You knew the Parents Television Council has had its finger on the “Send” button of this one ever since shock jock Howard Stern was rumored to be in the running to replace Piers Morgan as a judge on NBC’s summer hit America’s Got Talent. Well, the move became official this morning, and PTC president Tim Winter ripped into NBC brass for it. “The once-proud broadcast network has lost its way and has made it clear it holds no concern whatsoever for children and families,” he said “It also risks losing millions in advertising dollars.” It will be interesting to see how network execs and advertisers deal with Stern, who moved to satellite radio to get away from the constraints he’ll certainly find on broadcast television. And how long before Stern says something he shouldn’t and NBC releases its own statement about how shocked they are that he would say something like that? Doesn’t his hire suggest that is NBC’s expectation? Stay tuned.
EXCLUSIVE: Artie Lange is closing a deal to make his return to radio. Lange is teaming with fellow stand-up comic Nick DiPaolo for The Nick and Artie Show, a sports-themed talk show that will broadcast weeknights from 10 PM-1 AM East Coast time. The plan is to launch October 3, and it will also be taped for broadcast on DirecTV later on. They hope to roll out cross-country, and will start in between 20 and 30 markets. Their deals are worth high six-figures. It’s a three-year commitment and the total value of the deal is in excess of $3 million, I’m told.
Lange returns to the airwaves in regular rotation for the first time since he left under tragic circumstances. Lange replaced Jackie Martling as writer and on-air sidekick to Howard Stern, and his blue-collar sensibility and quick wit made him a popular part of the show. But he also spoke openly about his problems with depression, and vices like substance abuse and gambling, and it was clear these were taking a toll on him as he mixed the early-morning radio gig with weekend stand-up appearances. His Stern run ended when he attempted suicide in 2010. Lange resurfaced slowly on the stand-up comedy circuit, and he comes back to the radio almost two years later, healthy and with his life back on track, I’m told. DiPaolo is a longtime Lange pal — they came up together on the stand-up comedy circuit — and DiPaolo has also done hosting stints on Stern’s Sirius XM Satellite Radio channels. The new show won’t be on Sirius XM; it will be syndicated on terrestrial radio.
In a bizarre development that I can only imagine will be very embarrassing to Sirius XM’s morning man Howard Stern, a bootlegged copy of the JJ Abrams-directed Super 8 has shown up on content-thieving websites. The print is watermarked with the Paramount Pictures logo, and “H Stern” in the right-hand corner. Film companies and networks like HBO routinely personalize advance screeners to safeguard against piracy. There is widespread speculation the leak came from a DVD sent to the show.
I see that already, the Sternfannetwork.com features an “over/under” asking commenters to decide if Stern got $50,000 for posting the film. That is preposterous. Stern receives advance screeners so he can talk knowledgeably about upcoming films he likes, and because he does superb interviews with directors and stars. He will be upset if his show breached a trust with Abrams, a longtime friend who once thrilled Stern’s daughters by putting them on his series Felicity. That is something a dad never forgets. I recall that Stern interviewed Abrams when the director made the rounds to promote Super 8.
UPDATE, 6 AM: Sorry, analysts didn’t ask about Howard Stern — and Sirius XM doesn’t allow reporters to participate in its quarterly calls with The Street. So Mel Karmazin stuck with the themes that have served him reasonably well over the years: Promises of cost cuts and lots of love for Wall Street. He crowed that Sirius XM will end 2011 offering “more channels with less programming expense” than it did last year. He put subscribers on notice to expect an increase early next year in Sirius XM’s $12.95-a-month base rate. And he says that he plans to funnel some of that cash to shareholders. (He doesn’t rule out an acquisition but says “they are hard to come by.”) The company says that by year end it will introduce Sirius XM 2.0: It’s built on a new technology that will accommodate additional channels, program time shifting, and replays. The company’s online service also will offer pause and rewind. At least one auto maker will commit to offering Sirius XM 2.0 radios in 2012. About 65% of all new cars come equipped with a satellite radio, and Karmazin says he plans to step up efforts to have dealers install them in used cars. The company also plans to offer a suite of channels for Hispanic audiences. All told, Karmazin says, “we are growing in a very competitive market and a weak economy.”
PREVIOUS, 4:15 AM: The satellite radio company reported 2Q net profits of $173.3M, up from $15.3M in the same period last year, on revenues of $744.4M, up 6.4%. Earnings at 3 cents a share beat the 1 cent consensus among analysts who follow Sirius XM. But they thought that revenues would reach about $752.6M.
Journalist and attorney Allison Hope Weiner is a special correspondent to Deadline and files this exclusive breaking news:
Now it’s getting personal in Round Two of the legal war between Howard Stern and his satellite radio boss Mel Karmazin according to affidavits filed today by Stern and his longtime agent Don Buchwald, reviewed exclusively by me. Only last January, both Stern and Sirius CEO Mel Karmazin were basking in the glow of Stern’s new contract, with Howard praising how well he’d been treated. But it turns out that, even as Stern was inking the new 5-year pact, the two men were already clashing over Karmazin’s refusal to acknowledge that the company owed Stern additional performance-based stock awards because he exceeded the subscriber targets set in his original agreement with Sirius. Three months later, Stern and Buchwald sued the merged Sirius XM. Now new details keep surfacing about what went wrong between Stern and Karmazin.
In the affidavits, Buchwald reveals that in early 2010, he contacted Sirius about why the performance-based compensation that Sirius then owed Stern for 2008 and 2009 wasn’t paid. “Sirius claimed that no compensation was due,” writes Buchwald. He then had Stern’s lawyer write to Sirius’s General Counsel asking for an explanation. The company again refused to pay. “Sirius’s lawyer claimed that the subscribers on the XM platform did not count toward the total number of Sirius subscribers and pointed out that we had already received the ‘merger bonus’,” writes Buchwald. Finally, during the renegotiation of Stern’s original contract, Buchwald tried again. “I attempted to discuss the performance-based stock awards with Karmazin,” writes Buchwald. “Karmazin, however, refused to discuss any resolution of the matter.”
Buchwald alleges that only when it became clear they weren’t going to “make any progress with Karmazin,” he and Stern decided to bring a lawsuit because Sirius was now trying to renege on the agreement. Buchwald points an accusatory finger at Karmazin in the affidavit. “Sirius’s CEO, Mel Karmazin, was not at Sirius when I negotiated the Agreement with the company. The CEO at the time was Joseph Clayton. Scott Greenstein has told me a number of times that Karmazin is unhappy with the size of the Agreement that was negotiated and agreed to by his predecessor, and that Karmazin has said that if he had been CEO at the time, he would have given Stern much less and not given into our demands. He might have tried to do that, but in this case, as I told Scott Greenstein more than once, Sirius would not have gotten Stern.”
Stern for his part, seems to be taking the lawsuit very personally. “Our Agreement is clear — the stock awards are based upon the total number of subscribers that the company has at the end of any given year,” Howard says in his affidavit. “When we were negotiating the agreement, Don raised with Sirius the possibility that Sirius and XM might combine. Sirius never said that, if that happened, it would not count the new subscribers for purposes of the stock awards.” Stern adds that he fulfilled his role of drastically increasing the subscriber numbers and now deserves to share in the company’s success.
Journalist and attorney Allison Hope Weiner is a special correspondent to Deadline and files this exclusive breaking news:
Throughout Howard Stern’s career, his radio contract often prevented him from saying anything nasty about his frequent boss Mel Karmazin. But the shock jock also had little to complain about: Karmazin helped make Stern a very, very rich man at Infinity Broadcasting, then CBS, then Viacom. After Karmazin became CEO of Sirius, he inherited Stern’s original satellite radio deal. Then Sirius merged with arch-rival XM, and last December Stern opted to re-up. Once again, Howard publicly praised Mel, now CEO of Sirius XM. But behind the scenes relations between Howard and Mel were becoming seriously strained. And only 3 months after entering into that new 5-year pact, Stern and his longtime agent Don Buchwald sued Sirius XM, claiming that the company had failed to pay him performance-based stock awards which he’s owed because he exceeded the subscriber targets set in his original agreement with Sirius. But even then, Howard refused to discuss the lawsuit at length or say anything negative about Mel or even Sirius XM.
But that was then, and this is now.
Today, Karmazin confirmed at the Sirius XM shareholders meeting that the company will file a motion for summary judgment in the Stern lawsuit yet also warned that judges rarely dismiss a case at this stage. But the real surprise, several of my sources with knowledge of the dispute tell me, is that Mel is the driving force behind Sirius XM’s position that Howard is owed no additional compensation. Even more of a shocker, they claim Karmazin was never happy with the original Stern/Sirius- $80 million a year in cash and $20 million in stock to program two channels starting in 2006 as well as bounties if Sirius’ subscriptions passed certain milestones — negotiated before Mel arrived. And, here’s the real stunner from my sources: allegations that Mel didn’t take care of Howard financially as well as the world believes: “Mel Karmazin does a much better job of taking care of Mel Karmazin than most other Sirius shareholders,” accuses one of my sources.
At issue is what happened after Sirius and XM merged in 2008 and the combined company nearly went bankrupt in 2009. As the recession killed new car sales (by far the biggest source of new satellite radio customers), Sirius XM couldn’t meet its hefty debt payments. The company’s stock plummeted to below 6 cents. That’s when Karmazin turned to John Malone’s Liberty Media for a rescue: $530 million in exchange for 15% interest as well as 40% equity in Sirius XM. But after the stock went to 50 cents, Karmazin and a few favored executives received options for approximately 150 million shares at that price. Today, Sirius XM stock is over $2.40. ”This option arrangement was not offered to many other shareholders, including Howard Stern,” one of my sources complains. Add to this some massive “golden parachutes” for Karmazin and others, and Stern feels inadequately compensated for his contribution.
“Howard took the job on the promise that he would have a share in Sirius’ future success,” one source with knowledge of the negotiations explains to me. “He worked hard from the day the deal was signed to insure that success. That was the way the Sirius contract was structured. When Sirius needed Howard, they promised him a share in its success.”
Stern’s complaint claims that, in October 2004, Sirius had fewer than 700,000 subscribers and now the combined Sirius XM has 20 million — and he’s responsible for that number. He also claims Sirius was able to merge with its biggest competitor because of him, and he also helped Sirius XM avoid bankruptcy and he didn’t take his rightful payments.
On yesterday’s show, Stern spoke at length about the lawsuit. “Sirius Radio, by the way, was just about going out of business. I sat down with these guys and I said to them: ‘Look — if I leave terrestrial radio and come to Sirius, I’m gonna bust my balls for you. I’m gonna make shit happen… I guarantee you guys acquire XM radio. Forget merge — that’s a horseshit fucking term — acquire XM Radio… But people have a short memory… And now that times are good and they’ve reached ‘it,’ everybody wants to fucking forget what they owe — and who they owe… There wouldn’t be a Sirius if I wasn’t here.”
A source familiar with the negotiations between Stern and Sirius XM tells me that the satellite radio company negotiated a very generous deal with Stern and that he should be satisfied with the contract he signed only a few months ago. And that both Stern and the company agreed they would discuss Stern’s claims to performance-based stock awards after his new deal was closed. But after that happened, the negotiations went nowhere.
First Howard Stern re-upped his contract with Sirius XM satellite radio for five more years. Now he has agreed to renew his Howard TV, that on demand subscription VOD TV channel, reports MultiChannel News. That means 40 hours per month of uncensored Howard. Yikes.
The Big C executive producer and cancer survivor Jenny Bicks bought a Porsche when she was diagnosed with cancer. “Don’t wait to get cancer to make yourself happy,” she said at the TCA panel for the upcoming Showtime dark comedy series starring Laura Linney as a woman diagnosed with cancer.