Sumner Redstone, Viacom founder and old-fashioned media mogul, dies at 97
Many of the final years of Sumner Redstone’s life were spent tied up in fractious litigation over his multibillion-dollar estate, but in his prime he was a man who truly embodied the old-fashioned term “media mogul.” Through his ownership of both Viacom and CBS, Redstone controlled large swaths of the American media landscape, and he maintained that control with an iron grip, even to the detriment of his relationships with his own family.
Redstone died on Tuesday, at the age of 97, National Amusements Inc., the Redstone family’s private holding company, said in a statement issued today.
“Over the course of his distinguished life and career, Sumner played a critical role in shaping the landscape of the modern media and entertainment industry,” the statement read. “At National Amusements, he transformed a regional theater chain into a world leader in the motion picture exhibition industry. Sumner was also a keen investor who took stakes in a variety of companies, including Viacom Inc. and CBS Corporation—today merged as ViacomCBS—which he built into prominent, international, and industry-leading conglomerates in the media industry.”
Sumner Redstone was born Sumner Murray Rothstein on May 27, 1923, in Boston. His father, Michael, who owned a movie theater and a nightclub called the Latin Quarter in Boston, anglicized the family’s original Jewish name in 1940.
The Redstones’ theater company eventually became National Amusements, which in turn would become the cornerstone of Sumner Redstone’s media empire. Through it, Redstone and his family controlled CBS Corp. and Viacom, and through Viacom they controlled assets like BET Networks, Comedy Central, Nickelodeon, and the movie studio Paramount Pictures. According to Bloomberg, Redstone died with a net worth of $1.9 billion, a fortune closely controlled through National Amusements.
World War II veteran
Before he became a mogul, Redstone graduated from Harvard and served as a lieutenant in the U.S. Army, where he worked with a special team that decoded Japanese communications. After the war ended, he went to Georgetown University Law School, before transferring to Harvard Law School, where he graduated with a law degree in 1947.
After working for the U.S. Attorney General, Redstone joined his father’s company in 1954 and eventually became CEO in 1967. His father’s single theater had by that time become three drive-ins, and it continued to grow throughout the 1970s. When the drive-ins started to close down, the company still made money because it owned the land beneath them, which it sold to developers. National Amusements still has 32 theaters across the United States with over 400 screens.
In the 1970s, Redstone came to believe that while movie theaters might be slowly dying, content such as movies and television would always be valuable. The Viacom chairman is believed by some to have coined the phrase “Content is king,” and he also came up with the term “multiplexes” to describe theaters with more than one screen, which became popular in the 1980s.
Read these profiles of Sumner Redstone from the Fortune archive:
• Redstone’s Remarkable Ride to the Top (1999)
• The Disturbing Decline of Sumner Redstone (2016)
In pursuit of his vision of the future of media, Redstone started investing in movie studios like Columbia Pictures, 20th Century Fox, Warner Communications, and Paramount Pictures. He sold most of these holdings in the 1980s and made substantial returns, but kept his stake in Paramount and eventually acquired the company in the 1990s for $10 billion.
Never gives up
Redstone’s ambitious plans came to a halt briefly when he suffered third-degree burns over 40% of his body in a fire at a hotel in Boston in 1979. He survived by crawling out onto the window ledge, where he was rescued by firefighters, and had to undergo 30 hours of surgery. Redstone often told this story, and the underlying lesson was obvious: Sumner Redstone never gives up.
After rehabilitation, Redstone was back on the acquisition trail, and his sights were set on Viacom (whose name is short for “video and audio communications”).
Viacom was spun off from CBS in 1971, after the Federal Communications Commission ruled that TV networks couldn’t syndicate their own programs once they had finished their run on regular TV. So the company became a stand-alone entity that syndicated CBS hits like Hawaii Five-0, as well as shows from other networks such as The Cosby Show and All in the Family. Viacom also owned MTV Networks and the Movie Channel.
Redstone took control of Viacom in 1986 for $3.4 billion after a four-month hostile takeover battle, and then embarked on a series of acquisitions, including Paramount Communications, which he won only after a long and tense bidding war with John Malone and Barry Diller.
Redstone also acquired CBS, the former parent of Viacom, in 2000 for $40 billion, and later spun it off as a separate entity, one which holds all of Paramount’s TV shows and back catalog. And Viacom acquired Blockbuster Entertainment, which included TV giant Aaron Spelling’s production company. In 2005, Redstone acquired DreamWorks SKG—the studio cofounded by Steven Spielberg—for $1.6 billion.
The battle over control of Redstone’s empire started years before his health began to fail. His trusts initially made it clear that his daughter, Shari Redstone—from his first marriage, which ended in 1999—would assume his role as chairman of Viacom and CBS after his death. In 2016, he stepped away from day-to-day management, handing the reins to Shari, with whom he had a contentious relationship over the years.
Last year, Shari Redstone remerged the two entities—CBS and Viacom—and now serves as chairwoman. In May, she told Wall Street analysts the company was seeing “significant growth” in demand for its content. The ad business, however, has been hit by the pandemic, as is the case with rival media companies.
Live-in girlfriend
In late 2015, the billionaire’s former live-in girlfriend Manuela Herzer—who was 40 years Redstone’s junior—filed suit, claiming that Redstone’s signature had been forged on a document, and that he was being manipulated by those who wanted to control his assets and business affairs. At that point, Viacom CEO Philippe Dauman had taken over responsibility for Redstone’s medical care.
Although Herzer’s lawsuit questioned whether the billionaire was in control of his faculties, Dauman and others close to Redstone maintained that he was still involved in his companies, and a video deposition showed that while he was physically frail, Redstone was still able to testify in a profanity-laced statement to the court. He also said he had repaired his relationship with his daughter, who will now exercise a significant degree of control over the fate of his Viacom and CBS holdings.
Following the court case over Sumner’s mental abilities, the two Redstones went after Dauman, whom they blamed for the underperformance of the company’s stock. After a legal battle, Sumner Redstone removed him from the board of directors of his family trust, and not long afterward Dauman was forced to step down as CEO.
‘I will miss him always’
In his final years, Redstone and his daughter, Shari, appeared to have patched up their earlier differences. Shari Redstone on Wednesday spoke fondly of her father and his legacy.
“My father led an extraordinary life that not only shaped entertainment as we know it today, but created an incredible family legacy,” Shari Redstone told Variety. “Through it all, we shared a great love for one another, and he was a wonderful father, grandfather, and great-grandfather. I am so proud to be his daughter, and I will miss him always.”
Although Sumner Redstone was one of the wealthiest men in the world, he often denied that he was motivated by a desire to be rich. In a speech he gave to graduating law students at Boston University in 2007, the old-fashioned media mogul said: “Money, and I mean it sincerely, has never motivated me. The passion to win has motivated me.” And win he certainly did.
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This story was originally featured on Fortune.com
