The cable industry has produced a lot of characters over the past 25 years. Multichannel News narrowed the list to 25 of the industry’s most influential executives. From pioneers, like Ralph Roberts and Ted Turner, to today’s top players, like Brian Roberts and Geraldine Laybourne. Along the way, there are controversial figures (Michael Eisner) and the disgraced (John Rigas), big guys (Rupert Murdoch) and little guys (Rocco Commisso), and many more. Here, in alphabetical order, are some of the people who created the industry, made cable the force that it is and will lead it into the future. Compiled by senior finance editor Mike Farrell.
The Microsoft co-founder put his money where his mouth was in 1998, buying Marcus Cable for $2.8 billion as the cornerstone of his Wired World strategy. That acquisition was followed by the purchase of Charter for $4.5 billion and led to deals to buy smaller operators. When he was done, Allen had spent about $7 billion of his own money, and Charter had become the No. 3 MSO with over 6 million subscribers. A $3 billion initial public offering came in 1999. But the Charter’s heavy debt load ($19 billion as of June 2005), has sent its stock into a tailspin.
As head of the NCTA, Anstrom was at the helm during one of the lobbying group’s darkest hours — the pending re-regulation of cable by the federal government. But through a series of moves, including rallying the industry to improve customer service, Anstrom was able to push back the specter of re-regulation and usher in the Telecom Act of 1996, which deregulated cable and paved the way for a new round of investment. Anstrom left the NCTA in 1999 to become president of The Weather Channel, ascending to president and COO of its parent Landmark Communications in 2002.
C. Michael Armstrong
Armstrong emerged as the industry’s de facto leader after AT&T’s purchase of TCI in 1999. Armstrong moved to the top spot at AT&T in 1997 bent on returning the phone giant to prominence. But his strategy — securing a line into the customer’s home via cable — proved to be a disaster. AT&T paid $48 billion for TCI, a company that was in dire need of expensive upgrades to its infrastructure. AT&T also focused on the telephone business, neglecting the core video business. That led to increased pressure from Wall Street and AT&T’s decision to sell its cable unit to Comcast in 2002.
When TelePrompter was sold to Westinghouse in 1981, Bresnan became chairman of the new company, called Group W Cable, then one of the largest MSO with 1.5 million subscribers. Bresnan left Group W in 1984, creating Bresnan Communications and growing it to 690,000 subscribers in the Northwest and Midwest, built on a reputation of providing advanced services to secondary markets. When he sold Bresnan to Charter in 1999 for $3.1 billion, Bresnan left the industry for a few years. But the cable bug bit again in 2002, when he purchased 315,000 subscribers from Comcast in Montana, Wyoming, Colorado and Utah.
The wunderkind who helped create America Online, Case was a chief proponent of the convergence of new and old media. While he grew AOL into the dominant ISP by 2000, his greatest move was perhaps acquiring Time Warner. Though AOL touted the synergies between its online properties and Time Warner’s publishing, broadcast and cable assets, they never materialized. And Time Warner, which initially valued the AOL deal at $140 billion, took a $99 billion write-down in 2002, mainly because of the over-inflated goodwill valuation of AOL. Case stepped down as chairman in 2003. Earlier this year, he purchased Wisdom Television, renaming it Lime.
Although he heads up a small-market operator — Mediacom Communications has about 1.4 million customers — Commisso threw down the gauntlet with ESPN in 2003, formally requesting permission from the FCC to place expensive programming networks on a separate tier. While he didn’t quite get there, Commisso set the stage for Jim Robbins’s public battle with ESPN, which led to manageable rate increases for the rest of the industry.
Daniels created one of the early MSOs, buying a system in Casper, Wyo., in 1952. He branched out to the cable broker business, founding Daniels & Associates in 1958. Daniels sold most of his systems in the 1960s, and made forays into programming — launching Prime Ticket Network, an early regional sports network, with Los Angeles Lakers owner Jerry Buss in 1985. He sold Prime Ticket in 1994 for $130 million, distributing $12 million of those proceeds to employees. Daniels also donated millions of dollars to hundreds of causes. He died in 2000 after a long illness, at the age of 79.
Dolan got his start securing the cable franchise for Manhattan, building the first system in a major metropolitan area. To lure customers, Dolan launched movie channel HBO, the most successful pay TV channel in history. Although he lost the Manhattan system and HBO to Time Inc. in 1973, Dolan emerged with enough money to buy a few thousand subscribers in Long Island, N.Y. He turned that into Cablevision, which now has 3 million subscribers. Dolan was also a programming pioneer: He created one of the first regional sports networks, MSG Network, and his Rainbow Media Holdings includes AMC, IFC and WE.
Eisner took the helm of Disney in 1985 and grew the foundering animation giant into a powerhouse entertainment company. His purchase of Cap Cities/ABC in 1995 gave Disney control of ESPN, which has become one of the strongest brand names in history. When Disney’s stock price began to plummet in 2004, a group of investors called for Eisner’s removal. The pressure intensified that April at Disney’s annual meeting, when Eisner agreed to relinquish the role of chairman while remaining CEO. He later agreed to retire in September 2005, and in June, Eisner hand-picked Disney president Robert Iger as his successor.
Despite being the No. 2 DBS provider, EchoStar has always played the role of outsider, in part because of Tennessee-born chairman Ergen. While DirecTV went after high-end customers with exclusive programming packages like “NFL Sunday Ticket,” Ergen pursued the price-conscious consumer, offering packages of 40 channels for $19.99 per month. In 2001, when DirecTV parent GM put the DBS giant up for sale, Ergen made an offer later valued at $20 billion. The deal, which would have created an 18.5 million-subscriber juggernaut, scared a competition-minded FCC, which nixed the deal in 2002, paving the way for News Corp.’s 2003 DirecTV purchase.
A Hughes Aircraft engineer, Hartenstein and eight other employees of the defense contractor realized the potential of satellite television in 1990. Hartenstein became the CEO of the fledgling operation, which later became DirecTV, that year and launched his first satellite in 1993. From those humble beginnings, DirecTV grew into a powerhouse, capitalizing on its superior picture quality to cable (which forced MSOs to invest in upgrading their systems), eventually growing to 14.4 million subscribers. Hartenstein retired in 2004, a year after DirecTV was purchased by News Corp.
Leo J. Hindery Jr.
Although Hindery had been in the industry for years as head of InterMedia Partners, he made his mark on cable in 1997 when he became president of TCI. Hindery, charged to shore up the MSO’s flagging operations, began selling off disparate systems and cutting partnership deals. His concept of the “super-cluster” — consolidating operations into regional pockets to take advantage of cost efficiencies — wasn’t new, but other operators began to follow suit. When his self-dubbed “Summer of Love” was over in 1998, TCI had pared down to 11 million subscribers and caught the eye of AT&T, which purchased TCI for $48 billion in 1999.
Former Continental Cablevision CEO Hostetter re-entered the spotlight in 1999 when, as a major shareholder of MediaOne Group stock, he blocked Comcast’s bid for the MSO, citing displeasure with the deal’s voting structure. Hostetter helped bring in AT&T Broadband, which purchased MediaOne in 2000. He tried to play spoiler again in 2001, when Comcast made a bid for AT&T Broadband, again over the voting structure — Hostetter wanted the Roberts family to either reduce its voting stake in AT&T or acquire a greater percentage of its common stock. The two reached a compromise — instead of a 49% combined stake the Robertses agreed to a 33% combined interest in AT&T.
Johnson, a former lobbyist for the NCTA, created BET, the nation’s first cable network targeted at African-Americans, in 1980 after receiving a $500,000 investment from Liberty Media. In 1991, he took BET public (becoming the first African-American CEO of a NYSE-traded company) and took it private again in 1998. He sold BET to Viacom in 2000 for $3 billion, remaining as chairman and CEO. Johnson became the first African-American majority owner of a major-league sports team in 2002 when he acquired the rights to an NBA expansion team, the Charlotte Bobcats. He stepped down as CEO of BET in 2005.
She had already cemented her reputation in the industry as the guiding force behind children’s cable network Nickelodeon (the highest-rated channel on cable) when Geraldine Laybourne chucked it all to start women’s network Oxygen in 2000, backed by such well-known names as Oprah Winfrey and Paul Allen. After a rocky start, Oxygen now has carriage in all the major MSOs and distribution to about 54 million homes. Laybourne has also been a driving force in promoting diversity and women in the workplace.
Levin may now be known for one of the biggest merger flops is history — AOL Time Warner — but he was a pioneer almost from the start, coming up with the idea to bounce HBO programming off a satellite for delivery to cable operators. Levin also proved to be a visionary — although considered a failure at the time, Time Warner Cable’s 1994 Orlando, Fla., ITV experiment, the Full Service Network, laid the groundwork for features like VOD. Levin also proved to be a worthy foil to Ted Turner, forcing the latter into a subservient role after Time Warner acquired Turner Broadcasting in 1996.
Malone practically invented the complicated tax-free cable transaction, taking the reins at TCI in 1972 and quickly building it into the largest cable operator in the country in a series of complex partnerships, subsidiaries and joint ventures. He also was a hardball player with government officials — Al Gore once called him “Darth Vader” — and some say his tactics led to the Cable Act of 1992, which froze cable rates and hamstrung operators for years. Through Liberty Media, Malone also recognized early the value of content — he was an early investor in cable channels BET, GSN, Discovery Channel and many others.
Best known as a programmer, Murdoch first struck fear in the hearts of cable operators when he tried to acquire DBS service provider EchoStar. But the so-called “Death Star” wasn’t meant to be — Murdoch backed out of the deal a few months after it was announced in 1997, some say in deference to operators who carried News Corp. networks. Murdoch became a powerful force in cable programming — with Fox News Channel, Fox Sports Net, FX and others — and finally made his move into distribution in 2003 with the $6.6 billion purchase of a controlling interest in the No. 1 satellite provider, DirecTV.
Whether or not he truly coined the phrase “content is king,” Redstone has been a driving force in cable programming for more than 20 years. Since emerging on the media scene in 1987, after his National Amusements purchased Viacom, Redstone has helped develop some of the strongest brands in cable. Although its 1998 merger with CBS Corp. has stumbled — Viacom stock is down 6.5% this year alone — Redstone proposed a split of the company into two separate entities. That deal is expected to be completed by the first quarter of 2006.
Rigas took out a $300 loan to buy his first cable system in 1954. He grew Adelphia to 5.4 million subscribers by 2002, mainly through acquisitions. But a March 2002 conference call proved to be his downfall. When Adelphia disclosed that it was liable for $3 billion in family debt and couldn’t prove that the loan was backed up, it set off a chain reaction that led to the resignations of Rigas and his two sons. Rigas and his son Tim were convicted on 18 counts of fraud and conspiracy and sentenced to 15 years and 20 years respectively.
Robbins joined Cox Communications in 1983, after stints at Viacom and Continental Cablevision and became CEO in 1995. Always an outspoken executive, Robbins was thrust into the national spotlight in 2003, after he declared war on ESPN and its annual 20% rate increase. The fight lasted almost a year, with both sides taking pot shots at the other. But in the end, Cox reached a 10-year deal with ESPN with an average annual rate increase of 7%. That deal set the tone for the rest of the industry, which was able to get similar deals from the sports network.
He may have started as a controller at Comcast’s Trenton, N.J., system in 1981, but Roberts soon made an impact on cable. After being named Comcast president in 1990, he challenged Microsoft co-founder Bill Gates to buy cable stocks. Gates purchased $1 billion of Comcast stock in 1997, starting a three-year run-up in cable stocks across the board. Roberts and his team became a force to be reckoned with at the deal table. A flurry of acquisitions — starting with Jones Intercable and ending with the $54 billion purchase of AT&T Broadband — made Comcast the No. 1 MSO with 21.5 million subscribers.
He may be known more today as Brian’s dad, but former Comcast chairman Ralph Roberts is one of the few remaining cable pioneers left. Roberts saw the potential of the nascent cable industry in 1963, buying his first system in Tupelo, Miss. He grew Comcast to be the fifth-largest MSO in the country, with 2 million subscribers by the time he handed the reins to Brian in 1990. At 84, Ralph is primarily retired, but he is still a trusted confidant of his son’s — Ralph’s office is located next to Brian’s. And Brian says he seeks his father’s counsel on every deal.
Turner was one of cable’s true pioneers, launching the 24-hour CNN in 1980 amid much skepticism. He followed that with TBS, TNT, Cartoon Network and TCM. Although he was stripped of most of his power after he sold Turner Broadcasting to Time Warner in 1996, Turner continued to have a hand in programming operations until the ill-fated Time Warner-AOL merger. Although Turner signed off on the deal, he lost between $7 billion and $8 billion on paper, as AOL’s stock price plunged. He officially left Time Warner’s board in 2003 to devote more time to philanthropic pursuits.
Willner took the high-road shortly after accounting scandals at Adelphia and Charter shook investor confidence in cable, adopting reporting standards for the industry while chairman of the NCTA in 2001-2003. Willner, CEO of Insight, helped formalize standards for subscriber counts, cash flow reporting and revenue reporting that many operators adopted on a volunteer basis.