believes that Showtime will not have to "do the large output deals" that were required in the past, and that cutting them back will reduce the channel's expenses. He also said that Showtime plans to increase the number of scripted original series. Analysts said that Moonves's plans appeared to be aimed at diversifying the company so that it would not have to depend so heavily on advertising revenue, which has been hit by a slowing economy.
