Ted Turner used to be a great Internet entrepreneur. He used to make big decisions. He even bet his company. (If he had a cat, he’d have bet that, too.)
Turner had an Internet strategy long before anyone had heard of the Internet. He bought the tiniest station in Atlanta, called it Watch This Channel Grow (WTCG), and then made it available by satellite. He had the audacity to create a news channel for the satellite. He gave it all away to the people, and in turn, he was showered with money. First give, then take — sound familiar?
But after selling Turner Broadcasting System (TBS) to Time Warner and becoming (nominally) vice chairman, Turner let the suits break him down.
I think their breakdown tactic was meetings.
Have you ever been to a big corporate meeting? Well, everyone sits around and talks nonsense until someone goes to the bathroom. During that individual’s momentary absence, the other suits divvy up his or her power among themselves. By the time he or she gets back, it’s all over. The iron bladder always wins. It’s bureaucratic infighting, not victory in the marketplace, that controls the game.
This is not the way entrepreneurs work. Entrepreneurs know that they have the power and deploy their assets against the market like chess masters. They’re directed outward, not inward, and usually have no patience for corporate meetings.
The suits also beat Turner because they delivered “shareholder value.” In the Clinton economy, every media company was winning big-time, and Time Warner was getting its share, which made Turner filthy rich. “Concentrate on your lovely wife. Concentrate on giving away your fortune,” the suits intoned. “Enjoy your bathroom with its lovely fixtures — we’ll mind the store.”
The America Online deal was also about shareholder value. Back in January, AOL was worth twice what Time Warner was. This deal doubled the value of Turner’s stake. So what if it was all air; he was out by that time. And since the lovely wife had married an entrepreneur not a stand-up comic philanthropist, she was gone in due time, too.
So I wonder what Case’s weakness is (Turner’s was vanity) and how long it will take the suits to break him down. Case is young, and his major-domo, Robert Pittman, is also young. Pittman even has experience (from his MTV days) working against the suits. And both have very strong bladders.
Case might have a chance of remaining an entrepreneur if he can move the head office down to Virginia. But the suits will argue that you can’t run a major media company from Virginia (any more than you can run one from Atlanta), and the Wall Street types, also based in New York, will back them up. Case will be stuck in New York, surrounded by the enemy holding meeting after meeting. (Sure you don’t need a bathroom break, Steve?) He won’t stand a chance.
Case did his shareholders a great favor by hitching them to Time Warner. Media assets are real assets because people want their MTV. It’s just a matter of time, though, before the suits have Case, Pittman, and the rest of AOL firmly in their clutches. I give it a year. (Hey, do I hear water running?)
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