MEL KARMAZIN TO REMAIN WITH VIACOM

President-COO Signs New Three-Year Contract

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NEW YORK (AdAge.com) -- Viacom today announced that Mel Karmazin will remain as president and chief operating officer after his contract expires this year.

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

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concerned about the future of Mr. Karmazin, whom many see as a key to the success of the 2000 merger of Viacom and CBS. Mr. Karmazin had been president-CEO of CBS prior to the merger.

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.

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