Spreading The Wealth

Cable Moguls, Getting Older, Give Away Self-Made Fortunes
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In 1997, as he was named Man of the Year by the United Nations, the ever-unpredictable Ted Turner stunned the crowd when he pledged to give the organization $1 billion.

The Turner Broadcasting System founder had spent his entire adult career building a cable-TV empire, and though his family foundation gave to environmental and sustainability groups, his pledge to the U.N. made headlines as much for its largess as the ease with which it was offered up.

“I don’t measure my success in numbers, but I consider my contributions of over $1.3 billion to various causes over the years to be one of my proudest accomplishments and the best investment I’ve ever made,” Turner said in his letter to The Giving Pledge, an organization dedicated to urging billionaires around the world to donate at least half of their wealth to non-profits and charities. “Looking back, if I had my life to live over, there are things I would do differently, but the one thing I would not change is my charitable giving.”

Turner, who challenged other wealthy executives to jump on the benevolent bandwagon, is not the only cable guy to give away a billion dollars. Upon his death in 2000, pioneering industry investment banker and systems broker Bill Daniels — who made and lost millions over the course of his career and was always generous with his money when he had it — left his foundation, the Daniels Fund, with $1 billion. Gerry Lenfest sold his MSO, Lenfest Communications, to Comcast in 2000 for $1.2 billion, and he and his wife, Marguerite, have already given over $1 billion away to a variety of causes, including colleges and universities and Philadelphia-area cultural institutions.

Over the last 50 years, the cable industry has produced scores of millionaires and billionaires. The growth and popularity of the sector — among financiers and consumers — created an environment in which small investments often turned into pots of gold for all kinds of people, including secretaries. Unlike the great philanthropists of the 19th century — The Carnegies (steel), Rockefellers (oil) and the Vanderbilts (shipping and railroads) — where a few people dominated the landscapes in which they plowed their fortunes, the cable industry was almost egalitarian in that just about anyone with gumption, risk aversion and a little bit of money could start and build a cable company.

Many of the industry’s leading titans — and philanthropists — came from modest beginnings. Several are first-generation citizens who formed their first companies on a shoestring. Alan Gerry borrowed $20,000 to buy a community antenna TV service in his hometown of Liberty, N.Y. in 1956 and grew that company into what would become Cablevision Industries, eventually agreeing to sell it for $1.2 billion to Time Warner Cable in 1995.

John Sie emigrated to the U.S. from war-torn China when he was 14. He spoke no English and was put into an orphanage while his family got settled in a new country. He would go on to be involved in some of cable’s biggest successes including Jerrold Electronics, Showtime and Tele-Communications Inc. and was the architect behind pay services Starz and Encore. Bill Bresnan’s dad died of tuberculosis when he was 5 years old and his mom made ends meet by working as a seamstress. At 12, he was fixing neighbors’ radios to bring in a little extra cash. He eventually went on to create Bresnan Communications and was an influential and charitable leader in the industry until his death in 2009.

Glenn Jones was sleeping in his Volkswagen Beetle in 1967 when he borrowed $400 against his lodgings at the time and bought the cable system in Georgetown, Colo. He would go on to create Jones Intercable and Jones University, making millions along the way.

Most of the executives who donate to non-profits and schools feel strongly about the causes they represent. Sie and his wife, Anna, started the Anna and John J. Sie Foundation to fund research for Down Syndrome; their granddaughter was born with the condition. Gerry’s love of his economically struggling hometown of Liberty, N.Y., helped push him to buy Max Yasgur’s farm — the site of the 1969 Woodstock Music & Arts Fair — and turn it into a tourist attraction.

The cable fraternity remains close-knit, Gerry said, and when a pet project or cause arises, they aren’t afraid of going to each other to ask for a lending hand. Former Group W executive Dan Ritchie did it when he was trying to raise money to pump up the University of Denver in the mid-1990s. Gerry Lenfest is doing it now with his quest to build the American Revolution Center in Valley Forge, Pa.

Tax benefits are a major incentive. And as with many cases of philanthropy, ego is at work too — it’s common to see the names of large donors on buildings, schools and programs. Many of the University of Denver’s buildings and amenities bear the names of cable executives who ponied up the money to help build them. The same goes for The Cable Center, where everything from the programs to the exhibits to the meeting rooms and even the bathrooms bear the name of some cable executive that donated money to the museum.

Yale University’s School of Technology and Engineering is named after the father of Liberty Media chairman John Malone, after Malone donated $50 million to the school a few years back. The University of Pennsylvania named its cancer-treatment facility after Comcast founder Ralph Roberts and his son, CEO Brian, after they donated $15 million to the university’s medical center.

Gus Hauser, a former Warner Amex Cable who later founded his own company, Hauser Communications, was the first operator to sell to a telephone company — SBC Communications. For the past almost two decades, Hauser and his wife, Rita, have created non-profit programs that have benefitted schools, including Harvard, other non-profits, museums and cultural events centers.

There is a propensity for retired executives to be more philanthropically active than working executives, but there are some notable exceptions. Facebook founder Mark Zuckerberg, who is all of 29 years old, and his wife, Priscilla Chan, made charitable donations of $498.8 million last year, according to the Chronicle of Philanthropy. Google co-founder Sergey Brin, and his wife, Anne Wojcicki, who are both 40, pledged $222.9 million to charity in 2012.

“So many of the cable industry’s leaders have been so generous over the years in so many ways,” Cable Center CEO Larry Satkowiak said. “I would say their generosity rivals the Fords and the Carnegies — those people who created the great foundations of the past. They have all found things to support that are important to them and that they are passionate about.”

While no organization tracks individual giving on an industry-by-industry basis, the cable industry has arguably created more humanitarians than any other industry . On the next page is a sampling of the industry’s philanthropists and where they are putting their charitable donations.  

MOGULS WITH A CAUSE

Paul Allen, one of the co-founders of Microsoft , was already wealthy when he helped build Charter Communications into one of the largest MSOs. Allen gave away $309.1 million in 2012, primarily to medical research, according to the Chronicle of Philanthropy. The top beneficiary was the Allen Institute for Brain Science with a $300 million pledge. He also gave $8 million to the Experience Music Project museum, which he founded in his hometown of Seattle, and a total of $1.1 million to the Allen Institute for Artificial Intelligence, Ambassadors for Humanity, the Motion Picture & Television Fund and the Robin Hood Relief Fund.

C. Michael Armstrong made a brief albeit big splash in the cable industry in the late 1990s and early 2000s, as CEO of AT&T when it bought then-top MSO Tele-Communications Inc. He currently serves as chairman of Johns Hopkins Medicine’s Board of Trustees and has given $38 million to Hopkins to date. In 2011, he donated $10 million to establish and name the Institute for Patient Safety and Quality. In 2010, he and his wife, Anne, gave Miami University in Oxford, Ohio $15 million to construct a new student center.

New York Mayor Michael Bloomberg has vowed to give away all the money he has made since forming financial-services firm Bloomberg L.P. Earlier this year, he donated $350 million to his alma mater, Johns Hopkins University — the largest gift in the school’s history, according to The New York Times, which reported in March that Bloomberg’s total charitable contributions to the school have topped $1.1 billion over the past four decades. Bloomberg Philanthropies donated $350 million to various causes last year, according to the Chronicle of Philanthropy.

Upon his death in 2000, Bill Daniels, known as the father of the cable industry, gave his Daniels Fund $1 billion. The grants program primarily supports nonprofit organizations in the West. In 2010, the fund surpassed $377.3 million in cumulative grants and scholarships awarded since 2000. Before he died, Daniels gave money — oft en anonymously — to various groups. In 1987, Daniels created the Young Americans Bank to teach kids how to invest, save and learn about finances. After he noticed a lack of etiquette among interviewees at his brokerage firm Daniels & Associates, he started the Daniels School of Business MBA program.

The Motion Picture & Television Fund received a grant of $30 million from the Diller-von Furstenberg Family Foundation to provide health services and other support to entertainment industry workers in 2012. Former USA Networks chairman and CEO Barry Diller is now chairman of IAC/InterActive Corp.; his partner, Diane von Furstenberg, is a fashion designer. The duo also donated $1 million to Cedars-Sinai Medical Center in Los Angeles for the hospital’s Women’s Heart Center last year.

Alan Gerry, who built Cablevision Industries into a cable powerhouse before selling it to Time Warner Cable in 1995, has almost single-handedly spurred the local economy of financially strapped Sullivan County, N.Y., with the purchase of the site of the Woodstock music festival and its subsequent rejuvenation. Gerry turned Max Yasgur’s farm into a music and entertainment mecca for East Coast residents and the effort has resulted in an economic boost for the community he grew up in. Gerry also made the first — and largest — donation of $10 million to the The Cable Center, kicking off a fund-raising effort that created the industry’s museum and learning center.

Gus Hauser — CEO of Warner Amex Cable in the 1970s and ’80s, who also ran Hauser Communications until he sold it to SBC Communications in 1993 — and wife Rita created the Center for Non-Profit Organizations at Harvard University to help people, groups and other countries create foundations and non-profit organizations. The Hausers also created an international law program at New York University that taught the nuances of different laws in various countries. He is helping New York’s Lincoln Center digitize and export its content so people everywhere can enjoy its vast library, and his Hauser Foundation has donated to non-profits, hospitals, schools and other public entities.

The John and Maureen Hendricks Charitable Foundation has pledged more than $23 million to various groups in the past decade. Hendricks has given funds to several universities, including Syracuse, Princeton and Strathmore. Many of the contributions have gone to nonprofits and causes based in Colorado. Hendricks has a home on the western slope of the state. Proceeds from the sale of Hendricks’ new biography, A Curious Discovery: An Entrepreneur’s Story, will go to the foundation’s charities.

Amos Hostetter built Continental Cablevision into one of the industry’s biggest companies before selling it to US West in 1996 for $5.3 billion. His Barr Foundation, Massachusett s’ largest, pledged $50 million in 2010 to various Boston-area nonprofits and efforts to fight climate change, according to The Boston Globe. It is currently giving multi-year grants of up to $1 million to public transportation projects and local groups that help reduce greenhouse emissions. In the past decade, Barr has given some $414 million in grants to non-profits in three core areas — environment, education and arts/culture. Mostly anonymous, Hostetter’s foundation went public with its latest announcement to bring more attention to climate change.

When he sold Lenfest Communications to Comcast in 2000 for $1.2 billion, he vowed that all of it would be spent philanthropically within 10 years of his death and the death of his wife, Marguerite. So far, the Lenfests and their foundation have stuck to the their word, giving away about $1 billion. Both are members of The Giving Pledge, a group of worldwide philanthropists who have agreed to give up at least half of their wealth to charitable causes, and remain on the Lenfest Foundation board. The Lenfests have focused on their hometown of Philadelphia, giving scholarships to underprivileged kids, schools and museums. In 2012, the Lenfests gave the American Revolution Center at Valley Forge, Pa., $40 million, according to the Chronicle of Philanthropy. The couple also pledged $30 million to Columbia University for a new arts complex in 2011.

John Malones charitable donations have topped $300 million both personally and through his Malone Family Foundation. Gift s have gone primarily to U.S. schools, including to Yale University, Johns Hopkins University, his old high school in Connecticut and the Denver School of Science and Technology. He gave $50 million to Yale’s School of Engineering and Applied Science to endow 10 new engineering professorships. He donated $24 million to the school in 2000 for the Daniel L. Malone Engineering Center, named for his father. He pledged $7 million last year to expand the science, engineering and math programs at Denver charter school DSST. He has also funneled about $100 million to independent secondary schools for kids who make the grades but don’t have the money, according to the Chronicle of Philanthropy.

Syracuse University’s S.I. Newhouse School of Public Communications exists because of the largesse of the Newhouse family, which provided the seed money in 1964 to get the school off the ground. S.I. Newhouse Jr. and Donald Newhouse donated $15 million in 2003 to expand the school’s facilities. Other Syracuse alumni have also given money to expand the school’s offerings and facilities. Longtime Warner Bros. executive Ed Bleier, for instance, donated money to the school; it named its Center for TV & Popular Media after him. The late Dick Clark donated funds to create studios at the school, which will open next year. Retired Advance/Newhouse Communications CEO Bob Miron sits on the Newhouse School’s board and has given time, money and resources to the school for decades.

Sumner Redstone, through personal donations and the Sumner M. Redstone Charitable Foundation, has given more than $150 million to charities and institutions worldwide. The Viacom and CBS Corp. chairman’s philanthropic endeavors focus on medical research in areas including cancer, burn recovery and mental health at several major nonprofit healthcare organizations such as Faster Cures and Massachusetts General Hospital, as well as medicine in developing countries. Redstone has also contributed to the USC School of Cinematic Arts and the Boston University School of Law, supported the Global Poverty Project’s efforts to eradicate polio and established the Cambodian Children’s Fund child rescue center. This year alone, Redstone donated $3 million to the Museum of the Moving Image, $10 million to the USC school of Cinematic Arts, and $18 million to Boston University Law School. “I’ve tried to live my life by the guiding principles of do all you can, give what you can and live every day with passion,” Redstone said in a statement to Multichannel News. “Throughout my career, I have been passionate about winning and succeeding in business. I have also brought that same passion and commitment to my philanthropic work.”

Dan Ritchie has made it a mission to make the University of Denver the best university in the country and has spent millions of his own money (as well as that of his cable buddies) on that effort. Ritchie, chairman and CEO of Westinghouse Broadcasting (and DU’s chancellor from 1989-95), has given the school his beloved 19,600-acre ranch in Kremmling, Colo., which over time has netted it more than $50 million for various projects. Earlier this year, he gave the school his Montecito, Calif., avocado ranch, valued at $27 million, with proceeds going to construct a new engineering and computer science building. It was the largest one-time gift the university has ever received. Ritchie also convinced his old cable pals to pony up money for the school’s expansion and improvements. Cable execs’ names now adorn almost a dozen campus buildings, including the Barton Lacrosse Stadium, Magness Arena, Williams Carillon Bell Tower and Fisher Early Learning Center. Several TCI executives donated funds to expand DU’s facilities: Peter Barton’s widow, Laura, gave $2.75 million in his name to build the Barton Lacrosse Stadium; Daniels College of Business is named after Bill Daniels, who donated $11 million to update the school’s MBA program; former TCI executive Donne Fisher pledged $2 million for the Fisher Early Learning Center; and TCI founder Bob Magness ponied up $10 million for the university’s sports arena.

Comcast founder Ralph Roberts and his son, chairman and CEO Brian Roberts, have made millions of dollars in mostly anonymous donations through the years, according to a Comcast spokesman. In 2006, the Roberts jointly pledged $15 million to the University of Pennsylvania to help create the first-of-its-kind proton therapy center for cancer treatments. The Roberts Proton Therapy Center opened in 2009. The Honickman Learning Center and Comcast Technology Labs were developed by Project H.O.M.E. in partnership with various local philanthropists, including Brian and Aileen Roberts and The Comcast Foundation. It offers literacy, educational and job training opportunities to kids in one of Philadelphia’s poorest neighborhoods, which suffered from a 57% dropout rate when the center it opened in 2004. Over the years, Brian and Aileen, along with their children, have regularly volunteered at the center, according to the Comcast spokesman.

After his granddaughter was born with Down Syndrome in 2009, John Sie, who had worked for Jerrold Electronics, Showtime and Tele-Communications Inc. before launching Starz and Encore, created the Anna and John J. Sie Foundation, which provides support for the Global Down Syndrome Foundation and the Linda Crnic Institute for Down Syndrome. The Denver-based foundation also provides grants that involve international security and diplomacy, education, arts and culture and the media.

The Tow Foundation was formed by Leonard Tow and his family in 1988. Tow and his wife, Claire, joined The Giving Pledge in 2012, vowing to give the bulk of their wealth away. The Tows sold their Century Communications in 1999 for $5.2 billion. When the family first formed their foundation, their funding was more about passion than structure. “We brought out personal passions to the boardroom and let them guide us to potential grantees,” said Tow’s daughter, Emily Tow Jackson, who serves as executive director of the foundation, on the foundation’s website. Their grant-making began to take a more structured form and focused on medical research, cultural institutions, higher education and journalism. The foundation’s Juvenile Justice Initiative invests in programs that work with at-risk kids and families who may have some involvement with Connecticut’s juvenile justice system.

Ted Turner may have turned heads when he gave the United Nations $1 billion in 1997, but he set in motion a trend that has expanded into a global effort to encourage millionaires and billionaires to donate at least half of their wealth to charity. The Turner Broadcasting System founder sold his company to Time Warner Inc. in 1995 for about $7.5 billion. Since leaving the board a year later (he still asserts he was fired), Turner has built the Ted’s Montana Grill restaurant chain and amassed enough land for conservation to become the second largest U.S. landowner (behind John Malone). The Turner Family Foundation, run by Turner and his five kids, was created in 1990 to concentrate on the environment, climate, maintaining wildlife habitat protection, and curbing population growth. It has awarded more than $350 million in grants since its inception, according to its website. “I think Dad thought it was very, very important to start giving money away while he was still around, so he could see what our interest was in all this. And so he could see his children enjoying the giving,” son Beau Turner is quoted as saying on the foundation’s website.

The Tykeson Family Charitable Trust donated $1 million to Oregon State University at Cascades (Bend) last year to expand its campus. The Tykeson family owns BendBroadband, a cable television, Internet, and phone company in Bend, Ore. Amy Tykeson serves as the company’s president/CEO.

Oprah Winfrey has been involved in various charitable endeavors for over two decades, including a car giveaway to every one of the people who attended her syndicated show, The Oprah Winfrey Show. Now that she is CEO of OWN, the cable network she runs in partnership with Discovery Communications, she is continuing her philanthropic endeavors. “I realized that the only way to create long-term improvement and empowerment, and literally change the trajectory of somebody’s life, is through education,” Winfrey told Forbes last year. The Oprah Winfrey Leadership Academy for Girls is a school in South Africa she started after a conversation with Nelson Mandela. In 2013, Winfrey donated $12 million to The Smithsonian Institution’s National Museum of African American History and Culture. She also has pledged $1.4 million to the U.S. Dream Academy to help the group expand its after-school programs nationally, according to the Chronicle of Philanthropy. The Oprah Winfrey Foundation has awarded hundreds of grants to organizations that support the education and empowerment of women, children and families in the U.S. and abroad including The Oprah Winfrey Scholars Program, which gives scholarships to students determined to use their education to give back to their communities here and overseas, according to her official biography at Oprah.com

TAKEAWAY

Many of those who made their fortune in cable when it was an emerging business are now putting their fortunes to use in philanthropic endeavors.

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