The CBS-Viacom Merger: A Media Giant Pops Up

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Yet these kindred spirits brought in no-nonsense lawyers. Redstone retained control of the majority of the class-A voting shares, and thus the company. Karmazin can't be fired unless 14 of 18 board members vote against him--and he gets to select eight of them. "I wouldn't have done this deal without keeping [voting] control," says Redstone. Should Redstone step down, or die, in the next three years, Karmazin becomes CEO.

Redstone has said he fully intends to be CEO when Karmazin's current contract expires. "Look, Sumner Redstone is one of the four or five corporate geniuses," says radio icon and longtime Karmazin friend Don Imus. "And Mel is in that class with Rupert, Ted and Eisner. We'll see what sort of relationship they have."

Certainly there are other potential pitfalls for this deal, including considerable regulatory hurdles. Under current law, one company can't own two networks. That might cause Viacom to divest its half-share of the struggling UPN. Turf battles will arise between the bosses who head the various jewels in the Viacom empire, as well as in areas in which there are duplicate functions--the new company has three syndication arms, as well as three prime-time television-show suppliers.

For television viewers, the merger should result in an explosion of cross promotions. Don't be surprised to see plugs for NFL football on MTV or specials about upcoming Paramount pictures airing on CBS. Hollywood producers fret that corporate priorities could distort programming decisions. "This can stifle creativity," says Brad Grey, chairman of management firm Brillstein-Grey and producer of HBO's The Sopranos. "These large companies want to put their own shows on the air first and foremost."

Additionally, there are greater concerns that if too much media power aggregates in just a few companies, it will become harder for the myriad voices necessary in a democracy to find outlets. "I get very nervous when more and more control moves into fewer and fewer hands," warns Senator Mike DeWine, an Ohio Republican and chairman of the Subcommittee on Antitrust, Business Rights and Competition. "This is not a mere commodity we're talking about. It's something more fundamental--information in a democracy."

Karmazin has no problem with the free flow of information in a democracy. In fact, he's all for a diversity of voices: CBS has long owned competing news-radio stations in the same markets. But in the modern American media world--Viacom's world--the free flow of information had better be accompanied by the free flow of cash.

--With reporting by Sally B. Donnelly/Washington, Julie Rawe and David E. Thigpen/New York and Jeffrey Ressner/Los Angeles