At the BROADCASTING & CABLE Hall of Fame ceremonies last week, I chatted up John Malone, who was there to honor the late Peter Barton, one of his protégés and one of this year's inductees. Malone allowed as how he and Murdoch would like to get their hands on DirecTV but stressed that they couldn't even talk to the principals until the DirecTV-EchoStar merger was officially called off by the parties. "Tortuous interference," he said.
It was good to see the 'Cable Cowboy' back in the saddle, getting ready to make a big play and bantering with a reporter about it. Malone is one of the TV industry's true leaders, entrepreneurs who not only manage to make a bundle but also show the rest of the industry where to go next and how to get there.
It was good to see because such leaders are in short supply. Malone's only peer in the leadership realm is Ted Turner, who has more or less gone underground since being pushed out of an operational role at AOL Time Warner.
What does it take to be a leader? Bold strokes, for one. Malone's move was to buy up every cable system he could and persuade Wall Street to evaluate them on the basis of cash flow so he could buy even more. All those cable subscribers gave Malone extraordinary leverage with hardware suppliers and programmers. And he used some of that leverage to take ownership stakes in cable networks.
Turner made several extraordinary plays, chief among them the creation of a 24-hour news service for the world when only a few million homes in the U.S. could receive it. Los Angeles Times
last week quoted CNN correspondent Aaron Brown's comment after Ted swept through the CNN newsroom on Election Day: "When Ted walked in the room, it really crystallized for me where I am, what we are, how we changed the business," Brown said. "These guys had a vision."
With Malone heading for DBS land, Comcast's Brian Roberts could become cable's leader, the guy who restores the industry reputation among investors with solid management, honest bookkeeping and a few bold initiatives to demonstrate cable's upside. He will certainly have the clout. And this time next week, he will command a company with the kind of heft even Malone would envy. A third of all cable subs will be sending him a check every month.
But what of broadcasters? They are in desperate need of a Malone or Malones to take the point. They have been fighting a rear-guard action against cable and satellite for 25 years, and they still haven't a clue how to exploit the digital spectrum they've been given.
The place broadcasters have traditionally looked to for guidance were the owners of the big broadcast networks: the Paleys, Sarnoffs and Goldensons. Today, the networks are run by middle managers in large multimedia corporations with as much interest in cable and publishing and the Internet as in broadcasting.
Mel Karmazin has potential. He's a broadcaster at heart, and he has the entrepreneurial spark. But so far he is playing to his strength, squeezing every drop of operational efficiencies out of the businesses he has rather than inventing new ones. He is also hobbled by the fact that he shares power at Viacom with Sumner Redstone and, in fact, may be the odd man out.
You see some flashes of leadership on the broadcasting side: Stan Hubbard trying to launch a broadcaster-only DBS service; Bud Paxson trying to build a seventh broadcast network out of a bunch of fringe-market UHF stations; Jeff Smulyan trying to rally broadcasters to demand, really demand retransmission-consent dollars from cable; Gary Chapman trying to persuade others to open a broadcast lab; Post-Newsweek's Alan Frank trying to prove that strong TV stations can be just as profitable without a network affiliation.
But these are only flashes.
I, for one, am hoping Malone wins DirecTV and takes an active role in its management. And I'm looking forward to Ted Turner's assuming the chairmanship of AOL Time Warner, despite his political incorrectness. This newspaper needs good copy. Leaders always supply it.
Jessell may be reached at email@example.com