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NELSON: Hello, I'm Steve Nelson, and our guest today is Char Beales, president and CEO of CTAM, and we're going to talk about Char's life and career. Char, welcome.
BEALES: Thank you.
NELSON: Thanks for joining us. So we're going to take you back to the beginning, to your childhood. Where did you grow up?
BEALES: I grew up in North Bend, Oregon, which is a very small town on the south Oregon coast, a town of 8,000. We were right next to a larger town called Coos Bay with 12,000.
NELSON: That's a beautiful spot.
BEALES: It's a beautiful spot, but it's pretty isolated.
NELSON: So did you have TV stations there? When was this?
BEALES: In the '50s. We actually got cable very early because the Cascade Mountain range blocked the TV stations in the valley in Eugene and Portland. We also had one TV station in Coos Bay. I don't remember getting cable, but I do remember that all holidays that used to be equally rotated among the aunts were moved to our house because we were the only ones who had cable.
NELSON: So it was a family thing, you were different.
BEALES: The family thing, for each holiday, but especially if there was a sporting event. All family holidays had to be at our house. My mom wasn't so happy about that, but we were the only ones with cable. You know, of course cable started in nearly simultaneously in several places. Astoria, Oregon was one of the places, so cable television migrated down the coast pretty fast.
NELSON: Of course we're talking a reception service at this point.
BEALES: Yes, but we also had our own channel where the camera was on the barometer, it panned to the clock, and then it went to the fish bowl. It was one of the most popular channels because they backed it with a radio station from the valley. We only had one radio station in our town, and so getting a second radio station was really popular.
NELSON: So I guess that was reality TV – the barometer and the fish.
BEALES: And the clock! Absolutely.
NELSON: Were there any other TV programs besides that that you particularly remember as a child that you really liked, or for some reason really struck you? We all had favorites, right?
BEALES: We all had favorites. I was a huge I Love Lucy fan and I still am. I raised my children on I Love Lucy. My dad was a big sports fan and seeing boxing on late at night, I thought that was very strange but we watched it.
NELSON: Of course it was free.
BEALES: It was free [with cable]. My mother loved animals so we watched the Wide World of Animals, Mutual of Omaha, all those kinds of shows. My mother was also devoted to Lawrence Welk, which was very sad, but in our house that's what you watched. It was a very rural area where I grew up. We were outside a lot of the time. TV didn't play quite the same role in our lives that it does today.
NELSON: And what did play a role in your life, in that case, in that kind of an environment?
BEALES: Well, we were outside a lot. We roamed all over the neighborhood and did all kinds of things. We were constantly busy and my family's business at that time was producing practical and beautiful gift items from a very rare wood that only grows in Oregon and the Holy Land. It's called myrtlewood. We had the largest – we called it a myrtlewood factory – today I think it would be a craft shop on the Oregon coast. We employed about 25 artisans who turned this very hard wood, it's about 40% harder than oak into beautiful pieces – dishes, bowls, trays, coffee tables, and so on. I was very involved with the business even as a young child and I gave tours in the myrtlewood factory on a regular basis taking busloads of people or carloads of people around, showing them how each piece was made and how we finished it and that sort of thing.
NELSON: So you weren't exactly a farm girl in those rural days.
BEALES: I was not a farm girl. My aunts and uncles and a lot of our friends were farmers, but we were not. We lived in the "suburbs".
NELSON: And you had a small business.
BEALES: And we had a small business.
NELSON: And then high school? What was that like? Did you go there, or was there a regional sort of high school?
BEALES: Yes, a real small town, and actually the claim to fame in high school is that I went to school with Steve Prefontaine, who was a very famous distance runner, and I went on to the University of Oregon for two years, and Steve was in the same dorm before he was so tragically killed in an accident. It was very all-Oregon, very small town.
NELSON: He became the subject of a very well known documentary, as well.
NELSON: That's interesting. So that was sort of your first contact maybe with the connection between the world and what was depicted on TV.
BEALES: Correct. That's a good way to look at it.
NELSON: So when you went off to college, what did you go to study?
BEALES: Well, I was very interested in debating. I had debated all through high school and in college. My family was of modest means, and so they said if I went to a state school for two years I could transfer anywhere I wanted. So after finishing two years at the U of O, where I was a duck, I transferred to George Washington University in Washington D.C. I had seen the campus on a trip east and fell in love with Washington D.C. They had a really fine debate program, and so I went there as a debater. I was interested in sociology and ended up in communications.
NELSON: Which went a long way. I mean, here you are, an Oregonian all the way, and all of the sudden you're on the east coast. What was it about that that attracted you? Was it just the change, or Washington certainly has a certain aura about it?
BEALES: Exactly. The change, and quite frankly, I wanted to see if I could make it in a place where I didn't know a soul.
NELSON: And you didn't. So you went there your junior and senior year?
NELSON: And sociology? That's interesting. Why sociology?
BEALES: I had a magical professor who inspired me, like lots of people. What I really took from sociology is studying and researching human behavior and consumer behavior, and that's been a theme throughout my career, actually.
NELSON: So, any other recollections of college? Anything that happened there that affected your career?
BEALES: Well, my senior thesis was on public television stations, and I was able to get data so that I could compare two different public stations' viewership and fundraising and tie it back to the marketing tactics that they used. That propelled me into an internship at the Corporation for Public Broadcasting right in the midst of Nixon and Spiro Agnew going after them. It was a very hot place that summer. I found all of that pretty interesting. The other big thing that happened in college is in a final debate round we were debating Georgetown and I met my future husband, Howard Beales.
NELSON: Was he on the other side?
BEALES: Yes, and it was a three-two decision, which he still reminds me of to this day.
NELSON: Oh, he won?
BEALES: Three-two, but it was split. It was close. We married right after I graduated and headed off to Chicago where Howard was going to graduate school at the University of Chicago. I luckily landed a great job in media, two great jobs in media actually, that really sent me on my way. I started at J. Walter Thompson as a media buyer and got to buy television schedules for Kraft Foods throughout the Midwest in the small markets, and those of course were markets that were early cable markets. So when people talked about Tyler, Texas I knew about Tyler, Texas because I used to buy media in Tyler, Texas. I also bought radio for the Chicago Ford dealership group in the Chicago market. That was interesting and I learned a lot about the economics of the business based on media. I got recruited away to WBBM TV, which is the CBS O&O station in Chicago. There were an extraordinary collection of people there at the time who have gone on to be business leaders in television and cable. We were all the assistants. I was the assistant research director. Ed Spray was the assistant programming director; of course he went on to be the president of Scripps Networks and build up that entire company under Ken Lowe. John Miller was at the station, he was the assistant promo director. Of course he's been head of marketing at NBC for twenty years. Johnathon Rodgers was there at the station as the assistant news director. In fact, one day the brass were off at a meeting in New York, and Johnathon and I were the most senior staff when Mayor Daley the senior died. We had to run the station on that day, which was a big news story in Chicago, obviously. So it was just an extraordinary collection of people... Rod Perth was there at the station in sales. Bill Curtis – he was our anchor. Of course now he's been producing cable shows for a long time. It was just a great group of people who've gone on, most in cable, in their career. But I learned some interesting lessons at WBBM. First of all, I learned – and being in research – that the broadcasters were in trouble even in the mid-70s.
BEALES: Well, the sales department would require me to produce reports on the ratings for the news in which I removed the independent stations and the syndicated programming and recalculated the shares as is all people were watching was news. I kept saying, you know, I was a media buyer. I think they're going to probably figure out that more people are watching WGN at news time than are watching the news. I thought, gee, this is really odd that they're managing things this way. I also learned there the power of cable. WGN at that time had a very powerful distribution network via cable throughout the Midwest. When Midwesterners would come to Chicago, they'd go see the Loop, but they'd also drive by the car dealership that advertised on WGN because they had a compelling pitchman. He was famous and people would come on their vacations to see him just like they'd see any other landmark. And that was the power of cable. That, sort of put together with the power of cable at home where we had to change the holiday schedule so that we could watch the TV, to see the power of a super station, and I said, you know, I think this is going to be something.
NELSON: Something going on here, huh?
BEALES: Something going on here.
NELSON: I want to go back just a little bit for a moment to J. Walter Thompson. You said you were buying cable time, is that correct?
BEALES: No, just broadcast, but later those markets became really the mainstay of cable.
NELSON: Yeah, because you know a lot of the ad agencies weren't too favorably inclined toward cable at that point.
BEALES: No, no, no, not yet.
NELSON: So you had this group of young Turks, I guess we could call them, that all showed up at the station at the same time and went on to other things. Why did you leave? It seems like it was such an exciting place to be.
BEALES: It was fabulous. I loved Chicago, but we were living in Hyde Park. We were there four years, we were robbed four times, and my husband finished his Ph.D. in economics and said, "You know what? I think we ought to move on." So we went back to D.C., and I love D.C. so that was fine. I went to work for WRC, which is an NBC O&O doing ad sales research, it was a smaller market, so I added the marketing as well. It was a tough time for NBC. Fred Silverman was running the network, and our big "hit" show was Super Train. It was not a pretty place. I noticed in the afternoons I was shutting the door and turning up the sound on the soap operas, and I said to myself this is not good. I was reading Broadcasting Magazine – it wasn't Broadcasting and Cable back then, it was Broadcasting Magazine – and they had a huge feature article on the largest cable system in channel capacity in America, and that was right in Arlington, Virginia, ARTEC was run by John Evans. I called up John's office one afternoon and said, "I'd like to come to work for you." They arranged an interview for me and so I said, "Whoa, I don't know anything about cable. I better get prepared." I called the NCTA and wanted them to send me information about cable, and the receptionist said, "well, what do you do?" I said, research and marketing and promotion. She said NCTA's whole department just quit. I can get you an interview with Tom Wheeler, the president. So I said, well, that sounds good. We were young, we didn't have such set career paths back then, and so came in to meet with Tom...
NELSON: Sure, why not?
BEALES: Tom is the most persuasive, compelling, exciting guy you could ever imagine, and so even though it was a public policy research position, my debate background actually fed right into that. So I accepted that job, called John Evans and cancelled the interview...
NELSON: Never went to see him?
BEALES: Never went to see him!
NELSON: Has he forgiven you?
BEALES: He has forgiven me. He's been a wonderful friend for a long time. So I went to work at NCTA and lo and behold, I find out that the person who had left he job that I was taking over was Kevin Leddy, who had been there between college and graduate school and had left to go get his MBA, and so I stepped in.
NELSON: But this was public policy, which you said you'd been doing marketing research, and marketing – you sort of glossed over that a bit – what kind of marketing were you doing at the TV station?
BEALES: Well, marketing at TV stations was about getting viewer for the local news shows the on-air promos, and bought radio and newspaper ads – because I'd been a media buyer, I was buying the ad time prior to and during sweeps to get people to watch our station so that we could then boost the ratings and keep the engine going. So I was back to being a media buyer in a lot of ways.
NELSON: But you also had that hands-on experience of actually marketing something.
NELSON: I just wanted to get that on the record.
NELSON: Now here you are at NCTA. What year is this you're now starting?
BEALES: In January of 1980.
NELSON: And what were your duties? What was it like? Now you're in this association which is a different kind of environment.
BEALES: Exactly. They talked to me a lot about copyright research. I was going to be needing to do a lot of research because of course copyright was tearing our industry apart at that point after the Supreme Court ruled that cable actually had to pay copyright to retransmit to local stations. But before I started researching copyright, in my first week at NCTA, they said, well, you've been in broadcast television so we need someone to go over to the Kennedy Center. There's this group called the NFLCP, which was the National Federation of Local Cable Programmers, and they're having a conference arguing that we need public access. We want to say that we have local origination which serves the local communities. We don't want to give up all those channels for public access. We have this important general manager coming to represent us and you need to go and mix it up with him. So off I go, and the general manager was with the Viacom system in Long Island, Jim Robbins. So I got to meet Jim and we argued they had a good local origination channels. That debate of course went on for many, many years, and through deregulation, and the public access folks were very powerful voices in Washington. That was sort of an interesting experience. Then literally the next week they said, well, we need someone to go to Chicago because our accounting committee is meeting and we have no one to take the notes and there's a big issue about FASB[Federal Accounting Standards Board]. So I said, well, great, I'll go to Chicago. I get there and I realize that they were speaking a different language, these accountants arguing about how the tax consequences would be counted and what the standards should be. But this giant man, big, powerful man, said, "Sure, I'll help you," and he took me under his wing. That was Julian Brodsky. He helped me write the notes about the accounting committee.
NELSON: I guess I should have seen that coming.
BEALES: And of course Julian's been a friend and a mentor ever since. So then, about the third week...
NELSON: This was a pretty fast moving job here.
BEALES: Well, cable was very hot. Remember, in the early '80s, all of the sudden it was all over the news.
NELSON: A lot of people starting jobs, you just sort of plod along for awhile. You were all over the place.
BEALES: Oh, no, no, no, we were going fast, and that was Tom Wheeler's MO to get out there and get going. So we were invited to go speak at many conferences. I subbed for someone at a conference in New York City on advertising and the role cable was going to play. I'd been in broadcast and I knew about advertising, of course I should go speak about this. So I joined the panel with a group of executives including Pete Gatseos, who was at ATC, and Susan Whiting and Dave Harkness at Nielson who were creating a new business in ratings for local cable and the new cable networks. We became quite the fast friends and a little panel literally traveled all over the country for a couple of years talking about cable advertising. So I got back to Washington and I said, boy, these people at NCTA have a funny definition of research. I don't seem to be doing a whole lot of research, but this is fun and it was really what was going on in cable in those days, too. If there was a job to do, and you could do it, more power to you.. But I did actually then did some research.
BEALES: Yeah, finally. We were working hard trying to get deregulated. We were making some traction but Tom felt that we needed to prove that there would be other competitors to broadcast, not just cable. Congress wasn't going to change the law and open up competition just for one industry, that wouldn't be prudent. So we needed to prove that there were going to be other competitors. I commissioned a study from Paul Bortz, and he had of course been in Washington at the NTIA, and he knew policy before opening up his consulting shop. At that time, COMSAT was offering an early DBS service. There was MDS, multi-point distribution service, and STV, subscription TV that was over the air. Paul and his team produced a fine study that showed that these technologies would work, that there would be a market for these competitors, and that they could be viable.
NELSON: But of course none of these competitors really amounted to anything.
BEALES: Well, so Tom takes the research around the Hill and shows them all this.
NELSON: You had to have something to work with, right?
BEALES: Right, something to work with, but Wall Street got wind of all these powerful, potent competitors and the cable stocks declined, and Tom turned around and said...
BEALES: And of course who did it backfire on but me. Fortunately I was able to keep my job, but there were a lot of very upset people because before deregulation getting financing was so difficult. As we all know in this industry, you don't mess with the stocks. I also then started doing a lot of work on programming because cable networks were launching in rapid order. We had Home Box Office, Ted Turner's Superstation, the Cable and Satellite Public Affairs Network before we even called it C-SPAN, and the Entertainment Sports and Programming Network before we called it ESPN, and then of course CNN, which was more commonly referred to as Chicken Noodle Network at that point. So a lot of us said we've really got to change the perception, we've got to get the word out, our competitors are national – you know, ABC, CBS, NBC. How do we start to really make some progress? NCTA had an awards program that they had started a few years earlier, when HBO had launched and had those early Bette Midler specials. So there was a little bit of focus on network, much more focus on local origination, which actually was pretty vibrant in those early days. Tom asked me to take over the ACE Awards.
NELSON: This is when they're starting.
BEALES: Yeah, the ACE Awards were a convention kind of award where we'd give it out at the NCTA show. we started saying, gee, we could maybe turn this into a little bit more; perhaps we ought to take it a little more Hollywood. Showtime had launched and once they started there was some competition to HBO for high profile programming. [The first big competition between HBO and Showtime was the year HBO had Simon and Garfunkel in Central Park and Showtime had Diana Ross in Las Vegas, and it was a really amazing competition.] we used to get hundreds of entries in those days, and the judging process was we'd box them all up and we'd ship them to an exotic resort in Florida. we'd bring twenty industry producers and network executives to the resort, and sit in rooms for 20 hours a day, watching the TV programs, judging, and never take advantage of the resort. So I changed that.
NELSON: It got you out of the office so you could watch TV.
BEALES: I changed that, and we moved the judging back to Washington. By then Wheeler had left NCTA and Jim Mooney had become the president. He saw some real value in promoting the programming, getting the word out there. He particularly wanted to promote local origination C-SPAN and CNN, but he understood that consumers were really keen on the emerging cable network programming. So we took the ACE Awards to Beverly Hills. For our first show Robert Wussler persuaded Ted Turner put up the money to produce it and broadcast it on TBS in primetime. We really struggled in those early days getting talent for the show. They hadn't really heard of cable out there in Hollywood and we were busy violating everything the Director's Guild and the Writer's Guild wanted, and so it was a little contentious. For that first show I think actually the only talent we had that was a household name was Mickey Mouse.
NELSON: Did he make a personal appearance?
BEALES: He did, he did. I learned all about the union requirements for the mouse.
NELSON: And there was obviously Disney Channel at this point.
BEALES: Disney Channel was huge. I think at the last minute we persuaded Cloris Leachman to be the host, and we had a lot of folks nobody had ever heard of yet. Of course they went on to be very well known. I mean, Bernie Shaw was in that first show, and at that time nobody knew Bernie Shaw, but of course after the first war in Iraq everybody knew Bernie Shaw. We had Chris Berman, the MTV VJs, etc. So they were the up and coming talent, but it was pretty exciting that we produced that first show.
NELSON: And where was that first show? You said Beverly Hills.
BEALES: The Wiltern Theater.
NELSON: Oh, okay, so you're now in a theater. Because then it moved to the Pantages, at one point.
BEALES: We did the Pantages. We were all over LA with the ACE Awards as the years went on, but it really was... I think all of us in those early days had a sense that we were there to change television, and I don't think any of us thought we would ever do it so fast, and we really did. Cable has just changed the face of television. It's so exciting to see. At the same time, though, on the cable company side, they were delivering this new programming that was popular with consumers, they had gotten deregulation through Congress, so financing now was becoming available. They won franchises in the urban markets, they were starting to build them out, when CTAM was founded. of course it was a very small organization that had been founded in 1976 when HBO went on the satellite and the marketers all looked at each other and said, whoa, we've got to get consumers to pay for something that they can get for free from ABC, CBS, and NBC. How are we going to do that? Let's get together and share information. The marketers were a little paranoid, though, back in the early '80s, and they were convinced that NCTA was going to take them over because they were doing the cool stuff.
NELSON: Were they at this point organized as CTAM?
BEALES: Oh yeah, they were organized.
NELSON: Wasn't that the first airport meeting?
BEALES: The first Chicago O'Hare meeting. Actually, the idea for CTAM was generated in New Orleans at the end of the 1975 NCTA convention. There was flooding, a lot of people had trouble getting out . Jerry Levin of HBO had demonstrated the satellite transmission at the show. Greg Liptak , Tryg Myhren and Gail Sermersheim all got together and said, yikes, we've got to start something, and so then they had the O'Hare meeting. So CTAM was about six years old when I got involved. They didn't have real paid staff. Lucille Larkin was part time, so they were trying to get organized. There was this great fear that NCTA was going to take over CTAM, and so John Sie came in and brokered a deal proclaiming that NCTA was the mothership and all the other organizations should have a relationship with NCTA but be separate. As part of that deal, NCTA would get someone on the CTAM board and that was me. So I joined the CTAM board, I think, in '82.
NELSON: Now why did John Sie become the broker for all this? Who was he at the time?
BEALES: He was at Showtime. He was the EVP of Programming and Marketing at Showtime, and he was John Sie.
NELSON: So he inserted himself in the process.
BEALES: He inserted himself in the process.
NELSON: I was just wondering who appointed him?
BEALES: John Sie.
NELSON: But those relationships though, the nature of the relationship between NCTA and other organizations, sort of put that in place right there so that there was the independence preserved but everyone understood...
BEALES: Right, and that allowed some of the other organizations to grow over the years and CTAM to have a good relationship with NCTA. So that's how I got involved in CTAM.
NELSON: So you're now on the CTAM board. What year is this?
BEALES: I think it's probably '82 or '83, it's pretty early. And so being marketers, of course, and trying to launch in these urban markets, they're struggling. They've got a whole set of programming that we know is great but consumers have never heard of.
NELSON: Starring people they don't know.
BEALES: Marketers had to figure out how to sell this stuff. So of course they all wanted research, and so I said, no problem! I do research. I'll do a research project and NCTA will contribute this to the marketers. Jim Mooney backed me and funded a major study. I don't remember now how much it was, but at the time it was an enormous amount of money.
NELSON: Because CTAM itself couldn't possibly have done...
BEALES: Or even the companies at that point didn't invest in research. I commissioned Opinion Research Corporation in New Jersey to talk to consumers and find out what they were looking for and identify messaging that could get across to them. The project leader on that study was Howard Horowitz and his colleague was Grace Ascolese, and they came up with the term
'truck chaser" for the phenomenon that was going on in the market because people were so anxious for program choice that they would chase the cable truck down the street in order to sign up. That really was a turning point in a lot of ways in the marketing because it gave us all enormous confidence that we had something that consumers really wanted. We just had to tell them about it and we had to be clear about the virtues of this great new programming that we were delivering. By then MTV had signed on and USA was becoming powerful, BET moved from sharing time on USA to their own channel. So we had programming that appealed to different target segments, of course " truck chasers" was a clever name, but it also captured the excitement of the moment.
NELSON: That maybe is a little marketing lesson, too, is that sometimes, I think most of the time, it's a lot easier to really sell something, get behind it, if you really have a good name for it.
BEALES: That's absolutely true.
NELSON: We don't have to talk about this now, but that was always one of the issues with the name pay-per-view.
BEALES: Absolutely. I was thinking about that because in the early days, in those days, we called our premium networks "pay TV. When Tony Cox went over to Showtime he decided that he personally was going to change the name and eliminate pay TV and make it premium TV. And through the sheer force and will of his personality he achieved it. Today we still call it premium television, which is what it is. We did not heed that lesson, however, when we went down the pay-per-view path.
NELSON: Okay, so truck chasers, marketers, you've now got confidence. You've got something you can sell.
BEALES: Absolutely. And the ACE Awards were growing. We started to poke around and said, gee, it would really be better if we won awards through the Emmy process because it would be better to beat them at their own game on their own air, and get exposed to a broader audience. We knew we needed a bigger audience for the ACE Awards, and we really needed a way to figure out how to get in the Emmys because they would not allow cable to even enter.
NELSON: I'm not that surprised.
BEALES: They had a wonderful rule that as a national network you had to reach 20% of the country, and of course no cable network reached 20% of the country, not the least of which was HBO and Showtime because they were premium networks. So we thought, oh my goodness, this is an insurmountable barrier. How will we get in? We said, well, why don't we start our own academy? And so we created the National Academy of Cable Programming. Our first chairman was Ralph Baruch, who was chairman of Viacom, and they owned Showtime. Ralph was an historic joiner and organizer, and we put together a pretty darn impressive board of the heads of all the cable networks – Michael Fuchs, Tony Cox and John Cooke, who was at the Disney Channel. Studio executives like Jonathon Dolgen who went on to be the chairman of Paramount, [and Mel Harris.] Producers like Don Ohlmeyer.
NELSON: He wasn't a cable guy in that sense.
BEALES: They were investing in a cable network.
NELSON: So he lent his name to this...
BEALES: Robert Wussler, of course, was very involved, and we determined we've got to get more publicity for these cable programs. we've got to make our own award show more powerful. we've got to use that as leverage to get in the Emmys, and that was really always the game we were playing. It was pretty much a sham academy, I have to say, in hindsight. We had a four-line phone – by then I was heading the marketing and programming at NCTA. So we just took one of the phone numbers and that became the National Academy of Cable Programming. Anybody called it, it was the National Academy. All the other three lines, NCTA. One day, Jim Mooney called down, he got on the wrong line and he was shocked to find out that we were answering the phones the National Academy of Cable Programming. But we created this board and they were very sincere and dedicated, and in fact, toward the late '80s Ted Turner funded most of the ACE Award shows, I think virtually all, and then we said, well, wait a second, we need broader distribution, how do we break through? And so Tom Burchill, who was heading Lifetime, and I worked very closely together and we created the first primetime roadblock for the ACE Awards We had twelve networks carry the ACE Awards live, in primetime, simultaneously, and this included USA Network and TBS. We even got ESPN to air it.
NELSON: Wow! Really?
BEALES: Now, the ratings were still terrible.
NELSON: I was going to say, as a former research person, broadcast television, put them twelve together, what have you still got at that point?
BEALES: Well, it was huge, the ratings went up. We did get...
NELSON: From a cable standpoint it was huge, but from...
BEALES: We were still miniscule, absolutely miniscule, but it taught us that we could work together, even on the cable network side. It taught us that there was some value in collaboration even though they were competing. I think those lessons have laid the groundwork for a lot of the things that we ended up doing today. Back then we were forming, out of that collaboration, a really healthy partnership to go before the television critics because we knew that was the other piece of the puzzle, and Louise Rauscher, now Louise Mooney, had a PR firm in LA, and she had the idea to bring all the networks together before the critics. Louise inspired us to show what's happening with cable programming. We started, through my department, this outreach to the TCA that still goes on, lived at NCTA for a long time. Ironically, it's full circle back with CTAM now and I'm back with the television critics. But it was important to reach that audience as another avenue to reach consumers. We would invite those critics to come be final judges in the ACE Awards so that they would have to watch the programs.
NELSON: So you've got the ACE Awards now. They're really cooking, and you've got this road blocking. The Emmys of course are still going on, and you're trying to get the cable programming into the Emmys. So, now, how did you finally break down the gates?
BEALES: Well, I'd like to say it was us, but in fact I think it was the cable networks who became the home for innovation for Hollywood producers, directors, and writers, and of course HBO led the way there by allowing true creative freedom that they allowed. Showtime was having breakthrough programs with Shelly Duvall's Faerie Tale Theater.
NELSON: That was a great show.
BEALES: Cable suddenly got the reputation within Hollywood that this was the place to go where you would get paid for innovating. You could do all of the things you really wanted to do and you weren't allowed to do with the broadcast networks. So it was really a groundswell within the ATAS organization from their own members who said, "I want my show to compete in the Emmys because I think it's better quality than what you're doing for broadcast," and so that groundswell came from the bottom up.
NELSON: The grassroots, sort of, if you consider those people grassroots.
BEALES: Exactly, and ultimately their own members said let's let them in.
NELSON: What year was that, do you remember?
BEALES: I believe that was in, I'm guessing it must have been in '90, 1990. I left NCTA in December of '89.
NELSON: But this came to fruition.
BEALES: It came to fruition; the ACE Awards went on for another year or so and then we said, "You know what? It's a lot better to beat them at their own game on their own air."
NELSON: So do you remember offhand who, if any, were the cable winners when they first, or nominees when they first...?
BEALES: HBO. It was only HBO. HBO was dominant from the beginning.
NELSON: Any particular programs at that point in time?
BEALES: I don't remember. I didn't go back and look up...
NELSON: Yeah, because HBO was that place that the creative community in Hollywood really got engaged with and really respected because they got that creative freedom.
BEALES: Exactly, but then the cable networks started getting in there, the basic network guys started getting in there. Showtime came in there, and before you knew it we're to the point where HBO has been getting the majority, the highest number of Emmy nominations now for a couple of years beating the broadcast networks and it's really worked out well to spread the word about the wonders of cable programming.
NELSON: And even at points provoked some jealous remarks from certain executives in the broadcast business about gee, these guys, it's not fair, they can use four letter words. Just in terms of setting the time of where we're talking now, we're waiting to find out in the current round of Emmys whether HBO's John Adams or AMC's Mad Men gets more awards.
NELSON: So it's really gone from you're outside the door to where cable is almost dominant.
BEALES: Absolutely, and viewers have said the same thing. I think back when we knew we were going to change television. We didn't know how fast. The three big markers for me, I guess, were we always said when cable gets in 50% of the homes we'll start to make an impact, and that was a red letter day when that happened. We then said when cable gets 50% or more of the viewership that will be amazing, and of course that happened. My old friend and colleague and boss, David Poltrack, at CBS, gave many a speech over the years that that would never happen. He was wrong. And then for me, actually the third marker was when about two or three years ago when ABC decided to rebrand ABC Sports on air ESPN on the ABC network. That really said...
NELSON: And where is Monday Night Football, a great ABC staple, now?
BEALES: The tide turned. We changed television.
NELSON: Well, in fact, just around the time that cable was reaching 50% of the homes was when the NFL, speaking of football, came along and created the Sunday Night Football, which I think was a huge, huge...
BEALES: Oh, it was huge, absolutely.
NELSON: ...landmark, in terms of NFL, cable? Wow! Okay, let's go back to you. 1989, December 1989, I heard you say you left NCTA.
NELSON: What was the reason?
BEALES: Well, Robert Wussler had left Turner and came to COMSAT, which was based in Washington D.C. and they were a regulated monopoly to use satellites to facilitate telecomm around the world. Their regulated monopoly was declining, and so he was hired to find unregulated businesses that could replace that revenue. Wussler recruited a number of us from the cable industry to come over with him and we had a great couple of years. We inherited a hotel pay-per-view system that was primarily in Holiday Inns that didn't really work very well. It seemed to have a propensity to charge rooms that were unoccupied for ordering movies, and a lot of other anomalies, so we said maybe we should move on from that. So we bought the Denver Nuggets, and we bought another pay-per-view system in hotels called On Command.
NELSON: Which did work.
BEALES: Which still works really well today. We went to eastern Europe, it was in the early '90s and everything was changing in eastern Europe, and partnered with John Kluge and Stewart Sabotnik to get and got some wireless telecomm licenses. I was the programmer for the wireless cable system in Moscow for a couple of years and we did a lot of fun stuff.
NELSON: From a distance, or did you...?
BEALES: I had to negotiate the programming in London, and in Moscow the small dishes were too distant to pick up the signals from western Europe, so COMSAT was in a unique position to bring in those signals because we could put the big dishes in. But then COMSAT's management changed and they decided that they wanted to reinvest in the regulated side. Coincidentally, I was winding that down and Matt Blank came to me and said, "Gee, I'm chairman of CTAM, we need a leader and why don't you come and run CTAM. There might be a few little problems with it right now, but, you know, nothing you can't handle, Char, come on over." So, you know Matt Blank, he's so persuasive. And I don't think Matt, or the board, had any idea of the financial problems CTAM was in, but at that time...
NELSON: And you didn't, either, in that case.
BEALES: No. It was branded as a mile wide and an inch deep. A lot of programs were too small to make an impact. They had made some bets that didn't really turn out and lost their reserves on customer service training materials. Great idea, but the timing was not quite right, CTAM had a very expensive database measuring market share and premium. As that first round of consolidation went around there weren't enough buyers, and so there were some issues.
NELSON: What was the date?
BEALES: '92. I realized that there were some issues, but being on the board of CTAM and knowing the marketers, I was confident the industry needed and wanted CTAM. They just wanted it to be a little different. I started at CTAM and I always said that I was going to be at CTAM until the consumer was the center of our business, and we're still working on it but we're getting a lot closer.
NELSON: Well, that's not the end of the story. It sounds like a wrap up here, thank you very much, but from '92 'til now, a lot's happened. So when you got there and you saw some of these issues, okay, they are really issues that are internal to the organization so let's look at how you changed the organization at that point.
BEALES: Well, because of this mile wide, inch deep moniker, I knew that I had to refocus on marketing. CTAM's name stood for Cable Television Administration and Marketing Society, and under the administration side we had a group of HR executives who were meeting under CTAM's auspices. They had a very profitable compensation study that they did each year. So, gosh, we were in financial trouble, but they're not really marketing and so we had to let them go. It caused a little hard feelings but of course CATHRA now has become a very viable organization. We refocused on marketing. We ended up shutting down the database which was a valuable product but just too expensive for our budget. At that time in the early '90s, if you think about what was going on, DirecTV had just launched but cable wasn't paying much attention to DirecTV. We saw a lot of competition coming, and the marketers at both corporate and field said they wanted to get together and talk to each other about this, to strategize. CTAM's conferences just took off and attendance was robust at the, what we now call the Summit. Our Pay-
Per-View conference which ultimately morphed into Digital and Pay-Per-View and Broadband, kept growing. As a result our finances pretty quickly turned around and off we went.
NELSON: So it that one of the fundamental financial underpinnings of the organization?
BEALES: At that time.
NELSON: The revenue from the conferences.
BEALES: At that time, yes, revenue from the conferences was very important.
NELSON: As opposed to a dues structure?
BEALES: Correct. At the height of the conferences, about 2/3 of our revenue came from conferences.
NESLON: That's when you had more conferences.
BEALES: That's when we had more conferences.
NELSON: Okay, so you made these changes in terms of the organization, but what about the focus of how you talked about the consumer, bringing the consumer to the center of attention, how did you go about doing that? What were some of the first steps you took because the consumer at that time was really kind of a second thought for a lot of people – "we have our product, that's it. Take it or leave it."
BEALES: Right. Well, we focused CTAM on research. I created a research department, replacing the all volunteer band trying to produce this research. I recruited Grace Ascolese to come in and start our department. So we started producing more research. While some of the big MSOs had research in corporate, it never trickled out to the field. Those marketers out there were flying blind. Giving field marketers a lot of information about what consumers wanted and would pay for was pretty huge. The other step that we took was to partner with NCTA after the industry had been re-regulated, and we had a peck of trouble in Washington. Decker Anstrom had assumed the presidency of NCTA, and we partnered on the On-Time Guarantee, which was really all about convincing consumers that we were a different business. Cable as there to serve them and we had to market that fact. And so, we partnered with them for a couple of years and that was a very productive relationship and really set a standard for a long-term partnership that we still have today.
NELSON: Where did the concept of that originate because I really saw that, from my perspective, as a really turning point at that time where the industry really came out and said, "Consumers – we're really here to serve you."
BEALES: The credit for that goes to Time Warner Manhattan. Time Warner Cable Manhattan and their agency Shepardson Stern and Kaminsky created the on-time guarantee, tested it, and had some very clever, funny advertising. It worked in New York and so NCTA – Torie Clarke was then leading the NCTA communications department –said, wow, this can work nationally. Bob Miron on the board said, "Gee, I think this is something we can all get behind. I'll take the job of persuading all the cable companies to offer it." It was enormously controversial, as you can imagine, and so statesman Bob got out there and got people on board. CTAM brought the marketing powers from the networks as well as the MSOs together to work on the advertising and how we were going to communicate it and offer it. So there were a lot of people involved, but I still think that Time Warner Manhattan and Torie Clarke really were the key architects.
NELSON: And then it spread from there because I think that really was a big turning point, and not only from the consumer but also there was another message sent to the FCC about where cable was coming from.
BEALES: Correct, correct.
NELSON: How about other initiatives at that time?
BEALES: Those were really the ones that are the big standouts. Fast-forwarding, CTAM goes along until probably about 2000 on this model and it's great growth every year, things are going well. But as satellite competition got stronger and the industry realized they were up against national competitors with more coming down the pike, at CTAM we said, well, gee, there's more that we can do to help the companies. Cooperative marketing is the next logical step. Cable had a real asset in CableLabs creating the Go to Broadband database, which for the first time let the industry be able to share leads and marketing information on a consumer based approach. We then co-operated on G2B Movers, a program that allows a customer who is disconnecting from a cable system because they're moving to be transferred, using their zip code to the next cable system to arrange installation. That's a pretty huge step forward, and our Mover programs have continued to grow. We've adopted additional tactics over the last eight years. This year we won the bidding process for the U.S. Postal Service mover products. They have a Mover Guide, a Mover Guide online, and then you get a Welcome Kit after you put your change of address in. CTAM, on behalf of all the MSOs, bid in that process and won the right to advertise video in the entire country, which means that we pre-empted the RBOCs from advertising video anywhere in the country in those products. We won the right to advertise the triple play in sixteen major markets and another eighteen of the smaller markets. CTAM is administering all of that. Now that we have the program in place now we have to administer the creative, which means we funnel all the creative from those MSOs through CTAM and back to the company administering. The US Postal Service only wanted to deal with one entity so CTAM's involvement was pivotal. So Movers is a great example of cooperative marketing, but we have cooperative marketing going on in lots of other areas including commercial, and integrated communications and in retail. We have the On-Demand Consortium, which serves programmers as well as suppliers who are working together to try and move that category into a bigger success faster. This whole cooperative side of CTAM has been building over the last eight years and is now well more than 50% of our resources.
NELSON: And you really say that it's the thrust of what you do now, if you ever really try to characterize your organization?
BEALES: We're still a hybrid, so we serve individual members with the education and we serve corporate members with cooperative marketing. So far it's working to do both.
NELSON: And I suppose educating the individuals really in the end helps the corporate members, obviously.
NELSON: But looking at that education, I think that maybe there was a sense way back when that the conferences, the attendance was growing but was the content... how relevant to people's day-to-day jobs was the content? I know that's something that you really tackled.
BEALES: It's a real battle when you have the competitors in the audience. People are not going to open the kimono as much as they used to, so we've tried some other ways to produce education. One that I'm particularly proud of is what we affectionately call CTAM U – CTAM's Executive Management Program. It's an executive education course. We've been at the Harvard Business School now for nine years, started at Northwestern with Kellogg and Medill for three years, so it's a well entrenched program CTAM U is true marketing and management education for the rising stars of our industry, and that's been very successful serving in one market. We also have a vibrant network of chapters serving more the field and middle-management market. So you have to come at education in lots of different ways.
NELSON: Now, with these other activities going, how does the Summit, your main event, how does that play into that?
BEALES: The Summit's the crown jewel in our calendar. It's the annual gathering place for marketers. We aim to provide high level insights from speakers from inside and out of cable. We've been able to capitalize on this great, deep relationship we have with the Harvard Business School and bring in Harvard Business School professors for a broader audience. Our members also use the Summit to share info informally. It's called networking, a practice that always had a funny connotation in this industry. The opportunity to compare notes that work is a pretty powerful resource. Meeting people that you can share information with is still a fundamental benefit and a unique marketing asset that cable has. Anyplace else, marketers in a company compete with other companies. They can't share information. In cable we can share information so we should take advantage of that and CTAM's really built on that.
NELSON: What about in terms of you talked about sharing information and the competition, how did you wind up dealing with that issue?
BEALES: There a lot of closed door meetings going on and a lot of hallway chatter.
NELSON: So you can't really keep them out altogether, obviously.
BEALES: No, no, in the U.S. we have these laws, these anti-trust laws.
NELSON: Yeah, Teddy Roosevelt and all those people – what did they know! But there still is an opportunity because people are there, they're gathered in the same place that they manage to have their meetings.
NELSON: So what would you say in summary about your career at CTAM at this point? It still goes on, of course.
BEALES: Indeed. We're not done yet, we're not done yet.
NELSON: You've really become synonymous with the organization.
BEALES: Well, CTAM's way more than me.
NELSON: It is, but your leadership is certainly so recognized. You've been there a long time and the organization has changed so much in that time period in terms of what it does, what it focuses on, the whole notion of bringing the consumer to the center of it – a little chance to sort of reflect here.
BEALES: Like any organization, we are here to serve the companies, and their employees. That's why we exist, and so as our member companies business changes it's only logical that we'll continue to change. I think that we're about to enter the most exciting time for marketing in cable, on the cable company side, in our history. We have recognized that marketing has to become much more sophisticated and specialized. The companies are putting their resources behind it, and so it's extremely exciting to watch the chief marketing officers work together to create a national footprint to compete with big competitors. That's very exciting and I think there's a lot more that we can do there. On the network side, of course those marketers have been among the most sophisticated brand builders in the world...
NELSON: For a long time.
BEALES: For a long time, and they're pretty darn good at getting people to watch their shows, too. So serving the programmers needs through the Television Critics Tour, for example, or the On-Demand Consortium is CTAM's role. We work on these new products where they're still trying to puzzle the business models out, whether it's Tru2way or advanced advertising, there's a lot that they can do together. I think it's time for programmers and suppliers to have a home at CTAM, too. The story of CTAM has a lot to go before it's written.
NELSON: And we hopefully are likely to see you as part of the story?
BEALES: It's a pretty wonderful industry. The job isn't done. There's just so much upside, that we haven't even talked about... we still talked about programming but of course as cable's broadened the product array into telecomm, high-speed internet, phone and commercial. There is so much upside for cable. We've got the best plant, we've got the best products, and now it's up to the marketers to let consumers know about that.
NELSON: You mention those products – now that you're dealing with more technically based products as opposed to programming. You're dealing with internet, you're dealing with phone – how has that affected the organization, the skills that you require, and in fact, how you work with the MSOs themselves because you're dealing with different kinds of people there.
BEALES: Well, you know, it's interesting. High-speed internet was a difficult product to sell because consumers didn't know that they needed speed, they didn't quite know what they were getting. Phone, interestingly, has been a relatively easy product to market because consumers know what a phone is. You don't have to explain what a phone is. So it depends on the product how much attention and cooperative marketing you need to engineer depending on how difficult it is to sell. Where I see a lot of growth for CTAM in the near-term future is in business services because a lot of small and medium businesses don't first think about cable as a provider. We've got to get cable in the consideration set. We've been really ramping up to provide more services in the quest to sell cable to business. Last year we produced a master service agreement that all the MSOs bought into because businesses aren't organized along cable franchise lines. To sell to many businesses you have to involve to or more different MSOs. We coordinated getting this master service agreement in place so that there can be a quick signature and you can get back to that customer and close that sale rather than delay for having to try to work out what the deal is going to be and who's going to sign on. Things that we can do that will facilitate selling cable to business I think will be a big part of what we do.
NELSON: And how is business responding to that?
BEALES: Excellent, a lot of growth. If you look at the earnings numbers from our MSOs there's a lot of growth in selling cable to business.
NELSON: And just getting back again to the technology issue, has that required you to bring in or gain other kinds of expertise?
BEALES: Absolutely! We've had a goal for the last decade of bridging marketing and technology as they get together to introduce new products, so absolutely we've needed more sophisticated expertise. Leslie Ellis is our technology adviser and really helps us. Dick Green sits on our board from CableLabs. We're brought those people together to educate the marketers and to educate the technologists; it's got to be a two-way conversation. So, yes, we've been in the middle of that and I think we're going to stay there for a long time.
NELSON: And do you think that relationship and that two-way exchange will benefit from the fact that going down the road, not this year, but in subsequent years, that actually the SCTE's annual cable tech expo and the Summit will actually be same place, same time, or overlapping times?
BEALES: Absolutely, along with CableLab's summer conference, absolutely. Bringing those two groups together would make all the sense in the world.
NELSON: So just give us your last thoughts here – overview cable, the future, opportunities, pitfalls.
BEALES: Cable has enormous opportunity. We've got this rich network that is serving consumers throughout the country. We've got a great video product with lots of cool enhancements. We didn't even talk about HDTV, On-Demand, DVR – consumers love cable because we gave them choice in the beginning. Cable really was the industry that got them choice, but now they have convenience and they have control, and cable has put that menu together. We've got formidable competitors which are only making us better as we go to market. We have lots of upside in new areas like interactive, the Tru2way, advanced advertising, business services. There's so much that we have yet to do in this business and it's exciting because marketing is the engine that's going to drive the train going forward...we're always going to be a technology-based business but it's really time for marketing and it's exciting to be a marketer in this industry. For me it's exciting to get a chance to work with these extraordinary marketers as we go forward.
NELSON: And then what's the biggest challenge that you're facing in taking advantage of all that?
BEALES: The biggest challenge is still bringing all the right people together to make things happen. Sometimes that means that we've got to bring our technology partners, we've got to bring our communicators and PR people, finance, we've all got to get together and really focus in on serving the customer. We have to put the customer at the center of our business. We're getting closer every day, every year, and our success will depend on it. So I've got to keep working on herding those cats.
NELSON: Okay, Char. Well, thanks very much for joining us and thank you for watching. This is Steve Nelson for The Cable Center and our Oral and Video History Program. Thanks.