The media giant said Mr. Karmazin and Chairman-CEO Sumner Redstone signed new employment contracts effective May 5. Mr. Karmazin's contract has a three-year term ending May 5, 2006.
Investors had been increasingly
Downplayed reports of friction
In recent meetings with investors, Mr. Redstone had taken pains to downplay reports of friction between the two executives.
After Mr. Redstone failed in a bid to unseat Mr. Karmazin in early 2002, the two settled into a boardroom detente that fed speculation that Mr. Karmazin's contract would not be renewed.
The tension escalated after Mr. Karmazin decided to withhold a portion of CBS inventory in a weak spring 2001 network upfront market, betting on an ad rebound. Although the strategy cost the network some $250 million in sales, it eventually paid off in higher scatter prices.
Mr. Karmazin will continue to report to Mr. Redstone.