The Media Captures the Greed Zone - Charlie Warner

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The Wall Street Journal's annual CEO compensation survey shows that half of the top 10 and top 12 most highly compensated CEOs are in the media, replacing Wall Street and financial services sector CEOs as the most outrageously overpaid in America.

The top six of the top 12 in 2010 were: Viacom's Phillip Dauman ($84.32 million) at #1, CBS's Les Moonves ($58.88 million) at #3, Direct TV's Michael White ($32.64 million at #5, Walt Disney's Robert Iger ($27.22 million) at #8, Time Warner's Jeff Bewkes ($26.01 million) at #10, and Comcast's Brian Roberts ($24.9 million) at #12.

In 2007 at the height of Wall Street and the financial sectors' arrogant and overarching greed, the 2008 Wall Street Journal's CEO compensation survey revealed that six of the top 10 highest paid CEOs were from Wall Street and finance: Merrill Lynch's John Thain ($78.52 million) at #1, Goldman Sachs' Lloyd Blankfein ($68.5 million) at #2, American Express' sKenneth Chenault ($46.23 million) at #4, Lehman Bros.'s Richard Fuld ($40 million) at #5, American Finance's James Cracchio ($29.57 million) at #6, and State Street's Ronal Logue ($21.2 million) at #8.

We know what the overpaid CEOs did to earn their unconscionably high compensation in 2007, they propelled the country into the Great Recession with their greed and self-interested, highly risky manipulation of complex debt instruments. They thought they were smarter than everyone else and that regulators were lazy, stupid, and in their pockets, which why they got away with their chicanery.

What did the media CEOs do in 2010 to earn their unconscionably high compensation ? Well, they didn't cause a financial meltdown, but they certainly didn't help us get out of the recession with any notable public service activity, enlightening news coverage that helped bring to justice anyone guilty of fraud, help explain the meltdown, or create massive jobs.

The most notable accomplishment Phillip Dauman can claim for his $84 million is MTV's hit show Jersey Shore, which could certainly be considered a cultural recession – a low point in taste, meaning, and worth. Robert Iger did a lot better for about a third of what Dauman made with Pixar's Toy Story 3, a high point in taste, meaning, and worth.

Like the Wall Street moguls of 2007, the media moguls of 2010 think they are smarter than everyone else and that regulators are lazy, stupid, and in their pockets. Programming is worse, e.g. Jersey Shore, TV and cable viewing is down as viewers switch to mobile devices, and the FCC approved the Comcast-NBC Universal merger, shortly after which one of the FCC commissioners who voted to approve the merger went to work as a high-paid lobbyist for Comcast. Welcome to the pocket.

The blog Deadline New York got it right with its post "Media Moguls With Out-of-Whack Pay Compensation" and "Media Moguls With Pay Compensation NOT Out-of-Whack," when it indicated that the companies that gave the media moguls such outrageous pay packages broke SEC rules. Here's what Deadline New York's Executive Editor David Lieberman wrote on April 21:

This is exactly the kind of information that shareholders of Big Media need to know but rarely see. It's considered a red flag when any public company pays one of its bigwigs -- usually the CEO -- three times more than the average for the four other top executives which the SEC requires them to list. So I've taken proxy statements and done the computations and discovered that at least 16 of 35 companies failed that test. Often miserably. Nearly half of the media company compensation packages disclosed so far for 2010 show a startling degree of hero-worship as boards of directors pay their top dogs sums that far exceed what the pay was for other top execs in the company.

If you're a stockholder of any of these media companies, or an ordinary citizen, you should be outraged by these excesses and show your outrage by boycotting the products (programming and distribution) of those gluttons in the Greed Zone.

Unfortunately, that's easier said than done. I know I don't have the willpower to stop watching live baseball on ESPN (owned by Disney), and most Americans seemed similarly hooked on some form of addictive entertainment. No wonder the media moguls make as much as drug lords; they sell the same addictive products and live lavishly in the Greed Zone, as a result of provide their customers junk.

Until he retired in 2002, Charlie Warner was Vice President of AOL's Interactive Marketing division. Before joining AOL, he was the Goldenson Endowed Professor at the Missouri Journalism School where he taught media management and sales, and he created and ran the annual Management Seminar for News Executives. Charlie can be contacted at charleshwarner@gmail.com.

Read all Charlie’s MediaBizBloggers commentaries at The Media Curmudgeon.

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