Outgoing NBC Universal CEO Bob Wright feels good about the company's condition as he hands the reins over to his replacement, Jeff Zucker.
Over a 21-year career at NBCU, Wright built up a diverse array of entertainment properties, which he says position the company to succeed in the new era of digital delivery. That is, just as soon as someone can figure out how to monetize the space and prevent piracy, against which he is one the of the industry's most outspoken leaders.
And while he is stepping aside at NBCU, the 63-year-old does not speak like a man ready to put an end to one of the more distinguished careers in the industry.
In a conversation with B&C's Ben Grossman late last week, Wright discussed his most cherished accomplishments, the outlook for Zucker and NBCU, and what his next act may be.
What is the legacy you leave behind?
I feel very proud of what we have been able to accomplish. This is not my company, I don't own this company. I've had access to a tremendous amount of resources for the last 21 years, and I've tried to utilize those resources as best I can. With the help of a lot of people, I think we have really put something together. I think it's novel because it's inside of General Electric and, from the day the RCA merger happened, people said this isn't going to work. So, for a company that was sort of fighting uphill all the way with certain groups of people, and some of them were investors and some of them weren't, it is a tribute to the energy of a lot of people that we were able to put together in this extremely capable company. It's actually a company that is very well-prepared to deal with what is going to happen next.
So will someone crack the model to monetize new media, and everyone will just follow?
The difficulty is that everybody wants to accelerate what's going to happen with digital, but it isn't there yet. I think [GE Chairman/CEO Jeffrey] Immelt said it is in the first inning, and that's probably right. Disney had these fantastic quarterly results, and I don't take anything away from them, but, in those results, they said the total sales from all iPod activities—and they are the leaders for the obvious reason—was $25 million. They can't move the Disney figures around for that.
Is it even important for NBCU to be the first to figure out that digital model?
I want to say to you it isn't important, but you just don't know. I don't think it is. When we launched [online portal] NBCi many years ago, I remember a group of panelists telling me they were skeptical we would make it. That was pretty true, but the reason they were skeptical was, we were the fourth leading search engine out of seven. You know what seven was? Google. Now, Google's entire commercial plan is less than three years old. It shows that you do not necessarily have to be the first to do any of these things but you do have to know when to get in. Microsoft has seldom been the first in anything it has done. They have learned to be patient, but their application of huge resources at some point in time has made them very successful. Google was extremely patient with no business model for the first five years of its life. Then they got one, and they just poured money into it. It's a question of when you get in. But if you are going to wait and hold back, then you are going to have to do a great job when you get in.
Did the iVillage purchase give the company pause as far as growing in the space through major acquisition?
iVillage is a real test of our ability to integrate and grapple with the needs of the Internet and the needs of television. We don't think a publishing model is going to enjoy as great success in the future as we would need, but we wanted it because we thought it was something we could integrate, particularly with the Today show. [Today show Executive Producer] Jim Bell's challenge is to recognize that the iVillage brand is something he's got to bring into the Today show and let iVillage produce pieces and turn it into the lifestyle presence that we want to have.
What is Zucker's biggest challenge?
We have to continue to rebuild the entertainment side of the network. That job is well under way but has to be completed. We certainly have to reach parity with our competitors very quickly, and hopefully, we will do much better than that. The rest of it is really grappling with the impact and opportunities of digital. The good news is, there is so much money being invested by venture capitalists in that space that there will be plenty of things to look at and try to do.
How closely will Zucker's accomplishments in the new position be compared with yours?
In six months, I won't be answering this phone. He won't be compared to me; he'll be compared to other people that are competing against NBC Universal. He will be compared to the performance of CBS, ABC and Fox in TV, to Warner Bros. or Sony in movies, to ESPN and Disney on cable. His comparison outside the United States will be based on profitability. He will have plenty of contemporary comparisons to deal with, and I don't think it will be me.
Is this strategy of cost-cutting and funneling resources into production the right move given the current climate?
There are also some realities here. The production aspect in the digital world is far cheaper than the broadcasting and cable world. We have to recognize that and make sure we understand how those cost differentials can be used in our favor and not against us. We can't take the same costs from our production business today and just walk it over to the digital side. That won't work.
There is a separate mentality here. You have to be able to produce in a way that is more in line with the economics of the digital world. And that is not something we have demonstrated a lot of skill at yet. So he's going to have to fight through that. But in the meantime, you are going to have to reduce your overall costs here as much as possible to be prepared to have money available to do all this stuff. Jeff gets it.
In addition to digital, Zucker says international is a short-term focus. What are the challenges there?
Jeff, in fairness, hasn't had much contact with the international aspect, but we made a decision four to five months ago to have Pete Smith [become president of NBC Universal International]. He is a very experienced Universal employee. He is our international guy, and he is a real operator. I think Jeff is fortunate to have Pete because he'll be able to provide leadership and a knowledge base, and I think it will make it a great deal easier for Jeff than just having to start from the structure we had before.
Will one of Jeff's biggest adjustments be relying more on his lieutenants?
He's going to have to, and he knows that, because it's not possible to do all of that yourself. You just can't do it. International is going to take some time; he'll have to put some time in on that. He started life as a producer, and producers are [hands on]. [Sports & Olympics Chairman]Dick Ebersol and [former West Coast entertainment chief] Don Ohlmeyer were like that. Jeff sees that. He's had five years now with me; he's past that issue. He does delegate. He has learned a lot about how you can impact result and still delegate.
You are leaving earlier than you expected. Do you leave behind unfinished business?
No, not really. I never intended to retire from here at age 65 as the CEO. I always intended to retire after having handed over the CEO to someone else, and I always assumed my last few months on the job would be coaching or handling a transition, not just staying as a CEO. So I thought that would happen toward the end of this year.
What's next for you?
I received a lot of good advice from people, and most recently I had Tom Brokaw shouting at me, “Don't make any big decision now. Pace yourself. Move away from the situation, offer as much help as you can, do what you've committed yourself to do especially on the GE side, but don't make any big decisions. Wait it out until you feel entirely comfortable.” I think that's good advice, and that's the advice I'm taking.
Could you picture yourself working for another entertainment company than NBC Universal?
I could picture myself, but I think there's so many things I want to think about that I really hesitate to answer that question. I've never been not employed since I was 10, and I would like to be not employed for a little while and see what it is like. There are things I would like to do, and maybe those things would best be done in a business I would start myself, or maybe they would be done with others.
Do you envision staying in entertainment?
I've done a lot of things, and I have a lot of other interests. People have called me about doing things in entertainment. There are potentially some very good opportunities coming in entertainment from an investing standpoint. I assume you'd have to say there was more than a 50% chance that, if I were going to do something, that's where I'm going to do it. I also have my charity work, and we have some big things we want to do with Autism Speaks, and we have a lot of meaningful opportunities in front of us, so that will be a major effort for me.