Mel Karmazin says Thomas Middelhoff is an extraordinarily talented chief executive, as talented as any in the US.
But Karmazin, the no-frills New Yorker who is president of the media conglomerate Viacom, cultivates a very different style from Middelhoff, the big-thinking German who until last week ran the media conglomerate Bertelsmann.
In a commercial he commissioned for German television, Middelhoff appeared wearing a "Star Trek" uniform under the slogan, "We pursue big ideas -- no matter where they lead us." Karmazin showed up for a recent conference call with institutional investors in a T-shirt that said, "We will not do anything stupid."
The differences between Viacom and Bertelsmann run far deeper than slogans on T-shirts, of course, and they say a lot about why Viacom today is the world's most valuable media empire, while Bertelsmann jettisoned Middelhoff last week.
Viacom is the only global media conglomerate that never succumbed to the allure of the Internet. It has steadfastly resisted the defining "big idea" of the 21st-century media business: that the Internet will profoundly transform the way people consume information and entertainment, necessitating radical changes in the way companies distribute their movies, television shows, music and magazines.
It is not that Viacom rejects the importance of the Internet -- or even the notion that it is changing the habits of consumers, particularly young ones, in ways that will generate exciting new businesses.
But unlike Bertelsmann under Middelhoff, Vivendi Universal under Jean-Marie Messier or AOL Time Warner under Gerald M. Levin and Robert W. Pittman, Viacom did not bet its corporate ranch on convergence -- the marriage of old-line media assets with Internet-age technology.
At Viacom, the Internet functions largely as a brand extension -- a vehicle to enhance the company's existing properties, from Paramount Pictures and MTV to CBS and Blockbuster.
Middelhoff, Messier and Pittman, the chief operating officer at AOL Time Warner, were all shown the door within three weeks of one another. So if career survival is any guide, Viacom's pragmatic approach appears to have been the right bet.
"Convergence may be the most expensive word in history, said David Geffen, who is co-founder of DreamWorks, the movie studio, with Steven Spielberg and Jeffrey Katzenberg. "It has cost people billions."
Like most media moguls, Geffen doesn't dispute the contention that digital technology is blurring the boundaries between the television, the PC and the telephone. But a huge number of multimillion-dollar investments has shown that extracting a profit from this convergence is extraordinarily difficult, particularly when companies try to meld assets from disparate industries -- say, cellphones with Hollywood entertainment.
The upheavals at AOL Time Warner, Bertelsmann and Vivendi stemmed in part from the inability of their top executives to cope with the unwieldy goliaths they had created. "Nobody has an expertise that runs across every single medium," Geffen said.
MTV.com, the Web site for Viacom's ubiquitous music video channel, offers surfers the chance to listen to music, watch streaming video or buy concert tickets. Yet the site, among the most heavily visited on the Web, is at heart an electronic billboard for MTV. "Our strategy is tied into these strong brands, and in having a platform to cross-promote them," Karmazin said.
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