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Dick Clark in Tune with America’s Tastes

Dec 13, 2004  •  Post A Comment

Two hours before the 2000 Golden Globes telecast from the Beverly Hilton Hotel, Richard Wagstaff “Dick” Clark was walking the press line in front, where limos were just beginning to disgorge celebrities. He stopped when he noticed some of the TV lights used for a wide shot of the arrival area were not placed properly. In moments, he had a crew of technicians fixing the problem.

As he had done for more than four decades, Mr. Clark was attending to every detail. That is how he grew a large, active business, Dick Clark Productions, while also building his on-air career.

Mr. Clark was once asked how he stayed current with all the changes in music. He said he viewed himself as a storekeeper. His job was not to reflect his personal choices but rather to monitor his audience’s tastes and fill his “shelves” with what they wanted at the time.

His public image for years has been that of “America’s oldest living teenager,” a title first coined by TV Guide. Last week, Mr. Clark suffered what is described as a minor stroke. His spokesman said he is expected to make a full recovery. Still, coming only months after Mr. Clark revealed that he has suffered in recent years from Type 2 diabetes, it seemed to be a symbol that at age 75, even Dick Clark is mortal.

Whether he will be able to return in time to host the big party from Times Square on New Year’s Eve for ABC or to produce the Golden Globes in January on NBC remains unclear. However, his company will still be on the job, fulfilling long-term commitments to those and many other franchise properties it controls, including the Country Music Awards, Daytime Emmy Awards and the American Music Awards.

Mr. Clark formed his own company in 1957 and survived a record payola scandal two years later. When he took the company public, he retained about 90 percent of voting power. While TV production represented roughly three-quarters of revenues (which were about $67 million in 2002), there were also initiatives into music, corporate events, licensing, restaurants and other ventures.

By 2001, however, there was concern about the impact of industry changes. “Increasing consolidation in the entertainment industry has resulted in many of the Company’s traditional customers (such as the television networks) merging with its competitors who provide entertainment production services similar to those provided by the Company,” DCP stated in a Sept. 2001 SEC filing.

After considering a number of suitors, Mr. Clark sold control in late 2002 for $14.50 per share, or about $136 million. His take (with his third wife) was estimated at $50 million. As part of the deal, Mr. Clark kept 10 percent of the company and signed a new employment agreement as chairman. His deal included a base salary of $975,000 per year (with annual raises), plus bonuses. In addition, he was paid for on-air work, which in fiscal 2001 amounted to about $1.2 million.

Mr. Clark’s new bosses were Mosaic Media Group, with about 38 percent; Capital Communications CDPQ (a division of a Canadian pension fund), with about 34 percent; and other investors, including former Viacom, King World and MGM executive Jules Haimovitz, who personally held about 3 percent.

Mosaic had been formed in 1999 by business consultant Allen Shapiro, who became head of the merged firm that consisted of film and music company Atlas Entertainment, run by Chuck Roven (and including Atlas/Third Rail management); along with talent managers The Gold/Miller Co., run by Eric Gold and Jimmy Miller, with a client list that included Jim Carrey, Will Ferrell and Tea Leoni. Mosaic produced last Christmas’ hit movie “Elf” and last summer’s “Scooby-Doo.” Atlas has produced such films as “Three Kings,” and is working on a “Batman” sequel.

Mr. Shapiro and Mr. Haimovitz joined with Mr. Clark and his longtime associate Francis La Maina to run the newly private company. Despite predictions of doom, the business took off. It expanded production, including a deal to relaunch a new, jazzier version of “American Bandstand,” and to exploit the rich library.

Beginning in the 1950s Mr. Clark kept film and taped recordings of all his shows. That has now become one of the largest collections of musical performance footage available. In recent years it has been licensed by MTV, CNN, ABC, NBC and many others. Several series of TV “Blooper” shows, most hosted by Mr. Clark, have also been syndicated, along with a library of TV movies such as”A Cry for Help: The Tracy Thurman Story.”

There have also been expanded sales of musical CDs and DVDs at retail and through home shopping networks. Current series production includes “American Dreams” on NBC. There are also more aggressive sponsorship and cross-promotion deals tied to the awards shows and other programming.

This past August the Canadian pension fund was bought out by Mandalay Entertainment, run by former Sony Pictures Entertainment chief Peter Guber, who merged his TV interests with those of Mosaic. Mosaic’s management company and Mr. Guber’s interests in sports teams are separate.

Under the reorganization, according to a source, Mandalay became the largest single shareholder in privately held DCP, which now is said to have revenues exceeding $100 million annually. Even better for the investors, the company has high profit margins and kicks off a very healthy cash flow.

Recently, according to sources, other would-be investors have been knocking on DCP’s door, including cable system operators, cable networks and phone companies expanding into video distribution. Mr. Shapiro, who speaks for DCP, did not return a call seeking comment.

Everyone hopes Mr. Clark will live a long time, but it is clear his company will go on with or without him. Sources say the new management is actively trying to recruit a top-flight creative exec to lead the company in the future.

Mr. Clark would certainly understand. A good shopkeeper not only seeks out the latest merchandise but also brings in a new generation to keep the business in touch with its audience. Whatever happens, Mr. Clark has created a legacy and a company that has the right merchandise for the 21st century and beyond.