ROSENBERG'S CONTRACT NOT RENEWED

DAN ALAIMO

LOS ANGELES -- The Video Software Dealers Association's board has decided not to renew the employment contract of its high-profile executive vice president Don Rosenberg in an apparent conflict over "management style."

In a surprise announcement in late December VSDA said it would establish a search committee to find a successor to Rosenberg, whose contract runs until Sept. 30, 1994. It was not clear how long Rosenberg would stay on the job.

VSDA is the leading trade group for video retailers and its July convention is the only significant national video show. The show is attended by many supermarket video executives representing large chains.

VSDA, which has a membership base dominated by video specialty retailers, made a concerted effort to attract more supermarkets and other classes of trade during Rosenberg's tenure. There will be no change in VSDA's direction on this, because it is a policy set by the board, said sources close to the situation.

Rosenberg, who has been executive vice president since July 1, 1991, was not available for comment. Other VSDA executives said they had no comment beyond the association's press release, which was a tersely worded description of the bare details of the situation. The release briefly expressed the board's appreciation for Rosenberg's contributions "to the association and to the industry."

In its 13-year history, VSDA has had three executives and one interim executive.

In his short time at the helm of VSDA, Rosenberg had become a well-known and respected voice for the video industry. He was closely identified with issues such as the proposed in-home delivery systems and low-priced video promotions with fast-food companies.

The accomplishments of VSDA under his leadership included expanding the board to include a more diverse retail and supplier membership and moving the association's offices to the Los Angeles area where they are closer to the studios. VSDA also is reportedly doing much better financially than it has in the past.

Disappointments during Rosenberg's tenure included the length of time it took VSDA to issue its pay-per-view study and the group's failed attempts to launch a national marketing campaign. But these had little to do with the board's decision not to retain Rosenberg, according to sources.

A source close to a board member said a number of conflicts over management style forced the decision. "No single issue was decisive, but the cumulative weight of all of them caused the board to decide not to renew the contract," the source said.

"The board members wished that things could have turned out otherwise, but they felt that they did what they had to do given the facts of the situation," said the source.

Another industry source agreed that the primary issue was that of management. While Rosenberg excelled in public, supplier and government relations, the board had concerns about his style of management, said the source.

No one contacted by SN would cite specifics.

But some said the problem has its roots in a personality clash between Rosenberg and certain board members. "It just seems to be a personality conflict -- a political putsch," said an industry source.

"There were certain members of the board of directors who felt the need to micro-manage the organization when Don and his staff had been hired to do that," the source said.

"There are board members who feel that their own personal agendas are exceedingly more important than the goals of the trade association," said Gary Messenger, president of North American Video, Durham, N.C. Messenger is a specialty retailer who served six years on VSDA's board and remains a well-connected industry figure.

"It's a simple clash that happens in lots of groups," he said.

Excessive demands were placed on Rosenberg by the board and the conflict arose when he did not respond to some board members' satisfaction, said Messenger. "If you have a personal agenda, you are going to clash with anyone in Mr. Rosenberg's position," he said.

Messenger did not elaborate on what that personal agenda was, except to say that certain board members wanted to be closely involved in the everyday operations of the association. "What we are looking at is individuals who think they can not only run their own companies, but also have enough spare time to run a trade association," he said.

Rosenberg gave VSDA the respectability it enjoys today, he said. "He basically straightened our tie and dusted off our shoes. There was a point just before he took over when many in the industry were not very happy with the direction the association was headed in," Messenger said.

"I am incensed by what has happened here. This is the most incredibly ludicrous act of ego enforcement that I have seen in many, many years," he said.

In response to some of the criticisms, VSDA president Dawn Wiener noted, "there's always two sides to a story." But because this is a sensitive employment situation, "it just can't be spoken about at this time," she said.

In matters like these, "people don't always see what is going on on the inside," she said. Besides her VSDA duties, Wiener is president of two specialty retail chains in Austin, Texas, Discount Entertainment and Home Video Plus.