TISCH DEFENDS CUTS AT CBS NEWS

In what may have been a preview of his coming testimony in Washington, CBS Inc. President Laurence A. Tisch said Tuesday that he considers public service and integrity--not the bottom line--paramount for CBS News.

Sharply criticized for ordering cost reductions that led to 215 layoffs and a cut of $30 million from the news division’s $300-million budget last month, Tisch said that he had asked the department “to be prudent about its costs. . . .”

However, he emphasized, that doesn’t mean he expects the news division to be a profit center. He vowed to spend any amount necessary “to maintain our standards of quality and to meet any new public-service needs.”

Tisch and his ABC and NBC counterparts--respectively, Thomas Murphy and Robert Wright--are to testify Thursday before a House telecommunications subcommittee probing how management changes and new, cost-conscious executives at the three companies have affected the networks and their news divisions.

Tisch appeared Tuesday at Columbia University here for a Gannett Center for Media Studies conference on the new economics of TV news, and was followed by the heads of all three network news divisions: ABC’s Roone Arledge, CBS’ Howard Stringer and NBC’s Lawrence Grossman.

Tisch, who owns nearly 25% of CBS’ stock and took charge last September after a boardroom battle that resulted in the ouster of Chairman Thomas H. Wyman, told a questioner that what Wall Street thinks of his actions plays no part in his decisions, and that “Wall Street will not interfere” with them.

But in his prepared remarks, he vigorously defended the cost cuts he had ordered at CBS News.

Citing the rapid growth in recent years of cable TV, independent stations and sales of home video recorders, which he called “perhaps the most stunning story,” he said that the “traditional television marketplace has not just changed, it has virtually disappeared, and a far more complex and uncertain economic environment has taken its place.”

When he took over, Tisch said, he sought to cut costs on a company-wide basis to meet challenges from the new competition and to compensate for declining advertising revenues and audience.

Still, said Tisch, a hard-news fan whom many at CBS News praised when he took control of the company, he initially had no intention of cutting the news budget of $300 million for 1987, and in fact approved that amount in December “despite my misgivings about the overall increases in our costs. . . .”

But after further study of the matter, and a trip to CBS bureaus overseas in January with CBS News President Stringer, he changed his mind, he said.

It became “abundantly clear to me,” he said, “that there were significant inefficiencies and redundancies in our news operation. It was apparent that our current level of spending was not necessary to maintain the level of our broadcasts.”

He said that CBS News’ independence remains intact despite his cuts, and asserted that “it is pure fiction that the independence of the news (division) depends on its economic autonomy.”

In a question-and-answer session that followed his speech, Tisch indicated that the high salaries paid CBS correspondents--which would include the $2.5 million that anchorman Dan Rather reportedly earns--are not about to become a thing of the past.

When asked whether, in the new economic climate, CBS could get out of the bidding wars that skyrocketed salaries in the 1970s, Tisch smiled, said “I wish I had the answer,” then said, “We have to pay the salaries to make sure CBS gets more than its share of the best talent in the world.”

The session, which was open to the public, turned poignant when two ex-CBS News correspondents--Marlene Sanders and Steve Young--rose from the audience of about 300 to pose questions.

Sanders, a veteran staffer who opted to leave CBS rather than accept a transfer to its radio news division, asked if the layoffs could have been handled better than what she termed the “sledgehammer” approach that was employed.

Tisch, who seemed somewhat embarrassed in facing Sanders, said that he didn’t know whether it would have been wiser to trim the staff in small numbers or to do it the way it happened, “in one fell swoop.”

“I can’t say we did it the right way,” he said.

When asked later by Young, who was among the 215 fired, if there will be changes in the top management of CBS News, Tisch said he sees “absolutely no change.”

In their appearances later before a packed auditorium, the three network news division chiefs--who will testify in Washington today before the telecommunications, consumer protection and finance subcommittee of the House Energy and Commerce Committee--said cost-cutting is a task that must be tackled, with Grossman asserting that the cost problems have come from within, not primarily from the competition.