Further Restructuring Expected at Viacom

NEW YORK/LOS ANGELES, September 6: According to local
reports, speculation is mounting that Brad Grey’s future as the head of
Paramount is uncertain following the ousting of Viacom’s president and CEO Tom
Freston by executive chairman Sumner Redstone at the beginning of this week.

Freston handpicked Grey, a former Hollywood agent, to serve
as the chairman and CEO of Paramount Pictures. Shortly thereafter, Grey poached
FOX’s entertainment chief, Gail Berman, to serve as president of Paramount
Pictures. Freston, Grey and Berman were all notably silent during Redstone’s
spat with Tom Cruise last month, when Redstone said that the studio was
severing ties with the actor over his bizarre behavior.

Freston’s ousting indicates that Redstone is angling to take
back a leading role at the company. The 83-year-old ceded the CEO title at
Viacom following the separation of the company at the beginning of this
year—Freston took the helm of the new Viacom, while Les Moonves was
tapped to oversee CBS Corporation. Viacom’s stock price has fallen since the
split, and according to the New York Times,
Redstone believes that that is due in part to Freston not having been
aggressive enough in terms of Internet opportunities.

Redstone reportedly invited Freston to his home on Monday to
ask him to resign, the Times said. “It was a very difficult meeting with Tom. I
was practically crying. He did a very good job in building the MTV networks.”

On his choice for Freston’s successor, Philippe Dauman, Redstone
said, “Philippe would enhance our growth and would be more aggressive and
entrepreneurial and would never let anything end up in the competitors’ camp.’’
Redstone was reportedly referring to Viacom having been outbid by News
Corporation for MySpace.