Moguls Lighten Their Wallets, but Not So’s You’d Notice

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From Iger to Murdoch to Bewkes, TheWrap's second annual look inside the media execs' paychecks

Like everyone else, media moguls did some belt-tightening in the recession era.

Nearly every one of the top entertainment chiefs consented to lightening their wallets in 2009, a year when the economy struggled to recover from a terrifying nosedive and media companies laid off hundreds of employees.

A Wrap investigation into public records found:

* At $19.9 million, News Corp. CEO Rupert Murdoch took a 28 percent cut in his total compensation package from $27.5 million in 2009, based on the company's annual SEC filings.

* Bob Iger, CEO of the Walt Disney Company, and Les Moonves, CEO of CBS, took smaller 17 and 12 percent cuts — though they still managed to rake in $21.6 million and $32 million respectively, according to public records.

* Viacom CEO Philippe Dauman cut his earnings by 26 percent — but still pulled in upwards of $10 million. And that company's Executive Chairman Sumner Redstone shaved his total compensation by a million dollars — to $5.2 million.

(See also: Media mogul salaries in 2008.)

But, people — save your tears. Even after pulling in the reins, salaries in most of Hollywood's executive suites remained safely ensconced in the seven- to eight-figure range.

And their take-home pay is miles ahead of the New Media giants at Google and Amazon.

 

Time Warner chief Jeff Bewkes actually helped himself to a pay bump. His base salary, long-term incentives and annual bonus jumped from $19 million to $22 million — an increase of 15 percent.

That's probably because earnings for Time Warner have improved now that the vast media empire has finally unloaded the profit-killing AOL.

The company posted a profit of $627 million for the most recent quarter reported, compared with a loss of $16 billion in the same period last year.

It was also helped by a record-shattering year at the box office and a gradual uptick in advertising revenues.

But Time Warner wasn't alone in seeing its earnings recover from last year's lows.

News Corp. reported a profit of $254 million for its most recent quarter compared with a $6.4 billion loss in the same period a year ago.

Over at Viacom, the company recently posted a quarterly profit of $463 million, or 76 cents a share, from $401 million, or 65 cents a share, a year earlier. That was mostly due to a series of cost-cutting measures, as the company's overall revenue actually declined by 2.7 percent.  

Still, media moguls' multi-million-dollar salaries have to smart in a period when almost every one of them presided over mass layoffs.

Warner slashed 10 percent of its global workforce last January.

Disney killed 1,900 positions last spring, and studio chief Rich Ross has led an aggressive restructuring that's opened the exit door for many in the marketing and distribution departments.

Viacom laid off 850 people, or 7 percent of its workforce, at the tail end of 2008, and Sony will get in on the bloodletting soon, having just announced its intention to lay off 450 employees, or 6.5 percent of the staff.

And what about the movie moguls? They're not in the public earnings statements, but we have a pretty good idea, based on knowledgeable sources.

The moguls running the studios make big bucks, in any economy. Universal Studios president Ron Meyer earns about $15 million a year under his current contract.

Sony Pictures Entertainment co-chairmen Michael Lynton and Amy Pascal take home about $8 million, each. Other studio chairmen are believed to make in the $5 million range.

Even these lower level pashas are positively flush compared to their New Media counterparts. 

Chief executives at the online upstarts earn a fraction of what Bewkes, Redstone and Iger make in a year, despite robust growth.

Even a relatively small fish like Lionsgate CEO Jon Feltheimer, whose company saw theatrical revenues decrease in 2009 and its stock price remain stagnant, still makes $4 million, more than double the amount earned by prominent executives from the tech sector.
No figures are available yet for 2009, but:

*Jeff Bezos at Amazon has consistently earned $1.3 million annually,

* Reed Hastings at Netflix earned $2.8 million in 2008, and

* Eric Schmidt at Google made a mere $508,763 that same year. 

These executives all receive huge packages of stock options, rather than multi-million-dollar base salaries.

Those companies performed far better than their counterparts in traditional media.

Google recently announced that revenue was up 17 percent in the fourth quarter of 2009 ($6.7 billion) and up $23.65 billion for all of 2009 (for a net income of $6.5 billion), helped in no small part by its entry into the mobile phone market. 

Thanks to the growing popularity of the Kindle, Amazon saw fourth-quarter earnings rise 71 percent year-over-year. Amazon reported profits of $384 million, or 85 cents a share, compared to $225 million, or 52 cents a share, for the same period the previous year.

Netflix continues to corner the market on online subscription movie rentals, and its most recent quarter was one of its best ever.

The company's fourth-quarter profits jumped 36 percent to $30.9 million from $22.7 million in 2008's final quarter, while sales climbed 24 percent to $445 million from $359 million in the year-ago quarter.

And if you think stock prices were a reason for the inflated salaries — um, not so much.

While shares of Google and Amazon trade for $536 and $118 respectively, stock prices for most Old Media companies improved but were hardly blue chip.

Time Warner stock surged to $27 from $18 a year ago, News Corp. shares more than doubled to over $12 from $6 at the same point, and Viacom's class A stock rose from $17 to over $30.

After the beating that occurred in the fall of 2008, the increase in stock price reflected the slow national recovery as much as it did any visionary leadership in the board room. 

Yet even after scaling back their compensation, Murdoch, Redstone, Iger and their ilk still command big salaries that don't reflect the current business climate.

Only in Hollywood.