CBS Chairman Laurence Tisch is taking responsibility for the big-ticket baseball deal that helped push CBS into the red in late 1990.
"I made that decision," Tisch told stockholders Wednesday at CBS' annual meeting. "This company will survive that decision - on a profitable basis."CBS agreed to pay $1.06 billion over four years, starting in 1990, for coverage of major league baseball, including the World Series.
"In the long run, maybe it was a mistake, but it wasn't a disaster," said Tisch.
In 1990, CBS had income of $91.5 million from continuing operations, or $3.55 a share, compared with $297.1 million, or $11.54 per share, in 1989.
"This decline in earnings was mainly the result of the company's reported loss of $6.81 per share in 1990's fourth quarter, which included an after-tax loss of $55 million (from) coverage of major league baseball," he said.
In addition, CBS provided for future losses of $115 million over the remaining term of the contract, he said.
"We entered the baseball contract on the premise that we would lose money," Tisch told stockholders.
Baseball is part of a $3.5 billion sports package CBS launched in 1990. The network paid $1.06 billion for four years of pro football, including the 1992 Super Bowl, and $1 billion over seven years to cover NCAA basketball.
CBS also expects to post a loss for 1991, and last month announced plans to cut costs by $100 million, mostly by eliminating 400 jobs among its 6,650 employees.