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Showbiz moguls’ favorite contract clause: living forever

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America may be the world’s greatest democracy, but in show business, we still have kings -- and they usually have royal succession plans. That’s the only way to view the news that Peter Chernin, perhaps the savviest media executive on the planet, has walked away from his exalted perch as Rupert Murdoch’s second in command at News Corp., the company that owns everything from 20th Century Fox and the Fox Network to the Wall Street Journal and the New York Post. According to Michael Wolff, who probably knows the ways of Murdoch better than anyone, having spent an extraordinary amount of time with the soon-to-be 78-year-old mogul while writing ‘The Man Who Owns the News: Inside the Secret World of Rupert Murdoch,’ Chernin left over what you might call an actuarial issue.

As Wolff put it on his blog today: ‘The contract issue was straightforward: Chernin wanted Murdoch’s word that if Murdoch departed (carried out or otherwise), Chernin would get his job. That’s the deal they struck four years ago when Chernin’s contract was renewed. But now Murdoch, at 78, wants to know that if he goes, one of his children -- likely his son James -- will take over.’

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Having been hanging around News Corp. while writing his book, Wolff has a bundle of inside-the-Evil-Empire gems about Murdoch and Chernin’s complicated, not altogether amicable relationship. Even though Murdoch’s older offspring all have had serious business careers, Wolff quotes Chernin as calling them ‘the cretins.’ Wolff also captures a comical scene in Murdoch’s office in the middle of the presidential primaries when Murdoch’s communication aide, Gary Ginsberg, a Chernin loyalist, speculated that if Hillary Clinton won the presidency it would give Chernin, one of her biggest fundraisers, a shot at being secretary of the Treasury or even secretary of State. Wolff writes that Murdoch replied, with memorable disdain: ‘At best, Commerce.’

Still, with his media empire being buffeted on many fronts and News Corp. stock nearly 75% off its peak, why wouldn’t Murdoch be more willing to placate Chernin, who is viewed even by his media conglomerate rivals as the consummate corporate player? The answer has far more to do with personal psychology than corporate gamesmanship. Like nearly all showbiz moguls, Murdoch thinks he’ll live forever. It’s a firm belief apparently shared by many of his contemporaries, notably Viacom’s Sumner Redstone, who at 85 has hired and fired or otherwise fended off a host of talented apparent successors, including Mel Karmazin, Tom Freston and Redstone’s own daughter, Shari Redstone.

Moguls are rarely comfortable naming a successor -- to them, it feels like a sign of weakness, a symbol of mortality. When push came to shove, Disney’s Michael Eisner wouldn’t give Jeffrey Katzenberg the company’s No. 2 job, then brought in Michael Ovitz, who quickly discovered that he wasn’t in line to run Disney either. Even in the midst of a mysterious and perhaps life-threatening illness, Apple’s Steve Jobs hasn’t named a successor. If you’re Murdoch or Redstone’s age, why not prepare for an orderly exchange of power? If you’re Redstone, the answer is easy -- he’s in denial. He tells everyone that he’s going to live forever, thanks to all sorts of magic potions that he drinks every day. Both Murdoch and Redstone have married young women, which they clearly see as another sign of their vigor and potency.

‘Rupert can’t imagine that he’s going to die,’ says one highly placed Murdoch watcher. ‘These guys just aren’t in touch with reality. Look at Rupert’s hair -- he won’t even admit to going gray. The only person with a worse dye job is Paul McCartney. For them, giving up power would be the equivalent of dying. And as long as Wall Street doesn’t say -- we’re not going to buy your stock until you arrange a succession plan -- they can get away with it.’ It’s true -- power is a powerful aphrodisiac. What else would these guys do with themselves? Old Universal studio hands remember that long after Lew Wasserman had sold the studio, he still came to his office every day, even though his power was gone and his desk was empty. It was his life.

Murdoch is clearly made out of the same stuff. It hardly matters which one of his kids ends up with News Corp. It will be a mixed blessing, since Murdoch will leave them with big shoes to fill. For Chernin, who has the best showbiz exit package known to man, life will begin anew. He certainly won’t be forgotten. With all the turmoil in today’s media world, every time a company’s stock crumbles or a mogul like Redstone or Jobs goes home sick, you’ll see Chernin’s name at the top of every financial analyst’s successor wish list.

Both Chernin and Murdoch went to Barry Diller’s oh-so-exclusive Saturday Oscar picnic, mixing with the likes of David Geffen, Eisner, Les Moonves, Brad Grey, Bob Iger and Eli Broad. I asked someone who was at the party if they could divine Chernin’s mood. He laughed. ‘Let’s just say that Chernin looked like he was in far better spirits than Rupert.’

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