Albrecht through at HBO
Steps down 'with great regret' in wake of arrestChris Albrecht is stepping down as chairman and CEO of HBO, parent company Time Warner said Wednesday, in the wake of the highly publicized arrest that has ended his 22-year career at the network.
"With great regret, at the request of Time Warner I have agreed to step down as chairman and CEO of HBO," Albrecht said in a statement issued by TW. "I take this step for the benefit of my HBO colleagues, recognizing that I cannot allow my personal circumstances to distract them from the business."
HBO COO Bill Nelson will take over Albrecht's duties on an interim basis.
Albrecht's departure came a day after he disclosed in an internal memo that he would take a temporary leave from the company in order to seek treatment with Alcoholics Anonymous. The memo suggested alcohol might have played a part in an incident Sunday morning in Las Vegas in which he was arrested on misdemeanor charges because of an alleged fight with his girlfriend outside the MGM Grand casino.
HBO insiders say Albrecht had been regarded as a ticking time bomb in recent months as his struggle with alcohol became more visible within the company. "He wouldn't drink heavily around anybody, just a glass of wine here or there," a source said. "But you could tell something was not right with him."
Sources say TW had become increasingly concerned about the distraction Albrecht's PR nightmare was causing, especially after a Los Angeles Times report Wednesday citing allegations that in 1991 Albrecht had been involved in a physical altercation with a female employee at HBO, which was forced to pay a $400,000 settlement.
On Tuesday, TW chairman Richard Parsons said the company would "monitor this situation closely." On Wednesday, he changed sentiments.
"(TW president and COO) Jeff Bewkes and I believe that this is the right decision for the company," Parsons said. "We thank Chris for all of his contributions to HBO over the years."
A TW spokesman declined comment on any potential severance payments to Albrecht and said it was too early to say whether the company will look for a replacement internally or externally. A source said Albrecht's contract was set to expire in six months.
Already, a guessing game is afoot as to who will be Albrecht's permanent successor. Insiders say HBO will likely revert to the management structure in place before Albrecht assumed CEO duties. TW is expected to select a CEO who will stick strictly to the financial side of the business, and there is no shortage of internal possibilities to fill that role, including Nelson; executive vp Richard Plepler; Harold Akselrad, general counsel and executive vp legal, business affairs and film programming; and Eric Kessler, president of sales, marketing and business development.
Meanwhile, a chief programmer likely will be installed, with HBO Films president Colin Callender and HBO Entertainment president Carolyn Strauss the strongest candidates. Both have Rolodexes stocked with A-list talent and a creative style that earns Emmys.
Rarely does an executive that high in a corporate structure fall out without taking some of the people he put in with him. Insiders are wondering who will follow Albrecht out the door.
Others are hoping that HBO shakes up its ranks of longtime execs with new blood capable of taking a fresh look at its business. While Albrecht's departure will invite new questions about HBO's viability, insiders had already been asking those questions ever since creative and financial oversight was consolidated under Albrecht, who is said to have strayed from his core competency as a creative dynamo.
Albrecht has been credited for engineering a stellar run of critically acclaimed, popular original programs, including "The Sopranos," "Sex and the City" and "Six Feet Under." The hits made HBO a dominant force at the Emmys going back to the 1990s and fueled HBO's robust audience base of more than 28 million subscribers.
But critics have carped in recent years that HBO was beginning to lose its magic touch. HBO's biggest hit of all, "The Sopranos," is scheduled to end its run next month, and a fleet of untested new series will arrive in its wake. In addition, HBO has only taken tentative steps in the digital arena transforming the media business, a challenge Albrecht had declared a top priority.
Oppenheimer & Co. analyst Thomas Eagan said Albrecht's departure "is certainly a loss as Chris was a real creative force at HBO, but he is surrounded by creative executives … as well as a rich historical commitment to original programming."
"HBO is arguably the most profitable network of all, and so it's crucial for Time Warner," Barrington Research analyst James Goss said, adding that the executive loss also happens at a key time as HBO is losing "Sopranos" and looking for future hits.
However, Goss said that "between having Jeff Bewkes and the (management) bench strength I think they have at HBO, while it's unfortunate for Chris Albrecht, I feel comfortable" that the network will be fine.
Albrecht joined HBO in 1985 as senior vp original programming, West Coast. In 1990, he moved on to HBO Independent Prods., where he oversaw hit series produced for other networks, including "Everybody Loves Raymond" for CBS and "Martin" for Fox. Five years later, he was at the helm of HBO's original programming efforts, which reinvented the company's business by switching emphasis from theatrical reruns to original series including "The Larry Sanders Show" and "Oz."
Andrew Wallenstein reported from Los Angeles; Georg Szalai reported from New York.