Are Tinseltown Titans Worth Top Pay?

The future may be cloudier than ever for entertainment titans as their world is rocked by a series of technology-driven mergers and acquisitions. But at least they’ll never go hungry.

Compensation expert Graef (Bud) Crystal reports in his latest annual survey that entertainment CEOs continue to out-earn their counterparts in other industries. While no one ever said corporate life is fair, Crystal contends that the median-level entertainment executive makes $2.6 million more a year than they deserve, based on company size and performance.

Topping this year’s entertainment list, surprisingly, is Viacom Inc. Chief Executive Frank J. Biondi Jr. Crystal’s report says Biondi received about $16.5 million for the fiscal year in salary and stock options.

Biondi’s payment was a onetime spike, according to Crystal. The compensation analyst said about $10 million of the total package came after Viacom’s board allowed Biondi to accelerate payment on a stock incentive plan in anticipation of higher tax bills under President Clinton.

Last in the entertainment sweepstakes is another CEO who was briefly in the running for Paramount. Crystal’s report shows that cable mogul Ted Turner received only $1.1 million. But Crystal also points out that company owners usually keep most of their money tied up in stock.

Crystal’s findings are drawn from a survey of the 200 largest publicly held U.S. companies--which means that foreign-owned firms such as Sony Pictures and MCA Inc. are excluded. Other well-known entertainment companies--such as General Electric-owned NBC--also are unaccounted for because they are part of larger corporate entities.

Topping the overall list this year is Primerica Corp. Chief Sanford I. Weill, whose compensation came to $50.6 million. Lowest paid is billionaire Warren Buffett, at a near-invisible $100,000.

Biondi is the only entertainment executive in Crystal’s Top 10. Others who made the full list: Walt Disney Co. Chairman Michel D. Eisner, at $7.4 million; Tele-Communications Inc.’s John C. Malone, $7 million; Capital Cities/ABC’s Daniel B. Burke, $5.6 million; Paramount Communications Inc.’s Martin S. Davis, $4.5 million, and CBS’ Laurence A. Tisch, $2.2 million.

On a performance level, Crystal says, everyone but Turner is overpaid. Viacom’s Biondi made $11.5 million more than he deserved, according to Crystal’s chart. Malone--just named Entertainment Weekly’s most powerful man in Hollywood after selling TCI to Bell Atlantic--gets an easier ride. Crystal says he had all but $782,000 of his $7-million salary coming.

While Levin wasn’t on the job long enough to make the list, Crystal estimated his earnings at just under $4 million.

“By Time Warner standards, that’s poverty,” said Crystal, alluding to the big paydays enjoyed by Levin’s predecessor, the late Steven J. Ross. “When you look at it, your first reaction is that it must be a typo. Your second is you want to book a Carnegie Hall benefit for Levin.”

Crystal has a lot of experience analyzing entertainment pay. He used to do a secret study for the industry so that executives could gauge typical salaries for various positions without knowing what specific people made. He says little has changed.

“If you ask these people about what they make, they’ll say, ‘If you think I make a lot of money, look at what Sydney Pollack makes to direct a picture, or what Redford gets or what Madonna gets,’ even though they are doing the negotiating for the company,” Crystal said.

“They argue that it takes much more genius to extract a dollar of profit in entertainment than it does in a utility,” he added. “They’ve always been highly paid. There’s a ratcheting up of pay because of what they pay the talent.”

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Short and Sweet: Based on this weekend’s box office success of Tim Burton’s “The Nightmare Before Christmas,” Walt Disney Studios may want to make all of its films shorter. “Nightmare,” which clocks in at 75 minutes, took in $6.2 million from just 563 screens.

The stop-action animation movie had a lot of momentum going in, due to Burton’s wide following and critics’ raves. But Disney also benefited from “Nightmare’s “ truncated length. At 75 minutes, theaters were able to offer up as many as seven showings a day, compared to four or five showings for a traditional 90-minute to two-hour film.

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Night and the City: When MCA opened Universal CityWalk earlier this year--with cloned versions of local landmarks such as Jody Maroni’s Sausage Kingdom--critics called it a sanitized environment. But the gap between fantasy and reality has narrowed, on weekend nights at least.

The CityWalk experience begins with a real live traffic jam leading up to Universal City. You then pay a big-city parking fee of $5 before descending into a remarkable re-creation of an L.A. mob scene. The sheer density of the crowd recalls the Venice boardwalk. The upscale demographic mix of teen-agers, tourists and young couples is pure Westwood, circa 1985. The hermetically sealed environment is present-day Santa Monica Third Street, minus the homeless.

After you push your way through the thicket, the harsh-reality-of-urban-life thrill ride climaxes as you’re told there’s a 45-minute wait for a restaurant table. Outrage strikes, much as in everyday life. Then you relax and just go with it, marveling at the marketing genius of the folks in MCA’s black tower and cognizant that you are in L.A., after all.