October 20, 2020

We Knew They Got Raises. But This?

A preliminary examination of executive pay in 2010, based on data available as of April 1, found that the paychecks for top American executives were growing again, after shrinking during the 2008-9 recession.

But that study, conducted for The New York Times by Equilar, an executive compensation data firm based in Redwood City, Calif., was just an early snapshot, and there were even more riches to come. Some big companies had not yet disclosed their executive compensation.

So Sunday Business asked Equilar to run the numbers again.

Brace yourself.

The final figures show that the median pay for top executives at 200 big companies last year was $10.8 million. That works out to a 23 percent gain from 2009. The earlier study had put the median pay at a none-too-shabby $9.6 million, up 12 percent.

Total C.E.O. pay hasn’t quite returned to its heady, prerecession levels — but it certainly seems headed there. Despite the soft economy, weak home prices and persistently high unemployment, some top executives are already making more than they were before the economy soured.

Pay skyrocketed last year because many companies brought back cash bonuses, says Aaron Boyd, head of research at Equilar. Cash bonuses, as opposed to those awarded in stock options, jumped by an astounding 38 percent, the final numbers show.

Granted, many American corporations did well last year. Profits were up substantially. As a result, many companies are sharing the wealth, at least with their executives. “We’re seeing a lot of that reflected in the pay,” Mr. Boyd says.

And at a time of so much tumult in the media business, it might be surprising that some executives in media and communications were among the most richly rewarded last year.

The preliminary and final studies put Philippe P. Dauman, the chief executive of Viacom, at the top of the list. Mr. Dauman made $84.5 million last year, after signing a new long-term contract that included one-time stock awards.

Leslie Moonves, of the CBS Corporation, got a 32 percent raise and reaped $56.9 million. Michael White of DirecTV was paid $32.9 million, while Brian L. Roberts of the Comcast Corporation and Robert A. Iger of the Walt Disney Company each received pay packages valued at $28 million.

“Media firms seemed to be paying a lot,” said Carol Bowie, head of compensation policy development at ISS Governance, which advises large investors on corporate governance issues like proxy votes. “Media companies in general tend to be high-payers, and they tend to feed off each other.”

Other big payers included oil and commodities companies like Exxon Mobil and a few technology giants like Oracle and I.B.M.

Some of the other highly paid executives on the new list who were not in the April survey are Gregg W. Steinhafel of Target, who had a $23.5 million pay package; Michael E. Szymanczyk of Altria, $20.77 million; and Richard C. Adkerson of Freeport-McMoRan Copper Gold, $35.3 million.

Most ordinary Americans aren’t getting raises anywhere close to those of these chief executives. Many aren’t getting raises at all — or even regular paychecks. Unemployment is still stuck at more than 9 percent.

In some ways, chief executives seem to live in a world apart when it comes to pay. As long as shareholders think that the top brass is doing a good job, executives tend to be well paid, whatever the state of the broader economy. And some corporate boards were probably particularly generous in 2010 after a few relatively lean years for their top executives. In other words, some of this was makeup pay.

“What is of more concern to shareholders is that it looks like C.E.O. pay is recovering faster than company fortunes,” says Paul Hodgson, chief communications officer for GovernanceMetrics International, a ratings and research firm.

According to a report released by GovernanceMetrics in June, the good times for chief executives just keep getting better. Many executives received stock options that were granted in 2008 and 2009, when the stock market was sinking.

Now that the market has recovered from its lows of the financial crisis, many executives are sitting on windfall profits, at least on paper. In addition, cash bonuses for the highest-paid C.E.O.’s are at three times prerecession levels, the report said.

Of course, these sorts of pay figures invariably push the buttons of many ordinary Americans. Yes, workers’ 401(k)’s are looking better than they did in some recent years, but many investors still have not recovered from the hit they took during the financial crisis. And, of course, millions are out of work or trying to hold on to their homes — or both.

And it’s not as if most workers are getting fat raises. The average American worker was taking home $752 a week in late 2010, up a mere 0.5 percent from a year earlier. After inflation, workers were actually making less.

Article source: http://feeds.nytimes.com/click.phdo?i=534e36a9c2b4990668faa347827c1365

Viacom Reports 20% Increase in Revenue, While Discovery Posts 9% Rise

The company, which owns the cable channels MTV, VH1 and Nickelodeon and the movie studio Paramount Pictures, said that its revenue was $3.27 billion in its fiscal second quarter, up from $2.73 billion in the period a year ago. Net income for the quarter was $376 million, or 63 cents a share. That was a 53 percent gain over the same quarter a year ago, when the company had net income of $245 million, or 40 cents a share. It generally topped analysts’ expectations.

“Viacom has never been stronger financially,” Philippe P. Dauman, the chief executive, said Thursday in a conference call with investors. Mr. Dauman said that Viacom, which is controlled by Sumner M. Redstone, intended to accelerate its stock buyback program and increase its dividend by an unspecified amount. The biggest part of Viacom, its cable channel arm, remains healthy. Together, the channels exceeded $2 billion in revenue for the quarter, up 11 percent from the same quarter last year.

Mr. Dauman credited “phenomenal” ratings for several shows, chief among them “Jersey Shore,” the reality show about hard-partying young men and women that had its third season during the quarter. The season averaged about 7.7 million viewers, making it the most popular show in MTV’s history.

Mr. Dauman indicated that MTV would seek high premiums for future seasons of “Jersey Shore” and other shows.

Over all, Viacom said it had posted an 11 percent gain in domestic advertising revenues, the fifth consecutive quarter of improvement in that growth rate.

Viacom has also nurtured shows that are considered hits for its other channels: “iCarly” for Nickelodeon, “Tosh.0” for Comedy Central, “The Game” for BET. Mr. Dauman said the company was seeking ratings improvements at two other channels, VH1 and Spike, by adjusting their programming schedules. Revenue and profit for Viacom’s filmed entertainment arm fluctuate depending on the performance of its feature films and the sales of DVDs of those films.

In the quarter that ended in December, Viacom’s earnings declined in large part because of weakness in this area. But in the quarter that ended March 31, the filmed entertainment arm had $1.2 billion in revenue, up from $638 million in the previous quarter and $886 million in the fiscal second quarter a year ago.

Viacom stock was up 3.8 percent Thursday to close at $58.14, a 52-week high.

Discovery Communications, another owner of cable channels, also reported double-digit advertising gains on Thursday.

Discovery, which owns the Discovery Channel, TLC and Animal Planet among others, posted revenue of $951 million in the first quarter, up 9 percent over the same quarter last year.

Thanks in part to a one-time gain related to the formation of OWN: The Oprah Winfrey Network in January, Discovery posted net income of $305 million, or 74 cents per share, up from $169 million, or 39 cents per share, in the same quarter last year.

International revenue grew faster than domestic revenue for Viacom and Discovery. David Zaslav, the chief executive of Discovery, said his company had benefited from a “continued favorable economic climate.”

Discovery shares gained 1.8 percent to close at $43.14.

Article source: http://feeds.nytimes.com/click.phdo?i=b334711483f0df1bec5ad02d9e7a5604

Media Decoder: Time Warner Cable and Viacom Seek Ruling on iPad App

Time Warner Cable and Viacom each filed lawsuits on Thursday that seek to resolve a stormy dispute in the television business over the right to stream channels to new devices like iPads.

Cable companies like Time Warner Cable say their existing contracts with channel owners like Viacom cover devices like iPads that can be turned into television sets. Some of the channels owners disagree, and they have been exchanging threats with Time Warner Cable ever since its TWCableTV app was released in mid-March.

When Viacom, Scripps Networks, Fox Cable Networks and Discovery Communications threatened legal action a week ago, Time Warner Cable temporarily removed their channels from the app. But it said it would pursue legal options, and on Thursday afternoon, the company filed a request for a declaratory judgment in favor of its app — and against Viacom — in Federal District Court for the Southern District of New York.

The company’s general counsel said Time Warner Cable was “asking the court to confirm our view” that the company has the rights to in-home viewing of channels on any screen.

Minutes later, Viacom said it ad filed its own suit in the same court for breach of contract and copyright violations.

In its suit, Viacom asserted that the iPad app amounted to “unlicensed distribution of Viacom’s programming.” It also acknowledged what other channel owners have said privately: that having cable companies like Time Warner Cable extending the TV viewing to tablets could damage its business.

Time Warner Cable’s actions “will interfere with Viacom’s opportunities to license content to third-party broadband providers and to successfully distribute programming on its own broadband delivery sites,” Viacom said.

Viacom has been the most aggressive of all the channel owners in the app battle. A statement accompanying its lawsuit suggested that it expected new payments for the rights to stream to tablets: “With $5.2 billion in cash from operations last year, Time Warner Cable can certainly afford to provide our programming through this new broadband service without passing along any additional costs to its customers.”

Time Warner Cable, with more than 14 million customers, is the second-largest cable company in the United States, after Comcast. Time Warner said Thursday that its app had been downloaded more than 360,000 times. Cablevision, which has about 3.5 million customers, released a more sophisticated streaming app last week, and on Wednesday it said it had counted more than 50,000 downloads.

Other cable companies are known to be developing similar apps, and may face similar rights issues with channel owners.

Article source: http://feeds.nytimes.com/click.phdo?i=f422384537823b7d940896ed81d5a808

Media Decoder: Time Warner Pulls Channels From iPad App

Time Warner Cable on Thursday abruptly removed several channels from its app that replicates the TV viewing experience on an iPad.

The cable company withdrew the channels, including MTV and FX, after receiving complaints from three major media companies, Viacom, Discovery Communications and the News Corporation.

The companies have claimed that the iPad app is a contract violation — in part because they want cable companies like Time Warner Cable to pay them more for the privilege to stream their channels to portable devices. Viacom and the News Corporation had sent cease-and-desist letters to Time Warner Cable in recent days.

The iPad, in essence, is the latest battleground for a long-running fight about how television will be delivered in the digital age, and by which companies. Time Warner Cable reaffirmed on Thursday that it believed it had “every right to carry the programming on our iPad app.”

It said in a statement: “But, for the time being, we have decided to focus our iPad efforts on those enlightened programmers who understand the benefit and importance of allowing our subscribers — and their viewers — to watch their programming on any screen in their homes. In the meantime, we will pursue all of our legal rights against the programmers who don’t share our vision.”

Earlier in the week, Time Warner Cable started a public campaign to rally support for the app, which was released in Apple’s app store earlier in the month. “The enthusiasm of our customers and the programming partners who have embraced the app, rather than those who are solely focused on finding additional ways to reach into wallets of their own viewers, has convinced us more than ever that we are on the right path,” the company said Thursday.

A company spokesman said that it would add new channels overnight, effectively replacing the channels that were removed on Thursday. The app previously had 32 channels, only a portion of the channels available through the traditional set-top box.

The debate over the app boils down to this question: When companies like Time Warner Cable buy the rights to beam channels to customers’ television sets, do those rights extend to new screens like iPads? After all, computers, iPads and mobile phones can all act as TV screens.

Other cable companies are working on their own streaming apps for the iPad. Cablevision said Thursday that it had released its app “on Cablevision’s campus and in approximately 100 employee homes and it works wonderfully.”

The company had previously said it would unveil the app by the end of the first quarter, which ends Thursday. “The application has been submitted to Apple and, upon its approval, will be available to our cable television customers,” Cablevision said in a statement.

Cablevision’s app is said to transfer every existing channel and video-on-demand option to the iPad, just like a set-top box. The company declined to say whether it had heard complaints from channel owners.

Article source: http://feeds.nytimes.com/click.phdo?i=46daf7d155d954101d766014a9cb7c2c