Richard D. Parsons, a long-time boss, who, less than a month ago, was named interim chairman of CBS to stabilize the company, said Sunday he went down due to illness.
Committed to Transforming CBS Corporation has been appointed as its replacing Strauss Zelnick, director of video game publisher Take-Two Interactive Software. Mr. Zelnick, widely respected in the media industry, was appointed to the CBS Board in early September. He had directed the music publisher BMG Entertainment and had served as president of the 1900s Fox.
Shake-up complicates an already difficult time for CBS, who spent most of the year on multi-frontal combat. Several allegations of sexual abuse were made against Leslie Moonves, chief executive officer, as well as a prolonged leader of his news sharing. Separately, a questionable legal settlement with the controlling shareholder threatened to maintain the company's management.
When CBS worked to resolve disputes, Mr. Parson was instrumental in negotiating Mr. Moonves to travel. He also advised to appoint Joseph Ianniello, Chief Operating Officer, as acting CEO, and helped install six new board members to lead the company out of trouble, according to several people near the board who spoke on condition of anonymity. The lawsuit was dissolved as part of Mr. Moonve's starting agreement.
Several years ago, Mr. Parsons was found to have a rare form of blood cancer known as multiple myeloma. His illness was imitated after he underwent a stem cell transplant. In a statement issued by CBS, he said: "Unfortunately, unexpected complications have created further new challenges, and my doctors have advised to cut my current obligations is crucial to my overall recovery."
Herr. Parsons has a reputation as a credible dealmaker, one who could settle in the most accident of disputes. He untangled what is considered one of the worst mergers in corporate history, AOL-Time Warner, and he helped stabilize Citigroup after the 2008 recession. In 2014, he was called to help rehabilitate Los Angeles Clippers from the National Basketball Association.
Under Mr. Parson's leadership, the Revolutionary CBS Board had already started the search for a CEO when it evaluated who could best help the company navigate, which has become a tough landscape for the media industry. Silicon Valley continues to steal ad dollars and eyeballs from traditional television stores, and entertainment companies have had to find new ways to maintain relevance with younger audiences.
In the case of CBS, CBS All Access, which has over 2.5 million paying subscribers, has recorded gains and is currently pace to hit four million next year, according to the company. The premium cable network Showtime, part of CBS, has also made advances in streaming and expects to register an equivalent number of customers in the same period. Together, they have streaming businesses over $ 500 million in annual revenue, a business line that did not exist just a few years ago.
Herr. Ianniello, who is the candidate to become permanent CEO, has already made several key appointments in the two months he has been at work.
He appointed David Nevins, CEO of Showtime, to retrieve all programming as chief creative officer, a newly created role. He also appointed a chief financial director, a new head of human resources and a chief communications manager.
The board is still awaiting the outcome of an investigation of allegations of sexual harassment against Mr. Moonves and Jeff Fager, the head of CBS 'most lucrative news program, "60 minutes" and a former head of his news sharing. Both have denied the allegations.
The CBS Board employed Nancy Kestenbaum of Covington & Burling and Mary Jo White of Debevoise & Plimpton to conduct their internal investigation of the charges and the general culture of the company.
Ms. White led the Securities and Exchange Commission under the Obama administration and was former US lawyer for the Southern District of New York. Mrs. Kestenbaum was also a federal prosecutor in the same district.