Sumner Redstone

Sumner Murray Redstone (born Sumner Murray Rothstein; May 27, 1923 – August 11, 2020) was an American businessman and media magnate who built National Amusements, a family-owned theater chain, into a controlling stake in Viacom and CBS Corporation, creating one of the largest media empires in the world. His aggressive acquisition strategy, legendary toughness, and famous declaration that "content is king" shaped the modern media industry.

Redstone's final years were marked by bitter family feuds, lawsuits over his mental capacity, and battles between competing executives and companions for control of his fortune. His daughter Shari Redstone ultimately gained control of the family companies and orchestrated the 2019 re-merger of CBS and Viacom into Paramount Global. Redstone died on August 11, 2020, at age 97, leaving behind a complicated legacy of business achievement and personal drama.

Early life and education

Sumner Murray Rothstein was born on May 27, 1923, in Boston, Massachusetts, to Belle (née Ostrovsky) and Michael Rothstein. His father was a driving school owner who changed the family name to Redstone in 1940, believing the original Jewish name would be a barrier to success.

Redstone grew up in the working-class Charlesgate neighborhood of Boston. Despite modest circumstances, he excelled academically, graduating from Boston Latin School, one of the country's most prestigious public schools, and winning a scholarship to Harvard University.

At Harvard, Redstone's academic gifts became apparent. He graduated in 1944 with a degree in languages, having studied Japanese. During World War II, he served as an Army intelligence officer assigned to break Japanese military codes. His codebreaking unit was credited with significant contributions to the war effort in the Pacific theater.

After the war, Redstone attended Harvard Law School, graduating in 1947. He briefly practiced law in Washington, D.C., and served as a special assistant to U.S. Attorney General Tom C. Clark. However, the family business would soon pull him away from his legal career.

Career

National Amusements

In 1954, Redstone joined National Amusements, his father's drive-in movie theater chain based in Dedham, Massachusetts. Though initially reluctant to leave law, Redstone eventually committed himself fully to the business.

Under Redstone's leadership, National Amusements grew from a modest regional chain into one of the largest theater operators in the United States. Key to this growth was his pioneering of the multiplex concept—theaters with multiple screens that could show several films simultaneously, increasing efficiency and customer choice.

Redstone proved to be a fierce competitor and shrewd dealmaker:

Expanded from drive-ins into indoor multiplexes
Built new theaters in strategic locations
Acquired competing chains
Fought antitrust battles with major studios over distribution practices

By the 1980s, National Amusements had grown into a substantial company with hundreds of screens. More importantly, the cash flow from the theater business gave Redstone the resources to pursue larger ambitions.

Copley Plaza Hotel fire (1979)

On March 29, 1979, Redstone was trapped by fire in his room at the Boston Copley Plaza Hotel. The fire killed three people and injured 30 others. Redstone survived by hanging from a third-floor window ledge until firefighters could rescue him, suffering severe burns over 45% of his body. His right wrist was so badly burned that doctors considered amputation.

Redstone spent months in recovery, undergoing numerous surgeries and extensive rehabilitation. The experience profoundly affected his outlook on life and business. He later credited the near-death experience with intensifying his drive and ambition: "If I was going to come back, I was going to come back strong."

The burns left lasting scars on his hands and face, but Redstone returned to business with greater intensity than ever.

Viacom acquisition (1987)

In 1987, Redstone launched an audacious hostile takeover of Viacom, a media company that owned cable networks MTV and Nickelodeon, and had significant television syndication operations. The company was much larger than National Amusements, making the bid a classic leveraged buyout.

Redstone outbid several competitors, including investor Carl Icahn, ultimately paying $3.4 billion for Viacom. The acquisition was heavily leveraged, with National Amusements borrowing substantially to finance the deal. Many analysts predicted the debt load would sink both companies.

Instead, Redstone proved remarkably adept at running media properties. Under his ownership, Viacom:

Grew MTV into a global brand
Expanded Nickelodeon into a dominant children's network
Built VH1 into a successful music channel
Developed television production capabilities

Paramount Pictures acquisition (1994)

In 1993, Redstone launched a bid for Paramount Communications, parent company of Paramount Pictures film studio. The acquisition battle became one of the most dramatic in corporate history.

Competing bidder Barry Diller, then at QVC, pursued Paramount simultaneously, leading to a months-long public battle. Redstone raised his bid multiple times, ultimately prevailing with an offer of approximately $10 billion. The victory was sealed when Viacom's stock price rose sufficiently to make its stock-and-cash offer more attractive.

The Paramount acquisition gave Viacom:

Paramount Pictures film studio
Paramount Television production
Simon & Schuster publishing
Sports franchises including Madison Square Garden (later divested)

CBS Corporation acquisition (1999)

In 1999, Viacom acquired CBS Corporation in a $37 billion deal that combined the two media giants. The merger created the second-largest media company in the world at the time, with holdings including:

CBS broadcast network
MTV, Nickelodeon, VH1, Comedy Central
Paramount Pictures
Blockbuster Video
Simon & Schuster
Numerous television stations and cable networks

Redstone believed that combining content creation with distribution would create synergies and competitive advantages. His mantra—"Content is king"—encapsulated his belief that owning valuable intellectual property was the key to media success.

Split and re-merger

In 2006, Viacom and CBS were split into two separate publicly traded companies, both still controlled by National Amusements:

CBS Corporation - broadcast network, television stations, CBS News, CBS Sports
Viacom - MTV Networks, Paramount Pictures, BET

The split was designed to allow the different businesses to pursue separate strategies and to improve stock valuations. Redstone remained chairman of both companies.

In 2019, after years of struggle and under Shari Redstone's leadership following her father's incapacitation, the companies were re-merged into Paramount Global.

Business philosophy

Redstone was known for several distinctive business principles:

"Content is king"

Redstone's most famous saying became an industry mantra. He believed that in an era of proliferating distribution channels, the companies that owned valuable content would ultimately control the industry. His acquisitions of Paramount, MTV, and other content creators reflected this belief.

Aggressive deal-making

Redstone was known for his willingness to pursue hostile takeovers and pay premium prices for assets he wanted. His persistence in the Paramount battle became legendary—he simply refused to lose.

Long-term ownership

Unlike many private equity investors who sought quick returns, Redstone believed in holding assets indefinitely. His famous quote: "Viacom is me. I am Viacom. That marriage is eternal, forever."

Cost control

Despite paying premium prices for acquisitions, Redstone was famously frugal operationally. He was known for scrutinizing expenses and demanding efficiency from executives.

Personal life

Marriage and children

Redstone married Phyllis Gloria Raphael in 1947, and they had two children:

Shari Redstone (b. 1954) - eventually became president of National Amusements and controlling shareholder of Paramount Global
Brent Redstone (b. 1951) - became estranged from the family after legal disputes

The marriage lasted over 50 years but was troubled. Phyllis filed for divorce in 1999, alleging that Redstone had numerous affairs throughout their marriage. The divorce was finalized in 2002, with Phyllis reportedly receiving over $1 billion in assets.

Relationships and companions

After his divorce, Redstone became known for relationships with much younger women:

Manuela Herzer - companion from 1999 to 2015
Sydney Holland - companion from approximately 2011 to 2015

Both women lived in Redstone's Beverly Hills mansion and were reportedly named in his estate plans. In October 2015, Redstone had both women removed from his home and struck from his will, setting off legal battles over his mental competency.

Family feuds

The Redstone family was marked by bitter internal conflicts:

Brent Redstone

Sumner's son Brent sued his father in 2006 over the value of his stake in National Amusements. The lawsuit alleged that Sumner had systematically undervalued Brent's holdings to benefit Shari. The case was settled in 2007, reportedly with Brent receiving approximately $240 million to exit the family business.

Shari Redstone

Sumner's relationship with his daughter Shari was complicated. For years, she worked in the family business but was frequently in conflict with her father, who publicly criticized her abilities. Their relationship improved in his final years, particularly after the removal of his companions, and Shari ultimately gained control of the family companies.

Mental capacity battles

Redstone's final years were marked by litigation over his mental capacity:

Manuela Herzer lawsuit (2015-2016)

After being removed from Redstone's home and will in October 2015, Manuela Herzer sued, claiming that Shari Redstone had manipulated an incapacitated Sumner. The case included disturbing testimony about Redstone's mental and physical condition, including claims that he could barely speak or write.

A judge ultimately ruled that Redstone had capacity to make decisions about his personal life, and Herzer's lawsuit was dismissed. However, the litigation revealed that Redstone's mental abilities had severely declined.

Philippe Dauman battle (2016)

Viacom CEO Philippe Dauman was also removed from Redstone's trust and the Viacom board. Dauman sued, claiming Shari had manipulated her father. The litigation eventually settled, with Dauman receiving approximately $72 million to depart.

Death

Sumner Redstone died on August 11, 2020, at his home in Los Angeles. He was 97 years old. The cause of death was not publicly disclosed.

His estate was reportedly valued at approximately $4.6 billion. The majority of his voting stock in National Amusements passed to a family trust controlled by Shari Redstone.

Controversies

Sexual harassment allegations

Multiple women alleged inappropriate conduct by Redstone over the years, though no lawsuits reached trial. Former companions alleged that Redstone was verbally abusive and controlling.

Executive compensation

Redstone's compensation as Viacom and CBS chairman drew criticism, particularly as his involvement in day-to-day operations decreased in his later years. Questions were raised about whether the boards were sufficiently independent to negotiate appropriate pay.

Treatment of Tom Freston

In 2006, Redstone abruptly fired Viacom CEO Tom Freston, a longtime executive credited with building MTV into a global brand. The firing was attributed to Viacom's failure to acquire MySpace (purchased by News Corp), but many observers believed Freston was unfairly scapegoated.

CBS/Viacom governance

The governance structure of Redstone's companies—with National Amusements holding controlling voting power despite owning only about 10% of economic value—drew criticism from corporate governance advocates who argued minority shareholders were disadvantaged.

Awards and recognition

Multiple broadcasting industry awards
Harvard Law School Association Award
Various philanthropic recognition
Hollywood Walk of Fame (not formally inducted)

Philanthropy

Redstone was a significant philanthropist, with major donations to:

Boston Latin School
Harvard University
Various Jewish causes
Medical research institutions

The Redstone family has continued philanthropic activities through various foundations.

Legacy

Sumner Redstone's impact on the media industry was enormous:

Pioneered the multiplex theater concept
Demonstrated that content companies could be more valuable than distribution networks
Proved that aggressive acquisition strategies could transform small companies into media giants
His "content is king" philosophy influenced a generation of media executives
Built companies that continue to operate as Paramount Global

However, his legacy is complicated by:

Family dysfunction that became public spectacle
Questions about corporate governance and succession planning
The challenges facing his companies in the streaming era
Personal controversies in his final years

References

<ref>"Sumner Redstone Profile".Forbes.Retrieved December 8, 2024.</ref>
<ref>"Sumner Redstone".Encyclopedia Britannica.Retrieved December 8, 2024.</ref>
<ref>"Sumner Redstone Coverage".{Template:Newspaper.Retrieved December 8, 2024.</ref>
<ref>"Sumner Redstone Coverage".{Template:Newspaper.Retrieved December 8, 2024.</ref>
<ref>"Sumner Redstone Obituary".{Template:Newspaper.Retrieved December 8, 2024.</ref>
Auletta, Ken. Greed and Glory on Wall Street. Random House, 1986.