Chief of CBS Records Will Curtail Role, Leave Firm in 1992

Walter R. Yetnikoff, the volatile chief executive of CBS Records, will curtail his management role at the label he helped catapult to the top of the music charts.

After running CBS Records for 15 years and engineering its $2-billion sale to Sony Corp. in 1989, Yetnikoff has signed a new multimillion-dollar contract that calls for him to leave in two years and become a consultant to the company. Yetnikoff, who turned 57 last week, is expected to gradually pull out of active management and focus on grooming his replacement, record industry sources say.

A logical successor is Yetnikoff’s protege Tommy Mottola, president of CBS Records’ domestic operations.

Mottola has tried to reduce CBS’ reliance on established superstars and cultivate fresh talent. That strategy has produced popular new acts such as New Kids on the Block, Mariah Carey and Michael Bolton. But record industry sources said that, despite Mottola’s track record, a replacement for Yetnikoff could come from Sony.

“Sony has been less than supportive of Walter in some instances in the past,” said one CBS insider. “Who’s to say they will back Mottola for the job?”

Yetnikoff has been unavailable for comment. But CBS Records spokesman Robert Altshuler said: “Walter’s got a new contract that is improved in all respects. He’s very much pleased with his arrangements.” Altshuler had no other comment.

Several record industry sources said Yetnikoff negotiated his new role at CBS Records and was not forced out. It could not be learned how much CBS will pay Yetnikoff, but sources say he has earned more than $1 million annually as chief executive and will earn at least that much under the new agreement.

Yetnikoff was treated for alcoholism last year and has frequently spoken publicly about his struggle with substance abuse. Since resuming his daily duties at CBS Records, he has reportedly been unhappy at work, and is in the midst of a second divorce.

His relationship with some key CBS artists has also suffered.

A record industry official said Yetnikoff’s relationship with superstar Bruce Springsteen “has totally deteriorated.” (Springsteen’s manager, Jon Landau, did not return a call from The Times to his New York office.)

There is also concern that pop star Michael Jackson, who is renegotiating his contract with CBS, has become disenchanted.

Rival record industry mogul David Geffen, a close adviser to Jackson, is said to be behind Jackson’s recent breakup with his longtime attorney, John Branca, with whom Yetnikoff enjoyed a good working relationship.

Branca and Yetnikoff had opposed a Geffen effort this summer to get Jackson to perform for the movie soundtrack “Days of Thunder.” Shortly after the dispute, Jackson fired Branca and hired new lawyers and advisers.

It was Yetnikoff’s reputation for cultivating strong relationships with artists that helped boost his early music industry career. Yetnikoff, who worked his way though law school at Columbia University, signed acts such as the Rolling Stones after joining CBS Records as an attorney in the early 1960s.

But his frequent tantrums often strained relationships.

One of his most bitter feuds was with Laurence A. Tisch, chairman of Loews Corp., who in 1986 acquired control of CBS Inc. Yetnikoff publicly rebuked the frugal Tisch for trying to rein in spending at the label. The dispute prompted Tisch to authorize Yetnikoff to seek a buyer for CBS Records.

Yetnikoff joined with Sony and became a key force in helping the Japanese company expand its Hollywood presence. He helped persuade Sony to buy Columbia Pictures Entertainment and to hire producers Jon Peters and Peter Guber to manage the enterprise.

Yet Yetnikoff is reportedly disappointed that he’s been blocked from playing a more active role at Columbia. Sony promised to make him chairman of an umbrella committee overseeing records and movies, but it never came to pass.