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Ray Joslin

JoslinRay

Interview Date: Wednesday August 01, 2001
Interviewer: Jim Keller
Program: Hauser Project

Raymond E. Joslin, former president and group head of Hearst Entertainment & Syndication and senior vice president and member of the board of directors of Hearst Corporation, died on Friday, August 2, 2013 in Greenwich, Conn. The cause was stomach cancer. He was 76.

KELLER: This is the Video History of Raymond E. Joslin, President of the Hearst Entertainment and Syndication Division of the Hearst Corporation. He is also Senior Vice President and a director of the parent Hearst Corporation. Ray is a pioneer. He's been involved in the industry for almost as long as the industry has been around. He has a great background. He's also a Cable Pioneer, and I want everyone to realize that this history is funded by a grant from the Gustave Hauser Foundation and is part of the Oral and Video History Program of the National Cable Television Center and Museum. Ray, give us a little bit about your background, prior to the time you got involved in the media business.

JOSLIN: Well, I was born in Massachusetts and grew up in Rhode Island and went to college in Connecticut. At that time and at my age, I thought Syracuse was in the mid-west. Little did I know that later I would know exactly where Syracuse and many other places were. I got out of Trinity College in 1958 and went to work for Jones and Laughlin Steel Corporation. J & L, at that time, was the third largest steel producer in the world. This was well before foreign competition really began in that business. I had been selected, kind of as a guinea pig, to find out whether or not a brand new sales trainee out of two years of training, both in the mills and taking metallurgical courses and working as an inside sales correspondent in Indianapolis, could in fact, take on a position of responsibility. So I was selected and given a territory that, at that point in time, did about $40 million in gross billings per year, primarily with some of the OEM manufacturers, automobile manufacturers and parts that go into automobiles, and was stationed in Findlay, Ohio. I ran into my next door neighbor Irv Grousbeck. Irv Grousbeck and Amos Hostetter were, in fact, the founders of Continental Cablevision. I began to talk with them about cable and over a period of time, and beginning on Sept. 1, 1967, I joined that company. There were only five of us at the time, Irv, Amos, me, an accountant and a secretary as we began our first venture in Fostoria, Ohio. Irv and Bud and I sat at the Green Mill Country Club one August afternoon in 1967, and shook hands as partners in this new venture. Of course, everyone that I knew, including my mother, thought that I was absolutely nuts. I mean, why should someone my age who has a good job with a major company, a company car, a retirement program and whatever, why should I be so foolish as to give all that up and go into this business that no one knew anything about at that time. So we began.... It's a very interesting story, I think, that the listeners or readers would be interested in. Irv and Bud really conceived the idea of Continental Cablevision at the Harvard Business School and spent many evenings in Boston in their apartments drawing 35 or 50-mile circles around the television stations in New England, the thought being, at that point in time, ...

KELLER: A difficult job.

JOSLIN: Yes, right... that any community that had three or more television stations available off air with a roof-top antenna, was not a candidate for cable television. So when you draw a 50-mile radius around Boston and Springfield and Providence and New Have and Hartford and New York and Philadelphia, you quickly find out that there was no territory in the east, the northeast, for cable television. Of course, Pennsylvania had already been, or was being developed by the Rigas' and the Barcos and whomever else, were engaged in the retransmission concept of providing mountain or rural communities with television that they couldn't receive without a tower and wires carried throughout the community. Almost in desperation, they decided upon Ohio and capitalized the company with $2,000. Irv Grousbeck flew to Cleveland Hopkins Airport, rented a car and went to Mansfield, Ohio and essentially pretended, and you couldn't get away with this today – you'd wind up in jail, that he and his wife were going to be moving to Mansfield and that his wife was a television addict and could he please come in to 50 homes and look at the television reception that they were receiving with a rooftop antenna. He was allowed to do so. Remember, this is back in an earlier time. He concluded that Mansfield was not a cable television town and, of course, the Horvaths and the newspaper there built a huge and very successful cable system later. He then drove to Lima, Ohio, and he ran into a couple of interesting people - Bruff [George E.] Hamilton who was the owner of the Lima television station, WIMA, channel 35 and [George] Quatman, I can't remember his first name, who owned a private telephone company in Lima. He realized he was up against Cox. Cox had already contacted Hamilton and Quatman, made them partners, and they had an application well in progress in Lima. He then drove north about 30 miles to Findlay and ran into the same crowd. The Cox people were there and so, almost in desperation, on his way back to Cleveland Hopkins Airport, he drove into Fostoria, Ohio. Now Fostoria, at the time, had a population of 7,500, let alone 7,500 television households. Over a period of time, he made an application on behalf of Continental. They were successful in getting the Fostoria franchise and then adjacent to that, probably 15 miles away, was Tiffin. So the first two systems were then built with a tower in between, a 500' tower, at Bascom, Ohio. So that was the beginning of the company. The first office of the company was an abandoned hardware store on Main Street in Fostoria, Ohio. You might imagine what that was. We can all picture it. It's an empty store with a 30' frontage on Main Street and probably 60' – 70' in depth. At the back of that empty store, we had a counter, and we had two offices. Our customers, as few as they may have been, walked the 65' through nothingness to this rather stark, and not terribly professional kind of a business environment.

KELLER: Why didn't you put the counter up front?

JOSLIN: Well, that's a good question. The offices were back there and there were only five of us. We all had our own assigned tasks. We worked hard, negotiated a deal, interestingly with Cox, ...

KELLER: This was prior to the time that you joined the company?

JOSLIN: No, this was after I joined the company. I joined on Sept. 1, 1967 and this would have been right at that time. We negotiated a deal with Cox with respect to the Findlay system. Cox was convinced, and Bill Pitney was then the new general manager, that Findlay would top out with about 5,000 to 6,000 subscribers. So we entered into an agreement with them whereby we bought 50% of the system and had the right to acquire the other 50% when the Findlay system passed, I want to say, 6,000 or 7,000 subscribers. Which we did.

KELLER: Passed homes or subscribers?

JOSLIN: Subscribers. Within a year to a year and a half we were over 10,000 subscribers. That little cluster of systems really began, or were the beginnings, of Continental Cablevision which went on to be the third largest cable company in the industry.

KELLER: And you were president of the Ohio operation.

JOSLIN: Of the Ohio operation. Shortly after, probably in 1968, Irv left to move to Quincy, Illinois to establish a nucleus there, franchised the Quincy, Illinois franchise and Keeokuk, Iowa. Bud, as we called him then, now Amos Hostetter, moved to Boston and established what were on Lewis Wharf, the romantic office facilities that were built on a wharf that actually slanted. I mean, something would roll down your desk because of the slant and the condition of this old, old, old wharf that had the pilot house. As a matter of fact, Thayer, Janet Thayer, who was Amos's secretary assistant for many years, could literally lean out the window and talk to the lobster fishermen as they were docking their boats. They'd throw up lobsters, up through the open window, into the office. It was a very romantic place. We then commenced franchising throughout the state of Ohio. We had a very interesting and dedicated group of people. I think we won some 30 franchises without losing one. The one we lost was to you.

KELLER: Yes.

JOSLIN: Describe the circumstances under which you took that franchise away from us?

KELLER: We had a better proposal.

JOSLIN: It was Delaware, Ohio, which is not a huge metropolis at all. It's a town mostly of Ohio Wesleyan University and many retired people, about 30 miles north and west of Columbus. We had been there. We had convinced the council, the city council, that we were the right company for the franchise. In Ohio, under Ohio law, a franchise has to have three readings. We had had two of those three readings when Doug Dittrick, who was then the president of ATC...

KELLER: He was Vice President, Operations.

JOSLIN: ... Vice President of Operations for whom you worked at the time. His mother lived in Delaware, Ohio. She called the city council, and she said, "How dare you give this franchise to anyone other than my son and his company." So in you waltz, the following week, with a proposal. They suspended the readings, the third reading of our franchise, and you then got the franchise because of Doug's mother.

KELLER: That's right. That's right.

JOSLIN: And so I think that was the ...

KELLER: That's how franchises were won in those days.

JOSLIN: Exactly. That's how. That was our first loss. We had an interesting regime and some interesting people who came through Findlay, Ohio, people who are now in the business, and are well-recognized. Clearly, Bob Classen who went on to become president of Comcast for a period of time, worked with us in Findlay. Jim Robbins who is the president of Cox....

KELLER: I'm doing Jim next week.

JOSLIN: Are you?

KELLER: Yes – looking forward to it.

JOSLIN: Barry Lemieux who founded, with Steve Dodge, American Cablevision which was later acquired by Continental - he was my Fairborn, Ohio manager; even Jeff Marcus, who today is so well-known. His fledgling company called Mar-Kitt, Marcus and Ben Ketay, which was a door-to-door sales activity, conducted our door-to-door activity in Findlay, Ohio. People like Tom Willett who was very effective in marketing and creating new marketing ideas for the industry; several other people. And we had an interesting regime. We really, I think, were one of the first to develop the multi-media franchise approach where we'd actually use both film and a bank of Kodak slide projectors, synchronized with music, to show the wonders of cable television from Gorgeous George live from Chicago, the wrestling .... And it was quite effective.

KELLER: Did you have a studio there at that time for film chain and other things necessary?

JOSLIN: Well, we did that. Findlay had, and was really a pioneer.... Continental always took very seriously its local obligations. We always told our managers that we want you to live on the cable system in the town. We want you to be part of the little league if you have kids, attend church or synagogue or whatever, become an integral part of the community. Clearly, when you had to go for a renewal of a franchise or then for a rate increase, if you were integrally involved in the community, you were going to your neighbors rather than to strangers for this kind of approval.

KELLER: That was the philosophy of the telephone companies back in those days – you were involved in everything.

JOSLIN: Exactly. Exactly. So we created a service called CTV3. We bought a brand new RV, and we equipped it as a floating control room. It had film chain. It had tape machines. It had a full broadcast control room. We proceeded to tape, and did some live, high school football games, basketball games. We created children's programming called "Just Imagine" which won several awards at the NCTA at that point in time, before they were called ACES. We did city council meetings. We did the election returns. It was a very, for it's time and place, reasonably sophisticated mini-television station.

KELLER: You were the first one to use a mobile man, I believe.

JOSLIN: Yes. I think we were. I think we were. And then later, when I went out to California in 1972, we did the same thing out there. We called it CTV5 and, in that case, had a similar van equipped. We'd do the University of the Pacific football games, city council, much of the same kind of diet. We bought films with Leo Horty at Buckeye Cablevision in Toledo, and we'd bus those films up and down I-25 on the greyhound bus. We telecast such great classic films as "Casablanca". It was pretty elementary, but it was very effective.

KELLER: We all went through those days.

JOSLIN: We had an interesting regimen...

KELLER: I'd like to go, just a little bit to Continental had a little bit of different philosophy of their management where they were decentralized almost entirely. Each of the local managers was, pretty much, autonomous. Was that correct?

JOSLIN: Yes. The philosophy of the company was that, with the exception of finance, that what we were doing was essentially a regional activity. This follows from what I mentioned earlier about being part of the community. But essentially, each of the regional or general managers or system managers were very autonomous with regard to the marketing, the advertising, the promotion, the pricing in their particular community, and were held totally responsible for their P&L. So the reward was very entrepreneurial.

KELLER: Base your own budgets.... Did you make your own budgets and then do it with the company?

JOSLIN: Your own budgets and then submit them, every year, to the company for approval. Your reward was not only your compensation, which was reasonable but modest at that time. The real reward was the stock grants and options that people were given over a period of time. Just a week and a half ago, finally, all the Continental shareholders who moved into MediaOne stock were then exchanged for AT&T stock, some after a 35-year holding period. That's been quite substantial for those who really contributed to the efforts of the growth of the company.

KELLER: Did you ever try to determine what the basis for you stock would be if you ever sold it?

JOSLIN: 0. I mean, really, I'd call it a dollar, but it's somewhere between 0 and $1.

KELLER: I had the same problem with the Time, Inc. stock – never knew what the basis was.

JOSLIN: Yes, exactly. So there was a regimen really created there among these very, very talented people. We all had our jobs, either as a manager of a system or whatever. But at about 5:00, 4:00 in the afternoon, we would pack up two station wagons in Findlay and then when the van was available, it too. And we'd drive for two hours down to the Dayton area. Monday night was Fairborn, Tuesday night was Xenia, Wednesday night was West Carolton, Thursday night was Kettering or whatever else. This went on for a period of probably 4-5 years. You just don't walk into a city council and say, "I'd like a cable franchise." I mean, city councils, at that time especially in these smaller communities, knew everything there was to know about 30' wide of asphalt by 2" thick by 1 ½ miles long. But they knew absolutely nothing about cable television. So they would always place our item last on the agenda. I always insisted that we sit there for the entire meeting. So we'd get to the meeting, which normally began at 7:00 or 7:30 or whatever. We'd be taping it because we had the van there which was wonderful. It was amazing to see how city council people would, all of a sudden, come to the meeting in a tie and a jacket.

KELLER: Mind their manners.

JOSLIN: Mind their manners and whatever else. And so it was impressive, and it was ego-appealing as well. We'd sit there sometimes till 10:00 before our item would come up. And that would go on for 1 ½ hours, and by the time we packed our stuff up and headed back up for the 2 hour drive back to Findlay, it was 11:30 and we'd get back home at 1:00 am or later. The next morning we'd go back and be on the job doing whatever our job was, day job if you will, by 8:30 or 9:00. The next afternoon at 4:00, we'd pack up the same things and go to the next town. It was very interesting, and it was very rewarding. As I say, I think we franchised probably 35 – 40 communities in that manner.

KELLER: How many subscribers did they end up with in Ohio?

JOSLIN: End up with in Ohio – oh, boy. I don't know the answer to that question. Clearly, I think when they were sold to MediaOne, Continental had just under 5,000,000 subscribers, about that. I have no idea. Of course I was with Continental from 1967 to 1979 or thereabouts, so while I was a shareholder, and I constantly got reports, I don't know exactly. I do know one thing. I did this because I had to give a speech on this subject – it amazed me but in 1965 there were only 2,000,000 cable subscribers in the United States. Unbelievable. I didn't realize that the industry was that tiny, that small at that time.

KELLER: There wasn't a public company until '69. Was Continental before that?

JOSLIN: Continental was never public.

KELLER: That's right.

JOSLIN: Always private. Never public.

KELLER: That's right. There was not a public company until 1969 when H&B American ...

JOSLIN: H&B. I was going to say H&B American.

KELLER: ... and ATC – they both went at the same time.

JOSLIN: Yes. The philosophy of Continental was there are only three reasons why anyone would want to be public. One is in order to get investment capital to expand and build your business. That was never a problem for Continental. Continental had outstanding relationships with all of the banks. One thing that was engraved in our brains and bodies was that we will never fail a commitment to the bank. We will never fail to meet our projections that we have given to the bank in support of the money that they were able to loan us.

KELLER: Were each of your operations, as an example – yours in Ohio, were they financed individually or financed through the corporation?

JOSLIN: Generally, because of the way the company grew, they were individual. At one point in time, all that existed were three little system sin Ohio. All of a sudden, Keeokuk, Iowa and Quincy, Illinois and East St. Louis and whatever, were acquired at different times, the franchises or the acquisition of someone else's system. Generally speaking, and perhaps toward the end (by end I mean the 15 years that Continental went on after I had left), I'm sure there was a lot of consolidation of debt. That would only make sense.

KELLER: Did they use some of their other systems to guarantee the loans for the Ohio operation or after that, the Ohio operation to guarantee the loans of other places?

JOSLIN: Generally speaking, our objective, and we were very successful at it, was to use the assets for which the loan was obtained, as the security against the loan. That may have changed, as I say, in later years where, in fact, loans were consolidated and whatever. Clearly, Continental was a healthy and wonderfully cash-generating company. It did not want to go public because the bank was your best partner. If you did your business right, and you achieved your objectives, you could pay off the bank and he went away. A partner doesn't go away. Okay? Another reason why Continental felt it should not be public is that no one was interested in cashing in. Continental, amazingly, set a track of owning a property as if was going to own it for the next 250 year. It did very little horse-trading that went on in the business. Certainly, perhaps, beginning in the 80's when the consolidation and the clustering began in the industry, just for economies of scale – and that is that cable operators traded systems that could give them cluster in their area and by the same token give another cable operator a greater number of subscribers in a cluster in another area.

KELLER: That didn't really get moving until mid-80's, I would think.

JOSLIN: Yes, exactly. And so I think we prided ourselves in, at least through 1980, of never having sold a cable system. I think that was a wonderful track record. I think that people believed the credibility of the company. We had then been in business for, call it 15 years or thereabouts, and where others had traded systems or sold systems or entrepreneurs had sold systems to companies that were getting larger, we had never engaged in that. And I think that was good, and again, I think, led to the credibility of Continental in the investment banking and lending community.

KELLER: When did you start buying systems as opposed to building them?

JOSLIN: We bought, when I was in Ohio in 1968 or 1969, we bought the Jackson, Michigan system, and we bought the Holland, Michigan system.

KELLER: North of Toledo.

JOSLIN: Yes. Those were reasonably major acquisitions for a company our size at that point in time. Later, of course, into the 80's and 90's they bought systems all over the country from different operators and ...

KELLER: I understand that.

JOSLIN: ... consolidated them. Those are the two I recall. For the most part, we built our systems. We built them from scratch. The right way to do it to maximize your investment is not pay a premium for someone else's problems. You can create enough of your own problems.

KELLER: Like a used car.

JOSLIN: But at least you get the premium if, in fact, there's going to be a day such as the MediaOne acquisition or the AT&T acquisition where, having done that, has been very rewarding to the investors in this company.

KELLER: Then you left Ohio and went to California with Continental?

JOSLIN: Yes. We started in 1967 trying to obtain the franchise for the City of Stockton and San Joaquin County surrounding Stockton. Stockton was located about 65 miles due east of San Francisco, maybe 40 or 45 miles south of Sacramento. It's in the Great San Joaquin Valley. We began in 1967 in an attempt to get those franchises.

KELLER: It's a big city.

JOSLIN: It was. It was our major construction of the time, no question about it. And we, over a period of thee years or four years, we were able to get the doughnut – namely the county, San Joaquin County. But the hole of the doughnut, located square in the center, was Stockton, and we didn't have that franchise. You couldn't efficiently build the doughnut without having the hole as well. So we made a concerted effort, and in early 1972, we got the City of Stockton franchise. I wanted to, and volunteered to go, head up that project plus other franchising on the west coast. On Sept. 10, 1972, I packed my bags and left Findlay. My wife and young family at that time, moved to Stockton, California. At that point in time, Chuck Younger, who had been with the company in Quincy, Illinois, then moved to Findlay and then essentially took over Continental Cablevision of Ohio. The San Joaquin and Stockton system was interesting. It was one of three systems that were being built simultaneously that were presumably state-of-the-art.

KELLER: This was '68?

JOSLIN: This was '72. We were dual cable, bi-directional. [Austin] "Shorty" Coryell at ATC in Orlando, was doing it at the same time we were, as was Al Gilliland in San Jose. The whole concept was, well if one cable can carry x number of signals - and hopefully an unlimited number of signals in the future when some box or another would finally be developed - if one cable worked, two cables were better. But it really was an engineering challenge because to string double cable up on the telephone poles required a whole new set of cable ...

KELLER: Reels and tools.

JOSLIN: ... reels and tools. We convinced Pacific Gas and Electric Company, who owned the power poles in Stockton, that instead of mounting the amplifies up on the cable, which was generally the case – maybe 2' – 3' from the pole – that we would bring the dual cable down the pole to about 9' off the ground and we'd mount this double amplifier which was pretty substantial ...

KELLER: You were using SKL at the time, weren't you?

JOSLIN: No. We were using EIE, which later became RCA.

KELLER: Okay. I wasn't aware of that. I thought with the Boston connection you may have been using ...

JOSLIN: No. EIE, which was later RCA. And we built, I want to say – hope I'm not too far off – probably 1,200 miles of dual cable in the city of Stockton bi-directional. The logic there was, now with the development of two-way amplifiers, that you could pass a signal not only in forward direction to a subscriber's home, but you could take a signal from a subscriber's home back to a central location. Unfortunately, the engineering of it was perfect in the forward direction. The maintenance of the reverse half was nuts. But it was the best that we knew how to do at that point in time. We had a unique problem in Stockton. Under the FCC's Report in Order, where there were 22 or 23 television stations from Sacramento and San Francisco that put what we call a grade B or better signal over Stockton – meaning that with a reasonable sized rooftop antenna, you could get 23 channels. The only channels that we were allowed to carry were the Sacramento stations.

KELLER: I remember that very well. New England and California were ...

JOSLIN: Exactly. And it was a severe marketing challenge because we were, in essence, providing, for a fee, less than what people could get off their rooftop antennas for free. It highlighted even more than the CPTV activities where we were doing local high school and college sports and local programming and city council meetings .... Clearly, the cost of that was far greater than the benefit, without question. That system languished for quite some time.

KELLER: All big market systems at that time were languishing.

JOSLIN: Absolutely.

KELLER: Some in Orlando, some of the others that I was involved in.

JOSLIN: Yes. They were the first, if you want to call them, metropolitan markets. Stockton was a sizable city. Stockton and San Joaquin County were probably 500,000 – 600,000 people or whatever. For cable, at that point in time, cable hadn't really become very urban. It was now becoming suburban, having been essentially a retransmission and rural service in its early beginnings.

KELLER: When were you able to bring in some of the San Francisco signals. I'm sure they were desirable. They were out in the valley.

JOSLIN: They were. We argued the foreign language thing because there were foreign language stations that shouldn't be denied to this community that had Spanish speaking viewers. I think finally.... I forget exactly when that happened. I think it was in the late 70's or maybe early 80's - it might have been '78 or '79 - when finally the copyright bill was passed. You then had a distant local signal concept where you filled out a form and you computed what your copyright payment was for your distant signals. In effect, the concept then, was that we weren't stealing the signal. In fact, we were paying the copyright tribunal.

KELLER: Only to a point though. You could only carry so many of them that the copyright was limited.

JOSLIN: Yes, right. Exactly.

KELLER: It was a difficult time for the industry.

JOSLIN: The other thing that happened – I had almost a battle royale with someone you know but I won't mention him. Anyone who's watching knows, probably, who I'm talking about. It was at a Cable Pioneer cocktail party or dinner a few years back. I walked up to this fellow who founded and was no longer, the owner of a top 10 cable television firm. And I said to him, "Isn't it great how the cable operators and the cable programmers have worked so well together to build this wonderful business," keeping in mind that cable programming began in the late 70's, early 80's. He turned to me, and he said, "That's ridiculous. You programmers owe your entire existence to the cable operator." I said, "Wait a minute. If I remember my history right, I think that there were in 1975, probably on the order of 25,000,000 cable subscribers around the country. Here it is 1997 or whatever, and there's 65,000,000 cable subscribers. I have to believe that exclusive programming that was created in the late 70's and 80's and now 90's has a large impact upon attracting those subscribers."

KELLER: There's no doubt about it. The major market systems didn't go until HBO came on the satellite.

JOSLIN: Yes, exactly. And so my cable brethren, whom I've known and loved for 30+ years do tend to take that position because it's a convenient position to take when they beat up now on the programmers in terms of our fees, our subscriber fees. It was a real challenge, but clearly in Stockton, something interesting happened, as well. I believe that the Cable Hall of Fame should really include Jeff Nathanson.

KELLER: Unquestionable.

JOSLIN: Jeff Nathanson was the founder of Channel 100, which in effect, was the first pay television service. I can remember, on behalf of Continental, going around and visiting with Henry Harris and with Doug Dittrick, then senior members if not presidents of their companies, and saying, "I think we ought to form a consortium or company to develop pay television." And they said, "No. Here's this guy, Jeff Nathanson who's willing to come to your community, spend the money - the marketing money and administrative money - and spend the money on the boxes that go into our subscriber's homes and he'll give you a percentage off the top of the revenue. Why should we do that?" I said, "We should do it because we have the opportunity to really develop that business for ourselves." So Jeff came to Stockton. It may have been one of his very first, I think, systems. He established his own offices in offices that we rented to him in our facilities. He engaged his own administrative and billing staff, his own sales staff, his own inventory of boxes, and we were in the pay television business.

KELLER: Was it a multiple channel box? I don't remember that operation too well.

JOSLIN: It was a single channel box.

KELLER: Was it in conjunction with your converter or didn't you have converters at that time?

JOSLIN: We had converters. It was in conjunction with our converter, yes. The other guy out there that was developing this was Dorry Sherry, from Hollywood. He had a card concept whereby you'd buy a debit card, I guess, through the mail ...

KELLER: And then Sylvester came in there and blew the whole thing up by losing it in California then after that. He should never, never, never have lost that. Never.

JOSLIN: Clearly, Stockton was very much of a pioneer system, both technologically, I think in terms of the challenge of the marketplace of wanting to provide our subscribers with everything that was unique and private – namely the cable networks.

KELLER: Out of necessity, too, wasn't it?

JOSLIN: Absolutely.

KELLER: Not only by desire but out of necessity.

JOSLIN: Absolutely. We had to have something to sell. We had to overcome the marketplace problem is what we had to do. So those were essentially where I was with Continental. I spent, I guess, 1967 – 1980 with Continental. I got very enthused about the advent of another side of this great business and that is the software, the programming side.

KELLER: Before you do that though, you were president of the California Association in 1981?

JOSLIN: '81. Yes.

KELLER: That was an interesting time for the California Association.

JOSLIN: Yes, it was.

KELLER: Do you remember any of those things?

JOSLIN: Do I remember! Clearly, the California Association was, and I think still is, the largest state or regional association in the country.

KELLER: And the most active.

JOSLIN: I think I was president for two years, I'm not sure. '81 for sure, but I think it may have to '82. Right at that point in time, we were attempting to pass through the state legislature AB699. AB699 was essentially a deregulation bill. We had a litany of horror stories in California where the city of San Diego and other cities just ignored the cable operators' application for a rate increase, just wouldn't even consider it. I believe San Diego is a good case in point. If I remember correctly, I think they probably, over a 4 or 5 year period, had submitted maybe 4-5 requests to the city council for review of the cable rate.

KELLER: We were operating ports in San Diego at the time. I remember it very well.

JOSLIN: And they just ignored it. So there were some real bad experiences with respect to local regulation of cable television.

KELLER: Pete Wilson, I think, was city attorney in San Diego at that time.

JOSLIN: I think you're right.

KELLER: He went on to become governor. He was tough.

JOSLIN: Yes. And we had Jerry Brown as the governor and Gray Davis was the secretary of state. The association with such great leadership, not only Spencer Kaitz but people like Gail Oldfather and John Goddard and there was a whole nucleus of us who really saw the emergency of the situation and also saw the opportunity.

KELLER: Jacoby was part of that group too.

JOSLIN: Gene Jacoby, Gene Cook, Ed Allen from Western Cable. I don't want to miss anyone. If I miss somebody it's just not intentional.

KELLER: Was Lee Druckman involved at that time?

JOSLIN: He was involved. Drendel was on the board. We had both manufacturers and operators on the board. Spencer was really ... his famous "call to arms".... We could summon 30 – 35 senior members of cable management in their companies to Sacramento on a 24-hours basis. We marched the halls. And we lobbied in the finest sense of lobbying. The California Association passed the first deregulation measure ever enacted by a state legislature, and it paved the way for deregulation that took place nationally in 1984. So it was a wonderful effort of a group of people that were smart, dedicated, willing to spend the time and effort, roll up your sleeves, be good lobbyists on behalf of their industry. We did establish the foundation, which I became vice chair of, which was the Foundation for Local Origination. It was for public service programming. The Foundation for Public Service Programming where the cable operators agreed to pay $.50 per subscriber per year into this foundation which would then equip pro bono groups in communities across the state of California with equipment and the ability to be able to put their message on cable.

KELLER: Masterful. Because that was really a big burden for cable companies – made the promise to provide all this equipment and at that time it wasn't used.

JOSLIN: Right, right. It also fixed ...

KELLER: Harry Butcher. I was trying to think – that's the name I was trying to think of from Santa Barbara. He was very much involved and of course he had the political connections to do an awful lot of that.

JOSLIN: We knew all the assembly men and senators, the important ones, almost by first name. We were that close to them during that period. It was very intensive, like two year period.

KELLER: Willy Brown headed the house didn't he?

JOSLIN: He was the majority leader. Gwen Moore who was so instrumental in helping us, and I still see Gwen today. As a matter of fact, we used to have, when I moved to New York and was living in Westport, Connecticut .... For three or four years in the early 80's, we would have the entire California group come to Westport for Bruce Young who was an assemblyman from Newark, California for the first, second, third and fourth annual Bruce Young seafood and lobster fest or whatever. We had Senator Alquist and May, his wife, who was very helpful to us, Bruce Young, Gwen Moore. We even got, at that point in time, .... Was it Jerry still then or had he been followed by whomever else? They consecrated a state of California flag and designated our house as the temporary consulate to Connecticut from California. So there was really a knitting of relationships of people. This was not so much business as it was relationship amongst ourselves and amongst the senators and assemblymen who really were supportive of our position. This really led to, and I suppose you're going to get to this as well, the Walter Kaitz Foundation.

KELLER: Yes, I was going to.

JOSLIN: It was the same relationship. We all loved Walter.

KELLER: Did indeed.

JOSLIN: I arrived in California, as I mentioned, in 1972.

KELLER: I was on the board in '67 or '68.

JOSLIN: Were you?

KELLER: Yes.

JOSLIN: And at the time Amos Hostetter wasn't terribly popular with the California Cable Television Association because of his position on pole attachment rights. He, being the great mediator and spokesperson that Amos is – I mean he has represented our industry so articulately over the last 30 years. I think he has been very instrumental in that arena for part of our success.

KELLER: No doubt about it.

JOSLIN: But the point is, the California Association was in the midst of a big court case with, again, Pacific Gas and Electric over pole attachment agreements. The industry had been used to $2 a year. California was already charging $5 a year and they wanted $10 a year. There was no basis fact because it didn't create any additional costs for PG&E. It's just they knew we needed them and wanted us to pay them. So I arrived in California and stayed a little persona non grata for about a year or so because of the differing opinion that Hostetter had at the NCTA - and I think Hostetter may have been chairman of the National Cable Television Association some time in that period – and the California Association's position on pole attachment agreements.

KELLER: Which was?

JOSLIN: Which was "we're not going to pay anything. We're going to get rid of this. It's not a question of $1, $5, or $10. We're going to get rid of it." That was their approach. Walter was so gracious. He knew that I was kind of in the middle. He welcomed me, as he did everybody, with open arms, sat me down and said, "Now, Ray, we want you to be part of CCTA but this is how you going about doing it." He took me by the hand and really led me into that group. When he died, which was Christmas or early January of 1989, ...

KELLER: That's what it was.

JOSLIN: ... in Dorthea's kitchen, his widow's kitchen, Doug Dittrick, John Goddard, Amos Hostetter, uh, ...

KELLER: Ed Allen, wasn't he?

JOSLIN: Ed Allen may have been there, certainly Chris Derick, several of us.

KELLER: I think Don Anderson was part of ...

JOSLIN: Don Anderson absolutely was there. We were in the kitchen. We decided on the day of his death that we would create the Walter Kaitz Foundation to memorialize Walter and his contribution and his great interest in wanting to bring minorities, now we call people of color, into our industry.

KELLER: And women.

JOSLIN: And women. Del Henry and I – keep in mind this is right about it's '89, uh, '79. It's '79. Del Henry and I are thinking about forming a company ...

KELLER: Walter died in '79, or was it '89? I thought it was '79.

JOSLIN: '79. I was a decade ahead.

KELLER: At this age that's very easy.

JOSLIN: Exactly. Well, why I know that is because in 1980, I joined the Hearst Corporation and it happened right then, just before I arrived here. Del Henry and I were considering putting a company together to develop cable television systems. I had formed Joslin Communications Corp., had franchised a couple of systems in California which I subsequently sold to Continental when I came here. Del and I wrote the first check.

KELLER: Was there any conflict of interest for you in being able to do that as an employee of Continental?

JOSLIN: I had, by that time, severed my relationship with them. I left in 1979 so I clearly formed my own company and was going to go out and do it on my own. Back in the kitchen of Dorthea's and Walter's house, I wrote the first check, $1,000 made out to the Walter Kaitz Foundation, $500 of which would be paid for by Del and $500 of which would be paid for by me as our investment in starting all this. Clearly, it got off to it's first start right on the day of his death. Paul Maxwell was there also.

KELLER: That's right. He would have been there.

JOSLIN: Paul and I, who are close friends and I love him dearly, .... I've watched him start all these different informational things.

KELLER: And he's still doing them.

JOSLIN: He's wonderful. He's wonderful. And I know he and Edie quite well. He and I had a big disagreement because we were charter members of the board of trustees of the Walter Kaitz Foundation. We decided that we should have an event. Paul's ideas was to have a dinner in Denver and one in Los Angeles and one in Washington and one New York and one in Chicago. And I said, "No, have one dinner and have it in New York." He said, "New York? People aren't going to go to New York." I said, "Everyone that is anyone comes to New York to talk to their bankers, to talk with their then cable programming affiliates, and whatever else. Build it and they will come." And lo and behold, the dinner was started here, and I want to say it's probably 1984, 1985. I think we're on our 12th or 13th annual, which has become the single, largest event, I think, in the cable industry, other than the conventions.

KELLER: How much money do you raise now, roughly, by that dinner?

JOSLIN: They will, it's considerable. It had to be put to work. That's the important thing. I think there's no question that they raise close to $1 million or $1 million plus each and every year. I think there's no other place in the city of New York that's large enough to house it other than the Hilton. I think that we are approaching the 2,000 person mark. I don't think there's another dinner in the city of New York that's as large.

KELLER: The last one I was at, I was at the Waldorf. I remember that.

JOSLIN: The last one?

KELLER: The last one I at. Yes, I haven't been around.

JOSLIN: Right. Exactly. Well they had to move to the Hilton because the Waldorf was not big enough. And I'm so happy to say that over the years, the Walter Kaitz Foundation has placed, in our industry, about 400 people in a senior, more senior management positions. Back when I was in California working with Bob Dabney at Peralta Junior College, we started a program for training minority installers and pole climbers and customer service reps, and that worked very well. But the Walter Kaitz Foundation really goes out and looks for outstanding peoples of color who have been successful in some arena of business or education. Either they have their law degree or their MBA or they've worked for 2 years or 3 years and have somewhat of a distinguished short career doing something else or they've worked for a company and they've gone up the ladder. These candidates are all in their 30's. Very rarely are they younger than 30, maybe 28. But they're in their 30's, generally speaking.

KELLER: Great source of management capability for us.

JOSLIN: In they come, not at a senior, senior level but at a level of responsibility where, over time, they then can become members of the senior most management of these companies.

KELLER: Right. I'm trying to think of what year I was on the selection committee. Gee, it was a long time ago though. What year was Hostetter chairman, do you remember?

JOSLIN: I want to say it was probably in the early years. I want to say maybe '85.

KELLER: '84, '85, right. Yes. We hired four or five people in in that year. They were absolutely great. Absolutely great.

JOSLIN: What it does, the whole purpose of it, is to get into the senior most management's minds in our industry, the thought of color, of how we serve our subscribers.... I mean, clearly, demographically the cable industry serves all walks of life. It just makes a lot more sense that if your company's policy and understanding is driven by people of color who are in senior management, that you're going to serve your customers more effectively.

KELLER: We, at that time, just before that time, were severely criticized in Washington for the lack of representation of minorities and women. I think this went a long way toward helping alleviate that problem.

JOSLIN: The first dinner, now that I'm recalling it, was the fall of 1984. Why I say that is Ralph Baruch and I were the co-chairs of that first dinner. I had had a terrible accident the week before the dinner where I nearly lost my right leg. I was bound and determined to get out of the hospital and get there. Of course, it's a black tie affair. I had on top my formal shirt and bow tie and shawl-collared black top. Then I purchased a pair of jeans because my right leg was in a cast from my toes to my crotch.

KELLER: I remember it very well.

JOSLIN: I slit the jeans up the side so the cast would fit in and came in, still perspiring from the infection. I was perspiring like a stuck pig. I'll never forget – my wife, who was not used to me being in a wheelchair with my leg sticking straight out, rammed my leg right into one of the stairs, and I said something that I shouldn't have said. I think I surprised a lot of people with what I said and I apologized for it later, or course. But, it's a wonderful, wonderful foundation. I think it has room to become more effective, more efficient. I think that ...

KELLER: How many interns are they getting each year now, do you know?

JOSLIN: It varies. The pressure's clearly on that we believe that there should be more than 50 each year. I think in recent years it's been plus or minus 10 of 50 total.

KELLER: In the early days there weren't that many.

Tape 1, Side B

KELLER: Ray, when we finished on that first tape, we were talking about the early development and the development of the Walter Kaitz Foundation of which you were one of the founding members and are still on the board.

JOSLIN: Yes.

KELLER: You're a board-for-life member of that foundation, the great work that the foundation has done in involving talented people of color and women for executive positions within the cable industry. Would that be correct?

JOSLIN: Absolutely. That's the ultimate purpose of the foundation, as I said earlier.

KELLER: You say you're doing about 50 a year.

JOSLIN: Something like that.

KELLER: And you're placing all of them at this time.

JOSLIN: I think there are about 50 fellows, and I think the placement rate is quite high. Again, you run into a little bit of a problem because it's a national program. There may be a position available in Knoxville, Tennessee and the person who's living in Portland, Oregon may not want to live in Knoxville, Tennessee. So you do run into those obvious problems when you're trying to place people on a national basis.

KELLER: I found that there was a great idea within the minds of these young people if they wanted to get into television programming as opposed to getting into the nuts and bolts operation of the industry. I used to look for people who were looking to be within management to put in as system managers as the original position. Is this still the case with the association?

JOSLIN: No. As a matter of fact, I was very instrumental in bringing the programming community into the Walter Kaitz Foundation. Initially it was primarily for cable operators looking for senior managers or managers of cable systems, accountants, lawyers, whatever. Clearly, as the engineering side of the industry progressed, we first broadened it to the engineering community. Then as the programming industry began to blossom, programmers were brought in. I would say, today (I don't think I'd be far off) that maybe 50% of the fellows are now actually in the programming side of the business. So it's clearly intended to serve all aspects of the business. Currently we're talking about whether the phone companies should be involved in the Walter Kaitz Foundation. There are some pros and cons and some feelings one way and/or the other. But you have to look at it ...

KELLER: I don't think you can make a distinction between telephony and cable.

JOSLIN: Absolutely. They are now part of our industry or we are part of their industry, one or the other. So I think that will be resolved in the months ahead.

KELLER: Do the telephone companies, say AT&T, want to participate?

JOSLIN: I think so. I think so.

KELLER: I would think that MediaOne was participating being...

JOSLIN: Oh, sure. Absolutely.

KELLER: ... that it was a telephone company owned system. What years did the Kaitz Foundation really, really get off the ground? Do you remember that?

JOSLIN: Really get off the ground? I would say probably in terms of both getting the funds to be able to operate and beginning to place fellows, has to be the mid-80's. With the advent of the annual dinner that provided the funding, I think early on, we were not as happy as we might have been, given the fact that there were five to ten placements a year. We just felt that was not fulfilling the mission. Since that time it's been stepped up considerably.

KELLER: I can remember those discussions so vividly. When you left California .... Or is there anything else -before we get started on that - is there anything else that you can think of that was significant in your stay in California for Continental?

JOSLIN: Well, I think we've covered it fairly well. We did franchise some other communities in California and clearly became a citizen, a corporate citizen of that state. Continental went on later to make acquisitions in the Los Angeles area and other areas in the state of California. My leaving was at an appropriate time, and I decided I wanted to pursue the other side of the business – either from an entrepreneurial stand-point or from a programming stand-point.

KELLER: How did you get hooked up with the Hearst Corporation? And as a corollary to that, how did the Hearst Corporation get involved, or have the idea of getting involved, in cable television?

JOSLIN: If I can go back just for a brief moment. Back in the mid-70's, Jerry Levin and I used to meet with some degree of regularity. We had created what was, at one time, the 3rd largest pay service called Cineview. HBO wanted to acquire Cineview and ultimately did and renamed it Cinemax. Jerry was pondering .... This is pre-satellite when HBO was a terrestrial service in the greater New York area delivering sporting events and some movies by microwave transmission into parts of New York State and the greater New York area. He wanted our Stockton system to be the first affiliate on the west coast. Interestingly, this is again before the satellite, and he and I used to sit and argue as to whether or not in Stockton, California the customers there would want the New York Rangers tape-delayed-5-days to watch and be interested in hockey when there was no hockey team west of the Mississippi at that point in time. This was long before the Los Angeles Kings came into existence. So we'd go back and forth. He kind of really turned me on to what was developing. What happened in the last 5 years, 1975 – 1980, USA went on the air, TBS went on the air as a super station, ESPN went on the air in 1988 or 1989. So clearly, there was another side of the business that was virginal, that was brand new, that was something that was going to be exciting, I thought. Back when I was younger, I had spent some time in summer stock and was on the radio, interestingly, animating the comics when I was 12 years old. I used to do a teenage show in Providence on Saturday morning, sports interviews and things of that nature. So I had a little bit of that side of me in me. How I came to Hearst was two-fold. One was that Dick Munro, who later became the co-CEO of Time Warner and was the CEO of Time, Inc. before the merger, and I were on the NCTA legislative committee in 1966 and 1967. He had the New England and New York and New Jersey area, and I had Ohio and Michigan and Illinois and Kentucky or whatever. We would meet in Washington every two months for a day or two and we would walk the halls. Back then, we weren't talking about issues. We were just talking about what cable television was. No one knew. One of the great meetings we had was with Senator Steven Young from the state of Ohio who, at that time, was quite old. He was in his 80's. We would walk in and try to talk to the senator about cable television, and his pet subject was postal rates. We'd get five minutes, and he'd get twenty minutes talking about postal rates. But that showed you, again with 2,000,000 subscribers, we were just a fly speck on the back of an elephant in terms of an industry. But I got to know Dick. And then, over the years, when I'd come to New York once or twice a year for whatever, I'd always give him a call and we'd have lunch or dinner or spend some time in his office. He lived in New Canaan, Connecticut, as did the CEO of this company, Frank Bennack. One day at the New Canaan Country Club, Frank said to Dick, "Dick, Time Inc. is in the cable television business. We'd like to be in as well. Who do I talk to?" First name out of Dick's mouth was 'Ray Joslin.' Coincidentally, Frank Bennack happened to know John Saeman at Daniels & Associates. He placed a call to Denver to John and said, "You're a big broker. You know all the players in the industry. We want to be in the cable business. Who shall I call?" John Saeman says, "Ray Joslin." So three weeks later, I was in New York talking about it, and two month later I was looking for a place to live in the city of New York. So that's how all that came about.

KELLER: Did they want to get into the cable operating systems or just in the programming side?

JOSLIN: There were three missions that I was charged to pursue. I joined the company on May 1, 1980 so it's just been 20 years. One, was to acquire and develop cable television systems. That I knew how to do. I'd been doing it for 15 years or whatever. Two, was to take Hearst magazines into television. And three, was to develop a strategy and a business plan for what we called electronic publishing. There's a print company with electronics on its way, this is 1980 now, keep in mind. How could we, as a print-based company, really become prepared to deal with this?

KELLER: Did you find it difficult – corporate culture and getting into the print business?

JOSLIN: Well, what was interesting – I arrived on May 1, 1980 with an office 4x5. I had hired an assistant. We had no phone calls. We had no mail. We had no business. So it was a great opportunity to start one, make one up as you go along. I went out in the first month and talked to various corporate officers and group heads. Hearst is broken up into six different, now six different, groups - clearly, the Newspaper Group which is how this company started 112 years ago and today owns 16 or 18 newspapers around the country. Magazines is the largest monthly producer of magazines in the world – Good Housekeeping, Town & Country, Cosmopolitan, Popular Mechanics, on and on and on, House Beautiful – quite a stable, especially in the woman's field. At that time, the Radio and Television division had three television stations and the Books Group, which published books. Since then, obviously, we've added what we call the Entertainment and Syndication group, which is my group. And we also have added Hearst Interactive Media, which has been developing, for the past seven years, investments, dot.com activities. It owns majority equity in woman.com. That's headed up by the former FCC Chairman Al Sikes. What I was to do was: 1) go out find, buy and build cable systems, 2) take the magazines into television, and 3) develop a strategy and business plan for electronic publishing. The first month I went out and talked to Frank Snyder, who at that point was the head of the Broadcast Group. He told me he hated cable. Cable was the enemy. Frank was on the board of directors and also on the board of trustees of the trust that owns this company. I said, "Wow. Okay." That wasn't what I wanted to hear. Then I went to the general counsel, Harvey Lipton. He said, "Ray, I don't own a television set. I'm never going to own a television set. Don't even talk to me about it." I'm saying to myself, "Wait a minute. What have I done?"

KELLER: Different cultures.

JOSLIN: Yes. "Have I made a good decision here in my career?" What was very interesting, and I think very seminal, is that very, very quickly, I came to the conclusion - very short period of time, matter of weeks – that Hearst, on its own locomotion would never take the magazines into television. It was not its mind-set. It's a print-based company while television stations are a form of television. Television stations don't create very much programming except new and public affairs – hardly entertainment or other forms of programming such as a network would. So I learned four very important facts: one was that Hearst and ABC had been essentially partners since 1957 when WTAE, a Hearst-owned station in Pittsburgh, went on the air as an ABC affiliate. The three television stations, at that point in time, were all ABC affiliates; that Hearst and ABC did not compete in any way unless you want to assume that Prairie Farmer, the ABC magazine at the time, competed with Cosmopolitan magazine, which was ridiculous; thirdly, in increasing order of importance, that Frank Bennack and Leonard Goldenson were very good friends. Leonard then was the founder of ABC and then the chairman of ABC; and fourthly, and most importantly, that they both supported enthusiastically and ran the United Cerebral Palsy campaign nationally. Hearst and ABC have donated so much money and time and effort to that effort which is winning. There's hope on the horizon for a cure for cerebral palsy. So I, joining on May 1st I think, my calendar shows that on June 6, I went to Frank for a meeting and I said that I had heard that ABC was thinking about doing the same thing that we're thinking about doing and suggested that he might call his friend, Leonard Goldenson, which he did. Leonard said, "Yes, we are. We've just appointed a guy by the name of Herb Granath to head that effort.

KELLER: Hollywood Granath?

JOSLIN: No, no. He's at ABC. He was on the phone this morning when we were waiting. So within three weeks, Herb and I were having lunch for the first time and meeting. In late December, early January, we formed Hearst-ABC Video Services. Out of it came the Arts Network, the Alpha Repertory Television Service and the Daytime Network. What's interesting about it, if you want to talk about great trust and fiber and relationship, clearly from Leonard Goldenson all the way through ABC and this corporation, there all these wonderful relationships. Herb and I and the lawyers sat for six months trying to hack out a partnership agreement. We got down to the blank on the first page – "what's the name of this company going to be." So I'm on the telephone, and he's on the telephone in his office. I said, "Herb, I'll tell you what. I'll flip a coin. If it's heads, it's Hearst-ABC Video Services. If it's tails, its ABC-Hearst Video Services." I flipped the coin and I said, "It's heads." So that's why it's Hearst-ABC Video Services. But we launched the following April, April 15th or 13th or whatever, the Arts Network which was the Alpha Repertory Television Service which ultimately evolved into, when we acquired the Entertainment Network and brought NBC in as a partner, ...

KELLER: You purpose, though, was to provide programming for television, is that correct?

JOSLIN: Yes.

KELLER: Television stations.

JOSLIN: No.

KELLER: No?

JOSLIN: Cable networks.

KELLER: Cable networks, okay.

JOSLIN: And the ARTS Network was a three-hour evening service that was on the tail end of Nickelodeon. Herb and I went over to Jack Schneider. Jack is former president of CBS television, at the time was working for Drew at Warner Amex, former secretary of HED. We went over to talk to Jack and asked if we could lease space on the back end of Nickelodeon. Nickelodeon, at that point in time, was a day-time service. The assumption was that kids went to bed at 7:00 or 8:00 at night. Perfect for us. Nickelodeon kids' programming, ARTS programming following that at 9:00 at night or 8:00 at night made perfect sense. So Jack made the following proposal. He said, "I'll tell you what. I'll give you a three-year deal. First year, I won't charge you anything for the transponder, second year I'll charge you $1,000,000, third year I'll charge you $2,000,000." We said, "Yeah," and we shook hands and we had a deal. Over time, over the three years, we knew we had to go back to Jack and try to renegotiate this deal. I'm thinking and Herb is thinking, "Fourth year $3,000,000, fifth year $4,000,000, sixth year $5,000,000."

KELLER: You weren't getting that kind of revenue were you?

JOSLIN: No. Jack says, "First year $10,000,000, second year $12,000,000, third year ...." Best thing that ever happened to us. It forced us to get really serious about what we were doing. We had to go out and commission our own satellite and create our own life as the ARTS Network. If you remember Arthur Taylor, at the same time had developed a network called the Entertainment Network, which was intended to be a $10 a month pay service of Pavarotti doing La Boheme live from Lincoln Center. And I believe, well I know that case 'cause I know what was on the balance sheet – went through like $80,000,000 in less than a year - and it became apparent that his partner, who was really Rockefeller Center, which at that point was the real estate people for NBC, the RCA group. So we negotiated a deal with them whereby we would create the ARTS & Entertainment Network and that we would bring them in as minority partners, that they had an agreement with the BBC that we needed badly because clearly we needed that programming as a fledgling network. We spent the better part of a year, because the BBC.... We would have taken the 4" document and thrown it in the waste paper basket – Arthur Taylor's document - because it dealt with an entirely different approach to the service than the one we were proposing. So we spent a year going line-by-line through this document both here and in London. The greatest compliment that I think I've gotten in my professional career came at the end of that. Herb Granath, executive officer of ABC which has a relationship with the BBC, and Herb Schlosser, the former president of NBC, and I were the three guys who had to negotiate this deal. So by prior arrangement, I was to become the bad guy. In other words, Hearst not being in the television network business as we negotiated these points, the two Herbs kind of wanted to be the good guys and I'd play the bad guy role. You've done that many times.

KELLER: Yes.

JOSLIN: And so we'd do this for a year. And we're over in London for the signing and the cocktail party and the dinner and the whole nine yards, and I do play that role as the bad guy all the way through this year of negotiations. A fellow by the name of Michael Checkland, who later went on to be director general of the ABC which was the number one job ...

KELLER: When you say the 'bad guy' – the devil's advocate between these two guys, is that right?

JOSLIN: Yes. Exactly. In other words, in any negotiation there are lots of points that you're not going to agree on, and I would argue strongly in behalf of the two Herbs. But I'd be the one who'd be taking it on the chin. Okay? And we'd make headway in that respect.

KELLER: So that they could go back to their people and ...

JOSLIN: And not damage their relationship with the BBC. So we're standing at the cocktail party, and I'm between Herb Schlosser on one side and Herb Granath on the other side. Michael Checkland, who was the lead negotiator for the BBC comes up to us and he raises a toast. He said, "To the thorn between two sweet Herbs." I like that. I'll take that.

KELLER: You'll take that too. I agree.

JOSLIN: So then the ARTS Network was reformatted, relaunched in 1984 as the Arts & Entertainment Network and it later became A&E because Arts & Entertainment was – like you don't say 'National Broadcasting Company', you say 'NBC'. Today it's one of the premier networks in cable television with about 70,000,000+ subscribers. We've spun out of that, of course, The History Channel, which has been an instant success. We surprised ourselves because in the early 80's when we were developing these networks, it was a lot slower than, interestingly, when we launched the History Channel. The History Channel, in three years, broke even.

KELLER: It's a great, great benefit.

JOSLIN: And it says what it is. Nick Davatzes, who is the CEO whom I know quite well, kind of tongue in cheek says, "The reason that it's so successful is that they found out that 85% of all the cable managers in the country were history majors in college."

KELLER: I was one of them.

JOSLIN: Okay. Since then, of course, we've launched the Biography Channel, which is a digital channel. We're now in 35 countries...

KELLER: Is that separate ownership from the History Channel or is it part of it?

JOSLIN: It's all under what we call A&E Networks.

KELLER: Okay.

JOSLIN: So it's Hearst and ABC own 75%, NBC owns 25% and that is of A&E, of the History Channel, of the Biography Channel, of the History Channel International which is now in 35 countries around the world in partnership with the local television and/or other entities in those countries, and now the International History Channel as opposed to the History Channel International. The History Channel International is a service in foreign countries. The International History Channel is a new service here in the United States that deals with international history.

KELLER: Interesting to note – you can tell me why – you were in partnership with ABC and NBC but not CBS. CBS was the first one involved in cable television. Any reason for that?

JOSLIN: I think because of the cultural mesh between Hearst and ABC for one thing. Clearly, I've described the relationships that existed. And it just happened. It was easy to happen. People wanted to make it happen. No question that CBS Cable that launched in 1980 or whatever, I think was the finest cable service ...

KELLER: I'm talking about on the operating side though – that CBS was involved in the operating side back in the '60's.

JOSLIN: Well, they were with Blackhawk Cable.

KELLER: They had part of the operation in Vancouver and Canada big, San Francisco operation.

JOSLIN: Well, yes and no.

KELLER: Well, you're absolutely right because they wouldn't brag about it.

JOSLIN: Ralph Baruch, .... CBS was the largest cable owner in North America at one point in time, cable systems.

KELLER: Exactly.

JOSLIN: And they kept their systems in Canada, and they spun off Viacom – Ralph Baruch.

KELLER: They bought Teleview.

JOSLIN: Right.

KELLER: Which was then became, I think, Viacom after that – Goddards.

JOSLIN: Right, the Goddards, exactly. The cable system interests in the United States were owned by Viacom, which was spun off separate from CBS.

KELLER: Yes.

JOSLIN: Because you couldn't cross ownership. You couldn't own television network and cable systems at the same time.

KELLER: They had a minority interest in San Francisco at that time and were providing all of the capital. That was in the '60's though when this happened.

JOSLIN: But clearly, on the programming side, they launched in 1980 CBS Cable which was the best quality programming for a new launch. The problem - and one of the things that even to this day with our now 20-year relationship with ABC, comes up every once in awhile but came up more frequently early on – and that is broadcasters don't understand that distribution is an integral part of the success of the network. Broadcasters say, "Okay, if I produce a great program, immediately it's out there for 100,000,000 homes to watch." Whereas in cable, obviously, we've got to work with the cable operators on a company-by-company, sometimes system-by-system, basis and negotiate an agreement for carryage of that programming. You can have the best programming in the world and if no one can see it, who cares. So that's what befell CBS Cable. I can remember going out to Long Beach, the Queen Mary with the full CBS orchestra and Sarah Vaughn aboard the old Queen Mary I guess it is, and having the launch of CBS Cable. It was a lot of money spent very fast on programming but with no distribution. That is key, obviously, to where we've come. On the other side of it, we launched in 1982, what was known as (or Hearst-ABC Video Services did) –launched Daytime. Daytime was a 4-hour service, essentially taking the Hearst magazines into television. I mean we did "A View from Cosmo" with Helen Gurley Brown. We did "A Better Way" with John Mack Carter who's the editor and chief, or was at that time, of Good Housekeeping. We did things like Esquire's "About Men for Women" – a whole host of magazine-related programs that were on in the afternoon from 2:00 until 5:00.

KELLER: You indicated that two of your commissions were to get into the cable system business and to bring the magazines into television. You accomplished both of those by providing cable programming, is that correct?

JOSLIN: Yes. Well, not really. I'll come back to mission one. It's just that maybe this happened a year or two, what I'm telling you now, before our cable systems acquisitions. But we then launched Daytime and coincidentally also in 1984 reformatted it, relaunched it as Lifetime Television. Hearst-ABC Video Services owned 66 2/3 of the equity. Viacom owned 33 1/3 %. In 1989 or 1990, Hearst-ABC Video Services bought the one-third from Viacom. So today, Lifetime is owned 50-50 by Hearst-ABC.

KELLER: And you run it together?

JOSLIN: Yes. We hire.... It's decentralized. There's a president and a staff of 400 people that, in fact, run it.

KELLER: But the board is comprised equally of ...

JOSLIN: Yes, of Hearst and ABC. Exactly. Herb Granath and I have, since 1980, co-chaired the board, one of us taking Lifetime for one year while the other has A&E for that same year and then switching off at the end of that year to the opposite way. So we operate that way.

KELLER: Involved with that, how were you able to make a deal with John Malone at TCI?

JOSLIN: Well, that's interesting.

KELLER: I don't want to get into the details because TCI would not like to have that disclosed.

JOSLIN: No, I cried a lot. I got down on my knees. I slalomed or whatever that's called. I did everything I could. As a matter of fact, I went out to .... And John was very instrumental in getting us clearance on TCI for A&E. I think he saw its real value. It's been a good relationship in that respect. I think, likewise, keep in mind now this is the early '80's - this is 1981 or 1982....

KELLER: He was demanding a piece of the action?

JOSLIN: That wasn't the case at all at that point in time. No. Clearly, cable operators, of which you and I are two of them, saw the real dilemma in the late '70's and early '80's where we couldn't sell our cable service because we had nothing to put on or very little to put on. No longer was it a retransmission service as it was in the rural areas. It was now urban where people got television with a coat hanger hanging out the window. So the cable industry needed product such as A&E and Lifetime. It was only later where then spectrum space and box space became a problem and cable operators are now selling space on their systems. So Lifetime went on to 75,000,000 subscribers as the 5th largest network. Throughout this year, it has been rated either #2 or #3 in the Neilsen ratings, 2nd only to USA and that's because every night USA has wrestling on. But they're not going to have it much longer because that deal has fallen apart.

KELLER: You also got ESPN, right?

JOSLIN: We also have ESPN. We bought 20% of ESPN kind of as a result of our purchase, development and sale of cable systems. We started in 1982 or 1983 acquiring cable systems, and we bought some from Group W in the south bay area of San Francisco. We looked at 100 different opportunities at that point in time, from Cablecom General to ...

KELLER: Difficult to get the board to agree on which cable systems to buy?

JOSLIN: What it was, I mean, clearly Hearst is a software company. It's not a hardware company. Early on there was this continual thought by a lot of people in this building that cable systems was a fad, a passing thing.

KELLER: Typical broadcast mentality.

JOSLIN: Typical broadcasting, absolutely. Absolutely. No fault to them. And, frankly, what they did is they gave me the license to go out and buy cable systems but in a modest way, with the thought that we're going to own 500,000 subscribers at one point in time. We never did because the investment of the networks was very substantial for the size of this company at that time. How many places on the roulette wheel do you want to be covering at one time with what kind of money? Clearly, we showed that we knew what we were doing in the cable network business. We did demonstrate in the cable systems business where we bought those systems. We developed them, put a sizable investment into them and new equipment and personnel and management and customer service procedures and doubled the size of the systems that we owned from 1983 to 1989, 1988. I finally went to Frank because, by that time, the multiples of cash flow, valuation of cable systems let alone the per subscriber fee which should tie together, .... I mean, the per subscriber costs of acquisition were going north of $2,500 a subscriber. We had purchased them at $1,000 a subscriber. So I said to Frank, "We've either got to make a decision either to ante up to get to 500,000 subscribers - because as a small guy, we're not going to have any leverage at all either with suppliers of programming or equipment or whatever else – or sell."

KELLER: You recognized that very early on.

JOSLIN: Yes. So we made the decision to sell. Leo Hindery, who went on to be CEO of TCI and very successful in the business – this was his first acquisition for InterMedia Partners. Leo and I negotiated that deal and concluded it in early 1989. It provided us with a tremendous return on our investment, which then allowed us to take those monies and invest them in the 20% of ESPN, which had become available. R. J. R. Nabisco wanted to sell its 20%. ABC, which I think for years after, wished they had bought it themselves because they own the other 80%. We bought it, and it's been a tremendously successful investment and network for us. ESPN today has 28 networks around the world – I mean around the world! It's a huge – it's the largest sports service and information service in the world, besides the four networks here which are ESPN, ESPN2, ESPN News, and Classic Sports. There's networks in Asia, in China, a huge facility in Singapore that uplinks five or six networks out of Singapore to all of those Asian and Eastern Bloc countries, South America, Europe. It's a tremendously successful service, and we're just glad to be a part of that.

KELLER: When you were looking at and trying to make the decision between being in the operating cable system business and the programming business, was the cash flow of the cable division bigger than that of the programming side?

JOSLIN: Oh, yes. Of course. Because the economics of cable systems are such that it does generate cash flow. The beauty is your depreciation. That is that you pay taxes on net profits after depreciation. With a capital intensive industry like cable, you have huge gobs of depreciation which allows you to then take the cash flow, which are not profits.... And when you think about that for a minute, that kind of accounting is very foreign to this company.

KELLER: Oh yes. Yes.

JOSLIN: The question is that you can't spend profits. You can spend cash. So you've got to generate cash flow.

KELLER: It took Time, Inc. a long time before they recognized that that was the case and their EBIDTA, I think they call it, earnings ...

JOSLIN: So it was a real lesson in learning that we all had to go through - how to balance this portfolio of cable systems investment and now cable networks investment. We subsequently, in the programming arena, were now very international, aside from the History Channel International that I mentioned. Hearst is a partner with the Cisneros Group in Venezuela in a service called Locomotion, which is an animated service in South America and in Spain and Portugal. We just launched, in February, the Cosmopolitan TV in Spain and Portugal and intend to expand that to other places around the world. We're clearly invested in Brazil - TVA is one of the two major cable companies down there. We've been invested with them for the last 5 years, both in programming, ala HBO, ala ESPN Brazil, and cable systems and MMDS services.

KELLER: Are you required, by your agreement with ABC, to get them involved in anything that you become involved in in the programming ...?

JOSLIN: No.

KELLER: So you can go out and do your own thing.

JOSLIN: Yes, exactly.

KELLER: So can they?

JOSLIN: Yes, they have. They went out and bought an interest in E!. They've just launched the Soap Network. Both of us are free to do that.

KELLER: So if you found another opportunity, would you offer a piece of it to ABC before you took it on yourself?

JOSLIN: Might - depending upon the circumstances - depending on where it was, what it was. It's no longer ABC. It's now Disney which is a different culture and company altogether. I make no comment one way or the other on that ...

KELLER: I've had an earful of that in Peter Barton's interview.

JOSLIN: Just to say – different. It's different. So they are our partners now. Actually, I've been sharing - the last several years since the Disney acquisition - co-chairing the Lifetime side of all these business with Gerry Laybourne first for about 2 ½ years when she was at Disney, before she formed Oxygen, and most recently with Ann Sweeney who is the president of Disney Cable. But we're looking for, we're very inquisitive .... We're looking for other international and domestic opportunities in the programming business. The third charge, electronic publishing, really doesn't have too much meaning for this purpose here, but suffice it to say we took a company that we bought for $85,000 in 1980 and took it to a $60,000,000 revenue and substantial pre-tax profit. I volunteered, 1 ½ years ago, to move this over to the Hearst Business Media Group simply because Hearst had sold off its book publishing. It had a collection of business media enterprises that were very electronic - the Crash Estimator where you go into a garage and they'd punch in the thing and your front fender is damaged, and it prints out what the estimate is and you walk away immediately with the estimate. Well, I moved that over to them about 1½ years ago which was the right place to go. So essentially today, we are in, my group is in, three different businesses. We're in the cable network business. We're in the television programming production business. And we're in the distribution business.

KELLER: You run the television stations then?

JOSLIN: No. No. That's Hearst Argyle today. We own Hearst Entertainment Productions which is located in Los Angeles, and we'll produce anywhere from 12 – 15 movies a year, made-for-television movies, not theatrical movies. We do some of those for ABC, CBS and NBC. We do them for ZDF, then Germany and the Canadian Broadcasting Company. We do a lot of the Lifetime movies – the movies that you see on Lifetime on a regular basis. We also produce what we call "first run syndication." That is, once a week, half hour or one hour programs, "Barbara Smith with Style," "Popular Mechanics for Kids," "House Beautiful," a whole host of those kinds of programs. We produce some animation because also in my group is a company called King Features Syndicate, which is the only company that existed when we put this group together. King Features is now about 95 years old. It's the largest syndicator of comic strips and features in the world. I have serious meetings about Betty Boop and Popeye and Beetle Bailey and Blondie – serious meetings. And of course, it not only distributes comic strips to 4,000+ newspapers around the world, but also is involved in merchandising and licensing. What you saw when you walked in to the lobby, that cow, was officially given to me last week. We are the international merchandisers and licensers for the Cow Parade, which you may have heard something about.

KELLER: Oh, Chicago. I saw it big when I was in Chicago.

JOSLIN: Yes. 600 of them in the City of New York right now. We had to have our own in our office lobby. Then on the television side of it, as well, we distribute this programming both domestically and around the world. We have output deals with ZDF in Germany and with TF1 in France. So we sell the movies and our library products.

KELLER: You handle that yourself rather than going through a distribution company?

JOSLIN: Right. We have both a domestic distribution company for film and television programming and an international distribution company.

KELLER: But is the majority of your business within cable systems right now as opposed selling to broadcasting networks?

JOSLIN: Both. We sell to cable networks around the world because there are many cable networks now, as you know, satellite networks, in Europe in particular and other countries. We sell to all the cable networks here from Encore to HBO to Showtime and whatever.

KELLER: Have you ever put up your own satellite or do you have your own satellite now or are you still leasing time in space?

JOSLIN: No. We .... Everyone leases. You don't own a satellite. It's expensive to own, but it's not that expensive to lease. That's a science.

KELLER: Echo Star is doing it.

JOSLIN: I know. But there are very few people that own ..... ESPN, I think, has 25 satellites. They don't own a one of them. They lease them. We're not in the hardware, geoscopic space.

KELLER: Think of all the offers ever time a rocket goes up.

JOSLIN: Exactly. So this little group that didn't exist in 1980, is now the largest profit producer for this corporation and will be shortly the largest revenue producer. We're exceeded only by the magazines that have a higher revenue but don't quite have the margins that we have. I've been a very fortunate guy. I get up every morning and think about the last 35 years of my career. I've always been enthusiastic about going to work. I love what I do. I've been very lucky to be on two sides of this wonderful new industry – new in our lifetime – both on the hardware side for about 15 years and now on the software side or the programming side for another 20.

KELLER: As a programmer and a distributor, what do you think of the advent of the telephone companies coming into the business? Is it going to be more difficult to work with these companies?

JOSLIN: I guess it depends on what you're selling. I think, as a program supplier today, that where we are with the networks we have, .... Fortunately, we got into the business at the right time. All of the networks that we own, or the major brands that we own, are in the top 10 cable networks that exist today both in ratings and billings and subscriber coverage and so forth. I don't see AT&T being any different than the cable operators were in terms of negotiating carriage rates and wanting to provide alternative services to their subscribers. In one respect, the very reason that the phone companies are now involved in this business, is to provide a bouquet of services into the home. The old one-wire concept – it's coming about, not legislatively as I think the phone company would like to have years ago achieved. But it's coming about economically where the phone company is going to be the one wire into the house with a panoply of all sorts of digital video, all sorts of unimagined services, I think, as we move forward through this new century.

KELLER: In listening to [C. Michael] Armstrong in Chicago at the convention two years ago, it was interesting what his foresight is in developing that company. I just hope he can do it.

JOSLIN: Yes.

KELLER: We talked earlier about you owning AT&T stock, and I've always viewed it as a little old lady's whole stock because they needed those ...

JOSLIN: Well, that wouldn't be bad if it was that.

KELLER: It's not that anymore though.

JOSLIN: The question becomes, and I, just because of the evolution of Continental stock to USWest to MediaOne and now the final acquisition of MediaOne by AT&T, do become a AT&T shareholder. Given the rest of my portfolio, it wouldn't bother me if AT&T were a little old lady's stock that paid you a nice dividend every year, didn't go up, didn't go down. My question is, I don't know whether I can say that going forward.

KELLER: I don't think so because I think Armstrong has already said that he is going to take a lot of that money that went into dividends to develop his cable networks or whatever they're calling them now. That's going to be very difficult for him to do, I think. Anyhow, I wish him well. How do you see the future developing from the programming side?

JOSLIN: I think that there will be a continued proliferation of new concepts in programming. On the other hand, .... and we get to see them all here, not only in one permutation but maybe four or five times over the last 20 years, someone says, "Ah, this is the latest thing since sliced bread." I think the major genres of cable network programming have been taken. There's probably not going to be 5 more sport services. There's probably not going to be 3 more news services. There's probably not going to be and so on and so on. Movie services are different enough. While they are movies, they are different movies, old ones, new ones, whatever. I think that the model for new cable network is already drastically changed. We're no longer looking at launching a network. I think the last of which to do that was the History Channel because it was a niche that had not yet been captured. It got the imagination of everyone. It is what it is. But I think that some of the news services have to look at economic models that are not 80,000,000 subscribers but 20,000,000 because that's what, if you're lucky, you'll be able to get carriage. Then the question becomes, who pays whom. This whole issue here of .... Early on the cable programming industry had it right. The broadcasters pay the affiliates a percentage of their ...

KELLER: Which they wish they never had started, believe me.

JOSLIN: And they're trying desperately to get out from underneath that. But in our business, we started it right – that is that cable networks have been blessed with two revenue streams: both a subscription revenue stream, if you will, in terms of fees that the cable operator pays each and every programmer, and advertising fees based upon the qualitative basis or depth and quality of the programming - the ratings. Those have provided wonderful funds for providing even better programming. You look at early ARTS Network programming and you look at A&E today, Biography, the qualitative and quantitative differences are so substantial. That means that a lot of those monies have put back into good, quality programming. Smaller programmers or new ideas are having ... I mean, Oxygen is having a devil of a time to get off the ground and they want $.19 a subscriber. When you've got [Rupert] Murdoch running around paying $10 a head to get on, to create the Fox Network, it's kind of hard to launch a cable network looking for two revenue streams. So I think the models of networks – there will be new networks and some will fall by the wayside because not everybody can succeed in this business – but the new model, I think, will be a lot more conservative.

KELLER: Do you see the broadcasting network companies, CBS, NBC, ABC, getting more involved with programming services in the future?

JOSLIN: With cable programming services? They could buy, I guess. In terms of creating, clearly Disney is up to its ankles in cable programming networks, no question about it. NBC has done an amazing job. Tom Rogers, while he was there, I think did a super job of getting NBC's mind focused on being in the cable programming business - CNBC and MSNBC – and getting a network like NBC to make it's top-drawer talent available on something other than the base network. All those news people work hard at CNBC and MSNBC. CBS has now come into the programming business through Viacom. That is an interesting balance. What's happened here is that there was a time when the FCC had rules called the Fin/Syn rules, Financial Interest and Syndication Rules. These rules forbid a network such as NBC, CBS, ABC from owning, airing and syndicating it's own programming because it would have been restraint of trade. With the proliferation of all the competition now from all different sources over the last 25 years anyway, the FCC rescinded Fin/Syn so that networks now can do all three of those things. Exactly what we predicted, not alone I might add, would happen has happened. That is, the studios are buying the distributors. So Disney, the studio, the producer, bought the distributor ABC. Viacom, the producer, the studio, has bought CBS. NBC is still on its own essentially. But that's the trend in television where the vertical integration will become even more in the programming business, producing business.

KELLER: That's very interesting because there's a direct conflict there because movie companies can't own theaters today. They haven't been able to since the mid-'60's. And yet, everything else is coming around now. Interesting aspect of this whole thing. How do you want to wrap this up?

JOSLIN: I thank you very much for your time. This has been interesting, as we said during the break. It's been a wonderful .... We've know each other for several years and it's a wonderful walk down memory lane to conjure up some of these great stories and feelings about this business and about the zeal of the people, the uniqueness of the people in this business.

KELLER: I hope this continues also as more wired companies and telephone telephony get involved in this whole thing. We may lose that great desire that those of us who were early on did all kinds of things.

JOSLIN: It's not an entrepreneurial business anymore.

KELLER: No it's not. It's a paper shuffling business. This biography, this history of Raymond E. Joslin is produced for the National Cable Television Center and Museum through a grant by the Gustave Hauser Foundation. Your interviewer: Jim Keller. Thanks, Ray.

JOSLIN: Thank you.

KELLER: Enjoyed it.

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Jerrold Sales and Engineering Panel Discussion

Interview Date: 2002
Interview Location: Unknown, PA USA
Panelists: David Batalsky, Jim Bailey, Walt Mecleary, Bob Bilodeau, John Zawojski, Mac Qurashi, Caywood Cooley, John Kurpinski
Moderator: Brian Lockman
Note: Tribute to Milton J. Shapp

LOCKMAN: First of all, this should continue to be freeform. Just because the tape is rolling now, don’t...

(____?): It’ll be free.

(____?): You don’t want to say that, not with this group.

LOCKMAN: It probably won’t be too difficult, but this would work better if it was going back and forth so much that I could just get up and leave and it would keep going, so don’t wait ‘til I ask you a question before you start talking, and don’t be shy.

(General protestations)

LOCKMAN: And also, if you told a story upstairs, tell it again down here because the tape wasn’t rolling up there.

BATALSKY: If you look at us and think about it, and also some of the people in the audience, we were in the entrepreneurial days and the bare knuckle days of cable, and anything could be done. We didn’t know we couldn’t do it. We didn’t have MBAs, we didn’t have Harvard people, we didn’t have guys who smoked books, we just worked.

LOCKMAN: What were those years? What years were you there?

BATALSKY: I started in ’64.

(____?): ’65.

LOCKMAN: Johnny?

ZAWOJSK: I was there in ’55, I started.

LOCKMAN: Caywood?

COOLEY: 1950.

(____?): Wow!

KURPINSKI: ‘63

QURASHI: ’63.

(____?): ’65.

(____?): Children.

(LAUGHTER)

LOCKMAN: Walt, when did you start?

MACLEARY: 1959.

(____?): Three channels.

MACLEARY: And we had three channels.

(____?): Wait a minute, Johnny was at ’55.

QURASHI: I was working on six when I got there.

(____?): I came in just as they were making the jump from six to twelve.

BATALSKY: One of the things that you forget is that we were not number one in those years. There were other companies – Entron, SKL, Ameco. Ameco had the first solid state amplifiers out there out of Phoenix.

(____?): Vikoa.

(____?): Well, no, Viking, that’s a different story.

(____?): That’s because they were copycats.

BATALSKY: Oh, yeah, that’s a different story.

BATALSKY: And then some of our own engineers from Jerrold left and copied the same amplifiers we made and called them Telesystems, and sold them against us. Fred Lieberman’s group, remember? Remember when Fred did that with the SCA-213?

(____?): Well, we copied the SKL amplifier.

(____?): Yeah, well we copies SKL and Entron. Who cares?

QURASHI: No, we didn’t copy SKL. SKL copied our module in the housing.

BATALSKY: SKL copied us. Yeah. They made it identical almost.

QURASHI: And then it didn’t work!

(LAUGHTER)

BATALSKY: They’d copied all the things that we made mistakes with!

QURASHI: If we had a problem with Starline One transistor burning, they had the same problem.

(____?): They copied the mistakes.

(____?): There was another company in there called Amplivision that made a distributed amp they primarily sold to the phone company as a market, as did SKL.

QURASHI: But we also sold to the phone companies. I remember those days.

(____?): Yes.

(____?): What did we call them? Leasebacks! Leaseback systems.

QURASHI: Yeah, but there was a huge, big system with almost about 24 tubes in it.

(____?): It was a broadband amplifier.

LOCKMAN: The BDA?

BATALSKY: No, no, no. The SCA-213.

LOCKMAN: Oh, the SCA-213.

QURASHI: I don’t remember the model number.

(____?): That was a distributed amplifier.

QURASHI: All I remember is that I was working in the laboratory, and I used to assemble all the prototypes, so Frank Ragone and George Doodey walks up to me and says here’s a print and we want you to make this chassis. Having a college degree before, I was utterly bored, so what I used to do was count. I put 5,200 rivets in that thing; I still remember that, so there’s no leakage.

COOLEY: But David jumped right out into, what was it? 1960-something?

BATALSKY: Yeah, ’64.

COOLEY: You got to remember this all started really sometime in 1951.

(____?): Right.

COOLEY: Because I went to work for Milt when he was just doing master antenna systems, and I was working at Philco. Philco was looking for Jerrold to sell more amplifiers than apartment houses, and Jerrold was looking to Philco for distribution. So, one day Milt called me down into the office – I hadn’t been there but three or four months – and he said he wanted me to go up to Lansford, Pennsylvania to meet a guy by the name of Tarlton because he’s buying more apartment amplifiers than there are apartment houses in Lansford.

(____?): There’s one apartment house; he owned it. Three groups.

COOLEY: He was putting those amplifiers on the poles and they worked good to about three or four amplifiers, and then it was gone, and you know why. But looking back at that time, in 1950, but for World War II and some of the surplus that was available after World War II, the start that Jerrold got wouldn’t have happened.

(____?): You mean with the cable?

(____?): The RG-59.

(____?): The SK-11.

COOLEY: RG-11 and RG-8, miles of it, and you have to remember that the services trained hundreds, if not thousands of electronic technicians. So we had a real source of manpower that just needed to convert from what was defense into television, and that’s what really was the handspring of the whole deal.

BATALSKY: I remember a meeting once with Beiswinger and Doug Fife about the model shop. They were making a splitter and it never got past the model shop, so the model shop was making these things 25 at a time and we’re using hundreds a month. And so whenever they used to buy from this guy Doug Fife who had the machine shop, they’d order 25 at a time, he would charge them $3 a piece for these housings. The housing’s worth like .11 cents. This was going on for seven years, and somebody in auditing caught it and so they had this big meeting, and Beiswinger said, “How much you charging us for these?” He said, “You’re ordering 25 units a piece, $3 a piece.” He said, “You’ve been doing this for seven years?” He said, “That’s right.” He said, “How much does it cost you to make these?” He said, “It’s not your business, but I’ll tell you - .11 cents.” So Beiswinger says, “We want a credit back.” He says, “You’re not going to get a credit back,” he says, “But I’ll sell them to you for $3 a piece for 25 units, or I’ll give them to you for nothing for seven years.” So Beiswinger says, “Well, I can’t get them for nothing,” and he says, “Good, they’re $3 a piece,” and he walked out of the office.

(LAUGHTER)

(____?): Everything went on like that there.

MECLEARY: Wasn’t Philco doing Escohoney at that same time that Lancer was going in? Joe Conawald was in Escohoney and he had signal down to the bottom of the mountain, had pictures, and we were still screwing around trying to get good pictures to the bottom.

COOLEY: I don’t think at that time. I think the other guy with John Walsonovich...

MECLEARY: Johnny Walson.

COOLEY: Yeah, Johnny Walson.

(____?): He didn’t say Walsonovich.

(____?): Yeah, he was Service Electric.

(____?): Okay, sorry about that.

(____?): He was coming down on 300 ohm ribbon down through the trees.

(____?): But he was in Mahanoy City. That had nothing to do with Lansford and Escohoney.

COOLEY: That’s another thing that was so important. The reason that Tarlton got a head start is that was the only telephone system that wasn’t owned by Bell or somebody else. It was an independent telephone system in Lansford, so he had immediate access to the poles for 12 bucks a year, and everybody thought that was great, that and the excess surplus RG-11 U and our apartment amplifiers got him started.

MECLEARY: Well, we go the apartment amplifier from Don Kirk, didn’t we, in Annapolis?

COOLEY: Oh, no.

MECLEARY: It came out of Annapolis, Maryland.

COOLEY: Oh, he created them there, he designed them there, but they were built at 26 and Lehigh.

MECLEARY: No, 26 and Dickinson.

COOLEY: 26 and Dickinson, thank you.

(____?): Yeah, then we moved.

(____?): But Kirk was basically the guy that made the amplifier.

(____?): Right.

(____?): He designed it.

COOLEY: Yeah, Don Kirk was really the genius in the beginning.

MECLEARY: So Milt used to buy from him.

COOLEY: As things moved on, the whole thing that made this thing possible is the test equipment that came out of World War II because where would we find siliscopes in those days but for the war, and then we had these single generators that you could buy real cheap, and that got us started, and then Ken Simons came along.

(____?): There you go, Ken Simons.

BATALSKY: Ken Simons

(____?): Ken Simons!

BATALSKY: He was a god!

(____?): Ken Simons came along and built all the test equipment we ever needed.

BATALSKY: He never looked at pictures.

ZAWOJSK: You’re selling your focal outfit short 7008.

MECLEARY: The problem that I had as a salesman being a known engineering type, all right, was that I looked at pictures and that’s what sold.

(____?): That’s right.

MECLEARY: And the engineers looked at signals.

(____?): I used to say, “Hey, Ken, I don’t care what your spec says. It doesn’t work. Come out to this field and I’ll show you pictures that didn’t work,” and he would come out and go,

“Oh, well, yeah, we’ve got to modify that.” I can’t tell that to my customer, right? Joe Gans would say, “Hey, take that.”

COOLEY: Remember, Ken built a pretty good VHF attenuator with switches on it.

MECLEARY: Yeah, AV-75.

COOLEY: That’s when we got smart because you could take that attenuator and put it after an amplifier and put a decent TV set on it, and the name of the game is to put as much attenuation there is until it died.

(____?): I bet you burned a lot of those out in the field.

(____?): Johnny, the gutless wonders you used to walk in? The GE gutless wonder? The TV?

BATALSKY: The GE gutless wonder?

BILODEAU: Oh, the GE TV set.

(____?): That was the Munce.

BATALSKY: No, no, a little portable GE gutless wonder because Johnny used to tell me, one day he walked into a guy’s house and a little Italian man was complaining about the pictures, and John comes in with the 704 and he says, “Look at that, there’s channel 3, there’s channel 4, there’s channel 6,” on the meter, and the guys says, “I don’t pay for meter movement.” So he
went out and he bought a GE television, a little portable, brought it in, put it in and showed him clear pictures, the guy says, “I guess I need a new television.”

(____?): Oh, yeah.

BATALSKY: Black and white, the old gutless wonder.

QURASHI: The most difficult design we had was designing the transformer, the back of the TV set.

(____?): Yes.

(____?): Yep.

QURASHI: The most difficult because it has to be strong enough where somebody could pull it and pull the TV behind it, and yet it has to work and sell for pennies. That was the biggest difficult design that we had.

(____?): What were we paying for cable?

(____?): $3.95 a month.

(____?): $3.95, yeah.

QURASHI: I know.

BILODEAU: One of the questions that on the material that was sent out by The Center was what really distinguished Jerrold from other companies in terms of its eventual dominant position in the industry. Now, Caywood has mentioned that the test equipment that came out of World War II had played a role in that, but here’s an example of both sides of that question. Dumont Laboratories had the leg up on all the siliscope manufacturing developed during the war and they came out of the war and they built a company but failed four or five years later. So here’s Jerrold not failing and growing and becoming very successful in its field, and Dumont failing in its field. So it isn’t just a technical answer. You just can’t say Ken Simons made test equipment and that’s what... So there’s not a simple answer to that, but I thought about it, and to me, the reason that Jerrold grew and maintained a dominance in the industry is because of people out there in field making contact with the customers. I was a cable operator in the ‘50s, and who called on me? Lieberman, Mel Gray, and they took care of your problems and they told you what you needed and what you didn’t need, and they dropped out of the sky. SKL didn’t have

anybody like that. I couldn’t call up any other company and get that kind of assistance. Mel Gray got me into the company as an employee as well, that was my contact and my entrée into Jerrold when I came to work for them. So I think it was the field engineers and the field sales people, and I was just revealing some stuff... Over the years I saved these newspaper clippings from
different grand openings of turnkey cable systems and the systems operating division would send out a team to help you open the system and turn it on and do print copy and to write copy...

BAILEY: But even before that, Bob, Jerrold was the first company to stand up there and say we will build your system for you. All you have to do is show us a franchise, nothing else!

(____?): No money down.

(____?): That’s right!

(____?): And no money down!

BAILEY: They would take that franchise, they would design the system, they’d build it for you, they’d proof it and they’d turn it over to you. At that time you couldn’t get the system until it was fully built.

QURASHI: Not only that, they helped get franchise, too.

BAILEY: They’d help you with franchise; they’d help you with the opening. Remember when Beiswinger would come up there and say we’re going to open – I guess it was the Valley at the time – and we put on the marketing campaign for it, we went out and we’d set up... remember when we set up the 12 channels in the thing and everybody would come in and they’d start looking at the pictures that they were going to get, and the signups were like that!

COOLEY: You remember, though, in the early days you had a good picture if you could tell the difference between a horse and a woman.

(LAUGHTER)

(____?): That was the distinguishing factor.

COOLEY: That went away and pretty soon we had to learn the skill and the techniques and the engineering of what makes a system work, and here’s a list of all the guys... I still think the test equipment that came later – Bob, you’re prominent in this thing – and if you need a list of all the people who worked on it, on the back of that book there is all of the articles that were written about test equipment.

BAILEY: But the thing about it is that because of the turnkey, not only did we build the system, we trained the people and they didn’t know anything else in the way of what to do. As

soon as they had a problem, they’re first call was to Jerrold, right? “I want to do this, I want to do this, what do I have to do to do it and when can you do it for us?”

LOCKMAN: Why did Jerrold do it that way instead of just coming in and saying we’re going to build a cable system and own it and run it.

(____?): They did.

BAILEY: We tried that.

(____?): Anti-trust.

(____?): It was an anti-trust issue.

BAILEY: We tried that, and actually in 1965, I guess it was more than that, we had our own systems. We were the largest MSO in system operations, and finally we sold it out in, I guess in ’68 when General Instruments came along because the customers were starting to tell us that you are now becoming our biggest competitor.

BATALSKY: We had the largest cable system in the United States at one time, which was Harrisburg, Pennsylvania.

BILODEAU: But Jim and Dave, before that there was a legitimate court case. Milt Shapp attempted to take a percentage of revenue from supply and hardware, and that was an anti-trust issue.

(____?): In ’58.

(____?): Yes.

(____?): That was.

COOLEY: That was the Jerrold Service Corporation because I helped start it like in 1953.

(____?): Ah-ha!

(____?): There you go.

(____?): I think that was before my time!

(____?): Get the handcuffs, get the handcuffs!

BATALSKY: Where’s the federal marshal? Let’s get him!

COOLEY: We were getting .25 cents a customer per month, and the government shut that down.

BATALSKY: Our governor!

LOCKMAN: Can you explain how that worked?

COOLEY: Well, we were going to provide them with field engineering service when they got in trouble. Anytime they called we had somebody there. And you know, another thing about the early days is that when I joined Jerrold I was their chief field engineer because there was only one and that was me. I was chief.

(LAUGHTER)

BATALSKY: That’s how he got the title!

COOLEY: But then I went out and hired everybody I knew in the Navy and Philco, everywhere, anybody that I had, and pretty soon we have a covey of half a dozen, a dozen guys, and then we started a school.

(____?): Who picked up with it after I let it down?

BATALSKY: Vic Nicholson.

QURASHI: Vic Nicholson picked it up.

COOLEY: And then Len Ecker.

(____?): Len Ecker, yeah.

COOLEY: But I had schools of six-seven hours a day, five days a week over months training guys about what a decibel was, and what it wasn’t, and how you could use it to figure out how things were going, and that’s where we started. Remember, later on when Scientific Atlanta came out with the dishes and all that, they did exactly the same thing. I’m sure some of us went to those seminars that Scientific Atlanta had.

BAILEY: Well, I remember when Scientific Atlanta came out they were making government equipment at the time, and they got into this business because it had dropped off. It was the first serious thing...

QURASHI: They bought SKL.

BAILEY: They said their biggest problem was that they had to make a heterodyne processor for $3,000 and not $30,000 or more. That was their biggest thing to overcome.

QURASHI: AL used to be in that business, remember? And they hired me after I left Jerrold, started my own company. They hired me to reduce cost of their amplifiers. So I said, “Okay, it’s going to cost you $25,000,” and that was ’74. The guy said, okay, we’re going to give it to you. I took all their prints, changed them from mill spec to commercial specs. That’s all I had to do. The price dropped by $150.

BATALSKY: You go back to what Caywood said, some of the stuff, and what Bob was saying. One of the things that made Jerrold the success it was was the dedication of the sales engineers and the field engineers. We were there in the trenches with the people. We never left their customers out, no matter what happened. Most of us felt we didn’t work for Jerrold, but worked for the operators. A lot of the operators in the room won’t believe us because we wanted to get paid once in a while and we asked for money from them. They found that to be an objectionable thing at times.

QURASHI: Well, taking on that, when I came back with Jerrold in ’73, Lee Zemnick said, “Your job is there is about eight to nine million dollars outstanding on turnkey contracts. I want you to go collect them. So, hear me out, this one system, there were two guys, they were living there for two years, fixing the system constantly and wouldn’t leave. So I went there and I said,

“What is the problem?” They said, “Well, the system doesn’t work so I have not given you the acceptance certificate,” which was required. So what’s the problem? “Well, it leaks all over the place.” So I read the contract and went back to him, and I said, “Guess what? Tonight I’m going to shut the system down.” He said, “You can’t do that!” I said, “Yeah, but we own it. No money down! Turnkey.” So what we have to do is shut it down, they called the subscribers down and checked where the leak is. So we made a deal and finished that.

BAILEY: But that was the thing that we learned from it. By building the systems, by being involved in every segment of it, we saw where the fallacies were and made corrections to it, and in turn started developing new technologies for it.

(____?): But you know, all the technology in the world...

ZAWOJSK: A lot of it was feedback from customers, too.

(____?): Oh, we should get into that, yeah.

(____?): Oh, absolutely!

COOLEY: We needed the technology, and the fact is that in 1955 we were selling more equipment and more systems than we could design and there was no end to it. We were just getting backlogged more and more and more and more, and about the same time along comes
Hewlett Packard with a programmable calculator, and we had three guys... all the designers had three calculators and were going slow as molasses as January and we took these programmable calculators and made computer aided design systems out of them, and we tripled our design capability in a hurry. What would have happened if we didn’t have those things? We’d have been backlogged forever.

(____?): We would’ve died.

COOLEY: And what would’ve happened, even if we did that, when all we could pick up was off-air signals. Along came HBO. Now that was...

(____?): You had Dolan ahead of time.

(____?): Along comes satellite.

BATALSKY: Well, Dolan started Sterling Information in New York.

(____?): You’re jumping ahead.

BATALSKY: Things that started even before that was the ability for Jerrold to send somebody out and help, in fact, one of the things that a guy named Kip Fletcher, who used to be in charge
of a turnkey did one time, one of the systems... at that time there was no real standard about radiation, so if you were smart you could take a piece of 300 ohm cable, throw it over the cable system wire, and attach it to the back of your TV and you could get the signal because everything leaked. So there was a big sporting event on Friday night – Friday night used to be the fight night – and Kip rented a bunch of vans and put signal generating equipment, actually jamming equipment, and spaced it all over the city, and at five minutes to eight everybody turned on their signal generators. So anybody that was stealing signal couldn’t get it because it wasn’t on the coax coming into the home, and everything was jammed. He said on Saturday the phones were ringing like crazy with people signing up. So we even helped get subscribers because we couldn’t prevent the leaking from the system so we just jammed it.

BAILEY: When you got to the point where you say there wasn’t anything that we couldn’t overcome, I remember when the FCC decided that they were going to take over the management of the cable TV industry, and they gave a grandfather rule, right?

(____?): Oh, jeez!

BAILEY: And all of the sudden we had, what? Six months to get everything running. And all these people said, well, I want a system. The rules required that you had a headend of a

couple of channels and fifty customers. We became the greatest people of throwing up a couple of channels on a pole and running cable to an apartment house...

BATALSKY: And then strand, and strand all over the city – no cable – just miles and miles and miles of strand.

BAILEY: And there were like 500 systems that were put into grandfathering because we were able to do this. Nobody else was willing to step up to that.

BILODEAU: I know that one thing that prevailed throughout all of this, regardless of the technology, the marketplace, whatever, is that everybody in that company just had no concern for hours. Hours meant nothing, structure meant nothing. I never had a budget, Jerry never asked me to spend x, y, or z, he just said do it, and whatever I spent, I spent. It was like the runaway train, almost, and it’s not appropriate to say, as Shakespeare said, that some ships come to port that are otherwise not steered because it had a direction, and it’s just that it couldn’t keep up with the activity. The pace was so fast. I worked, many times, six, seven days a week, week after week, and go out and see the guys, go home, travel or and there. If any of you remember John Orasiki worked like an animal. John submitted a T&E once to downstairs, there was a guy downstairs who looked over...

(____?): Yeah, Nick George.

(____?): Nick George.

BILODEAU: And then Nick said, “John, how could you be in Chicago and in Dallas on the same night?” He submitted airline tickets showing that he was because he’d get on a plane at 3:00 in the morning and go set up a show in Dallas and then come back...

(____?): He’d never sleep.

(____?): It was amazing.

BATALSKY: John was a nut.

BILODEAU: Yeah, and John used to quit once a week. He would embarrass me for the time he put in. He would embarrass everybody just about.

BATALSKY: But John used to quit once a week. If Jerry Hastings, who was his boss at that time, would say something to John then John would quit. So one day Jerry calls me in his office and says, “John quit again.” I said, “Okay.” He said, “Go into his office, ask him for all his credit cards, and give him a box and say pack up all your personal possessions.” I said, “Why?” He said, “Because I’m going to share the stuff out of him.” So I go in and I say, “John, give me your American Express, your telephone...” at that time we had a rail travel card even because we used the railroad a lot. “Give me all your credit cards. Here’s a box, pack up your personal belongings. I’m to escort you out of the building.” He started to cry, he was, “Jerry, I’ll never
quit again, I’ll never quit again. Please forgive me!” Two weeks later, he quit again. That was his way of protesting, but he never quit. The guy worked like a mule though.

LOCKMAN: Can we go around the table and have people tell some Milt Shapp stories? First of all, Caywood, when you started in 1950, how big was the company?

COOLEY: Well, it was only a couple of years old. I started on December 1, 1950, so it was not early.

LOCKMAN: What was Milt Shapp’s role then?

COOLEY: Oh, he was the chief salesman, chief cook and bottle washer. There wasn’t anything happening in the company that he didn’t have a part in. He was everything, but he was also a good casting director. He hired some pretty good guys and everybody that was there was really doing a good job at what they were doing because that’s the kind of people he hired.

LOCKMAN: What was he like as a boss?

COOLEY: Oh, he was a pushover. I mean, he was not tough on anything. That’s why he hired Zal Garfield.

(LAUGHTER)

QURASHI: Yeah, but I think he kind of tended to expect that you didn’t want to do anything against him. I didn’t have too much interaction with Milt. The first time I met him I was a lab technician.

LOCKMAN: John, you have a story about when he called you up into his office and you thought you were going to get fired?

ZAWOJSK: Yeah, by this time, I ran quality control in the plant area and we used to wear these green smocks because you got a lot of dust around the electronic area. So the plant manager comes up and he says, John, Milt wants to see you upstairs in his office. I said, “What for?” He said, “I don’t know. He just wants to see you.” So I’m trying to figure out why Milt wants to see me upstairs? So I figure, I know. I used to know my job and I would say to my boss, well, we’ve got to do this, do that, in various jobs that I had because I was self-confident. They were tired of this cocky, no-it-all attitude of yours, you’re going to get fired. So I figured, well, at least this is class, I’m getting fired by the president of the company, no immediate foreman. So I go up and tell the secretary, I said, “Mr. Shapp wants to see me, my name’s John Zawojski.”

“Oh, go ahead in. He’s expecting you.” So she takes me in the door and says, “John’s here,” and she stands by the doorway and Milt jumps up, shakes my hand, he says, “How about a coffee?” Now at that time we didn’t have our cafeteria. The girl had to go down and go over a block to get
a coffee at Wayland’s Drug Store. I figured I’m getting everything I can out of this company before they drop the ax. I said, “Make it a big one.” So he sends her out for coffee, and Milt says, “Sit down. Now I guess you want to know why you’re here.” I said, “I have an idea, but I’d rather hear it from you first before I voice an opinion.” He says, “It’s easy, John, what do you think’s wrong with this company?” Now I figure he’s really setting up big mouth. He really wants me to put my neck in a noose. I said, “Look, Milt. You’ve got to be kidding. You’ve got guys up here making 2, 3, 4, 5 times what I make and you’ve got to ask me what’s wrong with the company?” He said, “Let me explain something to you John. Every week we have department head meetings. I got to this guy and says how’s everything going? Oh, wonderful, couldn’t be any better. Go to this guy, it’s terrific, going great. I got around and everybody’s doing terrific, but the company’s not doing terrific. What’s wrong with the company?” So I sat there for three hours telling him what was wrong. Just on structural things, like we didn’t have a personnel director at that time, two weeks later we had the personnel director, and that’s how Milt was. He always went to the troops to find out what the hell was going on.

LOCKMAN: Did he ever act on any of your suggestions?

ZAWOJSK: Well, that’s what I’m saying. One of the things was a personnel director and in two weeks we had our first personnel director.

(____?): Then he laid him off.

ZAWOJSK: Nah, they wouldn’t do it. I kept on asking for it. I volunteered and they wouldn’t lay me off.

LOCKMAN: Any other Milt Shapp stories?

KURPINSKI: I can probably thank John for getting the personnel director because I started with Jerrold as the first employee after the purchase of K&F Electronics, which was Val Kirk and Dave Fife. I was newly married, going to electronics school at night, and he my first child, and lo and behold, no sooner was my wife home from the hospital than there was a package delivery service at the door and there was a box. What is this? We open up the box and there is a blue baby blanket for a boy, and there’s diapers, and there’s just all kinds of paraphernalia and there was a card in there “Congratulations” and it was signed by Milt Shapp. One of the things that impressed me early on, and I was only 21 years old at the time, was that Milt Shapp really cared about his people. He cared about his employees, and when I come back to look at that in the ‘60s, Milt Shapp was probably 30 years ahead of his time because Jerrold at the time had affirmative action and EEO before someone even thought to coin those phrases. I think it was the

most ethnically diverse company I’ve ever worked for. There were blacks, there were Hispanics, there were Pakistanis.

(____?): Just one.

QURASHI: How I got to see Milt, he came to the lab one day and I’m coming out of my lab and he’s walking with Mike Jeffers and Bob Beiswinger down the road, and he sticks out his hand and says my name is... I didn’t know the company very well, I’d just started. He says, “My name is Milton Shapp, who are you?” I said, “I’m Mac Qurashi.” He said, “What do you do here?” I said, “I am a technician in the model shop.” He said, “Oh, you should go to school.” I said, “Well, I have a degree from England but not in electronics.” He said, “Well, you should go. You know, we’d pay for it.” I said, “I didn’t know that.” So he told Mike Jeffers, “Could you tell him everything,” and he walked away, and then of course he sat on my company’s board after he was a governor. By that time he would sit there and the same, very nice. He used to bring his dog to the board meeting, and I would say, “Those in favor, say aye,” and I would tell his dog, “Raise your paw,” and Milt used to get a kick out of that. He guided my company, me, how to do things, and it was great.

KURPINSKI: What was the year that the FCC put the moratorium on franchising?

BATALSKY: 1967.

KURPINSKI: ’67, all right.

QURASHI: First layoff at Jerrold ever.

KURPINSKI: Exactly. We went from 1,500 people down, I think, 300.

(____?): 500.

KURPINSKI: And I was working in the factory and the union at the time, and I know one or two days a week we used to do nothing but sit down and write letters to congressmen, senators, any politician we could, and that was joint effort that was sponsored by upper management and also sanctioned by the union. It was a pretty good relationship between the union and management.

BATALSKY: Considering that the IBEU is a very, very tough union, never, ever did Jerrold have any real problems.

KURPINSKI: We never had a strike, either.

BAILEY: The only time they had any problems with guys like me and other people who got grievances for doing things like stealing parts off the exception lines and going to the warehouse and stealing stuff the customers needed.

(____?): Or doing jobs that the union wouldn’t do fast enough.

BAILEY: It’s kind of interesting because what John was saying, it was a very ethnic diverse, not only just ethnic diverse, politically diverse because we had a guy up in the lab, Eric Winston, who was on the blacklist because they thought he was a communist, and Milt gave him a job, and we were still building for the government at the time, but Milt didn’t care. He said, “Big deal, the blacklist. This guy is good.”

QURASHI: When Milt came on my board, I said, “Milt, you and I are going to disagree on only one thing. You are a democrat, I am a republican.”

(____?): George Barco said the same thing.

(____?): Yes.

BILODEAU: That was a serious confrontation with George and Milt because of that.

COOLEY: Now, you’re talking about doing government work, do you know how Jerrold got into government work? Because of the test equipment. The stuff we were making for cable systems turns out to be exactly what they needed for the Bullpup missile. So I now become vice-president of sales for the Jerrold test equipment division, and working for the government is pretty tough, but I found one way to succeed. When they asked me to sign a quotation, and I had
to meet all these specifications, I took them in to Milt and I said, “Hey, look at all this stuff.” He told me, “Well, tell them where they can put it.”

(LAUGHTER)

(____?): Right.

COOLEY: And I went back and said, “Hey, we’ll sell it to you as is, right from our stock with our standard guarantee, and this is how much it costs, and that’s it,” and about a month later we got the whole order.

Unintelligible.

BATALSKY: But he had one bad habit. He walked around without shoes on.

(____?): And he played the violin.

(____?): Well, that was the worst part of it.

LOCKMAN: In the office?

BATALSKY: Yeah, he would walk around without his shoes. No matter what, he had his shoes off.

ZAWOJSK: We had some of the biggest Christmas parties in the world, and our company wasn’t that big at that time, and Milt would always play him violin at the Christmas party.

BATALSKY: And he played about as well as (???)

ZAWOJSK: Yeah, he was a frustrated violinist.

QURASHI: Did he try to write a play?

BATALSKY: Yeah, he tried to do a Broadway play. That went bad, too. One of the worst experiences I ever had with Milt was one of the things I used to do is put on the special events for the company, parties and so on, and Milt really got interested in politics. This is before he ran for governor. At the Bellvue Stratford Hotel, there was a county commissioners’ convention,

there are 67 counties in Pennsylvania, and Milt said, “I want you set up a hospitality suite, I want you to treat these guys,” so I said, okay. So we go down there and I get the captain’s row with the guy carving, and we have a beautiful bar set up, and I’m sitting there listening to this scum of the earth, these guys who work for the county commissioners, political hacks...

(____?): Can you bleep that part?

BATALSKY: Saying the worst things they could say about Milt as they’re drinking his whiskey, eating his roast beef sandwiches. When it was all over, I said to Milt, “Whatever you run for, I’ll write a check.” Don’t ever ask me to come near any of these politicians again. I said they’re the worst people I ever met in my whole life. And that was it. But he really believed.

QURASHI: That’s not only the commissioner. ’68 convention in Boston, remember with the boat show team?

(____?): Yes!

BATALSKY: Showboat.

QURASHI: Showboat. So I was dressed in the showboat...

BATALSKY: We all were!

QURASHI: Yeah, and a table of ten or fifteen, and who comes in? Jim Palmer. And he brings his customers.

BATALSKY: Yeah, now this is the competitor, C-COR Electronics.

QURASHI: And he sits down and the only thing he’s saying is Milton Shapp is this and Milton Shapp is that, and Jerrold is terrible, and this and that. So I said, “Mr. Palmer, I don’t know you,” I was only in this country about six or seven years, I said, “I don’t know you very well. I’m just a technician at Jerrold, but you know, if I was eating my host’s food and I was drinking his wine, at least I’ll be gracious enough to say thank you instead of doing all that.” Immediately those customers started to talk to me. I think we got them. But Jim was funny, when I started my company he called me up, he said, “Mac, I want to build a new amplifier. Would you consult for me?” So that was ‘70s and I said, “Yeah, I’ll charge you $2,000 a day, you’ve got it.”

BATALSKY: We used to have entertainment nights at the national convention. It was open to everybody. So that’s how with Jim Palmer, and the one they were just talking about, I think Bob has some pictures from it, we all got dressed up... it was July 4th weekend, we were over July 4th weekend, it was hotter than Hades.

QURASHI: The air conditioning broke down.

BATALSKY: The air conditioning broke down at the Sheraton, and we were all dressed in these heavy costumes.

(____?): Riverboat gambler type motif, basically.

QURASHI: Sweat was pouring down the back.

BATALSKY: Colonial times. (Looking at photo) The guy in the middle was Jerry Hastings, this guy without the beard is me. Who’s the Indian?

(____?): Sal had to be up there.

BATALSKY: Bob Toner in the corner, Jack Ford, Frank Martin. I don’t know who the Indian is.

(____?): Probably Sal.

BATALSKY: Who’s the Indian?

BILODEAU: His name was Joe?

QURASHI: Joe Vargo?

ZAJOWSKI: No, he was production.

BILODEAU: We used to rehearse for weeks to get this production, and we brought all these costumes from Philadelphia, from a guy here in Philadelphia named Pierre Costin, and we put on these outrageous skits. This is in front of our customers. And have a dinner with them. And then we had to sit in these stupid costumes, which were 100% wool-polyester, so they never breathed, and entertain the evening.

QURASHI: It was hot.

BATALSKY: Some of the people here in the audience had been to those things and remember them. But the group here, part of us and the people we’re talking about, we were always hands-on. We knew our customers, we knew their families, we lived the systems, and we made mistakes. We came out, we were talking about Johnny Walson at Service Electronic, we came out with a set of equipment called Starline One, which became the first two-way equipment we ever made because we shipped it out, they shipped it back, we shipped it out, they shipped it back... that’s Jimmy’s line there. But Johnny Walson comes down to see Milt and Bob

Beiswinger says, “I want to buy Starline equipment, Starline One, but I don’t want the housings.” Now the engineers at the lab said this stuff works, and Johnny looked at it and said, “It’ll never work.” He was buying it without the aluminum housings because he knew it’d overheat, and he was putting it in the old weather-proof housings up in Allentown at Service Electronic, until all these came back and got corrected and got fixed, and then Starline 20 came out.

BILODEAU: They didn’t all come back. There’s still some of them out there.

BATALSKY: The further north you went, the better they worked. As long as they weren’t in the sun they were fine.

QURASHI: In defense of ??? the problem was that RCA gave us the wrong...

BAILEY: You also talk about the things Caywood was referring to, we had schools and we trained our customers on the equipment, but I believe a lot of them really came because as part of the training process - there was a week long school? We’d take them to the Latin Casino over in Jersey, right? And they’d come back and say, “Wait a minute, this is like the fifth time you’ve been back.” He said, “Yeah, I know but I haven’t seen the show.”

BATALSKY: We were at the Latin Casino one night with a whole group of people, and it shows you how the times were, how gullible people could be at the time, there was a group of young women celebrating an engagement party or something, a bachelorette party, and they were taking all these pictures. Somebody next to me said, “Go ahead, do it.” I said, “Okay.” So I walk over, and we were all in suits and ties at the time, we were supposed to be gentlemen, and I walk over to these young women and said, “You took pictures of our table, I’m very sorry, we can’t have our pictures taken. Can I have all your cameras? We’ll have the film developed and
whatever has to be airbrushed out, we’ll do it and return them to you.” I got seven cameras. They handed me all the cameras! They made me give them back though, I couldn’t understand why.

LOCKMAN: Can you talk about some of the systems you worked on and you were out in the field building?

BATALSKY: Oh, could we ever!

BAILEY: Again, some of the ingenuities, there was a company in Virginia that was a small MSO and they asked us to build a system in South Carolina, and they gave us... they said, “Look, we’re not going to tell you how to do it, we’re just going to give you... we have the franchise, we’re going to give you the maps,” and they gave us the maps. We designed it, we engineered it, we set up for the construction of it, we did everything, we laid it all out. And at the end of it, the chairman said to us, he said, “I like your presentation but I have one question. We

need this done by a certain time,” we’re sitting there going, well, we designed it, we’ve engineered it, we’re set for construction, we put in the rain days and everything, and said we’ll get it there on time. And he said, “Then I want one condition on the contract,” and we said, “What’s that?” He said, “Well, it’s done in four phases and every phase that you don’t meet the timeline, I want a penalty of $100,000.” So I bring all this back, and at this time we had a new president and he was trying to show that he was going to be a hands-on type president, and he’s looking at this and he’s got all of the people that are heads of the different divisions, and he’s
saying, “Is this a good contract?” We said, “Well, we’ve designed it, we’ve done this,” “And this penalty of $100,000?” “Well, no problem, we’ll make it.” So he’s getting ready to sign it and before he does he says, “Okay, you’re the salesman, is there any reason I shouldn’t sign this contract?” And I said, “No, it’s a great contract.” “Is there anything I should add to this contract?” And I said, “Just one thing.” He said, “What’s that?” I said, “The first check for $100,000,” and he went ballistic. He said, “Wait a minute. You’ve already told me we’ve done everything, why should I put the check in there for $100,000?” I said, “Because this is a turnkey system and we’re in cable. I don’t care how much we factor in there, we’re not going to be on time.” It was a system we ran into where shielding came in there and we had to redesign the fittings, the VSF fittings for the radiation shield.

QURASHI: Was that the Della Cable System in Spartanburg?

BAILEY: Yes, Spartanburg! There you go! And we had to spend about another five months and maybe a half a million dollars in developing new fittings.

QURASHI: I remember that. I was involved in that when I came back.

BAILEY: And we set up a whole industry spec on those because of the radiation...

QURASHI: See, when General Instrument got out of the construction business in 1974, and that’s when I took over, my company took over some of the contracts and we started building turnkey systems. So we built a lot of telecable turnkeys. We built United Artists turnkeys, TCI turnkeys, but I learned that at Jerrold how to do it, and that’s how we did it.

BILODEAU: Brian, there was another version of sale that Jerrold engaged in. It was called a telephone leaseback. You get a private customer who gets a franchise, builds the headend, there’s an interface, think of it as an interface physically, headend stops here, the phone company picks up at this point, and they build all the plant – we build it for them and sell it to them – and they charge a lease figure. They own it, they are charged a lease figure to the owner of the franchise.

LOCKMAN: The phone company would lease it?

BILODEAU: Um-hmm, yeah. Well, I mentioned Port Huron in the little skit. Skits are, by the way, legendary in this company. We all had skits.

(____?): We didn’t get paid much.

BILODEAU: The customer put up his headend, Michigan Bell supervised the construction of the system by insisting on certain standards and certain miles be built and so forth. We spent two
years trying to spec that system to proof it out for them because it really didn’t work. All the customers you’re hearing about all over the country who bought and paid for entire systems, they weren’t so particular. You got a picture down there, you started selling pictures, and after that they were locked in. But Michigan Bell said, “Wait a minute. When the temperature goes up and down 20 degrees it waves at the end and we want to fix that, we want to fix this.” Well, we spent two years trying to get this stuff to work, and eventually we changed it all out. But that arrangement between a private owner of a franchise, contractor, i.e. Jerrold, selling the equipment, building the system, and the relationship between the phone company and the franchise owner, it was a circle. It was a vicious circle. They always blamed the problem on each other. The telephone company blamed the headend, and the private guy would say, oh, it’s the system, and we’d say whatever.

QURASHI: Bob, that problem which came into Michigan basically woke up us in the product development end of it.

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  BACK TO ORAL HISTORIES

Marvin Jones

jonesMarvin5

Interview Date: Monday April 30, 2001
Interview Location: Denver, CO
Interviewer: Tom Southwick
Program: Hauser Project

SOUTHWICK: This is part of the oral history program for The Cable Center. It's April 30th of the year 2001, and we are at the AT&T studios and headend in Denver, Colorado. My name is Tom Southwick and with me is Marvin Jones, who's one of the key executives in the cable television business, was present and involved with many of the key decisions that made the cable business what it is today. Marvin, I'd like to start out, if I may, asking you where you were born and a little bit about what it was like growing up for you.

JONES: I was born in Phoenix, Arizona in 1937, and I was an only child. My parents lived there all their lives and I went to school in Glendale, Arizona, up to the first year in high school, and then I left town, or left the state. I did a variety of things; I got involved in the cable television industry in Globe, Arizona, which is the place where Bruce Merrill first started his systems back in, actually I think he started in '55 or somewhere back in there. I went to work in 1959 or '58, I'm unsure which year, but it doesn't matter all that much. I had a great ride.

SOUTHWICK: How did you get the job?

JONES: It was interesting how that came about. I used to race motorcycles years ago, when I was a young man. I worked in a smelter machine shop; I was an apprentice machinist in Inspiration, Arizona, which is in between Globe and Miami, Arizona. I think the town is gone now. It's only reason for being there was because of the open pit mines and the smelters and so forth, and they've all been closed down. I met a young man named Ron Harmon, who was the brother of Homer Harmon, who was managing the system for Bruce Merrill at that time, and also was building systems around the various, in the state, and also in Michigan and Texas, and some other states like that. Ronnie was going to school and after he got out of school he would go to work part time at the cable office, and he was an installer technician. Back in those days, you had to be able to keep the system running, repair amplifiers, install drops, just general all around activity. I met him at an impromptu drag race that was going on, which I proceeded to beat everyone there, and Ronnie and I got to talking and I asked him what he was doing and so forth, and I got to riding around in his truck with him after I got off work from the machine shop at about 3:00 in the afternoon. That was about the time he would go to work, and we would be out until 7:00, 8:00, 9:00 o'clock at night keeping the system running and so forth, and I thought that was such a fascinating job to have, to where you had a vehicle to run around town, you're outside all the time, you set your own hours, you're really active. I asked him about trying to get a job. As it turned out, Homer was going to see St. Marie, Michigan, to build a system for Bruce Merrill up there, actually it was a turnkey job, I believe, and so that created an opening, and I applied for the job. I received it, took a $50 a month cut in pay, worked twice them number of hours a week, and loved it ever since. I've just done everything that I can do in the operational side of the business.

SOUTHWICK: Do you recall what it paid?

JONES: I think I went to work for $350 a month. I'm almost sure that's what the number was. I think I was making $375 or $400 or something like that at the smelter at the time.

SOUTHWICK: Were you aware of cable television before this experience?

JONES: I'd never heard of it. I didn't have any knowledge. I wasn't a television fan or anything else, so it was an all new industry to me. It was fascinating. We had three channels at the time on what was called a strip system, that each amplifier amplified each channel, and you had open wire throughout the town and various places, you had a cable called K-14 that was used to run power up the mountain and bring the signal back down the mountain, which is obviously highly illegal, but it was the way to get the process handled. You used tuners out of television sets to actually tune the channel. We had 3, 5, and 12, I believe were the channels out of Phoenix. You had just plain old antennas sticking up on top of the mountaintop up there and fed it down.

SOUTHWICK: Did you have an engineering background, or electronics, or anything?

JONES: No, I didn't. I'm mechanically inclined; I have an aptitude to things working. I'm not a trained engineer or never was a trained technician, but I was able to repair things. I knew what needed to be done, but I could care less about how the amplifier worked, I just knew that if it didn't work what would happen and so forth.

SOUTHWICK: And were people able to get television in this town without cable?

JONES: No. You could not get anything off the air. There was a translator system that was there that was on the same mountaintop that we were that used UHF frequencies and broadcast - actually it wasn't UHF, it was VHF, but I think they had three or four channels as well, and it was a subscription service, and so forth. That was our competitor. I can remember we used to shake the power lines, try to get the signal to go off up on the mountaintop because our signals fed from the bottom, so we'd get customers to sign up for us. We would build a block of cable at a time and take the installations fees, which were $150 at that time, and build the next block, and that was kind of a bootstrap...

SOUTHWICK: Self-financed, basically.

JONES: Yes, at that time. I was very much involved in the construction of systems and I liked that very much. I went on to help build Yuma, Arizona, and El Centro, California, and Brawley, and all those systems. Later on, we built San Antonio after the company changed and Bob Rosencrans came along, but I was always active in the construction side and the maintaining side, and then at one point I decided management looked better to me than standing out freezing on a pole, so I applied myself, went to night school and learned some things, and became manager of the systems.

SOUTHWICK: What was your relationship with Bruce Merrill? Did you work directly for him?

JONES: Well, I knew him and met him and spent a lot of time with him, but I didn't work directly, direct report to him, except for a brief period of time when I was in Page, Arizona, when we were building that system, when they were building the Glen Canyon Dam, that system reported to him at the time. But mostly I reported to people like Homer Harmon, or Dave Montechard, who was the manager of the systems at Time, and then Homer went later to Yuma, Arizona and El Centro, California to build those systems and I worked for Homer there. I was a construction superintendent on them. After we finished building them, I managed the Yuma, Arizona system, and later on the El Centro system, and I was managing them at the time Bob Rosencrans' group, with Columbia Cable bought them from Bruce Merrill.

SOUTHWICK: Now Bruce Merrill was also a manufacturer of equipment.

JONES: He was. He built the first transistorized amplifier, and the company was called AMECO at the time. He built all of these electronics when I was with him. They built the first, what they call low-band amplifiers, which was a combination of actually 2 through 5, and then they had broadband, which was up to channel 12, at the time, and then went to the transistorized amplifiers, which were first put in, I believe Santa Barbara was the first place they went, and when we built the Yuma system, we spaced it for amplifier spacing for the transistorized amplifiers when they came, but we put tube type in and then changed them out afterwards.

SOUTHWICK: And what was the importance of transistorized amplifiers versus the tubes?

JONES: You had the ability to carry broader bandwidth, and you also had the ability to go further distances between amplifiers. The signal was much cleaner. You didn't have the... We used to have what we called wipe, at that time. It was cross modulation between channels, and a variety of different signal difficulties that the transistorized amplifier cleaned up. Much lower operating costs, you could put the amplifier just about anywhere, power it by DC power down the cable rather than having to have, in those days we used to have to put a meter on every pole where we had an amplifier, a tube type amplifier, a tremendous current drain and you were limited to how far you could go with them. So it in general was... It was the same difference between tube radio and a transistorized radio. It's similar. They do similar things, but much more efficient.

SOUTHWICK: Did the first ones work right?

JONES: No.

SOUTHWICK: Why not?

JONES: No, they didn't. Well, it was new technology. The designs themselves, there was what's called a trunk amplifier and then there's a bridger or feeder amplifier, and the circuitry were different in them, and it used different paths, which were devices used to adjust the signal coming into an amplifier to get it at the right range. If you get it too high it will overdrive it and create different problems; if it's too low, it's noisy. When we got those amplifiers, no one told us that the paths you use were different for the two types, one's resistive, one's capacity. If you mix the two you wind up getting ghosting everywhere. We spent three weeks trying to find where all the problems were until finally an engineer came from Phoenix and spent time – they wouldn't believe that... they thought we were doing something wrong to make it work, and we finally discovered what the problem was, but once you got through what I would call the birthing of the technology they worked very well.

SOUTHWICK: And what was Bruce Merrill like in terms of his role in the industry and his style as a manager, I guess?

JONES: Bruce was an interesting person. He was a CPA by training, and I think somewhat accidentally got into the manufacturing side of it. Or maybe accident's not the right word – in order, in those days, to build systems and deliver a product that would work, you almost had to build your own, if you will. There were very few manufacturers of amplification equipment. I'm trying to think of some of the names; it's been so long since I've thought of them, but they're not even around anymore.

SOUTHWICK: There was Spencer Kennedy, and...

JONES: Yeah, well, that's exactly what I was trying to think of, because I think they had some of that equipment in there. He got into it, I think, out of self-preservation, in order to just make the product work or get something that you could control it, but he was enough of a visionary to see that the demand for the product, the television signals, was great, that this was a business. He was quite good at using OP, which was other people's monies. He always seemed to be just a little bit behind the curve as far as the amount of capital that he had to do what he was trying to do. He was trying to get, like a lot of the older pioneers did, acquire as much area and as many franchises and build as much as you can in order to beat out other people who were trying to do the same thing. As an individual, I liked him. I still do – he's still living, and he's quite a nice guy. He, unfortunately, was let down by, at least he believes it, by his engineering department, by not coming up with a second generation of the transistorized amplifier, which Jerrold captured the market. There are a lot of reasons why that happened, and I'm not one that could really intelligently tell you why, but the fact is it did not come out, and the next generation was far superior to the AMECO equipment, so it wound up being sort of a second class citizen in that case. Also, he ran into some financial difficulties where he needed to sell off the systems that he had. He got into cable manufacturing, which turned out to be maybe a mistake, and Time Cable and some others were better equipped to do it then what he was at the time. So he wound up needing to sell the systems off, which is how I happened to wind up with Columbia Cable and Bob Rosencrans, because they came through and were looking at systems to buy that were in the West. They had Pendleton, Oregon at the time, and Kennewick, Washington – I think Pendleton first, and then they bought Kennewick later, but that was where they started at, and then they bought the Yuma systems and El Centro systems and allowed me to keep managing them, which is what I owe anything I've acquired or accomplished in this industry to that fact.

SOUTHWICK: The equipment business in the late '50s and early '60s, if you didn't build your own, you tended to buy from Jerrold, because they were really the only game in town.

JONES: That's correct. That's correct.

SOUTHWICK: How did they operate, and what was the relationship between Jerrold and the cable operators that they supplied?

JONES: The problem we had with Jerrold was that they tended to be a competitor as well as a supplier because they were building systems as well, and that was also a problem with AMECO, they were the same thing, but they recognized that they needed to get out of that and they changed course. Jerrold would be – if you were going to buy your product from Jerrold and you were going to try to do a turnkey in a system that you had a franchise for the tendency would be to take care of themselves as opposed to you. So, you may find yourself needing a certain number of amplifiers that you couldn't get because they were going somewhere else, and as it turned out they were going to their own systems instead of ours.

SOUTHWICK: Into systems they owned.

JONES: So there was quite a problem there for a number of years, until management, I guess you would say, became enlightened and decided this is really not the thing to do to try to compete with your customers because it became very apparent you need to be in one camp or another. It's awfully difficult to be both the manufacturer and an operator, and so they made the decision to get out of it. But we had, until people like RCA and others developed the equipment, it was pretty tough. That was one of the reasons why in San Antonio we went with the RCA equipment rather than Jerrold, just because they had not exactly been stellar in their performance.

SOUTHWICK: Which systems were you running for Bruce Merrill when Bob Rosencrans came around?

JONES: Yuma, Arizona; El Centro, California; Brawley; Holtville, and Calexico, California. They're all grouped right there right along the border with Yuma of course, obviously, on one side, and the others in the valley on the other side.

SOUTHWICK: In California?

JONES: Right. Which were systems that I had built, physically, I was a construction superintendent for those under Homer Harmon, who was running them at the time. When Bruce decided to sell them, there were several different buyers that came through. I remember Bill Daniels came through because he was brokering some, and as an interesting kind of little aside, he wrecked his airplane there. Well, wrecked is not the right word – he ran off the runway and into the bar ditch because they blew a tire on takeoff and the pilot aborted. The airport in El Centro runs at an angle to the highway; they've since changed it, but at that time you had a very real possibility of something happening and going into the highway. The pilot turned it sideways and skidded into the bar ditch, and he was coming to Yuma to see me.

SOUTHWICK: Anybody hurt?

JONES: No, no, it didn't hurt anybody. It hurt their pride.

SOUTHWICK: Bill wasn't flying himself?

JONES: No, no, it was the pilot.

SOUTHWICK: Was that your first meeting with Bill Daniels?

JONES: Yep, yep.

SOUTHWICK: How did he strike you? How did he impress you?

JONES: He was the most outgoing, straightforward, "Hi, I'm Bill", type individual that you could meet. He was a class act in any way you want to describe him.

SOUTHWICK: And when Bob Rosencrans came in and bought the systems what happened to you?

JONES: That was an interesting experience, and Bob loves to tell the story and I kind of get a kick out of it too. When he came to visit the systems and see what they look like, they flew into Phoenix, and I picked him up in my car, which at the time things were tight and we didn't have a company car, I just had a personal car, without any air conditioning, and it was summer.

SOUTHWICK: Ooh!

JONES: It was in June, June of '65, I think it was, or '67. When was the Six-Day War? '67?

SOUTHWICK: Um-hmm, yeah.

JONES: That's when they came through. And it's of course so hot and everything. He'd never been west before, never seen the desert before, and was really taken by it. We did the tour of the systems and I guess he saw something there, and as it turned out he was right, about what could be done with the systems. I was fortunate in that he evidently felt that I could help that along, and I became the manager of the overall property, all three of them, a regional manager is what we called me then. It worked out well.

SOUTHWICK: What did he do with the systems after he bought them?

JONES: Well, we just improved them. We expanded them and added channels to them, and did the type things that needed to be done that Bruce didn't have the funding to do at the time. We used those systems and the Kennewick, Washington systems to help take the company public, and almost immediately after that struck a deal with the systems that Ken Gunter had at the time over in San Angelo and Vero Beach, Florida. We also did a deal with United Artists, which allowed them to become 25% owner in the company, and that's where the name UA Columbia came from, and it allowed us to grow at a... we did it at a measured rate. Bob and Dave Strassen, who was the chairman of the company, was very mindful of the balance sheet, did not want to be highly leveraged, did not want any of the franchising wars, although they did do some activity in the east. Chuck Dolan and Bob were going head to head on a lot of New Jersey systems and so forth, but you picked the places that you knew you could operate and not be highly leveraged and so forth. They were very conservative in their approach.

SOUTHWICK: What is it about Bob Rosencrans? I mean, here's an Eastern, Ivy League educated guy who's never been West, and comes out and meets a guy who's more or less self-educated...

JONES: That's right.

SOUTHWICK: ...from Arizona, and yet forms a friendship that's lasted many decades.

JONES: I think it's the special nature of Bob, himself. He very much allows people to do what they're cable of doing, and encourages them to do, and lets you do it, if you will. The interesting thing about him – the first budget we ever did we sat down beside a pool with a yellow legal pad and it took about 30 minutes for us to create this budget for this Yuma and El Centro systems – capital budget, obviously – and certain projections on what we thought we could do customer account-wise and growth-wise, and I nicknamed him the "fastest pencil in the East" from that point on because he was uncanny in his ability to make a judgment and be almost entirely right every time about what a system growth ought to be, what it should do, but yet he didn't try to run it. He allowed us to run it, and I learned an awful, awful lot from him on how to manage people and how to set goals and how to step out of the way and let people do their jobs. As to how we happened to hit it off, I don't know, it's just the way... It's my good fortune that we did. I take great pains to tell everybody that, too. I have the highest regard for him.

SOUTHWICK: And Ken Gunter was also part of the sort of trio there.

JONES: Yep, yes he was. He and Ken really hit it off well. There's an interesting dichotomy, if you will, because there is a Republican and a Democrat. They couldn't be more...

SOUTHWICK: And a Texas conservative versus an Eastern liberal.

JONES: Oh! The arguments, well, not arguments, debates they used to get into were just fascinating. I used to love to sit and listen to them because they were really going at each other, but they still do have the highest regard for each other. And again, when they made the deal for San Angelo and Ken was going to become involved - I was manager of the whole Western group and I was flying my own plane at that time, because I had responsibility for New Mexico, Arizona, Washington, and Oregon, and back in those days airline service would take you about 11 hours to get up there because it was a whistle stop, they stopped every other hour or so. So I learned to fly and would fly back and forth, so when Bob asked me to go to San Angelo to do due diligence and meet Ken Gunter and to see what I thought about him, because they trusted my judgment at the time, well, I flew out there on my plane. Ken actually didn't even meet me at the airport. You've met him, I know you know him, he's a pretty independent, free-thinker type person, and where I would have went to the airport, he would not. It's just the way he is. So I came to his office and he found out that I'd flown in my own plane, and he was just aghast because he at one time had scared himself pretty badly in an airplane. He got caught up on top of cloud cover and had to descend and really put the fear in him, although he now flies. He flies all over the place now, but at that time he didn't. My first impression of him - and it was borne out - was that this is not a guy that was going to be working for me, it was going to be the other way around. He was just too smart and too - I don't know what other term I would use for it, too independent, probably, that's probably a better term - to become a regional person or... I mean, that wasn't his thing. He very much had a vision engineering side, and business-wise too, he's a pretty smart business person, he comes up with some pretty good ideas, but Bob was the best at that, and Ken was the best at the engineering side and the concepts of what we ought to be doing, and they made a wonderful team. It was really... a lot of good things came from that, but when I came back that was the first thing I told him, I said, "We need the systems. We need Ken with them, but he's not going to work for me. We need some other role for him." And it turned out to be the right one, too.

SOUTHWICK: And what was that role?

JONES: He actually became executive vice-president and he was in charge of all the engineering concepts and thinking, and so forth. When the concept of satellite delivery first came out he was very quick to say this is something we should embrace, and here's why, and was able to explain in terms that people like myself, and Bob, and Dave Strassen could understand it. Besides getting away from the engineering side of it, think about the whole ability you're going to have by doing this, and that was a big reason where Bob stood up to Jerry Levin and said, "Put us down for seven of them." It was an interesting decision making.

SOUTHWICK: Before we get away from the kind of regional manager role, what was the relationship that you had with the cities and when you upgraded systems in Yuma and El Centro, and so forth, were you able to raise rates in order to get your money back, or how did the financing work sort of at the local level?

JONES: We, at that time, and actually throughout the whole life of the company, never used promise rate increases or internal budget rate increases as a method to justify funding to do upgrades and so forth. We went at it differently. Bob... another one of the lessons I learned from him, and this still works today, I think, was to get the best possible product together that you could get that the customer wants to buy. So you need to know what it is, number one, and of course back in those days it was very simple, there wasn't a whole heck of a lot around, so...

SOUTHWICK: It was broadcast television stations that you were bringing in from elsewhere.

JONES: That's right, and the independents from LA, which were brought by microwave back then. But when satellite finally came about, and then you start upgrading the systems because you had additional channels to offer, we went at it with the concept that we would set the capital budgets predicated on increased penetrations, not rate increases. We were always very conservative in raising rates. I remember I've got an article somewhere I happened to run across when I was looking at things here that when the rate regs was taken off the industry and the rates were starting to be prominently, if you will, increased, I made a statement that we just were not going to do that because you're punishing your customer for no good reason. You don't raise rates just to get more money, at least in our business philosophy. You want a fair return, you want the shareholders to have a fair return, you want the customer to pay a fair rate for a good product, and that was our philosophy. So, we did not do more than we could reasonably afford to do. We never highly leveraged ourselves. As I mentioned earlier, we were very concerned about having a decent balance sheet, so we always paced ourselves. It was always a struggle because the way we went at our budgeting process was each of the managers came in with their requests for their next year's capital spending, and they had to justify to everyone of the managers why they needed their money and we had a limited amount of funds to deal with, so you'd better sell a good story. On the other hand, you can't just always let the best or the most desirable get it because you wind up then skewing your business, and the bottom tier can never catch up because they can't get any funds. So, it was an interesting balancing act, which I enjoyed. That was one of the things that I wound up having an affinity for was the budgeting and operating and meeting numbers, and so forth.

SOUTHWICK: And that was on an annual basis that you'd meet with everybody?

JONES: Yes.

SOUTHWICK: About this time, late '60s, the federal government made some decisions in terms of limiting the amount of distant signals you could bring in and other restrictions. How did that impact the business at your level?

JONES: Actually, what happened to us at that level, and I wasn't as plugged in to it then as I became later on when I became president of the company, but we quit spending, is what you did, because unless you could gain additional subscribers we felt like it was not... it was against the company's best interests to just keep building or going out and acquiring other franchises. So, it stopped everybody and we just concentrated on doing the best we could and gaining as many subscribers as you can, and using those funds to obviously build whatever you need to get done.

SOUTHWICK: Talk a little bit, if you will, about the financial philosophy, I guess, of Columbia International, as I guess it became.

JONES: Well, the second generation of the company was Columbia International. Originally it was UA Columbia, and that, to answer your question, and then I'll talk a bit about...

SOUTHWICK: Excuse me, Ken Gunter was the UA...

JONES: No, no.

SOUTHWICK: No? How did that evolve?

JONES: UA came about through a purchase we made shortly after we did the – let's see if I get my dates right – the first deal we did was with Ken and got their company, which was International something or other, was the name of the company, but that's not where the International came from. We did a second deal with a stock transaction after we went public for some systems in Texas and in Tennessee, and they were systems that were owned by United Artists Theaters at the time, and they acquired, or we did sort of a merger where they wound up with 25% ownership of the combined companies, when we added their systems in and ours and so forth, and that became the name of UA Columbia Cable, was what the name of it was, or United Artists Cable later. But that was after we'd already acquired... Ken was part of that transaction at the time, and UA stayed with us up until the original founders of Columbia wanted to cash out. That required... it was quite an interesting vote because the United Artists people didn't want the sale to take place because of a capital gains problem that they had. They didn't want to pay the taxes, and the way they finally got around that whole exercise was to find a white knight, which was Ted Rogers. Rogers and United Artists Theaters took the company private and bought the company and renamed it Rogers UA, and later on they split. It was an interesting... they set a document in place that allowed, in case they didn't like each other, they could get "divorced". I think in some ways it's like a prenuptial agreement, if you're not careful you're predicting what you're going to do.

SOUTHWICK: You're going to end up fulfilling your own predictions.

JONES: That's exactly right, which they did. They clashed repeatedly, but that's kind of the history of how the names go about, and then later on, Bob and Ken started another company called Columbia International, and that's where that name came from.

SOUTHWICK: Right, but the original Columbia in the late '60s and early '70s had an economic philosophy, I guess, that left it in a bit of a different position. I mean, some of these companies, including TCI, United, and others, were on the brink of financial disaster during much of that period, but Columbia was not. Why not?

JONES: Two reasons – well, several reasons, but the two predominant ones was a conservative philosophy about debt, and they were very mindful, although I never heard the word leverage ever used until after the TCI days and so forth when the high debt leverage companies came about you start talking about leverage of 8 or 9 times cash flow, and we'd never thought of things that way. It was strictly an ability to what can you manage, how can you run the business. That was, I guess if there's any one, clear, single philosophy, it was being able to run the business properly, which means you have to have the proper funding in place, you have to have the proper staff in place, all the things that you do rather than taking an opposite philosophy that TCI, for instance, did. It's just a difference of philosophy, not an indictment one way or the other. Their position was to acquire as many as they could get and use the fund, any cash flow generated by what you acquired to leverage it and buy something else. It was strictly...

SOUTHWICK: A growth.

JONES: A growth. Our position was always to try to find the best value for, you know, originally it was private shareholders before we went public, and they were all conservative in their investments and were looking for significant returns. You don't get it by leveraging unless you've got a heated economy or other things happening. So that was kind of the guiding force to it. We deliberately did not get caught up in the franchising wars when those took off; we picked our spots in New Jersey and the East. There were a lot of systems that were contiguous that we wound up acquiring and we were going head to head with Chuck Dolan at the time. We bowed out of systems like Boston and others. We were just aghast at the deal that they struck, you know, and it turns out... you know, I don't say that either one of them was wrong, because if you look with the benefit of hindsight, Chuck's done very well. Everyone kept predicting "he's not going to make it, he's not going to make it", and he's doing pretty fine, I think. On the other hand, we did too, but we didn't want to become the biggest or the greatest or anything, it was just run a business you enjoy and have fun doing it.

SOUTHWICK: What difference did it make to you in terms of being a public company versus a private company?

JONES: My first recollection of the difference was that it gave us something else to do deals with.

SOUTHWICK: The stock?

JONES: That's correct. It was a way to do deals without trying to go to banks and creating a package there and that is what created the merger with UA and International and so forth. As far as my experience in operating, at my level, it really didn't make a difference.

SOUTHWICK: No additional reporting required or anything?

JONES: No, not for me. It did at the corporate office, but I was insulated from that because I was just the operating guy.

SOUTHWICK: And when did you first become aware of the possibility of satellites as a means of communication that might be of use in the cable television business?

JONES: Well, Bob Rosencrans and Ken were – I don't know if they're unique – but they were very mindful of telling people what was going on in the company. Our company was so small and Bob would call all of us once a week, or sometimes, daily, depending on what was going on, and would share with us what's going on. So, like, when CNN was thought about, and when Levin was talking to him about satellite delivery, and of course we were looking for ways to add pay services to all of our systems and were running into the problem of the device that ate cards. Who was it that did that? He was out of... it was a guy out of LA that developed it.

SOUTHWICK: Yeah, then John Saeman started working for them and I can't remember.

JONES: I've forgotten now what his name was, but we were all searching - all of his in the industry – searching for some mechanism to grow the business further with something unique, and pay television, or uncut movies, as we called them back then, was very much the way to do it, but bicycling tapes is not going to work. By the time you start extrapolating what this industry could become there's no way you could do it. We tried to do it for awhile and...

SOUTHWICK: And microwave is the other option, which worked in New Jersey. Did that work out West?

JONES: Well, the problem is the FCC took the licenses, changed the frequencies on us, and you had to go with CARS bands, and CARS band is not a long haul capable type technology. AT&T was a long haul carrier at the time, and they were terrible. They had no interest in video, they really saw us as a threat. I mean, it was really not a very comfortable working relationship with the division that had the microwave, so there had to be some other way to do it, and Jerry Levin and his board, in backing him, is really what created this industry to where it is now, and people like Bob and Monty Rifkin did, at ATC, but there's certain discussions about who did what first, but anyway, the fact is the two companies committed to build the earth stations, and we committed for seven of them, and Monty did for one. It created the event that changed the whole industry, made the industry what it is.

SOUTHWICK: And from an operational point of view, in the systems that you were running, what was your thinking in terms of how this would work financially? I mean, if you're going to spend, I think it was $100,000 per earth station in those days...

JONES: That's correct.

SOUTHWICK: How do you make your money back? By selling HBO?

JONES: That's exactly what it was. We had projected it out, and you had a 50% margin, which you were dealing with, you were selling it for seven bucks a month, it was costing you $3.50, you start adding the numbers up, you know, if you get enough penetration it works. And at that time, you weren't – I wasn't anyway – looking past HBO. I mean, obviously, there are possibilities there, but CNN wasn't even thought of at that point, because the next one that came along was TBS. Okay, now it gets us around the problem of the LA microwave channels, because we had run as far as you could go, along the border of New Mexico - actually they got to Farmington – was as far as you could literally take them because of the technology that you used at that time. So, how do you get East with those, and besides, who would want to buy them in the East anyway, if you stop to think about it. The difference of time zones, it got so you had to have some other source of entertainment, otherwise the industry would have remained an antenna service, which is what it was originally, and we were trying to grow it into an entertainment service, which is a whole different animal.

SOUTHWICK: How did Vero Beach get picked as the place to start?

JONES: That's interesting. I think the reason that Vero got picked was it was the easiest site to build an earth station in. It was close to Atlanta, which was where Scientific-Atlanta came from. The only unique problem with the construction of it was we had to, because of the soil, build huge blocks of concrete to protect them against hurricane force winds, but it was still the quickest one to build. We had a fairly decent subscriber base there; the system wasn't that great, frankly. I've got an interesting little tidbit to tell you about the night, but anyway, my recollection is that was the easiest one to do of the seven that we picked out, and to get it done the quickest. It was also the closest to New York, and people could come down to it. I mentioned the quality of the system: the system at that time had about a 35 amp cascade, and for people who may not be familiar with what that means, back in those days, the number of amplifiers you could put in a line, a cascade, they'd build up so much noise that you come to a point to where the picture's not usable. So you were limited by how far you could go. You still have got those limitations today, but today you can use fiber optics and convert to light and go 60 miles, where back then you couldn't go but 1,900 feet, so you have a big difference in the number of amplifiers you have to have. We were 35 amplifiers deep at the Holiday Inn where this service was put on from the headend of where we actually had it, which was in Ft. Pierce, and Bob and I were standing in front of the big screen monitor when the signal came on, and I looked at that and I said, "Oh my God, have we got a problem." And he looked at me and said, "What do you mean? What do you mean?" I said, "When our customers see how good that picture is going through all that cable and all of the quality that we've got now, compare that to the signals we're offering from Miami, we've got a problem." I mean, I'd already seen what was going to happen. You know, the quality was just outstanding, obviously, because it wasn't handled, just through our network, where the quality of the signals coming from Miami, coming through the short arm microwave, coming through... handled umpteen times, degraded it and it was obvious.

SOUTHWICK: In contrast, the signal coming from the Philippines was better?

JONES: Oh, it was just outstanding. Oh, yeah. It's funny how things like that work. That also opened the eyes of the industry as to what kind of quality you should be delivering. If people have nothing to compare it to, then it's good enough. If you can't get direct off-the-air, or you can't get some other comparison, and video wasn't really that popular back then, I mean videotapes. They were fairly pricey and most people didn't have... you didn't have the movie industry around, and all the other things that you didn't have. So, it sharpened our pencil about getting upgraded, getting better engineered systems.

SOUTHWICK: Now, in terms of turning on the signal and seeing that picture, that was just shortly before the event started, right?

JONES: It was, yeah.

SOUTHWICK: So you weren't flat out sure this was going to work until that point?

JONES: Oh, yeah, we went through two satellites. You actually went from Manila to LA, LA to New York, and back down again. So you handled it twice, and no, we all were sitting there, "Is this thing going to work?" And of course everybody said, "Sure, it's going to work." Yeah, well, okay, show me!

SOUTHWICK: Well, you'd had trials before, though, out at the Western Show, and... or the NCTA?

JONES: Oh, yes. As far as the technology we knew it would work, but it had never been done like that.

SOUTHWICK: And was it a race to kind of get the dish in place and things done before the deadline, or how did that work?

JONES: It was. The timing worked out, as it turned out, perfectly fine. Actually there were three satellites up and running and only two of them were licensed it turns out, and I discovered that through the history that we did at the Western Show last year on the participants that created the satellite industry. SA had their dish on, which wasn't licensed. The only two licensed were the ones at Jackson, Mississippi and Vero Beach, Florida. Actually, Vero Beach is wrong – the dish was actually in Ft. Pierce, but the event for all the luminaries was in Vero Beach.

SOUTHWICK: And how many people were there? What was it like? Was it a Holiday Inn?

JONES: It was. We had a big conference room, about 75 people. We had local dignitaries; you had, obviously, the people out of New York. Jerry Levin was there, we actually had Bob was there, Dave Strasler, who was the chairman of our company. I don't remember all the people that were there. I went through and looked at...

SOUTHWICK: Kay Koplovitz, I think.

JONES: Oh, she was there. Well, she put the entertainment function together afterwards. Well, and she also helped, I think, set the whole thing up as far as an event type planning, so yes, she was there.

SOUTHWICK: Irving Kahn?

JONES: I was trying to think of that name. I'm glad you mentioned him. Bob invited him because Irving had, I guess, had a visionary of what the industry ought to be. Yeah, he came.

SOUTHWICK: And were there speeches made?

JONES: I don't recall. That doesn't stick in my mind at all. I was more concerned about it working then anything else.

SOUTHWICK: What was the reaction among people?

JONES: Oohs and aahs. The fight was pretty good, too, so it turned out to be an all around good event. I don't think – certainly I didn't – I don't think a lot of the people there realized what you really were seeing, which was the birth of an industry. That was the seminal event, in my mind, changing it from just an antenna service to what it is today.

SOUTHWICK: And were you running the signal just to the Holiday Inn, or were subscribers actually seeing it in their homes, as well?

JONES: We ran it just to the Holiday Inn, I think. I'd have to go back and look at that. I hadn't thought about it. I'm sure we probably did – I'm not sure. I'd have to look that up and see. The thing that strikes you, that I remember the most about it of course, is getting the thing built, and then the event itself, and then after that it was just business as usual.

SOUTHWICK: Well, it wasn't though. What did you actually do the next week and the next few weeks after you knew it worked? Did you start marketing it in Vero Beach right away?

JONES: Yes, we did market. We had a decision to make at that time that... and the only way that anyone in the whole system could have seen it would have been if you pulled a channel off and put something on it.

SOUTHWICK: Because you were up to capacity?

JONES: That's correct. And what we went with is what was called a negative trap. So, we sold the HBO service and we went and trapped out everybody in town, and only removed the trap if you sold the service. So our first order of business was to trap everybody, pick the channel – the channel we used is channel 4, and the reason for that is because of the way the spectrum sets up. If you put a trip in, the distance between 4 and 5 audio, it won't interfere with it. So, we used channel 4, and ordered the traps, and that was another story that Ken ought to talk about sometime, is just getting the technology to work and the companies...

SOUTHWICK: The negative traps?

JONES: To make the traps, yeah. Originally they were out of coax cable, and then later on they made them in a little barrel with the trapping mechanism inside of it. Today, if you had today's technology, obviously what you'd have done is to do it the other way around. You would say, "Okay, here it is if you want it. Here's a box and it will let you have it." So it was a different philosophy, but the traps were only about $7.50 to install. So, if you had 3,000 customers, you start figuring the math out, as opposed to using a $100 box, although... I don't know what they cost – it was about 50 bucks probably, back then for a box. So, it made more sense capital wise for us to do it, plus we didn't have the electronic problem that you have, and you don't have to irritate the customer by putting a box in that takes...

SOUTHWICK: In their living room.

JONES: Right, so that was the decision we made, and we stayed with that decision everywhere we had HBO, and only when we added, started adding ShowTime, Cinemax, and other services like that did we go to electronics, because you run into a trap problem, you've got to start cascading...

SOUTHWICK: You have too many of those things out there.

JONES: It just doesn't work out.

SOUTHWICK: And what was the reaction among people when you began to market HBO?

JONES: It was – you had some early adopters, but it was not a slam dunk.

SOUTHWICK: Really?

JONES: People, number one, they didn't quite know what they were getting, number one. Number two, we had a very unsophisticated, if you will, and I'm using this for the industry itself, and certainly for our company, marketing. I mean, I'm not a marketer, but yet it fell on me to innovate type of thing. So we had a pretty steep learning curve on how to get to the customer. Television stations would not accept advertising; we had a tough time with radio. So, you wound up using newspapers, that was a predominant vehicle that you used, and the thrust was uncut, untouched movies, uninterrupted. I mean, that was the theme. Well, the quality of some of the movies kind of got us in trouble. We had one – I've forgotten the name of it – but I remember that the reaction it got when it was shown in Jonesboro, Arkansas... James Brown was in it and it was all kinds of different pretty ugly scenes about the Civil War era and slavery and so forth. I mean, we got reactions from the cities and the people all over the place. So, it was a learning curve with franchising authorities and realizing that this was coming in your home, ready or not, if you subscribe to the service that's what it is. It's not like going to a movie. But once people finally understood what it was they were able to buy and the privilege, not privilege, but the ability to watch it uninterrupted in your home and so forth was a pretty good drive, and then later on, we had a shortage of product and we were recycling. Also we were doing what we'd call... we'd stagger the hours so that you could fill the day up, number one, and number two to allow the customer to view it when they want. Then they start saying, "Well, you're just showing the same thing over and over again," so they started churning off, but...

SOUTHWICK: What'd you charge for it when you first...?

JONES: $7.50.

SOUTHWICK: And how did that number come about?

JONES: I have no idea. I think it's because they charged us $3.50 and we doubled that and you realize that your operating expense of the overall... if you work the math out what you wind up making is about 20% because you've still got the truck rolls, you've still got the same infrastructure to support it and so forth. But it saved the industry.

SOUTHWICK: And the next one to go up on the satellite was W... I think it was still called TCG in those days.

JONES: I think it was, yeah.

SOUTHWICK: For "watch this channel grow", and then changed to WTBS. When did you first become aware of Ted Turner?

JONES: Well, the first real realization of Ted as an individual and as a visionary and where he was going, was when he was talking to everyone in the industry about launching CNN. The actual independent was nice, and I don't remember now what we paid for it; it wasn't all that much, 5 cents a sub or something like that. You know, it was another product, something else to add to it, but the headline news type – although it wasn't called headline news then, it was just CNN 24-hour news all the time – was intriguing, but my reaction as a field person was "Gee, I don't know. Does someone really want to watch that? I mean, what are you really getting here?" The concept was pretty foreign. I actually met him in person in Dallas in 1980, I think, was the first time I ever spent anytime with him at all and talked to him about it. He is quite a showman.

SOUTHWICK: How did he sell you on it?

JONES: Well, he sold Bob more than he did me. Bob had a better idea and a better grasp about what would sell or what would go in the industry and systems than I did. I just...

SOUTHWICK: Trying to make them work? What about the creation of USA? Were you involved in that?

JONES: No, only as part of the company. That was Bob's – he and Kay.

SOUTHWICK: And now I think it's probably appropriate to talk about what happened to Columbia and particularly what happened to Bob Rosencrans.

JONES: Yeah, it's an interesting story. It changed my life a lot, and of course it did his as well, but as I had mentioned earlier, the original founders and shareholders of the original private company that obviously when it went public they had large amounts of shares to control the company, decided for state reasons and people getting older and various other reasons, plus the prices of systems were rising at the time, that it would be a good opportunity for them to monetize the investment, if you will, and the United Artists people did not want to do that because of the capital gains problems they would have if they were taken out, but they did not have the votes to prevent it from happening. So they went looking for someone to help them acquire the company, and as I mentioned earlier, Ted Rogers, who had a presence in the U.S. at that time, was interested and wanted to become a big player in the United States. They formed a partnership to actually buy the company and take it public, or excuse me, take it private, which they did. I forget what year that was, but it was '85, '84, somewhere back in there, roughly. The management styles and the differences in philosophy – from Ted Rogers, and he's another unique individual that has built a quite large cable, I'd call it almost an empire, in Canada, because the size of it is in Canada, and as well as television and closed circuit and so forth – and the ultra-conservative daily cash run business of a theater group, and then you add in a third component of people like Bob and myself, who are used to running our own systems and shows and knowing what needed to be done and finding ways to do it and so forth – formed quite a clash and Bob was very attuned to having the employees and the management of the company have a vested interest, and was pushing pretty hard for – well, I'm getting ahead of myself. The split between Ted Rogers and Rogers' group, and Sol [???] and the Naify's took place before the event with Bob took place. That philosophy, the difference in operating philosophies between those two companies put us management in the middle.

SOUTHWICK: Between Rogers and UA?

JONES: That's correct. They had a real problem dealing with it, and they pulled the plug and there was a split up agreement, and the way the split up worked was, whoever called for the split created two piles of systems equally and the other party got to pick which one they wanted, including the people, and or course UA is the one that pulled the trigger, so myself and Bob and others created the two distinct groups. And we really thought that what they would do is take the Eastern group because we were predominantly in New Jersey in the East, and then in the West... if you drew a line right down the middle of the country you'd have an East/West orientation.

SOUTHWICK: How big was the company in terms of subscribers in those days, roughly?

JONES: A million and a half, I think, because I think after the split it was about 750,000 something like that. We were about a million and a half subs at the time. So anyway, we created this split the best we could and they confounded us by picking the West, which was where Ken was at, where I was. We were in San Angelo, that was our operating headquarters at the time. We'd built San Antonio – that was under construction and just finished, and we had all the other Western systems. So they wound up, where we thought they'd take New Jersey and so forth, because it was closer to them, it created quite an interesting deal because then you had to resign from the company that picked you because obviously I wasn't about to go work for Ted Rogers, I wanted to work with Bob Rosencrans and Bob's up in the East, so it was some interesting times. But when it all finally sorted itself out, we had a wholly owned subsidiary of United Artists theaters that Bob was reporting to the board, the Naify's, and he used to go to San Francisco all the time, and he and Kenneth were trying to create a structure within the theater group that was somewhat akin to what we were used to running, and they were trying to get stock in the company and things like that. The Naify's were the type of individuals that didn't give anything to anybody. That was not in their makeup, and Bob, and later, Ken, had pushed so hard that finally Bob Naify fired Bob and actually it was handled, I consider, very poorly, and I think everyone else would too, is they called him on the telephone on Father's Day and fired him over the phone, which I find... I still find that offensive. If you don't have enough... anyway, that's for them to decide. So, it was quite a shock for all of us.

SOUTHWICK: So Bob Rosencrans left the company, where did that leave you?

JONES: Actually what happened after they terminated Bob was Sal Ahasnan, who was Exec VP for United Artists asked if I would take the job, and my first instinct was to say no, and I talked to Bob about it. I was torn, I really was. I had no desire, had never pictured myself as ever being president of the company and did not want to be. I was perfectly happy with what I was doing. The more I thought about it, the more I thought "Well, what happens to everybody else?" I've got a whole regional and divisional structure underneath me, and if I'm gone, well, then who do they bring in? And so, I made the decision with a great deal of angst to take the job, and I remember Bob and I talking at his house – we had a sort of a final get together before everybody left talk – and he encourage me to take it, although he said, "If I had anything for you," because Columbia International didn't exist at that point, it would have been a different story. And so I took the job and it has been an interesting learning experience. I was not prepared for it, hadn't focused on being that. Dealing with Sal Ahasnan was an interesting experience of its own, and he is very much a hands on type individual. That was part of the problem with Bob is Bob wanted to remain and operate as he's always operated and Sal was saying, "Look, you're working for us. It's our company." So you run into that over and over again. I have in a variety of different mergers. The buyer says, "Look, I own it." So you have to make a decision.

SOUTHWICK: Was part of the problem, also, that they weren't really cable people?

JONES: That's correct. We had a great deal of difficulty. The first board meeting that I went to to make budget presentations to them was bizarre to say the least compared to what it should have been. I'm sitting there in a chair, not unlike what I'm in now, balancing papers on my lap, trying to explain to them why you have to buy converters, and what they do. They had no concept of how a system even technically worked, and they'd never had any occasion to before. I mean, they just... Bob would give them the numbers that he'd forecasted and so forth, and Ken would say a few things, and they'd go off and that'd be that, and the numbers always came through and so on, but when they owned it fully, they wanted to treat it like you do a movie theater. In the movie theater business they know every coke that you've sold, every bag of popcorn, and they know it daily, and they expected the cable system to work that way. Well, this business does not work that way, and you have to make long-term investments, long-term decisions that you may not see the results of for months, maybe years, who knows? It's not like a movie that either dies or falls in the first weekend, so it was quite an experience.

SOUTHWICK: And what year was this?

JONES: It was 1985, I believe. Yeah, that's about right – '84, late '84. They wanted to move the headquarters. I was in San Angelo, Texas, had been there since 1974, so I moved to Montvale, New Jersey so I could be closer to the management of United Artists, and interestingly enough, Sal Ahasnan, who I reported directly to, was not kept apprised of what the Naify's were doing, because they wound up selling their interest in the cable system to Malone and that was – remember the Moscow trip, the first time?

SOUTHWICK: Um-hmm, the Goodwill Games.

JONES: Yes, that's exactly when it happened.

SOUTHWICK: Right. Um-hmm.

JONES: And when they came back the announcement was made, "Guess what? We did the deal." And Sol was taken aback, and I was taken aback, and it turned out that it was a good move. That's when Stewart Blair got involved and some others because the original concept from Malone's and J.C. Sparkman's position was to absorb the systems into TCI operationally and sell off the theaters. Well, Stewart Blair and Brendan Kluston saw an opportunity here, because here you've got a company and you've got a cash flow business and two different businesses to run there, you've got to do something with them. Why not let them remain independent and run them as an entity on its own, and they were able to persuade Malone to do that. Stewart was named the CEO of it, and Brendan...

SOUTHWICK: To allow the whole company, including the cable systems and the theaters, to remain essentially independent as a subsidiary of TCI.

JONES: Correct, operate separately. Right. So, Stewart became the CEO, which he enjoyed thoroughly. The first meeting that I had with him was interesting. We met in a lawyer's office in New York City; Sol had met with him first about the theaters, and Sol was a quite large man. He's an Egyptian that came over and educated himself and started as a theater usher and worked his way up – he's quite a self-made man. And Stewart Blair is a unique individual, and is English, actually Scottish, and long blonde hair, stringy – just totally two opposite people. And then I walk in to the meeting room and the first thing Stewart says to me, "One of us is going to have to change their hairstyle." And I thought to myself – I didn't say it out loud, I should have, I didn't know him well enough then – well, it isn't going to be me. I didn't, either. It was an interesting association, and it enabled me to keep running the systems and I was the chief operating officer until Malone finally decided that Stewart was maybe getting a little too ambitious and he decided to pull the option he had to buy the rest of the shares from the Naifys and they did absorb them then.

SOUTHWICK: And how did it change the operations of the systems under the Stewart Blair kind of quasi-independent stage?

JONES: From my perspective, two things happened. The way that you went at the capital budgeting and operational budget changed quite a bit because the TCI method was somewhat different then ours. There were limits put on our capital spending for what I considered no good reason. I mean, the reason was that they wanted to use the funds somewhere else rather than the business needs for it.

SOUTHWICK: So they were squeezing you a little bit in order to put some resources in...?

JONES: That's correct – to buy corporate airplanes, and things that we had done very well without. So, the positive side was that they used our operating group as a – Malone did this – as a balance staff, or a... what is the term I'm looking for... a benchmark for TCI systems, and I asked how come you can't run the operating margins that UA's running at? So that created some tension.

SOUTHWICK: What were the margins?

JONES: We were running around 50%, and that was kind of the benchmark that you used. As you get into bigger and bigger systems it's not possible, but back then in a classic systems, 50% was the number, and they were running...

SOUTHWICK: And this is about the time that rates were deregulated as well. Did that make a big difference for you?

JONES: Yes, later on, and right about that time...

SOUTHWICK: '86, I think.

JONES: '86 I guess it was.

SOUTHWICK: Yeah, because it was two years after the '84 Act passed, I think.

JONES: At that point, there was probably more pressure to raise rates than there might have been under the complete stand alone system because funds were being used for a variety of things. The theater business wasn't doing all that well, either. Malone saw, from the first day he ever saw that, that that was not a business he wanted to be in. Stewart fell in love with it.

SOUTHWICK: And eventually ended up with it, too?

JONES: Yes, right.

SOUTHWICK: Merrill Lynch, I think.

JONES: To not necessarily a good result, but anyway he did.

SOUTHWICK: And so when it merged into TCI, where did you end up in the hierarchy?

JONES: When they merged, totally took it over in '91, they eliminated my position and all of the corporate staff. There were about 125 of us here that were let go, and I started a consulting company called Marvin Jones Associates, Inc. – really original – and my first client, which turned out to be one of the best ones I had, was John Malone, who called me up. I was sitting around wondering what I was going to do, because I was just out of a job. I'd never been out of a job in my life, and didn't quite know what to do. I mean, how do you go about plugging back in again? Probably feeling sorry for myself, too, truth be known, and he called and wanted to know if I was interested in working with Liberty Media and Peter Barton, because that spin-off, when it took place, had all the partnerships that TCI had in various operating entities that they owned various percentages in but had separate management, and Bresnan was one of them, Leo Hindery's company was another, the Knight Ridder group, the old Storer systems, and all of those.

SOUTHWICK: And TCI owned anywhere from 1% to 90% of all these different...?

JONES: Actually, I think the lowest... you had to have 15% in order to get the discounts from the pay services, and so I think it was from 15% to around 50% and the Gerry Lenfest group, there were some pretty big properties there, and they had around 3 million subs. So, I became their paid consultant and officed out of their building. I had other clients but not anything of the magnitude of them. I did some work internationally for TCI International, for Comcast, but mostly I'd babysit the partnerships that they had, and while Peter and Dobb and those were out building the programming side and other entities there, I was looking after the systems, so that worked pretty well.

SOUTHWICK: But you weren't actually operating them, right? I mean, the individual, whether it was Lenfest or Bresnan...

JONES: No, it was strictly a board seat type... we had veto power over the budgets. We could not tell them what they should be, but if we didn't like the direction they were going, mainly in capital spending or something like that, we had the ability to have a negative vote, which we never used.

SOUTHWICK: But all of these had been owned partly by TCI prior, so it wasn't as if you were coming in completely new?

JONES: No, I was new to them, but it wasn't a change for them at all. The person that they used to deal with was Larry Carlton, I believe, and so I just substituted for them.

SOUTHWICK: And what was Malone like to work for, or with?

JONES: I found him very stimulating. I miss that a lot. I mean, he's the type of individual that in a group executive meeting, you would never know where it was going to go. Obviously you had a topic that you were meeting about, but his mind is such that he can make connections that you don't even think about, and I found it very stimulating. It was interesting – you had to be around him for a while to understand some of the ways he did things. He would float an idea, and being who he is and where he is, depending on who you were, you'd either take that as an order or you would take it as, oh, it's just another idea and ignore it, or somewhere in between. And really all three of those were correct because he would test different things. "Why don't you take MTV off?" And you'd think, well, I'll tell you why I'm not taking it off: because I'd get my head handed to me. I mean, that would be my response. Other people would take it off and get their head handed to them, and then go through the exercise to put it back on. He would do things like that, and that was a simple example. Much more complex examples exist.

SOUTHWICK: Was he looking for you to argue back?

JONES: Yes. He was testing a thought. Why are we paying MTV – and personally I don't like it, I mean that's his mind working – this exorbitant fee when we could be using that money to do something else. So, tell me why we shouldn't do this? And then, if you're not careful, you would...

SOUTHWICK: You'd salute and go jump off the bridge.

JONES: Yeah, you'd go jump off the bridge, yeah.

SOUTHWICK: Interesting.

JONES: But I thoroughly enjoyed him. When I was serving on the NCTA board, I was able as an independent stay on it, it was interesting to see the reaction of other operators and himself and how he handled himself and so forth. Very bright.

SOUTHWICK: What was his position in the industry, and kind of relationship to some of these other moguls, particularly Time, Inc.?

JONES: Well, there were some tensions.

SOUTHWICK: Did they resent him?

JONES: There were some tensions between them because he's not afraid to speak his mind. He's not political at all, in the sense that some people are pretty good at taking the long way around to say something, he takes the shortcut. That doesn't always fit well with people, and he'd call a fool a fool, from his viewpoint, so there was some interesting times. But everyone respected him and respected his intellect. I've never heard anyone say he didn't have the brainpower. They didn't agree with the way he ran the company in the sense that their philosophy – take, say, an Amos Hostetter versus John Malone – totally different approaches. As I mentioned earlier, TCI was on a land grant grab type philosophy to get as big as you possibly can because he knew someday, somewhere, someone was going to buy all this, and he wanted to have the market cornered, if you will. Where Amos and Bob Rosencrans and others, were going at it from a this is a business I want to grow, this is how I want it to look, and this is how I want it to be run, and if I can't run it that way if I get bigger, than I won't get bigger. So it's a total different way of approaching it. I'm not going to say which one is right or wrong; I don't think there is a right or wrong. I mean, they both turned out one way or another.

SOUTHWICK: Now they're both shareholders in AT&T.

JONES: Interesting, huh?

SOUTHWICK: Sitting on the boards of all these different companies, which ones struck you as perhaps, I don't know if best run is really the right way to ask it, but which ones were kind of doing interesting things, and which ones struck you as, gee whiz, I never thought of that? You had Lenfest and Bresnan and what all others?

JONES: I guess the differences between the companies were most marked in the Knight Ridder companies versus Gerry Lenfest or Bill Bresnan.

SOUTHWICK: Meaning somebody who sort of was a creature of the industry, Lenfest and Bresnan, versus a company that's really in the newspaper business?

JONES: That's correct, and the way they viewed and the questions they would ask and the way you go at it, and then you had someone like Leo Hindery, who had his properties there, who was not an operator, but a dealmaker extraordinaire, and he was trying to build something, not too dissimilar to what Malone had done, and not without good reason because he sort of went to school on Malone, and Bob Lewis was a cohort of theirs that they were building all of these various partnerships. Leo, to his good credit, was very sensitive to the relationships with communities and with customers and so forth, where Malone and TCI could take the position that it's our business and if we get along, fine, if we don't, well, that's fine too. It's a different approach. The Knight Ridder people were always – and I'd probably have done the same – comparing what the cable systems were doing and its cash flow and its growth against what the newspapers were doing in advertising, and so I found that very interesting, enough so that I wouldn't want to be in the newspaper business. That's not my cup of tea, and some of the management agreed with me, too, that was interesting. They all in their own way were quite good properties. They allowed their management in the field to run the business without a great deal of interference and so forth, which I find the best way to do it.

SOUTHWICK: What was the purpose of Liberty? What was its real ultimate goal?

JONES: You know, without being John Malone I can't answer that truthfully. I can tell you what I think it was, and probably to the benefit of where it went. He always felt like no one was really valuing TCI the way it should based on all the investments that it had in programming and in cable systems and others, and there was no way to get that out of it, except by creating an entity that could be examined and looked at. The structure that he put together to make that happen is unbelievable. I think they make case studies out of just studying how he did that. Very, very few people understood it, but they all understood what it did for the stock when it was issued, and I think you'll see, maybe not as great a bang, but you'll see it happen again. I mean, I still believe that Liberty is the right vehicle and the right group, that they're there for what they're trying to do. But it was strictly a way to get value out and get it recognized and trade it.

SOUTHWICK: It also transformed him from an employee of the company essentially, albeit well-paid, to a significant owner of the company.

JONES: That's correct. If that was the original plan, it's worked very well. I don't know what the original plan was.

SOUTHWICK: Liberty, then, was folded back into TCI.

JONES: It was.

SOUTHWICK: And what was your role at that point?

JONES: When Liberty came back in, I actually kind of came back in with it and still remained as a consultant to TCI, still Liberty. I stayed on those boards of all of those partnerships up until they were sold, and some of them I got off when I went to work full-time as an employee of TCI in '96. Obviously I was no longer on their boards then, although they still looked to me to look after them, but I was still a consultant to them.

SOUTHWICK: TCI hit some pretty difficult times there, in the mid '90s, partly, I think, because, well, they had the Bell Atlantic deal, which fell through, they had rate regulation, which took effect, they took a lot of heat for bad customer service and so forth. What happened to the company in the mid '90s?

JONES: Part of the problem that occurred at about that time was they knew that they needed to build a network capable of broadband technology. Telephony, in their minds, was going to be a threat from the telephone companies, and it also was a source of revenue for the cable companies. They felt at that time that if we didn't get into it then the telephone companies were going to gobble us up. So, they've tried to put together a structure, a network, and a management that would allow them to build this network, but remove from it, because of their lack of in-depth management that they felt could do the new generation of business, the people that were managing the systems in the field they didn't feel comfortable could offer telephony or any of those services that come along, the decision was made to create a network that removed the network, the cable system, from the management into one large, almost like a telephone call center concept, so that you could say that the same standards are met everywhere, the phones answered the same way everywhere. That's what created the call centers that were built, and the decision to try to make a billing system to handle all this, called Summit Track, which absorbed tremendous amounts of development funds and so forth.

SOUTHWICK: So instead of having a kind of dispersed authority and a lot of different guys it was all central.

JONES: It was all central, completely centralized. So the local manager really had no say so over what channel carriages they had, what hours that they had, what rates they charged. They were really, I don't know what a good description would be, they're just caretakers. They weren't business operators, which is a totally different way of looking at it. This industry has always been built on small entrepreneurial businesses. Each system, each city was a business on its own. To take that concept and scatter it across the United States the way it was, and try to make one system out of it was a tremendous undertaking, and financially it almost killed it. Between the sums that were spent and being spent and not really necessarily being...

SOUTHWICK: Recouped.

JONES: Yeah, and efficiently done. Rebuilds were started without maybe the necessary oversights, and there was a lot of overspending on capital, no one knew what was done, there were systems being built by contractors, in Chicago, for instance, they're supposed to be building a 500 megahertz system and you go find out it wasn't. There was no oversight.

SOUTHWICK: Did a lot of the long time TCI managers leave during that period?

JONES: A lot of them did leave. The good ones, or independent thinkers, did because they couldn't survive in that environment, and the ones that were left would keep their head down to keep from getting it shot off, so it got to be really an uncomfortable scenario. When I came back to work for them – or came to work for them – the first time I worked directly for TCI was in '96, they had just stopped everything. They put a freeze on it.

SOUTHWICK: And this is when Leo Hindery came in?

JONES: Yeah, I came in '96, in October. John asked me to manage and be president of what they called Group B. We had A, B, C. The Group B was the medium sized systems – as opposed to Denver, Hartford, I would have the San Angelos and Tulsas and those kinds of systems because he felt, properly so, that the margins were just off the wall. We were only getting about 30% margins in the classic systems, and he asked if I would run those for him, which I did, and at one point the original thinking was to spin those off and make a stand alone entity of them, make a separate company of them. And then put the Group A, which were the ones that they were spending all the money on, the Hartfords and others, in the large markets, then you had the ones that were doing interactive, Group C and so forth. He quickly found he couldn't do that because of tax reasons and because of ownership, the way the company had been built, there was no way to spin them out, so he reached the decision that he just needed a change in management, and he asked Leo to come and run it. Leo came in February of '97, I believe it was, and Leo asked me when he was being interviewed for that job if I would take on all the systems, and I said yes.

SOUTHWICK: What'd you do?

JONES: Do in...?

SOUTHWICK: In terms of what changes did you make when you came in?

JONES: Well, I changed it back to a structure that they had had in their past that I'd always used in Columbia and United Artists, which was strong regional divisional management, and with clear authority and budgetary ability. Once we all agreed on what the budget was, they ran them, and as long as the numbers are there and the benchmarks are checked, I'm out of your hair. You miss them you got a phone call, miss them twice you got a visit, I mean, that kind of concept. We had to change some managers because they weren't able to handle that. Others just blossomed, and so we created five divisions and were well on our way, at the time they made the decision to sell to AT&T, to putting that company right back where it should have been some time ago. We had about another year left to get everything accomplished we wanted to accomplish, but got enough done to where AT&T thought it would fit their long-term needs and so forth. Then when AT&T made their decision, and Malone and Leo to sell the company and Armstrong to buy it, it brought me to the end of what I think my cable career as an operating person will be.

SOUTHWICK: You never know.

JONES: Well, that's pretty true, but I'm just not cut out for the operating environment that a telephone company operates in. So now I'm retired.

SOUTHWICK: Let me ask you about a couple of things we didn't get into. One is C-SPAN. That was really the creation of Ken Gunter and Bob Rosencrans. How did that come about?

JONES: And Brian Lamb. Brian Lamb was pitching all the NCTA board on this concept, and he found a kindred soul with both Rosencrans and Gunter. As a matter of fact, Ken was an agitator about Bob to make the investment, and Bob wrote a check, I think it was $25,000, I believe was the number.

SOUTHWICK: Yep.

JONES: And of course that was kind of the seed money that got the whole thing up and running.

SOUTHWICK: What was it about Ken and Bob that made them fertile ground for when Brian Lamb, this trade reporter, walked in with a harebrained idea?

JONES: They're very much fully-rounded individuals as far as government goes, society goes, and so forth. They have sides to them that you don't necessarily see in a lot of the business world, and they really believed in what the concept was. That number one, this is a great idea; number two, it's something that ought to happen; and number three, to a lesser degree, people will watch it. It's unique. I mean, where else can you get this? You've got to get cable service to do it. That was always something we looked for throughout my career, is what makes this different from some other source and how can you make your potential customers enjoy it and want to keep it because you can't get it anywhere else. The concept of being able to see, with all the warts, Congress going through the laborious exercise of creating laws that effect our society is in some ways like watching paint dry, and in some other ways like watching sausage being made, but it certainly is not boring. It's very stimulating to understand we can do this. I mean, no one can sit and watch it all the time, but it's just the fact it's there. Where else in the world can you see this? So I've been a supporter, obviously, from day one. When Bob left, well I became, I was on the board of C-SPAN up until I left the company. Well, actually, I was on the executive committee until Leo came and he took my place, but I've always been a major supporter. Brian is just another one of these individuals that are unique to this industry, and in a lot of ways to the world, and he's had a passion and a vision for this that, unless you've been around him, and I know you have, you can't understand how someone like him could even be around. He's the most non-biased, as far as letting anyone else know about it. He's biased, we all are, but he's able to pick the middle road and get, no matter who it is, on those programs, and with them feeling that he's not going to have a slant to it one way or another. Anything that comes across is what you come across, not something he did. So, it's a unique service, it really is. Brian Lamb is another one of these unique individuals in the industry that you can line them up – people like Bill Daniels and Bill Bresnan and Amos Hostetter and John Malone – they all have some persona, some image that comes to mind, and of course Brian's is a single-minded dedication to that channel and its unbiased objectivity, and he is just frantic about anything ever interfering with that. He becomes a whole different individual; he can be very passionate about being perceived something interfering with that channel. It really is his child, I guess.

SOUTHWICK: You got into this business because you liked riding around in a car outside rather than being in working in a smelter. At some point, I guess, you must have realized that you were in more than just the shoe business, that what you were doing was kind of transforming society. Do you think about that now, and do you think about what it is this industry has accomplished?

JONES: I do, but it's only been lately, I think, once you sort of... I guess when it really became more apparent to me and I started really giving some thought to it, I served as – we didn't mention, but as you know – for a period of time as the interim CEO of The Cable Center, and part of that activity, which of course this taping is part of it as well, is reviewing and preserving all of the events and things that took place that created the industry that we now look at. I mean, it's still ongoing and evolving as we sit here, and so you start thinking about, well, here we are. How did we get where we are and what were the things that went on? When we put together the panel for the Western Show a year ago, with Levin, Rosencrans, Rifkin, and Brian as a moderator, and talking about what led up to the decisions that the decision makers were making to create this satellite technology and what it meant to this industry, and ultimately to the world, you've got to kind of take a thought and say, you know, gee, we really did do something. You didn't just make money for your shareholders, you created a business that allowed something like CNN to come into being, and as a direct result the Berlin Wall came down. It would still be there! So if you don't think about that then you're probably not thinking too deeply. But it is interesting what's happened, and it's nice to be a part of it. My part was on a smaller stage, I would say, than some of the other players like Malone and others, but I represent, I think, the people that made it work. Somebody has to take the visionary's ideas and actually apply them to the real world, and that's what I was fairly good at and I enjoyed doing.

SOUTHWICK: Talk a little bit about The Cable Center, if you will, what its purpose is, how it's evolved a bit over the last year or so since you've been involved.

JONES: The original history of a cable museum started several years back and was originally in Pennsylvania, and it was a way to preserve materials and documents and things that were in danger of being lost. There was a sense later on that it needed to be enlarged and a great deal of that occurred when the decision was made to come from Pennsylvania to Denver, and they decided to build an actual museum and also form an affiliation with Denver University, which really, that relationship and partnership, if you will, is what is going to allow The Center to become a real entity, not just a museum, which that's not its purpose. You need to know where you came from, you need to know what G Line meant for the industry and how it got to broadband and how it got to fiber optics, but where is it going and what does it mean to society and how can you use that as a teaching mechanism and so forth, which is what we created with the Magness Institute. So it ultimately will wind up being a place that scholars can use, news gatherers can use as a history source. The university partnership allows you to set up teaching and schooling to teach the next generation of people that are maybe in the broadband and entertainment business, if nothing else, teach them what not to do, help them understand what customer service really means, and why it's important, and all those things. So it's been exciting for me. I served, I don't know, I guess almost 18 months as a sort of pro bono president. I was executive on loan from AT&T until my term there expired. I found it very enlightening, very stimulating. I'd never been involved with a non-profit organization before, certainly not with a university. But of course, Dan Ritchie I've known from way back, Group W days, so as an individual I knew him, but I didn't know the mechanics of how a university works and they're a world of their own as well as non-profit organizations. So it's another piece of my education, if you will. I'm looking forward to the opening. It's going to be quite spectacular.

SOUTHWICK: Terrific. Anything else I left out?

JONES: Oh, we could probably talk about all kinds of minor stuff, but I think we've covered most of the high spots.

SOUTHWICK: Terrific. Well, thank you very much.

JONES: Thank you.

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  BACK TO ORAL HISTORIES

Glenn Jones

jonesGlenn5

Interview Date: Thursday September 09, 1999
Interview Location: Denver, CO; Washington, DC
Interviewer: Marlowe Froke
Program: Hauser Project

First part of interview was conducted in Denver, CO, September 9, 1999. The second part was conducted in Washington, DC, December 12, 2001

FROKE: This is the Oral and Video history of Glenn R. Jones, the president and chief executive officer of Jones Intercable Incorporated and later Jones knowledge.com. The history is made possible by a gift from the Hauser Foundation's Oral and Video History Project of the National Cable Television Center and Museum. The date is September 9, 1999 and we are recording in the production studio of the corporate headquarters of Jones here at 9697 E. Mineral Ave., Denver, Colorado.

My name is Marlowe Froke. I'm president emeritus of The Cable Center and a member of its Board of Directors and one of the interviewers for the Oral and Video History project.

Mr. Jones was one of those people in the United States who after WWII began to move into a new type of telecommunications called cable communications. He was an entrepreneur, one of the few who worked against government regulations, the competition and opposition of other media and all of many other factors that made it very, very difficult to get the business started. But indeed it got started, spread nationwide, spread across the world and Mr. Jones' enterprise activity by the turn of the century had ended up with a value of property of well over $1,000,000. In addition to his business acumen, Mr. Jones, like several other of the cable operators, had a deep sense of social good, a social conscience that prompted him to move in the direction of using the technology for social good as well as primarily education, especially adult education and higher education. He went on when he had completed his entrepreneurial activities and private enterprise to found the educational initiatives that began first with Mind Extension University and then graduated to become Jones knowledge.com. It is, then, one of the major educational initiatives by the cable industry and the use of technology for higher education in the United States and the world.

Glenn, I can imagine that your profit margin for Jones knowledge.com is considerably less than for Jones Intercable Inc.

JONES: Well, that's true – for now. But it was scale. I mean it could be even a larger enterprise.

FROKE: And here you're speaking of the world-wide applications.

JONES: Yes.

FROKE: As we move ahead with this visit we'll get into more detail about the scope and the breadth of your educational activities which are obviously terribly impressive and without a doubt you have the lead in what's now called distance education or distance learning as you so well know. What I'd like to do is go back in your growing up in Pennsylvania in the western part of the state, what was it in your family life that gave you this social conscience, this sense of public good that has driven your career? You've been highly successful financially, but beyond that there's something very, very special about you and what you've been doing in cable.

JONES: I don't really know. I don't know that I have an answer for that question. My parents weren't particularly that way. They weren't not that way, but, you know ...

FROKE: Your father was a coal miner, is that right?

JONES: Well, he'd started out as a coal miner and then my oldest brother got killed in a car accident in front of our house in this little town called Jackson Center, Pennsylvania.

FROKE: Oh my.

JONES: And so we packed up and moved to a dead-end street in what was then called Hickory, Pennsylvania, just right outside of Sharon, Pennsylvania, now called Hermitage. And so I grew up in principally on a dead-end street with a big oak tree at the end of it and several cars wrapped themselves around that oak tree at night because there was a hill and I could hear them at night getting started and cranking up thinking that it was a through street and just .... That oak tree was immovable.

FROKE: Was the move to the dead end street motivated on the part of your parents by the death of your brother?

JONES: Yes it was, yes, the death of Danny.

FROKE: How old was he when he was killed?

JONES: Oh, I was really ... couldn't have been more than 3, 4, something like that.

FROKE: He was older than you?

JONES: Yes, he was. Maybe he was a little older.... It was too long ago for me to remember.

FROKE: So you don't have a deep recollection of the circumstances other than an awareness of it.

JONES: No.

FROKE: What was your father's name?

JONES: Elvin. Elvin Robert.

FROKE: And your mother's name?

JONES: She was entirely Welsh as well. Her name was Genevieve Jenkins, Viola Genevieve Jenkins.

FROKE: Was she first generation immigrant?

JONES: She was second, my father was first, first meaning that his grandfather came over. On my mother's side, her father's father came over.

FROKE: Your father must have had a deep appreciation of education because it would appear in your background that he was insistent that once you finish your formal schooling that you go on to college.

JONES: Well, nobody went to college in my family at that time.

FROKE: So you were the first college ...

JONES: ... Yes. Nobody had gone. Yes. My mother graduated from high school and I still have her diploma up in my den. It was in my bedroom when three of us slept in the same bed but it was at the end of the bed was that diploma. My father just went to 8th grade basically. He did, in retrospect, have some sense of it because the only books that were beside our bed was a sort of orange crate bookcase affair with the Harvard Classics in it.

FROKE: My lord.

JONES: And so I was sick. I had scarlet fever 3 times although you're supposed to have it only once. It was probably misdiagnosed 2 times. But I spent a lot of time at home with the quarantine sign out front. So the only thing I had around to read were the Harvard Classics. I read Pascal's "Thoughts" and Dante's "Inferno" and things like that.

FROKE: Were the Harvard Classics acquired by him as gifts or someone had given him then?

JONES: You know, I don't really know. I suspect that they were blue and he probably acquired them second-hand from someplace. Anyway, there they were.

FROKE: So by proximity he thought maybe they would brush off on you, which they obviously did.

JONES: I have no idea what he thought. He was an advocate of Reader's Digest. He thought, and told me many times, that if a person read the Reader's Digest avidly for 4 years, it was the equivalent of a college education. He considered it such. He had a Ph.D. many times over during his life.

FROKE: I thought those aphorisms were only in South Dakota which was my state but apparently they penetrated Pennsylvania.

JONES: Yes, right.

FROKE: How did you get to Findley, Ohio then?

JONES: Well, it was funny. I was a Boy Scout. I was an Eagle Scout, and I ended up teaching archery and swimming at scout camp. I started out as a bugler because I was 14, something like that, and I tried to get a summer job at the scout camp. They said, "Well, first place you're too young to be a counselor and second place, everything is filled except a bugler." They asked if I could play a bugle and I said, "Yes." They were astounded at that, and so I got the job as camp bugler, Camp Andashawa. But then I had to go down and buy a bugle at the second-hand store and learn how to play it. But by the time camp started, I could blow all the bugle calls.

FROKE: So Findley was not a college?

JONES: Well, so what happened anyway...

FROKE: Okay.

JONES: ...in my junior year of high school I won this competition in the Boy Scouts to be sent to France as an emissary for the World Jamboree and came back and that kind of change life. I went around speaking about all this because in those days ... and going to Europe is – everybody does it now – but you know back then it was a different kind of thing. At any rate, because of scout camp and that and other things, a group of local businessmen formed a committee to send me to Yale. It was a full scholarship kind of thing.

FROKE: This in Hickory?

JONES: Yes, in Hickory - and Sharon. These businessmen were basically from Sharon. So they got me in. But the condition was that I had to go to a prep school for a half a year to pick up math, grammar that I missed because I was not the ideal student up until my senior year of high school. I missed mostly because of deportment problems and things like that. I missed a lot of things. But I didn't know what a prep school was. I just wasn't in to it. I said I wouldn't do that, which was the stupidest move of my life, one of many. So I got a job in Sharon Steel, in the coal roll department and it was in a swing shift. It was great down there with Italian, Polish and Romanian immigrants. It was just a melting pot. It was very interesting and I was making money. So one day that September - I worked during the summer - I came home and went to sleep and woke up and my father was hitting my feet with his hand. He pointed to this cardboard suitcase - it looked like it was leather but it was really cardboard - which was all packed and said, "Son, today we're going to college." I had no idea. He had worked this deal through the, we belonged to the Church of God which is sort of a fundamentalist church, not that we attended very much. But they had a college out in Findley, Ohio that they trained ministers. So I got sent off to ministerial school abruptly, which was not anything like I would have in mind. They just drove me out there, dropped me off and went back home. So I was in college. So that's how I got to college. Long story.

FROKE: How long were you at Findley, then?

JONES: One year.

FROKE: One year. And that constituted the prep school taking care of the deficiencies.

JONES: Well, you know, I thought I was going to flunk out. Because Yale said I had to go to prep school or I couldn't come to Yale. And I knew I'd missed grammar completely, math completely. I became president of the Spanish Language Club so I didn't have to learn Spanish. I was just busy putting together all the parties . I didn't learn any Spanish. So I was really ill-equipped to go to college. So what I decided to do was – I got a room in this house where the guy - it was the same room I was told by the people that lived there and others around there, Marilyn Miller had lived across the street - and this was a room where the guy that wrote "Down By the Old Mill Stream" had lived. So I was in his room. I was just sure I was going to flunk out. So I decided the only way, I'm going to have to study more than anybody else. So what I did was I went to the library and got some books on sleep to see if I could maybe recoup some of that night time I needed for study so that I could stay up with everybody. Well, I did. I found out that the first three hours of sleep were the most important and the last three hours and the in between 3 hours or whatever it was didn't really make much difference. So that's what I did. I would study and then I would go to bed at 9:00 or 10:00 wake up at 12, study to 3, go back to bed, wake up at 6 and go to school. So I did that for a semester and I did famously. I got terrific grades. So then I figured I could get a part-time job. So I ended with two part-time jobs the second semester and one kept me there through the summer. One of them was sort of in show biz kind of a thing. There was a group that was trying to bring back Vaudeville. I played the piano by ear, and I had written this song called "Baker Street Boogie". I lived on Baker Street, 130 Baker Avenue in Sharon. So the guy said, and he was a famous old hoofer on Broadway, ...

FROKE: ... So you played bar piano?

JONES: What?

FROKE: You played bar piano? Is that what you're leading up to?

JONES: It was just they wanted acts. So I went down. I was working on this crazy sleep schedule and everything and I had this job at the Bazley's Meat Market already. It was a part time job, but they close at night. So I thought if I could get a job at night and it wasn't every night, I could have another job. Anyway, I went down there and Ray said, "Well what do you do?" I said, "I have this song that I play on the piano," and he said, "Well, play it." So I played it. He said, "O.K." He said, "Do I have a suit?" And I did. I had a suit. I got it for graduation. So he said to come down to the Findley Theater at 8:00. What they did was a movie, then the show.

FROKE: Okay, okay. I follow you now.

JONES: So I said, "Well, what do I do?" He said, "Well, you just go back stage and we'll have an emcee. Do you know what an emcee is?" "No, I don't know what an emcee is" So he had to explain what an emcee did. "So this guy's going to call you out and you're going to play your song. There'll be dancers and magicians and all that kind of stuff. You're going to play your song, and people clap a little bit and then you walk off." That's what I did. Then so that - anyway, it's a long story - so that got me into dancing. He said, "I bet you get pretty good grades at school, don't you." And I said, "Yes, I do, currently." He said, "Well, look, how would you ... I have this prize student who lost her dancing partner and she's an adagio dancer and she needs a partner." I said, "Well, I can't afford any dancing lessons." He said, "Well, I'll teach you for nothing because she needs a partner. She's paying for dancing lessons." So I said "Okay." So we started doing that a little bit, then he said, "Have you ever thought about tap dancing?" I said, "No, and I don't have any money." He said, "Well, but you work at the meat store." I said, "Yes. Well, I get a discount at the meat store." So I sold everybody in the studio meat from the meat store and I get a discount so I used that to get free tap dance lessons. So all this ended up in the papers. And this is a very religious school. We had mandatory chapel three times a week and swimming with girls was sinful and dancing was sinful and it was hard to do anything that wasn't sinful. One day, I didn't know this, but it showed in the Entertainment Section – is my name and I think my picture or something. And the dean - it's a small town, he reads the papers – so he called me and said, "Is this you?" I couldn't lie to the guy so I said "Yes." So that was sinful. But then school was over. So anyway, but I was going to get kicked out of school basically if I continued these sinful ways.

FROKE: So you left before you were expelled then?

JONES: Yes, so I went back to Pennsylvania. My father, of course, heard about all this, and he liked music and it was okay to play the piano, it was a manly thing. But dancing was a sissy thing, and he was worried about the surrounding people. So I was sort of summoned back to Sharon and I explained, "Look, I just can't go to school out there because there's nothing to do. I can go to school, but you gotta be doing something else because there's nothing else to do in Findley that's exciting for me." So we agreed that while I could transfer to Allegheny College if I could get good grades.

FROKE: In Meadville.

JONES: In Meadville. So I transferred to Allegheny College. Then life was more fun. It was sort of a little country club college – a great, great college – had a great experience there.

FROKE: Majored in economics?

JONES: I admit I just barely majored. I was there for 2 ½ years and counted up my credits and I had enough to graduate. I was a semester ahead of everybody else so I decided I'll take the last semester in the school of hard knocks. The Korean War was on too. The draft was chasing everybody too. So I hitchhiked out to San Diego, and I had $50 or something like that when I left. I thought that was enough money. But I was broke by the time I got to San Diego. I had no money so I went to the YMCA and they let me stay there and live there until I could get a job, which I did. I got a job at the aircraft factory there, General Dynamics, putting jet pods on B 36 bombers, and there was a Greek restaurant. In fact, about 2 years ago I was out in San Diego and I tried to find this Greek restaurant. The YMCA is now a PacTel switched site. The Greek restaurant is gone but the guy used to give me free rice pudding, so I'd have something to eat. And he was such a terrific guy. When I'd had my rice pudding, I'd see other people getting it. He took care of everybody. This guy was really a good human being. But he was gone so I had no way of getting a hold of him to repay or anything. Then I end up in the Navy.

FROKE: So you went from Allegheny College out to San Diego and then into the Navy where you were an officer.

JONES: You know, that's a kinky story too. I had two brothers who were master sergeants in the Army. One of them, just died recently, was ...

FROKE: ... Were they older than you?

JONES: They were older, but I had three remaining brothers and a sister, two of which were in the army - had been in the army. One had went through the Battle of the Bulge and was the first to cross the bridge or a mog and he just went and opened up the death camps in Auschwitz. He just did everything, and then never appreciated till later in life. And my other brother was down in Italy. And they said, "Glenn, whatever you do, do not, do not go to the army. The army is all screwed up. It's a messed up place. Don't do it." But it was 21 months in the Army, 4 years in the Navy. So I decided, "Well, I mean, I'm going to go into the army." 4 years seemed like a lifetime when you're that young.

FROKE: Sure, sure.

JONES: So I enlisted in the Army, went down to Pittsburgh to go through the enlistment process and indeed it was a mess because the draft was on and there were just hoards of young people getting drafted. I remember I went down on Thursday, it was Wednesday or Thursday, and they said all you needed was a toothbrush because where you're going, that's all you need. So I went down there with my toothbrush and I had a big going away party. So I went down there with my toothbrush. So Wednesday goes by, Thursday, Friday. I finally got all my shots but it really was confusing. And I took the test for OCS paratrooper school with a whole roomful of guys, some of which I talked to. They didn't seem too bright, others were. I noticed that everybody passed. Everybody passed in the whole room. I started thinking to myself, how could everybody pass? And I was thinking about what my brother said. Then I had to stay over the weekend because we had to get sworn in yet. And they gave me a chit for one meal a day at the Y. These guys don't really have it put together very well. And the words of my brothers kept going through my mind. I didn't know what to do though... I'm ready to get sworn in so .... But my name is Jones. That's always confusing because there's always 10 of us in any crowd. And so we're getting ... I had my hand up, we're getting sworn in... and I finally said, "Sergeant." He said, "Yes." "My name is Jones. Did the sergeant tell you about me?" He said, "No, get out of line," because he didn't want to slow it down. So I got out of line and so it worked pretty good. It gave me a little more time. So I went back through every place I'd been and picked up all my records and walked out the front door as the sergeant said .... Then I really didn't know what to do then because I could have been in big trouble. So I walked upstairs, I think it was a post office, to where the Navy recruiting office was. There was a guy that I didn't know at the time, was the chief petty officer sitting at a metal desk there with a polished floor. The thing was quiet and serene, little chair beside the desk. So I walk in with my records, and I'm sure the chief knew exactly what was going on. I said, "Is this where you join the Navy?" He said "Yes. Sit down. What do you have there?" "I have some records. If I joined the Navy would I have to take my shots all over again, and my physical?" "Nah, we can use the same stuff here. This is good." So I joined the Navy. I ended up in the Navy anyway.

FROKE: What would have prompted you to, I suppose, volunteer for hazardous duty in your first encounter with the Army? You mentioned you were going to join the paratroopers and then with the Navy you certainly didn't go to anything less hazardous with demolition - underwater demolition. Those things are ....

JONES: I grew up in the woods of western Pennsylvania. I spent all summer outside, in tents, under the stars – all summer and part of the winter. I just thought that could get along in the Army. I could do anything outside. I can survive. But in the Navy it was a whole different experience because it's water. You couldn't go to OCS in the Navy because everybody ... OCS was just chuck full. In my boot camp in San Diego over half the people had their master's degree or bachelor's degree and every single one of them had applied for OCS and there were 5 companies going through when I went through, so 2,500 guys. I'd say half of them had been to college and wanting to get into OCS. I got into OCS. I was really lucky.

FROKE: With your corporate headquarters here you have a flag prominently displayed. It's not a small flag by any means. Was there some aspect of patriotism that ...?

JONES: ... Sure ...

FROKE: ... that you grew up and had a real sense of loyalties.

JONES: ...that runs in the family. The family's sort of super Americans.

FROKE: It sort of runs in cable too, doesn't it?

JONES: Yes, it really does. Yes. I know my two brothers were in the army and the other two of us were in the Navy.

FROKE: When we speak about you and others within the cable industry as being the classical entrepreneurs, that all plays into it too from a point of view of values of the country.

JONES: Yes, I think so. Johnny Rigas, for instance, is a good friend and just a wonderful, wonderful person.

FROKE: Alan Gerry another one?

JONES: And Alan Gerry in the Marine Corps. Johnny was in the armored division. It's just everybody pretty much had gone through that process. Magness was ...

FROKE: ... Later we'll talk more about that again. I'd like to go back again to Sharon and to Hickory. How old were you when your father died?

JONES: He died two years ago.

FROKE: Just two years ago?

JONES: He was almost 96.

FROKE: Oh, my Lord. He had a long, long life.

JONES: Yes, yes, he did. He carried his own canoe. He was up over 90, and he was complaining to me one day up in Canada. We have a cabin up in Canada along this lake that we've been going up there for – ever since he was 25 years old, or 22 years old.

FROKE: It was literally carrying his own canoe. I thought you were just being figurative about it.

JONES: He was complaining he was having trouble portaging around the beaver ponds, but he was 91.

FROKE: Your mother?

JONES: She died quite some time ago. She died before she was 80.

FROKE: Your other brothers – are they still living?

JONES: Yes, except for my oldest brother Bill and, of course, Danny that got killed by the car.

FROKE: What would have prompted the business people of Sharon and Hickory to put together a money package for you to go to Yale?

JONES: You know, I really don't know.

FROKE: Were you identified as a precocious youngster?

JONES: I don't think so.

FROKE: Something very special in that small town environment that got their attention?

JONES: No.

FROKE: The Boy Scouts probably?

JONES: That probably had a lot to do with it. I was a swimmer and they sort of used that as an excuse. Why should a guy, ... you know I wasn't that good a swimmer, was very at home in the water, taught life-saving, swimming. I just wasn't alert enough to really pick up on that. It really was a very foolish thing to do to turn it down and not to grasp that opportunity.

FROKE: You got to that later, though, by going to the University of Colorado and getting your law degree.

JONES: Well, I went to the University of Pennsylvania for a couple years after I got out of the Navy, the law school.

FROKE: Was that before Colorado?

JONES: Yes. When I got out of law school I had a lot of experience with explosives and things in the Navy. I ran out of money after my first year at the University of Pennsylvania Law School and came out to Denver and tested the explosive components of the Titan I ICBM – never blowing up on the pad at the time but we ...

FROKE: This was with the Martin Company?

JONES: Yes. It was just called Martin Company then. I was working out of the old bunkers that General Custer used at Fort Logan. I kept my explosives in there. I tested the launch bolts, the separation system and the strut system of the Titan I, then made enough money to go back to law school. But I was now a year late behind my classmates. So I went back to the University of Pennsylvania Law School and then came back out to Martin Company and became a Senior Industrial Engineer because this group I had worked with had grown, had mushroomed. By the time school started I wasn't finished so they let me work at night and I went to the University of Colorado during the day. So I finished here. Then I didn't have enough money to go back to Pennsylvania because I was broke so I stayed out here.

FROKE: Going back a bit and picking up the chronology of your Navy experience, where were you based once you had finished your training with the Navy?

JONES: I finished boot camp and I was going to be a coxswain, an assault boat coxswain taking Marines in the beach. They had sort of a competition in boot camp. It was called American Spirit Honor Medal. Every company selected an honor man and then you competed with other people and there were 25 of these companies in the regiment. Then the winner became the overall American Spirit Honor Medal winner. I lucked into that. And so graduation used to deal with the captain and the admiral and watching all the other guys march by which was interesting. So I was in the out-going units, barracks waiting for sign, waiting for school to start over at the amphibian base. So I was down with my sea bag with a whole bunch of other people getting on LCNs to go over to the phib base to take our coxswain training. This lieutenant came down and started yelling, "Jones, Jones." There are always a lot of Joneses so I didn't answer right away. Nobody answered. There were several of us there. So he finally said "Glenn R. Jones" and he read off my serial number, so I said, "Here." He said, "Come with me." So I picked up my sea bag and started following. I thought I was really in deep trouble because, you know, I could have been. And I thought I was going straight to the brig or something really bad was going to happen to me here. So I said, "Lieutenant, where are we going?" He said, "You're going to OCS." It stunned me. I said, "Why?" He said, "The captain is sending you." So the captain of the base just reached out and sent me to OCS. That's how I got to OCS. All those others guys just weren't as lucky. So then I went to Newport Beach, or I mean Newport, Rhode Island and hung around for a month or two waiting for OCS to start, got out of there, and went to the amphib's assault corps. I tried to get down to water demolition teams then but my eyes had crashed on me. I sneaked in and memorized the eye chart the day before I had to take the physical. But damned if the very next morning they changed from the old, sort of blind thing. They came in and put in an electronic... So I flunked the eye exam. So I went to the amphibious assault group in the Pacific. It was during the Korean War so everybody got assigned pretty quickly. I ended up on an APA as a boat officer with a wave of LCVPs [landing craft, vehicle, personnel]. But then they lowered the standards for this certain element of underwater swimmers and it was an EOD designated, the EOD team was Explosive Ordnance Disposal which is sort of underwater bomb disposal. So I had been on the ship for about a year, and so I applied - went over to the submarine tender and took decompression test, and they jerked me off that ship right away. And I was back in bomb EOD school, bomb disposal school. It was just kind of a nothing flat because they were running out of volunteers. They took the top 5% of us and sent us to thermo-nuke school, so I made specialist thermo-nukes. But we could do everything from cannon balls to thermo-nukes, but mostly underwater, sort of a special kind of frog man.

FROKE: Demolition, to define it then in the context of your work in the Navy, was to find underwater bombs that had not exploded.

JONES: Unexploded, but we worked with the Rangers. We did clean-ups and stuff like that, you know, wherever it was, including underwater for us. But the rest of the services was up to the water line. But the underwater stuff was neat because we were deep sea divers with hard hats. We used everything, all the sneak devices, all kinds of crazy things that we had for underwater stuff.

FROKE: Did you have any close calls, so to speak, with explosions nearby.

JONES: Well, not so much from the explosions although my submarine doctors told me I was going to lose my hearing very early - I still have it – because of all the explosions. But I have been in trouble a few times, and I didn't think I was going to get out of it, underwater.

FROKE: How long were you in the Navy?

JONES: 4 ½ years. I ended up in charge of the underwater section of the EOD school in my last tour.

FROKE: That included then a reenlistment period.

JONES: No.

FROKE: No?

JONES: Well, actually it did. I had to extend because I had this time. I had been accepted at the University of Pennsylvania Law School, and I wanted to go there because that's where Benjamin Franklin lived, and I was really into Benjamin Franklin and all that. So I had this - by then I was married and had a child - and I had to fill this dead time. I put together two expeditions ...

FROKE: ... You were married while you were in the Navy?

JONES: While I was in the Navy, yes. I got married one day and then the next ten days I was working with the Rangers down Eglin Air Force Base [Florida] in the swamps.

FROKE: You had a funny honeymoon.

JONES: Yes, it was funny. Then I decided, I've got to have something to do this 3 - 4 month period that was gainful employment. So there was a treasure called the DeGroot treasure, which is an old Dutch treasure. It had gone down, if I recall, off the coast of - it's a long time ago - the coast of New Jersey. It was a quarantined area, a military quarantine which means probably they dump all kinds of bad stuff in there and do bad stuff in there, and they didn't want you in there. And you don't want to be there either. The guy that was a famous old diver, his name was Captain Johnson.... I had a good percentage of all the Navy's master divers working for me at that time, being in charge of the underwater section of the bomb disposal school . They told me about this guy. He's the guy that would blow ships into the ocean floor that were navigation hazards like in Inchon he did it, and I think San Francisco harbor, Halifax, you know, where there were problems. He'd had the bends several times and he was really all messed up and he couldn't dive anymore and he was older. I went over to see him because I'd heard he'd know, that he had been down on the DeGroot treasure. He explained to me where it was and what the tides were like underneath the water and everything. But I couldn't get permission to dive. He claims he had been down. So I never did get permission to do that. Then I put together an expedition to go down on the Andrea Doria which had just sunk. The Washington Post was going to finance it but they backed out at the last minute. So I just re-upped the Navy for another 4 or 5 months to be gainfully employed until I started school.

FROKE: Why did you choose the University of Pennsylvania for your law degree? You mentioned Benjamin Franklin and the historical significance.

JONES: Well, I grew up in Pennsylvania and I greatly admired the University of Pennsylvania, still do. It was the premier place to go. I knew nothing about law, but I thought I might be interested in politics or it might be a good background for business. So I applied and got admitted. That's why I went there.

FROKE: Your demolition work led to your first job then to Denver.

JONES: Everybody used to laugh at me. They said, "That's great, Glenn. You've got a nice fall-back profession that's in great demand," - at that time. Now it is. These forces got a guy like ...

FROKE: This was the time when nuclear bomb development ...

JONES: Oh, yes, it was wild. It really was. We were on the ragged edge of everything. We had acquired, one way or another – I won't get into that – materials from your friends and enemies because you have to know how this stuff is put together if you're going to take it apart. The rest of the world did the same thing, pretty much. I knew that they were building an ICBM in Denver, basically because of my work. I was very good. I could write my initials in 8" armor plate with safe charges. I knew how to do that. When I ran out of money in law school I said, "I'll go out to Denver because I've got to get a job that I can earn enough money to finish law school." So I came out to Denver. I can remember going out to the employment agency on Logan Street. I think it's still there. This guy is sitting at a metal desk and the guy is behind it and I'm in front so it's my turn. I asked a few questions. He said, "Well, Mr. Jones, is there anything you can do particularly well?" I said, "Well, yes, I'm a deep sea diver." He just lost it. He walked out and I could see guys walking. I knew I had said the wrong thing. It was just a stupid thing for me to say. The guys that walked by, look in and snicker. Finally he had his composure back again, he came in and sat down and looked at me. "Well, Mr. Jones, I have to tell you we have hardly any calls at all for deep sea divers here in Denver." I knew I had said the wrong thing. I said I had worked in a steel mill. He said, "Oh, okay." Well, they fabricate this missile ... because nobody knew ... I knew what they needed, but I had to get into the factory.

FROKE: In order to get the right words.

JONES: So I got a job because I was in the steel mill and they fabricate the missile body and so forth, doing that. First off, I started poking around and I found the lab. And the guy who was running the lab, I introduced myself, and he looked at me and he said nothing for about a whole minute. He said, "I've heard about you kind of people. I've been looking, and I just haven't been able to find any, you see." He just hired me into the lab right away and raised my salary and sort of put me in charge of the test sight which was then being run by a guy that blew the holes through the mountain for Route 6 tunnels. He was a different kind of, sort of thing.

FROKE: Were you still playing piano at that time? You obviously went on to become a fairly skilled pianist even though you were ...

JONES: ... No, I've always ...

FROKE: ... your starred in you first performance when you were back in _____

JONES: I always thought I wanted to be a musician, but I could never afford it.

FROKE: In your office here at your corporate headquarters, my recollection is that you have two grand pianos in the office.

JONES: Right. I do like to play but, as I say, I play by ear so I can't play with anybody because I'm two notes behind or two notes ahead - not like our friend Mr. Crosby who really knows what he's doing and is very skilled and is a terrific piano player. I'm not that good. If I can hear I can usually play it.

FROKE: Whether it is classical or popular?

JONES: Well, not so much classical. I'm intending to get into the piano but I just haven't had time.

FROKE: From the Martin Company here in Denver, you had the spring board, then, to cable development and you met Carl Williams who was working at that time with Bill Daniels. Was that your first cable contact?

JONES: I had never heard of it before. I was talking to Carl about this, and we think it was maybe 1957 or something. It was a long time ago in any event ...

FROKE: You had your law degree by then.

JONES: ... yes, and we were both living – we had apartments in this sort of big old house that had been chopped up for apartments. We were both out hanging laundry in the back yard so we met over the clothes line. We just sort of hit it off. Carl's a terrific guy, an easy guy to get to know, friendly, engaging. We just became friends. Then I finished law school here and then got a job at the law firm. I just decided, after about 9 months, I'd start my own. So I left. But then I found myself officing in a donut and coffee place on the corner of Holly and Florida. All you need is a yellow pad and a pencil basically because you're dealing with ideas and things like that. But it got kind of embarrassing to have clients come in there. Plus the guy that owned the coffee shop was sort of getting tired of all this. Carl kept pinging on me ...

FROKE: Your office was at the donut counter then. Is that right?

JONES: Well, it wasn't at the counter. They had tables there.

FROKE: One of the booths?

JONES: One of the various tables, right. It wasn't a very big place so I couldn't hide real well. You can only eat so many donuts. Carl kept pinging on me. "Look, we just moved down from Wyoming and we have this new office building. We've got ... why don't you come in and we'll give you a free office space and you can keep track of our corporations in other states." So finally I said okay. So I moved in. He was Bill's partner. I ended up being a deal lawyer there.

FROKE: So you handled their legal practice then.

JONES: Some of it. At first I just ... my other client was a Southern Baptist Church in 11 states. My salary actually doubled when I went out on my own, even out of that donut shop. I had two principal clients. I had a lot of clients the way it evolved, but two principal ones. One was the Southern Baptist Church who were just delightful people and the cable industry. When you'd close a deal, whoever was on the other side of the deal would hire you for their next deal. So it was like a virus. You just ended up representing everybody.

FROKE: Was the legal work with Daniels at that time primarily franchising or was it brokering?

JONES: He was a broker in those days basically. Marty Malarkey was already in the business. I remember Marty, and he was sort of the authority. Bill used to call Marty -who was a fabulous guy. I just knew him by phone. I hadn't met him at that time, just talked to him on the phone. Bill is very adept at putting together deals and he's the world's best salesman basically. He was an insurance salesman basically.

FROKE: There's a certain amount of carry-over.

JONES: Yes, he really knew how to close. He was terrific on the phone.

FROKE: Do you recall any of the cable projects that you worked on when you were doing legal work for Daniels at that time?

JONES: Oh, yes. Lot of them. Oodles and oodles of them. They were all fun. I used to find myself watching the sun come up in the morning, just putting deals together all night and have papers all over the building. Before anybody would come to work I had to have them all together in piles. It was pretty messy at night, in the early morning hours. They were each interesting and intriguing. I remember one of them - I think it was down in Farmington, New Mexico - which was maybe the first deal I did. The economy finance, which was a real misnomer, was the financing entity for the buyer. I went down to close the deal and I remember this guy sitting there, _____ , bib overalls on, just a real country guy. I think I gave him a check for something like a half a million dollars - looking at this guy and gave him a check for a half million dollars.

FROKE: That's a lot of money at that time.

JONES: Yes. Really. What's happening here? So then I talked to him afterwards, and I asked him what he was going to do. He said, "Well, I think I'll go build me another cable system someplace else." So it started to get my attention. But there were just a lot of deals, everyone of them wishing they'd ...

FROKE: ... Did you get involved with any of the regulatory work?

JONES: In those days – yes, at the city council level but – in those days the FCC disclaimed any regulatory authority, in the early days. It wasn't until LBJ got threatened in Austin with his television station that we got regulation. I think he was in charge of the oversight committee, overseeing FCC at the time. Anyway, they were intriguing ...

FROKE: What did you do with the Southern Baptists? Did they have that much legal work?

JONES: You know, the way I got involved with them is a lawyer down in Pueblo told them that they could issue bonds, and it was okay. They didn't need FCC approval because there was exemption, as I recall, in their bonds. So they did. And they did so in good spirit. Their lawyer told them they could do this so .... But what ended up was these bonds are guaranteed by the Securities and Exchange Commission or something... bad language and this had been going on for several years and when the FCC got a hold of one, they had sold millions of bonds. They had apoplexy. So we had to reorganize the whole structure, sort of like an S&L, keep the bond company separate.

FROKE: So that involved travel across the country too.

JONES: An eleven state area because we would lend - we'd build a lot of churches - to congregations just starting up. I spent a lot of time with them doing that. They were incredible. They were blessed and overseen by somebody. They had special things going for them. Every once in awhile one of the loans would go bad and the way the Southern Baptist Church works, they're all autonomous. So nobody could... I mean you can't hire and fire a Southern Baptist preacher, only the congregation can do that.

FROKE: Were you active in religion, a church experience?

JONES: No.

FROKE: So the Baptists, the Church of God and so on did not necessarily ....

JONES: ... Well, they jokingly called me the bishop because I would go fire the preachers that had gone astray. I would arrange for their departure if they turned strange, if they sort of dispersed .... The congregation started taking control of the assets themselves. Then somebody had to go take care of that. I would go do that. We sort of had a routine down for that – get them to resign, interesting process.

FROKE: Earlier, as I continue to talk a bit about your family, earlier you had mentioned while you were in the Navy you were married and you had one child. You were divorced from your wife?

JONES: No. About 23 years later. No. We separated when I came out to Denver.

FROKE: I see.

JONES: Then we got back together and stayed together for a long, long time.

FROKE: Then you were divorced then at a later time.

JONES: Yes.

FROKE: Your child, are you close to your child?

JONES: Very. I have three. We had three children. I am very, very close to all three of them.

FROKE: Do they live in the Denver area?

JONES: One of them does. One of them lives in Dominique, in Florida, typically. But she stays with us during the hurricane season. My other daughter lives in Manhattan and she has two little boys. And my son lives out here.

FROKE: Is your son involved in cable?

JONES: No, none of them have any particular interest in the business.

FROKE: So they went their own way in terms of their careers.

JONES: Yes, and it's interesting. It would have been nice if there was more interest but you can't impose your dreams on somebody else. And I think that they just saw how hard it was and how hard I had to work, and they didn't want to do that. I set really a bad example, I think is probably why. Johnny's done a great job, John and Chuck - their kids ... And Ralph Roberts, you know Brian just loves the business.

FROKE: There's quite a bit of family ...

JONES: ... There is. And those are companies that sort of, if you notice the landscape out there, have stayed together because they have a second generation that can ... and these assets need another generation to maximize them. But if you don't have it, you don't have it, and I didn't have it.

FROKE: Well, you certainly had lots of other things. Let's go on then and move into your early days of cable. You certainly got a touch of it when you were working with Daniels. And then you decided to move into politics and you ran for congress.

JONES: Right.

FROKE: Was that another one of your expressions of getting involved in public type activities.

JONES: Well, in a way, maybe.

FROKE: Were you seriously considering a political career?

JONES: Well, I was angry because my client, the Southern Baptist Church - we were trying to build senior homes which the government had espoused and encouraged everybody to do, but had, it seemed, changed their mind without telling anybody. They were spending thousands of dollars on architects and everything, and they could never get anything approved with the FHA or HHFA. So I finally - we spent so much time with just needless, senseless, bureaucratic red-tape - so finally, I remember I talked to the authority in this area at that time for this project. His name was Mr. Shous, was his name. I got through a few secretaries and got him and was talking to him. "Well, Mr. Shous, what do you recommend that we do?" And this is the authority. He says, "Well, my direction has been sufficiently vague so that ..." and then he rambled on. I had no idea what the hell he was trying to say. So it just angered me. And about that time I read Barry Goldwater's "Conscience of a Conservative". So I asked myself , "Are you going to – government shouldn't be like this - are you going to put up with this or are you going to go back and change everything?" So I said, "I'll go back and change everything." So I decided to run for Congress. It was probably a big mistake because I did that for nine months. I just ran for Congress. First I had to get the nomination. I hadn't been involved in politics before, and I was kind of brittle. You learn a lot. It was ugly, but I got the nomination. But I killed a lot of people in the stands in terms of people I needed to support my candidacy in the party, in the organized party. I didn't' run for dog catcher, or state senator. I was running for Congress, just out of the chute. I was in my early 30's and I hadn't lived here long time, to speak of. It was a 7-term incumbent that I was running against who was very imbedded. I got the nomination. Sort of at the end of the election, everybody sort of got with it and really were supporting me – in fact asked me to ... they offered me a safe senate seat, state senate seat. But I turned it down because I was broke. I was absolutely, financially and physically devastated. So that sort of ended my political career. I could tell, number one, I really didn't want to do that. And two, that I couldn't afford to do it. I had to survive. So I ended up going ... I couldn't get a job that would pay me enough money to pay my bills, so I was driving home one night - and I moved to a bigger house because I had some equity in my house and I had all the sort of licenses known to men. I had a real estate broker's license, and I was a lawyer. So I had built up this equity in the house I was living in, and I sold that and got the equity out and used some of it as a down payment for a bigger house out in a real nice neighborhood.

FROKE: You had three children at that time.

JONES: Yes. I used ... but I was a broker so I got more than I paid down for a brokerage fee from the savings and loan that was trying to unload this house because the real estate market was, you know, in the pits, the real estate market it was, you know, in the pits. So I ended up with a little lump sum of money which I would eat through pretty rapidly if I wasn't working. So I decided - I was driving home one night, and it was ... one afternoon, it was a beautiful fall afternoon, snow was on the second range, just a pure white - and I decided well, the silver kings went up in the mountains and struck it rich. They worked. Maybe I could do the same thing somehow. So that's what I did. I went up in the mountains with my Volkswagen and I lived up in the mountains in my Volkswagen and I did everything. I saved lots from the shylocks, you know, subdivisions, and I merged water districts. Most of the lawyers up there were alcoholics at the time. They wouldn't show up for trials sometimes. I remember the judge in Leadville. He wasn't even a lawyer. I mean he had a set of law books still in the wax paper by his desk where he held court. The assistant district attorney was a, well let's say he liked his booze, and sometimes he would show up and sometimes he wouldn't. You couldn't get the judge to do anything and every time you came to an issue of law, he read off all these cases like you do if you're a lawyer and you have a brief and everything. But he would just turn to this other guy, this assistant district attorney, and say, "Is that right?" It was incredible. Anyway, I could make enough money. I had a paper route I had started in Georgetown, and I had a friend who owned a restaurant there – the Alpine Inn. He would let me use a table. I could have coffee at the table all morning so on Wednesday mornings I was in Georgetown if anybody wanted to do any legal thing or real estate thing. They would come into town and down from Empire or wherever and come to my table. And we would conduct business. In the meantime I'd be having coffee with the owner. Then I was trying to buy a cable system but I didn't have any money ... so I could buy for nothing...

FROKE: You had cable on your mind then.

JONES: Oh yes. Leadville had a big cable system in my vernacular at that time. But it was owned by people I couldn't buy from. But anyway, so then I'd go up to Breckenridge and I would go to Breckenridge and there was a subdivision that had been in trouble there. I could work up there laying out lots and helping draw up the subdivision and building the duplexes and things like that. Then when nightfall came I would at some point in time typically, not always - sometimes I could sleep in one of the unfinished condos or something like that - but typically I would go from there up to Leadville. I'd go to the Silver Queen and get a hamburger or some nuts, maybe 10, 11 o'clock at night. Then I'd go sleep in my Volkswagen because the seat went down. Then I'd get up in the morning and go down over Battle Mountain to Minturn where I had another friend who was a rancher, Jack Olson. I'd stop and have coffee with him and he had ranches all over the place. We ended up making a ski area out of his ranch there because Vail wouldn't let us sell any of their real estate because it was a sort of a closed shop there. So we had to create our own – which they eventually bought and closed down.

FROKE: That was in the very, very early years ...

JONES: ...Yes, it was in the 60's.

FROKE: ...choice development in Breckenridge and that whole area.

JONES: Oh, yes, you could sleep on the main street of Breckenridge all night long and never worry about getting run over. I have a million stories. It was a great place. These people were characters that lived up there too.

FROKE: Did you drive back and forth in your Volkswagen to Denver then to ...

JONES: ... No, I'd stay up there for typically a week, maybe two weeks.

FROKE: Then come down for a weekend?

JONES: Something like that, yes. Then I ended up saving the Four Seasons subdivision in Leadville from the shylocks. The guy that owned it gave me 20 lots. So then I had my own street because with the lots on both sides I could park my Volkswagen there, go ... because I owned the street. Then I would meet the miners at 11:30. They'd come out of the Climax molybdenum mine - these electric trains. And I'd meet them up there and they were living in these tenth mountain division barracks that they'd moved into town from Camp Hill. They would take me home with them because they all wanted to build these Boise Cascade prefab houses but they had to have a lot. And I would sell them a lot and not take a first mortgage and nobody else would do that. They were wonderful people. They would give me a second mortgage or just even a note. They all paid me. I didn't worry about that. So we'd go home and talk about their dream of prefab house and they'd get tired, and I'd get tired. So I'd go to my street and go to sleep.

FROKE: Is there still a Jones Street there?

JONES: Oh, I never named it. Yes, it's still up there.

FROKE: You just ... it's still there.

JONES: Just roughed in. But the bulldozer DA cat scraped it out. I think I still have ...

FROKE: ... Would you sell me a lot up there?

JONES: Sure, I think I still have some.

FROKE: You might have one up there.

JONES: No, I'm sure I do - 4 or 5.

FROKE: How did you move ahead in Georgetown, then to acquire the cable system there which was your first start.

JONES: Yes, well, the guy that ran the cable system – his name was Mel Reichwine – he owned the post office building and he was an electrician and a plumber and owned the cable system. As a consequence, his phone was always ringing. You could send Morse code on his phone in his house. It was just ringing all the time. The cable system was just in terrible shape, and it was going to get its license revoked. In those days you really had to be bad to get your license revoked. But he hated lawyers, and Eddy knew I was a lawyer. So what I would do is, I'd get a couple cups of coffee at the Alpine Inn in the wintertime, and then I'd drive around town and find his green panel truck - maybe down the basement, cranking on a pipe or something - and I'd go down and give him a cup of coffee and we'd sit there and talk about the cable system. I did that enough so he finally thought I was okay even if I was a lawyer. He had, which I won't get into, he had good reason to not like lawyers. Finally we cut a deal. I bought that system for $12,000, $1,000 down in cash and unsecured note back because everybody knew it had to be fixed up because it had 220 volts, I think, going straight up - 220 or 440, I forget what it was – up 8,000 feet, open line, you know, to the top of the mountain and then it came down and went into a shack at the mine where a hermit lived. There was a dirt floor and everything. I used to give the hermit a bottle of Chavez Regal every Christmas and he thought I was the greatest guy. He was kind of on the sauce and he lived ... I don't know how he ... he was really a nice man, but.... So that's where sort of the headend was. Then it went from there out to a tree. Then it went to a lilac bush. Then it went to the eaves of the first house. It went all around. It didn't touch a single telephone pole anyplace. And it was falling down. And not only that, it was killing things. It was killing deer, it was killing rabbits and squirrels, but no people. It was the headend line and it was in the wintertime. There was 8' of snow. It's frozen. You couldn't do anything. So I had to sweat out until summer came to do anything with it. And I didn't have any money anyway. I don't know what I would have done. What happened was I had ten days to raise $1,000 and I couldn't do it. I didn't have $1,000. No way I could get $1,000 so I ... The Southern Baptists preachers helped me get this Volkswagen cheap because they ... through their missionaries in Germany ... that I was living in.

FROKE: So that was part of your salary that came from them?

JONES: Yes. I had equity in the Volkswagen. We used to have industrial banks in those days in Colorado, just one step below shylocking. So I went to the industrial bank and got a - refinanced it - and got a $400 proceeds check. I took it up and gave it to Mel and I said "Mel, I just couldn't raise the $1,000 but I have $400 and I will give you another note for the $600 and here's a note for the $11,000." He said, "No, you don't have to give me another note." He said, "Glenn, I trust you." I said, "Mel, I'll never miss a payment." And I never did and he trusted me. So I gave him the check for $400.

FROKE: And you took over ownership at that time then.

JONES: Yes. And he gave me - I prepared everything because I was my own loan account lawyer, and I had a half-page bill of sale so it wouldn't look too imposing - so he gave me that and he signed that, and he gave me his account book which was a half-size, three-hole notebook with sort of padded fake leather and the pages falling down in. So I took it down to Alpine Inn to my table. It was really a snowy day, and I was so happy I was yodeling all the way down there because now I was in the cable business.

FROKE: You were now a cable operator.

JONES: Yes, well he had 100 subscribers, none, none of which had paid him for many, many months. But, you know, hey. So I went down there. It was just like I thought. Everybody owed him money, and he's afraid to collect because the signal was terrible. So I went down and I rented a small test set and went up and knocked on every door and went all around town and collected money. And the place was a museum. I mean, I would - because on a little set your signal looks real good, you don't see all the ghosts and everything. So I hooked up the cable system to the back of the set and said, "Look, the signal looks fine. It's your television set." And it really was their television sets too because, to some extent you could turn the dial and it would spin like a top. It didn't even click, you know what I mean. It just ... they were ancient, ancient television sets even then. So it was a classic deal. Mel built the cable system and sell them television sets. He sold them television sets. So I think everybody in town probably got a new television set. Anyway, I collected $600 and gave it to Mel and that's how I got into business. Then went, about a month later, I went down to ... because I didn't have any equipment, I didn't know how to take care of this thing or anything .... I was burning tires trying to get the ice to melt and it wouldn't even melt. I needed to put in one telephone pole and I could get 10 more subscribers and I couldn't even put in telephone so it was frozen solid. It was like iron. So I went down to Idaho Springs which is 11 miles towards Denver. The guy that ran that – I found him and his name was Woody Woodley. He was - turned out to be an ex-Navy guy - he ran the RCA retail outlet in Idaho Springs. So I walked in and his wife, Hazel, was in the front ...

FROKE: So he had a technical background.

JONES: Yes, ... was in the front of the store and Woody was in the back fixing television sets and so I introduced myself to Hazel and asked if her husband was around. "He's in the back room fixing television sets. Go on back." So I went back there and Woody was back there and he said, "Hey, you want a cup of coffee?" I said, "Sure." So had these white mugs of coffee and we started chatting and he turned out to be an ex-Navy guy. He said, "Say, I heard you bought the cable system up in Georgetown." I said, "That's right." He said, "I heard that you don't have a truck, you don't have a strength meter, you don't have anybody to take care of it or anything." I said, "That's right." He said, "Well, how are you going to do that?" So I said, "Well, I thought that I would buy your cable system, but I have to tell you up front I don't have any money." He laughed. He thought that was the funniest thing he's heard for a long time. He said, "Well, how you going to do that?" I said, "Well, Woody, I'm going to pay you too much for it and I'm going to give you a note and I'm never going to miss a payment." And he laughed. And he said, "Well, you don't have anybody to take care of that one, how the hell are you going to take care of two of them?" I said, "Well, I thought maybe you could do that. You could take care of both of them. You have a truck and you have a strength meter." He said, "Yes, I do but I'm running this business here." I said, "Yes, but I thought you could do it, and I could pay so much for each hookup or so much a month or something. We could work all that out." He laughed. He just thought he was having a funny day. By the end of the day he agreed. So I forget what I paid for that, but that was all ... it was no cash because I didn't have any cash ... I'd spent my $400 up in Georgetown.

FROKE: But now you had two cable systems.

JONES: Yes, he had 100 subscribers too, and his subscribers were paying him, but it was still old, archaic stuff. It wasn't even in the town proper. His cable system was up Soda Creek Gulch and Chicago Creek Gulch. They totaled 100 subscribers in all. Later we got a franchise for the town, built the town.

FROKE: Was he something of a partner with you then, would you say that?

JONES: No.

FROKE: He was an employee then.

JONES: Yes, he became an employee. Finally he closed down his shop and came with me full time, stayed with me for years and years.

FROKE: As technical director?

JONES: Yes. We used to have ... I had him on my board ... because the name of my company was Cowpoke Cable Company at that time.

FROKE: Was that a carry over of Denver as cow town?

JONES: Well, I didn't want appear like I was overbearing or something.

FROKE: Oh, okay. All right.

JONES: I knew I had to deal with little towns so I figured Cowpoke Cable Company's not going to ...

FROKE: ...Scare anybody away.

JONES: You know I'm not from New York or Los Angeles. But what happened was, when we applied for the franchise for Idaho Springs, they didn't particularly know what cable was.

FROKE: You were moving into a larger community.

JONES: Yes, because Chicago Creek and Soda Creek were sort of outskirts of Idaho Springs. What happened was, they said, "Yes, sure...you want to do ... you're sure ...we don't pay anything...you're going to pay us?" "Right." So after the meeting, the guy that was sort of running the town at that time was the city clerk. The city clerk came up to me and said, "Mr. Jones, look, we'll probably give you the franchise but could you change the name of the company? I mean we can't, you know, ..." I said, "Absolutely, I can change the name of the company." He said, "Well, you've just gotta change the name of the company and come back in two weeks and we'll do a final reading." So I draw ... I went up to Leadville – did my tour and ended up in Leadville. It was about 11 o'clock at night and the Silver Queen was getting ready to close down and I was having a cup of coffee and a hamburger before I went to my street to go to bed. The waitress came over and I was looking over some books of some kind. And she said, "What do you do anyway? I see you in here all the time" And I said, "I'm in cable television business." She said, "Oh, what's the name of your company?" I said, "Cowpoke Cable Company." She broke out laughing. I said "Well, if the waitress in Leadville thinks that's a funny name I really need to do something about this name." Anyway, I forgot all about it and so I went down – it's two weeks later – I'm driving into town in my Volkswagen, go full - you, know, petal to the metal - and all of a sudden I remember I told them I'd change the name of the company. What name, what name? I'm driving into town and there's a mine tipple there and had a big sign on it – Silver King Mines. So I picked it up. And the guy ... I parked the car, walked in and this guy met me at the door and he said, "Mr. Jones, have you changed the name?" And I said, "Yes." And even then I didn't know what the hell the name was going to be. He said, "Well, what is the new name?" And I just blurted out "Silver King Cable Company." "Oh, that's fine." Silver King Mine was a big .... So it became Silver King Cable Company. But I to change it up because one of my first employees was a wonderful, charming lady that had escaped from Czechoslovakia, and she had run a flower factory. She was very good with numbers and so I hired her. But she had trouble ...

FROKE: ... So she became your business manager then?

JONES: She became one of my chief financial officers. ...but she had trouble with the language. I noticed I was getting mail to Silver Kink Cable Company. On Saturday, I used work on Saturday, and somebody called for Silver Kink Cable Company, ...

FROKE: ... It wasn't coming out right.

JONES: ...and I found out that that's the way she said Silver King. I listened to her 'Silver Kink Cable Company'. So everybody thought ... So I had to change the name. So I changed to Jones Intercable. That's the derivation of the name.

FROKE: What was her last name and what was her full name by the way?

JONES: Hannah Rokussek

FROKE: Could you spell the last name?

JONES: R-o-k-u-s-s-e-c. She retired ... s-e-k ... gee, I've seen it a million times I just can't ... I could write it down but I don't think I can ...

FROKE: When we get the transcript of your history, perhaps you'd just write it in.

JONES: Yes. She was a wonderful woman. She was really a major part ...

FROKE: ... In the last ...

JONES: ... she retired. She retired to Leadville.. She was living up in Leadville.

FROKE: And the last name of Mel, the Georgetown ...

JONES: Reichwine. R-e-i-c-h-w-i-n-e. He's still alive. He's living up in Georgetown still.

FROKE: I see. What a marvelous set of stories. What did you do with your Volkswagen?

JONES: You know I finally sold it. I can't remember exactly when or how much I got for it. I think I got involved in a real estate business. The paper route kept deepening so that I had more to do in each community, and I ended up in the real estate business in Vail. I bought Carl Williams' old ... he had some custom-made French provincial furniture which was really garish. It looked like it belonged in a bordello. I bought it from him for $500 and I moved it up to Vail because it kind of fit in there. And then I moved it around. It did travel with me a lot of places. It was in my office furniture. What I would do is when I left Jack's place in Minturn I would drive into Vail. I would get out of my Sears Roebuck boots and levis and stuff on and I would change into ski clothes and then I would go to sleep under this conference table for an hour or so. At 9:00 I'd open up the real estate office in ski clothes. People like Tom Watson would walk in, or all kinds of people because they were in Vail. The name of my company was Vail Realty because Vail hadn't nailed down. They had Vail everything else but they didn't have Vail Realty. Everybody thought it was ... you know, a lot of the people came to call it my deal. They didn't think that long but you know, at any rate it ....

FROKE: In those very early days of cable at Georgetown and Idaho Springs, was your profit margin adequate to take care of expenses or did you have to borrow to...?

JONES: ... Yes, I had to borrow because I had to ...

FROKE: ... You now had equity though. Oh, no, not really because they really did not recognize this ...

JONES: What happened was people would call me, people would call me, ex-clients would call me. And I kept raising my rates because I didn't want to practice law anymore. I ended up charging $350 an hour. I say, "Look I don't do this anymore." They'd say, "Well, Glenn, you gotta do this." "But it's gonna cost you $350 an hour." So they'd say okay So they'd send me off to Los Angeles or someplace and I'd have to go down to Denver and put on a blue suit and go to Los Angeles and monitor franchise deals or whatever. And then I'd take that money and I had a pool. And I had the Factbook and I would isolate cable systems in the Factbook where it had multiple owners, looked like there could be some problems with the ownership. And I had these plastic maps - you've seen these topographical plastic maps that you can buy in stationery stores. And I had one of California, for instance, and you could see where the town was so I knew where the transmitters were and if it looked like there was a mountain between a transmitter and a town and you got multiple ownership and, you know, or especially remote ownership or something like that. Then what I would do, I would go, for instance, to San Francisco. Then I would take the puddle jumper over to Redding or someplace because they would pass over where I wanted to see the cable system. And I would have the Factbook ...

FROKE: ...So you were thinking about expansion then?

JONES: ... Yes. ...and I had a pair of field glasses and I had my plastic map and the Factbook and a cup of coffee and I would ask the pilot or the stewardess which side of the plane this was going to be on. I be sure I got there early so I'd get a window seat. And I'd set up all my stuff and would fly over and look down and see what I thought. If it looked like a winner, then I'd rent a car and I'd drive there, and I'd start talking to people, see if I could buy the cable system. I bought Lake County, California that way. The Republican chairman of Napa County owned it. He's an absentee owner, and it wasn't feeling right to him up there, for good reason, which I won't get into. So he sold it to me for $50,000 down and a check for ... and a note for $210,000. So I had it all arranged with Stromberg Carlson. But it was about Christmas time and I was calling back there and this deal had to close and I was talking to janitors because everybody was on vacation or they weren't there. So I lost the deal and I had to go back and resuscitate it which they charged me more interest which I agreed to pay. Then I came back to Denver, and I used to borrow money at various banks, but I could never borrow more than $5,000 at any one bank. So what I would do was, I'd go - none of them asked me if I borrowed from other banks - so I had about 5 banks that I would go to and I'd borrow $5,000. That's how I stayed alive. Then Bob Tynan, who is my original partner, I guess, also knew the banks. And this company had some money in the bank. So Bob borrowed $20,000 or something like that from various banks and I borrowed 20 or 25 or something like that. But they were ... the long-term debt was 90 days and the short-term debt was 30 days for me. So I went out and closed the deal, drained out the bank there, came back and paid back this short-term debt and went back out and went around collected money in the rain. It was raining season.

FROKE: I'm going to interrupt this at this point and schedule another recording session with you and we'll go back and pick up some of this financial strategy that you're discussing now because one of the major contributions that you also brought to the cable industry was the imaginative financing that you developed through the years, borrowing in part some of the ideas from the mineral ...

JONES: ... Right.

FROKE: So, we'll get into some of those financial strategies at our next conversation and then move on to the phenomenal growth of your system on a nationwide basis, some of your concepts that were built into that operational system, and then also move very, very heavily into the discussion of education. Thank you very much, Glenn, and we'll pick up this conversation in a second recording session.

JONES: Okay Marlowe. You said this is liable to take longer than we thought it was going to take.

FROKE: We might have to come back for still another one.

JONES: Well, maybe we could generalize more or something.

FROKE: Okay. We'll start tomorrow at 1:30.

JONES: Okay.

FROKE: And then if you're up to it, we could run beyond 2 hours tomorrow.

JONES: All right. Or if you're up to it.

FROKE: This is Part 2 of an Oral and Video History with Glenn R. Jones, the Chairman and Chief Executive Officer of Jones Intercable Inc. and the newer organization which he has founded called JonesKnowledge.com. In the Part 1 section of the Oral and Video History, we had an opportunity to, Glenn, talk about your early life and your education and some of your work experiences before you moved into cable and we gathered one of the best stories in cable with your experience at Georgetown and Idaho Springs, Colorado. I did not ask you the question, though, did you ever get around to putting up some poles in Georgetown to rebuild the system totally or how did you move ahead to make that a contemporary cable system?

JONES: Well, I had ... you know, when they built the Nautilus submarine, they developed a thing called pert charts. So what I did was, after I bought the California system, everything had to be rebuilt, it wasn't just Georgetown, everything had to be ...

FROKE: You were telling about the lilac bushes and the cave – your master control was in the cave.

JONES: Idaho Springs was better in terms of, in a sense, but I don't think it was on any telephone poles either. In California, the system was really pretty much a junk system and had to be rebuilt as well in Lake County. So what I did was – I decided I would order about $140,000 worth of equipment, and I was relying that people would just send it to me because I was not everybody's lawyer in the cable business but a lot of people's lawyer. People were used to seeing me in that fashion and would do whatever I would ask them to do. I thought they would do that – the suppliers. So what I did, I put together this pert chart that would show critical pass if something ...

FROKE: All of those things that had to be done.

JONES: ... didn't happen on time and all these events for the whole operation, Georgetown, Idaho Springs and Lake County. Then I went to the Colorado National Bank to get a loan, see if they would lend me money. The Denver banks were really incredibly naïve in terms of the cable business. They missed the whole industry. They would lend on the worst real estate deal – if you had cattle or if you had some oil wells. But you couldn't borrow any money for cable, regardless of how good the deal was because they didn't know if ...

FROKE: How it functioned or operate.

JONES: ... No. If the deal went bad, they'd have to roll up all that cable and put in their warehouse. They just didn't understand the concept. So finally the Colorado National Bank, basically because of the relationship with them and the real estate operation up in Vail, I'd come over the mountain in my Volkswagen at 2:00 in the morning, maybe once a week, with money – there was no bank up there – and so I would have the money and I would put it in pillow cases. So I had to have a couple pillow cases full of money, and I'd walk into the bank. They called them my Polish briefcases. Anyway, they were used to dealing with me. So they gave me what they called a character loan for $10,000. It was the first $10,000 loan I'd ever had. It was phenomenal. So I took that $10,000 and sort of covered my tracks while I did the rest of it. I ordered $140,000 worth of equipment and, sure enough, everybody just sent it to me – amplifiers, and everything. By that time I had a franchise in Idaho Springs. Then I started working my pert chart. The first bubble was financing. Then I ran into a problem in Idaho Springs. The telephone company decided they wanted to do a lease back, Mountain States Bell, at that time. And lease backs were a disaster. There was one down in Manitou Springs. They wanted to lease me 5 channels and they would own the rest of the system for all the futures. I would pay for the whole plant, and I would be at their beck and call and mercy doing a good job of maintaining my plant, which they'd have no interest in doing anyway.

FROKE: Sure.

JONES: So what I did, I created a critical path for me on my pert chart. I ordered a whole mess of 25 foot creosote-treated telephone poles and had them delivered to Idaho Springs. My franchise allowed me to set my own poles. I started setting my own poles across the street from the telephone company poles in Idaho Springs and started building my cable system. I happened to notice that the Mountain States Bell was having a rate hearing in Denver to raise the rates. I remember I was really sick – I had the flu. I went down to the rate hearings and asked to be heard, and they let me speak. So I explained to them how Mountain Bell was violating the anti-trust laws and operating restrainer trade and everything up in ...with this pole contract or denial and the pole lease-back concept. And the operating Vice President of Mountain Bell was aghast that I was there and saying all this in the rate hearings. He stood up and said, "Where is this taking place?" And I said, "In Idaho Springs." In two days I had a pole contract in Idaho Springs so I stopped setting my own poles. But they're still up there. If you drive, there's poles on both sides of the street. So that cured that bubble, that critical path. I finished everything just like I did the submarine - on time. So that's how I got basically financed and into business.

FROKE: While you don't own the operating system in Georgetown today, I assume that it is still functioning?

JONES: Yes.

FROKE: It's still operating?

JONES: It is.

FROKE: Do you ever go back and just look at the system and see what the customers are doing?

JONES: I have a townhouse up in Beaver Creek so I ...

FROKE: So get by there quite ...

JONES: ... drive past it all the time and Idaho Springs. I always say to Diane, when I'm driving by, "No antennas in Idaho Springs." Once in awhile there is an antenna ..

FROKE: Satisfied customer ...

JONES: ..."who is that guy with the..."

FROKE: Are you tempted to take your monitor into some of the houses?

JONES: No, no. That was a real drill because they were stealing signals. One of these little Victorian houses, the whole front of this house, the whole front inside, was covered with aluminum foil. And he was picking up radio signals. Even that hadn't worked for him. But it was funny to sit in his living room looking at all that aluminum foil.

FROKE: You were talking about the difficulty of getting early financing to get a cable system operating, to cover the expenses of operations of cable. And that pattern that obviously was a national pattern because the business was new, and the financial institutions across the country had that same problem of really not understanding what was the equity of the subscriber fee that came in on a regular basis. In the earlier oral histories that I've done, I've run across two different stories. One is that Paul Kagen, who came out of a brokerage firm in New York and then became a principal writer in the cable business and also then going on to do his research reports, that he also was instrumental in getting the financial institutions to appreciate what cable could do. And then Bill Daniels ...

JONES: ... More than anybody else – Paul was.

FROKE: Bill Daniels is also identified as a ...

JONES: ... Well to some extent.

FROKE: What are your recollections of the national picture at that time in terms of getting a turn-around with the financial institutions? You, undoubtedly, were beginning to associate with the other cable operators across the country.

JONES: Well, I had seen it because I represented a lot of the cable companies as a lawyer and dealt with those loan instruments and all that.

FROKE: So you were working with them and talking with them also about the necessity of converting the financial institutions to your point of view.

JONES: Right. And Paul, clearly you'd have to say, was instrument in all that. He supplied the analytical support. He understood that business, and he supplied the analytical basis upon which the banks and insurance companies felt secure....

FROKE: ... You could communicate with the banks though?

JONES: ... He spoke their language. Bill was helpful, to some extent in that regard too, because he was a broker. He was one of the ... although Marty Malarkey was in the brokerage business when ...

FROKE: ... Yes, yes.

JONES: ... because both Bill and I sort of showed up after the Korean War because we were both in the Navy. All this business had really already gotten started. It was quite a ways along in terms of being a business and an industry before the Korean War was over. But he was a deal guy. He could put together deals.

FROKE: You had mentioned in the earlier session with you that he was a dynamic salesperson.

JONES: He was.

FROKE: He had a personality that drove ...

JONES: Right. That drove ... he was a very magnetic sort of guy. We had a lot of fun together in the earlier days. So he had to buy and sell cable systems and to do that you had to get financing.

FROKE: Yup, yup. He was coming at it another way.

JONES: Yes. The mother of necessity was speaking to him, and he resolved it by getting insurance companies and others involved. But clearly, you'd have to say that Paul was the guru that everybody turned to - and to some extent Marty Malarkey as well. People had great faith in Marty and his integrity in terms of numbers, consulting, advice and things like that.

FROKE: And it covered the whole business community, not just the cable business? In other words he could walk across several different business paths.

JONES: Who are you talking about, Paul?

FROKE: No, Marty Malarkey.

JONES: Yes, Marty, you know, was very talented guy, and he was a very believable guy. He was ... I know Bill used to call him ...he was the guy you'd go to to get it done already. He was a very sage man.

FROKE: In a sense, you became an MSO with the acquisition of Idaho Springs.

JONES: Right, that's true.

FROKE: And you were talking in our earlier session about the strategy that you used to acquire then, some of the next cable systems that became a part of your operation. You would fly over a geographic area, and you'd be looking, then, for population base for the headend location of an existing system and then looking at what the possibilities were for reaching population areas off that headend.

JONES: Yes, right. I mean, I had topographical maps that ...you knew where the tower was and how high it was and what the distance was and how high the hills or mountains were around the site that you were looking at. Georgetown was ideal because it was in a crevasse actually. You don't even get good radio in Georgetown without some kind of ...

FROKE: And you were looking for expansion capability for a particular system.

JONES: Right. The day I bought ... five minutes after I acquired Georgetown ... it was a snowy day. It was a very blustery and windy, winter day in Georgetown, Colorado. When that happens there it's like being in a different, special world. It's like the rest of the world doesn't exist, only Georgetown. I remember yodeling in my Volkswagen going down – because I was now in the cable business – going down to the Alpine Inn to my table to have a cup of coffee. And I had Mel's little book that showed his 100 subscribers and how none of them had been paying him. So I had a yellow pad and my pen, ballpoint pen, and I was calculating how much it would cost to build the rest of America. I calculated that it would take something over $10 billion. Then I started thinking, well how do you become a player, with 100 subscribers that aren't paying anything, in that kind of a marketplace. So I started thinking in terms of how I would get the good parts one place and the bad parts in another place. Because the cable systems, in the first couple years to a bank, were disastrous. If you look at their balance sheets, they just weren't making any money. They had all this debt. They had this plant that you had to roll up and store some place ... you know, that's what I was saying before. It wasn't five - it took five years to sort of get out of that so that you could get some kind of loan at a bank. So you had to ... I was figuring on some way to separate the two so that the depreciation and amortization and the losses were one place, and I could put earnings some place else. So that's how I devised Jones Intercable so that it would be a management company and would be the general partner, that I would have limited partners. I would have all the tax stuff and all the bad stuff over in the limited partnership, and I would get a net fee for managing it so I could show earnings, even though the operation was just like any other cable operation was showing – huge losses for a long time. But the limited partners could write those losses off so it was an advantage to them and therefore drive an investment in to this structure. So I checked that out with - the concept – with Carol Rice who was Rice and Enright (Don Enright lives up in Boulder. You should interview him. He could tell you some fascinating things about how we financed things in those days.). I checked with Don Enright to see if this would work from an accounting standpoint. Carol said, "Yes, it ought to work." I started wringing out with a law firm - although I thought it would work, I was a lawyer - to see if they thought it would work. They basically didn't think it could work. It was too awkward. But then I noticed that ... and my brother, who later came with me and it was a very important part of building the company, was working with an oil company that was thinking about doing a limited partnership concept, a public limited partnership concept. So I got those documents and analyzed those. I just thought it would work much better in cable than oil because you had some hard, physical asset that you were working with. It wasn't so much conjecture, and you could predict easier. At any rate, about that time I decided I needed to know a lot more about financial statements than I knew to build a company. So I started thinking about going to Stanford Executive Program ... and I just started .....Well, first I put together a couple private, limited partnerships and put Georgetown and Empire in two private, old partnerships to sort of see how you would sell this and what the concept was and sort of get them working. I felt that this would work. But what I needed to do was a public offering. But I needed $150,000 at least, cost you more now, to do a public offering. So I said, "Well, I'll take Jones Intercable public." But the reggae. They just raised the limit to $500,000 from $300,000. In that process I decided if I'm going to get into sort of the big-time financial world with all this, I need to get a little help here because I was feeling inadequate. I couldn't do everything myself. So I decided maybe I should go to Stanford Executive Program. I applied and was accepted, but I was going to go, but then it cost $10,000 which was a lot of money for me. I didn't know whether I had the time because it was three months long. So at the very last minute I decided to go. The fellow that was running the program, Dr. Alexander Robicheck, became a good friend and later came on my board. He was, I think, wanting a rock 'n roll entrepreneur in the class or something like that. But he was good enough and gracious enough to say, "Okay." So I went there and lived in the girls' dorm, basically took the company public from the girls' dorm at Stanford while going to Stanford Executive Program which turned out to be a lot harder than I thought it was going to be. When I got out of Stanford Executive Program my company was public, and we raised $380,000 which was enough to do a public deal. So I put together a document to go public and filed it, an S1.

FROKE: The Security Administration approved it?

JONES: Uh-huh. It had a terrible time – at SCC. In doing this, in term, and Dreyfuss wanted to ... had decided that cable was where it was at, cable was the future. They were panicked to get into the cable business. They had somehow hired this vice president who was in charge of searching out who could take them into cable business. This guy was incredible. I would be at a restaurant in California and the phone would ring. This guy was amazing. It would be this guy. "Glenn, you've got to come to New York and talk to us about cable." I didn't want to go to New York. So finally one day he called, and I was in a restaurant in ... I was in Denny's or someplace in California having my evening meal. It's a lot later in New York. This guy – it's 2:00 in the morning where he was. So I said, "Okay, okay. I'll come to New York." I went to New York and on the way back on the plane I had a yellow pad so I drew what we could do with limited partnerships and a series of limited partnerships. I remember that because the airlines lost my luggage. Anyway, I arrived and they put my up at the presidential suite at the Plaza Hotel – Howard Hughes had just moved out or something like that. I was lonely and there were chandeliers all over ... and they were right across the street in the GM Building, up high. They sort of kept the blinders on me. I went over there the next day with my yellow pad and they said - the president, who is Jerry somebody, I forget, a real lovely guy – asked me if I had developed a business plan. I said, "Oh, yes, I did." So I just went in my briefcase and pulled out this yellow pad which sort of startled everybody. It was kind of crude for what they were used to evidently. They had it Xeroxed and passed it around, and we chatted for awhile. Then the CEO came in and sat and listened for awhile and said, "At last we have somebody that knows what they're doing. Mr. Jones, would you stay for dinner?" I said, "Sure." So we had dinner that night, and I remember the lawyers were there and the accountants – they didn't have just one, they had .... They kept saying you can't ... this is not doable. You can't do this. You can't do partnerships. It's impossible. Finally one of the board members ... many members of the board were there ... finally spoke up and said, "You don't understand. He's doing it." So we were going to do a series of ... I remember going to dinner like ask a lot of questions and then after asking all these questions, sort of sat there by myself. I finally, sort of at the end of the dinner, I said, "Look, you've been asking me a lot of questions, and I've been answering them. It's been a nice discourse and everything, but if you want to be in the cable business so that you can have a successful deal when you sell in two years, I'm just not interested in talking to you. But if you want to build another Union Pacific Railroad, we can talk." So they decided they wanted to build another Union ... At any rate we were going to do a consecutive series of $25 million deals, and they had their shtick and the power to sell these partnerships which I was finding difficult because I'm a terrible salesman. And I wasn't finding anybody that was willing to sell my partnerships even if I did have them registered. I couldn't find anybody that would sell them. We negotiated for a long time, went back and forth. Just to shorten that story up, I decided I didn't really want to do that. So that left me with trying to sell partnerships myself, which I found I really couldn't do. I had a friend who was a dentist. And this guy was a friend. I took my slide projector and went to his kitchen with he and his wife. I talked to them for 4 hours for $1000 investment in cable TV Fund 3, I think it was, because the first two were private deals. And I couldn't sell them. And they were friends. And I was talking about gigahertz and megahertz ... it's not the way to sell. So I finally decided, well, I can't get anybody else to sell it, I'd better form a securities company. So I went down, I took the principal's exam. I studied and took the securities principal exam and formed a securities company called Jones ... it was called Ensign Securities because it was like a newly minted securities company. I figured it was an appropriate name. I later changed it to Jones International Securities. So I had instant securities. Then I tried to put together a selling group with Ensign Securities and tried to get people to sell it for me - as a group. And I was a securities company. And I could maybe hire somebody in instant securities to sort of wholesale it to retailers, other NSD companies that would then retail to their base of investors. So I found one. I remember I was invited to .... I just couldn't find anybody that would sign up with me, I mean because I would tell them about the cable business which they didn't know too much about in the first place. Then when I talked to them about limited partnerships, their eyes just glazed over, they'd roll over and I'd just see white in the pupils. It was just too complicated for everybody. So I was invited to ... if you bought breakfast, there was a group in Colorado, I forget what the name of it was, but they were securities sales people, sort of low-end securities sales people, not the Bashes and people like that, but the little companies, little NSD companies that were selling tax things. Some of them were good, and some of them weren't too good. I bought breakfast at Uncle John's Pancake House and for buying breakfast, you got to speak about your product in front of these guys so I told them about my cable limited partnerships. After breakfast these three guys hung back and – they had lost their product because of something, something bad happening to the general partner or the trust that they were selling for and so forth. So they were interested because they had nothing to sell at the time. I convinced them to sell my partnerships. So now I had a company that was in my selling group to help me sell. And they were terrific ones – A. G. Horiushi was a Japanese guy and there was a bookkeeper, a meticulous guy, and a guy that was sort of flamboyant, big, tall guy, terrific guy – Irv Blake.

FROKE: And they had contacts in other parts of the country, too?

JONES: No, no, in other parts of Colorado.

FROKE: O.K. All right. You hadn't got that far.

JONES: Right. So I used to go with them on sales calls, and I was learning a little bit. I was a slow learner. I knew I was not going to able to do this in the magnitude, personally, that it was going to take. In any event, I just kept signing up little companies in this selling group, and we ended up with about 250 NSD company wire houses, including Bashe, Shearson and the large companies at the end of the day. But we raised about $135,000 in that fund. So I closed it down, and I went down and I bought Atala, Alabama. Interesting story there, but anyway I bought the system and that was - and we put that into the fund - that turned out well. I quickly filed another registration so now I had the three systems, and I had Atala, Alabama. Then I quickly filed Fund 4 and raised $425,000. By now I'd had more in the selling group and had that pitch down and were getting organized. We raised, I think $425,000 and bought a system outside of St. Louis, name escapes me right now. But at any rate, we ... it was being managed by Daniels - it had failed. It was an Anaconda system, and I bought it from Anaconda over the telephone, basically. I went down and looked at it. I had all this data on systems, and I looked at it and said, "Well, this should be ... it was in front of a lot of homes – had zippo subscribers – was a top market, was getting a lot of stuff off the air, but still should be doing better than it was. It was being managed by Daniels. So I called and talked to the vice president of Anaconda, and they were trying to get rid of all the stuff because they were merging with somebody and this was a wart that needed to get rid of to clean up their balance sheet and they needed to talk about it. They had two systems. I said ... he sold it to me for $125,000. I bought it over the telephone, basically. After I bought it, other people really tried to get in between the deal and wreck it and get in the middle of it. And Bill and I competing here but I ended up.... But this guy was really good for his word. In fact, I took my son back to the closing so he could sit there because I wanted to show him how American business really worked with good people. He was 14 years old at the time. But they were just solid people and we closed that deal. They had a system out in Mountain Home, Idaho so I bought that over the phone too. The same sort of thing happened there – good for their word. We shook hands on the deal mentally.

FROKE: Each one gave you additional experience and the process became more refined?

JONES: Right. So now I'm really growing and closed that Fund 4 and Fund 5 and everybody ... it was pretty un-American to be doing this.

FROKE: Why do you say that?

JONES: Well, that's ... some of the securities companies just thought this was a terrible way to raise money.

FROKE: It was in the perception ...

JONES: The large cable operators would give it faint praise because we were, after all, friends. ...

FROKE: It was the perception that some people had.

JONES: Our cattle were grazing on their grass. It was that kind of an attitude. But we plowed our way through all that. Then I figured, because we're not getting a lot of support from the industry, that that's not who I wanted to deal with anyway. I was really dealing with the financial community. So I designed everything for the financial community and by-passed the industry, basically, because I knew if I had the money they could like me or not like me. I was going to buy the systems anyway. So we did that. When we started raising ... when one of the funds, I forget which one it is, six or seven, something like that, ... we raised $50 million. Well then all of a sudden Bill and others thought this might be a good way to raise money. So they jumped in. But by that time ... when they went to Wall Street to talk to securities companies ... while they were big in the cable industry, nobody on the street knew who they were particularly. They would say, "Oh, a Jones deal." I know that.

FROKE: So you were widely known by that time, yes?

JONES: In the financial ... on the street, you know. But that's ... you know, solve the financial problem and you don't have any problems. That's the only problem you had to solve in this business at that time. We got to the point where we had some followers trying to catch up but nobody ever laid a glove on us. We were just too far ahead of everybody. We ended up raising over $1 billion in equity. When we were cranking along, we were raising about $200 million a year. It got so we had 1,000s of people. We trained 1,000s of ... brokers would bring them into this building and train them 100 at a time, Bashes top brokers and Dean Whittier. And then they would go back and radiate and sell our products. We had this incredible incentive trips to Paris or wherever for these guys – we really had them going. For a variety of reasons, that business ... real estate and oil deals crashed, a lot of them, especially when the large companies, large securities companies, thought they could do it because they could raise the money. They thought they could run these things. It happened in cable too and, of course, they couldn't. They would come to us and say, without mentioning names, ... I remember one of them came to us and said, "Look, we'll sell your stuff, but you've got to make it look 'we've got a better design.'" And I had computer runs stacked that high that I knew exactly what worked and what didn't work in cable business. And these guys wanted to design it like a real estate business because they could sell better. But then they'd have a constant revenue stream and all this stuff was great or it'd be .... One of them said, "Look, we want it to look like our Wheat Heart deal, ..." which was a cattle deal - it was called a Wheat Heart, "...and it will sell your stuff." But cable wouldn't work with the Wheat Heart structure. So we just refused to do it, which paid off in the end because our deals worked out and the other ones didn't.

FROKE: You stayed with your design?

JONES: Well, I knew what worked. I knew the sweet spot.

FROKE: How did you match up a purchase of a cable system with the fund that had been publicly supported?

JONES: Well, I had to form my own brokerage company because, you know, as great as Bill was and everything and the other brokerage companies, we would get second bites of the apple. At that time he had a little cable operation himself, and maybe they would get first bite and we'd get second bite. So I had to assure that we got first bite at apples so we cranked up our own ...

FROKE: And the amount of the fund would determine what cable system you would put into the fund?

JONES: Acquire, right.

FROKE: Did you put more than one system into ...

JONES: Yes, right. We put several in. Then we started doing serial funds. We'd do, like register $200 million or something like that.

FROKE: You mentioned $1 billion as being the total equity ...

JONES: ... Yes, it was actually $1.3 billion but that was ... we raised some money for ...

FROKE: ... How many funds were involved then, how many separate funds?

JONES: Well, I forget how many. But Paul Kagan and I had a race ...

FROKE: 100, 150?

JONES: No, no, not that many. Paul has a lot of newsletters. So we had a race going on that I could create more partnerships than he could newsletters. And I still owe him dinner. It was a joke we had going on for years. I'd be ahead, and he'd be ..... But, you know, as new things like MMDS and LMDS and things come out, he'd form a newsletter with that technology, and I'd form a new fund. So we had a lot of fun with that over the years.

FROKE: You've always been the intellectual in terms of scholarship, looking for informational resources. Al Warren, I know, was a principal source of information for you too. In other words, you didn't necessarily have to have the first-hand experience yourself. You could go out and gather information and make extrapolations from that like any scholar would.

JONES: Well, we did a lot of extrapolating. We did a lot of prediction. I shouldn't say this, but it was 20 years ago, I gave a speech about convergence, how this stuff was going to come together to – it might not be exactly 20 years ago, it was a long time, in Bermuda, to Robinson Humphrey brokers who were a very classy brokerage house in our selling group. They had their key managers and sales people in Bermuda, and I was invited down to keynote and talk about our product. Anyway, just for drill, I pulled that speech out and gave it last year and everybody thought it was terrific. So all that stuff did come to pass actually.

FROKE: I ran across something similar, not your paper, but Hub Schlafly's paper related to satellite communications that he had delivered quite some time ago.

JONES: It was exactly predictable but you could see that stuff working and you could dead reckon it, you know. You could say it's probably going to go here and if it goes there, this is going to happen, this happen, that's going to happen. Then when computers started to become a factor, that really roused my curiosity. You could see all that stuff coming together, and you just wondered why we didn't have the substance to make the Silicon Valley, talk to the cable industry and Wall Street and get everybody in the same room and so forth. Even when we created things, like we were talking earlier, ___ encryption, deep encryption and compression – couldn't get anybody interested in it, in any serious stuff.

FROKE: So you were a cable operator. You were a broker. You were a financier. In addition to that, then, you had some of your own ideas as to what a cable system could do in a community and had some high quality operational standards for all of your systems. When you go through the literature or glance through the newspapers, you never run across a Jones system – or I've never run across a Jones system - that was under attack by its customers. What were some of the things, then, that you did to have that astounding record in a field that was damned so severely by regulators and legislators for customer service short-comings?

JONES: Well, we were pretty aggressive about rebuilds and getting things working right. And we were also pretty aggressive in terms of what the system needed to look like. A lot of systems in those days where -–you'd go to the office and it would be a converted gas station. You can do what you want to a converted gas station but it always looks like a converted gas station. It made sense. You'd drive through, you'd pay. We, early on, sort of developed a concept. We used to devise interesting management systems and motivational systems and compensations systems, and they proved very helpful. One of the aspects of it was that people had to have a good place, a decent place to work. So we would just tear down and build new buildings. They would be sharp and they would look like the cable television industry should look like if there was going to be a futuristic entity in town - things like that. We were very careful with ...

FROKE: It looked like an organization with stature.

JONES: Well, we were careful with graphics and logos and slogans and things like that so we did a lot of that. Then we raised $1 billion and we borrowed $1 billion on top of that. Then as we acquired systems ourselves, we used more leverage. Early on we got into education as well, because you could just feel the power of a cable system in a community and what it could really do there if you had the right attitude. In our organization we call everybody associates – it's not that that's unique but we did that early on. We never called anybody employee. From the very beginning they were associates. We had sort of a code and the idea was that if everybody understood where the north star was, they'd get there – almost like collusion. You didn't have to have a lot of meetings if they had a very clear vision of where it was that you were going. So we developed this concept of participatory self-management, which is that you need to manage the assets around you. But at the same time, you need to constantly talk to your people who are reporting to you and the people to whom you're reporting.

FROKE: So you had this, so-called, what's now called team approach – you did that early then.

JONES: Yes. This concept was very compelling because I had the same response. Our organization chart is designed in groups of rockets. Each company is a rocket heading for the knowledge culture. Ten years ago I called it the information culture, but then we changed it. The knowledge culture was described – it had a bunch of rings going around like electron – it would describe what each one of these rings were, how you could know that you were in the information culture or the knowledge culture, or what was out there, so where you were headed and what you needed to plan for. Then the companies were grouped in funds because that's the way we raised our money, in partnerships. Then we would have, included in that group, were the other companies, like support companies because you needed things like buildings so you needed companies. You had to have a finance group to raise our own financing and a brokerage company to buy and sell cable systems, brokerage company to sell securities. So we had those all clumped into categories – flights of rocket ships headed horizontally to the information/knowledge culture. The process through which that happened, the path of flight, was something we called mind extension because we thought we were, instead of extending the human body like people were doing in the industrial revolution, we were extending the human mind in the next century. We were in the business of extending the human mind, and we thought we could have a dramatic impact in the extension of the human mind which got us into education and other things. Really the business we were in was in the mind extension business. We were never in the cable business. We were in the mind extension business so we were in a different business than everybody else basically.

FROKE: Okay. Okay.

JONES: Then we had a lot of ... this participatory self-management was part of the concept of being in the mind extension business. As everybody had the obligation to explain what they were doing to their people that were reporting to them and to the people they were reporting to, I likewise had .... So every year, and we still do that here, we rent a hall or a theater and have everybody come there. It's my responsibility to tell them what's going on in the holding company so that everybody understands what's happening. That's my responsibility – I have to do that. It works from bottom, from janitor to CEO. Then we have this concept of what we call IQ, imagination in quality, because if you think quality, you're going to have quality. Imagination is as big an asset as real estate or engineering. You're cajoled to be imaginative in managing these assets. And you have to have quality. So we have a lot of these attributes. One of them also is attack. Attack, always attack, so extremely aggressive. If you attack in pursuit of a business objective and make a mistake, that's okay Everybody expects that. So you get a reward and patted on the back and have a little rest and get back in the frame. It's special if you make a mistake being aggressive and attacking in the marketplace. As a consequence, we've made a few mistakes. But that's okay because you do more damage by hanging back and having analysis paralysis than attacking. Our logo is a dragon. That's sort of an internal logo. Everybody had these little dragons on their telephone with "Attack, Attack, Always Attack" on their telephones. It develops an attitude. So, yes, we are a very aggressive company. Then we have some other things so....

FROKE: In effect, you're organizational structure with a social institution really.

JONES: It was very tight and social. But we could turn fast and attack.

FROKE: Let me then raise a point that relates to a visit that I made at your corporate headquarters, maybe 8 – 10 years ago. You had your war room. Using telecommunications, then, you had applied it then, for organization and administration of your different operating systems across the country. And periodically then, they would, once a week or whatever the time period was, they would work with you personally. So in a sense then, you were using telecommunications to extend the social institution to the local operating systems.

JONES: Yes, we used it. We formed a group called Integrated Thinking Group. We had regular meetings. These were the hot people in the organization, young, hot people. They've gone out and become big successes in other companies at this point. They were taught to think of the business that we're in like layers of chess boards – roll in an equipment rack, but in the rack instead of amplifiers and modulators and things like that, think of a chess board in each one of them. So you had multiple chess boards. And I'd tell them what the chess boards were – they'd be the satellite wars, financing, operations, and all kinds of things that were going on, securities. They were taught that when you move this piece, it changes all the pieces. So you have to think like that. So that was very helpful. Then we had an intangible thinking group, intangible leveraging group. That was because if you look the price of chips and the price of human talent, you can see that you need to move the chips away from human talent to the extent that you can, for pricing. You need to leverage your human talent so that to avoid bringing a lot of people of board and having a lot of people around, this intangible leveraging was that if you had a problem, like if you had a marketing problem, what you should is go to the local B-school or some B-school and hire the marketing professor and 20 of his students for $10 an hour. They got into the real world, and you got a lot of fresh thinking on this special problem you had. When they were through, they were through. That's an example of intangible leveraging.

FROKE: Those Harvard Classics did you pretty good.

JONES: Pardon.

FROKE: Those Harvard Classics did you pretty good.

JONES: I don't know about that, but these things were strange, but they really worked for us.

FROKE: You obviously have become a student of philosophy, psychology.

JONES: I was going to hire a vice president of philosophy at one time, and my peers talked me out of it.

FROKE: When I visited 8 – 10 years ago, one of your colleagues also showed me your bathroom. You have your apartment here in your corporate headquarters. You mentioned the computers awhile back. But you were into computers early, and you were, even during bath hours, retrieving data to analyze what was happening in your area systems across the country.

JONES: I got a lot of help from science fiction books. The Dune trilogy sort of became a bible. So the building here is designed around concepts we got from the Dune trilogy on the planet of Arrakis which was an outpost of the empire. It was a place where people lived, yet it was a fort. This building was built to replicate some of those concepts. It was built as a very livable building but a place where people could come and strap into the latest technology and fight. In my areas, like the bridge, the flag bridge of a cruiser, of a heavy cruiser so that I have an office, and then I have my war room and I'll come back to that. Then I have a library with a Murphy bed that I can fold down so if the action gets heavy, I can stay for days. Then we have a commercial galley and the board room which is sort of the ward room – it's our deal room. And that's all interconnected. Then we have a presentation room on the 1st floor that's interconnected with my war room which is also interconnected with the board room which can interconnect to the outside world by satellite if we wanted to so that we could function. The war room we put together to ... we have 16 televisions screens in there, but they're actually CRTs. They turn into CRTs. They're either CRTs or television sets depending on how I want to use them. I was having a hard time getting the right kind of feel in there, the right kind of design. So I had to go to Hollywood and get the guys that helped out with Star Wars artifacts to help me out with it so that it was the right feel in there. It has an observation deck and then a module of electronics that we can manipulate the earth station out front to lock on to whatever satellite we want to sock down, look at things, look at our competition basically. When it was pretty up and operational, we would send out what we called strike teams to ... if we were in an acquisition mode in the brokerage company and they can buy and sell cable systems in the Jones Group. So we would send the strike teams out. These guys all had day jobs but they were cross-trained. They could be an engineer, maybe a manager of a system, a marketing guy, depending on what we thought we were going to run into out there. We'd do this with or without permission sometimes. We had some embarrassing experiences. But these guys were very aggressive and they would go out and ... we had a pamphlet, and you filled out this pamphlet with all the assumptions. Then we come back and we'd load them into the computer and it would switch the TV into CRT screens, and we had an observation deck in the war room. We'd tear the thing apart. If it was a company with multiple systems, we'd have about five ways we could buy them. We could buy them. We had three funds with capital to expand, and then we had our company, and then we had Space Inc. which is another story. We could tear them down and put them together again in 20 minutes once we got the assumptions filled up and reorganize them. Then we could figure out exactly what we could afford to pay for these things. It worked really great. Then also, we had these 250 wire houses that had to do due diligence with, and they were always coming out and lifting up the tree to see if the roots were still there. We had to learn to live with all that, but I was trying to get them to do it electronically. I could just dump the due diligence into New York and we get our end put together but they never got their end put together that well. We had 1.5 million subscribers on line so I could come in at 2:00 in the morning when I landed and come over and pull down my Murphy bed, go into the war room, and I could go into Albuquerque cable system. The software would... I could say what's our cash flow this month compared to budget and it had a dummy kind of software so I could read it.

FROKE: Though technology, and this an exaggeration, but through technology you almost were capable of being an on-site manager operating out of Denver.

JONES: Then we flattened the organization. That's pretty much ... we had really flat ... we had two layers. There was me, a layer of vice presidents, and bang – right down to the systems.

FROKE: One of the other things that I noticed on that first visit, and I'd not seen it anyplace else at that particular time, was the amount of effort that you had devoted to creating social areas, I'll call them, within the building – cafeterias, eating places, and the like. My first impression was that you did it primarily because you built in an area that was not well-developed at that particular time. It was not easy to get to a restaurant. But since then, I've come to believe that you really built them because you saw those as an opportunity for people to get together and talk and visit and capitalize on what is basically a social time.

JONES: Right. And it was designed, again, from the Dune Trilogy. That's why there's a water feature. In Arrakis, water was very important. So we have a water feature. Even our flag is black and green, the Atreides family colors, the dragon flag.

FROKE: I remember on your first visit to State College, Pennsylvania, where I was working at the time, your private plane was also black. But I did not make the connection at that time.

JONES: Right. It's all consistent.

FROKE: You should have told me.

JONES: In fact, Intercable was basically a 30 year business plan that just ran full circle, that played itself out. The only thing that didn't work right was the stock price. It has recently, but it didn't along the way so I didn't have the currency of stock to acquire like I thought it would have. But everything else worked just right.

FROKE: Did you concentrate your acquisition of cable systems in the southeast, for example. I know you have major holdings in Virginia and some of the show places of cable operating systems really are your systems in Virginia. Did you have geographical concentrations in your early plans?

JONES: We built - we tried to acquire cable systems in the outskirts of major cities and avoid major cities per se. We don't want to get involved in the politics of Chicago but we own the growth ring around Chicago. We didn't want Washington, DC per se, but Washington, DC, in my judgment is one of the best markets in the world because you're thinking about information ...

FROKE: ... Suburban?

JONES: ... economy and knowledge economy and analyze what Washington is, it's the information storehouse of the world. All that has to move in and out, and so that was my primary market. We tried to dominate Washington. We were interested ... because that's where the growth is and the politics is much better and it's split up so you're not at the mercy of one government, you know, one governmental body. The demographics are better, the growth is better, everything's better in the outskirts.

FROKE: In the technology that later developed also played into that kind of strategy?

JONES: It did. So we had the outskirts of Chicago, outskirts of Washington, DC, some outskirts of LA. The only cities that we got involved with were great markets but not like Chicago – for instance Albuquerque, we had the outskirts of Tucson.

FROKE: You mentioned 1.5 million subscribers. Was that the peak of your growth?

JONES: Well, we peaked a little bit higher than that. Each one of them were on-line in my war room. You could look at individual bills if you wanted to go to that detail. But I could do things at 2:00 in the morning and ask my vice presidents in the morning about ... and get answers. So it was a good way for me to operate. We were really fortunate in getting Jim O'Brien, Carl Vogel and Ruth Warren, and just terrific people that bought into all this and helped build it. I used to spend 25% of my time interviewing new hires.

FROKE: What would explain the lack of, I don't know what you would call it, assimilation of your organizational genius, into other cable systems, into other cable operations? It would seem to be a natural. But they stayed with old organizational concepts for ... certainly there was a change in administration from the mom, the pa type of operations, but the patterns of organization of other businesses seem to be what fell in place. You came up with new models.

JONES: Well, as I said, we were in the mind extension business, not the cable business. We were in a different business. I have to tell you, in the early days it was rugged for us in the cable business because we really didn't get a lot of help. There was a lot of competition, and you had to do things new ways because if you did them the old ways, you were running behind everybody - you're living in a world of exhaust fumes. You had to get up out of the trench and sort of develop new ways to do things.

FROKE: Going back briefly to Georgetown and Idaho Springs for a short time here. If I understand correctly, you really had your concepts of limited partnerships as a financing model very, very early then.

JONES: Yes, we created the public limited partnership model.

FROKE: That did not come later but it came really when you were first making your entry into the cable business.

JONES: Well, I had to find a way to raise capital that worked for the business I was in and for the securities market that I was addressing.

FROKE: Did I understand you correctly that none of your Jones limited partnerships failed? In other words, the investors got out of what they put in?

JONES: We had a lot of partnerships. I'd have to .... But they all did pretty well, some of them did fabulously well. Some were worse than others. Some were better than others.

FROKE: But nothing like the debacles in oil.

JONES: Oh, no. No. Because we knew where the sweet spot was and ...

FROKE: You knew where they were ...

JONES: ... we had computer runs

FROKE: ... what they were doing.

JONES: You know, when computers were making clacking noises .... We had a brush with venture capitalists that we got involved with that tried to take over the company. I remember that. That was harrowing and ugly, but we muscled our way through that too. The pert chart became a way of life for a long time because you had to know exactly where you were and exactly where you wanted to go and exactly what you didn't have and where the critical paths were. It saved our bacon a lot of times because you could ...

FROKE: ... Was your 3-month session at Stanford University in the Executive Management Program a critical phase in your ...

JONES: ... It was. It really was, a huge success for me personally. As I said, it was interesting, most of the people there were executive vice presidents of big chemical companies in Switzerland or something that were going to be president when they returned. They didn't have a lot of entrepreneurs per se in there, a few of them, but not many.

FROKE: But your lab project, in a sense, was the development of the limited partnership model while you were out at Stanford.

JONES: Well, no, I had that developed before I went.

FROKE: Oh, before you went, okay

JONES: Basically developed that in Georgetown.

FROKE: Did you ever get to know well Donald Jones.

JONES: Sure.

FROKE: Up in Fond du Lac, Wisconsin.

JONES: Right. Very well. Don and I are great friends.

FROKE: You had an affinity with Don?

JONES: Well, I got to know him later. I didn't know him in the early days. The way we sort of looked at the business in the early days was we were living in a fort here and attacking the rest of the world that was attacking us. Everybody was a Cylon warrior to us.

FROKE: Don is not active in cable now but he does have a web site that's called Spirit Enterprises.

JONES: Yes. We worked together at the Library of Congress. We were both founders of the Madison Council at the Library of Congress. I didn't have a library for my cyber students so I thought I'd go to the Library of Congress and see if they would be my library. Don was helpful in that regard.

FROKE: In the different major incidents in the life of the cable industry as a whole, there have been various business initiatives by competitors, so to speak. The telephone people came in in a wild swirl not too many years ago really. And you joined that. What prompted you to go with Bell Canada?

JONES: Actually, before that, we did the first telephone company deal in the UK and that's how we sort of got into telephone companies. I had acquired a study. It was a Rand study or something. I forget who did it, but it was on how to take over a telephone company. And it was a bizarre thought at the time. I remember it was on my desk and somebody, some investment bankers came in and looked at it and they laughed out loud. But I always thought it was a possibility. If the stars just lined up just right and you had the right kind of financing, you could take a shot. I never understood why they didn't ... in the early days we tried to sell them cable systems and things like that, but they ... told them you had the trucks, you have the telephone poles.... Did the same thing to power companies but they just wouldn't listen. They actually developed cable. They invented coaxial cable ...

FROKE: ... In Canada

JONES: ... for their own strategic purposes chose not to deploy it. In any event they were great sources of capital. In the UK, we got involved early on in the Docklands area building the Docklands area. I always wanted to be in global business and so that seemed like a good place for us to start. So I went over there and got involved in the Docklands area. We got involved so we invested and became an advisor, but they would do nothing that we advised them to do. They just did it their own way – crazy things that we'd already done and didn't work here – just couldn't get them to do it right. So we declined in the second round of financing, waiting for it to hit the wall – which it did. The bank took over. So we went to PacTel to see if they might ... we had reason to believe that they might be interested in going abroad. So we talked to them about doing ... it just really took forever. Finally one day we said, "Look, this deal's going to go down this Friday or it's all over." The week before I cleaned out the banks. I bought the bank's position so we were the sole player ... because so much time dealing with the telephone company. So that Friday night, I guess it was actually Saturday morning about 3:00, the deal closed and it was the first telephone company deal in the UK. Then, for their own strategic reasons - I designed all the documents to protect us in case – because they were the big heavy with the cap and everything – to protect us in case we had to come up with more capital. But I never dreamed that they would drop out. But they dropped out. Then we had to hustle around and find another telephone company. So we found Bell Canada and got them involved. And that relationship was pretty good. We got the franchises in Leads, and we were building Leads ourselves then. Bell Canada was over there in that deal. And we were building in Leads and Watford and some other places over in the UK. I had a good operation cooking over there. I was going to take it public, and I formed a ... I had closed down a domestic partnership business because it didn't work, and I found out that you could not raise money in foreign countries to invest in partnerships in the United States because the FCC had everything so screwed up at that time. It was not a good place to put money. So we were forced to go off-shore, basically. But I found out that I could raise money here to invest in England. So I cranked up, and we started a global fund. They'd start out slow, and they'd build momentum. In this particular fund, we were starting to raise $20 million a month. But then I decided to merge everything with Bell Canada and have a bigger company because Telewest and another company had tried to go public and hadn't made it. So I figured if they didn't make it, I'm going to have a hard time making it by myself. So wee went together with Bell Canada and filed on a confidential basis because we figured that the other companies had already trained the institutions to like ... our readings were that they really liked UK cable but they weren't quite ready ... but we thought well, maybe they're ready now. So then we surfaced with it and blew out a public offering and it was very successful. Then the other two came along and did the same thing, behind us. But that got me out of operations. I was on the executive committee and everything there, but we didn't have any Jones operations because they had been merged in. We had a couple of Spanish operations by that time that we merged in as well. That's how I got involved with Bell Canada initially. That was a good experience. So we kept talking. At that time ...

FROKE: ... Your first initiative, then, was with your holdings in England.

JONES: The UK, yes. At that time in the United States there were regulations that were imposing and debilitating if you were aligned with a telephone company as a cable company in terms of what you could and couldn't do. But I decided that if I had Bell Canada, it doesn't become an FCC problem, it becomes a treaty problem, becomes an international problem. So I can come at it as a Canadian government sort of thing. It's a whole different ball game. They had great expertise and a lot of capital. By that time, also, I had decided that I wanted to get out of the cable business, in terms of owning systems, eventually. What I really wanted to be in was the content business because you could see the internet coming along, and you could see the generation of chips accelerating and maintaining. I had talked to people at Intel and other ... to see how long that was ...and they were telling me 15 years – they're going to keep generating these chips, or 20 years. If you interpolate the generation of chips for 20 years and the other technology that's in place, fiber and so forth, and we'd built the first fiber system in the country - we did a lot of "firsts" in the cable business - in Augusta we built that cable system. Cable systems could commoditize. If you looked at the philosophy, differentials between if you were a telephone company or if you were a cable company. And although we had gone to great length to posture ourselves as being sort of an entertainment and telecommunications company as opposed to fitting the telephone regs, which were different, over time you could see that that was going to be a struggle when the ISPs wanted on your cable systems, AOL predominately. The place to be for a company like ours with a partner that hadn't figured out what they wanted to do in North America yet and that you couldn't make deals with.... We could have at one time owned a lot of wonderful cable systems, but they didn't want to do it, and they couldn't move fast enough. They were still a telephone company. They just couldn't grasp the meaning of a cable company. At any rate, the deal was that I would keep six channels including anything interactive and multi-media. I'd have the right to launch, at my discretion for 15 years, and then had to be carried in all of Intercable's cable systems. I designed the language to take care of it. I didn't mention internet, but I designed it to include the internet, the internet 2, internet 3, cosmic internet, all that. So it was very broad language which turned out to trap us in the end. We ended up launching some networks. So the deal was I would have the right to do that for 15 years, and they had to carry them. That was the major part of the deal. To me it was like selling a system and owning a system at the same time because I didn't want to own the system anymore, the physical facility. I wanted to own the pathway into the home. That's all I wanted to do because I was going into network content. Education is a network content. So that's what we decided to sell. They were going to be very aggressive too - which they proved not to be – so that I would increase the subscriber base of any network that I wanted to launch. Then it became a struggle to launch anything because of the way the board was structured. It just became an almost incredible situation. They never really understood what they bought and had no comprehension of entrepreneurialism which we had discussed at great length before the deal. Then we had also decided that – when you scanned the 21st century that – one of the things we needed was a billing engine, a billing system, an intelligent management system that would slice and dice everything because we were anticipating the internet and doing all kinds of things on the internet, e-commerce, pay-per-view, all kinds of things, education, paying for classes that we were going to do with these systems. We searched the world for a billing system, an intelligent management system that would do this and couldn't find any. So we were forced to create Jones Cyber Solutions to build an intelligent management system that could be a strategic weapon in this kind of environment. If you can't bill it, you can't do it.

FROKE: Crossing national boundaries and everything?

JONES: Right. So we started Skunk Works. It was in Jones Cyber Solutions and it was a derivation of ... but anyway that became a problem with them, too, although we discussed it beforehand, before we closed the deal that they understood we were going to do that, it was a wonderful thing to do and it's no problem. Well, when we closed the deal, everything became a problem – almost, you know – in short order. So that became a stand-alone subsidiary, and we built that, basically an international.... And it just became a real mess. We couldn't grow. We wanted to buy the outskirts. We had a contract with SBC to buy Montgomery County which then we would have really controlled the Washington market. Then what we couldn't buy, we'd overbuild because we were very aggressive. We had battle maps for all of our markets, but we needed their consent to do it.

FROKE: Bill, Canada had approximately 30% interest as a result of the financing with you?

JONES: Yes, 30%. But certain approval rights where we needed their consent ...

FROKE: ...yes, that's a major ...

JONES: ... and this was one of them. We were able to protect the partners and the partnerships by excluding them. So before anything closed, I wanted to get all my partners out, which we did. Then we just became two warring factions, Bell Canada and us. It was just, such a – it's almost an indescribable process that happened there. We had such wonderful people that ... and there were just a few of them, one or two that created ... that had no idea.

FROKE: In a sense the conflict of cultures was very, very ...

JONES: ... Real conflict of cultures. But it was really deeper than that. Every time the board would vote against something that they wanted, they would threaten to sue. It became ... our board meetings were incredible.

FROKE: At what point did Comcast get involved -they were almost simultaneous - during the termination of your agreement with Bell Canada?

JONES: The coup de grace, not the coup de grace but the sort of straw that broke the camel's back for us was when we could not buy Montgomery County, when SBC was going to carry back that paper. Plus we had money in the bank. We could have written a check. But we needed consent, and we just couldn't get it. We put together three different packages of ways to acquire it, but what they really wanted was all the things that international got – they wanted back because the stock price wasn't where it was in the money for them. They just kept looking at the stock price and not the assets. This is the same stock that was selling for $8 but went to $60. It's now at $50, okay. And they paid $26 or something like that. So they were just totally chagrinned and demanded they would finally do it on their terms. They were obligated put in another $140 million so they wanted to be relieved from that obligation. Launching channels, especially internet channel, which they discovered was important later, became a real problem with them. By that time we had launched the first commercial internet channel in the world - before Roadrunner, before @Home and had about 3,000 high speed and hybrid customers in the Washington, DC market. And we were the first _____ in the United States and had drilled the tunnel underneath the Potomac River connecting Maryland to Virginia. We were really in an attack mode. We were ready to rock 'n roll. We had a huge switch in Alexandria. We were in the telephone ... we were doing telephone, telephony already. We had all this stuff figured out, but we just couldn't move with these guys. We ended up in a lawsuit over whether or not we had the right to launch this internet channel which I called programming - which it is. It's programming. Unfortunately, we decided to, okay, ... and they sued all the directors, they sued everybody. The court was ... ended up being Judge Matsch who's a terrific judge here. He was doing the bombing case, the Oklahoma City bombing case. So this got sort of worked in. We decided – well we'll decide it on the merits of the documents. I didn't even go down to the hearing, to the trial. But it was tried and Judge Matsch, as great as he is, had never been on the internet and didn't really understand this internet stuff, what interactive meant, wasn't into all that. So he didn't really pick up on that language somehow. So we lost that but had good grounds for appeal, so I was going to appeal it. And about that time, I decided we're going to take these guys out. They're just ... you know, ... because we can still rock 'n roll a little bit and get another partner. Paul Allen and others were in the market at that time. So we were negotiating with securities companies, large securities, financial houses to take them out.

JONES: Sort of out of spite, I guess, the CEO of Bell Canada International decided to do a deal with Comcast. He left a couple hundred million dollars on the table perhaps. It cost us a lot of money as well. But it was great for Comcast. So they did a deal around us which they were not allowed to do because our document clearly state that they have to have my consent to do a deal, to sell their interest. So Ralph called me up - I was up at American Academy of Achievement Awards Ceremony in Jackson Hole – and I got a call from Ralph. He was on his airplane. He wanted to have breakfast in the morning. I love Ralph. Ralph's a great friend, been a friend for years. I was delighted. Ralph came and he had a press release that had been prepared, and he wanted me to be part of this press release. By now I had a war chest of about $10 million put together to fight, to do legal battle with Bell Canada and was ready to rock 'n roll. So we had a ... he told me what they'd done. They'd put together this deal – that they would be a lot easier to deal with than the guys at Bell Canada. I spent a ... and it was on a weekend. So I requested permission to have another day before they released this (it was a holiday weekend) before they released this press release - to tell our people what was going on so they wouldn't read it in USA Today and Wall Street Journal. But Bell Canada wouldn't give us even another day. Ralph wanted to, but he just ... you know ... they wouldn't do it. So everybody read it here, and they were crying when I came to work, you know. Thinking the whole thing through and what the end game was, I decided we need to make lemonade out of this. In terms of my people, clearly they were much better off - than going with Bell Canada - with Comcast. I'd great admiration for both Ralph and Brian and Julian Brodsky and all the guys that I know for years, known them for years, wonderful people. I thought well, actually these guys are doing us a favor. They didn't do it in that spirit but ...

FROKE: ... the timing ...

JONES: ... the timing and by now the internet ... I could see very clearly what we needed to do as a company because we're a small, imaginative company. We're rock 'n rolling entrepreneurs - probably would do better where imagination was a factor than where size and commodities and all that was a factor. So I decided to call Ralph and say, "Ralph, let's do it. We'll just work everything out. You and I can decide to do it. There's a lot of warts and everything in this deal, but you and I will work it out." And Ralph said, "Right." It's probably the smoothest acquisition in the history of cable because basically Ralph and I just didn't let anything get in the way with it. Brian was terrific as well, and it's just been a great relationship. It was very smooth. The systems they got were probably a lot better than they even thought they were getting, probably amongst the most advanced that they have and well-operated. In whole, it just turned out to be a magnificent deal for everybody.

FROKE: You do not have any operating systems at all now then.

JONES: No.

FROKE: All of those were part of ...

JONES: ... completely severed. Nothing.

FROKE: So you're out of the business ...

JONES: I left the Executive Committee of the NCTA and the Board of the NCTA, not on the board of Intercable anymore, not an officer, not an advisor, just complete, no ... non-competition clauses, completely free agent.

FROKE: In 1999 you also decided to move your programming channel, Knowledge TV, to Discovery.

JONES: What happened there is, early on, about 11, 12 years ago when I started Mind Extension University - then I called it because the concept was .... I would call it Mind Extension University which was confusing for everybody, but that was okay. I would work with the universities and eventually morph it into its own university. It was already called a university so, you know, just have things built underneath it and become a real university. I would leverage off the course-ware of all the other universities that I was dealing with at that time and become sort of a mother kind of university. What really happened was, at the end of the day, cable is not a good way to do education. Television isn't, in terms of what we were trying to do. It's a good way to communicate, clearly one of the great, spectacular tools of the ages.

FROKE: But informal educational ...

JONES: ... Well, the internet has much more depth of channel. Cable's 24 hours a day and that's it. Then you have to have a VCR to switch. And the reason I've started .... So it became superfluous to my educational efforts except as a driver to my web sites and to Jones International University, but truly superfluous. We sold it. Plus it didn't have enough subscribers to really make it and Comcast ... I talked to Ralph and Brian. They didn't want to really do what it took to go forward with it. So we decided to sell it to Discovery where probably it's best home is ... and partly liquidate Knowledge TV ... but we just sold the right to the analog subscribers. We didn't sell the name or did not sell the library. It'll live again on the internet. But when you think about the internet - the reason I did the deal with Bell Canada, basically - is the way I see the technology unfolding is you can become a cable system company again on the internet by just leasing space and not owning the cables. I would rather do that. Then you can select your markets for this package of - unique package – 21sts century package. I just decided to move all my assets from tangible world to the intangible world.

FROKE: You also retained your radio programming service, right?

JONES: We have three groups of companies basically – the education companies which is e-education software that replicates the universities in cyberspace or allows you to put course-ware in cyberspace, content, and the university and some other companies there. And then we have Jones International Networks. I think I'm going to change the name of it. That is composed of a group of companies where we have relationships with about 4,000 radio stations that we provide. We have 12 formats offering at a modular radio stations – largest country music network in the world. About 450 of those stations are country music. 1,200 of those stations, we supply their programming 24 hours a day. You have no idea it's not coming from Little Rock, Arkansas. If it's Little Rock, Arkansas, it's all coming from Denver. With the internet and fax machines and so forth, we have about 100 disc jockeys operating in these 12 formats. Then we have another 1,200 or so radio stations that we syndicate to part times of the day. Then we have another 700-800 that ... we just bought another company up in Seattle. I'm going to analyze fully what's contained in there. Then we have – are building - a stable of talk-show hosts. We use our ... we bought the largest independent radio rep firm in America. It's in New York. They have offices in New York, Dallas, Chicago, LA and Detroit. We syndicate. We create program. We syndicate. We produce Nashville Nights in Nashville and Neon Nights in Nashville. We rep people like Dennis Prager in LA and a group of other talk-show hosts. We're building that stable. What we do is we get two minutes an hour. We don't charge for the radio programming. Then we take that time, we accumulate it and then Media America sells it to the dot.com world – to Amazon.com and those kind of companies. They're big users. But they're drivers to the internet so were building huge internet sites there, and we have uplink facilities, so those kinds of things in that company. And then we have Cyber Solutions which is a digital tool company. That's basically a Skunk Works which we mentioned earlier, that builds this front-end intelligent management system that sits on the front end of the building entrance.

FROKE: In a sense of the radio that you do, whether it's the talk show or the music formats, they constitute content in the same way that you were talking about content earlier.

JONES: Everything is internet or network content. But network content has cable networks, television networks, radio networks or internet networks, any kind of network. It goes across all those modes. We have the drivers with radio and television networks to drive people to web sites, whether they're educational or other kinds of web sites. Each one of these talk show hosts also has a web site so we accumulate those. We're creating a fairly substantial plural for country life style, one and education web sites over there so we've got a lot of web sites going on there.

FROKE: Chamber music, classical ...?

JONES: No. We have classical music...

FROKE: ... symphonic?

JONES: ... golden oldies.

FROKE: You cover the whole range.

JONES: Yes. Hispanic. We're doing a lot of Hispanic. And we're selling music down in Mexico as well to cable systems.

FROKE: And your music, then, is selected on a segmented market interest basis, so country music goes to ...

JONES: ...Right. And then we were loading up music on a hard disc and sending it to Argentina, but that ... there's a technology distributor over the telephone company so ... but again, all of this largely digital so it's like a big, huge digital jukebox, so we're building that infrastructure to run on the internet too. We're moving all this to the internet.

FROKE: Latino?

JONES: Yes. Everything. And we also have – we're in charge of about 50 channels coming off of DARS [digital audio radio service] satellite, you know dish-type thing, into cars. We're charged with formatting 5 of those networks and handling 45 others in terms of selling their time.

FROKE: Let's go to education and spend some time on education. When I first got to know you, you were developing then your concept of mind extension into, then, what you called Mind Extension University in your channel.

JONES: Right.

FROKE: We were talking within the context of television at that time – television distribution. And you went on then and established relationships with a number of colleges and universities ...

JONES: ...100 over time.

FROKE: ... partners, affiliates and so on. What prompted you to move away from that format? You, in effect, were the organizer, the administrator, and then the colleges were the ones who developed the courses for you.

JONES: Right. And we put them on-line – well, we put them on television. We created the courses too. We would co-produce courses and whole degrees with them and things like that. So you could literally get your degree from your television set.

FROKE: Was it a flexibility issue comparable to what you ran into with Bell of Canada?

JONES: No. I'm very fond of the academic community actually. But it was just the evolution of things. I sort of always wanted to do something like this with tele-medicine or education. We did some experiments with tele-medicine down in Atlanta that worked really well. So we've got more to do there.

FROKE: Was it the pace of which they moved in accepting technology and you wanted to move a little bit faster?

JONES: No. What happened is, I had .... The way I started Mind Extension University was I had been reading voraciously - which I have back-packs full of books, and I don't even know what I read or who wrote them necessarily. But I just buy hundreds of dollars worth of books, and I put them in back-packs, and I just go through them and I don't know what happens when I'm through with them. But I'd been reading about education and educational problems in America starting with K-12 problems and how that was impacting our ability to survive as a nation and as a viable work-force in the 21st century. I had just finished reading a book called A Nation At Risk, which is a blue ribbon empanelled written book. There was a paragraph in there that said, "If the education system that we're living with today in America were imposed upon us by a foreign power, we'd deem it to be an act of war." Do you remember that paragraph? Anyhow I'd just read that book and it was a wonderful fall day, and I went to Washington, DC. I was in Washington, DC and my plane was at National Airport and you have to go in and out of there by appointment. I was early. I had finished early so I had my car drop me off at the Vietnam Memorial because I had never seen it before. I walked in the back end and walked through. That particular day it was very busy. People were in there and they had papers up, with a pencil, and they were getting the name of their loved one off the wall. They were leaving flowers and there were some ex-GIs there. One guy didn't have an arm. People were leaving poetry and crying. It was just ... I was overwhelmed by the whole thing. So I walked all the way through and then came back. And I was so shaken that I couldn't make it back to the car, and I found myself weeping on a park bench, looking at this monument. It was this beautiful fall day, and my mind was just sort of trying to get back together, and I was thinking about these guys and the commitment they made. I was thinking about Korea and my involvement with the military and my brothers. I was getting ready to get up again because I'd sort of regained my composure ... and this big leaf ... I think it's a sycamore. I framed it. It's up in my office. I kept it in a tablet, and I found it again and I framed it. The stem hit me right here and fell on my lap and just laid there. I looked at it and I picked it up and I said, "Is this a message from God or what?" But anyway, I sort of did have an epiphany. I decided that for the rest of us ... and I had just finished the philosophy behind a book that I had started to write when I was in the Navy about freedom. And I just had finally figured it out – how freedom worked in America. It was a novel that I'd written, and I still have it. But I could never finish it because I didn't really know how to finish it with this ... it was a philosophical sort of novel. At any rate, all this had been going on in my life. So I decided that I would - if education were such a problem in America, that for those of us that are still alive and have the means - that we should commit ourselves to solving this problem with the same compassion and the same commitment represented by what's represented by the Vietnam Memorial. So I decided I would lay high-grade education all across America immediately - which I did. It was a matter of months to get ... it took me a few months to get cranked up and get it done. I got a satellite transponder, uplinks, and I launched Mind Extension University dealing with K-12 AP courses, delivering them to high schools and anybody that wanted to see them. They were free. And we were teaching Russian, Spanish, German, French and Japanese, math and sciences which is where the problems were. All the AP ... when money began disappearing from school budgets, they dropped the AP courses because there were fewer people involved. We were uplinking education from all over bringing it down in Denver and then re-uplinking it to Sat Com 5 and down-linking it. We were covering everything from Alaska to Venezuela and Hawaii to Bermuda. We eventually wired up about 1,000 high schools. I thought that this would really work with cable because we needed to more of this kind of stuff in our markets. It would be good for us to do this. We needed to do it. Not only that, it was intelligently selfish to do it because it would develop a new relationship with our subscribers that was different than sometimes the antagonistic relationship that we had because we were raising rates and things like that. We did that so we could accumulate ... and I did that for 2 years and it was just losing money like crazy. But we would accumulate Japanese students, for instance, one of our Japanese from Alaska and he's in Texas in a little town. So we had people that were getting full scholarships to MIT and things like that. It was terrific. The parents could watch their students too. We kept the classrooms down to 250 students in size. We really had this going, but we just ran into the bureaucracies of schools. We'd have to send a teacher, an English teacher, from San Antonio to New Jersey to take a physical so the kids in New Jersey could get credit, you know, stupid things like that. So I could see that I'm going to get burned up. Nobody in the world has enough money, unless you're the U.S. government and can tax people every year, to make that go. So I decided to go into higher education – concentrate in that market because that was an easier market to work with. I could teach teachers how to teach using technology. Then I'd come back and address the grade school problem. So that was sort of the derivation of all this. It just evolved with the technology. Then I got ... we launched in Bangkok. We had 800 numbers. But there wasn't an 800 number in Bangkok. By that time I was into the internet big time because of stuff we were doing with the Library of Congress. I was one of the founders of the Madison Council there. We had a thing called the American Memory Project, in addition to the Global Library Project that we co-ventured with them, to move the contents of the library to the rest of the world because they were electronically remote. We had ...

FROKE: ...You led the way with the Library of Congress on digitization.

JONES: Well, that's probably an over-statement. But the thing is ...

FROKE: You charged them up to get moving.

JONES: We put ... we got a copy of this. It was a laser disc juke box and put it in our headend in Jefferson County and ran it through Columbine High School actually and fitted out the library - where the disaster happened - in Columbine High School with the ability to access early American history digitally from our headend and do papers and everything. Then we got the software working to deliver to two, then three libraries. Then you could uplink it by satellite and lay it all across the United States. In addition to which, I wanted the Library of Congress to be my library for my cyber students. They were very simpatico to it. So anyway, now I don't have an 800 number to get back from Bangkok. We were experimenting with the internet at this time also with this laser disc juke box of American Memory from the Library of Congress. We just went to the internet as the 800 number back from Bangkok. So that all evolved. Then it became really apparent that ... two years after I started Mind Extension University, Ted Turner, J. C. Sparkman and myself and Amos Hostetter launched Cable in the Classroom - probably a little conspiracy going on there with Jim Mooney, who was NCTA director and a group of others that I could name, to put the lid on Mind Extension University because it would interfere with the political card and ...

FROKE: ... With Cable in the Classroom?

JONES: With Cable in the Classroom. It wasn't just the political card. They were legitimately trying to do something significant but ... which sort of closed down distribution, the acquisition a distribution base for Mind Extension University. John Malone was very helpful. He launched aggressively. And others did. But it wasn't enough. And that's sort of carried over. There's some groups of systems now, at this late date, still don't have carriage.

FROKE: Is this what prompted the ... well it wasn't your withdrawal, but you were not terribly active with Cable in the Classroom.

JONES: Not after it's organization. It immediately ... Amos Hostetter was appointed as the sort of the chairman and overseer of that by Jim Mooney, and it was held in tight control.

FROKE: The logical thing would have seemed to be that they would throw everything they could to support ....

JONES: I thought that would have been logical, and none of that ... we could have done both. You know, Cable in the Classroom is fine, but it's nothing near what we could have done. The governors of the country and the regulators really wanted to see things like Mind Extension. They wanted to see distance education. In the early days, Cable in the Classroom was antagonistic to distance education. We had some significant arguments about that. But it was basically positioned not to interfere with the NEA or PBS aspirations, whatever they were. Nobody wanted to get in front of that. And of course, we were an unruly horse in terms of what we might or might not do because we had no allegiance to anybody but our students and what we thought the world wanted. So that explains that.

FROKE: Before I forget about it, I should point out that you do have a record as an author even though maybe the one book has not been finished yet. You did the first dictionary of cable, ...

JONES: Right.

FROKE: ... establishing an educational base for what the industry was doing.

JONES: Well, the dictionary came about because, in the early days when I was selling partnerships, nobody knew what cable was and they didn't know who I was particularly...

FROKE: ... So it became the means to communicate with them.

JONES: ... the bankers did. So I decided, well, how does one become an authority and get past this authority problem. I said, "Well, I'll write the dictionary for the industry." We need a lexicon because the telephone companies were creating terms that were getting into franchise who were antagonistic to cable's interests. So I said that we need a lexicon with terms that are favorable to our interests. So I created the dictionary. Then it ended up on all the shelves of all the bankers. So I could walk in and look, and I could see the dictionary there and nobody ever talked to me about whether I knew what I was doing or not anymore because I was the authority – because I wrote the dictionary. Then we translated it into French and it got used around the globe.

FROKE: Your poetry saw publication.

JONES: Well, the poetry I started writing just because I liked to do that. But secondly because I thought that, especially in America, people look at businessmen as hard-edged, not too complex, grind-the-face-of-the-poor-in-the-sand kind of people, especially on television and in movies. The bad guy that is always poisoning his wife and selling dope or whatever, is always the business guy. So I thought, well, I will write poetry. I'm a business guy and people will be confused by all this and maybe they'll stop and think about maybe business people aren't that bad.

FROKE: You were too early to get into the children's literature bit with you dragons.

JONES: Yes, well ... Plus I think that business is an art form. I think it's the art form of America. Money is stored energy that can be used like a painter uses paint. I can buy this glass or this chair or whatever component of things I need to create a new product or a new service. And if I win, I win. If I lose, I go broke or I lose a lot of money and start over again. But it's no different than a painter painting a canvas with different colors of paint, except it's more exciting because it's three-dimensional. You're dealing with human beings who are complex and always moving. Nothing stands still. So it's truly an intricate art form. That's the way it's always been for me, and you have to deal with the virtuosos instead of the mechanics. You find out who they are and you deal with them, you know, like you deal with a good violin player. You find out that these are all a part of your life.

FROKE: And then you did find time to write an educational treatise about educational technology that got good reviews.

JONES: Well, it's called Cyber Schools. People started to pick up on it now actually. Sales are starting to pick up. It was a little early. I think we were a little ahead of the curve. Now free market fusion, which is a philosophy and process and tool kit on how the free enterprise system, the private side, can interface with institution or non-profit side of our culture to create new products in the 21st century.

FROKE: You have touched on so many things that relate to your sense of business and your sense of organization, and they all seem now to be moving toward culmination with your JonesKnowledge.com. It then, is the parent organization of your educational institutes. Within JonesKnoweldge.com, you have taken the e-mail web site type of address and really made it the corporate name.

JONES: Right.

FROKE: So it's the corporate name that...

JONES: ... Everything's just in cyber space there pretty much. When the accrediting agency came to accredit ... it took us about four years to get through that process which was grueling, but fair, I must say because the world needed a model for quality, accredited, on-line education. Now we have a model, and they wanted a model too.

FROKE: So what you did then was put together the parent organization and then began organizing the necessary subsidiaries to, in effect, create the institutional structure as well as the institution itself. And you then have Jones International University.

JONES: Right.

FROKE: And then you have e-education which is the process for ...

JONES: ... Right. That includes e-global Library ...

FROKE: The library? You've got something called ...

JONES: Life-long Learning Society.

FROKE: ...Jones GetEd

JONES: ...Yes, which is a ...

FROKE: ...cataloging of distance ...

JONES: Right. And eventually that'll be whatever – if you have problems with education, you GetEd and we're going to create a ...

FROKE: ... Within all of these mixes there's a student service, there's a financial model, there's a counseling model, there's a course development process?

JONES: Right and a grade book so your grade's immediately, instantly returned to you.

FROKE: Then you are moving ahead with your Jones International University as a separate, free-standing, accredited institution.

JONES: Right.

FROKE: You're now offering a baccalaureate completion degree program in business communications. You're offering a master's degree in business communications. How far are you going to go with your curriculum?

JONES: We'll have a Master's in Business Administration up next month and plan to create maybe 4 –5 new degrees each year. We're producing them in parallel now along with working with other universities, licensing courses to them and from them and sort of .... It's a global concept. We have students from 34 nations already. We have formed an organization called the Global Alliance of Transnational Education. UNESCO is involved and the OECD and Russia, people from China, South America, Africa, from all over the world. We're having our meeting this year, our conference, in Melbourne, Australia hosted by Monash University, the largest university in Australia who has gone through the accreditation process of GATE. GATE is a stand-alone, global accrediting body and also is building a database that rationalizes education on a global basis. So if you get a 2-year degree in Ceylon, now you're in Hungary and some manager is trying to hire you in Hungary, how does this guy know what this is, anyway, that you got in Ceylon. So this HR officers and entrance officers at universities all have this problem so we're trying to do this ...

FROKE: ... So you're really not drawing any limit on liberal curriculum?

JONES: No. It's a global, electronic platform, totally global. Most of our course work we'll do ... we're working with American University with ...

FROKE: ... Will you be primarily, well obviously it will be, going beyond English, will you be multi-lingual in some of your courses?

JONES: The course-ware now is in Spanish as well as English, and we can put it in any language in 30 days.

FROKE: Say that again will you? In 30 days you can have ...

JONES: ... have it in Hungarian or Russian or Chinese or anything.

FROKE: Is this because of computer technology partly?

JONES: Well, it's the way the software is designed. The content itself will not be in Chinese. Instructions and all that will be in 30 days. If you're at the University of Beijing, then you'll be in charge of putting your content in this shell in Chinese. But the software itself will be. You won't have to worry about that.

FROKE: Another quick observation, in addition then, to your free-standing institution, Jones International University, you put together an educational service agency that services all other colleges and universities to move into the internet age and the space age.

JONES: Right. We can replicate them in cyber space in 30, 60 days. Typically what's happening – they're just putting degrees up or just single courses in cyber space ...

FROKE: ... That in itself is ...

JONES: ... convert those to the internet.

FROKE: That in itself is a new type of institution, isn't it?

JONES: Yes.

FROKE: There's a collaboration among colleges and universities on a limited basis because it's so difficult to achieve it.

JONES: It almost takes somebody from the outside to get all this working because there is a lot of competitive spirit amongst the universities. There's a lot of leadership in that environment too and a lot of people that are embracing change. But there's a lot of resistance as well. There's a lot of "we've got to do it all" in every university. Of course, that's nonsense. Take trigonometry. It's trigonometry. You don't need a California trigonometry, a Colorado trigonometry and a New Jersey trigonometry. Trigonometry's trigonometry. It's just, the duplication is not, you know, reasonable. The degree to which, and the amount of, education and training that needs to go on going forward is a compelling argument for doing it some other way because the United States, if you add up all the seats in all the colleges and universities, there's about 15 million seats. There's another 100 million Americans, adults, that want and need additional education and training. This is the way to get it, especially in the telecommunications industry, the cable industry as it morphs into whatever it ends up being. We're very dedicated to making that the highest trained, best, hottest work force in the world. That's how we can continue in the cable business.

FROKE: I'm going to interrupt you just for a brief moment and .... It comes to a realization that the tape that we're on is just about ready to come to an end, and we still have some conversation that I would like to pursue. We either can have another hour here tonight or we can come back to Denver at some later time.

JONES: Let's do it another time if that's all right. I appreciate your coming here to do this. You're the only person in the world I would do this for and hadn't intended to really do this. But I have a ...

FROKE: ...You have another commitment to .... All right.

JONES: Yes, and it's a political thing ...

FROKE: I'll schedule a time and I'll drop you a note. Basically what I would like to do is spend more time on this educational issue because obviously it's terribly significant. Then in addition to that, I'd sort of like to reflect with you on some other types of things that you might want to talk about in terms of where the industry is going, cable, both from an organizational point of view as well as programming point of view or content point of view. So let's say that this is Part 2 and we will record Part 3 at some later time. Glenn, thank you so much.

FROKE: The date is September 12, 2000. We are in Washington, DC in the studios of C-SPAN to visit with Glenn R. Jones, one of the great pioneers in the cable television industry and a person now who has, as he explains it, gravitated toward the content side of cable. As I would talk about it, it would be the educational side as the technology takes on new dimensions in providing organized systematic education to not only the United States but the world. I'm using some of your words, Glenn, so you'll have to forgive me. I'd like to go back at the very beginning. You are, as I said, one of the great pioneers in the cable industry. You touched every aspect of the industry. You're widely known for the entrepreneurship that was expressed in how cable was financed with the limited partnerships that really got cable moving. We talked about that in an earlier conversation. On the technology side, using Alexandria, Virginia, as your flagship station so to speak, you pioneered practically everything for the cable industry, even leading up to the point of fiber and interactive television. You were out in front on customer relations. When it came down to the issue of how you reacted with the cable customers, you had the top rating, so to speak, of satisfied people with your selection of programming, your response to request for service, your response for request for new services. So you were way out in front, and it had all sorts of advantages for you and also kept you running. With that perspective and everything you did that was so innovative and, in many respects, unique to the industry, where do you now see cable going in the year 2000? What's ahead for the cable industry?

JONES: You're too kind, Marlowe.

FROKE: No I'm not – not at all. I admire you greatly as you undoubtedly know.

JONES: And I would like to just say a few things about how those things got done. One of the big events in our company was when my brother Neil came on board to help us with the limited partnership concept and put together a selling group that actually worked. I could never sell anything myself so it took somebody who knew how to do that. He was fabulous. We had guys like Bob Lewis, Greg Liptak, Kevin Coyle, and Jim O'Brien who was fabulous, Al Angelic, Tim Burrick and guys like Carl Vogel who has gone on to bigger and better things (he has an incredible career in front of him), and just a real lot of people made that happen. So it's sort of inaccurate to point the spotlight on me. I was just sort of along for the ride.

FROKE: You're very, very modest and I do recognize the talents of all those people you identified.

JONES: But where cable is going from here – you could see it evolving even 10 years ago into sort of where we are now, but it's morphing into a whole new kind of industry that is, as yet, unnamed. AT&T is calling it AT&T Broadband which is probably a pretty good name. It will be interesting to see what Time Warner does with it when they merge with AOL. It's no longer a single product, video product kind of thing. In Alexandria, for instance, we were delivering cable telephony, and we launched the first commercial internet channel even before @Home and Roadrunner there. So we became the first _____ there and we drilled the hole underneath the Potomac River to connect Maryland with Virginia. When you're dealing with all that fiber, you just automatically become broader and deeper than what we typically think of cable as. So the term cable is not very descriptive anymore. But it will end up being a piece, a very vital piece, of a larger industry and I'm not sure what people will end up calling it.

FROKE: What primarily began as a distribution medium has now become an all-encompassing industry in communications.

JONES: There's so many things that you can do, you know, when you get into digitized formats. One that we've tried to position ourselves is in the film business for instance. We started about 10 years ago. The reason for that was to be around and learn the business so that when the analog distribution system destructed under the weight of the digital world, that we would be there and try to piece together the pieces for a new distribution system of some kind. Education is the same way. You can do so many things. The Internet, not just the Internet as we know it now, but Internet 2 and Internet 3, when you contemplate that Gordon Morris law – generate computers every 18 months, make them more powerful, cheaper, etc. – if you take the chips where they are now and generate them for 15 – 20 years which Andy Grove says he's going to do and he should know, then you superimpose upon that the algorithms that are making band width capability inside the fiber, the generation rate is even faster than the 18 months at this point in time. So the capacity is really awesome. What you cannot do now, you'll be soon able to do. We'll be doing things that are not even contemplated at this juncture, but it will be huge.

FROKE: Individuals will be able to manipulate their way through the communications system as almost a personal means of communicating.

JONES: You can see electronic communities going on now. In the university, for instance, the students study in a specific place, in chat rooms. But they're from all over the world, Finland, United States, Mexico, and so forth. This is an electronic community. People don't really think about that – that it is an electronic community. People are reaching out and extending the human mind.

FROKE: On a personal note, e-mail came home dramatically for me when our older daughter, who works for Associated Press, went to Sydney, Australia to be on the coverage of the Summer Olympics for Associated Press. So on a daily basis, we had e-mail messages going back and forth. It was just unbelievable the personal ways that people can keep together.

JONES: Our intention was, in Alexandria for instance, to recreate Main Street and some of the tributary streets and we put the stores that are there. But we also put in our own university and then we had a theater that you could go into and get movies that wasn't there but was ours. Then we had these 12 radio formats, the largest country music radio network in the world. So that was there. The whole thought was to sell real estate in cyberspace – for instance a jewelry store. People will cross over into the virtual world from the real world, from the tangible, without even thinking about it. They're starting to do that now. So you could go to the jewelry store and say, "Mr. Jewelry Store Owner, would you like to own the property above your jewelry store or will that be somebody else's jewelry store? Mrs. Smith that lives in the suburbs either can get in her car and then try to find a parking place, see if you've got what she wants, spend half a day buying a bracelet, or she can jump on the Internet and go to the store on top of you and get it and have it delivered to her. So you should own that store too." So we were going to have a cyber lease. I started to build a cyber lexicon, but we didn't get finished before we sold out.

FROKE: As you talk about what you were doing in Alexandria, it occurred to me that it's too bad that you did not have the Washington, DC franchise.

JONES: No it's not. We had the opportunity but it was a great opportunity for somebody else.

FROKE: With all the imagination you had, ....

JONES: We had a contract, you know, for Montgomery County so we were combining the region pretty rapidly and pretty well. We had a partner that was not predisposed to move.

FROKE: As you were talking about the new types of organizational structures that are moving into place and yet to be defined for the cable industry, I thought about the need still for a local contact. Won't the local cable operators in the individual communities still have to reach out to the people of their communities and will not that sustain a position, a name, for cable?

JONES: That will clearly create a position and that function is a very necessary function. But I think that the branding will be all different and may or may not be related to cable. CSR is probably a good example. When somebody calls in, they could be calling in about cable or ISP or telephony or long distance or anything. I think people tend to think of video programming as cable. So I'm not sure that the name "cable" will survive into the future that long in large markets because you'll have national branding like AT&T Broadband. But there will be a manager, just like there is a manger for the NBC affiliate.

FROKE: So it will be a little bit like retail where the retail names have a tendency to disappear in a relatively short period of time.

JONES: Yes. You can see that starting to happen already. When we acquired systems, we changed the name quickly on the trucks and everything so we could have a national branding campaign. Others will do the same thing. But I'm not sure the name "cable" will be inculcated necessarily into that name as people start thinking in terms of broadband and doing all these other things – turning the lights on in your home, or the oven as you're driving home from work. These kinds of things will eventually be with us.

FROKE: When we visited on the two earlier conversations, Glenn, we spent some time on education. You brought me up to date where you were in terms of your approach to the field. You've been a leader in the field and, behind the scenes, many people have been looking at what you've been doing and then going on and creating their own version or their own variation on it. So you have, then, the Jones International University which, last I heard, you were operating at about 18 different countries. You've have maybe 30 different educational programs, certificate programs, degree programs. You had a president of International University. You had a faculty. It was growing, in many ways, like an institution except that it was not bricks and mortar as an institution. It operated on a world-wide basis. Since then, we've had the University of Phoenix, Harcourt is moving into it now. Milliken is also fooling around on the edges of it. There are one or two others that are operating in what they say are national/international types of universities using e-technology, on-line so to speak. Where does Jones International University stand at the present time? What do you see for the future for it?

JONES: Right now we have students from 45 different countries so it's growing very rapidly.

FROKE: In a relatively short time.

JONES: Oh, yes. We've launched a new MBA program. I forget what I said in the last tape, but that's been credited by North Central's accrediting agency. We're still the world's only totally on-line, fully accredited university. So students are coming on-line very rapidly, and we're increasing the number of degree programs. Our next degree program will be a master's degree in e-education. We're a research university so that we concentrate only on on-line learning. I think also since we launched our e-global library which is an electronic library, a full research library, we're starting to market that to others in addition to using it ourselves.

FROKE: And another subsidiary is your Knowledge Store.

JONES: We have Knowledge Store and Life-Long Learning Society and we have, of course, our e-education software which is ...

FROKE: ... a service to other colleges and universities. The state of Florida has just awarded us a contract for all the Florida high schools to go on e-education software after an exhausting analysis of all the products on the market. We have about 150 clients around the world including Hungary and Argentina, Mexico, Chile, Switzerland, France. It is growing very rapidly.

FROKE: You've become something of a spokesman for the use of the technology and appropriate ways for learning, organized, systematic learning as well as informal learning. When you speak about the countries you now have working with you, 45 countries, does that mean that you are on the road a lot with contacts in each of these countries or does your staff do quite a bit of it now?

JONES: I have a group down in Uruguay right now. A number of them are involved in forming networks at universities and putting them together into cyberspace as a cyber-university. In other words, they all participate and use our software and our library. So it's all plug and play now. There are about 3-4 interesting networks of universities that we're working with to replicate them as one university in cyberspace feeding off the courses of the various universities involved around the world. One of the organizations is called the World Alliance of Global Universities. The universities become global by going on line because then you're automatically global. Then we formed off this the Global Alliance for Transnational Education which is one of the building blocks you need for global educational cyber environment. We did this because there was no global accrediting body so we formed one. The OECD is a member and others, people from all around the world. Last year we had our meeting in Melbourne, Australia because we had just accredited Monash University, their largest university. Their programs are, I think, in Hong Kong and Singapore. We just got through certifying Tomps University in Pakistan, their engineering programs.

FROKE: And this is the Global Alliance for Transnational Education?

JONES: Right. I've reorganized it now to focus more on electronic education because, as I said before, the minute you're on the Internet, you're global. So we will certify not only site-based institutions like universities, but also any learning activity whether it's a corporate course or a degreed program for a university or any kind of learning activity as they proliferate in this environment.

FROKE: Let me make an analogy here, and then you stop me if it's incorrect. The book publishing industry was central to the development of the organized systematic educational system of this country whether it be elementary or secondary or higher education. The book publishing industry, in effect, was the core of the organized, systematic learning program. Is your e-education becoming, then, the book publishing industry's approach to higher education here in the 20th century?

JONES: No. There's a strain between what Toffler would call the second wave and third wave environments.

FROKE: Okay. You did not necessarily draw from ...

JONES: No. You can see it happening in Harcourt and Pearson.

FROKE: Toffler is now on your Board of Directors.

JONES: Yes he is. I've gone around to Cambridge and other places and talked to publishers. They're straining to find a way to preserve their data base. I call it a data base – all the books that they've created over the last 100 years which aren't archaic. The book is a great delivery system when you think about it. A book is endurable. It's portable. It is indestructible in a lot of ways.

FROKE: It's easy to read when you can't go to sleep at night.

JONES: Right – all that good stuff. But in the digital world, what we're doing at JIU, we've issued e-education. We have evolved a new release of our software which all in Java which is very object friendly, object-oriented friendly. So what we will do with our courses is break them down into minute objects, each definable and each in a repository that's searchable so that we can use those learning elements, those objects, gradually, to build courses on the fly for people that need this piece of just-in-time education to do their job or to put together a new degree program so that we don't have keep reproducing things. And we'll sell them agnostically to the rest of the world. But even if you have all this content in book form, you still have to go through that process to do this. In our e-global library, for instance, we have 20 cybrarians and all the stuff is supportable 24 hours a day, 7 days a week. We will end up with 50 topic categories and we have about 3,000 digital libraries around the world. Some of them we've had to disaggregate and recreate so that they're searchable according to our standards. We're hot-linked into the Library of Congress as well. There's a real problem preserving your assets in a fast-moving digital world. From a competitive standpoint it's not that bad even a company has been in business for 100 years – except for brand name. That's important.

FROKE: You used the term cybrarians.

JONES: Yes. They're librarians in cyberspace.

FROKE: That is a part of your strategy to make sure that the second wave and the third wave, as you were alluding to with Toffler, does not get confused too much with the historical past.

JONES: It's like a billing engine. You know we have another company called Jones Cyber Solutions that builds a front-end intelligent management system that fits on the front end of billing engines to run your company. The problem is, with billing engines, you get into all these building engines that are clumsy and clunky. You can't slice and dice everything. If you try to pull that along with you, you've got a real problem. You're almost better off, if you have the money and a certain amount of time, to construct a new billing engine that's robust and does what you really need to do in a digital environment.

FROKE: Let me identify an apparent, to me, contradiction then. In addition then to the innovation approaches to education that we've been talking about, you also have been very, very supportive of the Library of Congress, for instance, in its transition into the new technology. Is that not dragging along the old system?

JONES: I think that's different. They're not trying to be competitive in a competitive marketplace particularly.

FROKE: You have to look at it in a different context.

JONES: I look at it in a different context. And it is the largest repository of information in the world. As I said, I didn't have a library for my students so I thought I would go to the Library of Congress and we were successful in making some arrangements there. Also, the Library of Congress is irreplaceable. It's why I thought that the Washington market was the best market in the world for a cable system, and why I started to accumulate the market around Washington. If you're in an information and knowledge culture, information culture moving to a knowledge culture, then you have to look at Washington as Fort Know. That's where all the information – not all the information – but you have the Library of Congress, the Smithsonian, the National Health Medical Library. And all that has to move in and out to get to the outer reaches of the world. So it would be better if they traveled over my pipes than somebody else's.

FROKE: Looking at some measurable things that may or may not be relevant in the early stages of where you're going, how many students are enrolled in your various courses at the present time?

JONES: On our software at other universities, we have about 15,000 – 16,000.

FROKE: All right.

JONES: But that grows, of course, almost daily. In our own university, we're pushing 1,000 now, and we're going along about 50 a week right now, but I'm trying to get that up to 400 a week. It's very scalable. There's no reason why you couldn't have 250,000 – 1,000,000 students.

FROKE: Have you reached the point with Jones International University and its various components of financially self-sustaining?

JONES: No. I still sustain it. I'm my own investment capitalist. At some time I may go to the market. We'll see. There's no need to do that now. I know that it's going to be successful and it's going to be huge. So there's no use rushing and going to the market.

FROKE: Individual colleges and universities, some of them operating in consortiums, have attempted to establish an online type of presence. For instance, in your geographical home base originally out in Denver, the mountain states went together, and there was a lot of publicity and ...

JONES: The western governors.

FROKE: Yes. The governors had a very flamboyant press party to identify what they were doing. But my information is that nothing really has happened with that.

JONES: Well, it's not a zero sum. What they're doing they've been basically doing for 10 years so there's really nothing new in all that. It was a noble attempt to bring those resources together and a great experiment to do that. So we're very hopeful that they will be successful because we can all be successful. It's a special kind of business. It's a special kind of competition.

FROKE: Is the bureaucracy of individual colleges and universities so great that it's extremely difficult for them to collaborate and cooperate?

JONES: Yes. Yes it is when you come right down to it, it is. Plus there were 14 states, 14 governors. Some of them wanted to be the next education president so they had political agendas that are fine - they can be convergent with all this. Then you had universities in each one of those states. Some were sort of protecting their turf and could work harder for the cause, maybe, at the end of the day, and some that were. Then the accreditation process because you're in 14 states that I don't think are accredited yet. You're crossing the boundaries of 3 –5 accrediting agencies. So then you have to get them together. It's really stacking miracles to get into the political agendas of all these universities and accrediting. It's very ambitious – what they're trying to do.

FROKE: The audiences that you are reaching, I think, are so primarily the adult audience, the audience that can, on the availability of time, study only on a part-time basis. The older student, the part-time student then is your clientele primarily. That will continue to grow, and I'm in full agreement with you. Do you also have an audience for the conventional, under graduate?

JONES: We do.

FROKE: Is that where it comes in with these colleges and universities that use your e-education materials?

JONES: Yes, they use that. And then we have these conferences on electronic global libraries and things like that, and we refine the software, and then we make it available for everybody's use. We license it to everybody on a real agnostic basis. That company, JIU, is just another university so it doesn't get any special treatment. But it floats entirely on this so everybody knows it works. If it doesn't work then, you know...

FROKE: Occasionally a political figure will latch on to on-line learning and such things as the Jones International University and will say such things as, "It's not too long before the brick and mortar university will disappear."

JONES: I think that's unnecessary to be in a discussion. I don't think that's true in any way. Some clearly will have to get with it – these smaller universities that don't have the IT staff. We're very helpful to them because they can just plug and play, big time, and have even better software than some large universities that have crated their own that are clunky and don't work too well, that aren't keeping up. They'll find themselves disadvantaged in terms of the marketplace to the smaller colleges that have more stream-lined technology that they're using. Some of them will hang in there and clutch the past and just will be embarrassed. Hopefully none of them will be – but it's really an augmentation technology not a replacement technology.

FROKE: Many of the colleges and universities will adapt and modify their instructional methods.

JONES: You can see them doing it now. Probably 80% of the universities in this country are doing something on-line. It might be just a course. Some of them have degree programs. You're starting to see them. We've been talking to a couple of them about just replicating themselves entirely into cyberspace. Those conversations aren't progressing very rapidly. So I think after people have time to exhale a little bit and take another breath, they'll feel better about all this.

FROKE: You and I had some good conversations and a certain level of aspiration related to Jones International University and the National Cable Television Center and Museum. I'm no longer with The Cable Center as you obviously know. What's the status of that relationship now? Is anything happening there?

JONES: Between?

FROKE: The Cable Center and Jones International University.

JONES: We're sort of, as I understand it, we're going to be their cyberspace tool. The building is not finished yet. I think when the building is finished and people move in, settle down and really get organized, ...

FROKE: Some of those things will begin to happen.

JONES: The University of Denver and their University College is using our e-education software extensively.

FROKE: They are using it now?

JONES: Of course that's the site of The Cable Center. I think The Cable Center, very realistically and intelligently, has described itself as an education outreach organization, not as a museum - which would be really inappropriate, I think.

FROKE: Right. In addition to the educational emphasis in content that you have, you also have other content initiatives. They include, then, your radio/audio program service that operates on a worldwide basis. Where does that stand and where do you plan to go with that?

JONES: It's growing pretty rapidly. We have two cable networks, Great American Country and Product Information Network. I kept all of the rights and inventory, library, to Knowledge TV and all the graphics. I just sold the analog distribution rights to Discovery. So that's relaunchable on the internet when we get around to doing it. When the streaming technology, we're using it a lot in education. We're doing live on the net events with country music stars. We started a country stars web site and we're getting a little over 3 million page views a month now and it keeps climbing. We just launched prorodeostars.com so we're launching a lot under a company called Jones Direct. So we're sort of reconstructing things in cyberspace in that company, Jones International Networks, on the backs of existing companies that already have cash flow. This is just the opposite of what I'm doing with Jones Knowledge Group. It's a total Internet play – just the converse.

FROKE: In your interface with Internet, do you also see Internet becoming primarily a highly specialized type of service? Some of the program services that had been established, some of the organizations that had been established in Internet, the web sites, and so on, to sell what was basically a television program service, are beginning to fall by the wayside now. It not really a program service on a sustained basis as I see it.

JONES: The Internet?

FROKE: Yes, the Internet and the web sites.

JONES: I disagree.

FROKE: You disagree?

JONES: Yes. My thought was that, as I mentioned before, that we might be able to replicate cable in cyberspace on the Internet and not have to own the pipes. As this streaming technology perfects itself, and of course we're doing audio on the Internet now with Internet radio stations and things like that, that you can put together a package. It can be a different kind of package than cable. You can put together a defined package of networks – audio, video, education – and sell that package much like you sold a tier in cable only you sell it on the Internet. You don't have to own it. So you're selling it on a commoditized platform that's cheaper than owning it.

FROKE: If you circumstance different, though, from so many of the others that have tried to establish a program service on the Internet? You draw upon a large amount of resource materials. You have a strong library and video and graphics.

JONES: I have a theory. It's called a body pile theory. I don't know whether I've explained this to you before.

FROKE: Nope, nope.

JONES: You see you're an entrepreneur and you have an idea. There's a lot of them on the Internet. You see the brass ring turning around up there, shining and glistening. So you get some financing or you have your own financing. You spend a lot of money, create a product, and you reach for the brass ring but you fall because you're not high enough to reach the brass ring. So you fall, and you become a piece of the body pile. So the next guy comes along, sees the brass ring out there, same brass ring, raises some money, runs his course, falls on the body pile. Then the body pile gets bigger and bigger and bigger as people spend more money. So the trick is to be the guy on top of the body pile that can actually reach the brass ring with your money. I've learned that the hard way. It's an old saying that if you're dealing on the knife-edge of technology, it's good not to get ahead of the blade. It's sort of another way of saying the same thing. So I think we need more bodies on the body pile. We're building chunks of it that are, in themselves, stand-alone businesses. People will put up with more to get an education than they will for entertainment. In other words, you'll put up with production problems and things like that if you're getting your MBA that you wouldn't put up with for a minute if you were watching a movie or a sports event. So I'm working over there while this other side is going together. The audio side is pretty good so I've got that going. And all the music we do – we produce or create 2,000 hours a month in new programming.

FROKE: All over the world?

JONES: Well mostly here and it's mostly audio. We produce videos as well. So we're building a database. If I can start metatagging it now, because that technology is coming along too, into objects that I can build networks from my database, it'll be like a movie library only much more useable and much more versatile in a digital context. I think that the time will come, and not that long off, when the Internet is a huge entertainment vehicle. It's a whole new industry. It's a whole new mechanism for this stuff. It will be different. It's like education. I'm keeping my movie company, Jones Entertainment Group, but it's sort of a stand-alone, off by its side, doing documentaries and things like that right now. I'm sort of waiting for things to happen so that we can create things for the new world like education will be back in production when we start streaming enough video. But it will be a different kind of production because it will be very interactive. It's going to be different than what went on before but a lot of the same skills still required. So you keep those kinds of people around so you can weave that together when the time is appropriate – when you're standing on top of the body parts.

FROKE: So in the cable industry, you see, from what you've said today, a new type of organizational structure evolving, and it's still not defined to the point where you can say that these are the categories of the organization of the cable industry of the future because the cable industry, in terms of terminology, might not be around 10, 15, 20 years from now. And it seems as if you're having just a marvelous time, Glenn, with education and content. The Internet is going to be seeing a lot of you in the future.

JONES: Well, I'm totally consumed with it. As a consequence I really don't think about cable a lot these days. I loved the business, but it's something I did and now I'm doing something else. My energies and brain cells are focused on the new things that have some relationship to what we used to know as cable. But it keeps refining itself and even the relationships back to it.

FROKE: You're having a great time.

JONES: There's a candy store out there right now for entrepreneurs.

FROKE: That's good. Do you have anything else that you'd like to comment on before we bring our conversation to a close today?

JONES: Not really, Marlowe. It's just that there have been so many great guys in the cable business. It was so character-rich, just wonderful, wonderful people – Johnny Rigas, Allen Gerry, John Malone, Bill Bresnan. I could just go on and on. Each one of them you love. They're just cherished people. It has been such a magnificent way to spend the decades, being associated with people like that. Sometimes we're competitors beating each other up for franchises, but I just think it was a very special time with very special people that were very committed and enthusiastic about creating a whole new something - nobody knew exactly what it was – industry that kept defining itself. It had such an entrepreneurial spirit and entrepreneurial drive that may be missed going forward. But on the other hand, I think in large companies like AT&T, you probably need a different kind of talent to run those kinds of organizations. Of course John and Chuck Dolan are building their own organizations and now they'll be part of this new world. It's just been really fascinating. And Comcast – the same thing. They're becoming large companies in their own right. But they, too, are morphing into different things. They're going into telephony, ISP stuff. They're doing it all. It's been great.

FROKE: The date is the 12th of September, the year 2000. We've had a great time visiting with Glenn R. Jones, one of the truly exceptional people, not only in the cable industry, but in the entire country. Glenn, thank you so very, very much for being able to spend time with us here in the C-SPAN studios in Washington, DC.

JONES: Thank you. Brian is another example of what I'm talking about like he built C-SPAN, Leo Hindery. I mean, you can just go on and on. It's been a great ride.

FROKE: Thanks again.

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Cable television pioneer Glenn R. Jones dies at age 85
- The Denver Post
    July 7, 2015

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Testimonials

Much has been written of Glenn's involvement in the Cable and Education industries. Fewer people know that he also built a successful Radio business. Starting with his acquisition of a radio syndication company in 1991, he transformed a small company by injecting new ideas and support. By the time Jones Media Group was sold in 2008, it had become the leading independent Radio Network in the business. I was fortunate to have had the opportunity to run Jones Radio Networks Denver operation for many years prior to that sale. Glenn stuck with what was a tenuous business (at first) as we changed our model to all barter, and quickly became the leading provider of 24/7 Formats to the radio industry. He believed in his people and their abilities and was a huge contributor to the success of the business, even though he had no experience, per se, in radio. Perhaps that was our advantage, since radio is such a closed society. It took someone from outside to break some molds and do things the rest thought couldn't be done. We beat ABC Radio, Westwood One and others at their own game. As Greg Liptak used to say, "A bunch of cowboys in Denver". Thank you sir. Your imprint on our industry will last forever. YOU may leave US, but YOU will always belong.
— Phil Barry

Glenn was a super entrepreneur and manager but what made him unique and successful was his vision, persistence and tight focus. He had a vision for each of his businesses and provided the appropriate "steering" to make certain they stayed on course. He was a great humanitarian and a good friend. He will be missed by his colleagues, employees and alums.
— Wally Griffin

During my time at Jones Intercable, my interactions with Glenn spoke volumes to the kind of man he was. One day as I struggled through a signal problem in Glenn's office, I felt a hand on my shoulder. It was Glenn. He handed me a cup of coffee and said, "Take a break, Mike. You're getting too wound up about this." There I was, in my CEO's office and he's bringing me coffee. Glenn brushed aside my thanks for his courtesy and concern, and then told me to have a good day. A few years later, after knee-replacement surgery left me hobbling on crutches for a few weeks, Glenn stopped me outside of the Uplink to tell me "...get a second opinion if you're not happy with your care. If the insurance won't pay for it, we will." When it came time for me to leave, Glenn told me what he had told so many others: "It's about what's best for you. You may leave us, but you will always belong." Cable has lost one its best leaders. And those of us who are Jones alumni have lost a friend and mentor. We miss you, Glenn.
— Mike Snyder

Glenn Jones was one of the most special friends in our lives. Both Glenn and Dianne are always in our thoughts.
— Bernie and Toni Luskin

Those of us who knew and loved him, recognized that Glenn was one of those unforgettable characters. Toni and I have great affection for both Dianne and Glenn. We worked on many projects together. Most were efforts to bring his visions to reality. He was the best lawyer I ever worked with, and I say this because he had such extraordinary insight. Plus, I know Glenn to be among the fairest and most honorable friends I have had. Mind Extension University, Jones Education Networks, Jones International University, Jones Entertainment Group were all dreams who had their moment in time and personified the vision we shared.
Glenn generally did it his way.....and his way, was also my way. Toni and I will miss him.
— Bernard Luskin

I have endless memories, and even more gratitude, for having worked at a number of Glenn Jones' companies. Glenn was truly a "captain of industry". While he built many businesses, far more impactful than that, he built an organization of leaders, risk-takers, envelope pushers and dragon slayers. I was so fortunate to have stumbled into his company in 1985 and, through good times and bad, he always saw the possibilities of what could be, and never simply what was. I learned more, tried more and cared more in 13 years there than most people get to do in their entire careers. I am grateful for my last personal conversation with Glenn at our last Jones Companies "reunion" in April. I was gifted with the opportunity to tell Glenn exactly what was on my heart and how he had made me a better executive, entrepreneur, co-worker and subordinate. Jones Intercable was like a "business Camelot": collegial, congenial, fair, fun, and daring. His legacy lives on in the thousands of people who went on to be better people because, once, they worked for him.
— Jim Honiotes

Glenn embodied being a "lifelong learner" and enabled so many others to achieve their dreams by bringing education to the desktop. He was a true visionary. I remember a speech he gave at one of our last company meetings at Jones Intercable down at the Broadmoor. He said something like: "My only regret is that I don't have 25 more years to keep doing this, because technology has gotten so sophisticated -- there's so much more that can be done." He set a high benchmark for the up-and-coming telecom generation.
— Jean Duane

My time at Jones Intercable was period of personal and professional growth far beyond what I could have imagined. Because of Glenn's passion for learning and giving his associates the tools they needed to grow, including education, I realized my long-term dream of getting a Bachelor's Degree; something that wouldn’t have happened without Glenn’s help. Glenn empowered people by helping them reach further and higher than they ever thought possible. His passion for people was also reflected in how he treated his associates on a day to day basis. One day as I struggled to fix a signal problem in his office, Glenn personally brought me a cup of coffee and told me to take a break. There I was in the office of one of Cable's best known CEOs and he's bringing me coffee. When it came time for me to move on, Glenn was as magnanimous as ever, telling me, "You may leave us, but you will always belong." What an amazing and caring man Glenn was. The industry has lost one of its best. I offer my deepest condolences to all who knew him.
— Mike Snyder

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Tom Jokerst

Tom Jokerst

Interview Date: Thursday October 06, 2005
Interview Location: Denver, CO USA
Interviewer: Kristin Van Ormer
Program: Share Your History
Note: Audio Only

JOKERST: Hi, I'm Tom Jokerst, chief technology officer of Broadbus Technologies. Broadbus Technologies is based in Boxboro, Massachusetts, although I am currently housed in St. Louis, Missouri, which is my home, and actually commute frequently, rather frequently, courtesy of American Airlines, to Boston and to the Broadbus office. There I'm chief technology officer and responsible for their architecture and product direction and building the world's largest, most scalable video server. So the application is directed at video-on-demand opportunities leading to television-on-demand through the use of the architecture that Broadbus has developed. It's an extremely scalable, solid-state, memory-based video server, and so it's purpose built specifically for that application with carrier class qualities.

So prior to Broadbus, maybe I can just go back and talk about the cable industry, how I got into the industry, it's a long time ago, 1971. I had finished a program at Southern Illinois University in electronics technology, and prior to that I'd completed a program at Rankin Technical Institute in St. Louis in communications, electronics, and computer technology, and still hadn't found exactly what I was looking for so I went back to school for more education, and interestingly enough, I was talking with the university placement service about career opportunities, and they actually had two, one of which was this thing called cable TV, and I really didn't know much about it or really what it was; and another opportunity with a company called General Telephone Electronics, GTE. The one opportunity with GTE was microwave transmission engineering, and this other thing, cable, they were looking for a video engineer to help them in their local channel, what they called local origination, which I had no idea of what the was at the time, and strangely enough, to be honest, and this really is the truth, I flipped a coin. I flipped a coin and it was heads cable, tails telco, and so it came up heads – because they were both good opportunities. I didn't really know which direction I should take and it seemed like the only appropriate thing to do. So I joined a company called, locally it was called Carbondale Cablevision. This was Carbondale, Illinois, and the cable system was actually just being built at that time. It was under construction and it was being built there in Carbondale, as well as a nearby town, Marion, Illinois, and these were RCA turnkey jobs. So RCA Corporation was responsible for all of the outside plant construction and engineering, and they were kind of the main contractor. I was brought in to help develop the local channel, the local origination. So I was essentially the video engineer for that operation, and we were kind of ahead of CNN in our time. We were actually out with half-inch, black and white at the time, but half-inch portable video cameras doing local news and community events, and we would get those. High school events, things like that. We even created our own rock-and-roll revival show, Carbondale being a college town, it was very popular at one of the bars to have a rock-and-roll revival, and the owner of the bar and the head of this particular show pulled up on the stage on a motorcycle and gave his MTV like opening. And in fact, one of the people that was involved in this later went on to found the MTV networks.

VAN ORMER: Who was that? Do you remember his name?

JOKERST: Yeah, it was Nile Henson, a good friend, and Nile did a lot with Gus Hauser, interestingly enough, and with Warner Qube in Columbus, and later MTV Networks. So this was Nile's brainchild. So we had a lot of fun. We did things that hadn't been done before in the local community there, and I continued doing the video engineering, but at the same time because I was probably the only one in the operation that had a formalized background in electronics technology I was getting tapped to help with system related problems, trouble-shooting, fixing problems that the other folks couldn't fix. So I found myself being pulled from the video engineering over into what I would call the core cable side of things, so the headends, the outside plant. The next thing I knew I was appointed the chief tech for that system, and then shortly after that the chief tech for the other system, and this was an area that I would call I was learning from the end of a fire hose. There was a lot going on, a lot of technical challenges with building this particular system and some of the peculiarities it had, particularly direct interference, without the benefit of a classic set top converter. So I learned a lot about how to mitigate interference and TV receivers, TV design. So I had a lot of good practical experience; I learned a lot of things because I had to, and there wasn't anyone else there on staff that I actually had to draw from a resource standpoint, so I was kind of the person that was providing technical direction. That was a great experience, and it was great learning. It was required, it wasn't optional.

VAN ORMER: Was all the equipment you needed to fix some of those problems readily available?

JOKERST: You know, strangely enough, particularly back on the video side, something that we needed in those days that wasn't available was something called a time-based corrector. Because we were using a half-inch video, the time-based stability of the video was not equivalent to broadcast standards at those times. So that's something that we actually created a work-around to, and we actually scan converted the video, so we essentially shot a picture of it with a high resolution camera with a high resolution screen and kind of circumvented that issue. So we worked around it. Today, even 20 years later, the problems... that was a kind of a, oh, yeah, we knew about that, we developed this, we fixed that, and moved on, but at the time we had to come up with a creative way to do it, and the electronics, I would guess you'd say the actual microprocessor and miniaturization hadn't developed to a point where that was a practical solution at that time. But my constant being pulled from kind of the video engineering role to outside plant and headend issues increased, and I found myself going from that location to other system locations that this small MSO owned. This MSO was a New York based company called Cable Information Services. They had systems in Illinois, but also in Oakridge, Tennessee; Fort Rucker, Alabama; Winchester, Kentucky; Hobbs, New Mexico; Logan, West Virginia. So I found about this time regulation hit the industry, particularly from the standpoint of technical regulation. So I found myself going around, running FCC proof of performance tests, helping systems pass those tests, doing headend realignments – pretty much a field engineer type role. Again, a great opportunity to learn things, see how different cable systems have been built, and what not to do, in many cases, going forward. So I learned a tremendous amount about how to build systems by seeing how they were built and how you wouldn't do it again if you had a chance to do this over. So I was with that company for five years, and kind of the last few years I was in a location in Winchester, Kentucky, which were, from a personal standpoint, two of the happiest years in my cable life just because it was a great location, beautiful part of the country, very, very nice people, and you could do a lot and your efforts showed. So that was two of my favorite years in the industry. Shortly after that I finished up there and actually had the opportunity to come back to Carbondale and learned a valuable lesson there, and that is you don't go back because I actually did come back to the role that I had left, saw how things had changed, lots of things you had set in place weren't maintained, and core values that you helped establish were diffused and diverted and changed. So I kind of... not long after I was there an opportunity came along to join Continental Cablevision. This would have been about 1976, and starting out in Quincy, Illinois I was director of engineering for a gentleman named Jim Wand, who was a great guy, and we had a number of systems that were existing locations, lots of microwave interconnectivity, CARS-band microwave, some of the very early deployments in the cable industry with CARS microwave technology. So part of my responsibilities was the engineering and management of those networks as well as kind of the chief technology guru and troubleshooter. So we had a group of systems from central to northern Illinois that I took care of, and we did that successfully, built a couple of new systems for them in Pekin and Morton, Illinois, and started about that time – this was 1979 – and satellite technology had hit the industry in a major way. We had had several good years of introducing a pay-per-view service, pay channel, actually, called CineView. It was Continental's own program, and they had made their own arrangements for rights and movies, and it was a tape-based system. I kind of had the reputation in the company at that time for actually having the deployments that had the best picture quality, and it was because, again, my background was video engineering, I knew some tricks and techniques to apply to ¾ inch video cassettes at the time. So we were able to share that... Continental at the time didn't have much of a corporate staff at all, it was a very decentralized organization. In fact, it was decentralized before decentralization became cool. So that was a lot of fun, and again, learned a lot. Great, great people, a very strong culture, which was work hard, work smart, play hard, and kind of the core elements were taking care of the customer, taking care of the employees, taking care of the business, so those things were instilled in a strong way from the top down. So it was centrally managed from a financial standpoint, but beyond that it was very decentralized. So about 1979 we started understanding that franchising in the major metropolitan areas was happening, and Quincy, Illinois is about two hours from St. Louis, and so we started making trips to St. Louis, Missouri, looking around and seeing what opportunities were there for franchising. Late in '79, I actually relocated to St. Louis along with Mr. Wand and his marquis staff from the regional office in Quincy, and we franchised a significant portion of the St. Louis market. There was something like over 92 different communities that were either separately or in conjunction with other consortiums going to award cable franchises, so it was a feeding frenzy, and we were in there doing everything that we could do. One of our chief competitors was Warner Qube and the Qube system, and they got a sizable portion of St. Louis along with Sammons at the time, Storer, United Video, and then later, much later, TCI got the city of St. Louis. So from '79 through I'd say '85, thereabouts, we were busy franchising and then building those metropolitan markets. Probably did that really through the decades of the '80s to the '90s, and around 1990... and during this time I had been active in the SCTE and active in NCTA and CableLabs. I tended to be the kind of de facto representative for Continental on the NCTA engineering committee and CableLabs technical committees, and through some of my work at CableLabs, I was invited to participate in and executive on loan program that they were facilitating where key personnel from an MSO would spend two years at CableLabs on loan and then go back to their company. And so the timing was good; we had largely finished the St. Louis market, there wasn't anything else to franchise. Not that I was looking for things to do, but the timing was good, and so my boss was approached by Dick Green from CableLabs to see if I would be willing to be loaned out from Continental to CableLabs for two years. So I maintained my residence in St. Louis, but I basically packed my bags and moved to Boulder for two years, from 1991 through '93, two of the other great years in my cable life, particularly from a learning opportunity, also great people. I fell in love with Colorado, which that's good and bad because it's good when I'm back here, but it's bad when I'm thinking about how humid it is in St. Louis and it's not in Colorado. So at CableLabs I was vice-president of the Office of Science and Technology, and in that role I actually was kind of the cable guy for CableLabs, someone who could bring practical, relevant information to the labs and say these are the kinds of things we need to be working on, these are important, these aren't quite so important, and do that kind of on behalf of Continental and on behalf of the industry. And I think I was... I really don't recall now whether it was before or after that time, I actually think it was after that time that I served as chairman for the NCTA engineering committee, but those actual roles actually complemented one another, and one of the things that when I was at CableLabs that I got involved in that I really enjoyed, and I think it was important for the industry, was evaluation of various digital video compression algorithms and transmission technologies to really see where the industry can take and apply digital video compression technology for advanced services and to increase its service offerings to its customers. So a significant part of my job was involved in doing just that, so that was a lot of fun. I interfaced a lot with the consumer electronics industry out of Japan, made a number of trips to Japan, and also had an opportunity to visit China on behalf of the Labs and lecture to cable engineers in China, so that was quite fun. The other experience that I had at CableLabs, and one thing I'm happy about and proud of, is that I helped bring to commercial deployment an impulse noise reduction system that was used by headend operators, cable operators, in lots and lots of places to do what you would think is not possible, which is eliminate interference out of a picture without actually eliminating the interference. So we could actually take little sparklies and dots, remove it from the video, and substitute it with video that was right next to where it was without, largely, people being able to tell the difference. So you could take a customer who was very unhappy about a picture because the operator was receiving it over the air with electrical interference, which was caused by a power line somewhere, which they had no control over, and you could actually insert this box, remove it, and deliver a clear picture. So that was something I did kind of as a skunk work project at the Labs, and we surveyed a number of different technologies and actually found a little garage shop in Pennsylvania that did something that was just unbelievable. I spent time at the Sarnoff Research Institute looking at impulse noise reduction technologies using neural networks, which was an approach that they'd pioneered. This guy came in with his weekend's worth of work and completely blew away their simulation. So we knew which horse to ride, kind of pointed him in the right direction, and the product became a commercial success and solved some problems for the industry. So lots of things like that at CableLabs, so those were two great years. At the end of '93, I moved back to St. Louis, and the opportunity to join Charter Communications presented itself. So in the early part of, actually late '93, early '94 I joined Charter Communications. I was the 12th employee. We had no customers at that time, but had a dream and a vision, and the dream was to build the company up to a couple hundred thousand subscribers.

VAN ORMER: And you accomplished that!

JOKERST: We accomplished that, on to a million, on to a couple of million, and somewhere along the line, a gentleman named Paul Allen decided he wanted to acquire Charter, and he'd previously acquired the Marcus Communications properties, so we mixed Charter and the Marcus companies together through Paul's acquisition, and up until that time I had been Director of Engineering, or Senior VP of Engineering and Operations at Charter, and this afforded me to take on a new role, which was Senior VP of Advanced Technology. So looking again at advanced applications, new services, so things like delivering internet via the television platform, not to mention high-speed data, video-on-demand, all those kinds of things, advance set top boxes, looking at hard drives in set tops, all of the things the industry's pretty much doing now we were pressing on back in the '97-'98 timeframe. So that was a lot of fun. During that time, Charter became public, and that was an interesting experience, and it changed the dynamics of the company. You started managing more quarter by quarter and year by year, as opposed to really looking out. It just simply is different as a public company. So I had a lot of great years at Charter. We did a lot of good things, and I had an opportunity to transition from Charter, and I did that. So I actually became a senior technical advisor to them for a period of a year, or it was actually between a year and two years. During that time I met a gentleman named Jeff Binder, who had this idea about a video server, and I had actually led the team that evaluated the various video-on-demand deployment options that we had a Charter, and so I was very tuned up on what requirements are and what was missing from the video server architecture, and when I met Jeff, and this was actually at CableLabs Silicon Valley Summit that CableLabs and Tony Warner had actually sponsored, Jeff gave his vision for this video server platform, and it was spot on in terms of what the industry needed, what the other architectures were lacking, and I got excited. Over the years I'd had lots of ideas for products and lots of companies approach me for things, but I got very engaged with Jeff and the people, Bob Scheffler, at Broadbus, and at that point I didn't realize that these guys were start-ups and hadn't got funding and basically had a great idea and some intellectually property but really weren't ready to deliver a product yet. I needed to buy a product. So I kept holding off making a second vendor decision thinking that this Broadbus thing was just around the corner, and that didn't happen and didn't happen, and so we finally had to make a decision at Charter to go with a second vendor, which that happened and it took care of itself in time. But this guy named Jeff Binder kept calling me and saying, "Why don't you come help us bring this thing to reality?" It was actually the first one of many of those kinds of calls that I had that I actually seriously considered. The plan was to locate the company in Colorado, which appealed to me because it was a great chance to get back and spend time in Colorado, and it was an area that I believed in, and a technology and an architecture that I knew made a lot of sense, so that was appealing. Jeff was a fun guy, and a fellow guitar player, so we had something in common there. So he ultimately talked me into it. My requirement was that I still wanted to maintain my primary residence in St. Louis, but I really didn't care how much I traveled, so that was kind of ideal, and so I joined the company, helped them actually get funded. So we got funding through two world class venture capital firms, Battery Ventures and Charles River Ventures, both Boston based, and they had the foresight and wisdom to say, "We think you guys should locate in Boston instead of Colorado," and while we weren't thrilled with that, it ultimately became clear as to why that was a good idea, and we did, and we've been successful to date, and things are going well. We're delivering a product that's working as promised and that our customers to date are thrilled with. That all is very positive, and that's kind of the story. Certainly not as dramatic as I'm sure a lot of the folks that you've talked to, but that's kind of a synopsis of how I got to where I am, and it's been fun and I continue to have fun. So it is a business that gets in your blood and that you want to stick around. Certainly the social and people aspect of it, it's got great characters and great people that are fun to be associated with, a lot of good organizations.

VAN ORMER: What do you think cable's primary strength is that's going to carry it forward through this time of transition and change?

JOKERST: Well, I think one of the key ones is that we've been successful in bringing the market to this point, and with customers and we've actually created the programming that built this industry, and we did it on our own capital with our own resources, and fairly or unfairly is a separate debate, but we were forced to give up that property which we developed to other competitors. So that makes life a little difficult from the standpoint of creating competition. We've certainly done that, and we've enabled competition by letting our competitors have the programming that we actually funded and worked hard to develop and bring to market. We're not going to go back and change that. Going forward I think we need to keep doing the same kinds of things. We need to keep developing services that consumers want to buy. We've clearly done that with high-speed data. Clearly it's being done today with voice-over-IP. Having the real time two-way capability on the video platform is a huge advantage. That's one that we're just now really starting to tap with services like video-on-demand, but really leading the industry to television on-demand, to where people can... and the vision I'm going to give you right now is a little down the road, but basically if there's a program episode of a program that you would like to see, you go in, you find it on the navigator, and you click on it, and either instantly or within a few seconds you're watching it. I think that's a service that satellite cannot easily offer for quite some time, if ever. It's clearly something we've got the technology to do now. We've really got all the piece parts we need; it's a matter of putting those piece parts together and getting willing program providers to work with us to do that.

VAN ORMER: Great. Well, Tom, we need to wrap up, but thank you so much for coming in and sharing your experience.

JOKERST: Kristin, it was my pleasure. Thanks so much for the invitation.

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Robert Johnson

johnsonRobert5

Interview Date: Tuesday June 17, 2003
Interview Location: Washington, DC
Interviewer: Briam Lamb
Program: Hauser Project

LAMB: Bob Johnson, in this interview for The Cable Center in Denver in the oral history, can you remember back to the very first moment you thought of doing something on television, in cable?

JOHNSON: Yeah, I can probably remember the time when I thought this was something that I would want to do and it would be between... I was at the NCTA in probably the latter part of '79, when I would go to the conventions and see all of these new channels, these targeted channels cropping up, these niche channels, and it occurred to me at some point in time somebody was going to start a channel targeted to African-Americans and I was sort of in the back of my mind concerned that it might not be me, and that sort of drove me more than anything else is that sort of "why not me?" And that's when it started to sort of become a passion, if you will.

LAMB: What was your job at the NCTA then?

JOHNSON: I was vice-president of government relations. My principle job was to lobby for de-regulation of pay TV. You remember the old pay TV rules that they had at the time, so because of that I got a chance to know all of the guys who were involved in programming development, as opposed to being so close to the operators, although ironically, the guy who ended up helping me the most in making BET possible with me was Dr. John Malone, an operator, but my first assignment was to be associated with guys like Ralph Baruch and Jerry Levin and Russell Karp and Bob Rosencrans, who were sort of the programming wing, more or less, of the industry.

LAMB: How long had you been at the NCTA in '79?

JOHNSON: I started in '76. I got in the industry... it was just sort of fortuitous. I was living over in southwest DC at the time and went to a party at a next door neighbor's house, and was talking to this woman who we got to talking and she said, "You know, you'd make a good lobbyist for the cable industry." I said, "I don't know anything about cable." And she said, "Don't worry; when I got in I didn't know anything about it either."

LAMB: Who was it, do you remember?

JOHNSON: Yeah, it was Bob Schmidt's secretary.

LAMB: What was her name?

JOHNSON: I want to say Carol, but I'm not certain. But she said, "I'd like you to meet this guy named Bob Schmidt."

LAMB: Who was doing what then?

JOHNSON: Bob, at that time, was president of the NCTA.

LAMB: And you were doing what then?

JOHNSON: I was a lobbyist. Excuse me, I was press secretary for Walter Founteroy at the time.

LAMB: And who was he?

JOHNSON: Founteroy was a congressional delegate for the District of Columbia, and I'd been with him since '73, and so about that time I was looking for a change of career, if you will, to sort of pick up another stripe. I worked for the Washington Urban League so I felt I had the social community kind of background. I worked on Capitol Hill as a press secretary for three years, so I had the political stripe, but I didn't have any business background, didn't have a business sort of a focus. So, I felt that gee, cable gave me both; there was business and the politics of lobbying for cable de-regulation, so when she mentioned the cable industry I said why not meet with Bob Schmidt? I met with Bob Schmidt and I think we met for like an hour or so up on Capitol Hill and he offered me the job as vice-president of government relations. He not only wanted to have somebody to lobby, but Bob had a strong commitment to minority opportunity and employment in the cable industry, so he hired me and I got my first job. It was a year of pay TV, and so I was in the middle of programming just like that.

LAMB: This may sound like an odd question, but how important was the fact that you were an African-American at that stage in your life? How much did you think about, and then, of course, it obviously leads to why a channel. But shape the world then for people that were African-Americans.

JOHNSON: I didn't think about it in terms of I'm an African-American, ergo there follows some major mission in life because I'm black, but I recognized that as an African-American, I had to seek out opportunities in areas where African-Americans had not yet gone and cable was one of those. There were a couple of African-American guys who'd worked in the Cable Association before me, Don Anderson being one, and another gentleman by the name of Sam Shepherd, I think, but I felt that here was sort of virgin territory for someone who was African-American to sort of pursue a career opportunity in a way that no one else has done. And so it was an opportunity sort of laying out there for me, the way that I looked at it, and I felt what I had to do was to sort of be very effective, get to know the people in the room in a way that if I impressed them I would have other opportunities to do business with them or to form relationships with them. That was my thinking at the time, and then as the technology issue began to come to the surface – satellite cable, the marriage of satellite and cable – then it sort of hit me, "Aha! Here's a chance to create something in the form of a content based business." But it was more, "Gee, I'm in cable, I don't see a whole lot of blacks in cable. Here's a chance for me to be first in position to benefit from that."

LAMB: Again, this is a very personal question, you may not want to answer it – how much money were you worth in your life in 1979?

JOHNSON: In 1979 I was a lobbyist for the NCTA, so I had a salary probably somewhere in the low 70s at that time, had my own home...

LAMB: Owned it or buying it?

JOHNSON: Buying my own home, and had a car I think I was paying a note on, and no savings at all, and that was it.

LAMB: Family? Were you married, and did you have children?

JOHNSON: Married, and I didn't have any children.

LAMB: How old were you in 1979?

JOHNSON: '79, you've got to go back almost 30 years, so 27.

LAMB: Where had you gone to school?

JOHNSON: I went to school at the University of Illinois and got an undergraduate degree, and then went to graduate school at the Woodrow Wilson School at Princeton and got a Masters degree in International Affairs.

LAMB: What did you study at the University of Illinois?

JOHNSON: I was a history major. I got a degree in social studies, teacher education.

LAMB: What kind of a student were you?

JOHNSON: I was a good student. I graduated with honors in history from the University of Illinois. I did very well. I didn't have to study that hard, at least I didn't feel like I studied that hard. So I would say I was a good student, and in fact, the way that I got to Princeton was that I was sort of invited to be part of a Ford Foundation program to attract minorities into the foreign service, and the program was that if you completed the program satisfactorily, they would pay your way to any foreign affairs school that would accept you, and so I ended up going to Princeton.

LAMB: What city were you born in?

JOHNSON: I was born in Freeport, Illinois, a small town about 100 miles northwest of Chicago, the closest big city is Rockport, Illinois. Home of the famous Freeport Lincoln-Douglass debates, which you know a lot about.

LAMB: And what date were you born on?

JOHNSON: 1946.

LAMB: The day?

JOHNSON: 8 April.

LAMB: And your parents were like what?

JOHNSON: My parents were mainly basic factory worker people who had a fundamental strong belief in education; my mother had a strong religious background. She, I think, had a background as an elementary school teacher in the south. She didn't teach when she came north in the early, just a little bit after I was born, say, so '49 maybe, because I was about three years old when I moved up from a small town in Mississippi called Hickory, Mississippi. My parents always worked in factories in Illinois and led a basic working class kind of family life.

LAMB: How about brothers and sisters?

JOHNSON: I have nine brothers and sisters. I was number nine of ten.

LAMB: Are they alive today?

JOHNSON: All but two.

LAMB: And what's your relationship with them today?

JOHNSON: You know, it was a big family and when you have a big family that grows across the spectrum over ten kids some you're closer to than the others, so I think that sort of describes the relationship. The ones that are younger I'm probably closer to than the ones who are older.

LAMB: Back to 1979, you had no money in the bank. What was the situation in the cable business in 1979? How many channels were there?

JOHNSON: You know, when I always thought about cable at that time, it was still cable as a strong retransmission product, but also growing towards programming content. So you were looking at a 30-channel cable system, most of it made up of off-air signals and some stations that were carried in, long distance signals brought in from outside the market, and in most cases, obviously some local access channels of that type, but you began to see just under the surface the rise of basic channels and of course pay channels, but the programming was pretty much we're selling broadcast programming with better reception, local origination, and the idea of antenna service.

LAMB: Can you remember the first person you might have sat down with – you're at the NCTA working for Bob Schmidt, a vice-president, and you sit down with somebody and say, "I want to start a channel for black Americans."

JOHNSON: I think the first person I started talking to about that was a guy... I can't think of the guy's name, but he was associated with Clive Runnels in Houston, because at that point Clive and those guys in Houston were building what was called a futuristic cable system, that they were going to wire the homes both with cable and burglar alarm systems and everything else, so they were sort of open to a lot of channel carriage because they were supposedly building this system with a lot of capacity, and Houston being somewhat of an African-American market, it sort of occurred to me I should meet this guy. The guy's name, for some reason I think it was Mickey Riordan, or something like that.

LAMB: It's not Gardner, was it?

JOHNSON: I don't think so. I knew the guy because he was a financier type, and I sort of told him about my idea and talked about it to see if he could help me put together the money for it and everything else. Well, ultimately it didn't happen, and then as I started to get more and more focused on the idea, I started talking to two people – Bob Rosencrans and John Malone.

LAMB: And what did each one of those contribute?

JOHNSON: Well, Bob was first of all a very sympathetic guy to young people with ideas that he wanted to help and support, and he had a dynamic executive named Kay Koplovitz who was working there with him, and so she was also a programmer in orientation. So he was willing to help me get on the satellite to get carriage, and I remember this, I'll never forget this day: Bob was testifying up on Capitol Hill – I was still a lobbyist at the time – Bob was testifying on Capitol, he was making a presentation, and my job was to be the hand holder staff guy.

LAMB: Can you remember what date it was?

JOHNSON: I can't remember the exact date, Brian, but it was somewhere before BET went on the air in 1980, so it's got to be somewhere in '79. Congress was in session, so it's during that period of time. So Bob goes up and delivers his testimony, or he's got a break before he goes to testimony, and I say, "Bob, can I talk to you a moment?" He said, "Sure, we've got a break. I'm going to walk down to the men's room." So we walked down the hallway in the Capitol, and I started talking to him about this idea for BET. I said, "You know, what I really need is access to satellite. I think I can get the programming, I think I can get the cable operators to carry it." He said, "Okay, that's something I think I can help you with. We can probably put you on in the back of our Madison Square Garden satellite. How many hours do you need?" I said, "Can I get just a couple hours?" And that's what we agreed, that he would give me Friday night at 11:00 PM on the back of his satellite time.

LAMB: Do you remember what he charged you?

JOHNSON: I don't recall, but it probably was somewhere in the neighborhood of $200-$250 an hour, something like that. It wasn't a lot of money in that sense, looking back on it, but at that time it was, when you multiply that times 52 weeks, it started getting up to be some money.

LAMB: But you were still full-time with the NCTA?

JOHNSON: I was still full-time with the NCTA at that time, so that sort of got it going, and then later on, there was another encounter on Capitol Hill with a guy named Ken Silverman. Ken Silverman wanted to launch this channel for the elderly, and he asked me, again as a lobbyist, to accompany him to Capitol Hill to introduce him to various Congress members. He particularly wanted to meet Claude Pepper. Claude Pepper, former Congressman from Florida, chairman of something called the Select Committee on Aging in the House. So we were going to meet Claude Pepper, figuring he would be, obviously, supportive of this idea for the elderly. So riding in a taxi up to Capitol Hill, I said, "Ken, can I see your proposal?" He and I had been friends because he was also in the pay TV world with a company called CineAmerica, and he showed me his documentation and he had these statistics about the elderly. The elderly have certain living patterns, they buy clothes based on their demographics; they consume certain kinds of foods; they save in certain kinds of ways; and they spend in certain kinds of ways. I said, "Gee, Ken, you could say the same thing about the black community. The black community has certain buying habits; they have certain kinds of consumption patterns; they buy certain products; they have a certain kind of disposable income. Can I use your information?" He said, "Sure." So wherever Ken had elderly, I simply – when I put together a proposal – crossed it out and put "black", and just sort of augmented it with some information about blacks. That was the basis of a business plan for BET. There was never a whole lot of research done on it, not a lot of analysis, it was sort of taking the concept of it and doing the same thing – target demographic, elderly; poorly depicted on television; specific kinds of consumption patterns – it just mirrored the black community.

LAMB: Do you have any idea where Ken Silverman is today?

JOHNSON: No, I don't. Every now and then... he called me, oh, it was about three or four years ago, maybe a little longer, he called me, he had some idea he was trying to get across and he used his "gee, Bob, I helped you, can you help me" kind of thing, and I think I either invested a little bit of money or gave him a little bit of money to do something, but no, I don't know where he is today.

LAMB: But he never got the channel started?

JOHNSON: Never got the channel started. He tried. At one point he had backing and then the backing disappeared. I think a lot of people liked the idea. Kenny, I think, just wanted to make sure he held complete control over it, and he never could reach an agreement with any of the MSOs or any of the other investor types, because he unfortunately didn't meet a guy like John Malone.

LAMB: That was also in '79?

JOHNSON: That's all in '79.

LAMB: John Malone. How much did you know about John Malone being at the NCTA before you approached him on this?

JOHNSON: I didn't know John at all. As I say, my principle lobbying role was with the programming guys, so I knew Ralph Baruch much better than I knew anybody.

LAMB: And what did he do?

JOHNSON: Ralph Baruch, at that time, was the CEO of Viacom, and he was somebody I knew very well, both Ralph and his wife, and so I was more into the programming guys. But Malone was somebody, and I can't recall exactly how this happened, but I do know that I was at a board meeting, John was on the board, and I just happened to be talking to him and I said, "John, I'm thinking about doing something in able." He said, "Bob, if you ever get an idea, call me." John, as you know, is not the most glad-handing, open guy in the world, he's kind of reserved, and you kind of approach him with a little bit of trepidation. He's not like some of the other guys who I established much stronger relationships with as board members, like Bill Strange, who as you know, was the most easy-going, talkative guy in the whole industry; others in the industry who I can recall, who I got to know real well, Frank Drendel, and people like that, who are all what I call good friends. So when you start thinking about Malone, you don't think of him as the guy that a young staff guy approaches easily, and then with his orientation being more of a political conservative, mine being a background of a liberal Democrat African-American, you would think that there would be not much of a connection, but as it turned out, there was. John just happened to be able to say "people I believe in, I'll support" and fortunately for me, he believed in me. So when I finally got around to saying I'm going to do BET, I first made the rounds of some black business executives thinking that I wanted to have them involved in the deal. I talked to some black advertising executives about buying in because I figured they had relationships with Madison Avenue advertisers who target black consumers, and I would sort of use that way to approach the deal, but I couldn't get an agreement at that level. So finally one day I called up John Malone and said, "I'd like to come out and talk to you about it." So I went out and talked to him about it...

LAMB: In Denver?

JOHNSON: In Denver. They were in the old TCI building, the one with the fake plants. So I went in and I started talking to him about this concept, and John, interestingly enough, when we talked about it had the cable system in Memphis, Tennessee, shared with ATC, I think, at the time, and they were looking for ways to get programming in to sort of augment their franchise proposal and to be able to say we're going to bring more programming in. He said, "Hey, you know this idea of putting programming on the satellite would help me solve my distant signal problem. So, yeah, if you can get programming... can you get programming?" I said, "Yeah, I think I can get programming." He said, "Well, if you can get programming, I think I'd be interested in helping you out, being your partner in the deal." I said, "Okay, when I come back to you with something I'll lay it out for you."

LAMB: Still in '79?

JOHNSON: Still in '79.

LAMB: Let me jump ahead just a little bit. The first day you went on the air, what was the date?

JOHNSON: The first day we went on the air was January 25, 1980.

LAMB: How many hours?

JOHNSON: Two hours a week, Friday night.

LAMB: What did you have on the network?

JOHNSON: One movie and gospel programming.

LAMB: And the movie? Do you remember what it was?

JOHNSON: Yeah, it was something called A Visit to a Chief's Son. It was a movie about an African boy and his father who met up with a white safari hunter and his son, so you had two fathers, two sons, and they meet together during this African safari and they learn each other's culture and build a relationship. I thought it was a good kind of movie to put on because it would send a signal to the cable industry that I wasn't going to be putting on radical left-wing black power programming. So it turned out to work.

LAMB: What did it cost you?

JOHNSON: Gee, I don't know, I think for that film we were paying $500 a title, maybe $1,000, I don't know. It's hard for me to remember.

LAMB: What was the gospel music?

JOHNSON: Bobby Jones' Gospel. It was just basically video clips of gospel programming.

LAMB: How long?

JOHNSON: It was about an hour.

LAMB: And so you had offices where?

JOHNSON: Offices at that time were over in Georgetown on Prospect Street.

LAMB: How many people worked for you?

JOHNSON: We had maybe five or six people.

LAMB: Who were they primarily?

JOHNSON: My sister worked for me at the time, I had a secretary named Carol Kooti who worked for me at that time, and some other... I had a secretary named Beverly. I don't remember if Vivian Goudiet worked for me early on, I think she came on later, but she later came on about a year or so later, after she left the NCTA.

LAMB: How long did you only have two hours?

JOHNSON: I had two hours for about six months and then we moved to four hours, Friday night and Saturday night.

LAMB: How many cable systems were hooked in that first night?

JOHNSON: I think on the first night we launched we launched off the back of MSG, so whatever Madison Square Garden had... I think at that time, interestingly enough, when we launched with 3 million subscribers we had the largest subscriber launch of any programming service in the country because we were piggybacking on Madison Square Garden Sports.

LAMB: What did you charge?

JOHNSON: Nothing. It was free at the time. We were just anxious to get carriage. Cable operators were anxious to put us in their portfolio because it was designed to help them attract franchises in cities, so the operators were willing to carry it, but the programming was free, plus we were piggybacking on MSG.

LAMB: Where did you uplink from?

JOHNSON: We uplinked the signal out of Virginia, but I think it went down again at MSG and then they put it back up again.

LAMB: Did you rent studios or rent facilities?

JOHNSON: Yeah, we leased some facility out in Virginia from an organization, from a company.

LAMB: How much money did you have in the bank and where did the money come from?

JOHNSON: Well, the company at that time when we launched had been capitalized with the half a million dollars from John Malone. Now, prior to that, I think I had borrowed about 15,000 dollars from NBW that was guaranteed by a contract I had with the NCTA to stay on as a consultant, and then later on I got another 40,000 dollar loan from the bank. But when we really started the business, I went out to Denver after I had been talking to John Malone and I laid out basically what I wanted to do. John listened and he said, "I'd like to be an investor. How much money do you need to get it started?" I said, "I need a half a million dollars." This all took place in no more than 30 minutes. He said, "Bob, I'll tell you what I'll do. I'll buy 20% of your company for $180,000 and I'll loan you $320,000. You'll be 80% and I'll be 20%. Is that a deal?" I said, "John, that's a deal." But what John didn't know at the time, had he reversed the numbers and said, "You be 20%, I'll be 80%," I would have said, "John, that's a deal." But he didn't say that, and later on after BET had grown and got bigger, I asked John, "John, why didn't you change the numbers around where you were putting up all the money and take a bigger percentage?" He said, "Bob, I knew that you would work harder for yourself than you would for me." So, it was that level of support that he gave me. He called in his attorney, and I can't think of the attorney's name, but he called in the attorney, the attorney wrote out – John said here's the deal, this is what we're going to do – he wrote it all out, this took, like I said, took no more than 30 minutes, gave me the document, it was a one and a half page document, I signed it, he called in somebody from the finance office, they wrote me out a half a million dollar check made out to BET/Bob Johnson. It was more money than I ever knew existed in my entire life. I never knew that kind of... It was almost so much money I was scared. I would say, "Oh, something bad's going to happen. The plane's going to crash or somebody's going to rob me or something's going to happen." But it was that half a million dollars that John sort of put in my hand and gave me the feeling that this thing had some potential. So I get the check from John, and I signed the document, and as I'm leaving I said, "John, can I ask you a question?" He said, "Sure." I said, "John, I've never run a business. What advice can you give me?" He said, "Bob, the only thing I can tell you is get your revenues up, keep your costs down." That was my business 101, and from that point on, based on what John said, whenever I would run BET the budget would go like this: how much money are we going to make? And I'd say, okay, we're going to make 2 million dollars this year, then I would say, we're going to spend less than 2 million dollars, and that's the way I budgeted BET every year until it became cash flow breakeven, always spending less than what I was going to make. As we grew we had to get more money in, but it was debt money, never based on spending.

LAMB: What kind of a corporation was it?

JOHNSON: It was a regular corporation.

LAMB: Who was on your board?

JOHNSON: I was on the board; Malone was on the board; my wife, Sheila, was on the board at that time, and Ty Brown and Herb Wilkins.

LAMB: Tyrone Brown used to be an FCC commissioner.

JOHNSON: Ty Brown was the second African-American appointed a commissioner, and a good friend of mine.

LAMB: And Mr. Wilkins?

JOHNSON: Herb Wilkins was a venture capitalist who had been part of a group of minorities that were trying to make sure that minorities got more ownership in cable and he had sort of partnered with some individuals in owning a cable system out in Columbus, Ohio, with a guy named Bill Johnson, who's not relation, Herb helped him get his first cable system and also some other people around the country. So he had a telecommunications/cable investment background.

LAMB: How long did you continue to be a consultant at the NCTA?

JOHNSON: I was a consultant at the NCTA, I think that contract lasted for about six months after I started BET.

LAMB: And you said six months into you went to Saturday nights.

JOHNSON: Right.

LAMB: Two hours or four hours?

JOHNSON: Two hours.

LAMB: When did you expand? What was the progression on expansion until you had your own channel?

JOHNSON: We went for one year as a four-hour – two hours on Friday night and two hours on Saturday night – channel.

LAMB: One year.

JOHNSON: One year, and we decided that we had to get more carriage. Well, obviously, MSG couldn't give us more time, so we started looking for additional satellite time to get on the satellite. We got some more carriage under a deal with Group W. They had some satellite time, so we went on one of their satellites and we expanded to four hours a night, from 11:00 to 2:00.

LAMB: That's three hours.

JOHNSON: That's three hours, yeah. So, we went to three hours a night from 11:00 to 2:00, and eventually we decided that we had to go more hours so we decided we had to get our own satellite, and that's when we started talking to the people at RCA about satellites they were launching and I remember a guy named Andy English was head of that, and the idea was to figure out a way to get more time by getting access to satellite time.

LAMB: So when did you go full-time?

JOHNSON: We went full-time in 1984.

LAMB: When did you start charging?

JOHNSON: '85.

LAMB: You were free up until that point?

JOHNSON: We were free up until that point, yeah.

LAMB: And when did you have your first advertising?

JOHNSON: Our first advertising? When we started the network? As soon as we launched the network we got advertising. I'll never forget, when I first announced that we were going to do it, I got a call from the guys at Anheuser Bush saying we want to be your first exclusive advertiser, and I think they paid, maybe it was $100,000 at the time, to be the exclusive advertiser on the entire network, and I mean exclusive. They had every spot you can imagine, billboards, everything. It was amazing that they saw this as a way to tap into the black consumer market. Had they turned that into equity they probably would have owned a third of the network at the time, but they were the original advertiser on the network.

LAMB: Do you remember what you paid yourself that first year?

JOHNSON: Yeah, because sometimes I go back and look at my contract that I had with John Malone and I think I paid myself about, I think it was roughly $65,000.

LAMB: When did you, if ever, start thinking about money? In other words, you say you had no money in the bank...

JOHNSON: Right, right.

LAMB: You were buying your house and had a car, you were married and no children, and then this all starts. Were you motivated to get into this in the first place because you wanted to be a rich man?

JOHNSON: Not really. I was motivated primarily because I didn't want somebody else to do this. I felt that if I – within the cable industry, knew all the cable operators, saw the technology flying in front of me, had relations on Capitol Hill, had all the ingredients – I felt that I would be kicking myself for the rest of my life if I read in the newspaper that John Johnson, of Ebony Magazine, or Percy Sutton, of Inner City Broadcasting, announced that they're launching the first black cable channel, and would then be successful at it to the gratification and applause of the black community. I thought gee, I would be kicking myself for the rest of my life saying, "I could have done that, I should have done that, why didn't I do that?" And so that was my motivation, to be the first one to do this because I felt I was in the best position to do it, and so that's what drove me ahead of a lot of other people – John Johnson had far more money, had a better business platform; Percy Sutton had far more political contacts and name visibility, and there were other celebrity types who could have done it. Bill Cosby could have done it, other kinds of celebrities could have gone and got backing. Quincy Jones was a big friend of the people at Time Warner, and so on. I'm just terrified that these well-known, well-positioned African-Americans are going to take what could have been my platform to do something in an industry that I knew everybody in. So that's what principally drove me.

LAMB: Did anybody in the African-American community try to start something along the same lines while you were starting?

JOHNSON: There were people who were always talking about the idea. It was always the currency out in black Hollywood that there needed to be a channel or programming that covered African-Americans in a positive way. There was a need for an African-American channel or a black channel. There was one organization called BEST – Black Efforts for Soul in Television; there was the Cable Communications Center headed by a guy named Pluria Marshall, who was trying to create that kind of support within the black community. So there were a lot of people bending ideas around. Percy Sutton was sort of talking about it because he was applying for cable franchises up and down the east coast. So the idea was out there. I knew somebody was going to do it. It was either going to be me or somebody else.

LAMB: Carriage. You were on Madison Square Garden. All those sporting events went out the same pipeline that took you out there for that period of time. When did you start charging for carriage, and who were your big supporters in the beginning who actually put you on the systems instead of just paying for it?

JOHNSON: Well, when we got started there was a little bit of a scramble to carry our programming, particularly in the urban markets. As cable got into the urban markets, everybody wanted to show the urban city council members, the black city council members, they had programming. I remember the big fight in Pittsburgh between, at that time, ATC, TCI and Warner, I think, were all fighting for Pittsburgh. I remember getting calls from everybody saying "We want to be the first to announce that we're going to carry BET in our market. Can we put you in our franchise? We want to be the first; we want to put out the press release with you." So there was a lot of interest in carrying the programming during the franchise wars because it was sort of a coup to be able to say you're going to carry black programming and use that to leverage the black city council people. So we got support for carriage, but at that time nobody was paying. Well, in meetings with Malone, and at that time Taft Broadcasting by that time had become an investor. Taft Broadcasting had some cable partnership with Malone and of course they were looking at getting into the programming business with their programming content. So we all came to the conclusion that we had to start charging. So we made a decision to start charging something like 2 cents or 3 cents a month per subscriber, and that was sort of what we did.

LAMB: What year?

JOHNSON: That was around early '84, '85.

LAMB: The time you went full-time.

JOHNSON: Right, by the time we were going full-time and we needed to have more revenue basically because the advertiser wasn't there for it.

LAMB: Had your board changed at all?

JOHNSON: No, the board was still the same, hadn't changed at all – except yeah, the guys from Taft had come on the board about that time.

LAMB: Do you remember the names?

JOHNSON: Yeah, Charlie Meacham, who was then the CEO of Taft had come on the board.

LAMB: Where did you get the name Black Entertainment Television?

JOHNSON: If you recall, I mentioned there was an organization that was started up to promote African-American media ownership as well as positive media content called BEST – Black Efforts for Soul in Television. I at one point wanted to use BEST – Black Entertainment Sports Television – but I figured that'd be too close to BEST, so I just dropped the "S" and went to the "E", and it was just Black Entertainment Television. I liked the acronym BET because it had such currency in the black community, you know, bet on this, bet that, you bet. It was something that I knew black folks would catch on to right away, BET, bet, and so on. So that I liked, and the other is I wanted to put the emphasis on entertainment, and interestingly enough, for the first couple of years, people insisted on calling BET – for Black Entertainment Television – Black Educational Television. The feeling was that for any black network to succeed it had to be an educational product as opposed to an entertainment product. So a lot of times people would say the Black Educational Network, Black Educational Television, so on and so forth. So we had that run of that, and then a lot of people called it Black Entertainment Network, BEN, and I didn't want "Ben" because that was the wrong image I wanted to send. So, Black Entertainment Television was the name from the very beginning.

LAMB: Excuse the expression, but when were you first in the black?

JOHNSON: I was first in the black, and I can remember handing out to the employees a plaque with a dollar enclosed in it, one of those Lucite block things with a dollar in it, and that was in 1986.

LAMB: How much were you in debt at that point?

JOHNSON: At that time, I think Malone over the period of a year... Malone and Taft, and then later Home Box Office had come in, the accumulated debt that had been put into BET over that period reached somewhere in the neighborhood of five to six million dollars.

LAMB: When did you first change programming from movies and gospel music?

JOHNSON: WE changed from movies and gospel music when we found out that we couldn't buy enough movies. Once all of the other programming channels started exploding, everybody needed content. The pay channels needed content; the big super station channels needed content. So the movies became too expensive. So we started moving out of movies. We had run a series of something we called "Black Movie Classics". We had gone to the Library of Congress and gotten a hold of old black movies that were produced during the Depression when the government funded the WPA and paid artists not only to do paintings and drawings and other kinds of things, but also to make movies, and there were a number of African-American producers at the time who produced movies, and those movies were in the public domain after so many years. We acquired those by going to the Library of Congress and having them basically give us a duplicate. We paid for the duplicate and they kept the master. In some cases we had gotten right to the masters, but most of them... we ran those for a while. But as we saw that the network was not able to either buy movies that were current movies, or buy current sitcoms, we started looking at music entertainment and music videos as an alternative source of programming. This was at a time when MTV, which started about the same time, was playing music videos 24 hours a day, but interestingly enough they weren't playing music videos by African-American artists because they were a rock music channel and African-Americans didn't do rock music, so they never played those videos if they were made, and the record companies didn't make the videos. I remember coming out to a cable convention to introduce BET's new programming line-up, so to speak, at a session, and we showed our first music video saying "From now on there will be a place for African-American music videos to be seen and heard by viewers all across the country". Then we went to the record industry. We sent to the record industry... like an album. It was like a 76 LP kind of cover that showed the kind of programming that we would have and the carriage we had, and basically told them if you make the videos we assure you, we'll give you a platform to show them. That's when BET stepped into the music video business.

LAMB: Did you ever have to pay for the music videos?

JOHNSON: Never had to pay. There was an attempt by the record companies in the late-80s, mid-80s, they were trying to get the networks to pay for music videos, and this was a time when video channels and video shows proliferated all across the land. We had a channel, MTV had a channel, Turner tried to launch a channel if you recall, but every local TV station in an urban market had its video show, whether an hour or a half hour, everybody had a video show. The record companies saw this and said, "Gee, we should start making people pay for this." Some people paid for exclusivity. For example, MTV at the time would pay for an exclusive Michael Jackson video or an exclusive Whitney Houston, or an exclusive Madonna, whatever. We resisted that because we didn't want to get in that game. I remember on several occasions boycotting certain labels because they were saying we're going to force you to pay, or they were agreeing to give MTV exclusivity on their top acts and we were playing their baby acts. We said, "If you're going to play that game, we won't play any of your acts at all." So we fought that. That was a business decision I made that BET would never survive if we had to pay the record companies, so we were able to beat that back, and since that time as we got more carriage and greater visibility, greater penetration, greater brand acceptance, there's no way that the record industry will ask you to pay for it.

LAMB: What happened to the business side of this as you went through this time period? A couple of things – you started in January 1980. What year did you sell?

JOHNSON: Started the company in 1980, January, sold and closed with Viacom in January 2001.

LAMB: And in 2001 when you sold, what was the company like then? What was the size?

JOHNSON: The company was probably about 500 employees doing close to almost 300 million dollars in revenue, a very profitable company. We had gone, if you recall, we were public in '91. BET, in '91, became the first African-American company publicly traded on the New York Stock Exchange. I remember we went down to a board meeting to make a presentation – John Malone was there, Dob Bennett was there, Herb Wilkins was there, Ty Brown – and we were going down to show John, give him our business performance. We looked at our numbers and Herb said, "Bob, BET is making so much money Malone is going to want you to take this company public because you've just got so much cash and no place to spend it." I said, "Well, what do we do?" He said, "Why don't you take about 10 million dollars of your profit and put it in another line item and call it "reserves". You can show this is your profit, but then this 10 million will be over in capital reserves." So I said, "Okay, we'll try that and see if Malone picks it up." We laid the documents in front of John, John's looking at it sort of nonchalantly and he said, "Bob, the company's doing well, the company's really doing great. You're really making a lot of money with the business. What's this 10 million dollars over here." Herb said, "Well, that's capital reserves." He said, "Reserved for what? You've got plenty of cash over here. Bob, this company ought to be public." That was April at a convention in New Orleans. By October of that year, we were public. It was the fastest go public period that I've every seen in terms of taking a company public. So we went public in '91...

LAMB: At what stock price?

JOHNSON: We went out at 17 bucks a share, stock on the first day closed at about 26 dollars. So we had a company at that time that had a market cap in excess of 300 million dollars, about 371 million dollars at that time.

LAMB: And how much ownership did you have then?

JOHNSON: At that time I had about 65% of the company.

LAMB: And John Malone had how much?

JOHNSON: John had about 12 ½, maybe 15, and Taft, at that time, had 3%, 4%, and HBO had the balance.

LAMB: And you personally had other things, like the DC cable system.

JOHNSON: At that time the District of Columbia cable system had been in operation. We started operating that in '86, '87.

LAMB: How much of that did you own?

JOHNSON: I owned about 20% of that.

LAMB: Who owned the other 80%?

JOHNSON: Part of it was owned by other investors in the city, and Malone (TCI) was our other partner and had about 40%.

LAMB: When did you sell that part of your portfolio?

JOHNSON: I sold that when AT&T bought TCI. We sold to AT&T then, so that would have been about three years ago.

LAMB: I don't know whether this is public or not, but how much money did you come out of that with?

JOHNSON: I put in 100,000 dollars at the time, and I think we walked away with about 5 to 6 million dollars.

LAMB: Now, along the way you had one child.

JOHNSON: Um-hmm.

LAMB: Name?

JOHNSON: Paige.

LAMB: And how old today?

JOHNSON: Paige is 17.

LAMB: What was the birth year?

JOHNSON: Paige was born in '89.

LAMB: Did your wife ever work in the company with you?

JOHNSON: She worked as an executive vice-president in charge of corporate affairs, and she served on the board.

LAMB: Now, along the way you are getting richer and richer, personally.

JOHNSON: Yeah.

LAMB: What did you do about your own lifestyle during these years?

JOHNSON: The only thing I really did was I remember when we went public, we were sort of going through our rehearsal for making presentations to analysts, and the question they always ask you when you go public is are you going to sell any stock? And you're supposed to have an answer like, "Well, of course, for estate planning from time to time I will sell some shares." So during the rehearsal one time they asked me are you going to sell some stock, and I said, "Yeah, I'm going to sell some stock." They said, "Well, why are you selling stock." I said, "I'm going to build me a house." They said, "That's the wrong answer. Don't give 'em that. You talk about you're going to do this from time to time, etc." But anyway, one of the first things I did was to build a home. I've always wanted to do that, so that was the primary thing that I did.

LAMB: When did you sense that people saw a change in you, that you were becoming successful with a network, but also successful financially, and people would come to you and expect things from you?

JOHNSON: I would say it really didn't hit because people always saw BET as a... until BET went public, I would say '91 because prior to '91 BET was a privately held company, we gave out no information, we were not in the mainstream of black businesses, we weren't even, I don't think, listed that much on black enterprises lists because we didn't give out that information. I was still basically living in the same house I'd lived in in northwest Washington for about ten years or so, and going to work everyday and doing things and not having a lot of disposable income. I wasn't giving a lot of money away, wasn't hosting a lot of fundraising events, so it was pretty much under the radar. I think '91 when BET goes public, at that time then everything's available to the public to read about and see, and all of the sudden now somebody sees 371 million, 65%, all of the sudden you're a multi-millionaire, then people begin to notice that you have paper money anyway, and some things change, you're paying yourself more salary, you've probably got a company car, and people in politics now can point to you as a publicly traded owner of a company. "A multi-millionaire", they can say it and be comfortable because it's true. So I would say '91 is sort of when the awareness of the wealth creation from BET was coming to the forefront.

LAMB: As a member of the cable industry and one of the very few blacks in the cable industry, how were you treated by white people?

JOHNSON: I would say in the cable industry I was sort of in an industry where it was so few African-Americans that you basically went unnoticed and therefore it was sort of you were just a regular person in the cable industry. There was no reason to talk about black issues unless it was talked about in the context of more employment opportunities that would properly address minority... sort of committee for minority employment. I remember we had that, Dick Munro headed up the first one, but that was sort of the politically correct right thing to do; there was never much discussion. There was also a committee to deal with minority ownership, but again, it was politically correct, headed up by a guy named Jerry Green and Herb Wilkins. Sort of a little bit lip service to giving minority's ownership in cable, but nothing was personal in terms of minority issues or racial issues because there were just so few of us. The advantage I had is that I was a known commodity to everybody, so if you go to a cable convention and if you're black and you happen to be about 5'8", you were Bob Johnson, no matter who you were. So it was a little bit of a joke, but I know Curtis Simons, when he first came to BET and became another face with the cable industry, for a long time he was Bob Johnson because that was the only name that they knew. The only thing in the course of my relations with the cable industry... it was all very friendly, very cordial – I don't think I ever faced directly any kind of race discrimination. Now, I always felt that the cable industry shortchanged us on rate carriage because we were a minority service, and I think they somewhat shortchanged us on giving us more distribution because we were a minority service, as opposed to giving some other channel broader distribution against their demographic. It could be considered marketing, but the one thing about it is most of the cable guys that I associated with, we were all friends, so even if there were some who were less cordial on race relations, their friendship and affability and your belief that they cared about you or liked you sort of took over. I remember one time somebody told a joke that was sort of an off-color racial joke, was told in the context of we were all sitting around the bar like we do at a cable convention or in between the meetings or whatever. A guy told a joke, "Bob, have you heard about the fact that the Ku Klux Klan has acquired all the rights to the movie Roots?" And I said, "No, I haven't heard about it." He said, "You know what they're going to do with it?" I said, "No, what are they going to do with it?" He said, "They're going to run it backwards so it will have a happy ending." It's a bad racial joke, but in the context of guys, all sort of pioneers, all trying to build something, all sitting around having a drink, knowing that this guy is somebody you've known prior to this joke... you know, you don't take offense at it, but you don't necessarily encourage it, neither do you get up and smack the guy in the head and walk out. It was one of those things. But that's the only time I can recall any kind of joke like that anybody would tell me. Nobody would come up and tell me jokes just on the base of race.

LAMB: What about carriage? The numbers? When you ended up selling BET, how many homes did you have?

JOHNSON: We had about 72-73 million homes.

LAMB: Not missing many.

JOHNSON: Not missing many, but not fully penetrated like other services, but not missing very many, and rates probably lower than any other service in the country.

LAMB: What was the rate when you sold?

JOHNSON: The rate is what it is today. It's about 15 cents per sub.

LAMB: And how many other channels did you start?

JOHNSON: We started BET Jazz, which now exists in about 10 to 12 million homes; BET Gospel, which is a digital channel; BET Hip-Hop's a digital channel. Those were the primary channels that we started. We've done some other businesses in other services.

LAMB: What year?

JOHNSON: What year? I don't know. Jazz is about ten years old, so Jazz was around in '91, '92. These others have been more recent digital channels in the past year or so.

LAMB: Now, another issue in all this is you went private and then eventually you went back public again? Or did you sell directly?

JOHNSON: We went private. We were public for seven years, and John and I never felt that the public gave us the true value for BET stock. The stock was standardly traded, there was concern that we might take all the cash we were making and go into businesses that Wall Street didn't like – the movie business or the restaurant business or whatever they didn't like. They were just concerned because we had so much cash, what would this company do with this cash? So we had a lag on our stock. At the time of about 1996-97, we had decided that the stock was not going to move, it was undervalued, why shouldn't we take the company private? We decided that we would buy in the shares, John and I, since we were the principle shareholders. There was about 30-32%, or so, of the stock in the hands of the public. So the stock had been trading on average somewhere between $25-26 a share. It had been that way for a long, long time. So, John and I said, "Well, we've got to pay a premium for it, so let's put out a number and see if we can get everybody to sell it to us." So we offered the shareholders 46 bucks a share for stock that had been trading for $26 for a long time, and do you believe it, the very next day the stock shot up to $62 a share. We finally end up buying everybody out at 63 bucks a share. So we bought the company out at 63 bucks a share.

LAMB: Where'd you get the money to buy them out?

JOHNSON: We borrowed the money from the Bank of New York. We had had a long-term relationship with the Bank of New York, so we borrowed the money from the Bank of New York, they did the deal. We bought out all the shareholders at 63 bucks a share, and ran the company private for a number of years, and then John always had in his deal... John never sold a share of BET stock in the whole time he owned it, but he had in his provision when we went private what we call a liquidity event, that at some point we either had to go back public so he'd get an exit strategy or we'd have to buy him out if he put his shares to us. So I knew that as an issue, and so we were looking around trying to figure out what to do next. It wasn't a pressing issue, but it was something I knew I had to deal with. So the question is do we go public, do we try to find a strategic partner to come in, how do we grow the business? We were at one point coming very close to buying radio. Clear Channel had bought AM/FM and they had some stations they wanted to spin out. I called Lowery Mays and said, "Lowery, we're thinking about getting into the radio business. Would you be interested in selling us a bundle of radio stations?" And he said, "Yeah, we'd love to sell to a minority, obviously. It would help us politically, but you've got to pay a price." Radio stations at that time were just selling very high premium to value, we felt, but that was something we thought would be a way to grow the business. So Malone, Dob Bennett and I talked about it and we decided we'd do it. We called the Bank of New York, they could put together the financing; we were going to buy these stations from Clear Channel. We were right on the cusp of doing that when an announcement came out that AOL had acquired Time Warner. I sat back and I said, "Wait a minute. I'm getting ready to spend a billion dollars to buy distribution when AOL had just paid billions of dollars for content. So maybe the play is to sell content." So we pulled back from the billion dollar acquisition of the radio properties, and that's when John and I got seriously talking about maybe we ought to talk about finding a buyer. It happened that at that same time, Sumner had called John...

LAMB: Sumner Redstone.

JOHNSON: Sumner Redstone, CEO of Viacom, had called John talking about trying to buy Discovery. Well, John wasn't ready to sell Discovery, but Sumner said, "Do you think you might be interested in selling BET?" Well, John said, "I don't own BET. Bob owns it, so you need to call Bob." So, Sumner called me and I said, "Gee, Sumner, I'm not really a seller right now, but I'd love to talk to you about being a strategic partner." He said, "Well, we don't do strategic partnerships, we usually acquire." I said, "Well, I'm not ready to sell right now." He said, "I'll tell you what. You think about it, I'll think about it, and I'll call you later on." Well, he did call back and I said, "Let me come up to New York and talk to you." I met with him and Mel on the exact same day, interestingly enough, that United Airlines and US Airways announced their plans to merge, at which point I would have gotten the spin-off route called DC Air. So I had that press conference that morning at 10:00 with all the hoopla about the airline, and then after that press conference, about 1:00 or 2:00, Debra Lee, the president and chief operating officer of BET, and I went over to meet with Sumner and Mel. I left that meeting feeling that if I were going to do a deal, Mel and Sumner would be the two to do a deal with because Sumner asked me, he said, "Bob, what's your goal for BET?" I said, "My goal is to make it the preeminent African-American owned media company in the world." He said, "Well, that would be our goal, so if you want to do a deal, let's talk about it." When I left that meeting I said, "Let's do a deal." So we hired Allan & Company and they said, "Well, Sumner's a deal, but you ought to talk to the other guys." So we had a meeting out at their big conference in Sun Valley with some of the other players. We met with Messier of Vivendi; we talked to Rupert's people at Fox, and talked a little bit with Eisner and everything else, but when it came down Sumner and Mel had the best relationship, they were doing an all stock deal, which both John and I wanted, and that's sort of how that deal came together.

LAMB: At the time of sale you owned how much?

JOHNSON: At the time, let's see, we had taken everybody back in, but we bought everybody out, so John had 35% and I had 65%.

LAMB: And the price that you sold it for?

JOHNSON: The price we sold it for was 3 billion dollars.

LAMB: Do you still have a relationship with BET?

JOHNSON: Yeah, I signed a five-year contract to keep the position as chief executive officer and chairman, so yes.

LAMB: How much do you work at it now?

JOHNSON: Oh, I'd say about 20-25% of my time is devoted to BET. I've got a terrific chief operating officer in Debra Lee and she's doing a fantastic job leaving me free to do everything from basketball to hotels to whatever else I want to do.

LAMB: Do you feel differently about it now as chief executive officer but not owner?

JOHNSON: I think different in the sense that I'm not totally responsible for its future beyond my five years.

LAMB: When are those five years up?

JOHNSON: In '05. So I don't allow myself to think about BET in 2006 and 2007 other than with some nostalgia and with some hope and confidence that it's in good hands with Viacom and Debra if she stays on. So, in that sense, but I'm not plotting and scheming to where I want to take BET next. So when I got out to Sun Valley, I'm not sitting there looking at these guys and saying is there a BET deal with this guy over here, or a BET deal with this guy over here, so I'm not plotting and scheming in that sense, nor am I as concerned about trying to say I've got to continue to put my stamp on this thing at BET. Somebody else is going to stamp it. So in that sense, but now looking at it, it's how do I, if you will, make sure that whatever history of BET in terms of the role that I played, that story is told. For example, one of the stories I like to tell is that if you take BET from its beginning in '80 to its sale in 2001, for every year BET existed it created 150 million dollars in value. So 20 times 150 million gets you 3 billion dollars, so every year we existed we added 150 million dollars in value. No other African-American company has ever done that. All of these firsts we were able to accomplish with BET, and BET, because African-Americans got into the stock market through BET we have created more African-American multi-millionaires than any other company in black America, or any other company in white America for that matter because very few African-Americans get in on stock in a start-up very early like they did at BET. Most African-Americans who get jobs in companies get in at a mature level as executives and they get options, but the options are based on a higher valuation.

LAMB: Do you have any idea how many millionaires you made?

JOHNSON: I would say if you count them all up and you include me it's about ten.

LAMB: And if the figures are right, you're worth over a billion seven, based on the sale alone, that's forgetting the other things you might have had. Does that make you the richest African-American in the United States?

JOHNSON: In terms of personal net worth? Yes.

LAMB: And you started in 1979 with nothing in the bank.

JOHNSON: Started in 1979 with basically zero in the bank.

LAMB: Does this feel unusual to you?

JOHNSON: It doesn't feel unusual in the sense that you understand how the value can be created. You start with a business, you get investors, you take it public, it grows, somebody buys it based on a value that they put on it. So, intellectually I understand how the wealth is created. Does it give you some sense of awe that you did it? Not so much because like I said I understand it. There are other people I've seen who've done it. Ted Turner did it, so you see people who do it, and in some cases you see people who get it who may not even deserve it. I think the thing that sort of makes me proud is the fact that I've always been a believer that one thing African-Americans should focus on is wealth creation and wealth preservation, and so to the extent that I was able to do this and I can use that as a platform to deliver a message, wealth creation and wealth preservation, is sort of the thing that I feel most proud of because it allows me to speak to what I think I can give voice to better. I'm not a civil rights activist, I'm not a humanitarian, I'm not a political activist in that sense, nor an artist. The expression of what I do best is I think I've had a track record in the wealth creation and the wealth preservation and I'd like to see more African-Americans focus on that. One way to do that is obviously through ownership, and one way to do that is understanding the economic system, and another way to do that is focusing on how you take advantage of those things.

LAMB: Let me just ask you a couple of questions in closing about the role BET played in news and public affairs. When was your first news program that you developed?

JOHNSON: I don't know, but we did news early on because we felt that that was something we had to do to both, one, address our public's concern, but also to act as a content that would sort of keep us from facing competition from someone else who would come out and say we're going to be the news and public affairs channel because BET doesn't do it, and I thought that would hurt us in terms of selling our product both to cable operators and to some extent the public, the black community. So we've had news for a very long time in various forms and formats, whether it's a full news show, whether it's news briefs, whether it's public affairs shows. What I think we've done in public affairs is that I've often described BET, particularly as we got a little more visibility, as the network that some African-Americans turn to when they either can't get their voice heard at all on the white media platform, or that they feel that they need a platform to get back into the hearts and minds of black people, particularly certain celebrities. Certain celebrities have had what I call loosely faux pas in their life, and they've sort of said, "Gee, now I've lost the white community." A prime example early on was Vanessa Williams, the first African-American Miss America, but had some unsavory photos in Playboy that lost her her crown. Well, it also lost her her Miss America white kind of following, but she wanted to get back to the black community, so she came on BET to talk about that. Another example, when Whoopi Goldberg, who at that time was married to Ted Danson, there was some off-color joke that was told at the Friar's Club by Whoopi and Ted and they wanted to explain themselves to the black community, so they came onto BET. And of course, the famous O.J. Simpson interview when white America would not give O.J. the interview he felt he should get. He just said, "I'm not going to put myself in front of a white journalist and be mistreated by that particular medium or that particular journalist." Well, I started making calls and got through to some people who got to O.J. and we were able to get the O.J. Simpson interview that Ed Gordon hosted, and that turned out to be the highest rated public affairs show on cable at the time. So, we became sort of a place, if you will, for people who felt that "I'm not going to get my hearing in the white community, or I need to get back to the black community," and O.J. obviously felt he had to do both of those things. So, that's what we've been able to do in public affairs, and there have been other examples, the most recent of course being Trent Lott, where he came on BET wanting to talk and to share his particular point of view on what he said with the hope that it would get him back to the black community.

LAMB: As you know, you've been somewhat criticized in some places for not being, as you said earlier, a civil rights leader or a humanitarian, and you've talked about this before. What do you think your responsibility is as a black man, who's been hugely successful, to the black community? Anything other than just a show of the ability to make it?

JOHNSON: I've always felt that what I do best is to speak to the black economic message, and that's always been my thing. I can't put on a mantle that I don't wear comfortably; being the activist, being the community leader, being the social goodwill person. I don't wear that robe. So what I feel most comfortable talking about is African-Americans should own more stock; African-Americans should save more; African-Americans should be comfortable being owners; African-Americans should seek to create and preserve wealth. So, that I can talk to. Now, a lot of people want a black owner or a black wealthy person to sort of be really the source of give us everything you've got to help other people who are less fortunate than you, and that's really what a black person should do. I never bought into that model; I never bought into that ideology. So, we do get critiqued a little bit. One is, I mentioned earlier – we're not the Black Educational Television Network, and some people think your responsibility is to deliver educational programming, or you're not providing us with all the public affairs shows. We need to know more about housing, we need to know more about this. My thing is we do that. We do it in our way and we do it under our current message and format. So we do have a heavy focus on AIDS and we reach more young people about AIDS issues than any other organization in America. So we do address those issues. We have had the public affairs program that has broken issues and brought personalities to the network. We do all that, but I think what happened is, what has sort of been a part of our life for a long time, we have been the only one. There are six or seven news networks owned by white newscasters. There are how many generalist programming networks on cable, and how many other kinds of specialty networks that target the white Americans? We've been the only one, so every responsibility that anybody black would visit has to be visited on BET. So we had to be everything to everybody. Well, obviously you couldn't run a business and be everything to everybody, and you certainly couldn't run a business the way I wanted to run it and be everything to everybody. So I'm very comfortable with the suit that I wear in terms of what I've accomplished with BET. I'm very proud of it and believe it has done a tremendous service to the black community, particularly in the field that we chose, and that's entertainment. There's an entire industry that's called the music industry that is built around BET, and in addition to that there's obviously a lot of African-Americans who have gone on to be top professionals in their field because they got their feet wet at BET. They got their first start in business and in being talent and in other areas at BET. So, I'm very proud of that. When I look back on the 21+ year history of BET, BET by anybody's definition has been a sterling accomplishment, and I think it will continue to be long after I'm no longer involved in it, and as far as I'm concerned I can't see any reason why there won't be a BET 20 or 30 or 100 years from now.

LAMB: Thank you, Mr. Johnson.

JOHNSON: Thank you.

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  BACK TO ORAL HISTORIES

James Jimirro

James Jimirro

Interview Date: Tuesday December 12, 1989
Interview Location: Los Angeles, CA  USA
Interviewer: Marlowe Froke
Program: Penn State Collection
Note: Audio Only

FROKE: We are speaking with James P. Jimirro, founding president of the Disney Channel, former Columbia Broadcasting System executive and now the president and owner of his own video/television production and distribution company which is called J2 COMMUNICATIONS. The date is the twelfth of December and we are recording this first session in Mr. Jimirro's apartment at 10787 Wilshire Blvd. in Los Angeles, California. Jim, thanks very much for agreeing to do this oral history with us.

JIMIRRO: It's my pleasure, I've been looking forward to it.

FROKE: This is just like old time week. Maybe not so old. You are a graduate of Penn State.

JIMIRRO: That's right. I remember taking journalism courses from you.

FROKE: I remember your Thespian productions and many, many other wonderful things you did when you were at Penn State. What we'd like to do on the oral history, Jim, is to divide it into four general sections. Like all plans, sometimes they fall apart so we'll just say we're going to do it. If it turns out differently, that's all right, too.

We like to chat generally in areas that would be, broadly speaking, biographical information ‑‑‑ birth dates, your education, your family, and so on. Then we will move into discussion of your career, development of your professional career, which has been pretty much focused on the media from the very beginning.

JIMIRRO: Definitely.

FROKE: Then we will focus on that particular part of the oral history that is of concern because of the context in which we are doing these oral histories, and that is the cable television industry. We can look at your founding of the Disney Channel, some of the history related to that. Finally, we can talk about one or two of those things that you regard as your major achievements while you were associated with the cable industry. Feel free to talk about anything else that you want to talk about, too.

You were born in Donora, Pennsylvania?

JIMIRRO: That's right. I was born in the little town of Donora which is about 24 miles away from Pittsburgh, and went to the first four years of school at Monongahela. Monongahela, Donora, and a couple of other cities formed a small megalopolis along the Monongahela River. They were essentially mill towns.

When I was in fourth grade, my father left that environment and went to work for the Metropolitan Life Insurance Company, and ended up becoming a key executive for that company. In the process we moved to Pittsburgh. I was educated in Pittsburgh through my public school years. I went to a school called Avonworth High School. You were talking about my background in communications. It really began long before I met you, which was when I was in high school.

I had an instinct and affection for communications for as long as I can remember. I was the one broadcasting high school football games. I was the one who was trying out for the debate team. I was the one who wanted to be on the school newspaper and in all the plays. I just seemed attracted to communications. It just didn't matter which. I loved radio and television and film. I loved public speaking. I loved writing and reading, anything to do with communications. To jump ahead so many years, the name of our new company is actually J2 COMMUNICATIONS. It's not J2 Entertainment or J2 Video, it's J2 COMMUNICATIONS, which, in a way, is intended to reflect this broad interest that I have in communications of all sorts.

FROKE: Was it fascination? Was it the radio broadcasting medium that brought you to it?

JIMIRRO: It's difficult to answer that question. I certainly was fascinated by the radio medium. One of my ideas of fun when I was 13 years old was to go with a couple of guys and watch disc jockeys work, literally. There was a disc jockey named Art Pallan. I think he's still around working for KDKA in Pittsburgh, 1020 on your dial. As I recall, we used to love to watch him cue up records and say "Stay tuned for Patti Page." We loved to do that.

Years later I remember being in New York and wanting to go look at Studio 8H at NBC. So, I don't know how to answer your question. I have this image of myself going to watch disc jockeys work when I was a young teenager. Whether that was what encouraged me in communications, or whether it was a symptom of the fact that I already had this interest, I can't be sure. I think one of the things, and I think it's fair to say this about all of us, is that I was pretty good at it. We all as young people tend to be attracted to activities we do well. I was a regular kid, I loved to play sandlot ball, but I wasn't ever going to be a great athlete.

Maybe I had an aptitude toward speaking or maybe a teacher said, "Gee, you sound pretty good. You ought to try out for the school play." Maybe part of it is feeling that you have an aptitude for something, but, one way or another, it certainly goes back, literally, as far as I can remember.

FROKE: Was anyone in your family theatrical, from the point‑of‑view of community‑type activities or the way they managed themselves, their demeanor?

JIMIRRO: No, not at all. That's an interesting question. I had parents who were very encouraging to me in terms of the development of my interests. I have often observed, however, that the interests that formed the center of my life, or the most important part of my life, are ones that I developed without the influence of my parents. What I mean by that is I loved going to plays and going to theaters, but they never took me to the theater. They did a lot of wonderful things for me but that was not one of them. I think about that a lot; if I go to the theater now and see a family and there's a five or six year old child with them I think, "This is a child that's going to love the theater in a more natural way." I ended up discovering it for myself. Actually I would take my parents to the theater. I would say, "Let me share this with you." I often think of some of the many things that are quite important to me, somehow there were influences other than my parents that brought me to them.

FROKE: Is there a teacher who might have influenced you in this direction, maybe in elementary or in high school? That doesn't stand out either?

JIMIRRO: No, that doesn't stand out either. I remember I was perceived to be a relatively good performer in plays, but never good enough to make it a career. I quickly learned that I should get behind the camera not in front of it. Mary Wilson, an English teacher who directed the school plays, used to come up to me and say, "You don't have to try out, which part do you want?" Of course this was a very small high school. I was in tenth grade, or something. I remember doing a play and there were two leads and she literally said, "Which one do you want?" It wasn't an ego trip or anything.

FROKE: She appreciated what you could do.

JIMIRRO: One of the things I've often said is, I've had a great college education, but I don't really look back and think that I had a great high school education. Being candid, I think there were just a couple of teachers who had a major influence on me. I don't think it was bad by any means at all. But, I don't look back at some great master teacher who really moved me along. There were exceptions to that, but not in the area of which we're speaking.

George Durst, who now lives in Somerset County, Pennsylvania, was an English teacher in high school who all of a sudden decided to make us all general semanticians. He got me interested in general semantics. He had read Korzybski and Stuart Chase and Hayakawa before he was a Senator, Language in Thought and Action. He was the one teacher I would say who showed me how much fun there was in learning and how exciting it was to learn.

FROKE: You were born in 1937.

JIMIRRO: Yes.

FROKE: Did you have any sisters or brothers?

JIMIRRO: No, I'm an only child.

FROKE: So your family focused all of its attention on you so to speak?

JIMIRRO: Not so to speak, I think literally. You get that when you're an only child. Interestingly, when I was being raised as an only child, I loved it and didn't even think of any other alternatives. As I grew older, I began to miss brothers and sisters. I would see peers who had bigger families and more people around them, I used to think, "It would be nice to have a brother or a sister."

FROKE: What were some of your mother's avocations? I understand that she is still living?

JIMIRRO: Yes, she is still living. She was the consummate homemaker. My mother got married when she was very young and I was born very shortly after they were married. I think about a year. She was a homemaker, one of the kinds of mothers and wives that would have come out of that period. I don't ever sense that she had one iota of regret about that. She was as fulfilled as she could have possibly been. My mother and my father were lovebirds from time immemorial. She got involved in a lot of civic activities and she did volunteer work at hospitals, but she never really earned a living.

FROKE: Was it ordained in some way that you would come to Penn State to do your baccalaureate degree work after you graduated from high school?

JIMIRRO: Not at all, because my Dad had never been to college.

FROKE: You were the first generation to go to college?

JIMIRRO: I was the first generation to go to college, although my Dad, perhaps because he didn't go to college, was really eager for me to have an education.

FROKE: And he gave you complete choice?

JIMIRRO: Yes. You know what it was like back in those days. Our high school class only had 54 people in it. That puts in perspective my getting the leads in all the plays.

FROKE: My high school class had seven in it.

JIMIRRO: Seven?

FROKE: And I could not make the basketball team. (Laughter)

JIMIRRO: We were in a small town near Pittsburgh and everybody knows who's applying to Penn State, who's applying to Denison, who's applying to Harvard and so forth. I was a pretty good student and got accepted at six or seven universities. I chose Penn State because I really liked the idea of going to a large university. It seemed to have a panoply of opportunities. Interestingly enough six of our 54‑person high school class, went to Penn State too. It was about the typical average, 12% of the total.

FROKE: In your career as a student at Penn State you not only took advantage of the curriculum but you had a wide range of extracurricular interests as well.

JIMIRRO: Of course. I had two eras at Penn State. I went back there for Ph.D. work. But again it was so uni‑directional. I went to Penn State and majored in radio, television and film then. I entered Penn State in 1954. The program was quite good but it was not nearly as good as it is now. I got involved in all the activities that related‑‑the Penn State Players, Thespians, WDFM of course, and the other things that supported my interests.

FROKE: When you were graduated from Penn State you chose to go to Syracuse University for your master's degree.

JIMIRRO: They had a very, very intense program. By intense, I mean eleven months. It was an eleven month program, three semesters. You either finished in eleven months or you left. There wasn't an option to go beyond that.

By the time I graduated from Penn State I was looking for the best communications program. There were no Annenberg schools then. I remember looking at Boston University, the University of Chicago, Northwestern and Syracuse. Syracuse had a very strong radio and TV program. Kenneth Bartlett was there, and Eugene Foster. It was a professional program. It wasn't like going to a trade school, but it had a strong professional element to it. That was a great year. The program was between 36‑45 credits, about 40 credits over an eleven month period from September to the following August. By being involved in a group of 30 or 40 or 35 students all of whom were very focused, I must say not only did I have a great year there, but I met some wonderful people who have become lifelong friends. Of course, that's true of Penn State too. I remember forming a lot of great lifelong friendships and relationships at Syracuse.

FROKE: I happened to read a piece about you in one of the trade papers in which you made reference to the Syracuse year as very important because it gave you a perspective of the history of television and radio which then you were able to make some of your own judgments about. If I remember the phrase correctly, you learned that there really wasn't much that was new and that things had a tendency to repeat themselves from one medium to another medium. Do you want to expand on that idea a little bit when it went on to become a part of your career.

JIMIRRO: For the first part of that, maybe we should talk about the Ph.D. part because it relates to the same thing in a way. When I got out of Syracuse, (I had actually started school a little early; because of my birth date, I was always the youngest kid in the class.) I had a master's degree. At the time I was 22 years old. I looked about 14. I thought, what should I do now? I was on the horns of a dilemma because by that time I was attracted to the industry, but I also had done some teaching at Syracuse as part of a graduate assistantship. I found myself attracted to academia because I liked ideas. I liked the idea of being able to take a broader view of events. I was, all of a sudden, on the horns of a dilemma as to whether I wanted to be a practitioner or whether I wanted to teach. I guess one of the ways that I delayed that decision was to go back to Penn State and work towards a Ph.D. in Communications. I never got the Ph.D. but I ended up with three more years of education. I have eight years of college education.

FROKE: You did all your coursework, but did not do the dissertation, is that right?

JIMIRRO: Yes. I got hung up on the foreign languages. Of course, I don't think you need foreign languages anymore for a Ph.D.

FROKE: You can get a D.Ed. I guess.

JIMIRRO: Having eight years of education with four very intense years in communications has really changed things for me. I was thinking, when I make business decisions or decisions about what kind of television shows to produce or what kind of videos to make or how to market them...I can't point to the importance of knowing something of the history of communications or something of the social role of communications or something of the government's role in communications, but the importance is there.

How that background knowledge impacts your day‑to‑day decision‑making is difficult to quantify, but somehow it does. Having that perspective, having that frame of reference just seems to make a difference. I feel that I approach what I do differently than a lot of other people who don't have the knowledge of what went on in government regulation of broadcasting in 1927. I can't quantify why that is true but I know that it is. The point of all this is, I would not have traded all that academic experience even though I never use it in the teaching sense, for anything in the world. I think it's made me different. It's made me feel differently and behave differently.

FROKE: Your ability to analyze a particular product for marketing draws upon your sense of the economics of the communication industry.

JIMIRRO: For instance, just the whole idea of having a different...

FROKE: For the nature of audiences, segmented audiences, and how to slice out a particular audience for a particular type of program.

JIMIRRO: Then, as you say, I think having that perspective also gives you an opportunity to understand that there really isn't that much new under the sun. What you were asking about earlier, the trends and the changes and some of the things that seem so important are really just part of the normal cyclical nature of events. One example is how, when every medium comes along, it seems to be a threat to prior media. Most recently the Hollywood community, just 10 years ago, would have literally gone to the San Pedro Harbor and dumped video cassette recorders off the ships coming in from Japan. I mean that literally. That's how myopic these captains of the entertainment industry were. They couldn't have seen that this video business today would be larger than movies. What was interesting was that they hadn't learned that, through the years, whenever they were threatened by a new medium, the new medium often ended up being more financially rewarding to them than the prior medium. They were never convinced, however that it was O.K. to let a new medium in. They behaved in the same way.

FROKE: The film industry reacted the same way to the cable business.

JIMIRRO: And to television before it. It's just remarkable. Of course the broader perspective on that, whether you know the history or not is that you never want to be provincial. The more things that are happening, the more new distribution systems, the more ways to get information, the more everyone is going to benefit. Reagan said that all ships are lifted in a rising tide. Whether that is true in his case or not I don't know but it was certainly true of communications. You just want more people doing things. You want more alternatives. You want more choice. You want more energy. That's what creates excitement and growth: not being provincial and wanting to keep everything for yourself and maintaining the status quo. That never is the best for anybody, especially the consumer, in my view.

FROKE: You were married shortly after you left Penn State?

JIMIRRO: Yes, and then divorced shortly after I was married.

FROKE: And you remarried just a year or two years ago?

JIMIRRO: I actually got married on New Year's Eve, 1988. As we tape this I'm coming up on a first anniversary.

FROKE: Very nice. I'll offer you an early congratulations. When you left Penn State, you went to Philadelphia to work for an FM radio station. You were program manager as I recall.

JIMIRRO: I was program director; they called it, of WPBS. PBS stood for the Philadelphia Bulletin Station. By the way, as a sign of the times, when I took that job, which was in 1963, The Philadelphia Bulletin was the largest non‑tabloid evening newspaper in the United States of America. It is today out of business. That's remarkable. That was in 1963. The largest. The daily circulation at the time was in excess of 800,000.

The Bulletin was the first owner of WCAU‑‑AM/FM TV.

FROKE: Then CBS bought them.

JIMIRRO: In 1958. I happen to remember the price tag which is almost a joke in terms of today's standards. It was $20 million. AM/FM TV in the fourth largest market. After they sold to CBS, I guess they wanted to put their toe back into broadcasting so they established this FM station. I did become its program director. I was really excited about that. Apropos of my broad interest in communications, people would say to me when I was leaving Penn State, "What do you want to do, radio, TV, journalism?" I told them, I don't care; I just want to be in communications. I ended up going into radio, not because I liked radio better than TV, or not as well; it just seemed like it was the best opportunity. At the time I simply wasn't discriminating.

FROKE: What would you characterize as the most important thing that you brought to WPBS?

JIMIRRO: Naiveté. I'm not exaggerating. When I look back I thought that I had all this education and I loved the business. But I know one thing. There's no substitute for experience. You can't do anything effectively in my view without experience. If you're smart and if you're intuitive and if you're brilliant and if you're aggressive and you're inexperienced, I think you can be bested in a business environment by somebody who doesn't have all those other attributes but who does have experience. A priori just doesn't work in life.

Ed Meehan, who's no longer with us, was the general manager of that station and thought I was the best program director around. And I did very well. When I left there, they tried to get me to stay. I don't want to suggest that I wasn't effective there as far as the Bulletin was concerned, but I look back on it as being, by today's standards, ill prepared to run a division of a communications entity.

FROKE: Were you programming it primarily as a high quality music station?

JIMIRRO: Yes, because the Bulletin had an upscale image. It was not classical, but it was high quality popular music. We had the advantage of all the free advertising we wanted in the Philadelphia Bulletin so we had a large audience.

FROKE: And you could draw from the news staff of the newspaper for...

JIMIRRO: We actually had a news room at the Bulletin. The station itself was at a different place. The Bulletin was downtown in an enormous building. Our news came from the Philadelphia Bulletin. We had a great marketing edge.

FROKE: What prompted you to move to the business side when you shifted to WCAU?

JIMIRRO: I actually was induced to go there by a man named Frank Beasley. Frank Beasley was the general sales manager of CAU. This was now less than two years after I joined the Philadelphia Bulletin Station. Beasley wanted me to come on to be a sales person for CAU. I think I realized early on that I was going to be more interested in business than in programming. I told myself that if I stay in programming, I'll be able to create certain individual programs but I will not have an opportunity to make decisions about where the industry is going to be and the kinds of programs that are going to be created, and the kinds of stations that are going to be heard and watched. I got more broadly interested. Now I was beginning to really develop some of my thoughts. I said, I really want to be involved in what this system is really going to be like and not just in being a worker in a factory.

FROKE: The financial base of the business determines pretty much who moves you into the front seat so to speak.

JIMIRRO: In those days especially, people out of sales...I think it's becoming less true today but in '65 it was...the sales oriented people were running things. Jack Schneider, who was the general manager of WCAU, was a salesman for CBS. Bruce Bryant. They were all salesmen. That's changed today. There are more lawyers and financial people, but then sales was the road to management and I decided that I wanted to be in management. I wanted to determine broader issues.

I left WPBS and joined Frank Beasley, earning less money and foregoing a corner office. I remember a friend of mine supporting me and saying, "You're making a strategic withdrawal. Get some sales experience. Get founded in the business of broadcasting so you can do more exciting things down the road." I actually was at WPBS for less than two years.

FROKE: Were you doing local sales for WCAU?

JIMIRRO: Some national sales and accounts, but mainly local sales and accounts.

FROKE: From WCAU in Philadelphia, you moved to New York directly.

JIMIRRO: Now that was a real interesting thing. CBS had a very, very structured farm system in those days. It's all changed today. CBS had a career pattern for young bright people like myself. The pattern usually was that one would go to national spot sales in Chicago, and then maybe to national spot sales in New York and then go into station management. You then had a chance to become a manager of one of the five CBS O and O's. That's how it worked. When I was at WCAU for about two years, I began to covet New York and wanting to work in New York. I didn't feel like I wanted to go through the steps of Chicago to New York. I wanted to go directly to the Big Apple. I went to Frank Beasley.

FROKE: New York was the center of radio/television.

JIMIRRO: Yep. I went to Beasley who was a good boss. I said, "Frank, I'd really like to go to New York. I don't want to go to Chicago; I don't want to take all the interim steps." At the time, CBS actually had a division called Management Resources. It was a division that was an outgrowth of a CBS that was so wealthy and so strong and so enlightened in terms of personnel matters. They actually had a man named Cliff Benfield who was in charge of taking young people like myself and making sure that they were properly developed. Frank said, "I'll introduce you to Cliff Benfield."

So I went up to New York and I met Cliff and told him that I wanted to go right to New York and he said, "I think I may have something for you. Come on back next week." So I went back the following week and he said, "I want you to see a man named Willard Block." I looked at a note that said Willard Block, Vice President of International Sales. I just couldn't believe this. I had never thought about the possibility of becoming an international businessman which I eventually did. I was very, very, very excited. I went down to see Willard Block.

And I got the job. It's now 1967 and I am living in New York which is in my view the greatest city in the world, and working for CBS, which was, by any measurable standards, the greatest broadcasting network in the world in those days. It's not anymore of course. And having an opportunity to travel around the world. It really was too good to be true. It's everything that I could have ever dreamed of having...career wise, where I lived, and so forth. That was a great period and it enabled me to (and I don't mean this in a pretentious way but just because of that opportunity) become a world citizen. I became comfortable in many countries around the world, made friends in many countries around the world, and that was just because of the opportunity that I had.

FROKE: Were you selling both radio and television programs?

JIMIRRO: No, just TV and educational films. At the time CBS had an educational film division. We were selling TV programming, educational films, and also news. CBS had a very strong news service. They would provide news footage from their correspondents around the world to stations for insertions in local and national newscasts. That was a real interesting part of the work.

FROKE: Then the FCC decided that this kind of activity was too much concentration of communications power in one entity. I believe that the international sales had to be spun off from CBS.

JIMIRRO: In many ways CBS defaulted on that, not that they might have won anyway. It's an interesting thing because it relates to cable. There were three issues around at the time. One issue had to do with prime time access, because at the time, prime time was starting at 7:30.

FROKE: And 7:00 was opened up for local.

JIMIRRO: That was a big issue, prime time access. The other issue was ancillary rights. Ancillary included merchandising and financial interests, essentially merchandising and international and domestic sales; having network participation in ancillary activities; and then the ownership of cable systems. CBS at that time had cable systems with 600,000 subscribers or something like that. CBS made a clear decision that prime time access was worth more than all the rest of these issues combined. They made a decision to concentrate their fire in Washington on fighting prime time access and not even engaging in the other battles. They might have lost them anyway. I'm just saying that CBS had made the decision not to worry about those other activities.

They spun off their little cable systems and the CBS Enterprises Group, which included ancillary rights, into a new company called Viacom which they essentially gave to the shareholders. If they had stayed and fought those battles they may have won. The irony is that they concentrated all their fire and finances on prime time access and lost that anyway.

FROKE: At that particular time, 600,000 subscribers was not a small amount of cable business. That was a good number at that time.

JIMIRRO: Just because you say that, Marlowe, I wonder if I have that wrong. That almost seems high to me. I have to go back and check that number.

What's interesting in retrospect is that it didn't mean much at the time. They just threw that aside. It just wasn't very important to them. It was a long time ago. Nobody could have predicted how important cable systems were going to become.

FROKE: Viacom is still in business obviously.

JIMIRRO: That is the pronunciation of the name. It was originally called (Vee‑a‑com) and someone changed it to (Vy‑a‑com). That name, I tell you there's an interesting anecdote, probably everybody forgets it now. (Vee‑a‑com) as it was called, was Frank Stanton's own name. It stood for Visual Audio Communications.

FROKE: I did not know that.

JIMIRRO: He came up with the name Viacom. Ralph Baruch, who retired recently from that company, not only did a great job, but really was handed an incredible opportunity. What a wonderful little launching pad‑‑little cable systems and all these CBS programs to sell around the world including the United States. He built that into a major communications company. At the time they were trying to build a new entity in the CBS tradition, of course. Even the logo, the lettering in their name was a lot like CBS. There was a CBS feel to that place because everybody was beholden to the great quality that CBS exemplified in those days.

FROKE: Were you privy to a lot of the discussion that went on about the spin‑off of these activities?

JIMIRRO: No. I really wasn't.

FROKE: You were tied up in the day‑to‑day activities of selling products overseas?

JIMIRRO: Yes, and at the time, candidly, Ralph Baruch...who was my boss' boss...I don't think he was even that much in the loop. In fact, he was not the first president of Viacom. A man named Clark George was. Clark George had been the president of CBS Radio and he was more of a confidant to Paley and Stanton. I think at the time, Ralph wasn't really that close to them. He was more of a functionary.

So basically I wasn't involved because he wasn't that involved. It was more of a corporate matter. Clark George was their man. Then it turned out, for reasons that aren't really even that important, that it didn't work out for Clark George. Then Ralph got the opportunity. Clark was there for the better part of a year.

FROKE: Did you think at all about going with Viacom at the time?

JIMIRRO: There was really no choice. You could have gone to CBS and said, I want another job, but basically it was really the same group of people who were essentially moving across town doing the same thing with the same product. The deal was that they had a long-term distribution deal with CBS for whatever rights they had. Basically that was perceived as an opportunity for us to do what we were doing but to control more of it and to have a greater piece of the action in terms of shares, stock options, and so forth.

FROKE: It was about that time, then, that you began talking with the Disney people. Is that right?

JIMIRRO: I was approached by a man named Rich Irvine who is still a very, very good friend of mine. This would have been in...

FROKE: '72 or '73?

JIMIRRO: Yes. This would have been in '73. Early '73. Rich really wanted me to come out and run the International Division for Disney. To make a long story short, I just said, "No, I'm not going to do that. The reason is because you're in California and I'm in New York and I never want to leave New York."

FROKE: New York was your city.

JIMIRRO: I really love New York. If you worked in my job, coming out to California was a great trip. I came out and stayed at the Beverly Hills Hotel and had a car.

FROKE: Did you get to know Mr. Irvine through some contact overseas?

JIMIRRO: Yes. Through the business. He was an excellent man. I knew enough about Los Angeles to know that it was a great place to visit on a business trip for a couple of days, but who would want to live there. I just really loved being in New York. Finally Rich, who was very, very aggressive, and was pretty good at getting what he wanted said, "I'll tell you what. You join Disney and you can set up the whole International Division that we're talking about, in New York. You can stay in New York. New York is after all closer to Europe which is the major market. You can come out to California every few weeks to see us. Essentially, you can have your cake and eat it too."

Based upon that, I left Viacom and became the head of the International Division that Rich was running for Disney in October of '73. Disney had an office in New York at 477 Madison Ave. I got myself set up there. I had a new suite of offices. I started a whole new entity in New York working for Disney. My boss was 3,000 miles away.

Then came one of the great examples of timing that I had. You have to have great timing. Eight months after I joined Disney, Rich left. It was not expected that he would leave because he was really one of the golden boys of the company, but he did leave. There was a void there and I was given the opportunity to run that division. This was extremely unusual. Disney was a relatively insular company. I had only been with the company for eight months. To make matters worse I was in New York which probably made them regard me with some suspicion. The Disney people felt that executives should labor there for 15 or 20 years before they get to do anything important.

That's just the way that company grew up. Yet, because I, in their view was the best person for the job (even though I was viewed probably with some suspicion just because I was new and a New Yorker) they went with me. Eight months after I had joined Disney which was about May of 1974, I was running a division of Disney. At that point I didn't have any problems moving to California because I recognized that I was already at the point where there were more good people in California in this industry than there were opportunities at the highest levels. I said to myself, "If I give up this opportunity for New York, I may forever be sorry." At that point, it's true. There were lots of good people out there and you've got to take advantage of great opportunities when they arise. At that point, I had to make a decision about New York. I wasn't happy about it, but I moved to California.

FROKE: The job within Disney began to expand and grow. From international sales it moved into production and telecommunications.

JIMIRRO: The division that I was running was handling all of Disney's ancillary activities. In 1974, ancillary activities meant the same thing it means now. Disney was primarily a theatrical company and the ancillary activities represented other outlets for theatrical motion pictures. In those days the ancillaries were not very important: 8mm home movies was never a real big business; nor were 16 mm rentals for clubs and churches and PTA groups; nor was re‑formatting them into educational films.

I was running a division that was essentially on the fringes: Disney primarily produced movies and if we can do something else with them after they've had their primary run, which is in the movie theaters, then that activity goes into this division. Then came the VCR. It was defined as ancillary, as were cable and satellite delivered programming. So, with new technologies, by the mid to late '70s the ancillary activities were not so ancillary anymore.

FROKE: They moved toward the main tent.

JIMIRRO: I was inheriting, because of the virtue of technology, grander opportunities in every sense.

FROKE: In effect what you established, was the home video market for the Disney people.

JIMIRRO: I did that. I started Walt Disney Home Video in 1980. I was its first president. That again was an ancillary activity, except that home video was about to become a very important one. There was a bit of a struggle internally because the Disney people in those days were very provincial. They were a theatrical company. They continued to believe that their main audience was theater goers. They were like a lot of establishment executives in Hollywood, but maybe to a greater extent, because Disney was a relatively insular organization. They looked with a jaundiced eye toward all of these new technologies.

FROKE: Earlier in this discussion, you said that many of the people in California wanted to take all of these cassettes and junk them out in the Pacific.

JIMIRRO: I remember people saying things like "Walt Disney never intended that his movies should be shown on a small screen." Things like that. "We have to maintain the status quo." One of the points I would always say in reply was that, though I never knew Walt Disney, I think that he would have just loved this new technology. If history had any predictive value, he would have embraced the new technology and figured out how to be out in front with it. He has certainly been out in front with every other new technology. He was the first Hollywood producer regularly on TV and all of that. There's every evidence that, had he been around, he would have probably been out in front of all of us, certainly including me.

So there were some very interesting internal battles in those days relating to the threat of new technology. Certain people had been in the theatrical business for 30 or 40 years. They weren't learning quickly. They weren't as interested. They were a little confused. What is a VCR, and so forth? I think it's fair to say this, and I'm not saying this critically, it's just, that maybe we'll all get that way as we grow older. They were threatened. The status quo was very comfortable for some people.

FROKE: To pick up another one of your themes, the 8mm and the 16mm in a sense were the antecedents of the VCR. The major difference is that the VCR is a much more people friendly device than your projectors.

JIMIRRO: That's right. We were in that business from the beginning, with 8mm home movies as an example, was clunky. You've got to get out the projector, darken the room. We were selling 8mm reels for $39.95 for eight minutes. That's why, by the way, I didn't have these internal problems before the VCR. Because 8mm, everybody knew, wasn't going to go anywhere. It was a nice little business for Disney but it wasn't any great threat, whereas the VCR was, simply because, as you say, it's so much more user-friendly.

FROKE: Did you do some test marketing on Disney home videos before you launched the activity officially in '80?

JIMIRRO: We actually had done some tests with a company called Fotomat which had made the decision to get into the video business in '79. That was a big deal because in 1979 there were something like 1,000 or 2,000 video stores in the United States. Fotomat itself had in place 4,000 kiosks. So when Fotomat announced it was going to get into the video business it was exciting because we were about to triple the number of locations in the United States at which people could rent or buy a video cassette.

We liked the Fotomat people. We thought there was good control there for a lot of reasons. We made a deal to license some of our movies to Fotomat. It turned out that it just didn't work for them so they are not in the business today. It was one of those ideas that simply didn't pan out. It gave us a little bit of a test and experience in the marketplace, though.

End of Tape 1, Side A

FROKE: This is Side B of the oral history of James Jimirro. There was a rapid change of names of the different companies that you were involved in with Disney during that time period of 1980 to 1985. The name changes seemed to be coming quite frequently. Could you run through those and then identify the context?

JIMIRRO: Are you talking about telecommunications?

FROKE: Yes. Let's say that you started out with international sales and other ancillary activities. Then the name changes begin to come, culminating in your presidency of the Disney Channel.

JIMIRRO: The ancillary division that I was running from '74‑'80 (16mm and 8mm etc.) was called the Walt Disney Media Company. That was just a moniker that they had used for many years. With names for the new technology all of Hollywood had a problem. We had people like me running the licensing of programming to pay television and home video. We didn't know what to call it. One of the silly names for the ancillary activities is non‑theatrical. Everybody hated that name because it was a negative. You identify what you're doing by saying what you're not doing. We thought you ought to be able to come up with something positive.

FROKE: We have the same difficulty with continuing education. We call it non‑credit. (Laughter)

JIMIRRO: That just didn't seem right somehow. I think there was a lot of scurrying around in town to see what we were going to call these new delivery systems. The name telecommunications was emerging. Even that, at the time, seemed like a strange name. A lot of people thought you were going to go over and fix a television set or something, but that did become the name. That division became Walt Disney Telecommunications, which was essentially a term of convenience to encompass video and pay television distribution. That's really what that was. I became president of Walt Disney Telecommunications. Because home video and the Disney Channel were essentially divisions of telecommunications I was president of Disney Channel, president of Walt Disney Home Video, and president of Walt Disney Telecommunications. Telecommunications was essentially a group. That's all that was. I was president of Walt Disney 8mm, Walt Disney Non‑Theatrical, Walt Disney Home Video, and the Disney Channel.

FROKE: When did you get the idea of the Disney Channel?

JIMIRRO: In 1977. This was long before we had started home video. It was the ice ages. That is an important question because at the time I was already beginning to license products to existing pay television services. That began to fall into my purview. This was '76 and '77. Showtime and HBO were around as early as that. Then I began to say to myself, "There's going to be a whole new structure for television networks in this country. There's going to be an opportunity for special interests, or, what I would characterize as significant minorities to be served." I could see it coming. We were going to break down, for the first time in TV history, the oligarchy of the three television networks. There was going to be a chance for many interests to have their own television networks.

In the context of all that, I had such a strong feeling and a great feeling for what Disney represented and its role. I never believed that Disney could be everything to everybody or be another HBO, but I knew, better than maybe anybody in the world because I worked at that company, the tremendous market out there that would want Disney. I knew about that market. I knew it wasn't big enough to make Disney a CBS. We could have never survived as a commercial network but in terms of the new economic realities of pay television, there was going to be room for our own television network. There was the technology, there was the channel availability, and there was going to be the economic viability. You didn't need 20 or 30 million homes like CBS needed. You only needed three or four or five million homes to succeed.

I saw the new world. I actually prepared a very structured presentation for Disney which I presented in May 1977. I had several colleagues helping me on it. There was a man named Art Reynolds. I remember sitting with Art at the swimming pool outside the Fontainebleau Hotel at Miami Beach. We were at a convention there for one of our other little businesses in the winter of 1977‑‑working on this presentation. I had such a sense of that! He was right there with me! The result was that in May we gathered a number of executives, including all the senior management at Disney, and we laid out a proposal for what we were calling at the time the Disney Satellite Network.

You have to understand that in those days we were envisioning nothing like the present scope of the Disney Channel. There was no original programming then. You can remember what it was like. And it would have been so easy then. There was no full satellite imperative at that point. We were proposing a Disney mini‑channel. It would involve maybe three or four movies a week coming out of our library, some of our cartoons on Saturday morning. We'd charge $4.95 for it. In other words, it would be a mini‑service, a perfect complement to an HBO or Showtime.

The presentation was very long and thought out. I talked about the status of the industry at the time. I remember one statistic. There were 1,200,000 pay television subscribers in the United States. You start a presentation like that by doing a survey of the current state of the industry.

FROKE: Your basic and your pay.

JIMIRRO: There were 1,200,000 pay. That's how early it was. What I was saying was...and I laid out all the alternatives. We could do our own. We could continue license to everybody else who would be more than happy to pay us a lot of money for product. But I was making a case as to why, over the long term, the best course for us was to not take the money from HBO. We would put this little investment in and over the long term, I showed projections as to what could happen, not only financially but in terms of being able to test new products and being able to have a wonderful, continuing, multi‑faceted relationship with American families. All the reasons why. I think it was a terrific presentation. It was well thought out and thorough, and very inexpensive to get in the industry in '77, there would have been no investment in programming. There would have been a very modest cost of entry. It would have been a lot cheaper than it ended up being.

They said no to me at the time for reasons that I understood. The main one was that they were just in the process of building the EPCOT Project in Florida which ended up costing a billion dollars. The company was quite strained in terms of human and financial resources. I think that senior management felt that it didn't want to take on another project of the scope of a television network. I should say in retrospect...and it's always easy to have 20/20 hindsight...that was a big mistake just in terms of financial investment. If we had done it when I suggested it originally in '77...if we would have put our toe in the water...without a great investment, we would have simply grown with the industry.

FROKE: That was a time when the cable television industry was looking for programming, too.

JIMIRRO: We would have just grown right with it. By the time senior management finally said yes in 1982 there was more competition. We had to look like HBO on Day One. We had to have two satellite transponders. We were coming into a very mature, exciting professional industry. We ended up spending $100,000,000 in cash on that television network in the first year. We spent $44 million for brand new programming, $19 million for satellite transponders on Galaxy. We had the large staff. It was a different ball game to start a new network in April of 1983. As I say, it was much more costly.

There's another thing I think which I can never prove. I believe if they had accepted my proposal and started the channel in 1977; the Disney Channel would be the second largest pay television network in the country today instead of the third or maybe the fourth. The reason that I say that is this. Shortly after 1977 the big rallying cry was multi‑pay. That's when cable operators thought, "Let's sell more than one pay service to subscribers." Most of them bought Showtime and HBO, two similar services. If, in that period, during '78,'79 and '80, there was a Disney Channel, I think we would have beaten out Showtime. I would have been smart enough to say to any cable operator, "Why should you offer HBO and Showtime which at the time were virtually identical services when you can offer HBO (or Showtime) and the Disney Channel, which are really complementary?" I don't think those two services side‑by‑side would have had a chance to be one and two. I think they would have had to fight it out for number one. We wouldn't have been number one but we would have been number two.

Now there is some differentiation between those two networks. In those days there wasn't. They were both buying the same movies. They looked the same. I think we had the most compelling argument of all to say, "Here's how you get multi‑pay. Show the consumer that you can give him two differentiated services." We were differentiated by definition. That's why I believe that we would have been the second largest pay television service. By the time we got into the business in 1983, there was much multi‑pay. By that time Showtime and HBO had begun to differentiate themselves. It was harder to wedge our way in. While the Channel's doing well, I think that was an opportunity that will be forever missed.

FROKE: During the time period of 1977 to 1980, when the Disney Channel was launched, what were some of your strategies in selling the Disney people on the Disney Channel? Did you go back every year? Periodically?

JIMIRRO: You have to remember that Disney at that time was a very familial and collegial place. It wasn't as if you had to go make an appointment. Card Walker, who was my boss and a wonderful person, and I, were very close. Donn Tatum, who was the chairman at the time Card was the president, was a great visionary. He and I were close. It was the kind of thing where I just kept talking it up. If I may say so about myself, I had a good balance between being tenacious and strong‑willed about it, while not being, if I can use the expression, a bitch or a pain in the neck. It's possible to oversell your boss. I always had to remember that while I believed that I was right that we should have a channel, Card had his own imperatives, too. He was trying to get EPCOT built. He had a lot of things on his mind. When you're trying to sell your boss, you also have to...

FROKE: Recognize what else is going on.

JIMIRRO: Yes. You don't know everything that he's got to worry about. I think I did strike a balance. I was a constant advocate but not in a way that was offensive to anybody. During that period of course we were getting into the home video business. While we planned the Channel in 1977, other things were around. The home video business was in '80, Fotomat in '79. So there was a lot else going on in my life. I never, of course, ever gave up the idea that we should have a Disney Channel.

FROKE: How did you refine the position on the Disney Channel from the early proposition that you made in 1977 to the actual launch in 1983? In other words what were some of the judgmental decisions that lead to the more costly approach to getting into the market? How did all that come about?

JIMIRRO: It was just the natural evolution of responding to what we'd have to do to be at all competitive.

FROKE: So each year you updated your plan based on what was happening in the cable industry?

JIMIRRO: Exactly. As I said, you go back to '77. Of course there was no original programming. Nobody had even thought about doing original programming. Then all of a sudden HBO and Showtime started to do some original programming. There used to be one transponder, then there were two transponders. They were on 18 hours a day, then they were on 24. It just became obvious that the opportunities were still there, but more investment was required.

A pay television network in 1982 and '83, however, was simply a different animal than it was in 1977. Whatever you did, if you wanted to be one, you had to look pretty much like they looked. Now there is another matter that should be mentioned here. You may or may not remember, Marlowe, but there was the whole episode with Westinghouse.

FROKE: Oh, yes. Westinghouse was to be a joint partner initially?

JIMIRRO: Yes. I think a lot of people do not know the real story of that. It's one that I was the centerpiece of. When we finally convinced Card that we ought to have a pay television service, he somehow wanted to have a partner.

FROKE: Was that to tie in the Westinghouse cable systems? At that time they still had quite a few cable properties.

JIMIRRO: It wasn't related to that. He believed that he did not want to shoulder the whole financial burden, the whole creative burden. He just believed that it was so big that he wanted to have a partner. That was a very strong inclination that he had. I was unalterably opposed to that. This is as clear as I can make it. I felt that I understood the overwhelming scope and importance of the Disney Channel. That it was totally dependent for its success on qualities and assets and attributes and values that Disney and only Disney could bring to it‑‑from the name to the library to the public franchise, and that there was no reason in the world for our company to share that monumental opportunity with somebody else.

It was as simple as that. We had everything that you could possibly need and the assets that we didn't have, we could buy. We had the Disney name, the Disney library, and the Disney consumer credibility. It just didn't seem to me that all this should be shared. That was a schism that was very powerful. Yet Card had his own reasons for disagreeing with that. Actually the service as a partnership was shopped quite a bit. We actually went to HBO and asked if they would like to be a partner with us.

FROKE: That was when you were thinking of it being a segment within a broader programming service.

JIMIRRO: No, we were actually talking about a new, separate service.

FROKE: A totally separate channel.

JIMIRRO: During that period I was doing my duty trying to get for Card, a partnership, but going back to him and saying this is a mistake. I don't think we should do this. We went to HBO and said, "Would you like to venture in a new service called the Disney Channel. HBO turned us down. Jim Hayworth (from HBO) would later come to me and say (and this is just a little anecdote which is interesting) "This is one of the biggest mistakes we ever made. We should have said yes to you then."

We went to some others. I think Warner was one and finally to Westinghouse, who said yes. That was a bad day for me because I had been doing my job and shopping for a partner and finally, succeeded. I went back and it was definitely an ambivalent day. I said, "Card I have your partnership, I think this is a mistake." We then negotiated this deal with Westinghouse for a twenty‑year partnership. We negotiated with Russell Carp, I remember it so well. We're now talking summer of '82. Ron Cayo and me. Ron Cayo being a business affairs person would go back to New York and negotiate with Russell. We negotiated this deal in the summer of '82, often at Russell Carp's home. Then Russell Carp hurt his foot. We did negotiations in the hospital. It was an ambivalent time. I remember wondering "Why are we doing this?" I'd come back and say, "Why are we giving half of this away. Only Disney can do the Disney Channel."

By the end of the summer, we had pretty much negotiated the deal and had a handshake, but nothing signed. This was August of 1982. There was another thing I want to mention. One of the big issues that made me crazy in that period, was Westinghouse saying to us that one of the things we'll have to do as soon as we get this deal signed is figure out what the name of this network is. They were already being a little provincial. This was driving me crazy. Should we call it Carousel, or whatever. I said, "What about calling it the Disney Channel?" They would reply: "Well, why not call it the Westinghouse Channel?" That's what was going on. That was exactly the reason that I was so opposed to this; the values that our company had. You venture with another company and they feel a little provincial because they want to be equal. They were proud of what they did. This was a great company, but they obviously didn't have the values for families and kids that our company had. I take nothing away from them. But, the more I heard things like that, the more I said, "These are good people and I like them, but why would we give away half of this network?"

FROKE: And part of the identity.

JIMIRRO: We finally compromised and decided to call it the Disney Channel: a service of Westinghouse and Disney. Westinghouse would get their name first. So during that period, I'll use the word again, I was ambivalent. I was negotiating the deal because I'm a good soldier, and going back and saying this is really wrong.

For reasons that I can't understand, at the eleventh hour, after the deal had been negotiated, not signed, I went in to Card one last time. (I'm telling you this story because a lot of people don't know this story.) I saw a report...I'm jumping ahead...in Business Week later that indicated Westinghouse extricated itself from this deal. As far as I'm concerned I am 100% responsible for this deal falling out even though Card made the final decision. I was the one. (I had a lot of people with me, by the way.)

Anyway, I prepared some final numbers and showed Card some of the projections. I said, "Card, we're about to sign the deal, but let's just look at this one more time. Look at what this channel could represent on a worst‑case basis. We're talking 20 years here. We're talking Mickey Mouse. We don't have a partner in Disneyland. Are you sure you want to do this?" Something snapped in him like that. For months and months of his being quite intransigent about it, he said, "I agree with you."

He called Dan Richie who was on vacation in Colorado. I understand Dan was the second largest land owner in Colorado. He said, "Dan, we have to talk." Dan came off his vacation, and we had a lunch in a private dining room at the studio. Card at that lunch did not extricate himself from the deal but said the following. He said, "Dan, I just had a second thought on this." At the time of the deal, everything was going to be 50/50‑‑creative input, control, everything. Card said, "Look, we're willing to make this deal with you, but we're not willing to give up creative control." That was how it went. "We must have complete creative control. We must have complete control of the marketing, any use of our scenes and symbols, programming and characters. We'll renegotiate the deal so you can provide technical or sales, and we'll give you a piece of it, but we won't make it a joint venture."

If we had gone first to Westinghouse with that deal they might have accepted it, but this was a come down from what they were now anticipating which was a total 50/50 partnership. Dan was a proud man. He said, "Card, I have to think about that." Dan called back two days later and said, "Card, it's all or nothing at all. We have to have a 50/50 deal with you or else we're pulling out of the deal." Card said, "O.K. so be it." That was in September of 1982 when I, in the final analysis, was successful at the eleventh hour in extricating ourselves from that arrangement. That's the true story of how it happened.

FROKE: Have you any idea of what it was that you said in that conversation. What was that something that snapped?

JIMIRRO: I just wonder in retrospect, Marlowe, whether he had those concerns all the time. Card had never worked anywhere but Disney all his life. Nobody in the world knew more about the Disney franchise or the Disney quality or the Disney values and what Disney brings to the table more than Card Walker. Certainly not me. Card was Walt's right hand man from 1937. It may be that when it came to the moment of truth with that 150 page document in front of him and it said 20 years, 50/50 ownership of the Disney Channel, there may have been something lurking in him all of that time that just snapped.

The thing I showed him at that last meeting was numbers. I remember that. It was a pure financial presentation at that time. I think it was basically him knowing what he knew all the time. By the way, it was an unassailable position if I do say so in retrospect. No business person could look at everything that was going on and run it through a computer and say Disney should give up half the Disney Channel. It would have been a joke, really. Disney had its own niche. It was a family niche. There are certain things that Disney did better than anybody else in the world and was perceived that way by American families. That was what I hated to give up.

FROKE: To break into cable television at that time, you had to have some distribution capabilities. When Westinghouse no longer was a joint partner, you had to have some distribution capability within the cable industry. To whom did you turn then, to make it a viable proposition for Disney as a separate company? In other words who did you court in terms of gaining channel capacity?

JIMIRRO: I remember Card calling me and saying that although we were planning to launch the Channel April 11, 1983, "we don't have Westinghouse, you've lost a little momentum. I think we ought to delay the launch." I remember saying, "No, we shouldn't delay the launch." At the time I felt that we had lost a little credibility. A lot of people were saying, "Are these guys really going to do it?" One of the things you have to remember: just prior to the launch of the Disney Channel, CBS Cable had failed. The Entertainment Channel had failed. That was a joint venture with RCA and Rockefeller Center. There were a lot of cable operators who thought maybe there weren't going to be any more pay or cable services. That was long before Discovery and Nostalgia and Travel and Weather. This is a time when people were saying, "We've had two failures, one by CBS and one by Arthur Taylor and Co. So there were a lot of questions about whether there should be a Disney Channel.

So, Card said maybe we should delay the launch and I said "No, we really have to launch this Channel. We can do it. We can do it, and make it work." He said, "O.K. If you really believe we can do it, we'll keep the launch date." The only thing we did was change the launch date one week to April 18 because we found out later the Academy Awards in 1983 were on April 11 and we didn't want to compete with them our first night on the air. We did not have any distribution capabilities, Marlowe. We did not have any contacts. We did not have any great, established cable relationships. What we had was something I knew, despite the number of pessimistic people in those days who doubted we could do it better than anybody else in the world. I knew there was an untapped segment of the market out there.

In all of the panoply of services that were being offered at that time, there was a group of people who simply were not being served. These were people who didn't want gratuitous sex in their homes; they didn't want violence in their homes. They were enlightened parents who wanted a different kind of programming for their children. That's something that many people didn't understand. CBS Cable, whatever it did right or wrong, didn't serve that market nor did it intend to. The Entertainment Channel, whatever it did, didn't serve that market. I knew that market was there. Unless you worked at Disney, you might not know that. I knew who those people were. They were the ones who were writing us all those years. They were the ones who were saying, "Thank God for Disney." I'm not being righteous about this. I'm just saying that I knew that market was there. That's how I always approached things, from the standpoint of the consumer. I didn't know how many at the time, whether it was two million or four million or six million, I knew it wasn't 50 million. But there were certainly several million families out there that were not being served.

You could look at all of the surveys of people who weren't taking pay services. The first reason people weren't taking pay services‑‑cable homes were rejecting pay‑‑was they didn't want sex and violence in their homes. Those people may have been happy to have no pay, but I also know that these were people who were one time cable subscribers and were saying, "There's nothing on here for me. I don't want HBO in my home." Disconnects. Again, I'm not making a judgment about HBO. I'm just saying that I knew about that unserved market.

FROKE: One or two channels, other pay channels had come on that unfortunately labeled cable television as being something that was not necessarily desirable in the home. Fundamentalist churches, for instance, have strong opinions about cable.

JIMIRRO: Anybody who was even an industry observer would say, "Disney can't make it." CBS didn't make it. The Entertainment Channel didn't make it. But those people were not in the family market, as such. They were more mainstream programmers. They weren't attuned to that opportunity the way you might be attuned if you had been serving that market all those years, as I had.

FROKE: You still had to deal with the question of channel capacity. You still had to find cable systems to carry the program service. How did you make the arrangement with TCI then? Because if you had not had TCI it would have been much more difficult.

JIMIRRO: I remember exactly how that happened. Somebody else did it. Not me. It is a great story. In the fall, after the separation from Westinghouse, I had gone out to see all the MSOs. It was a way of saying we're here. We're going to be on the air and this is what we're going to do. These are our plans. Get ready for us. We started the process of putting this together in October of 1982. Interestingly enough, seven years ago today, more or less, literally seven years ago today, plus or minus a week, I got a call out of the blue from John Malone. John Malone who I had not seen on that trip called me and said, "Jim, we're going to support your channel. We want to sign a system wide deal with you. We want to be your first MSO and we're with you all the way. Our business needs this kind of channel. We need Disney to be part of what we offer. If we're going to offer Escapade (or whatever used to be the predecessor of Playboy) if we're going to have R‑rated pictures on HBO, which is fine, we must have Disney. Disney will enable us to round out our offerings so we serve the maximum number of people. We want to be with you." That's how that happened. It's as simple as that.

An enlightened man, who, for whatever reason believed Disney was going to be important. Who knows what his motivations were. He thought there was a customer base out there. He also believed if he had to go to Washington to say anything it would be nice to have Disney as well as other services. John was the one who was forthcoming. He called me out of the blue. Of course that was probably the greatest single day that we had. Here was the biggest cable operator saying we support you. As a matter of fact, when we went several months later to one of the cable shows, we used footage of John Malone saying this is going to be the service that will work because we need this service. Without this service we don't have a complete cable system in this country.

FROKE: It was about that time some of the leaders of the cable industry were beginning to say the future of cable television rested now in programming and not necessarily with technology distribution. Cable television had to be more than simply distribution capability. To the best of your knowledge Malone was following the development of the Disney Channel through the trade press as compared to you or your staff being on his doorstep selling it?

JIMIRRO: We had gone out to TCI. We were talking with J.C. Sparkman, and John Charlton, I guess, was there at the time. But we had never really met with John Malone himself.

FROKE: That's an amazing story.

JIMIRRO: Imagine sitting in your office. You get a call from John Malone. He was just unequivocal about it. He said, "We're with you."

FROKE: And he wasn't on his boat either. Going back, let's say now that distribution is assured. Certainly that did not take place first, what were some of the things you did to program the Channel? How did you put in place a programming philosophy?

JIMIRRO: First it was important to know who did it. This is another aspect I think is very important about the Channel. I never conceived the Channel as having to be some big Hollywood infrastructure. I had a number of extraordinary people around me. I would say from 1974 until this period, I had really developed a strong group of people, many of whom had worked in educational films, believe it or not. Many had done all other kinds of programming for me. I had this wonderful brain trust of programming people, many of whom, only by coincidence, were women. Many of whom were ex‑school teachers, and all of whom were very bright. Peggy Christianson, Judy Rothman, Laurie Levitt, Pam Hansen. These are people who had worked for me since the mid‑1970s. These people became the programming staff of the Disney Channel.

There's a lesson in that in terms of how I function. My inclination wasn't to go to the Hollywood community and hire some "heavyweight" person for an enormous amount of money, but rather to go with our home‑grown people who were conscientious and committed and dedicated and who understood what our audience expected of us, which was so important for Disney. People had a certain expectation.

You make it in business by serving people in terms of their expectations. Peggy Christianson, ex‑school teacher, ex‑producer of educational films, and bright as a penny, became vice president of programming for the Disney Channel. She put together this brain trust of people. They developed most of the programming.

We made a decision early on that the Disney Channel was going to be programmed on three legs. One third of it would come from the existing Disney library. It would have features and cartoons and short subjects. One third of it would be acquired programming from around the world. And one third of it would be original programming. We believed that over the long run, the original programming would be the most important. We would get people to come to the Disney Channel because of the Disney library‑‑Mickey Mouse cartoons, and "Old Yeller" and feature films, and so forth. Eventually we would have to wean them onto our new programming due to the fact that our library was obviously finite. Our original programming was going to be the most important over the long term.

We ended up developing most of the original programming ourselves. Peggy and her people did it. We ended up signing on the air with thirteen original series' of programs. We spent $44 million on original programming in the first year of that channel. All of it was developed by a brain trust of people who had been Disney employees. In no case, outsiders. They were people who had grown up with the company, who I trusted, and with whom I had a wonderful relationship, and who were just elevated to this task. That's what's so interesting about it. We got that channel on the air in record speed, six months, and yet didn't use any of the expected people. We used our own home‑grown people, many of whom, I would venture to say, could not have gotten jobs that important elsewhere in the industry. I think if Peggy had gone out in 1982, she might have been hired as a programming administrative assistant at HBO and would not have been perceived as somebody who could run the programming department of a network. Again, sometimes you can do more with home‑grown dedicated, committed, people than with others who may have a different perception of themselves within the community.

FROKE: What were some of the programs you did in the first year in the original production category?

JIMIRRO: We did two children's programming series, both of which are still running on the Disney Channel and both of which continue to be, in my view, the most important original programming series that were ever done for the Channel. One is called "Welcome to Pooh Corner." The other one is "Dumbo's Circus." "Welcome to Pooh Corner" was on the air on Day One. We had 120 half‑hours of that. That continues to be a mainstay of the Channel. A puppetronic show based on the Pooh characters. We liked "Welcome to Pooh Corner" so much, I said, "Peggy, we ought to do another one of those. It's a great thing. We can run it forever." We went back to the same producer, Frank Brandt, and said, "Let's do another one." And they came up with the idea of "Dumbo's Circus" based on the Dumbo characters. Both of those will run forever on the Channel.

FROKE: These were independent producers who put these programs together?

JIMIRRO: We used a man named Frank Brandt. He's done a lot of work for Disney over the years. That was a hand‑in‑glove arrangement between Peggy and her people and Frank Brandt and his production staff. Frank is a uniquely committed producer of children's programming who does things with uncommon love and care and affection, and it shows in the program. Those two shows represented important ones.

Then...another example...we wanted to tie‑in with EPCOT. The whole idea of synergy was important for the Channel. We did a program on Day One called "EPCOT Magazine" which was a daily half‑hour that actually originated from Walt Disney World in Florida. That was our conception. It was done by Bob Hillier, a producer hired by Peggy and her people to do this show. The other shows were all mainly coming out of the Disney experience. For instance, one of the great Disney songs is "When You Wish Upon a Star." They came up with an idea of "When You Wish Upon a Star" where we would feature young kids wishing something and making that wish come true on the air. Whether that wish was to ride in a helicopter or see what it's like to be on an aircraft carrier, or whatever. That was done by a man named Arnold Shapiro.

We did a show called "Contraptions" which was a game show that used segments from Disney animated films like "Bambi" and "Snow White" which again was able to be an original show yet draw from material that was uniquely Disney. We had to do an exercise show called "Mousercise." We did "Mousercise" with Bob Banner, one of the great television producers of all time, really. He has been producing since the early years. Bob did "Mousercise."

FROKE: He did the Waring programs that were on television in the early years.

JIMIRRO: Exactly. He was an early entry. We did another show that I loved. Again, this was Peggy coming up with the idea. I just loved this show. It's called "You and Me, Kid." It was a show designed to allow parents and their kids be interactive with the show. If a parent and child wanted to spend quality time together they could spend time in front of the Disney Channel with games and stories and interactivities between the two. It was a chance for Disney to be at its best. To bring a mother or a father or a grandparent together with a child for a half‑hour in a quality period. I used to cry when I'd see that show.

That's when I knew the Channel was going to work. Nobody else was going to do this. This was something that many families wanted and were not getting in the marketplace. That exemplified why I always knew this was a different kind of pay service. It had nothing to do with earlier failures that were not serving this particular market. Those were some of the shows we did.

FROKE: With your experience in the international market, you probably knew some of the contact people in other countries to help in acquisitions, a second category of programming.

JIMIRRO: Not only in terms of acquisition but also in terms of co‑production. We did a lot of co‑production at the Disney Channel. For instance, we did a Western series called "Five Mile Creek" based on a Louis L'Amour book. "Five Mile Creek" was actually done in Australia along with Channel 9 down there as a co‑production with a part American and part Australian cast. With Michael Hirsch at Nelvana Productions in Canada, we co‑produced a series called "The Edison Twins" which is still running on the Disney Channel. With another Canadian organization in Vancouver we co‑produced a series called "Danger Bay." It was a dramatic action series with kind of a scientific underpinning to it. It had some educational value. We produced a movie in Spain with an English producer; Harry Towers called "Black Arrow," which is based on a Robert Louis Stevenson book. There was a lot of international co‑production going on at that channel, which was very, very exciting.

FROKE: The third major category‑‑programming from the Disney library: you had full access to everything that was in the library?

JIMIRRO: No, again going back to those theatrical people. They were fairly provincial. We had access to all the cartoons and we had access to almost all of the live action movies. When it came to the so‑called family jewels, the 23 or 24 animated classics like "Bambi," "Snow White" and "101 Dalmatians," we really didn't have much access. There was some concern about, (I think this was legitimate) taping off‑the‑air and damaging theatrical reissuing and all that. That has lightened up considerably with the new Disney management. In those days we were relegated to everything but the top echelon of programming. There was still enough, certainly with the cartoons. We did run "Mary Poppins," and "Tron" and "The Black Hole," and so forth. There was enough to give viewers a little taste of the "crème de la crème" of Disney although we didn't have unfettered access to it.

FROKE: You had the opportunity to promote specials by using "Mary Poppins" and a few others.

JIMIRRO: Yes.

FROKE: On the pay channel arrangement, the programmers get a percentage of the income and the distributors get a percentage of the income. What types of deals did you cut with the cable operators initially?

JIMIRRO: The initial deals were roughly in the range of one third to two thirds. That's really what it was, plus or minus two or three percent. We were getting about a third of the take. If the Disney Channel were being sold for $10 we were netting about $3.33. That's pretty much the way it works. In retrospect I think as an industry standard that's an unfair cut, I think it should be more like 50/50. But, it grew up that way. The reason I think it was unfair is that the premise originally was that the cable operator was going to do a lot of the marketing. As it turns out the cable operators didn't do any of the marketing. We did it all. We had to program, create the service and do all the promotion for it. Yet we're still only getting a third. I think that was part of the imbalance. I think that's an industry imbalance. It's difficult for any one product to change the essential terms.

FROKE: You had to create all of the promotional materials also.

JIMIRRO: Yes. And, in that regard, the other thing that we should mention at this point is The Disney Channel Magazine. That happened to be my idea and I think one of the most important ideas we had ever had. I'll tell you where that came from. We used to do educational films in the '70s. One of the elements we always included‑‑if we did an educational film on how to get to school safely, for example‑‑would always be a teacher's guide. So, I began to understand the role of printed material along with audio‑visual communication that supported that communication. It was as simple as that. I said, "Well, it might be great if we could have a magazine to enhance the experience of the Channel. If there were games and activities and program information, follow‑ups, parent's guide. Watch the show and there might be some things for you to talk about around the dinner table. Wouldn't that really make the service much more meaningful and much more beneficial?

The premise was that anything we could do to create more subscriber value would aid retention and help acquire new subscribers. A lot of people were negative about that magazine because it was expensive. The magazine ended up costing about 32 or 33 cents a subscriber. When you're only getting $3 or $4 that's a lot of money. I remember being on a panel in December of 1982 with Paul Klein. Klein was running something or other, maybe the Playboy Channel. Paul, who was never one to be reticent said, "You can't afford that magazine." I said, "We can't afford not to, Paul."

End of Tape 1, Side B

FROKE: This is Tape 2 Side A of the oral history of James Jimirro. Because television has a tendency to be transitory...it's here and then gone...you almost need the print material to make people believe that yes, it is real.

JIMIRRO: The magazine was an exciting concept. Again, I should tell you that that magazine was created not by me recruiting someone who had been the editor of Time magazine or bringing in an established person, but rather by young and enthusiastic people who had been working for me for several years. Elaine Overby was the editor. Linda Palmer was the publisher. They were just young Disney hands. They got that magazine done. The magazine was a real crunch because, while we had to launch the Channel April 18, '83, in order to promote and get the magazine distributed, we had to have the first issue completed by February 18. It was certainly early to mid‑February. There really was a tremendous time problem. Yet they got that first issue out and got millions of them printed.

It was just remarkable. After I came up with the idea of that magazine I read something in a marketing book that essentially reflected my thinking. In marketing, the most exciting thing you can do is not just sell somebody or communicate with somebody, but to also have a relationship with them. If you can create a relationship with a customer or a constituency, then you've achieved the highest level of marketing. That's exactly what that magazine was intended to do. It was intended to draw those consumers into a relationship with the Disney Channel and help complete the entire concept I had for that channel. Rather than having it be like an august mass medium, like for instance NBC, with essentially one‑way communication, I envisioned, because of the friendly, congenial image of Disney, that we should have a more participatory, interactive, involved relationship with our customers. People who love Disney would want to feel part of that channel. We did a lot of different things to create a different kind of relationship, almost an interpersonal relationship.

People would say to me, "If that's a good idea, why doesn't HBO do it?" My response was, "It's not a question of a good or bad idea, it's a question of appropriate idea." HBO couldn't do that and shouldn't because nobody feels about HBO the way they do about Disney. What you need to do when you're creating a product is use whatever particular assets and values you have. Disney is not intrinsically better or worse than any other institution. It's just what it is. That magazine and other things we did on the air were all designed to create a relationship with people which was different from Time magazine or CBS. Disney was different. I think that all worked in terms of subscriber retention or satisfaction.

FROKE: Did you address the magazine primarily to parents or to children or to both?

JIMIRRO: Exactly to both. What we had was a magazine for parents with a pull‑out kids' section. That was the whole idea. The parents could read it and do whatever they would with it but then there was a section "Just for Kids." That was the section that had features like connect the dots, cut‑outs and make your own Christmas tree at Christmas, and all kinds of activities. It was just for the kids, separated out.

FROKE: In a sense it mirrored the one program that you put together that brought the kids and the parents together.

JIMIRRO: Yes. You know, it's an interesting thing. When I left the Disney Channel, naturally new management would come in and take a look at everything. In fact one of the proudest realities in my life was that, as the new people came in, they didn't change anything really. One of the things they were concerned about was the magazine. They said, "Gee it costs 35 cents. We'd better look at this and see if we should spend that amount of money. If we didn't publish that magazine, we could save a lot of money." They went out and spent, I think, quite a bit of money doing research on the value of The Disney Channel Magazine and concluded that The Disney Channel Magazine was one of the most important parts of that service. We knew it all the time but they did some research that proved it.

FROKE: Was the magazine solely a marketing strategy or did you also sell it?

JIMIRRO: The answer was no and no. It was not only a marketing strategy but we never sold the magazine. The idea was to produce revenues by getting advertisers for the magazine. That wasn't the primary idea. I never said it should be a profit center, but I also felt that if it could get enough good circulation and readership we might be able to help pay for the magazine or maybe pay for it entirely.

That's exactly what happened. Slowly but surely, as we got three, four, five million subscribers. That's a pretty big magazine. That magazine has a bigger circulation than Time or Newsweek. It became very attractive to advertisers so that there's a chance to at least recoup some of the cost of that magazine, which is now, of course, happening. We also would sell merchandise in the magazine. It was a wonderful way to sell some merchandise. I want to point out that those were always ancillary activities. It was always intended first to enhance the value of the service and be part of the service. We were willing to pay 35 cents a subscriber to do that. The fact that we could lay off some of that and sell some merchandise was an important afterthought, but indeed just an afterthought.

FROKE: In a two to three year period it's rather amazing that the effort became profitable. The Channel broke even by 1985. Was there ever any pressure within the company during those two or three years to discontinue because of the deficit? If I recall I read someplace that during the first year you ran $55 million in the red, so to speak.

JIMIRRO: We were never off our plan, and that's the happy truth. We were never off our plan.

FROKE: You said three years?

JIMIRRO: No, I think it was two years and two million. Two years and two million had us to March of '85. The fact of the matter is that we broke even with the Disney Channel with 1,800,000 subscribers in January '85. We needed 200,000 fewer subscribers and about three months less. We announced break even in March of '85. I still remember it. I remember we had a press conference at the Beverly Hills Hotel to announce break even. We actually broke even in January of '85. The reason we didn't announce it then was because the shareholders meeting was coming up in February of '85 and there was lots of news going around. I felt that we should have that announcement separated out in a way. I prevailed upon my bosses to just hold off so we would be clear of all the other exciting things that were being announced, and they agreed.

We announced it in March, but we broke even in January of '85. The losses up until that time were anticipated losses, so there was never any pressure. Day‑to‑day there were enormous problems of course in running something of that scope, but it was never off target so it was never a problem.

FROKE: You were getting positive feedback from the corporate executives during the time, too.

JIMIRRO: Just think, you have that initial growth period. You're getting new subscribers all the time, new cable systems all the time and new credibility. I remember little victories when the Disney Channel came on the air. Every time it was announced or mentioned in the paper, reporters would say, "The Disney Channel‑‑Disney's cable network." I remember the first time I read a report and it just said the Disney Channel and the reporter felt he didn't have to describe what it was. It was a little bit of coming of age. Getting listings was another victory. TV Guide wouldn't list the Disney Channel for the first few months because we didn't have enough subscribers. I said, "Boy that really seems wrong." Then they showed me something. With 17 million circulation it would cost TV Guide $40,000 a year, or whatever it was, maybe a week, to list a new service. So it was a big deal for them, but we had to fight those battles market by market to get enough subscribers and to get enough credibility to get listed. Those are the exciting things about starting. Then I'd be in St. Louis and I'd pick up the paper and the Disney Channel would be in the listings. We had enough subscribers.

Now it's obvious that Disney Channel is a fact of life. They list it everywhere but those were the victories along the way. You'd go into a market and you wouldn't see the Disney Channel listed. You'd say, "Why can't we be listed?" Well, you didn't have enough subscribers and you'd just use up the ink. When you're going through that, sure you become a little impatient and want it to happen faster. But in retrospect, it happened pretty much on schedule. That's the reality of being an entrepreneur. You've got to wait for successes as they unfold rather than just have them be a fact of life.

FROKE: Breaking even was a boon to the cable television industry, also. During that time period, as you mentioned earlier, there were a number of programming efforts that were going belly up in cable TV. There were a number of people in the early 1980s who were saying, "Maybe this is coming to an end now. The cable business is sick." When you came on with your profit announcement it really gave a shot in the arm for the rest of the programming side of cable.

JIMIRRO: Of course. It's interesting, on a broader view, that cable programming then was at the beginning, rather than the end. You never know. I'm not sure why I was particularly this way but somebody once characterized me as "declarative." Everybody knew that it was two million subscribers to break even. Everybody knew we had said we were going to get there by the spring of '85. I'm not sure why we were so declarative. Maybe it was my way of wanting to set clear goals for our employees. We were declarative, so when we did it, it became even more interesting because we had stated our goal.

By the way, we did have a tremendous esprit de corps at the Disney Channel. Everybody knew about the two million. We had a big chart in the lobby just like the old Community Chest charts. We'd show the two million break even. And if we had 1.3 million, a line would go up; and 1.4 million, the line would go up so that everybody at that channel from the executives to the secretaries to the clerical people knew that we needed two million. And that was important. The people had a feeling of being part of a broader goal than simply doing their own job. That was great spirit there.

FROKE: As you talk about the success that you realized in cable, it brings back a moment of reminiscing which links you back to Penn State again. At about that time, we were meeting with the cable television industry to establish a Cable Television Museum at Penn State. The Pennsylvania cable industry had been very, very helpful at Penn State in a wide variety of ways like helping us organize a statewide network we call PENNARAMA which is a statewide educational network. In the one step of taking a broader perspective of our School of Journalism and the radio ‑ television instructional program at the University, the new president who came into Penn State at about that time, Dr. Jordan, wanted to see a School of Communications or a College of Communications established. He asked if I would work on the preliminary organization.

Cable was one of the main areas I wanted to see introduced in the curriculum in a broader way. You then were one of the advisers that came in. George Barco was one of the advisers that came in. Jim Mooney was one of the advisers from NCTA that came in. Something happened in a relatively short period of time. You were at Penn State and we had some real nice conversations. You had been named a distinguished alumnus of the University. Then I saw you out at the National Cable Television Show in Las Vegas, I believe it was. A short while later I read in the trade press that you were no longer president of the Disney Channel. Can you tell me what happened?

JIMIRRO: As you know, Disney had a management change in September of '84. I had been at Disney from '73. The new management came in. They were very good to me. In fact, there's an interesting anecdote. The Disney Channel office was off the Disney studio lot, as we just had too many people to stay on the lot. Michael Eisner, who was the new chairman of Disney, really didn't know where anybody was of course. I guess Michael Eisner had known a little bit about me since he was running Paramount. I think he had reason to think I was an O.K. person. I'm not exactly sure why.

On a Thursday, his fourth day there, he said, "Can you come over to my office, I want to talk to you?" He didn't know that I was three miles away nor did it matter because he was the boss anyway. So I got in my car and drove over there and was in his office in ten minutes. He was sitting there with Frank Wells, and he said, "You're the first person at Disney we want to stay. We want you to stay." His syntax is off, but that's how he said it. "We want you to sign a seven year contract which is the maximum allowable by California law and we want you to be part of this new team." I said, "Well I love this company and I've been here a long time and I'd like to do that, especially if the Channel is about to break even. It may break even next year. I've worked ten years of my life on that channel."

So we had a really great honeymoon period. Even more so because Eisner was a man who wanted to know so much. He was obviously curious and anyone who is effective in life, in my view, is curious. Michael wanted to know everything about Disney. He was trying to grab hold of this new corporation he was running. I was one of the persons he glommed on in that regard.

We had a press conference in New York with Chuck Dolan; I think in October, right after Eisner got there. That was when we announced the long‑term distribution deal with Cablevision. I said to Michael, "Would you like to come back to this press conference? It would be great to have you there. It would show your faith in the Disney Channel and it would be interesting for you as well." He said, "Yeah, I'll come back." So Eisner came back for this press conference. My plan was to go from Los Angeles to this press conference in New York and then over to a convention I had to attend in Europe. Eisner was going to go to the press conference and back to L.A. I had two days between the press conference and this European convention. Michael said, "You've got to go back to Los Angeles with me. I've got to talk to you." I said, "What? I've got to be in Europe." He said, "Come back and you can just fly from Los Angeles. It's a perfect opportunity for us to talk." What was going on was that this was a chance for him to spend six hours just picking my brain because he wanted to know so many things. Naturally, him being the boss, I said "Of course." I got on the plane, a Regent Air, which is almost a semi‑private plane. For six hours we just talked and talked. And he was actually saying, "What about this guy? What about that guy?" You know ‑ asking me to help him evaluate everything. Just trying to collect all this information. I was one of his key purveyors of that information. We had those six hours and another hour to the airport. I said good‑bye, got on a plane and went all the way over to Europe.

That was how close I was with him. Actually I was happy to do it because, if I had been in the same situation, I also would have wanted to know everything. If I found a person I thought I could trust and believe, I'd want to spend a lot of time asking him so many things.

In about February of '85, Eisner and Wells, because they're strong people, began to feel the confidence they didn't feel at first; they thought they were in charge and they knew what they had. They began to get more and more involved in things, including the Disney Channel. That bothered me a lot. I didn't like the way they were meddling. That's the word I used, although acknowledging they had every right to do it. I want to make that very clear. Somebody once said to me, "He may not always be right, but he's always the boss." I really believe that. I think one of the reasons I've been successful in corporations is because I may be a strong person and have a lot of ideas, but I'm never unaware of the role that the boss plays. I was running the Disney Channel but when my boss needed something, that was my first obligation. That's just the way it is. You should always demonstrate respect for your boss and if you can't, you ought to leave. That's how I feel. That doesn't mean you're weak, it just means you try to support your boss.

It was their company at that time. They certainly were going to run it differently. I had had a tremendous level of autonomy within that company, more than one would normally expect in a large corporation, and I was used to it. When they began to become involved in the Channel, I would respond with one of two varying responses. Sometimes I'd wake up and say, "Let them be involved and let them do what they want to do. I'm president of the Disney Channel. I'm making a lot of money. I've got some status. If they want to run it their way, I could just sit here and do whatever I do and so be it." Other days I'd wake up and say, "This is not right. I created the idea of this thing. I've worked so hard on it, I really should be able to continue to run it."

Always knowing there was no blame in this, slowly but surely my own inclination was that it was bothering me too much to live that way. And that's what was going on. It took three or four or five months for me to come to the ultimate realization that it was too unpleasant to have what I characterize as interference, but again, by people who had every right to interfere. I had been too used to having autonomy. I had been too spoiled, or whatever the word is.

Another point: we're all living out our own styles and personalities. I happen to be a person who happens to work better with maximum freedom. J2 COMMUNICATIONS is ideal for me because I have only a board that I report to. On a day‑to‑day basis I have total autonomy. I had the same level of autonomy at the Disney Channel, even though I was working within a large multi‑national corporation. I had that much autonomy. I just thrive on it. It's just what works for me. It's just my own personality. That's essentially what happened. My leaving there was for exactly the reason that 99% of people in senior positions leave...because of a chemistry problem or a style problem. So many executives, when that happens, end up blaming or having bitterness. That's always so inappropriate. It's just the luck of the draw. It's just how people mesh (or don't mesh) together.

That's the reason for the decision. I don't look back on it except philosophically; it was just the way it worked. I certainly had a great run there but I've never had any regrets. If I ever think, "Well maybe I should have stuck it out," then I remember certain instances and how they gnawed at me. You might think, "Gee whiz, I gave up a pretty good thing there. I don't think that now because this new company is so rewarding. You think, "Did I make a mistake?" To handle that, you think not about the broad view but about days when you just went home being so unhappy and frustrated, or when you remember those specifics. You realize you didn't make a mistake. You don't want to gloss over that when you're going through that kind of hell. And again I say that without blame. It's very difficult to live that way no matter what kind of status or money you're making.

FROKE: What were some of the decisions that were being made by Eisner that particularly bothered you? What is the programming philosophy?

JIMIRRO: Frank Wells was actually more involved in the problem than Eisner. MGM had come to us wanting to license a substantial part of their library to the Disney Channel. That was one of the most exciting opportunities we could have ever had. One problem we had was that we lost much of our viewership at night. I began to understand very early on that we had to create two channels there, one for the kids during the day and one for the parents at night. That was a very early on concept I had. The MGM library was a perfect way to do that. Because it was a fairly big deal, I got these guys involved in it. Essentially, Frank Wells got so involved in that deal that he ended up blowing it. I won't go into the detail. But that's literally what happened. Like a lot of aggressive people, he got greedy. We had a very good deal and he wanted just a little bit more. He pushed MGM over the line and they said, "We can't do it." And we lost that deal. Losing that, we also lost a great opportunity to establish evenings as a "second network" and also maybe keep viewers as subscribers even after their kids had grown up because they had gotten used to the quality programming at night.

FROKE: It gave you a practical way of implementing audience flow within the total programming.

JIMIRRO: We actually had a whole campaign: Two Channels in One. Things like that. MGM would have been the product. It would have just been fantastic. It would also have changed the course of entertainment history. MGM wouldn't have been sold for the same amount of money it was sold for. All the pay‑TV licenses would have been gone because Disney would have had them. There was a man named Frank Roth who was trying to put that deal together with us at the time and a man named Sid Sapsowitz. Frank, in my view, hurt us a lot and maybe shouldn't have been involved with the negotiations. He is a very aggressive man who likes to get that last peck in. That's good, but if you push too far, you might end up losing the whole ball of wax. That's one example of specifics.

We were, at the time, trying to sell the Disney Channel in Canada. That was a very complicated situation because the Canadian people wanted the Disney Channel but the Canadian authorities and Canadian programming and entertainment infrastructure didn't want it because they didn't like the idea of Americans coming in there and pre‑empting Canadian programming, especially for young people. It was a real political hot potato that I was trying to work through by going to Ottawa and talking to the CRTC, the Canadian Radio and Television Commission. Frank got involved with that and had a lot of ideas that ended up getting in the way. That was another one.

Again, those were difficult things to live through at the time. A lot of the problems were really more picky, things like fighting with your husband or wife and thinking, "Why are we spending so much time on this." Maybe these things would have disappeared anyway, but they tend to be debilitating at the time when you are living through them.

FROKE: Did you have any face‑to‑face meetings with Eisner to talk about them, the separation from the company?

JIMIRRO: I actually had a face‑to‑face meeting with Frank. At that time Frank had carved out little territories for himself. The Channel was one of them and outdoor recreation was another. I had a face to face meeting with him. Subsequent to that meeting, they did try to get me to stay. I remember one little anecdote. Frank was trying to get me to stay and he'd called me over to his office, there were three or four people in the office. Just as I walked in, they left. Jeffrey Katzenberg was there, and Eisner and I think Rich Frank. There was a $50 bill on the cocktail table. He said, "You know what that is?" I said, "What?" He said, "I bet those guys $50 I could get you to stay." I said, "No, I don't think so."

That's what was going on in that time. We ended up parting quite amicably although later there were some disputes with respect to my severance package and so forth. To realize that you made the right decision you have to think of specific events where you'd just be eaten up, for whatever reason.

FROKE: In perspective, you have behind you the creation of one of the gems of cable programming. You know that the Disney Channel was your inspiration and you know the formative period was yours and you have a great sense of accomplishment in getting it to the American people.

JIMIRRO: I think that's right and I don't mind admitting that because I am proud of it. The Disney Channel was a collaborative effort of lots of wonderful people but I think they would all acknowledge that if it weren't for me, there wouldn't be a Disney Channel and I don't mind acknowledging I'm proud of that, taking it through the company and getting it on the air. If I had personally decided that it wasn't a priority, there certainly wouldn't have been a Disney Channel. If there hadn't been the Disney Channel idea when I was there to create it, at that point the idea would have just gone away and that would have been that. I agree with that, Marlowe. To me it's something that will always be a legacy for me. It's something about which I'm very proud.

FROKE: After you left the Disney organization, how long did it take you to decide that you really wanted to be your own boss and create your own company and establish J2?

JIMIRRO: That's an interesting question, in view of the fact that I had been at the radio station for slightly less than two years, at CBS for eight years, Disney for 14. I was a company man. Only three employers in all those years. When I left Disney it was fairly well publicized. I kept getting calls out of the blue from investment bankers in New York.

I had never thought of starting my own company. At the time the bankers were saying there's a lot more money around than there is management‑‑there's a lot of money for people like you who want to start your own company. I had never thought about it. Then a strange thing happened while I started talking to some of these financiers. I remember the following.

I went into the office in New York of a key CBS executive who was trying to get me to work for CBS. I walked into his office and I was absolutely put off by what I saw. What he was doing was essentially what I had been doing all my life, which was being an executive for an entertainment corporation. And yet what I saw in walking down all those aisles, secretaries all over the place, and finally getting to his corner office, and seeing his secretary, and being ushered to his office, and looking at him. I wasn't at one with that.

It was the most strange phenomenon. I said, "I don't want to do that." It seemed quite repugnant to me. I think one of the reasons was that I had never been that. I really wasn't in a corporate environment, for Disney was so familial, and I had so much autonomy there. I realized that situation could never come again. The likelihood of being in a corporation that big with those kinds of resources and still being so loose and free, couldn't come. He looked like a little ant to me. It was just a reaction. You know how kids are. "That's where I want to be. Look at that office."

Of course, this is the very building I had coveted in 1967. I had an office smaller than his, but the same environment. It's just that something in me changed. That impulsive and intuitive feeling, coupled with the bankers and investment people in New York, made me feel as if I could really give this a try. That's how I made the decision to begin J2.

We ended up signing on with an investment banking firm called Furman Selz in New York. They took us public. We had an initial public offering. That meant we were able to raise capital from the public, which was unusual because we didn't have any real assets at the time. We had me and a couple of colleagues and some ideas, but we didn't have an actual asset base which is usually identified with public offerings. At the time video was still a go‑go industry and people were buying management and putting their money on people so we had a successful public offering. It consummated in October, 1986 with a new over‑the‑counter stock, J2. (J TWO)

FROKE: Could you describe the types of productions you are involved in now as well as the home video operations?

JIMIRRO: By way of background, one of the things I believe is that J2 is for me, the perfect culmination. Every memo that I've ever written, every meeting that I've ever had, every telephone call that I ever took, all of those years, was preparing me for J2. That's what's so rewarding about it. It's a perfect extension of whatever I have in my background, whatever I have in my experience.

FROKE: I was talking with one of your friends not too long ago who said even in your Syracuse days, there was a certain amount of J2 that was going around. This friend of yours sent you a note, I believe, which he had addressed to J2.

JIMIRRO: Jim Fellows.

FROKE: Yes.

JIMIRRO: This is amazing. He just gave me that last week. It was just amazing to see that paper signed, "J2 Syracuse." That's what's so wonderful about J2, this flow out of everything that had gone before.

Basically what we do at J2 is what I have always done, which is produce and distribute programming. That's not too simplistic. That's what we did at the Disney Channel‑‑the production or acquisition, and distribution of programming. Whether you distribute it through video stores or cable or theaters, it's all essentially the same. This is one of the things I mean when I say there isn't any difference among businesses. If there's any difference between a pay television network and a home video distribution system, and a theatrical or television network or television station, I don't know what it is. The players change, some of the terminology changes, or you go to different conventions and read different newsletters. If you go to the NCTA or the Western Show this week or VSDA, it's the same thing. The video store and the theatrical exhibitor and the cable system and the suppliers are all the same. They're fighting the same battles, have the same suspicions but they're both partners and adversaries.

All of those things are the same. I cavalierly sum it up; there are only five things going on in the world. If you can figure out what they are, you can essentially do everything, career‑wise. I'm talking about business which I think is fairly simple, I'm not talking about rocket science or brain surgery. Business to me seems to be relatively simple from one to the other.

So that's what we do with J2: produce and distribute programs. We do a variety of projects. We have Tim Conway in the most popular comedy video of all time. We do sports programming. We have a new sports project that brings together for the first time in history five heavyweight boxing champions: Muhammad Ali, Ken Norton, Joe Frazier, Larry Holmes, and George Foreman. They reminisce about their great careers and some of the agonies and ecstasies they had through the years. Their conversation is overlaid with archival footage. It's an extraordinary retrospective on what's probably the most interesting period in boxing history.

We have a video called "Teen Steam" with Alyssa Milano who is, by any measure, the number one TV teen star in the country. We have a music video with Elton John. It was done with the Melbourne Symphony Orchestra down under in Australia. We've got some extraordinary children's programming, including "The Mother Goose Video Treasury" which was done by Frank Brandt who did "Welcome to Pooh Corner" and "Dumbo's Circus" at the Disney Channel.

We're doing a brand new children's video series with Debby Boone called "Debby Boone's Hug‑a‑Long Songs." It is based on a book which she wrote called Bedtime Hugs for Little Ones. It sold 100,000 copies plus. I think it's an extraordinary video, again creating the same kind of values I believe in. We'll be doing something for children and parents which maybe will enrich their lives or better their lives and perhaps encourage them to watch television together.

I had a great experience with Debby Boone. I've had it before. It's a very personal one. When I first joined Disney, I'd hear somebody singing "When You Wish Upon a Star." I'd be sitting in a screening room welling up and crying because it was so wonderful to be part of something like that where people care and you're making a difference in people's lives and giving them good entertainment. Yet at Disney that was essentially something I inherited. I was listening to Debby Boone singing some of the songs, "I Think You're Growing Up," or "Hugs," or "I Love You Just as You Are." Every time I play those songs I'm welling up and crying again. I'm a sentimental person in that sense.

My point is that it's so satisfying to be able to create something of your own which is just as moving and important, and you can feel just as much pride in and feel that it's going to make a difference in people's lives for three, four, five and six year old kids. That's an example of the kind of gratification I'm having right now, doing, hopefully, quality programs of which I've just given you several examples.

FROKE: Do you ever think about establishing another cable programming channel?

JIMIRRO: I haven't got an idea for one. But there's one for sale now which I would like to buy. I'm hopeful that it'll happen because I'd love to get back into that business. It's a channel that would be very synergistic with other things we're doing at J2. My goal at J2 is to build a broadbased, diversified, integrated communications company and be involved in as many different facets of the communications business as possible. Cable television would be one of them.

As I said, one is for sale and we're involved in discussions with the investment banker. We're hoping that we'll be able to purchase that one. It may not work. Other people want to purchase it, as well. It's something that will happen over the next two to three months. It's something I think will be very exciting. Some of the people that work at J2 are people that worked with me at the Disney Channel, so we have a bit of a head start in terms of affiliate relations and so forth. It would be nice to be back in there.

FROKE: There are approximately 80 programming channels now or at least programming services to cable television. Some of them are regional, not national networks. If we break it down to national networks there probably are only 40 or 50. Where do you see all of this going? Oversimplification is to say that it's sort of like magazines.

JIMIRRO: The thing I worry about is whether we can maintain the level of diversity that we have now. That may sound like a pessimistic concern, but it is a real one.

FROKE: Eventually the repeats will run out. Is that what you're saying? You'll need more new product.

JIMIRRO: It's more that the pressures to garner big ratings will homogenize program offerings. Right now, in terms of services, I think cable is living up to its promise. I'm amazed when people don't think cable's living up to its promise. It's incredible what I have access to. And we don't even have a particularly good cable system in our community. We only get about 36 channels.

Here in West Los Angeles they're putting in fiber optics and that will improve our service. I don't know how people can say that the industry is not living up to all of its promise. Who could have said ten years ago, Americans could have had news any time they wanted or "culture" any time they wanted? I think that would have been regarded as science fiction. Maybe it's not everything we hoped, but it's a lot better than we used to have. I say that as an observer, not only as a practitioner.

I think though, that if you look at what's happening to some of the broader based pay services or basic services like USA, as an example, or TBS, that you see them looking more and more like mainstream networks.

What one wonders about is the pressure for change. If we hit a wall, will we still get a Discovery Channel. I'm just using that as an example. I'm not privy to their numbers, or a Nostalgia Channel, or an Arts & Entertainment looking at 0.25 ratings. And the advertising pressure starts to build. Will they broaden their programming base and not be true to choice or diversity because of the pressure? Right now everybody's growing so it's O.K to be small because the service is bigger than it was last year. As the glass starts to fill up and now a service is stuck with a .01% market share and management is saying, "where do we go from here" and the advertisers are turning away, is it an inevitable temptation to broaden the base of programming, leading inevitably to less choice than we have today? If you observe the history of American enterprise, there tends to be, in my view, a homogenization process where services tend to want to appeal to as many people as they can. There are exceptions to that of course. There's a cyclical nature to it, as well.

Generally speaking, it seems to me that there is more homogeneity as time goes on. I worry as these channels mature whether or not the great promise of this choice and diversity will remain with us. It's one of the reasons I am a great proponent of the important public sector in broadcasting: PBS. I think, in the final analysis, the way to ensure diversity is to make sure that some people are drawn to the business with a different motivation, a different drive. Not that everybody in public television is noble, but the people there tend to be in it for different reasons. That public component, irrespective of the number of commercial channels we have, is the ultimate way to ensure at least some level of diversity. So it's something I believe in very strongly even though I've never been in public television myself.

FROKE: In the early days of cable programming, the programming side was totally independent of the ownership of the cable television systems themselves. In the mid‑1980s, not too long ago, the cable owners themselves moved into the programming side. The big move obviously was the investment of the group of MSOs in the Turner Enterprise. Do you regard this as positive or negative in terms of the obvious interest that you have in programming?

JIMIRRO: I think, in the most important sense, it's negative. I say the most important sense because in the short term it's been positive. It's been positive because it represented an infusion of money and financial support into services that flourished because of that financial support, services that otherwise might not have been able to flourish. On the short term basis, it might appear to be positive. I think on a long‑term basis...

FROKE: It threatens the type of diversity...

JIMIRRO: It threatens it. That's not an observation just about our industry. It's a function of any kind of concentration of power. The ultimate service of people in my view, politically, economically or financially, irrespective of product, has to do with a diffusion of power. That's something I believe very strongly. America works as a political system because we figured out a way to fragment the power. Generally speaking, there is an absolute correlation between the concentration of power and lesser value for consumers.

Over the long run, there has never been a system in which power is concentrated where people are best served. I can't name an instance where that's happened. Whether it's in cereals or automobiles or anything else. That's why we have antitrust laws in this country. Everybody knows that for free enterprise to work, there must be competition. If you have too much concentration of power, you have a different kind of problem. If you have five different airline carriers competing in one route, you get better service than if you have only one. That's the way it goes.

In the long run, I deplore concentration whether it's vertical or horizontal. In the cable systems it's vertical. (Horizontal would be a group or individual owning all the services.) I think in the long run if one knows anything about how society or economics works, it's a serious problem.

End of Tape 2, Side A

FROKE: (This is Tape 2 Side B of the oral history of James Jimirro.) That then leads into another broad question of principles or values. In recent years the courts have given a certain amount of status to cable television as a First Amendment speaker, meaning that cable systems can be analyzed in the same way one looks at newspapers or magazines, maybe to a lesser extent radio and television where there's a bit of restriction on First Amendment rights as a speaker, so to speak. The local cable operator has the right to select and present programming. Based on what you just said, is there a certain conflict between that position and cable television developing as a First Amendment speaker?

JIMIRRO: You mean a conflict in the sense that we would constrain cable operators, thereby impinging on their First Amendment rights?

FROKE: Yes.

JIMIRRO: I don't think so. There's a great history of America not thinking First Amendment rights are in conflict with maintaining diversity in ownership, which is why, for many years, one couldn't own a television station and newspaper in the same market. That had to do with restraining concentration of power, but you could arguably say it opposed the First Amendment rights. I don't think that is correct. I think the issue of business diversity and fragmentation of power is overriding vis-à-vis First Amendment rights.

Take it to the ultimate extreme. If there is no fragmentation of communications sources, the First Amendment is irrelevant anyway. The First Amendment is only relevant if there's a plurality connected with it. If all the communications are centered in one place, (the ultimate extension of everything we're talking about) the First Amendment becomes irrelevant.

FROKE: The most important part of the newspaper content being the news raised a similar type question with the newspapers when the press associations began to develop, and they solved the problem to a certain extent with Associated Press. AP is really a membership organization, so newspapers are able to say the news content is theirs. On the other hand, you can say the content that flows is not necessarily under direct control of the newspaper publisher or editor except the choice of running it or not running it. So we can dance around the pinhead quite a while.

JIMIRRO: The other thing that's really interesting...and I guess you and I may have talked about this about 20 years ago...is the economic reality of what's happening in terms of concentration of communications. Here is a situation where there are certain restrictions on First Amendment rights of television stations due to the fact that they are public trust. But there are no similar restrictions on newspapers, which do not require limited public airwaves. So newspapers are seen to have unlimited potential in number. The fact of the matter is that newspapers don't have unlimited potential from an economic point of view, if not from a broadcast spectrum point of view. Now you get a situation where there is one newspaper in Philadelphia and 75 broadcast signals. That starts to get very, very anomalous.

I just feel that the essence of what makes everything work in this country, up to and including the First Amendment, is diversity, plurality. I am concerned about...our business as a business. If you take a look at the trend in America, it is consolidation. Earlier, as you can remember, we talked about everything being the same. Look at what's happening with beer. There used to be hundreds and hundreds of local breweries. They got all bought up so giants like Budweiser now have, whatever it is, maybe a 45% share. That may or may not be a problem. I don't drink beer. But it seems to me that's the way it goes. We used to have seven supermarket chains in Los Angeles. We now have three or four supermarket chains. There used to be 11 airline trunk carriers in the United States. There are now seven. It's the nature of business, to consolidate. To buy up the small companies, and to exert greater control.

FROKE: And on the cable side one can say there are 9,000 cable television systems, but they really are relatively concentrated and there are very few MSOs.

JIMIRRO: If we go the same way, from a business point of view, the cable industry or the communications industry begins to act like soap or other industries that are undergoing increased consolidation. Retailing is another example. I was in a store today and talking with people who were wondering what it was like when Bullock's was owned by Mr. Bullock or Bloomingdale's was owned by Mr. Bloomingdale or Macy's was owned by Mr. Macy.

The individual entrepreneurs who diversified the retail business are no longer. Now there are enormous umbrella organizations with central buying and so forth. OK, that's the nature of the free enterprise system. There is also an antitrust component that tries to control some of that. If that same trend occurs in communications, I think you have a very serious problem. The essential nature of our democracy, it seems to me, has to do with freedom being related to informed citizenry. An informed citizenry can only happen if there are lots of different sources from which citizens get their information.

I think we're getting into a very philosophical discussion, but I think it's very important. To go back, I enjoyed college so much, because I loved these ideas. It's just as important as making good programming. If you have a concentration, you run the risk of challenging the very fiber of a free and democratic people. I think it's that transcendent.

FROKE: Going back several hours to the time we started taping Jim, I said we were going to be covering four areas. I think the one remaining one relates to your assessment of the contributions that you have made to the cable television industry.

What would be the one or two things in your mind that you think are most important that you brought to cable television, or are bringing to cable television, for that matter, because J2 is obviously interested in bringing programs to cable television as well as through other distributions?

JIMIRRO: Well, I guess we covered it. You may be looking for something different, but again, it would be the Disney Channel itself. The Disney Channel will always be...as far as I can tell...it will always provide the cable operators with the opportunity to offer to their constituency a complete range of programming. If you take Disney out of the mix, there is an enormous gap. I don't think there is any service that is more important and unique, than Disney. There are some others that are unique, Nickelodeon, or Arts & Entertainment, for example. If you took them away, you'd really miss them, where other services are more similar to each other. Disney is one of the five or six that, if you took it away, it would really be missed because other services aren't doing exactly what they are doing.

I think the Channel has, frankly, made a lot of revenue for the industry. A lot of that money has been incremental because a lot of families subscribe to the Channel who weren't prior pay television subscribers. Even now, those numbers are very compelling. The number of single‑pay homes that are Disney homes is large. We brought a lot of new subscribers into the fold. We lifted basic by substantial numbers. The people, who were turning away from basic, said they didn't care about basic. This was in those "old" days. Basic's better today. It may be less true today.

In '83 a lot of homes only took basic because of pay. If there weren't Disney on cable, they weren't taking it at all. That's the group we were talking about earlier. So, I think we brought money to the fold; I think we brought new pay and cable subscribers to the fold.

I also think we made a difference to people. I think the Disney Channel is making a difference in kid's lives. The Disney Channel is making a difference in how kids think about themselves and how they think about their brothers and sisters and how they think about their parents. I don't want to get too esoteric about that, but that was certainly the goal of the Channel: to enrich and to educate and inform and entertain at the same time. I think that happened and is happening. I think those are the things that did make a difference in terms of what that channel represented.

FROKE: Jim, thank you so much for taking time from your work and also some of your leisure time to reflect on your work with the Disney Channel and your career. It's been enjoyable for me to visit with you.

JIMIRRO: That was a fast three hours.

FROKE: Thank you so much.

JIMIRRO: It was my pleasure.

End of Tape 2, Side B

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Mike Jeffers

Mike Jeffers

Interview Date:Wednesday January 12, 1994
Interview Location: Flourtown, PA USA
Interviewer: Archer Taylor
Program: Penn State Collection
Note: Audio Only. Mike Jeffers passed away at age 90 on May 7, 2012.

TAYLOR: This is the 12th of January at about 9:00 in the morning in Mike Jeffers' lovely home in Flourtown. I sent you a letter on some of the things I wanted to touch on. Having done one of these yourself, you have an idea on what we're after. I like to start on your personal background. Have you always lived in this area; something about your family.

JEFFERS: Yes, it's interesting. Except for military service, I've never been more than 15 minutes away the house. I was born and raised here.

TAYLOR: What about your family, your parents?

JEFFERS: I had an unusually situation. My father died one week before I was born so I didn't have the benefit of a father. My mother was the old strong stock that raised the family of four on her own. She lived to be 85 so; she had a tough life, but as we grew older, she had a very nice life.

TAYLOR: Where did you get your schooling, particularly engineering?

JEFFERS: Well, right before World War II, I started to take chemical engineering at night school at Drexel University, then I served in the military service. When I came back, I decided to switch to more electrical and electronic engineering at the University of Pennsylvania, where I did get my degree.

TAYLOR: Were you doing electronic work in the military?

JEFFERS: In the military, I was a naval aviator. Then I flew off a carrier -- I was carrier based, fighter type aircraft. But they made me the squadron radio/radar officer and I didn't know zilch, but I got interested in it at that time, and that motivated me to switch courses. I also had several graduate courses at the University of Pennsylvania. You know, I have four children. And about that time -- between going to college full time, with some of the children born and eventually trying to get graduate courses... And at the same time, I remained flying in the naval reserve for about 10 years after. And between all that, I finally pooped out and got about 2/3 of the way to a Masters in Engineering.

TAYLOR: What triggered your interest in chemical engineering to begin with.

JEFFERS: I guess I was young and didn't know what I was doing.

TAYLOR: Weren't most of us.

JEFFERS: Yeah, you don't really know when you're right out of high school exactly what you want to do. I knew I wanted to be in engineering, but a particular field of engineering I hadn't decided at that point.

TAYLOR: Like me, I thought I always wanted to be an engineer because we built bridges, built from one side and then to the other side, and put a bolt in it, it was great. Then I discovered that it was a 12" long hole.

JEFFERS: Yeah.

TAYLOR: You have four children. Where are they now?

JEFFERS: Four children...five children...I lost track. I was still thinking of my mother's family. I have five children, three boys and 2 girls. Two of them live in the Washington area. My oldest son graduated as a physicist and then decided that he wanted to get more into business. So he also has a degree in Economics and a Masters in Economics and he has all his classes for his PhD. So he's what they call ABD – still trying to work on his dissertation. The daughter that lives in Washington does have a Doctorate in Economics. The smart daughter #3 never went to college. She always disliked school, but she's come around. She was smart enough to marry a guy that's very successful in his own construction business. Then my two younger sons, one works for Bell Atlantic and he has his degree in Accounting, an MBA in Financial, and he also went and got his CPA. My youngest son works with software. He works for several companies more as a...you know, these job shops that bring in these software people. Then he worked for Intel, the group that bought out a technology from RCA in digital video. He was asked to go out -- when they moved that facility out to Portland, OR, but he decided that it wasn't worth moving his family, etc. He works for a company still doing software, called Tseng Labs right now. So I have 3 that live in this area, rather close to me, and two that live in the Washington, DC area. In addition, I have 14 grandchildren, and that pretty well completes the family.

TAYLOR: Well, you have quite a family.

JEFFERS: Right.

TAYLOR: What were you doing before you got into CATV? Did you go right out of college?

JEFFERS: No, I didn't. I graduated from college from undergraduate school in 1949. A lot of people forget that jobs were very tough to get. I worked for the government for the Naval Air Development Center in Johnsville, PA for about 2 1/2 years.

TAYLOR: Where is Johnsville?

JEFFERS: It's just north of here.

TAYLOR: OK, in this general area.

JEFFERS: Yes, in this area. About 20 miles north of here. It was a commute, it wasn't a move. I guess that about completes that general background.

TAYLOR: How did you get into CATV?

JEFFERS: Well, its interesting. Two very close friends, one well known in the industry is Frank Ragone, and another fellow -- who really got us both into Jerrold -- was a fellow named Bud Greene, and he was the first one to land a job. He had some kind of a contact with Milt Shapp, and became an employee of Jerrold at the time. Then he got Frank Ragone to come with him, and then they got me to come to Jerrold. Then they both left.

TAYLOR: Can you put a date on when Bud Greene went with Milt?

JEFFERS: Yeah, I'd say about 1950.

TAYLOR: 1950.

JEFFERS: Yes. He became -- even though he was a graduate electrical engineer -- he became production manager. Of course, we were very small at the time.

TAYLOR: Yes. Well Frank Ragone was...Greene brought Ragone in?

JEFFERS: Greene brought Ragone in, and then the two brought me in. I stated in 1951. Ragone started -- probably early 1951. Then I came in about 9 months later in September.

TAYLOR: Oh, I see. When did Ken come in? Ken Simons? I think it was earlier than that.

JEFFERS: Ken Simons. Yes, he was, but he wasn't an employee at that time. He was just doing some engineering work. The same way with Don Kirk. Don Kirk was really the first top engineer associated with Jerrold, but Don -- who happened also to be a Navy pilot and a graduate of the Naval Academy, and as a matter of fact got his Master's at the Naval Academy. He'd do work for Shapp down in his basement...

TAYLOR: From Annapolis. I've interviewed Don. And incidentally, you know he has Parkinson's Disease and he was just tickled to death to have an opportunity to relive past history, and...

JEFFERS: He was quite a guy, really a genius as an engineer.

TAYLOR: He must have been, must be. He was very helpful in the interviews. He was probably working with Milt before 1950.

JEFFERS: Yes, he and Milt, as I recall -- of course, you know better than I. He and Milt met at one of these electronics shows I believe.

TAYLOR: I think it was in Baltimore. Don had built a TV set for himself and it wasn't sensitive enough in Annapolis so he built a booster for it. And it was the booster that caught Milt's eye. When you joined Shapp, were they building boosters, or had they gone beyond that?

JEFFERS: They had gone beyond that. They had just about finished...We weren't building them at that time, we were still servicing them. And, of course, I'm quite familiar with the booster from just looking at it afterwards as a curiosity. What they were building at that time is what we all refer to as MATV, the single strip for an apartment house, from an antenna -- mostly for the New York area.

TAYLOR: He had started building those...even before he met Don Kirk you think?

JEFFERS: I would guess at about the same time. I don't know that precisely.

TAYLOR: I interviewed...you know Martin Malarkey started Pottsville, and he used the RCA Antennaplex equipment. And I've been trying to run down the Antennaplex...I interviewed a guy named Mark Solomon, I believe it was, and he said the fellow I should really talk to is Andrew Wall and I haven't got up with him yet. He's up in the Boston area. Wall apparently is the guy who developed the Antennaplex. Larry Lockwood tells me that they used Antennaplex in the NBC house distribution system in New York.

JEFFERS: Yes.

TAYLOR: So, that was in late 1940's. I'm trying to get some dates on that, is what I'm working on. But what's interesting is that Martin learned about it because he had a music store in Pottsville and he was at a show or something, and living at the Waldorf Astoria. He saw television in the rooms there and began asking questions and found out about the Antennplex amplifiers and said, "That's what I want in Pottsville." So that's how it got started there.

JEFFERS: You know I mentioned earlier that as I was brought into the company I was no sooner there than Frank Ragone left, for about 9 months, and then he came back. He worked for an outfit building the same equipment for Philco.

TAYLOR: Oh, really?

JEFFERS: Yes. In this general area, he was up above Willow Grove and his name was Ginslinger. So they attempted the same type of apartment house and eventually they started getting more into CATV.

TAYLOR: That was for Philco.

JEFFERS: Yes.

TAYLOR: Don Kirk left Jerrold at some time (I've got the date somewhere) and went with Philco, and he didn't like the way they were building their microwaves. So he went off on his own, with Dalck Feith.

JEFFERS: By the way, its through that means that Bill Lambert came into the cable television industry, because he was hired by Don to work on the microwave...

TAYLOR: On the K&F?

JEFFERS: Yes.

TAYLOR: I didn't know that.

JEFFERS: So, that's how he came. And then, of course, Jerrold ended up absorbing K&F. Then Don got mad and left again. And at that time, then Lambert stayed with the Jerrold organization.

TAYLOR: Don had quite a story about how Dalck Feith took him for a fare-you-well. It was a pretty sad story he had to tell me.

JEFFERS: Dalck Feith is quite a character.

TAYLOR: I gather. Was he functioning with the company at the time that you joined.

JEFFERS: Well, at that time, as you well remember, everything was in vacuum tubes. Dalck and Milt got together because Dalck's business was sheet metal and he did all the sheet metal. I mean, he didn't even go out for another quote. He was a crafty guy. To take an example, may be we would order 500 sets of parts, he would run 1500 and stick them off, and if we wanted to change something, he couldn't charge it all over again. And we couldn't change it... Because he talked to Milt and he had already done it. He was one smart cookie. If you heard his whole story, he became the major stock holder in Jerrold and eventually when absorbed by General Instrument, was a major stockholder in GI, with the single most number of shares.

TAYLOR: He was working with Jerrold at the time you joined.

JEFFERS: Yes, he was.

TAYLOR: I think he was putting financial resources into the company.

JEFFERS: Yes, he helped Milt a lot.

TAYLOR: Probably enabled Jerrold to move ahead.

JEFFERS: Many is the time he met the Jerrold payroll, and then I don't know when he began to pick up shares, I guess, at that time, but he worked his way up. He was on the Board of Directors for a while. I think. I think he was. He certainly, in effect, had major control over one or two of the people there.

TAYLOR: Probably, just as I put things together, he was a pretty important element in getting Milt going to where he ended up. The company though is still the biggest company in the business. I find it very intriguing that here this company is still going and it's the one that developed the digital television idea, that really began to put it to use with the HDTV...

JEFFERS: Yes, the videocipher division.

TAYLOR: Yes, the videocipher.

JEFFERS: They're a very smart group of people.

TAYLOR: They must be. As I interviewed Ike Blonder and asked him why he didn't get into cable TV more deeply. He said, "Milton had always funded his customers and he didn't have the money to do that." So that's probably one of the things that Feith was able to do for him. Of course, that got him into trouble too with the antitrust things...

JEFFERS: Yes, that's right. That was the service charge business.

TAYLOR: But, looking back that's the kind of trouble you don't mind. You're still getting ahead.

JEFFERS: He got in trouble, but it was kind of a slap on the wrist.

TAYLOR: That' right. Sort of trouble.

JEFFERS: Because way before the court case came up he had stopped that practice for several years.

TAYLOR: They made him divest of his operating companies and then he went back and built another set of operating companies and had to divest them later on.

JEFFERS: Well, he didn't have to divest them.

TAYLOR: Is that right?

JEFFERS: No. Once the final sale of the operating companies...We were under General Instrument at the time...I remember this quite well.

TAYLOR: This is the one that Sammons took over.

JEFFERS: That's right. For 3 or 4 years under the ownership of General Instrument and still operating those, we had to agree to not compete. We continued to operate the systems that we owned but we would not go up against our own customers. That was a very big asset and we held on to it, and it was profitable and all but then General Instrument got in need of cash and they made decisions to divest them, so...

TAYLOR: When was that? Do you recall a date?

JEFFERS: I'd say early seventies.

TAYLOR: That late?

JEFFERS: Yes, that late. See they we weren't acquired by General Instrument till late 1968 and so that was early 1970's. But of course, Milt was out of the company June 1966. I think it was because of his political...

TAYLOR: That's right.

JEFFERS: And at that time he was going first for US Senator from Pennsylvania and he was unsuccessful but it was at that time that he was ruled out...

TAYLOR: Well, he had been very active in the Kennedy Campaign in 1960, I guess that was, and it was somewhere in that time that he sold to Harmon Kardon, wasn't it?...And then Pilot was in...

JEFFERS: Pilot, yes. And then was in Benrus also...

TAYLOR: Oh really.

JEFFERS: I remember going to the Benrus factory in New York where they were stamping out the watch...but they had started...there was another outfit that made oscilloscopes that he acquired. He did a beautiful job of acquiring...that was really right after the U.S. suit against him that they decided to expand and they bought Pilot Radio, Harmon Kardon, Benrus and what was the other...I can't think of...an outfit making oscilloscopes. And then about that time...the biggest problem with Milt at that time was that he was so busy paying attention to everything else that he didn't have any active day to day control. And then, by the way, here is where Dalck came in. Apparently Milt had signed with Sid Harmon an agreement that if they got to a point, and I guess either could exercise it, they could in effect buy the other one out. Harmon brought it to a point. And Bob Beisswenger was there at the time and they started to press the Jerrold end of it and really getting Milt back into the thing and say, "Hey, we can't let this guy run this thing. We go to go after it." The crucial day came up. It was like one of these deals at 4:30 in the afternoon on such or such a day, you either put up or shut up. So through Milt they came to the decision, but it was Dalck Feith's money. As a matter of fact I think that's where he got his money...

TAYLOR: He bought out Harmon Kardon?

JEFFERS: Yes, it was his money that was put into Jerrold that allowed Milt to meet the commitment and the other guy couldn't. I think Loeb Rhodes was involved there and they were the ones that made the decision. It was a very, very close decision. Loeb Rhodes decided that they were safer to support the Jerrold side of the...

TAYLOR: There was another investment firm. I think Beisswenger came from an investment firm, didn't he?

JEFFERS: He came through a support company to the telephone industry. I don't know exactly.

TAYLOR: I can almost say the name of the company he was involved.... It wasn't Loeb Rhodes. It was another company...I can't quite get it off my tongue. What was the year when the buyout took place.

JEFFERS: Well, I can tell you this. Beisswenger was there, so it had to be early 1960's. I'm going by the fact that Milt was out. I know this distinctly because I learned about it at the 1966 Miami CATV show. It was just about then, with a week of whenever that show was that Milt was no longer a power. So you got to bracket it between...I'd say it was 1963 or 1964. To the best of...it was right at that time period.

TAYLOR: Now Milt went out of power...this is what...the sale to GI?

JEFFERS: No, just the Board of Directors at Jerrold.

TAYLOR: I guess I've lost some of this, now the buyout of Harmon Kardon...Milt was still...

JEFFERS: Milt was still active in the company. I had to be around... let's say 1964.

TAYLOR: Then he was in power for a time... then he lost his power by the action of the Board.

JEFFERS: Oh, I'm sorry. He hadn't lost his power at all during this. He was just not doing his job.

TAYLOR: When Harmon was running it.

JEFFERS: Yes, when Harmon was in. So he had no loss of power during that time. They just goosed him to pay more attention to him. He was really letting Beisswenger and others run the company...

TAYLOR: He was having more fun with his politics.

JEFFERS: Yes, he was having more fun...but he still had the full authority. So they kind of goosed him to get back into it for that... So when that came about he was fully Chairman of the Board...

TAYLOR: And when he came back into activity was about the time that they did the buyout?

JEFFERS: They...the buyout of...?

TAYLOR: Harmon Kardon?

JEFFERS: Yes, he came back because of the buyout.

TAYLOR: Oh, because of the buyout. Then taking the power away from him was just by vote.

JEFFERS: It was a just a vote of Board of Directors and that I know precisely as June 1966.

TAYLOR: Why did they take him out of control?

JEFFERS: I think they took him out of control because, again, as soon as that buyout was done, he got back into politics and they just thought he wasn't running the company. It was at a meeting and a vote of the Board of Directors of Jerrold that took him out.

TAYLOR: When did he become governor?

JEFFERS: He became governor, I think in 1970. Because, it's interesting.

TAYLOR: That's about right.

Mike He did two things, in early 1960 – let's say 1962 -- well it had to be 1962 – no it had to be 1960 if he was running for ...He announced back then that he was going to run for Senator. However, that lasted like...here is the announcement and that was the end of it! He was very serious in – I guess it had to be 1965 or 1966 -- that he was going back in for a second shot a Senator. And it was at that time the concern that Jerrold had that it would be impacting the corporation. Because he was a testy kind of a guy. He was a great, great guy, but...the Board of Directors just thought that it would hurt the company and they came to an agreement of selling his stocks and everything else like that. But it was more that he wasn't paying attention to the store and they got him out then. So, then of course, he lost the Senatorial, and then he ran for Governor and won; and won it twice.

TAYLOR: He didn't lose the Governor once? It was the Senator that he lost.

JEFFERS: Yes, the Senate.

TAYLOR: And that was probably 1966 or 1968?

JEFFERS: I think it was 1970. I forget.

TAYLOR: That was for Governor. It was Senate that he lost, may have been 1968.

JEFFERS: Yes, he got fairly far for Senate. I'd say about that time. I'd have to back. When you talk to Len Ecker, he might know that more than I.

TAYLOR: When was Bob Beisswenger killed? Do you remember that date?

JEFFERS: 1974.

TAYLOR: 1974. That was a sad thing.

JEFFERS: Such a shame. Bob had the heart attack in 1968 and he no longer ran Jerrold at that time but he was an officer for...shortly after GI acquired us, I guess it was more 1969. He was Vice President of GI and did special duties for Monty Shapiro and he was kind of hidden away and then about that time, he became Chairman of NCTA.

TAYLOR: That's right.

JEFFERS: So those duties kept him away from Jerrold and really Zemnick almost ran the company. I took care of engineering at that time because it was about the time I was made VP of engineering and there were others in that 1968 though 1970 period. Of course, that's when they bought John Malone in too.

TAYLOR: I'll never forget that John Malone and his introduction to me.

JEFFERS: What?

TAYLOR: I was working with Jack McGeehan who was handling Ed Sullivan's properties and he was going to make a contract to buy equipment for Glenns Falls and asked me to sit in on the conference. So I went down to Jerrold and sat in with Jack McGeehan and some others. And somebody from Jerrold said they've got a new young fellow that they've just bought in and are trying to teach him the ropes and so on. And would I mind that if he sat in on the meeting? Then in came this tall skinny guy in shirt sleeves. This is John Malone, and I thought he was just a green beginner. Within about 6 months, he was President of Jerrold.

JEFFERS: Well he first came in, John's....I can't pin the very day at all, but he came into General Instrument as a consultant for...Who's the big outfit up in....

TAYLOR: Booze Allen, Arthur D. Little?

JEFFERS: No. Begins with a Mac or Mc...Well known up in the New England area. He was working for them at the time. He came in on a contract with GI to look over all of their companies, one of which was Jerrold and that's of course where I met him. But, Monty Shapiro liked him so much that he then got him away from...I can't remember the name...And made him Vice President of GI. So he was really on the NY corporate staff for awhile, maybe 5 or 6 months. The next thing you know he was assigned to help Jerrold out and then eventually became CEO/President of Jerrold. At that time, we were still a wholly owned subsidiary. Because later in the 1970's (I can't remember dates), we gave up that corporate identity as Jerrold Electronics Corp. to become a division. But we were still then a wholly owned subsidiary.

TAYLOR: Is Jerrold the biggest part of GI now? Of their business?

JEFFERS: Oh, yes. Of course, in business. I'd say they are in everything. Although, the videocipher division does very well.

TAYLOR: They've got so many different divisions, but they're all in the cable business.

JEFFERS: Fundamentally, there is Jerrold, the Videocipher and CommScope. Drendel does very well.

TAYLOR: Between those three, is there any other GI...

JEFFERS: No, eventually, they gotten rid of all the others, or merged them in. They sold off everything else. Really, it was Loeb Rhodes that did a lot of that. You know, at the time they took over, any remaining businesses, they got rid of. An interesting thing -- this is very current -- I was very surprised myself. Apparently, Hal Krisburg is over Videocipher and Jerrold.

TAYLOR: Oh, really.

JEFFERS: That's got to be very current.

TAYLOR: Well, Jerrold has also made working agreement with other companies giving them additional capabilities.

Mike Oh yes.

TAYLOR: Going back to engineering, when you started with Jerrold? What was your job?

JEFFERS: When I started with Jerrold, we were so...cable was so new, particularly in the eastern Pennsylvania area. And of course at that time the local stations here in Philadelphia, channels 3, 6 and 10, were really the prime stations. Of course it had all three networks too. But back then, the idea -- because of the attenuation of the cable – was, "Hey, let's get everything in the low band." So I made more channel 3 to 2, 10 to 4 -- and channel 6 we didn't have to convert -- I made more of those damn converters for about the first 9 months to a year. There were other guys there. That's all we were doing.

TAYLOR: Actually producing them?

JEFFERS: Actually producing these converters. We really didn't have time to do much else. Ah, we'd work on...

TAYLOR: This was primarily the MATV business, the apartment...?

JEFFERS: No, no. This was CATV.

TAYLOR: Well, let's go to that question I raised in my letter about Bob Tarlton, who claims Jerrold was one of his first CATV...

JEFFERS: A very nice story about Bob. It was one of those things that I learned the day I walked in the door, yet apparently it's very accurate. This will be kind of romantic. Of course, all of this happened before I joined Jerrold. Bob had a store in Lansford, PA, selling all kinds of appliances, and of course, one of the things he was trying to sell was television. They didn't have much television up there. So that bothers him and he started to look up and.... And what he did was, he ran across Jerrold equipment just in one of the catalogs for feeding MATV systems. He went up the mountains, so to speak. He claims to be the first guy to use coax cable. Others, I think Marty...Walsonavich...? What's his name?

TAYLOR: John.

JEFFERS: Johnny Walson. Has been recognized by NCTA actually, if you remember about 6 or 7 years ago, or something at one of the shows, they featured him. Not many people know his name as Walsonavich.

TAYLOR: That's right. I knew him as Walsonavich.

JEFFERS: He was a character, but apparently he started his with twin lead.

TAYLOR: That's what I heard.

JEFFERS: But Bob went up the mountain and put up antennas and laid the coax down and he bought the Jerrold MATV equipment. And he got into town and, while he had pictures they were so washed out. And then he called in to Jerrold and said, "Could you come up and help." So I think Don Kirk was one of them that went up there and...

TAYLOR: Was Ken involved at that time?

JEFFERS: I don't think Ken was involved.

TAYLOR: I don't think he was either.

JEFFERS: But anyway, they went up, the engineering staff. I wasn't there at the time. They looked at his pictures, and a big light bulb in the sky went off. All the MATV gear was, was a synchronously aligned amplifier, right around the carrier. And if you take only one shot down, that's pretty good. Of course, it was black and white at the time so you didn't need a helluva lot of bandwidth. ...but the cascade.....running back and modified their amplifiers to be flat across 6 MHz... and went up...and Eureka... very good improvement of the picture. But at the same idea they saw this tremendous market there and also at the time there weren't such things as converters and he was losing somewhat so... Ken did the converters. Ken Simons designed the converters. And that's what I say, I was in the midst of all this burgeoning out, and the key was...you know we could build the amplifiers, we just learned to aligned them wide band and you need these converters to change a 3, 6 and 10 to 2, 4, 6.

TAYLOR: Or 2, 4, 5.

JEFFERS: Either one, we built them all. Bill Felcher, another guy who was there at the time...

TAYLOR: Bill F-E-L-C-H-E-R?

JEFFERS: Yes.

TAYLOR: I don't know him.

JEFFERS: Well, he had a long history with Jerrold but he never rose to be that good a technical man. He did his job well, and all that kind of stuff, but he wasn't a shining star. But he and I sat there and we built those converters till we were going out of our minds.

TAYLOR: Interesting. I had heard that Ed Parsons had used twin lead initially and I hadn't realized that. I thought it was coax from the beginning and I talked to Dick Old. He confirmed. He said it was twin lead all right that they started with.

JEFFERS: Who was the outfit in the state of Washington?

TAYLOR: Well, this is in Astoria, Oregon. They for a long time were accredited for being the first. And there's still an argument I guess as to whether John Walsonavich was in there ahead of him. Because Strat Smith tells this story in Mahoney City, John had painted on his vehicles "established 1950." And when he heard about Parsons claiming 1949, he painted out all that stuff and said, "established 1948." So there is a little bit of...and knowing John, you wonder a little bit.

JEFFERS: It's funny. The thing I liked about John was, that he would come to an NCTA show and he looked around. If he saw something new that he could use, man, there is a purchase order right in your hand. He was always the first one to buy something. One particular thing was when the first channel commanders came out, boy, he looked at it with no hesitancy.

TAYLOR: He usually modified things.

JEFFERS: He didn't modify them too much, not the basic CATV.

TAYLOR: That's probably true. I remember the Starline One. He bought the chassis and put then in sheet metal housing, and not the cast housing.

JEFFERS: Right.

TAYLOR: Do you have any idea; it was before your time, but how long had Milt been building MATV strips? Was he doing it when he met Don Kirk, I wonder?

JEFFERS: I don't know.

TAYLOR: Kirk's introduction was the booster, I know that from what Don told me. I feel pretty sure though, I will find out when I interview Andrew Wall. I think that the Antennaplex was in use at least for the NBC house operation and for some of the New York hotels earlier on.

JEFFERS: It could be. I don't think Jerrold ever claimed to be first in MATV and secondly, I remember – coming out of the fog there -- there was a patent by a guy on basic MATV systems. We always had to look cross-eyed ....

TAYLOR: I see, it was not Jerrold patent. RCA?

JEFFERS: I don't know.

TAYLOR: That's another interesting thing. I have a friend who asked me one time, "Do you know Louis Crook? He invented coaxial cable TV you know." I said, I had never heard about that. So I began investigating and I found a patent that was issued in 1941, I think, or something like that. And it described coaxial cable, although not quite in those terms. But it had an outer conductor and a wire down the middle, it was insulated, and he described it as distributing television to homes or other business. Very crude thing, but then it turns out...I was taking this up with Strat Smith...

End of Tape 1 - Side A

Start Tape 2, Side B

TAYLOR: I will talk again about the FCC document that Strat Smith found dated, I think, 1937, in which the FCC -- because, at that time there wasn't any commercial television. Sarnoff and some others had some experimental licenses but nothing commercial. The FCC was writing about, "How are we going to distribute television once we get it going. There are two ways to do it you can do it by radio or you can do it by this new Bell patent on coaxial cable. 1937. So its interesting the idea was alive even before television itself.

Mike Yes.

TAYLOR: The MATV business probably got started in New York.

JEFFERS: I believe so.

TAYLOR: When you came in, Ken had been working as kind of a contractor, but not an employee.

JEFFERS: Not an employee.

TAYLOR: Yes, he told me about that. The money he got was pitiful but, he did all right, and Milt took care of him at least for awhile. When they changed from MATV to CATV, did they do anymore than just put the "W" on the front end of the designation?

JEFFERS: Well, yes, they redesigned the strips slightly and of course as I told you before, they had to broaden the response and all, so that was the change. Those amplifiers, and I worked on them. They were beautiful for a single channel strip. We'd go up and cover the 6 MHz and of course when we had the non-adjacent channel, you had a space between 2 and 4 and even between 4 and 5 because of that 4 MHz and certainly between 4 and 6. You could broaden it and they were actually beautiful. Typically they would be flat with about 2/10 dB even then.

TAYLOR: How did they get to going into adjacent channels, broadband operations?

JEFFERS: That was a little company called Entron.

TAYLOR: Yes, I interviewed Hank Diambra.

JEFFERS: Good old Hank. Entron came out with this broadband from channel 2 to channel 6 and, we opened our eyes and decided, we better design one.

TAYLOR: That was actually distributed transmission line...

JEFFERS: No, not at that time.

TAYLOR: Just broad stagger tuned?

JEFFERS: Just broad stagger tuned across the band. And its very interesting. On that project we learned...its funny some of the things you learn, and there was a particular learning experience. We had a thing called a Univamp and we designed that...and it didn't take us long to learn that too much gain can be your enemy. Because that damn thing must have had about 40 dB of gain. Well it was a nice amplifier and you know, you cascade many of them... What was Ken Simons expression at one time? I'll never forget. He was not involved in it. He says, "Your cross-mod-ed signals had noise in them."

TAYLOR: Outside of that, no problems!

JEFFERS: That's right. So that was the first shot. But we quickly learned that you can't stay in that kind of game. Then we switched to a thing we called the UBC, which was a unit that had about 24-26 dB of gain. The number of those we sold were unbelievable because it was the right gain. We started to pay a little better attention to the noise figure, and of course output capability. We, at that time learned, and this is true... Incidentally, if any thing, I think the amplifiers today have too much gain, between you and me. But, what we learned is, when you have that -- and it was a 3 stage amplifier. And the best kind of amplifier is one that is around that kind of gain, where the input stage is devoted to noise figure with some signal handling capability, and the middle stage is the one that kind of fits the two, and the output stage is aimed at high output capability. Really that's the essence of what should be in a cascaded amplifier. Not to get off the track, but you can pretty well prove that technically. Because, if you do a theoretical study and you want what you consider to be the best amplifier you can get, it would run around 16-17 dB. Because the input stage dedicated to noise figure, and the output stage to output capability -- each in themselves not being a contributor to...distortion in the output of the preamp, or noise only in the input of the post amp. You can sit there and prove that, if you pick the best device for noise figure and the best device for output capability, that you ought to be somewhere between 17 and 20 dB. Then you come in with the practical fact that you need AGC, and therefore you have some movement, which you want in the interstage. That's what really takes it up to around 24 or 26 dB gain. Getting above that, you're kidding yourself.

TAYLOR: I had an interesting experience. John Walson got me up to Allentown, one time, for the bank, and I went out. We did some checking. We had one line that was 56 amplifiers deep, then went out there and looked at pictures (I didn't have any means to make a quantitative measurement) but we looked at pictures, and my gosh, they were good. 56 amplifiers deep and all this home made stuff that John and Jack Warner were putting out...I couldn't believe it. I asked if I could take one of his amplifiers and do some testing on it, which I did, and discovered that the gain was about 11 dB. No wonder they could cascade them, because they got good results out of it.

JEFFERS: Well, of course, we all know that the theoretical best for longest cascade was supposed to be 8.7, but the point is that in cable that's about one device, and you can't get one device that meets the specs for noise figure and output.

TAYLOR: That's right, noise figure and output.

JEFFERS: That's what's got you beat. What stretches it up a little better, the fact that you can favor it. And you can show definitely that they're longer cascades.

TAYLOR: The other thing that John did is that his feeders were all passive, he didn't have any amplifiers in his feeders.

JEFFERS: Who was the oriental fellow up there?

TAYLOR: Bark Lee Yee

JEFFERS: Bark Lee Yee. Boy, there is a guy that had a homemade system.

TAYLOR: That's right. I never did get a chance to look at it, but I know that's right.

JEFFERS: He did the damnest things with it, but he really customized it and of course I'm sure he's been tremendously, financially successful.

TAYLOR: Oh, yes.

JEFFERS: But getting back. There's no question Entron coming in with their broadband amplifier and now they have 5 channels. That was a major step, no question. Many times Jerrold has led the industry and many times we followed on. But generally we followed it better than the guy that led it.

TAYLOR: That I remember.

JEFFERS: That was one case. There's no question we...To get five channels in a simple amplifier like that, and then it probably was the simplest amplifier we ever made, the UBC, the Uniband.

TAYLOR: Do you have a date on that?

JEFFERS: 1956. Frank Ragone designed that. He designed both of them.. Another interesting thing we learned. It's funny, right in that period we probably learned more about the technology of cable systems than the other times. I think it was the Uniband, which had AGC -- an oscillating AGC system! You'd like to have quick response on this, which is stupid. Actually that's fine for a headend amplifier or anything like one of the commanders or processor or something like that. But my God, the only thing that changes in cable systems must be such minor dB's due to temperature and all. But, boy, you get out there and you lose a signal temporarily in one place, the AGC would respond, the next one would....

TAYLOR: Fighting each other all along the line!

JEFFERS: So we learned that. We learned all about lower gain units, AGC and eventually we put good technology in to that. I'd say the late '50 and early '60 we learned quite a bit more.

TAYLOR: I've been interested in the distributed amplifier type design as you know from talking to Jake. SKL was building before CATV got started anyway. In fact, they may have been building during the War, at least shortly after the war, I'm not quite sure. I've it from your interview. That was a patent and as I understand it, there was a British by the name of Percival I think, who had a patent on distributed amplifiers and Fitz Kennedy was operating under that patent. He realized that that was a patent. But when Amplivision, they guys out in Los Angeles, started building Amplivision devices, Fitz got real excited. He didn't like the idea that they weren't honoring the patent and Fitz was. Fitz told me a couple of times that he was just furious over Amplivision. But then I was talking to Jim Palmer and this goes to about 1951. He said he never built anything but distributed amplifiers, and he didn't even know about the patent. So, Jerrold never did go in to distributed amplifiers.

JEFFERS: Oh, sure we did. As a matter of fact....

TAYLOR: Oh, well the transistor...No, no.

JEFFERS: No, I was the guy at Jerrold who did all the distributed amplifiers. The first distributed amplifier we did, we did a sub-low. As a matter of fact, in the first distributed amplifier we did, which was 1957, we were in push-pull. We introduced push-pull there. In effect, even though it was a distributed amplifier with vacuum tubes, we had, in effect, an input stage...by the way they are a very good noise figure, excellent noise figure. OK. And we had...call it a two stage amplifer. But it was this way, a non push-pull.... The first stage was called the preamp stage. Then we went into push-pull from the output stage so we could cover that whole band without second order of distortion. Then we elaborated on that. As a matter of fact, the biggest customer of ours on that amplifier was the Bell Systems. And Southern Bell in South Carolina had them all over the place.

TAYLOR: What amplifier was that?

JEFFERS: The LSA-795. Then we built another one for the Bell System. We actually used their tubes. We used the 403B tube, which was a...There were several tubes that came in. On our own, we used a 6CB6 which had a higher gain and all, but the reliability of the 403B made by Western Electric was so good that they asked us to build it. There it was just a substitute. But, god, we had a lot of them...more in the Bell Education System in SC, all over the place. There was an interesting thing. The first leg installed -- and it was interesting working with Bell. I had worked with Bell an awful lot, more than anybody else at Jerrold at that time. But we had another amplifier that was fully push-pull, all distributed. And so, for the same reason, they were using the low-sub system, they were using with the Bell coaxial cable and all that. Southern Bell had a contract with the State – the educational part -- of SC to deliver signals to the schools. We built (because I was so intimately involved, I remember every detail); Orangeburg, SC, where there was a headend, We went 45 amplifiers in cascade and we had Bell Labs people down there, Southern Bell people there. I remember working under a pole where there were 14 Bell people and me. We did the cascade and they did mop up equalizers as we went along, designed right under the pole, and it was very successful. An interesting thing that I like to say, here are these guys, like everybody else, saying, "We're building this, but losing our shirt." Of course it was very rural. They're losing their shirts. They trenched in the cable, they put... Here's the coax, but the number of Bell pairs.... Yes, they lost it, if they just considered that. But they updated their system as they went along. They were big. And I designed another one, which was really our top amplifier from about 1960 till we got into transistors with a product called the SCA213. It went from 2 to 13, it was not push-pull, but a fully distributed amplifier. We did very well with it. It had excellent specs because distributed amplifiers by nature have low noise figure and a very good output handling capability. So we were very heavily into distributed amplifiers. The best thing that happened, and I remember this well because it was kind of a triumph. We had just flat AGC on these low-sub LSA410 -- 4 to 100, I guess is where the number came from. This is the one that was really trenched in and built in large measure down in SC. We were going along this long cascade, we're at the end of it 44 amplifiers long, and the guys from Bell Labs say, "While we're out here and we have the alignment, why don't you go along." And these guys said, "We're going back. We just want to measure how good the second order distortion canceling is." And they joined us for lunch and this guy at the Lab says, "Mike, we got a problem." He says, "After the 10th amplifier we measured and that second order distortion is not that good." I'm sitting there. And I start to think, "God, I've gotten better results than that, what the hell happened?" Suddenly it hit me. At the 10th amplifier location they dropped in an SKL amplifier that gave gain and tilt. And that's single ended. I said, "You know what, why don't you guys go back and measure at the output of the 10th amplifier and then at the output of the SKL tube control." Well, they came back and they were absolutely sick because they had never thought of the effects on second order of that amplifier, and this particular guy was scared to death of the boss at Bell Labs. He thought they were going to catch hell. He says, you are absolutely right. We can hardly measure second order. So, I felt like a million.

TAYLOR: I bet you did.

JEFFERS: It was all through those amplifiers that we got into push-pull and of course we've been push pull ever since. Our first transistor amplifiers were at least the push pull output stage. The first line extender, and if you remember the first IC's were from TRW, and they had an interesting way of trying to build their devices to hold down distortion. It was something that I had dealt with before that and I knew that method. That method really wasn't reliable because it only cancelled distortion at one particular level. If we had enough work with push-pull to know how successful it was. We would not buy their devices for our line extenders and we were in transistorized line extenders almost before anybody else. We weren't in to trunk amplifiers at that time but we were buying IC's from TRW like you wouldn't believe, to fill the line extender orders. And we insisted they go back and do it in push-pull. And I'll tell you the truth, it was a big help for us but I'm sure it made TRW in the beginning because they were going through single ended device compensated in some way, feed-back distortion and all.

TAYLOR: Now, how back the Hewlett-Packard IC that Anaconda used in their first transistor amplifier. Ken tells an interesting story about that one.

JEFFERS: Well, the Hewlett Packard IC was pretty good that Anaconda used. We built an amplifier. I know this inside and out but I can't think of the product name. Well really, its Starline 300 is what it started out. That was our big amplifier and we still sell them to this day. We contracted with Hewlett Packard, and fortunately we also contracted with TRW to build amplifiers that were actually better than the ones they used with Anaconda.

TAYLOR: You were building them with lumped components?

JEFFERS: No, not at that time. We were talking in the vicinity for us... Anaconda was ahead of us. I think they were like 70 or 71. We're talking in the period of... Well the design effort to work with them was 1972 and we introduced the amplifier in 1973 at the NCTA show. So it was a different amplifier than the one that Anaconda used. Of course ours was full push-pull.

TAYLOR: Your amplifier, you said, was better than the HP IC?

JEFFERS: I'm sorry. I talking amplifier as the full stage, using the Hewlett Packard or TRW IC.

TAYLOR: Oh, I see, better than the Anaconda.

JEFFERS: I'm talking about the integrated circuits by Hewlett Packard and TRW. It ended up... We had a contract with Hewlett Packard. I was out there many a time. They built a beautiful unit, they had a new transistor that they developed. It was a wagon wheel transistor. Its performance was excellent. A good way of saying it... I'll try to get to the bottom line. They had a marvelous reliable device, but very poor ruggedness. In other words as long as you didn't jolt the voltages up and down or do anything to it, it would last for ever. As soon as you went "pffft" with a surge and all, they were gone. We went on a long development with them, went on a development with TRW as a backup, a second source, and Hewlett-Packard got to the point where it cost them a fortune and they had to back out of the contract. They honored the first purchase orders, but they raised their price so much, we couldn't begin to stay with it. So they completely misjudged their costs and all and to honorably back out. But we did build some and I'll bet you they're still working. Canada was a big user of amplifiers with Hewlett-Packard devices. We worked on our circuitry, particularly the circuitry around the B+ voltage coming in so that we dampened any possibility....

TAYLOR: ...to get rid of any spikes, yes.

JEFFERS: It was all protected, so as long as we had them protected... TRW didn't need anything like that. But as long as we had that circuitry with proper time constants so a surge wouldn't come through, Hewlett Packard were excellent devices. But they got to be so pricey, that they backed out of it. Its interesting I'll tell you; this is my philosophy -- I'm sure I'm right -- discussing Hewlett Packard's technique and TRW's. Hewlett Packard would design theirs on a sapphire substrate. All their resistive elements they would hold within -- just at the development stage on the sapphire substrate -- they would hold accurately within, I'd say, 1/2 a percent. That cost them an arm a leg. TRW would build theirs deliberately -- all their resistive elements and that kind of stuff -- they built them at maybe 10 or 12 percent high and come in and do a laser trim. They got their laser trimmer working so fast. You would go blind looking. They would trim about 25 elements within 20 seconds.

TAYLOR: I'll be darned.

JEFFERS: And there is the difference in manufacturing techniques where TRW was – hell -- so much more cost effective in their work compared to Hewlett Packard, that Hewlett Packard couldn't stand it. Plus that fact that sapphire substrate isn't cheap.

TAYLOR: That's right.

JEFFERS: That was a great amplifier. It's a shame it didn't work out with them. Our amplifier was very expensive. I'll tell you another system that has those, Suburban in New Jersey. They had reliability like you wouldn't believe.

TAYLOR: That's with the Hewlett Packard unit?

JEFFERS: No, with either TRW or Hewlett Packard. Most of the Hewlett Packards were used in Canada because one of the things we had to do, we had to go in and do test on all the spares. HP had a supplier for spares and most of the ones we had we shipped to our Canadian facility, Jerrold Canada, just to sit their but it was strictly they couldn't compete.

TAYLOR: The TML series, was it your first transistor amplifier?

JEFFERS: Yes, they were the transistor amplifier.

TAYLOR: It was just a transistor, not an IC unit?

JEFFERS: Yes that's right. Even our first, we used to call it Starline 20 at the beginning, the TML line just was transistors, in sheet metal, just big...copper...the copper, as you know, is an overall heat sink. They didn't last too long and they were designed to just drop into those big sheet metal housings they had out on the poles. By the time we got to Starline 1 and then on to Starline 20, the difference... Starline 1 was not push-pull. It was really a fancy housing etc. designed just on a circuit board with the transistors in there and some heat sinking capability.

TAYLOR: That was the one that had the RCA stud that caused so much trouble?

JEFFERS: No. Let me think. Yes, I'm sorry. It wasn't a stud, a regular transistor, 2N3866, was just enough... typical TO housing. And then you'd get these things that clamped over it that had fins out for cooling and all. But we had a helluva time with them.

TAYLOR: There was a lawsuit against RCA on this. Was that settled?

JEFFERS: Yes, it was. We got about a million dollars. But it certainly wasn't worth all the pain. By the way, every cloud has a silver lining. That's when we learned about transistors. A guy who did an awful lot a work for us was Eric Winston. I think he has about 20 patents with Jerrold on all kinds of things, mostly on coaxial fittings. A lot of people don't realize that all the coaxial fittings today are off-shoots of his design which came about when we went to the Starline 1, the way we coupled it, and that's become a standard in the industry. He did a lot of work on the special studies on coaxial cable. He was just a superb mechanical engineer.

TAYLOR: The real old one, C-fitting, was that his?

JEFFERS: No. F-fitting was his. All the F-fittings.

TAYLOR: Where did the C-fittings come from? I asked Ken and he couldn't answer.

JEFFERS: C-fitting were coaxial fittings used for a small coaxial line.

TAYLOR: This was in existence and you could buy them?

JEFFERS: But C-fitting and D-fitting were there.

TAYLOR: I've never heard of the D.

JEFFERS: Yeah, the D is really a special version of the C-fitting. E I've never heard of.

TAYLOR: They used E in Europe.

JEFFERS: Do they? But the F-fittings, most of those were different versions of what were really his designs -- Jerrold designs. Then all the BSF line and its splices and everything... We have patents coming out the gazoo on those, but they've all run out.

TAYLOR: Somewhere in the design for a period of a couple of years maybe, Jerrold was pushing the idea a quad transistor rather than an IC. I've heard some stories about that. What was the story?

JEFFERS: Well, the quad was a good idea. First of all, it was inexpensive and the outfit that build it for us, Power Hybrids...

TAYLOR: Jerrold acquired the company?

JEFFERS: No, we didn't. I was saying all the things we learned in the RCA case and... Let me get back to that, because it's important in terms of the quad. We were able to look in on the transistors and see defects... and you know, the bonding of the leads from the transistor to the post was bad. You get in there with the electron microscopes and all that and you could see that that RCA was poorly designed and poorly built. But it was then that we got into those studies and the outfit called Barnes -- and we bought it -- had infrared scopes. You could go in on a transistor and measure the temperature patterns across, and you could measure the bonding of the transistor to that, and all those things. By the way, another outfit that had already gotten into that was TRW. You'd get from TRW the different blow ups of the metalization tab and they really did a good job. And that's when we got into the stud transistors, which is what we used in the first Starline 20 amplifier -- the one that went out to about 220 MHz. And we literally in that one -- this is all the follow-on of TML which is in the metal housing. Then, Starline 1, in which we're floating typical transistors with heat sink attachment to the case to keep the heat down... Then we went directly to the first stud type which was called Starline 20, and that was really tied up with the second housing. The first housing where we went to the coaxes right in, and the thing was pole mounted Starline One. We almost immediately went into a Starline 20. Now we're using the stud transistors and almost immediately within the same housing and all, went to Starline 20 push-pull, where it was still devices, but they were all stud transistors from TRW. And all the studs were heat sunk to the housing. The housing became almost an infinite heat sink. So it was all during that period that we were really learning about transistors. Now to get back to your question, where did the quad come from? The quad came from the fact that all our amplifiers at that time were powered with a minus 27 volts DC, and there weren't any ICs out at that time with a minus 20; they were all +12, full +24, which of course was the industry's standard then, +24. All the ICs that have been built since then have been +24 -- plus the fact that we had to move fast, because this is now going into the ICs. And we got hold of PHI [Power Hybrids Inc.] and PHI was building a beautiful transistor. And PHI started to be a supplier of the stud transistors as well as TRW. Well we got together with them and talked it over and they said, "Hey, can you build...both mechanically we were up against it, and also electrically we were up against it because we used a negative supply. It was easier to go and do a quad where we could determine how the supply went, and also could fit it in our mechanical package, and upgrade to be somewhat equivalent to our competitors who were now all in the... TRW and others, that made the 24 volt DC integrated circuits. The only difference is that the quad was all the circuitry except the push-pull transformers in an amp -- there were four devices. The thing that was very good about them was ,they were probably more reliable because they would build this -- I'll call it a quasi-integrated circuit -- they would build this on a beryllium-oxide substrate. Literally, the substrate they built them on was beryllium-oxide, which is the best heat sink material for the transistor. They had a completely gold circuit pad in there. They had all the resistors, very much like any IC manufacturer would make. And out came two input leads, and two output leads, and you just build on our circuit board the little RF transformers that would couple into it. Then as you measure the temperature right on the transistors, we were running 20 or 30 degrees lower for the same power as any of the other guys were. It was cheaper. Everything was fine. No problem for Jerrold. The problem was if the device ever went on in the field, they were a beast to change, compared to the little ICs. Of all the things that hurt us... and the reliability was excellent, but the big thing was the technicians in the field -- if there was a problem -- they had trouble getting in there and replacing it, and still maintaining balance and all. But it was a very good escape from the Starline 20 push-pull type design. To get up and have performance equal to or better -- and our performance was actually better with them -- but they were clumsy to handle. Then that's when we switched to... First of all, at that time, the big amplifier, the Starline 300, came out using the Hewlett-Packard and TRW IC as we discussed earlier. One interesting thing that I think is good for the history is... At the time we did the Starline 300, that was an expensive amplifier. The people that bought it and used it felt it was money well invested. But there were a lot of guys that couldn't pay the price. But that Starline 300 -- and its...they called it JN and all that continued past that as we went higher and higher in bandwidth -- that was really designed much more to fit the requirement of TelePrompTer.

TAYLOR: Oh, really?

JEFFERS: Yes. A little lapse on a good friend.

TAYLOR: Hub Schlafly?

JEFFERS: Hub.

TAYLOR: Yes.

JEFFERS: It was practically designed to Hub's specifications because we thought he had great ideas. I mean that could carry two cables. It could carry an institutional cable. It was a bunch of building blocks that could do damn near anything. The problem was, most systems didn't want the full capability. It was right at the time the FCC stuck their nose into it, and people were worried about whether cable would ever be successful. It was in 1973-1974. It was a magnificent design but too expensive for the people. But we sold quite a few of them and almost everybody that used them liked them very much. It was also one that everything was push-pull -- click-click. As new models, new expansion and frequency, came in, you could just plug them in there.

TAYLOR: Was the balancing in the push-pull taken care of in production? Was that ever a problem in the field?

JEFFERS: No, not really. You'd have to look at it, but we pretest all the IC's. There was some balance in effect, but push-pull as you well know, as along as you get the second order distortion out of the way so that they are not limiting the degree of that. I'll tell you can't really, in a practical sense, achieve more than about 20 dB of balance cancellation. Another thing... and I refer to Jake Shekel on this, and its very, very true. He was a very clever man, and had a great sense of humor. He used to say that the best way to get rid of second order distortion is have more channels. Because the third order is going up much faster, as you add channels, than the second order, the spread is more. And therefore, just by the nature of the additional number of channels, and a quicker build up of composite triple beat and all, it eliminates or reduces the distortion of second order.

TAYLOR: Yes. Very interesting concept.

JEFFERS: Yes, a very interesting way of looking at it.

TAYLOR: Going back in time a bit, there's a couple of questions I wanted to explore. Larry DeGeorge and Milt Shapp had some kind of working agreement I think in the early days. I think it was just a working agreement, I don't know if there was any formal contractual situation, but...

JEFFERS: Minor.

TAYLOR: That's the best way to say it.

JEFFERS: At that time we became the national sales representative of Times Cable.

End of Tape 1, Side B

Start Tape 2, Side A

TAYLOR: We were talking about Times Wire and the relationship between Milt and Larry DeGeorge, the two companies. Larry told me that he'd agreed to stay out of the electronics business and Milt agreed to stay out of the cable business which both of them did, until Larry kind of broke that when he went into the mini-hub business. He started doing electronics and I guess found out that it was more to it than he thought. At any rate, he didn't succeed with it. Then Jerrold went into CommScope.

JEFFERS: Well I think our association was over by the time the CommScope deal was...

TAYLOR: I'm sure it was. Milt was long since out of business at that time.

JEFFERS: CommScope was, I'm sure you know... I'm kind of talking to my self to refresh my memory. CommScope came as part of the deal when we acquired Videocipher. They were with Videocipher.

TAYLOR: Yes, I never thought of that but was so. And I guess it was Frank Drendel that put all that together. I'm trying to get Frank for an interview and he keeps promising but I don't get it.

JEFFERS: Oh, he's an interesting fellow.

TAYLOR: What's interesting - Strat interviewed Robert Brooks and it was Bob Brooks that bought Frank into the business. I didn't realize that. I remember Frank was the head of a little cable outfit called Superior Electric, I think, and all of a sudden one day, he had a whole big outfit, Macom and the whole business, it was incredible that he put all that together.

JEFFERS: Jerrold was very interested in CommScope at the time that they got into fiber optics with that company they merged with. I cant' think of it...

TAYLOR: I'm trying; I think it began with a V.

JEFFERS: I think it was Valtec.

TAYLOR: Valtec, that's the one.

JEFFERS: I went up and met with Frank and I kept following Frank's career.

TAYLOR: Oh, really?

JEFFERS: He's one of the smartest guys in terms of maneuvering business...

TAYLOR: Got to be.

JEFFERS: I'd be talking to him, and he'd be telling me something, and I could almost see him, "Hey, boy, you're on the move!"... Such a clever guy...tremendous respect for him. But as I say at that time I think our association with Times -- as being specifically a sales agency for Times Cable as we sold our equipment -- I think that had broken up way before we were doing anything, you know, any type of merger with....

TAYLOR: Well, I suspect it goes back to when Milt himself kind of got out of the business. I think after that just by habit, people would go to Times. I don't think there was any...

JEFFERS: We were dealing with CommScope at the engineering department, well before we were on the verge of a merge with Videocipher.

TAYLOR: The first time I ever met Don Spencer was at the factory there in Cambridge. He kept talking about Superior Wire, "We're using Superior Wire." I thought he was saying, "We're using the best there is. I discovered that was the name of a company, and they were using the Bell 375 or Western Electric 375. And he was telling me how cleanly it would sweep, and all the beautiful parts about it. They were just great. They were in Hickory at the time, and eventually became CommScope, who was still in Hickory. PAUSE. Oh, I know, I was going to talk about the channel commander that...Was Frank Ragone primarily responsible for that.

JEFFERS: Yes, that's another interesting story as far as I'm concerned. In another learning step for Jerrold because the channel commander, first Channel Commander I, which was tremendously successful, used a commercial tuner so you just bough a tuner...

TAYLOR: That's right.

JEFFERS: Built our own IF strip and our own converter and packaged them in the rack panel equipment. But they were just different modules all with vacuum tubes. AGC controls fed back to the tuner, just as in a television set. I'll tell you it was good product

TAYLOR: It was.

JEFFERS: Of course, that came out just about 1960. We had, before that -- a lot of people forget -- a modulator-demodulator system. Teletrol it was called.

TAYLOR: I remember that.

JEFFERS: ...of course, thank God for black and white. If you ever came down through a demod and then remodulated -- you know, an equivalency to the processor -- that picture was terrible. But fortunately we got into the commander and it was very, very good and held up pretty well, even through the color fringe. But then...

TAYLOR: When was it introduced?

JEFFERS: I almost swear it was 1960. I know it was at a cable show at the Shoreham Hotel in Washington.

TAYLOR: ...in Washington.

JEFFERS: Again, a very successful product. But as you know the age of transistors, as you well know, started around 1963/64/65, and we'd pretty well gotten out of vacuum tubes, totally. So we had the Commander II product. And lo and behold, we got into a problem with signal and noise ratio. It was one that drove us crazy. Fortunately, when we woke up to what we were doing, we realized we had a very simple correction that we could implement in the field, and then redesign around it. We had always looked at noise figure, but never paid much to signal-to-noise. And really, what you're talking about is signal-to-noise. Noise figure is a big help as a device for handling. But, the reason we didn't run into it with the Commander I, was simply that we were using the television tuner and the IF fed back to the AGC control and it had delayed AGC. What happened in the Commander II was, we started to lower the gain too soon. By the way, this is an interesting thing in television sets today. Some of the manufacturers, where they use the signal-to-noise ratio... In other words, if you're in a real weak area, a long distance thing, you have no AGC control and your signal-to-noise ratio is getting better and better as the signal increases. But then there is a certain point where you are going into overload and you've got to trigger your AGC -- particularly a delayed AGC -- to start now lowering the gain eventually hitting the video detector, and we didn't do it right. And it took a lot of thought behind it. It was new to us. As a matter of fact, I had never had anything else at that time to...any experience whatever with headend equipment. And I guess that got me to get in and understand what the hell was going on. And after I did the analysis, we quickly learned that what we were doing was applying the AGC entirely too soon. And therefore, the signal-to-noise ratio wouldn't improve past a certain point. But then we learned. And since then, we've had pretty good luck with Commanders. Of course, our friends at Scientific Atlanta built very good equipment too. And there's no question, because of Jerrold's lack of concentration on the headend compared to the distribution, we really lost market share. There are two things -- one thing I'm sure Ken told you about this, but I'll just add too it. Under Ken Simons' direction, another product line, our test equipment, was really outstanding for that time. But you just don't build test equipment on the same damn line as you build broadband equipment. And it was that lack of concentrating on the test equipment line that cost us a good business after excellent work down by Ken Simons and Eric Winston and some other guys. We could have been big in test equipment if we knew how to produce it. A similar thing, not as bad, happened with the Commander product line, that we lowered the priority on having what I call top level headend gear and producing it with quality and all that kind of thing. We had a lot of reliability problems with it...and it's all because the concentration was on the higher volume business with the trunk amplifiers and line extenders...

TAYLOR: It was that volume problem that kept people like C-COR and Magnavox (Craftsman) out of the headend...their volume wasn't big enough. SA started the other way around, they started with the headend...

JEFFERS: Right. Therefore, we lost a lot of market share to that, somehow or other. Over the years, Jerrold production in all the basic things in cable systems other than headend has been pretty good. But you almost have to make two different models, and two different standards. We also got into mechanical design. It was a nightmare. We started our so-called Commander III in a way where it would be a basket holding six commanders, but we decided, "Hey, that's the wrong way to go!" We still have to make them as individuals, and we didn't want to back track enough to Day One. We wanted to use some of the engineering that we had already done which came out with the Commander III, and therefore Commander IV, which was really an upgrade of Commander III.

TAYLOR: You never put out one with a basket of these things did you?

JEFFERS: No.

TAYLOR: That was left for Arie Zimmerman to deal with!

JEFFERS: Yeah, but we backed out of that. So, its unfortunate that while we were very successful in the sense of starting the process, but we didn't carry it through in the production. The Commander VI that we have right now, which was made for us by ALPS Electric who we were in heavy association with during the converter area. They once really did an...

TAYLOR: What's the name of that company? Would you spell it?

JEFFERS: ALPS.

TAYLOR: ALPS. I don't know them.

JEFFERS: They're a great company. Great Japanese company. Of course now all of our converters are made in our own Taiwan plant. But if you go back to the early stage of converters, I'd say for 10 years, it was all ALPS Electric building for us. Really a class, class outfit.

TAYLOR: They're in Japan?

JEFFERS: They're in Japan.

TAYLOR: Tokyo?

JEFFERS: Yes. You might know them if your a car radio bum, because they are Alpine.

TAYLOR: Oh, I've heard that name. Oh, I see.

JEFFERS: That's one of their U.S. components. Another thing they are. They are the biggest producer of television tuners in the world. Its astounding the things they do. Tell you another thing that's absolutely surprising, they are the biggest producer of potentiometers.

TAYLOR: You don't say.

JEFFERS: They build them for somebody else. They're a fascinating company. Typical Japanese, but great to work with. But, we got them to produce Commander VI for us. The Commander VI I'm telling you is an excellent product. Those guys have a manufacturing technique for that type of product. Jerrold did not, and I would guess to this day, does not. Because it's more psychological up here of management, who say, "OK, its just another product along the same line, just like test equipment." And all that really should be separate entities.

TAYLOR: I guess cutting out all the test equipment was the thing that really upset Ken.

JEFFERS: Well, of course Sid Fluck from Calan was part of that too.

TAYLOR: Sid?

JEFFERS: Sid Fluck, who heads Calan, which is...

TAYLOR: Oh, yeah, FLUCK, CALAN.

JEFFERS: That's it, they'd done excellent work but Sid was out of that group. They had another guy down there, who retired to come to that group.

TAYLOR: Well, of course the product line was sold to Jim Luksch of Texscan, that little Indianapolis Company.

JEFFERS: Yes, we came to that agreement. But it was a smoke screen. The only big product that went to them that was important to us was the Field Strength Meter, the 727 Field Strength Meter. Nate Dolan sold it and we got a commission. I'm sorry, we sold it also, you know. It was in our product line, but they handled that. They were a pretty good outfit. I got to deal with that part of it and closing our contractual arrangements.

TAYLOR: That was another surprise when Jim Luksch and Carl Pelke stepped out and set up the whole Texscan amplifier line and expanded the instrumentation enormously. Then they bought GTE Sylvania CATV.

JEFFERS: Yes, and they are still producing. That's where Bill Lambert is these days.

TAYLOR: That's right. He came in after the bankruptcy and part of the reorganization.

JEFFERS: Probably the guy who had a hand was Bill Firestone who was also president at Jerrold.

TAYLOR: Speaking of Sylvania, did you know Dan Lieberman...

JEFFERS: Yes.

TAYLOR: ...who worked with Sylvania when they first started? Dan had me come up to his place Syracuse I think it was. He was the first one I'd seen that was so gung-ho on the single ended amplifier and felt that he could adjust the bias properly and get phase-out of the second order. He pushed it, and pushed it, and pushed it. Then I got a call to AEL, because they were pushing the same idea and...

JEFFERS: ....and by the way we used it in some equipment I designed, but strictly for apartment houses where they were single channel amplifiers. And, first of all, apartment houses where you have a framework and we just plug in...

TAYLOR: Oh, yeah, I remember that.

JEFFERS: I used that technique but that was strictly... The big problem you have with single ended amplifier is sync compression. And you can't build a feed back system to... as the sync goes down, you boost it again. But when you get into broadband amplifiers... We first used that technique... I'll tell you where we used it. We used it on my Univamp amplifier that I said was a high gain amplifier. There's another quick story too. The negative... Doing this across the range and we're checking cross modulation and say, "Hey, that's holding up good." Then we decided to look at pictures. Frank Ragone and I learned one lesson. Do all the testing you have to, but...

TAYLOR: ...look at the pictures!

JEFFERS: Of course it was just for handling the sync compression part of it, but not the overall distortion. You learn these lessons by your mistakes that you never forget. I was talking to Frank the other day. He's still working for Comcast, although he asked to go into retirement but they couldn't pick up a guy. [???] announced that internal person and Frank's just staying on while they train him, a couple of months anyway. But, he still comes into Jerrold. And of course, Jerrold has finally, after a lot of my insistence, have gotten to the point where we have something like 80 channels of headend, all headends, with subjective testing. We've always had all the instruments for testing, and we have all those fans to raise the temperature, all that kind of stuff. But they're just new. When I was at Jerrold, I'm talking the last couple of years, I had a headend of my own. Then we tied in with the headend, which was Commmander Vs, to do a lot of subjective testing. But now, they completely put in something like an 80 channel -- 85 channel -- headend of all Commander VIs. They're really getting up to really good subjective testing. And I've heard they have... I used to be up to about 20-22 sources of video. You know, off-the-air, satellite and other sources. They're probably even higher, but quite different number of sources. I was in there just as they got the headend coming on, and working. They're going through all the testing, the band, and all the cross-mod, second order and composite triple beat, and [???] says, "Now lets look at the pictures! I ain't doing anything till I look at the pictures."

TAYLOR: That's kind of the reverse of the experiences I had in the early days when I'd go around and want to look at the video waveform. "What's that?" is what I'd get. "How do you do that?" So then they'd give me a vertical wave from, and say, "There it is." And that didn't tell me a thing. I think we're getting more sophisticated in the industry now. A bit. Still got a way to go.

JEFFERS: You know we were talking about Times. Of course, this event goes back to Eric Winston and Ken. Ken and Eric used to work very, very well together. We did a tremendous amount of testing on cable... tremendous amount... and work with temperature...

TAYLOR: I knew that Ken had done a great deal on that.

JEFFERS: Ken built a special chamber to measure radiation from the different types of cables and the effect of solid sheath aluminum, all that kind of stuff. But we did plots, all the temperature plots on the attenuation of cable with temperature, across the frequency. But it's interesting, one of the things... It's not a major thing to worry about, but there's no question that as you go through freezing, there's a slightly different tilt...

TAYLOR: Oh, really?

JEFFERS: Because of moisture in the cable. You know the old rules are certainly good enough but when you really get down to it...and then Times had this pentene gas...did you ever hear of that? Its part of their injection system of putting the stuff in there using the gas. Oh gosh, don't let it be a little leakage in the gas. And what guys were doing, you know a man servicing would open the housing, and there would be times he would have a cigarette and....or he'd be working there and "Ker-Pow!!"

TAYLOR: I'll be darned!

JEFFERS: There was a thing called the black center conductor.

TAYLOR: Oh, yeah. Oh, Lord.

JEFFERS: We did an awful lot. I'm only emphasizing the work Jerrold Labs did in analyzing the cable even though weren't producers of it...only to have our knowledge and protect the overall system.

TAYLOR: Yeah, we had a... Sammons -- I guess, in Kansas City, Kansas, somewhere down in there, one of the little suburbs of Kansas City -- had put in Dynafoam cable and they had black center conductor all over the place. It was fierce. So, then there was a three-way battle, because some of the cable was Times and some was CommScope, and Gardner had done the construction...Who else was involved? I'd forgotten. Anyway, big battle over who was responsible for all this trouble.

JEFFERS: (Couldn't hear beginning of this)...and of course, we both know that the worst thing that can happen out there is bad cable... They try to change or modify amplifiers...

TAYLOR: Oh yeah, the cable. We ran into one in Montana, which is back in the days when you were using RG-11, and the signal just simply would not go down on one channel in one of the alleys. It just would not go. Finally, after a great deal of study and effort and what not, we found one of these suck-out things in the cable that you wouldn't believe.

JEFFERS: Another statement I often make when talking to people, knowledgeably about CATV is... As you go through, starting in the 1950's right up to now, when you look at 3 channels, then 5, then 12, then 20, then 27, then we're learning all these things, and the products and all... Sometimes we forget the great, great progress that helped coaxial cable manufactures. I don't think they get really enough credit for...

TAYLOR: I think that's right.

JEFFERS: They have done marvelous things with that coaxial cable in terms of shielding and in terms of match across the band, all that kind of stuff. They deserve one hell of a lot more credit than the people take the time to give....

TAYLOR: The big battle that we've run into internationally is copper versus aluminum. Almost every body in the rest of the world is prejudiced against aluminum for corrosion reasons. We were in Singapore recently and the telco there, Singapore Telecom had simply made a flat rule there would never be any aluminum in our system. They had some aluminum and they took it out. I'm not sure what it was, whether it was wire, instead of copper, or whether it was a coax, but we had a terrible time trying to persuade them. I'm not sure we ever persuaded them. We had the same thing in Israel, although the Bezeq there finally accepted aluminum. It's been that way everywhere. They are just dead set against aluminum. But you look at the cable they produce in Europe, my gosh, they fall far short of what our people produce. And as a matter of fact, I had a call -- this is about maybe 8 or 10 years ago -- from Nokia in Finland. They had just developed this new aluminum cable and said, "Performance is excellent." They wanted me to review their specs. I said, well send them to me and I'll take a look. I reviewed them and got Times catalog out, side by side. So when I called them back I said, you're not as good as what Times is selling here, in a few respects. Mostly OK, but Times has got you beat on 2 or 3 points. You could hear the lead falling on the other end. He was really disappointed because they thought they had a major breakthrough. The breakthrough was that they were willing to talk aluminum, which they hadn't been. (Long pause). Fiber. We haven't talked much about fiber. Jerrold hasn't been a big factor in fiber optic development.

JEFFERS: Well, in fiber itself?

TAYLOR: Well, fiber systems.

JEFFERS: I think you're wrong here.

TAYLOR: OK.

JEFFERS: I'm not 100% up on where we stand right now. We certainly built very good fiber transmitters and we...

TAYLOR: You're right. I'm forgetting about that.

JEFFERS: And, was it Ortel we had an agreement with?

TAYLOR: They're probably one of them. You probably have others.

JEFFERS: And generally speaking...I'll tell you TAYLOR:, I think we got off the ground a little slower.

TAYLOR: That's probably what's created my feeling, yes.

JEFFERS: But I think if you ask now, they are doing very, very well.

TAYLOR: Yeah, I think I was wrong.

JEFFERS: Now, before I left Jerrold, the lab I was heading...Well let me add a little something to my own background because it bears on this. I was made Vice President at Jerrold in 1968 and I held that directly till 1981. At that time Jerrold was getting so big that Jerrold broke into two divisions. One was distribution, which is all outside the home. And the other was really an effective converter division, anything inside the home. But at that time, something I pushed for a long time was a little more emphasis on R&D. So in 1981 I became Vice President of the Research and Development, just a small group. We built up to about 25 people, mostly engineers. It was in that group that we started to do all the modern development.

TAYLOR: Oh, I see.

JEFFERS: And we had... They've really cut it back now in the last 2 or 3 years, and then got... I understand they are starting to build it up again. I think it was mostly because they needed the experienced engineers in that group to come up and go in on the digital television and all the things that eventually got in production. And they thought it wiser to do that, and I would agree with them. But back in my group, a lot of work was done in fiber and investigations. We had one lab back there we put a lot of money into, fiber studies and all different types of fiber transmissions. And we productized some of it with transmitters and some of the receivers and all. We made it very successful. I agree with you. I think we were... Right at the outset, we might have been a little behind. My impression today is that we probably sell more fiber equipment then anybody. And we worked with Vince...

TAYLOR: ...Borelli, at Syncronous?

JEFFERS: Yes, at Syncronous. We worked with them quite a bit. Of course, it was not that long ago, only about June or July, I was down at CommScope and certainly they're in cable, and an awful lot of fiber. I don't know whether they are drawing their own fiber, I'm not sure. CommScope had an interesting -- Frank Drendel himself personally--had a interesting connection with... what was the big European...?

TAYLOR: Alcatel?

JEFFERS: Alcatel, yes. Big connection with Alcatel that I never knew. I was over there, too. I wouldn't be surprised if he's buying his basic fiber from Alcatel. But anyway, their cable down there, beautiful facility. I was very impressed.

TAYLOR: I haven't seen the facility. I have seen catalog materials and their shows.

JEFFERS: It's amazing, it's really astounding. So, but there's no question that Jerrold, like Scientific Atlanta and the others, are dedicated to fibers for most of the equipment.

TAYLOR: There aren't many people drawing glass fibers, Corning of course, and Alcatel those are the major one I know of.

JEFFERS: And AT&T.

TAYLOR: That's right. There are a number of people cabling it.

JEFFERS: Through Drendel, we were getting interested in Alcatel. About 4 years ago, I went over to Paris and we met with them. And we were talking about different things, what one company can do for the other. Then they gave us a tour of some of their facilities. Oh, I know. They took us out to show us their fiberoptic system, where I think they had... This was fiber right into the home, right into their...

TAYLOR: Is this Paris?

JEFFERS: Yes, right out side of Paris. They had a nice converter, all their signs of work in the U.S. and they showed us that. We were out there in this area and they have one of the buildings there dedicated to this demonstration where everybody was coming out of it. And I'm looking around and here comes...déjà vous...this looks very familiar to me. And I said, "Hey, do you have a building back there that draws fiber?" They said, "Yes." I had been there about 8 or 10 years before... It was Thompson at the time. That's the first place I ever saw developing the fiber. That's where I got my education as to the mechanics of how they do the fiber and it was funny, cause I had been their. We didn't go back to see that facility because I'm pretty sure they expanded it tremendously. But it was very interesting to know how long it had been that those guys had been back their drawing the basic fiber on much or through equipment that you see. The Corning place – my god! That was tremendously so...

TAYLOR: I went to Corning in 1973, but they wouldn't let me anywhere near their drawing tower. That brings me to another thing. Have you heard about the patent that turned up in the Maxwell estate? Maxwell was the guy that went swimming in the Canary Islands. There was a patent and the effective date I believe is December 1973. That was a year before it was patented in England and a little later in the U.S. But it talks about using optical fiber for CATV for distributing television. The Maxwell estate have suddenly realized that this patent could be applied to people that have used fiber for cable television all over the world. They are talking about trying to bring actions. I had a call from Scott Este at Corning, about a month ago, then they sent me a copy of material describing how all of this came about. So, I said, I had been in Corning in 1973 and looked up the records, and it was in April of 1973 and the reason was that they had asked me to explore with them how could we use fiber in cable television. I told Scott about that, and later a fellow by the name of Bart Bielowski at Corning had delivered a paper at the NCTA Convention in the Spring of 1973. And so they asked me if I could give them a copy of Bart's paper and I copied it out of Technical Paper transactions, sent it to them and, man they were very excited, because this seems to be prior art to the patent.

JEFFERS: Who's patent, the U.S. patent?

TAYLOR: It was a U.S. patent, but the one they were concerned about was the earliest date, that anything that can be applied was December of 1973, so...

JEFFERS: But, right now the patent has run out but I guess they could...

TAYLOR: But, they could apply on the people that used it. So, what I was going to ask you really, did your work...did you have anything prior to say December 1973 in which you were talking about fiber for cable? Bart Bielowsk -- I think, I can't remember his name exactly -- Also wrote an internal document at Corning in which he proposed the same thing, but the lawyer at Corning says that the internal document is not as useful as the one that was semi-published. Some people don't call our technical papers published, they don't have a wide circulation, just for members. A little bit beyond member, but not widely, they don't go to libraries and things of that sort. It's interesting that patent is coming to life. (Pause). Were you involved in the compression developments, digital compression?

JEFFERS: Not really. I was pretty much phased out of Jerrold by that time. The best answer is no. I had only minor association...

TAYLOR: How about a gigahertz bandwidth? Where you doing anything in that?

JEFFERS: No, not specifically. But I don't see that that's a major challenge.

TAYLOR: No, as a matter of fact it was probably 20 years ago, I was in Europe in the Netherlands and I guess it was Phillips who was just very proud of it. They were able to get 30 channels up to 860 and in fact 860 was their broadcast band, but they had 30 channels and it was done by computer determination of which one they could use without getting into trouble. Band width was easy, but performance was the other problem.

JEFFERS: Right now, I'm working with Jerrold to develop a test system... or the combination of a digital and the analog together. And in effect, the whole idea of it is to do all the measurements on the digital, both as a separate unit, its interaction with all the analog channels, and in effect the distortion of the analog channels falling into the digital to find the limits on.

TAYLOR: It's a question we've asked about a long time.

JEFFERS: So, that's underway, and we ought to be finished...In the last few years I've worked on several of these. One we did at Jerrold for all kinds of subjective tests, which you were kind of involved in. Of course, I was heavily involved in the contract that we had with Cable Labs to build the facility in Arlington down there. Now the construction of those is done by a small company around here called Peca, and who, by the way, is an ex-Jerrold employee.

TAYLOR: That's P-E-C-A?

JEFFERS: Yes. So we are right at the point where I was heavily involved in the planning and I've done some of the basic measurements in the beginning. He is now in the business of assembling this all in cabinets. It's a simulated cable system and its more for tests coming up that Jerrold had to perform for TCI. But the reason I bring this up is that they wanted a gigahertz transmission system and of course they way we are building it which is generally at their request...

End of Tape 2, Side A

Start Tape 2, Side B

TAYLOR: You were describing the new system that you built for....

JEFFERS: Yes, and while you don't do fiber optic systems this way, you don't have long cascades in fiber optic systems, its really a throw back from the old. But I found it very interesting. They wanted to get up to a gigahertz. I checked around the Jerrold equipment and the only one that goes above 550 at the present time is our line extender. It's a very good line extender so I talked it over with the chief engineer there of the distribution division and asked him about the line extenders. He says all I'm after is the trunk portion and that's...now preparing to design the trunk, but they will use exactly the same ______ that they used in this line extender. I asked, "Will I have any better performance?" He said, "No, about the same." So I ordered a total of 12 line extenders, two for a feeder line and ten for a trunk line. I aligned that thing + or - 1dB, so about 2 dB of flatness out to 800 megahertz. So, through 10 amplifiers, I had to throw in one mop-up equalizer. I've done basic cross mod and all that, just to see how things are going, before we do the whole proof of it. But, I'm very surprised how good that response was, going from 50 to 750, is what we nominally call.....flat on top through ten amplifiers. So I'm not the least bit worried about a gigahertz.

TAYLOR: You know if you look back over the history of the industry, not so much manufacturing, but in the industry, the change of the converter brought in the change from 12 channels. Suddenly, we had the ability to go to almost an unlimited number of channels. That was about late 1960, '67 -'68 when that began to happen. Then things began to level off again during the '70's until that famous prize fight out in Manila when we demonstrated the ability of transmitting by satellite. That then opened the door to new programming. We didn't have to depend on distant signals anymore. Those two things really turned the industry up side down. Stirred it for a fare-you-well. Well, we are in the middle of another period right now. There are so many thing going on, you have no idea where its going to end up. We've got competition coming in, the telephone company, DBS, those are the principal ones probably, overbuilds, the same sort of thing. We've got gigahertz and an infinite number of channels, talked about 500. The whole problem of navigating even 100 channels is a very real problem that I don't think has been solved yet. There are a lot of efforts, but the real problem is to enable people who don't know how to do a thing, can't even tune the TV set, let alone make the VCR work. So trying to navigate through 150 or 500 channels is another deal. Then we've got HDTV coming along, the whole digital revolution, compression; you have no idea what's going to happen in this industry.

JEFFERS: Yes, but boy it's exciting.

TAYLOR: Oh, is it ever. If you've got money invested in it, it's worrisome because you don't know which way to turn. If you are big enough, like the MSOs, the TCI's, the Viacom's or the Time Warner's, you've got opportunities you can move into. But if you are a little guy, even a small MSO like Adelphia, man that's rough to decide where you going to sit, which direction you are going to go.

JEFFERS: The... (by the way I don't know the Adelphia system)... But it's interesting. They're obviously rewiring their whole system to get the fiber nodes...They are a good outfit.

TAYLOR: Yes, they are. No question. There are progressive, but also limited because they are small and they can't do the sort of thing that Time Warner is going to do in Orlando, spending an infinite amount of money to...

JEFFERS: Well, then you add to it; and I'm sure you are far more an expert on this than I...the TCI/Bell Atlantic deal.

TAYLOR: Oh, gosh, that's explosive.

JEFFERS: It's unbelievable. I think it's good...I think it had to come, let's put it that way. I don't know whether it's true or not. I think it had to come, but it's unbelievable.

TAYLOR: And where it goes from here is a big unknown. A story in the paper this morning about Gore's speech in California...Some of the things he says are good, but some of the things that aren't said are worrisome.

JEFFERS: But over the years he hasn't been too friendly to cable.

TAYLOR: Indeed, he hasn't. So, it's awful hard to tell. One thing I find though is that the telephone companies think they know every thing, but they don't.

JEFFERS: They really don't.

TAYLOR: They have got a lot to learn. I think one of the classic examples is fiber. For the telephone company, it's digital. That's the only way to go on fiber. Everybody knows that a laser is not a linear device, so you've got to got digital. So what do the stupid cable people do? They go analog and make it work, and it works so well, that the telephone companies are now using it.

JEFFERS: It's a fascinating time.

TAYLOR: I remember Raleigh Stelle invited me to one of his dinners when Texscan was still not bankrupt. Raleigh would have a marketing table and he called in a few people and invited me to come. I was a little late getting to the dinner -- Las Vegas I think. And when I got there, there were, like 8 seats and 1 vacant chair. Raleigh started introducing. This guy is with Michigan Bell, and every one was with Michigan Bell. I sat down in the middle of all these Michigan Bell people. I started out by telling them, You guys have lived with cost-plus operation for so long that you really don't know how to do an entrepreneurial job. It shows up over and over again.

JEFFERS: There was another group that meets that fascinates me and I used to attend all the time for Jerrold. Unfortunately, we have a fellow from Jerrold attending regularly now. But I've been absolutely astounded at the lack of support by the cable industry for this group, and it worries me. And that's the joint NCTA/EIA meeting. You go to that, and there are only one or two cable people there, and the rest are TV manufacturers...

TAYLOR: Yes, Walt Ciciora said this at the last engineering meeting I attended...

JEFFERS: But we've been saying that for ages. Even when I used to go, I'd come back and report what they're doing, worried about this, and worried about that. But there was no question that the TV set manufacturers, sure as hell, don't like converters -- they never have. But they are doing everything, in this so called standard setting meeting, to have a major impact on the cable.

TAYLOR: However, at the last session that I attended of the engineering committee, I think it was November, maybe...

JEFFERS: ...I think it was October.

TAYLOR: Wendell reported that the proposed rules that had come out followed pretty closely what we wanted. Still not very definitive, but there was not too much that we could quarrel with.

JEFFERS: It's astounding how long they take, because I'm really out of it for just about 2 years now, and the I-6 was just then coming on, and I was heavily involved and had to go back in 6-7 years. And they still refer to one as I-23, when I was heavily involved in some of the stuff in the proposal...

TAYLOR: This is the interim preliminary standard...yeah.

JEFFERS: Yes...

TAYLOR: One of them, the 6 I think was the channelization and the other had to do with...well it was cable ready basically.

JEFFERS: Yes, cable ready. I'm surprised at how long they've gone on without the...

TAYLOR: You know both of those things came out of the C-TAC meetings in the mid 70's, '74 or '75

JEFFERS: Yes, I was involved in the C-TAC meetings.

TAYLOR: Yes.

JEFFERS: Oh, I loved it. Not to talk about C-TAC, but I loved those guys from the television sets manufacturers.

TAYLOR: Oh, yeah?

JEFFERS: Ed Chambers...

TAYLOR: Oh, my gosh, I remember Ed Chambers.

JEFFERS: I'll tell you, he really represented his company.

TAYLOR: Did he ever.

JEFFERS: But it was almost like, "How does cable have the nerve? You know, they are so subservient to our guys there." Charlie Hewitt...

TAYLOR: I didn't know him, but I knew Ed Chambers.

JEFFERS: Charlie worked for receivers, too. Charlie was the best guy I ever saw. I thought he was absolutely great. He was right down the line with logic and he was incorporating both of them. I thought very highly of him. Of course, Ed -- I don't know what happened to Ed. But, it was the attitude of them. But there is still some of that attitude there. You go to that meeting, and you're sitting there and you wonder what's really going on. There are people from cable. Jim Farmer was always there, but Jim and I and maybe one other guy. And the next thing you know, there is all these other people.

TAYLOR: Well, hasn't Walt been carrying that ball too?

JEFFERS: They might be.

TAYLOR: Well, did you ever hear Hub Schlafly tried, back in the very earliest of the converter days... You know, the converter really got started because of New York City. If they were going to have to offset channels, there were only 12 VHF channels and 7 VHF stations, so you're in trouble right off the bat trying to do it that way. So the converter came along and Hub, shortly after that, got concerned that, "Why couldn't we have, instead of having a whole tuner and the whole bit and up converter and so on, why couldn't we take the IF out of the TV set do the processing on that and then go back in again." He kept trying to talk TV manufacturers into it and they kept telling him well there isn't any place like that. There is no place in the circuit that will do that, and so on. But they wouldn't give in by trying to design it. Of course, we only had 2 or 3 million subscribers at that time, maybe not even that much, maybe a million. But this battle has been going on a long time. In those days, in a way, I can kind of understand the manufactures position because only a few of the sets were connected to cable, so they couldn't let the tail wag the dog. But now, its the other way around. At least 60 or 65% of the sets are connected to a cable and now they must have their heads in the sand.

JEFFERS: Anything else we haven't covered?

TAYLOR: No, I don't think. I did want to get into thinking about the future a bit, on what your thoughts might be and so on. We've been at least touching on that, and if you have any further thoughts as to where we might be going...

JEFFERS: Well, this is the future at a time back in the 1960's. It was about that time when a lot of the great thinkers in cable were talking about all the blue sky stuff that could be done, you know the telephone, and all kinds of marketing like putting your store order in and doing the banking, and all that kind of stuff...

TAYLOR: Meter reading, home security...

JEFFERS: Yes, I got to admit that... One thing -- and I'm sure I'm maybe one of 3 million people trying to say this, not at all original -- that I find fascinating that I kept saying, "All that stuff is a bunch of crap." And I said, "With one exception and that's marketing, selling goods." That's the one thing I can see that makes more sense... when you look at QVC and all that... that people could buy, and it would come up and it wouldn't really need a two-way system. You could send things in...Another thing, to this day, there are so few two-way systems out there.

TAYLOR: That's right.

JEFFERS: One of the hopes of fiber I think is...

TAYLOR: ... is to make it...

JEFFERS: ...is to come to a relatively small area coverage node...

TAYLOR: ...then you don't have the problems.

JEFFERS: That's right. I got called in the other day. They had a new young man they hired, Dr....in marketing. Pretty nice young man. He was brought in to come up with studies on all this kind of stuff that can be done on two way systems. So they asked, "Who knows the most about two way systems." "Well, really Mike JEFFERS: knows the most about it." So I got called in, out of the blue, asked would I please come in and talk to this gentlemen. I did it as a courtesy. It's unbelievable to sit there and see this young knowledgeable person -- with his beard -- and he's going in there to figure out... and this is all with coax systems. I break little tidbits to him, and tell him you know, "There are not many two-way systems out there." He says, "No, but we know of one, and we are going out to measure that one and I'm going to find the description." You try to be nice to him because this is his project and I didn't want to down him. I said, "You know, there is only one thing you are going to learn. It is how good is that two-way system. In a sense it's going to be meaningless." "No, no. We'll get along with that description." I'm telling him some of my experiences out there, and he didn't to hear it. He was going to expand on this, and I'm telling him little minor things like, "The systems are changing. You don't really have a stable position. Maybe when you get to fiber you can talk about principles. I have no question whatsoever that when you take a smaller area around a fiber node that you get back very easily to that node. And, as a matter of fact, if you're on the ball, you can probably get back to that node without going through any active amplifiers."

TAYLOR: Very possible.

JEFFERS: I said, "That's the way you want to look at it. Because you don't want to have a reliability problem at every line extender that you have going back. You've got to be able to bypass these, and if you are going to use a little sub region you can get back." But telling him about that, I came up with a very good way of expressing two way systems once. And I'll just put it in the record, because in an easy way, it tells you what you're up against. You can compare a cable system... "When you're talking two-way, you can compare it to a water company. Here comes pure water down the road, it goes to the house, gets distributed, everybody has a nice clean bath and all that." And I said, "Then it goes into a sewer, and that's the return!"...

TAYLOR: That's exactly what we've got!

JEFFERS: You have every kind of distortion, you have power surges that effect the return system. I said, "You can't imagine all the things that happen to the return system. It's just garbage, and you have to work in that area. There's no kit for that." We did one test on the Akron, OH system, which was dual cable, each cable 800 miles of cable. And we did a test -- not that we wanted to do it. But we were in a big -- I wouldn't call it a contract. But it was really a virtual legal suit type thing where they were holding up for the basic performance of the forward system, but they insisted on adding to it, and had thought -- since the contract -- they might want to do the return. And I said, "We ran a system out there for them just to get ourselves out of a potential legal suit of many millions of dollars where we sent digital information down...." We had a thing at that time... I don't know if you remember, we introduced about 1973 called Communicom, which was one of these thing that never got off the ground. A lot of work was done. But we had the essence of that. We were running a 2 megabit rate, pretty advanced at that time for that, and we had a 32-bit word. And what we did was, we got to the headend, we would send this out and put a turnaround system at one of the furthest parts of the system, and it came back in a low frequency... I'm sorry, it was a two-way system at the time, but it had no original specs on the performance. So hear comes this 32-bit word, and if any one bit came in error, that was a fault, and then the return would pulse the next word. We had error counters, and we would sit there at the headend and practically fall asleep, and then BOOM... a surge...one shot...and then it would go again. We could relate it pretty much to power. You could almost tell by the time of day and then you would see all the other crap around it. But it was the perfect example I'm telling you of the problems you're in on a return system.

TAYLOR: Was Al Stern in that or was it after he sold it?

JEFFERS: No, he was still there...Oh, yes, it was after he sold it.

TAYLOR: It must have been Cypress, was it?

JEFFERS: Well, it wasn't Al, Gus Hauser. He was at the system at that time.

TAYLOR: Oh, Hauser? Ok. There had been another transaction in between. It was Cypress, or something...I think Bert Harris was involved, but Warner acquired it, Warner-Amex at that time.

JEFFERS: Yes. He had a VP of engineering that I never like very much, English guy. I'm sure he's still around. But, we happened to beat our specification, but it was pointless, you still couldn't use it. We had no idea what was going to come back... We had just rebuilt that system. It wasn't as originally contracted. We spent a fortune on it.

TAYLOR: You had worked with Al Stern on that return system I think, I mean your company did, because Krieger, what's his name, Dick Krieger had spent a lot of time...I talked to him a lot about that project, he learned a lot of things. One of them I learned from him that I had not known about before was the intermode from the forward channels that intermode at a corrosive spot in the connector and feed back.

JEFFERS: I was with Dick another time, when we learned, but not on that system. We were in Spartanburg, NC and we learned two things. The little cores that you build RF transmitters with...the type of core material that we had, if the insulation of the wire is cut and goes against the ____ point, you can't believe the amount of distortion you come up with.

TAYLOR: Really.

JEFFERS: Another thing...sometimes you're lucky and sometimes...

TAYLOR: ...you're not.

JEFFERS: On that system, it was a full two-way system but also we had a leakage spec, anything leaking out of the system. And we are out there with the receivers to pick up the key tones on the systems, and it's terrible, it's terrible. And we're up here, and the amplifier has gone way out of spec and we... It was right about at multitaps coming down the line. Of course we wanted to be perfect for these systems so we had every one terminated, and we were trying to figure out where it was. Except, what we had designed was a cheap terminator, which was completely enclosed in metal, and the little tip being soldered to the resistor. But all it was, was a push-on, not a screw-on. I had Dick take the terminator off the unused spigot, I mean hanging in mid-air, the whole thing disappeared!...It was a lot better without it! The terminators became radiators and everybody was so clever, you know everybody was proposing, boy, you ought to keep it in there and keep it terminated. I got to a phone and called back to stop the design. We never really got it. That would have been disastrous for us. The screw on terminators are fine but you come off thinking...(Both talking at once). We were very fortunate going back ...the use of the cores and all that kind of stuff can give you a hell of a distortion, and that's talking about any two-way system. You're always getting distortion that comes from the outgoing channel but fall into the _______. So I'm all for...

TAYLOR: We're just about through here. Just wanted to ask you one thing. Do you have any material like papers or catalogs that you want to donate to the Center, and if something you want to keep, we can make copies and give you the original.

JEFFERS: I have a lot here, but I'll to go through it.

TAYLOR: Ok, if you take a look a that and get...

JEFFERS: You did ask about patents while we were sitting down, cause I called into Jerrold and I was supposed to have a packet yesterday or today, but I can got it over to you.

TAYLOR: Ok, fine. Well, I thank you very much, Mike. It's been fascinating. I really enjoy all the reminiscing we go through and a chance to learn some of what happened that I only suspected in some cases and didn't suspect in others. It's a fascinating time. And I thank you for giving us the time on this. I will have this transcribed, and don't hold your breath because its a very slow process. When I get I transcribed, I'll send it to you to review and I will also mail a deed of gift, a copyright to the Center, so the Center has the rights; you can define it in various ways; appreciate having that done. Thank you again very much.

JEFFERS: I enjoyed it Archer.

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Ed Jarmain

jarmainEd5

Interview Date: Friday September 21, 2001
Interview Location: London, Ontario, Canada
Interviewer: Ken Easton
Program: Hauser Project

EASTON: This is the oral history of Ed Jarmain, the first cable provider in Canada. Today is Friday, September 21, 2001 and we are interviewing Mr. Ed Jarmain at his home in London, Ontario as part of the Oral and Video History Program of The Cable Center in Denver, Colorado. We're joined today by three of Mr. Jarmain's original employees: Nick Hamilton-Piercy, who is sitting at my immediate right; John Hood on the far right; and Hank Van der Lin. I am Kenneth Easton. Ed, to make a start, can you tell us something of your background, where and when you were born?

JARMAIN: I was born on July the 24th, 1907 at 17 Elmwood Avenue in London.

EASTON: So you were born in London and you've always lived in London.

JARMAIN: I've always lived in London. I was away from London for a short while during the war, but apart from that I've always lived here.

EASTON: Right, and what's your family background? What did your parents do, for example?

JARMAIN: Well, my mother was a housewife as all the ladies were in those days, and my father owned and operated a laundry and dry cleaning plant.

EASTON: Oh, yes. That's the business you came from, isn't it?

JARMAIN: That's correct. I inherited that.

EASTON: So at the beginning of the history we're now discussing, you were actually in the dry cleaning business.

JARMAIN: That's right.

EASTON: And where did you go to school? Here in London presumably?

JARMAIN: Yes, Victoria School on Wharncliffe Road. The school building that I went to has since been replaced but it's still a school property.

EASTON: What kind of interests did you have in those days as a youngster?

JARMAIN: Well, I'd say it was largely mechanical.

EASTON: It was?

JARMAIN: I had Meccano Sets and we used to build trucks and all sorts of things with Meccano. I think that was my favorite toy.

EASTON: Until you got interested in radio. When was that? How old were you then?

JARMAIN: Oh, that was about 1920 and I was born in 1907, so I must have been 13.

EASTON: You were 13. And that's when you started getting an interest in radio. Did you build a radio receiver at that time, or what were you doing?

JARMAIN: Well, I read an article in the newspaper, which stated that a chap by the name of Jim Macintosh was going to be giving a lecture at the YMCA on radio and it sounded to me as if that was interesting. So I went to it and of course after the lecture I met Jim, and to make a long story short, Jim and I became very staunch friends for the rest of our lives. But that was my first introduction to it.

EASTON: That's when you started experimenting in radio, is it?

JARMAIN: Soon after that, yes. I started out, of course, tagging along with Jim because Jim was considerably older than I was. He was old enough to be my father and he was an employee of Bell Telephone at the time. So he fixed telephones in the daytime and experimented in his workshop in the basement at night.

EASTON: And you experimented with him?

JARMAIN: I experimented with him.

EASTON: And then did you progress then into building radio receivers at that time?

JARMAIN: Well, it started out with hi-fi equipment. I built that too.

EASTON: Hi-fi being high fidelity.

JARMAIN: High fidelity, that's right.

EASTON: It was fairly early, was it not, that you found or got interested in FM, frequency modulation? There were some FM radio stations which you were receiving, is that right?

JARMAIN: Yes, it was fairly early on. I started out, of course, with radio but I soon heard that there was an FM transmission from Detroit and Cleveland.

EASTON: Oh, you heard of it? You didn't discover it by listening to them?

JARMAIN: I heard of it. I can't tell you now whether I heard it over the radio or how, but...

EASTON: Then you started to listen to one or two of these FM receptions. Was that when you discovered that one of the stations on the FM band was in fact a television station?

JARMAIN: No, that really wasn't a discovery; it was sort of a well-known fact because the advent of a television station in those days was quite an event since after all that was the first one in this area.

EASTON: Even here in London?

JARMAIN: Yeah.

EASTON: So having heard that, you went to try to find it on the FM band, did you? Did you use your FM receivers to try to find it?

JARMAIN: Well, the FM receiver wouldn't have worked.

EASTON: What that really leads to is the next question: when did you first see a television picture over the air?

JARMAIN: Oh, I think that would have been in the early '50s. My neighbor – I say neighbor, a man who lived two doors to the east of here...

EASTON: That was Frank Geary.

JARMAIN: Frank Geary was a Philco distributor and he had... obviously he was selling his merchandise in the border cities because there wasn't any reception really that was reliable in a place like London. We were isolated.

EASTON: Were there other people here at that time who were buying television receivers?

JARMAIN: Oh, yes, in the border towns. He was a distributor for Philco and of course all of their business really centered around the border towns.

EASTON: But London was hardly a border town. He was living in London and selling along the border?

JARMAIN: London was where his headquarters was.

EASTON: He was selling to people living closer to the border who could receive these pictures?

JARMAIN: That's right.

EASTON: You obviously first heard about cable because you read about it.

JARMAIN: That's right.

EASTON: There was cable being developed in locations in the United States.

JARMAIN: Pottsville, Pennsylvania.

EASTON: Pottsville, Pennsylvania was one of them, that's right. That really got you interested in the possibility of not only receiving television but of distributing it to neighbors and so forth?

JARMAIN: That's right.

EASTON: Would you like to elaborate on that?

JARMAIN: Well, I heard about this experiment that was going on in Pottsville, Pennsylvania. Pottsville was a small mining town down in the mountain valley and they had built up something like about 1,500-1,600 subscribers and their business was going very well. I read about this and Harry Anderson who was a contemporary of mine...

EASTON: Here in London?

JARMAIN: Yes, and Harry and I drove to Pottsville to have a look at this and we spent a couple of days there because the owner of the system, Martin Malarkey, was a very cordial sort of a fellow and before we left on the second day he opened up his books, and I got one look at the books and I said this is for me!

EASTON: So that's when you decided to go into it as a business?

JARMAIN: Well, we decided in the car on the way back, but yes, you could almost say that was when I decided it.

EASTON: And having made that decision, you then returned to London. What did you do next?

JARMAIN: Well, we had to sort out who our partners were and who was going to do the financing. There were Harry Anderson, who was a car radio installer in this area and was one contender. I was another. And Frank Geary who lived two doors over, who was the Philco distributor, he was also interested. The sad part of that was of course that – this would have been in the early summer – and by the time September rolled around and we were just getting going...

EASTON: This was September of 1952?

JARMAIN: '52 is correct. We had the misfortune to lose Frank. He died very suddenly of a heart attack. So since he was really the bulk of the money behind the project and I was the instigator, so to speak, that left me in a hole. I didn't have enough to finance what we needed to do.

EASTON: I believe that not only was Frank Geary helping you finance the operation, but also you were using a very large antenna which partly used his property, didn't it? Next door.

JARMAIN: Yes, that is correct. That's how he became interested. That plus the fact that he was a Philco distributor was another reason.

EASTON: And what was the first programming you were distributing? Were you receiving one station from Cleveland?

JARMAIN: No, we were receiving... I think it was five stations from Cleveland and Erie. The reception from Erie was quite good because that was only about 80 miles but of course the Cleveland antennas were 110 miles and it was pretty iffy.

EASTON: You couldn't receive at that time from Detroit, could you?

JARMAIN: We could. Actually Detroit was a pain in the neck because we kept encountering co-channel interference.

EASTON: Oh, it was interfering with the stations you wanted?

JARMAIN: Exactly.

EASTON: You started then by erecting cable on your own poles on private property to reach your neighbors one after the other.

JARMAIN: This was building a trial system.

EASTON: Until you had what was it – 15 people connected? – that you decided the trial was a success. Was that right?

JARMAIN: Well, the trial was set up for 15 people. We didn't start until we had 15 people who agreed.

EASTON: And then what was the trigger that took you from a trial at which you weren't charging any fees at all, to converting it to a business in which you started to charge your customers?

JARMAIN: Well, there was a lapse there of about 6 or 8 years.

EASTON: Oh, years! As many as that? When did you start charging then and making it a business?

JARMAIN: I started charging as soon as we had a signal that I considered was reliable enough. I had to tell the subscribers in the beginning that they wouldn't be able to rely on good reception every night.

EASTON: Which is why you didn't charge them to start with.

JARMAIN: That's right.

EASTON: That lasted for three or four months?

JARMAIN: Yes.

EASTON: And then when the signal proved to be reasonably reliable, you started to charge them?

JARMAIN: As I had to expand the system I had to get capital somewhere.

EASTON: That was the point at which you did start expanding? You felt you were justified in expanding to a larger group of people. At that time, what was your relationship with the public utilities – the telephone company, the power?

JARMAIN: It was nil because neither the public utilities or the telephone company would allow me to attach anything to their plant.

EASTON: And that was the reason you had to put up your own poles on private property. You couldn't run it on the streets.

JARMAIN: That's correct, that's right.

EASTON: That limited the number of people you could serve anyway. What changed to expand that?

JARMAIN: I guess it was a lapse of probably two or three years or more, and we kept working on the telephone companies for pole rights and they finally agreed to us putting cable on the poles but they insisted that their workmen do the work.

EASTON: "They" being the telephone company?

JARMAIN: That's right, Bell.

EASTON: How about the power company? Did you get on any power company poles?

JARMAIN: That was next.

EASTON: That followed after, then?

JARMAIN: That followed after.

EASTON: So they really followed after the telephone company.

JARMAIN: That's correct.

EASTON: The telephone company was the first company to agree to allow you to go on their poles?

JARMAIN: Yes.

EASTON: At that point, how many subscribers were you feeding without the cooperation of the telephone company?

JARMAIN: About fifteen.

EASTON: For several years?

JARMAIN: Yeah.

EASTON: You mentioned the fact that you had problems initially with your relationship with the telephone company and the power company, that you just couldn't get on their poles, and that was in part the reason why there were four subscribers who were all neighbors who you could reach and only reach by putting up your own poles and running the wire on private property.

JARMAIN: Exactly.

EASTON: You also mentioned and answered around my questions about the stations you were receiving that you could have received Detroit but you didn't and that Detroit was mainly a problem causing interference with the stations you did want. Would you like to indicate what other technical problems you may have had at that time?

JARMAIN: Well, I would say that co-channel interference was the main technical problem, of course.

EASTON: In which the signals from Detroit was interfering with one of the Cleveland stations?

JARMAIN: Well, it was not just Detroit, but if you wanted to receive Detroit, we'll say, Buffalo interfered because we were just about equidistant from the broadcast antennas of Detroit, Cleveland and Buffalo.

EASTON: So what originally decided you to receive Cleveland rather than Detroit or rather than Buffalo?

JARMAIN: Well, because we felt we had good signal more of the time. The signal was more reliable.

EASTON: Did the design of the antenna that you built at that time in your property here condition that in any way?

JARMAIN: Well, you were always working on antenna design in the hope that you could introduce the rejection of unwanted signals from the sides and the rear, and we were never very successful at that. Some antennas were better than others, wouldn't you say, John?

HOOD: I think another point to make here is that Winery Hill is the highest point in London here, and I can remember Ed doing the path profiles for some of these which was all done by hand and we're looking at path profiles that were 100 miles long. When you go to Buffalo you've got the escarpment to deal with and some of those details, so our path to Buffalo wasn't that great except when it came to co-channel it was still...

EASTON: It was great enough to cause you co-channel interference.

HOOD: That's right. As things go on here, you'll find that it's why Ed went to taller towers and how that came about. But anyway, he'll go on to that.

EASTON: Wasn't one of the reasons you chose Cleveland because you decided to use a rhombic antenna, which is a long wire antenna which receives best in a particular direction and the property you had here and the availability of space was such that it was best directed looking at Cleveland?

JARMAIN: You're right on. You're right on.

EASTON: So if the property had been in a different location or a different configuration, you might well have been receiving Detroit or Buffalo?

JARMAIN: That's right.

EASTON: What other technical problems did you have apart from the problems with the antenna and reception in cable as such, and using cable?

JARMAIN: Well, of course we always had the problem of getting the right to erect our cables on utility poles.

EASTON: Yes, I was thinking more of the technical problems with the cable itself and the equipment and so forth.

JARMAIN: Well, I suppose what we were just talking about, tube amplifiers.

HOOD: The tube amplifiers were the first amplifiers.

EASTON: This was before the days of solid state, of course.

JARMAIN: That's right. And with the tube amplifiers, when you've got a blowing snowstorm the houses that they were in of course had to be ventilated and the snow would blow in and the tubes were hot glass and they'd crack.

EASTON: And you had a lot of that trouble?

JARMAIN: Yeah, that was quite a problem.

EASTON: John, would you like to comment on that aspect?

HOOD: Well, I guess Ed had a different situation here because he was building a system eventually for a large city, whereas in the United States you're building a system for small communities, CATV at that time. So when you started to have to build a situation here for a large city of I don't know how many thousand people – it was 30,000 people at that time...

EASTON: At that time Ed was building for a very small city because as he said, until he got the agreements with the telephone company, he couldn't expand beyond his immediate neighborhood.

HOOD: No, that's true. It was SKL Labs amplifier that was used at that time.

EASTON: SKL being Spencer-Kennedy Laboratories.

HOOD: Spencer-Kennedy, that's correct.

JARMAIN: Spencer-Kennedy was what you called a chain amplifier.

HOOD: A chain distributed amplifier.

EASTON: An American designed and built amplifier.

HOOD: Right, that's correct.

JARMAIN: Well, actually that Spencer-Kennedy amplifier was a laboratory instrument. It was never intended in the beginning to be used the way we were using it.

HAMILTON-PIERCY: And there was no demand for it at that point either.

JARMAIN: No, so they were both scarce and expensive.

EASTON: Were you using many of them?

JARMAIN: No, we didn't have a very large system so it never got to the point where we were using in the hundreds.

EASTON: At that time, when you were serving a very limited number of subscribers, literally not more than a few hundred yards away, how many of these amplifiers were you using?

JARMAIN: Oh, I guess...

HOOD: A cascade of three or four, maybe, right?

JARMAIN: Three or four.

HOOD: There was one in the driveway here.

JARMAIN: There was one in the driveway, that's right. There was one in the Young's garage.

VAN DER LIN: And one over on Wartney Road.

EASTON: So you did in fact have some cables extending more than a few hundred yards even though you couldn't feed the city as such.

JARMAIN: That's right.

HOOD: And then I don't know, Ed, what time did the Jerrold tube line extender come along? I think there was something at that time that was used, too, but...

JARMAIN: It obviously came in there somewhere, but I don't know either.

EASTON: Once you got this pole attachment agreement with the Bell Telephone Company and you were able to expand without that restriction, how did your business grow at that point and how did the technology advance to accommodate the growth?

JARMAIN: Well, I would say that it grew slowly.

EASTON: But by what methods? Did you actually go out and sell it?

JARMAIN: It was largely word of mouth because people were coming and asking for the service. Usually they were located somewhere too far away and we couldn't reach them.

EASTON: So you didn't have to advertise or knock door-to-door or anything like that?

JARMAIN: Well, we did some of that but not in a big way.

EASTON: But you were confined to a very small area. How much of the city of London were you able to serve at that time?

JARMAIN: The first serious expansion after we got our agreement with the telephone company was that we decided on an area in the south here, the area around Devonshire Avenue, and I think it was about 500 homes, wasn't it, John? Do you remember that?

HOOD: I don't remember the number, but...

JARMAIN: Well, I think it was a small number anyway.

HAMILTON-PIERCY: But those were still quite big lots, though, weren't they?

JARMAIN: We decided it would be the test area and if we could get a decent saturation in that area, why, that would be a good signal to go ahead, and of course we did get a pretty good saturation.

EASTON: And presumably it would also provide you with some of the finance you needed to expand further, which was an important point.

JARMAIN: Oh, yes. Very hand-to-mouth.

EASTON: That's right. We talked about the technical problems at that stage, and I just mentioned the financing, but what were some of the legal and regulatory issues involved during the time of this growth and how did you deal with them?

JARMAIN: Well, in the early days, of course, there weren't any regulative problems. The government hadn't caught up with the fact that we should be licensed.

EASTON: Cable television at that time was not licensed at all.

JARMAIN: Well, it was licensed – they came around once a year and collected $25 from you. That was the license and that was all you'd hear from them.

HOOD: That would be the Department of Transport at that time.

JARMAIN: Yes, it was the Department of Transport.

EASTON: But that in effect would be a receiving license, not a cable license.

JARMAIN: Exactly.

EASTON: And what you did with it beyond receiving didn't concern them too much at that early stage.

JARMAIN: We weren't slicing the bread that thin in those days.

EASTON: Tell me – were there any organizations that evolved in Canada to support the cable industry at that time? I'm thinking in terms of the organizations such as the National Cable Television Association in the United States, and if so, were you a member of any of these organizations?

JARMAIN: Well, I think that the first organization of that kind in Canada was the copy of the one that was operating in the States.

EASTON: The NCTA as it was called.

JARMAIN: NCTA, that's correct, and Fred Metcalf was really the instigator of getting that association going because it had certain advantages. We needed certain rights and privileges and we had to have some kind of a corporate organization to make it believable that we were there and going to stay.

EASTON: And how was that done?

JARMAIN: Well, just that. You started out and their expansion was very slow in the beginning.

EASTON: Was Fred Metcalf the organizer?

JARMAIN: Fred Metcalf was really one of the chief instigators of the formation of the association.

EASTON: You were saying, Ed, that there was an organization which actually became known as the Canadian Cable Television Association, which was started here in Canada by, among other people, Fred Metcalf.

JARMAIN: That's right.

EASTON: And that it copies pretty closely the form of the NCTA in the United States.

JARMAIN: That's right.

EASTON: Do you want to elaborate on that any further?

JARMAIN: Well, I don't think I need to. That was the story.

EASTON: It did eventually become a literally Canadian association. It wasn't associated with...

JARMAIN: It always was a Canadian association.

EASTON: It wasn't part of the NCTA.

JARMAIN: No. We copied it but it wasn't part of it.

EASTON: You, Ed Jarmain, were you a member of the CCTA?

JARMAIN: I don't think so. I think you had to be an American citizen, didn't you?

EASTON: No, no, CCTA, not NCTA. The Canadian Association.

JARMAIN: Oh, yes, of course. I was always a member of that. As long as there was any Canadian entity around...

EASTON: Did you play any part in the organization of it?

JARMAIN: Well, I'm sure I did.

EASTON: Were you at any time a director or anything like that?

JARMAIN: Yes.

EASTON: You were.

VAN DER LIN: Ed was even the chairman for at least one year.

JARMAIN: My son, Ted, was the chairman for two years.

EASTON: Broadening the questions a little bit, Ed, in your opinion what were some of the most significant events in the early days of cable television and what role did you play in them?

JARMAIN: That's a tough one.

EASTON: Obviously one of them was the formation of the CCTA to represent the industry as a whole.

JARMAIN: Well, I was a member of CCTA. As I recall, I think the first president was Fred Metcalf.

EASTON: Who played a large part in forming the association, anyway.

JARMAIN: Yes, that's right.

EASTON: And I think he was originally the first president, wasn't he?

JARMAIN: I think so. I think he was the first president.

EASTON: And were there any other significant events that you can think of in the early days of cable television? Developments, for example, which influenced the way it went either technically or in any other way?

JARMAIN: Getting attachment rights to the telephone poles was a very significant thing.

EASTON: Was the Association effective in that?

VAN DER LIN: I think, too, Ken, a very interesting evolution of the cable offering to subscribers when I came with Ed – we were running non-adjacent channels and we switched from three channels to six channels, and then we went from six channels to twelve channels.

EASTON: Would you like to explain what you mean by non-adjacent channels and why you couldn't operate adjacent channels?

VAN DER LIN: Well, because of the bandwidth of amplifiers were relatively narrow and if you could not run adjacent channels without one channel interfering with the other channel...

EASTON: You had to amplify it channel by channel.

HOOD: We didn't have processors, channel processors.

EASTON: But you didn't have wide-band amplifiers? You didn't have an amplifier which could take the whole band on the cable wire?

HOOD: The SKLs did that.

JARMAIN: The SKLs were the first ones.

HOOD: But there were systems that were built with strip amplifiers. In other words, there was an amplifier for every channel that you were delivering.

EASTON: And because of the limited bandwidth of the amplifiers, you had to limit them to one channel.

VAN DER LIN: That's correct. And also because of the noise factors in amplifiers, you could not cascade amplifiers for any great distances and therefore you had to convert high-band channels back down to low-band, and so you got a very limited capability, and Ed was one of the main drivers back then with Jerrold Corporation out of Philadelphia and pushed them very hard to get better broadband amplifiers and Ed, I think, was a real pioneer in analyzing all of the technical implications of going from a single channel amplifiers to broadband amplifiers.

EASTON: Ed, were all the channels you were receiving here in London originally low-band or were you receiving any high-band channels?

HOOD: No, we were receiving high-band. The Cleveland stations were all high-band channels and the Detroits were seven. Cleveland was channel 8.

VAN DER LIN: Erie was channel 12.

HOOD: But it was shortly after that Jerrold came out with the D-Mods, the TDs, in other words, which had a tube demodulator.

EASTON: That means that right from the start, and I mean THE start, Ed was carrying high-band channels on his cable?

HOOD: Yes.

EASTON: And yet there weren't any high-band amplifiers?

HOOD: No, we had to convert them.

EASTON: Oh, so he did have converters already?

HOOD: Yes, there were two converters that converted to feed the strips. The first channels were the TDs and the TMs, which were the tube modulators and the tube demods, and the other thing that the tube demod had that Jerrold built – and that was a unit about this big! I mean, one channel was processed in that much space, right?

VAN DER LIN: All with tubes.

HOOD: All with tubes. But the other thing is by going down to a base band video signal, they had the tuned 10 kilohertz, 20 kilohertz traps in there that we would tune, and the thing is that was a pretty much every morning every evening job because they would drift back and forth and you didn't know who was causing the co-channel, whether it was 10 kilohertz or 20 kilohertz and you had to tune the little traps.

EASTON: So at that point, which is what we're talking about, the high-band channels which were received were not converted direct to low-band but were taken down to video first and then modulated back up?

HOOD: That's right.

VAN DER LIN: Now the channel 2s or channel 4s we used the Jerrold strip amplifiers and they had a very high range of gain, or AGC, but you see, they didn't have a sound adjust on them so you couldn't adjust the sound carrier. So then we had to be careful where we put them because then you couldn't do the adjacent channel, whereas with a modulator you could control the sound carrier level and video and video modulation.

EASTON: So even in those very early days, very early days, it wasn't a simple technical operation.

HOOD: Probably more complex then it is today.

VAN DER LIN: I think that's right.

EASTON: It quite probably was.

HAMILTON-PIERCY: Certainly more labor intense, that's for sure.

EASTON: And done with far less technical knowledge and experience than we have today.

JARMAIN: We amassed our own knowledge and experience.

VAN DER LIN: The know-how base just simply wasn't there. There were no precedents and Ed became the know-how base.

EASTON: That's really the point I'm trying to get at. Ed, who literally started in the dry-cleaning business and I think I'm right in saying didn't have a technical education...

JARMAIN: Well, that's not quite true.

EASTON: In the sense that we know it now. You didn't go to university to get an engineering degree.

JARMAIN: I had an engineering degree.

EASTON: Oh, you did.

JARMAIN: Mechanical engineering.

EASTON: Oh, mechanical. You did have a technical degree but not in electrical engineering. You had to find your own way through these problems.

JARMAIN: The year I graduated in engineering was 1930 and in 1930 there wasn't any electronics around.

EASTON: No, but there was electrical engineering, as such.

JARMAIN: That's right but it was mainly hydro and to some extent the telephone companies.

EASTON: So most of the knowledge which you required in dealing with these problems we're talking about now about receiving high-band and converting to low-band and so forth, was all knowledge which really you acquired and in some ways started to build a basis for that knowledge in the cable industry.

JARMAIN: Well, I guess we led the way.

EASTON: That's what I mean, yes, yes.

VAN DER LIN: When I came here, Ed handed me over a whole set of manuals on how to do the maintenance on equipment that he had acquired because he had a unique application, so Ed would write his own manuals and he would show you the wave response and the side-band response and how to adjust the traps. Ed had his own manuals. They were hand-written manuals.

EASTON: This is very interesting, particularly because so many people who have a peripheral knowledge about cable television and very little knowledge about the technical basis believe, quite sincerely, that all the technical basis for cable television has been derived from and started by the manufacturers, people who were making the amplifiers, but that's not right.

HOOD: I can add to this, too, and that is when we had to extend our amplifier cascades, we got into a situation where Ed selected an amplifier that was called an LSA 795 that was from Jerrold, but I believe that was developed by Western Electric for telephone and it was a 5-95 megahertz bandwidth amplifier.

EASTON: Jerrold being the American company who were involved in the production of some of the earlier equipment used in the systems in Pennsylvania. In fact they were based in Pennsylvania.

HOOD: That's right. But this amplifier was developed as a telephone amplifier and for long-haul, and that's the problem that Ed had here. He was building a system for a large city and when you add up the miles of plant and we only had RG11, the cable wasn't suitable, and the cable that was selected for the trunks at that time was PD375, which was an air to electric cable and here again was developed by Western Electric and sold in Canada at that time by a company called Northern Electric, which belonged to Bell. However, it didn't matter what we did, whether it was splicing or making splices for that cable or whatever, we had to develop that. Everything had to be developed and built up.

EASTON: But Ed, in the very early days when you were serving subscribers who were your neighbors, what kind of cable were you using?

JARMAIN: It was RG11U.

EASTON: That being a braided coaxial cable?

JARMAIN: Yeah.

HOOD: Polyethylene dielectric, yes.

EASTON: Was it a commercial cable or was it a military...?

JARMAIN: Military. Actually it was a military spec.

HOOD: And the connecters were Type Ns. 75 ohm Type Ns. Back in those days they were hard to come by.

VAN DER LIN: The whole connecter issues, cable issues, splicing issues, amplifier issues – Ed even had Jerrold develop a low-band to high-band converter called a CDX 713, which would convert low-band channels to high-band at distribution points.

HAMILTON-PIERCY: Every bridger point you had to have one of these amplifiers and converters.

EASTON: It took care of your immediate requirements here in London.

VAN DER LIN: This was the largest system in North America.

HOOD: Ed had to go from 5 channels to 12 channels, right? We had more channels. Now we had Cleveland coming in and we had Kitchener and we had London and whatnot, and so we, as Ed's design with guys like Ken Simons and Frank Ragone down there...

EASTON: They're all Jerrold people.

HOOD: Jerrold people – and Ed came up with let's use the sub-low, which was the 5 to 40 megahertz at that time and so that's the way we went and let me tell you, there were a lot of pains and experiences because that's where we were using the T-channels at that time. They were called T-channels and I think they still are today, T7 to T13. T7 was 7 megahertz and T13 was 40 megahertz, but then we transported them down through the trunk because the trunk was built in 95 megahertz and that kept the cascade. The longest cascade was something like 30 amplifiers in London, so if you were at the small cable and VHF you would have been 50-60 amplifiers in cascade. Well, Ed would sit there and calculate – "This is not going to work. This is not the way we're going, and we're going sub-low."

HAMILTON-PIERCY: Were you in 50-60,000 homes, then, were you?

HOOD: That's right.

EASTON: In talking about these details, you were really now going beyond the initial stage where Ed started. What sort of date are you talking about there? At what point did you reach that stage that you were beginning to serve a larger area of the city?

HOOD: The '60s. In the '60s you had the 5 channels throughout the major core. North London, you would have done North London then, and we had North London and South London and that was the 5 channels which was the LSA 795 and the 410 was the AGC because the 795 didn't have AGC.

EASTON: By that time, there was a local transmitter here in London. What was the influence of that on your system?

JARMAIN: Well, it obviously retarded our development because I purposely held back on expansion when we knew there was a local system coming in because I felt that when people were buying TV sets and paying on time payments they wouldn't have that extra $4 a month that we wanted, so we took it very slowly.

EASTON: But obviously quite early on, even after the local station was established and in business and people began to get used to getting local television, locally produced television, would I be correct in assuming that there was a growing feeling that they needed more than just one channel, they needed more variety?

JARMAIN: There was always that feeling.

EASTON: And how much influence did that have on the development of your cable business?

JARMAIN: Oh, I think it had a big influence on it, don't you?

HOOD: The main influence.

VAN DER LIN: The key was to be able to offer not only a Canadian network, but also the three main U.S. networks at that time, ABC, CBS and NBC.

EASTON: Which is what people really wanted to watch.

JARMAIN: That's what everybody wanted was the U.S. network.

HOOD: You really had more to offer here than an American could receive in the U.S. because he only got his American networks. Here we had the Canadian networks, eventually CTV and CBC and the American networks.

EASTON: We're talking here about 1954.

HOOD: Yeah, we didn't have CTV. When did Kitchener come on?

EASTON: Because your local station here didn't open until sometime in '54, was it?

JARMAIN: I don't know, it might have been '53, Ken.

EASTON: It was in the early days, anyway.

VAN DER LIN: I think CFPL-TV started in 1952.

EASTON: '52. It started after Ed actually started his cable system because Ed started his cable system, as I understand, on the Cleveland stations. You didn't have a local station.

HOOD: No, I don't think they were here yet.

VAN DER LIN: No, they were not here yet. Maybe it was '53.

HOOD: A little later, yes.

EASTON: A general question, Ed. In your opinion, what was one of the most significant events in the early days of cable television and what role did you play in them? It's a broad question but it's open to interpretation any way you like.

JARMAIN: I think my colleagues here would be better able to comment on that than I would. I was pretty close to the forest, a little too close to see the trees.

HAMILTON-PIERCY: Well, how about the challenge of getting financing? Was there anything special there?

JARMAIN: Oh, definitely.

EASTON: In the early days that was probably the biggest challenge, wasn't it?

JARMAIN: That was the biggest challenge, definitely.

EASTON: And indeed, was that not one of the reasons, if not the main reason why you had to charge a connection fee? You had to get your financing up front because you couldn't...

JARMAIN: It was very, very early days and for a limited period of time that was true, Ken, but I think that our connection with Famous Players developed pretty early on in the game and of course that changed the whole ballgame.

EASTON: You refer to a connection with Famous Players. How did that develop?

JARMAIN: Well, it developed very simply. They heard about what I was doing here and they decided that they would like to be partners in it.

EASTON: That is expansion of Famous Players to London?

JARMAIN: Exactly, and they came on and made me the generous offer that I would retire to a 10% holding in the company and they would take the ball and run with it.

EASTON: They were going to finance your expansion?

JARMAIN: I said, "Well, how about 50%?" and they ultimately agreed. So we were equal partners and I've heard people say that the 50/50 partnerships don't work but Famous Players was different. They were marvelous partners. I can't say enough good about them.

EASTON: That partnership primarily involved the financing. Did it involve anything else?

JARMAIN: No, that's all I needed from them. They didn't have any know-how. Nobody else did, for that matter.

VAN DER LIN: I think I remember once in a while Ru Goldberg would come in from Toronto and come and visit and review the business with Ed, and there was a tremendous amount of respect for Ed and the Famous Players people couldn't have found a better partner, in my judgment, because Ed's seeking for excellence in his business, not only technical excellence but also the quality of the business that he ran was just really exceptional, and I think Famous Players and Mr. Goldberg in particular really recognized that he was working with a very talented person and really a committed person who had a lot of vision about the cable television business because Ed truly was the pioneer in Canada and was exceptional in terms of delivering a quality product to his customers, and I think all the technical innovation that took place back then became a tremendous credit to the industry. I think the cable industry flourished because of people like Ed Jarmain.

EASTON: So basically the attraction of Famous Players for you was really that they were able to provide you with the financing which you badly needed and couldn't get from other sources.

JARMAIN: Exactly. I remember the first expansion that I wanted to do they wanted about $425,000, I think it was, and I went in to the CIBC, it was called the Imperial Bank of Canada in those days, and put this proposition to them and fortunately I had taken Ru Balsted with me.

EASTON: He was the president of Famous Players.

JARMAIN: He was the president of Famous Players. So of course the first thing the banker said was "You want $425,000 on what security?" And Ru Balsted chirps in, "None. Not any." I'll always remember that.

EASTON: Wasn't his presence as a representative of Famous Players adequate security for the bank?

JARMAIN: Sure, but the banker simply said when he said that, "I don't know whether this has got a chance of flying or not, but I'll submit it to the head office anyway. Couldn't you bring it down below $400,000?" and I said, "Why?" He said, "That's the breaking point where we have to board it," in other words, the loan has to be approved by the board of directors of the bank, and I said, "No, I can't cut it down. That's exactly what I want. I want to get to know the board of directors of the bank."

EASTON: He considered Famous Players to be adequate insurance for him.

JARMAIN: Yes. It gave it respectability, Ken.

EASTON: Famous Players was an established Canadian company, even though it was American owned, and it was quoted on the Canadian stock exchange and had been for years.

JARMAIN: Many years. They controlled 350-400 motion picture outlets in Canada.

EASTON: They weren't themselves in cable at that time, were they? You were their first entry to cable. Tell me, Ed, what is your favorite memory from your long career in the cable television business? Do you have a favorite memory?

JARMAIN: My favorite memory I just told you about – sitting in the banker's office and asking for $425,000 because after all, the loan was approved.

HAMILTON-PIERCY: Ed, one thing you always told us when we joined you in the company is that profits will arrive if you take care of your customer, the customer will take care of you and that's how profits will arrive. You always used to preach that.

JARMAIN: Exactly. And I still believe that.

EASTON: Now, Ed, and Nick has just mentioned about your people – who were some of the people who influenced you during your career and tell us a little bit about them. For example, why don't you say a few words about each of the people here in the outfield.

JARMAIN: Well, the first thing that comes to my mind is that no matter what the crisis was, if the system went off and it was a snowstorm in the middle of January and in the middle of the night, these guys were always on the job. They were certainly imbued with the belief that the show must go on. They were people that I could always count on. I was exceptionally lucky, I think, in the people who came to work for me in that they were all of that caliber – loyal, dedicated, and I'm sure that that was in large measure the reason for my success.

EASTON: Were there other people in the cable industry at large, other than your employees, who influenced you? There must have been others. You mentioned Fred Metcalf, for example. Did he have an influence on the way your business developed?

JARMAIN: Well, I always thought of Fred as a follower, not a leader, although Fred certainly made an important contribution to the cable business.

EASTON: I use the term influence – people who might have influenced your thinking or what you did.

JARMAIN: It's a little hard to say because various things and people affect your thinking as you develop a business and to what extent each influence was highly significant is difficult to recall.

EASTON: Famous Players eventually got involved with Rogers Communications. What influenced you to sell your company to Rogers?

JARMAIN: I think we were faced with the prospects of a takeover.

EASTON: By?

JARMAIN: By Rogers.

EASTON: At that point, Rogers had in effect taken over Famous Players, in effect.

JARMAIN: Yes, that's probably true. My thinking is a little hazy there.

VAN DER LIN: Ken, maybe I can add something there and that is of course what happened is that Famous Players had a group of systems – Toronto, Kitchener, Hamilton – and the Jarmain group of companies was more in southwestern Ontario and then the Famous Players group got together with the Jarmain group and formed a company called Canadian Cable Systems, and that became a public company where the Jarmains owned a piece of the action and of course so did Famous Players, right Ed?

JARMAIN: A major piece.

VAN DER LIN: That became Canadian Cable Systems and that's when the Rogers group came in and took control of Canadian Cable Systems.

EASTON: I see, so Rogers didn't literally take control of Ed's system here. They really took control of Canadian Cable Systems, which by that time included Ed's operation here in London.

HOOD: Exactly. So Ed was at that time, the time prior, was still a privately held company so they were not able to take that over. It was not until that became a public vehicle that Ted Rogers managed to buy control of that company.

EASTON: So now your operation here in London is part of the Rogers Communications Group, is it?

JARMAIN: Oh, yeah. It's owned by Rogers outright.

EASTON: It is a Rogers' operation.

JARMAIN: A Rogers operation, yeah.

EASTON: Well, Ed, your role in the development of cable television in Canada is monumental. I'd like to thank you on behalf of The Cable Center for your time today. This has been an oral history of Ed Jarmain and was recorded as part of the Oral and Video History Program of The Cable Center. Your interviewer was Ken Easton. Thank you very much, Ed.

JARMAIN: Thank you.

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Robert James

Robert James

Interview Date: Sunday February 11, 2001
Interview Location: Sun Valley, ID
Interviewer: Jim Keller
Program: Hauser Project

Start of Tape 1, Side A

KELLER: This is the oral history of Robert L. James, partner in the Washington, DC communications law firm of Cole, Raywid & Braverman. Bob is also a cable pioneer and has represented many, many of the cable companies here in the northwest, as well as throughout the country. We are currently at the Sun Valley Lodge in Sun Valley, Idaho at the annual meeting of the Sawtooth Cable Television Professionals. The date is February 11, 2001. Your interviewer is Jim Keller.

This oral history is brought to you through a donation of the Gustav Hauser Foundation as part of the Oral History Program of the National Cable Television Center and Museum.

Bob, as we get started, tell us a little bit about your educational background, where you grew up, and what you did before you got into the law firm of Cole, Raywid & Braverman.

JAMES: Well, I grew up moving around a great deal. I finally went to high school in Washington, DC, went away to college to Cornell University in New York State, but back to Washington for law school. I went to George Washington Law School and graduated in 1969. Prior to graduating, I started working at the firm and have been there ever since.

KELLER: You were very fortunate in getting involved with Jack Cole. He's been a real pioneer in this business.

JAMES: I absolutely agree. It's been a pleasure and a real privilege to ...

KELLER: Can you tell us some of the clients you represent?

JAMES: In the early days, we represented TelePrompter and ATC even at one, and a lot of the companies off and on, and many smaller operators, many mid-sized operators and many larger operators. Now there are just fewer smaller and mid-sized operators, but we now represent AT&T, Charter, MediaOne – now part of AT&T.

KELLER: Charter is Paul Allen's firm, is that right?

JAMES: Yes. We do work for most of the MSOs – Comcast, Adelphia, and a lot of smaller cable operators.

KELLER: As you were part of the panel discussion this morning with the smaller operators who were there at that time.

JAMES: Yes. Most of them have been clients before they got out of the business.

KELLER: Bob, let's begin by talking about _____.

JAMES: It really started in the 1960s in a very restrictive way. The FCC decided that they had to freeze cable operators bringing in distant signals into local television markets, and it was done really to protect the broadcasters, as you know, and particularly the smaller broadcasters. The FCC had made it its mission to really protect them economically from what they saw as competition. So the initial freeze went in in the late 60s and it just virtually stopped the growth of cable television particularly in the larger cities where some systems had already started up. They then suddenly had nothing to sell to the consumers other than an improved signal which in a few areas was still effective. Gradually, the FCC adopted a set of rules that would permit cable to carry certain, very limited numbers of signals. That was in place for a long time from about 1972. They restricted carriage of these distant signals which was the real reason the consumers were buying cable in areas where they could get reception. Cable had developed obviously in places where it was needed for basic reception of television. The FCC restrictions stayed on until the early 1980s, and at that point, the FCC finally gave up on restricting distant signals but engaged in lots of other regulation of cable television.

KELLER: That's when the copyright came in though, didn't it?

JAMES: And copyright law was passed in 1976, and that really effectively established a regime, a copyright royalty tribunal, that limited importation of distant signals by pricing. So even though the FCC had rescinded its distant signal restrictions, the copyright tribunal pricing scheme, under the copyright law, prevented cable operators from carrying great many distant signals. So it really perpetuated the FCC rules that were in effect in 1976 right to the present day.

KELLER: As I remember, there was a basic fee of 3.75% or whatever it was, for a certain package of signals that you could carry. If you went over that, you had to pay more.

JAMES: It was very complicated formulas and meant a lot of work for all the lawyers because there was a lot of uncertainty and a lot of controversy over how to interpret the law. But basically the fees were fairly reasonable as long as you limited your signal carriage to television stations that were permitted under the FCC's restrictive rules from 1976. If you carried any signals above those quotas, that's when the 3.75% penalty fee went into effect. That was 3.75% of your gross revenues from any tier of service that had broadcast signals on it. This was really prohibitive, and very few cable operators were willing to pay that.

KELLER: So you're saying that you could carry a certain number of signals without paying copyright. But if you carried any more than that, you triggered the 3.75%? Is that it?

JAMES: Well, you'd pay a reasonable copyright. Everyone paid some copyright. But you paid a few that was fairly reasonable until you went over those quotas. Then you got into the 3.75.

KELLER: That's where the 3.75 came in.

JAMES: Right. And that was really so restrictive that it really perpetuated those old FCC rules that the FCC itself had decided were not in the public interest.

KELLER: Who oversees the copyright tribunal?

JAMES: The U.S. Copyright Office is the agency of the federal government that collects the money and distributes it, and interprets the rules. The tribunal was set up by Congress in the law, and there really isn't a lot of oversight. It's an independent agency and has very limited use right now because most of the time the copyright fees are, under the law, evaluated every five years, I think. At the time, they had a tremendous power when they made their first decisions because that's when they were setting these rates. Since then, their role has been fairly limited as far as cable's concerned.

KELLER: But almost the impact of all of those rules and regulations kind of went away with the advent of the satellite-distributed signals, is that right?

JAMES: Absolutely. So what happened was the satellite distribution came in and suddenly all the other programming sources were available and that replaced the need for distant signals because cable then had a great deal more product to sell in these major markets where they could really develop huge, huge systems and revenues from that.

KELLER: How about mandatory carriage of local signals. What was your reaction to that and how did that affect the industry?

JAMES: I would say it's often been a thorn in the industry's side because cable operators generally wanted to carry the local signals that the customers wanted. But it permitted broadcasters to build stations that were not in - really broadcast stations – they weren't built to really reach the public over the air as much as to get on the cable system. So they'd be low budget stations with very poor programming. It was those kinds of stations that the cable operators did not want to have to carry and use up their scarce channel capacity. So I'd say it's definitely been a thorn in the cable operator's side, but I don't think it retarded the growth of cable or the way the restrictions on signal carriage did.

KELLER: I think it was the '92 Act when the implied consent requirement was placed over the broadcast stations and everybody was very, very much concerned about that – that all of a sudden all of the broadcast stations would require consent and would require payment. But it never affected us.

JAMES: It still concerns me.

KELLER: Okay, Go ahead.

JAMES: It was in the 1992 Cable Act. It said that no cable operator could carry a broadcast signal without the consent of the broadcaster. What that meant was the local ABC, NCB, whatever, could withhold its product from the cable systems. It particularly had potential to damage, and still does, to damage the smaller cable operator because a local broadcaster is not going to withhold his product a system that's serving most of his market. But if it's a small system, it's serving only a small area that really isn't going to impact the broadcaster's audience numbers. They may just decide they're going to hold him up for a lot of money.

KELLER: Have there ever been any major payments to broadcasters?

JAMES: Oh, yes. It's often not been in terms of money. There have been some ...

KELLER: Trade-outs, right?

JAMES: But huge trade-outs where – and it's still going on now even with ABC and the recent ...

KELLER: It applied to the network carriage too, didn't it, not just the local station programming?

JAMES: Oh, yes. Absolutely. ABC and NBC, for example, were able to force the cable operators that if they wanted to carry the local NBC affiliate, the cable operator also had to carry CNBC and other cable programming services that the ...

KELLER: I had forgotten that. That is the law.

JAMES: Yes. So it was a big tie-in. It was used, and still is being used, by the broadcasters, particularly the larger ones.

KELLER: Is ABC using it today to require their ...?

JAMES: Oh, yes. And there have been very recent disputes with a number of the large cable operators over carrying, for example, different types of ABC's affiliated cable programming, whether it's ESPN2, the Disney products, and so forth.

KELLER: Have some ever been taken to court and adjudicated?

JAMES: It really has not because the law was passed as a political gift to the broadcast industry to say, "Well, okay, we'll give you this right to collect money by cable operator's carrying your signal in the market that you're broadcasting over the air to." So it's never really been challenged in court as far as these tie-ins. There have been court cases, but it's usually been settled.

KELLER: Oh, there have been court cases?

JAMES: Yes, I think there were some court cases when they were fight over whether they had to take a signal off. I know there were cases at the FCC, but I don't even know that there were any decisions that came out of the cases. There was a lot of legal wrangling.

KELLER: When you say, "Today it still concerns you," you were talking primarily about the small operators in distant markets from the major cities?

JAMES: Somewhat. But I still think there's a lot of potential because the retransmission consent periods run every three years, and broadcasters can agree to make it a longer period than that. But most of them are running about every three years. So every three years, they have the opportunity to go to the cable operator and say, "Okay, I want payment for this." And the cable operator is already being squeezed by different programming prices, so it's a real potential problem.

KELLER: Do you represent any of the programming services?

JAMES: We do represent some of the programmers – Outdoor Life and some of the cable programming networks.

KELLER: At one time, especially during the freeze of cable television application .... Before, let's go back to this. The FCC used their authority over the granting of microwave licenses to take their first attempt at regulating the cable industry, even after they had said that they had no jurisdiction. Is that correct?

JAMES: Right. In the Carter Mountain case and some of these early decisions the court basically said that the cable operator was operating an antenna service and did not owe copyright and therefore should be allowed to do it. But the FCC was very restrictive in granting microwave licenses - initially, initially – to cable. That was another way that they wanted to restrict the distant signals coming in. But they did grant licenses eventually.

KELLER: Common carrier first which meant they had to serve some outside customers to start with, right?

JAMES: Absolutely. They had to have 50% of the customers had to be ... And that was not initially. Initially you could be a common carrier and you didn't have to serve 50%. But they passed a rule saying, "Half your customers had to be unaffiliated with the carrier."

KELLER: What gave them the impetus, then, to pass the CARS regulation – Cable Antenna Relay Services – that was microwave to specific systems owned by the cable operator?

JAMES: Mainly the common carrier frequencies were particularly good, and they were lower frequencies, and there was a real demand for them. It was the idea that they would give cable something but it wouldn't be that good. So they all knew cable microwave systems had to be done in the CARS band, which is 11 – 12 Ghz and higher as opposed to the common carrier bands in 4 – 6 GHz.

KELLER: I don't remember, but did they continue to allow cable systems to be served by common carrier microwave services?

JAMES: Yes. And there's still some out there today, not many, but some.

KELLER: It's like the networks carrying their programs across the country, microwaving it. I don't think they do that anymore. It's just a prohibitively expensive thing.

JAMES: These companies have to renew their, the common carrier companies, have to renew their licenses every ten years. A couple of weeks ago they had to file for the renewals. There were still some small companies out there that had to file.

KELLER: MCI originally was built on the basis of microwave distribution of all kinds of signals, especially phone service.

JAMES: Oh, yes. They built it. They built so much terrestrial microwave.

KELLER: It's a shame that so much of that is being wasted. But I guess the railroads and other people are using it today, aren't they?

JAMES: I'm not sure how much. I know a lot of that is still in use, and I'm not sure how much of it is being done on terrestrial microwave still. I know so much has witched to satellite or fiber-optic lines.

KELLER: Where did they make the great jump between regulating only microwave-served systems to regulating all of cable television systems?

JAMES: I'm trying to think back to that because that has been so long ago that I've come to accept their jurisdiction. They had decided that in the Southwestern Case, their jurisdiction over cable television was ancillary to their jurisdiction over broadcast.

KELLER: That was San Diego Southwestern Case, is that correct, where they were importing signals from Los Angeles into the market?

JAMES: Right. And the FCC asserted jurisdiction and the Supreme Court upheld the jurisdiction as ancillary to the FCC's regulation of broadcasting.

KELLER: But the systems in San Diego were not using microwave to pick up the Los Angeles signals, were they?

JAMES: I doubt that they were, but I don't know. I don't recall.

KELLER: Do you think that was the first step where they went from just regulating microwave-served systems to regulating all of the cable operations?

JAMES: I'm not sure. I'm really not sure about that. I think that may have been, but I'm not positive that that was. I know they got away from using microwave or being restrictive with the microwave licenses, and they just asserted jurisdiction directly over cable.

KELLER: Was that in the First Report and Order?

JAMES: The First Report and Order was their first... well, they had a lot of different initial decisions and preliminary reports, but the First Report and Order ... And there were a number of First Report and Orders in different proceedings. But really it was in 1972 that they really became very active in asserting and regulating cable. Prior to that, they asserted jurisdiction through the freeze which was really through the late 60s. But there, at that point, they froze the distant signal market, preventing cable operators from carrying any distant signals until the FCC could figure out what they were going to permit.

KELLER: Only in the top 100 markets, though – is that correct?

JAMES: Yes. Right.

KELLER: You could carry anything at that point, even leap-frogging in smaller markets.

JAMES: Yes. If you were outside the zones of the markets. And those zones kept changing with the different sets of rules.

KELLER: Define leap-frogging.

JAMES: Leap-frogging was a concept that if you wanted to carry, for example, an NBC station, you had to carry the closest one. You couldn't carry one from perhaps a larger city (that your residents, your subscribers, would have a greater interest in) if it was farther away. You had to carry the closest signal of that type. You couldn't leap-frog the more distant signal over the closer one – another protection ...

KELLER: ...of the broadcasters.

JAMES: Absolutely.

KELLER: Why do you think that there was such a demand on the commission and at the commission level to protect broadcasters?

JAMES: Number one, I think it was political. I also think that there were a number of people who genuinely felt that they had a duty and a public interest obligation to protect the broadcasters. I don't think it was all a sinister thing. I think there are some people that actually believe that cable would hurt the smaller broadcasters. But it was largely political. It was the broadcast interests used the smaller broadcaster as an example of someone who would be hurt if cable developed in these various markets.

KELLER: Carter Mountain was a perfect example of that.

JAMES: Yes.

KELLER: ...and Worland, Wyoming.

JAMES: ...and picking a tiny little broadcaster to make an example of. Many of those broadcasters were marginal. The markets were so small they couldn't really support a television station. So it really never was adequately proven that cable was a real threat, even to the smaller broadcasters. In many cases they helped the smaller broadcaster by carrying them and providing a good signal from a station that was not well-built or well-financed.

KELLER: Remember when we were very much concerned about translators and repeaters?

JAMES: Oh, yes.

KELLER: Do you want to explain a little bit about that and what they were? It's almost something in the very distant past that doesn't make any difference anymore, but it did at the time.

JAMES: When I first came to the law firm in 1969 and in the early 70s, the broadcasters in Albuquerque, New Mexico, for example, would build translator stations at the limits of the broadcast signal to extend that signal. And they still do, and they still use those translators.

KELLER: Especially in mountainous areas.

JAMES: Yes. And some cities actually, rural cities, built translators to bring signals in over the air to local residents. All they did was pick up the signal off the air, off a high tower, and rebroadcast the signal on a different frequency into the town. So they might be broadcasting on Channel 6, translator would pick up that signal and rebroadcast it – extent the range of it – on a different channel, Channel 32 or whatever.

KELLER: The advent of UHF allocations came during the freeze. Was there some idea in the mind of the commission that once there were these UHF stations assigned to virtually every market in the country, large or small, that there would no longer be any need for cable?

JAMES: Yes. I don't know... It may have been, may well have been. I don't know if most of the FCC got to that conclusion, but that certainly was their idea – that they would encourage the development of UHF stations everywhere and it was better to have this so-called free over-the-air television supported by advertising than it was to have a subscription service that people would actually pay for.

KELLER: It never worked.

JAMES: It never did. But I do think, in the end, that the cable industry helped even the smaller broadcasters. There may have been isolated cases where there was a competitive impact. But there were a lot of cases where the cable operator really helped the smaller UHF stations.

KELLER: I don't think there's any question about it. In San Francisco, there were a couple of new UHF stations that went on the air. Their signal couldn't really reach all over San Francisco by coming off the air from wherever their antenna was located or transmitter was located. They came to us and asked for a direct studio-to-headend feed. It was the first time that I remember that occurring. It was a great benefit to that station. We had a clear signal all the way through.

JAMES: So then they were getting a good signal into the home in just a different way.

KELLER: I've often thought that perhaps the broadcasters never realized just exactly what business they were in. I'm convinced that they thought they were in the transmission business as opposed to the programming business. I also thought the same thing about newspapers - they were in the distribution system rather than the news gathering system. We just provided a new way for them to distribute their signal, and they didn't have to pay you.

JAMES: Yes. There's a lot of truth to that too.

KELLER: Some of the broadcasters will deny that vehemently. As a matter of fact, our friend Ed Hewson of King Broadcasting, denies that that was ever even thought of them – of them at least. But they were one of the better broadcasters throughout the country.

Let's make a little segue here, Bob, and go into the First Amendment rights for cable television. Go back to the fact that there was a time when the industry said that they were just an antenna service and therefore didn't have any First Amendment rights at all. Then how did that change over the years? How did it change and what was the impetus for the change?

JAMES: I think some of it was tied in to the federal regulation and also into the copyright issues. With the passage of the copyright law, cable paying copyright. The argument was that the cable operator was, in effect, like a newspaper. It was publishing information and distributing it to the home and the government shouldn't be regulating a newspaper or the cable system. Through a series of court cases, the courts did support First Amendment rights for cable at some times more than others, some times more restrictive than others. But it was used to challenge many things that the regulators had done, particularly the distant signal restrictions. The whole idea that the government could tell people what they could publish on this electronic medium and what the viewers, the cable customers, could see in their homes, was being controlled by the government. There were a number of cases, back and forth, on the First Amendment protection of cable operators that we strongly felt that the government should not be in that kind of regulation.

KELLER: It seems like they applied the First Amendment rights in some cases and in some cases not. For example, newspapers obviously have First Amendment rights -–free speech. They can put their newspaper stands on any street corner and are not required to pay for that location to the city at all. Yet we, who are First Amendment speakers, have to pay the city for the right to use the public rights of way. What is the rationale behind that?

JAMES: It's one of many things that have just grown up historically.

KELLER: The question, Bob, was that there are certain limitations to the cable's First Amendment rights. I used the example of the newspaper who are First Amendment speakers who have the right to, under the First Amendment, put their kiosks or distribution boxes on any street corner, tie them to telephone poles, or light poles, or whatever it may be, without any... In fact, they've been told they didn't have to pay anything by the courts because of the First Amendment rights. Yet we have to pay for the right to use the public rights of way. Is that a dichotomy?

JAMES: Yes. It's just grown up historically that way, and because there were different political interests and financial interests at stake, is a lot of the reason for it. The most recent First Amendment cases have limited cable's First Amendment rights in some circumstances.

KELLER: What would those be?

JAMES: For example, talking about the public rights of way – the cities have, under their police power, they have the power to regulate the rights of way for safety and other types of police powers. So you have these different rights all kind of coming together. I think there's probably more challenges to be made by the cable operators in the First Amendment area. The First Amendment really has been helpful to the industry, but it didn't solve all of the problems. But it really has been a very helpful tool in limiting the kind of government regulation that would just be completely impermissible to regulate a newspaper the way they've regulated cable. So much of this has grown up historically.

KELLER: My thought would be just the reverse. Why should they regulate cable when they didn't regulate newspapers?

JAMES: Well, the point is that they shouldn't. That's been our position all along. But there have always been arguments to balance the public interest. Was, for example, protecting the broadcaster, was that the kind of limitation that the government could have on the First Amendment right because it had a duty to protect these broadcasters and extend the broadcast industry and coverage. So was there a governmental right that allowed it to, therefore, restrict cable's First Amendment rights? There's always this balancing. By developing the law through a series of cases, you come up with some very strange results.

KELLER: I'm surprised you didn't put public interest in quotes.

JAMES: Everyone argues about the public interest. It's amazing.

KELLER: They're thwarting it.

JAMES: Yes, absolutely.

KELLER: When did the requirements for the cable systems to carry public educational and governmental access channels come in and what was the result of that?

JAMES: A lot of that came in the franchising. The FCC originally had some rules that impacted it somewhat. But mostly, this was done at the local level. It was done in the cable franchising process as part of the cities' effort to have a government channel and an educational channel and a public access channel. It was encouraged by the FCC.

KELLER: Wasn't that codified though?

JAMES: I don't know that it was ever a requirement in any of the cable statutes that you had to have particular access channels. I'm not sure – I may be wrong about that – but I don't think it was. I think it was done by the cities. They did it and the laws supported the cities' doing it because they clearly required the cable operator to carry those channels on basic service and things like that.

KELLER: Wasn't there a court case saying that it infringed the First Amendment rights to require the cable operators to provide those kinds of channels?

JAMES: I don't recall. I just don't recall if that issue got into the courts or not.

KELLER: I thought they did away with the requirement, but again I don't remember that clearly either.

JAMES: That may be one of those many things that has drifted along ...

KELLER: That's probably true.

JAMES: ...from my memory.

KELLER: Do you think that even after the passage of the '94 Cable Act, that there's going to be additional regulations to protect the broadcasters?

JAMES: Well, there are disputes going on right now at the FCC on what the cable operator would be required to carry when the broadcaster is transmitting more than one signal. In other words, the broadcasters, as you know, have gotten a great deal of additional spectrum, and they could simultaneously transmit several channels. Will the cable operator be required to carry all of these digital channels? So we're back to the same argument about the broadcaster right now is a very active ... If fact, the FCC just issued a decision about two weeks ago, tentatively concluding that you would not have to, the cable operator would not have to carry these ancillary channels that the broadcasters have. But they're still a very effective and potent lobby, so I think they'll still receive some protection - as much as the agency can give them. But I think cable, now, has really surpassed a lot of its .... It's become an economic and political force in itself. I don't think we'll ever see it like we did where the government tries to stop the industry in its tracks – that's really what had happened.

KELLER: Politicians have to get heir message out. There was a time there when one of the better ways of getting the message out was through television broadcasting.

JAMES: Absolutely.

KELLER: That's where they got their power. Now that that's been so diversified through the cable channels, I don't think anymore, really that that's the only voice that politicians have.

JAMES: You're right about that. They still have a very strong political presence, though, because they still are ... As a politician, getting on favorable terms from the broadcaster, good times, and so forth, to be on is still a very important constituent for you to have.

KELLER: You're attuned to the scene in Washington, to a large extent. What kind of impact do you think that C-SPAN has made on the political process in this country?

JAMES: I think it's been phenomenal. I know people that just sit and watch C-SPAN. They have C-SPAN going in their house all day. But it really has, I think, opened up the political process in Washington to the country and forced it to reform itself in some ways, limited ways, because some of the practices and things that were happening, were just wouldn't look good if it was coming into your home. So I think it's had a tremendous impact. I think the Congressmen and Senators use C-SPAN also to get their message out, to get themselves on television, even if it's talking to a completely empty chamber. They're up there talking because this is getting recorded for their district.

KELLER: As you probably know, if you use politics and C-SPAN in the same sentence, the president of C-SPAN, Brian Lamb, has a fit because he felt there was no political benefit to C-SPAN at all. Rather, it was not the purpose of C-SPAN to be politically effective.

JAMES: I think that's true. He has been such a great leader. It's such a hard job to make C-SPAN non-political.

KELLER: Apolitical, probably.

JAMES: Yes, strictly apolitical. By doing that, he's made it a success because otherwise, it would become a political football and would have been, at some point, damaged and not been able to cover the House and Senate like they do. He has done a fabulous job of keeping it absolutely neutral.

KELLER: He sure has, and I'm amazed by the fact that he was able to do it.

JAMES: And that he had the foresight to realize that that's how he had to make this a lasting institution. But I think it's really opened up the political process to the country, to the scrutiny of the country. And that's healthy.

KELLER: What are the major concerns of your clients today?

JAMES: There are a lot of concerns. I think a lot of them are economic and rebuilding their systems and getting the internet services up and going. The kind of things that I see an awful lot of are local franchising issues where the cities need money and they're looking to businesses in their town that can somehow benefit the cities and provide funding to the cities. They don't want to raise taxes so they look to other sources of revenue.

KELLER: Especially in California.

JAMES: California is notorious. I spend a good bit of my time dealing with issues dealing with cable franchising where cities are looking to get basically a piece of the business.

KELLER: That's nothing new.

JAMES: It is nothing new.

KELLER: There were franchise requirements 20 years ago. If you would accept them at the time that the franchise ran out, you had to sell it back to the city at the depreciated value which was zip.

JAMES: Yes, yes. But now there's a much... The consultants to the cities have developed to be a very well-informed, well-funded group that advocates the financial interests of the cities as well as other interests. They address issues that are certainly proper for the cities to address. I think if the cities want to use cable as a revenue source, they really ought to do it openly and let the residents know what they're doing, that they're imposing a tax on cable - on cable subscribers.

KELLER: It was the '92 Act that permitted the cable television to itemize the various taxes and other fees that were charged on their subscribers bills, because there was a time that was prohibited.

JAMES: Right. I'm upset every time I pay my cable bill and I see how big that chunk is.

KELLER: Same thing with my telephone bill – the same way.

JAMES: I can't even understand my telephone bill.

KELLER: I can't either. I'm with you. I call them and ask them and they give me some explanation which I don't understand either. It's getting to be the same way with cable television. It's just a hidden tax.

JAMES: Yes. And I think the idea of putting a line item showing these taxes is something that really needed to be there.

KELLER: I can remember when cities prohibited showing those line items.

JAMES: And cities still will ask the cable operator not to show this as a line item. An individual mayors or city council people may do that. This is not true of all cities. There are a lot of cities that are out there that are doing the minimum amount of regulation they need to regulate the public rights of way, are not looking to cable to raise revenue for the city beyond funding the city's regulation of the wires. There are a lot of cities, in my view, regulating cable in a very proper way. But there are a lot of others that are just... They're strapped for money so that's what ....

KELLER: What are some of the very onerous provisions of these franchises that you currently object to, and what do we do about them?

JAMES: Well, there are so many. That's the problem right now. Some of them are outright just payments of money to the city. If, for example, the cable system is sold within a certain period of time, some franchise provisions say that the city will receive a set amount of money, $250,000 is one example that I'm thinking of. Many other requirements that, for studios and facilities that, for local production, government channels, many of the cities want the cable operator to build the city's own communication network so they can save money on their telephone bill is basically what it is. And they'll demand that the cable operator build an institutional network or I-net and give it to the city.

KELLER: That's a term I haven't heard used in a long time, but there was a time that it was battered around all the time.

JAMES: It's still out there, and many, many cities still demand that be part of the cable franchising process.

KELLER: How do you advise your clients to handle things like that?

JAMES: Well, it varies depending on the city and depending on the size of the system, of course, and what it can afford to do and where they can do things that ... And in some cases it makes sense for the cable operator to, for example, build an institutional network and have the city as a customer of the cable system, in a way, in providing this kind of interconnection that the cities want. So it varies so much by each specific situation. I would say the biggest problem is the delimitations in the federal law on what cities can get in franchise fees are, once again, not absolutely clear. It's a 5% limit, but what goes into the calculation of the basket that the 5% is applied to.

KELLER: It's never been clarified, has it?

JAMES: Well, it's been clarified, but it's still not clear. So there are still arguments on both sides. What often happens is the cable operator, in order to get on with the business, makes compromises that they wouldn't want to make, that don't make sense, that the subscriber ends up paying for. The subscriber may be paying for studios, for example, that nobody is really going to use. So it's a real difficult issue right now. There are an awfully lot of issues out there involving franchises.

KELLER: That's interesting because you were part of a panel discussion this morning in which I asked the question, "What do you consider to be your major problems today?" I think, without exception, everyone said the franchising issues were their major problems right now.

JAMES: Yes. Some of that is that the federal government has been very reluctant to apply a rational scheme of oversight to the localities who are, in many cases, just really need money, and they're looking to whatever businesses they can see in town to provide it for them.

KELLER: Bob, I think we're getting pretty close to an hour right now. Is there anything further that you'd like to discuss or anything that we should be touching on that we haven't up to this point?

JAMES: I think one of the things that I ended up working on in my career at the firm and that I think has made such a huge difference in the cable industry is the development of satellite and the regulation of receive-only earth stations. This was one of the more exciting things, I think, that I worked on at the time. None of us at the time .... I would say there were people that saw what a change this would bring. But I certainly was not one of them. I saw it was going to be quite good and we might have several channels getting up there. But I had no idea it would develop into the kind of distribution system it is today.

KELLER: It's a universal distribution system now – almost everything.

JAMES: Yes.

KELLER: I just wonder when the satellites are going to start bumping into each other up there.

JAMES: Oh, yes. But even that was something that the FCC regulated very heavily at the time. It was really cable operators pushing the FCC time and again, over a period of 5 –7 years, to gradually deregulate the construction of these receive-only earth stations. I think that really opened the door in rural areas in the northwest, for example, but all over the country as well as in the big cities, so that these programming networks could develop and cable would become even more desirable where people were willing to pay subscription rates to receive that programming.

KELLER: The other topic of conversation this morning is what the future is going to be for the wired community as opposed to satellite delivering signals directly to the home. I think the general consensus was that as long as they're going to be delivering other services, internet services and data services and so on, that there's always going to be a need for a two-way line into and from the home. Even if they have to give up carrying all video signals, probably still the cable systems will survive. That seemed to be the general reaction this morning.

JAMES: That's my view too, although it's hard to know how these things are going to develop and whether some kind of wireless technology, some of the technology that's out there now that they're now using to bring high-speed internet into people's homes, more of a terrestrial type wireless operation as opposed to the satellite. If you have a transmitter on someone's house that's got to get up to the satellite and back down, it's very ... I think that's going to be prohibitively expensive.

KELLER: Direct line of sight now is a major concern now.

JAMES: And that's also a very big point too.

KELLER: Tree branches getting in the way of the signal coming either way is going to affect the signal.

JAMES: And of course building and all of that. But I think that was the one area that I've just seen as changed the industry from not having a product to sell beyond improved reception of television, of existing television stations, to really be a force in programming and take the real monopoly away from the major networks from being the only thing people would watch.

KELLER: Do you see anything in the near future that you feel is going to require the industry to go back to Congress?

JAMES: Well, there are lots of ills that I would like to see cured. But I don't know that the cable industry wants to go back to Congress to ask for any particular .... There a number of things out there in particular circumstances – the pole attachment, for example, where rates are, under the new Telecommunications-Comm. Act, with the new services is offering, the rates are going up. But I think there's still the possibility that because the cable rates are such a political issue that the industry may be back in front of Congress fighting the rate issues again.

KELLER: Seems to me they'd be better off just leaving them alone – that Congress would be better off leaving them alone.

JAMES: The last effort at regulation was basically a disaster. It became so complicated that very few people in the world understood what the regulations meant. They were argued about back and forth.

KELLER: I confess to be one of them.

JAMES: And so do I.

KELLER: Bob, we're going to probably wrap this up right now because I think we've covered the major issues that we wanted to cover. I very much appreciate it. Again, the oral history of Bob James was made possible by a grant from the Gustav Hauser Foundation as part of the Oral History Program of the National Cable Television Center and Museum. Bob, thank you very much.

JAMES: Thank you, Jim. I've enjoyed it.

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R. Brian James

R. Brian James

Interview Date: Wednesday February 04, 1998
Interview Location: Denver, CO USA
Interviewer: Jim Keller
Program: Penn State Collection
Note: Audio Only

KELLER: This is the oral history of Mr. R. Brian James, professional engineer. Currently vice president of the TAC Test Center in Canada and a member of the technical advisory committee of the test center. We are conducting this interview on Wednesday, February 4, 1998, at the offices of The National Cable Television Center and Museum at 2200 South Josephine in Denver, Colorado.

First of all Brian, I am going to ask you to give us a little of your background, your schooling, and up till the date that you entered into the cable television industry.

JAMES: Okay. I was born in Peterborough, Ontario, Canada, in 1950. I went through public school and high school there. Crestwood Secondary School, which at that time, and continues to, provide students with an opportunity to either study in technical, arts, or business areas. I had chosen the technical area and found that engineering--electrical type work--was of great interest to me. While at school, my electrical teacher was inspiring to me and he had gotten to be a professional engineer. He was someone that I looked up to and thought that perhaps going into electrical engineering would be a good profession for me.

At the same time, while at high school, I was a member of Air Cadets in Canada, which is a youth organization to build leadership skills and some aviation knowledge. It also had an amateur radio club which I became a member of. In that club I built a two-way HAM transmitter and receiver which sort of peaked my interest even more in the communications area to the point that while at high school I undertook a correspondence course on television repair. That gets me through high school and it is time to select a university.

There are a number of excellent universities in Canada. I was accepted to the University of Waterloo which was a fairly new university. I started it in 1970 and it was actually created in 1958 as a "cooperative plan" university in that you go to school for four months, then you go out into the work place, hopefully in jobs that are related to the areas you're studying, for four months, and then back to school. So that at the end of your university career you get your bachelor degree and you also have the equivalent two years of industry experience, hopefully in the area that you're studying and are interested in. It certainly gives students an opportunity to look at different aspects of what engineering is and different areas of concern and where they might find some interest.

I think I was fortunate on my third work term to be hired by a cable television operator, Mountain Cablevision in Hamilton, Ontario, and that got me into the cable television arena. I recall during the interview being asked some questions on cable television--how it worked, what it was, etc.--the correspondence course put me in good stead at that point and probably helped me get the job. At that same time I had been interviewed by one of the television broadcasters in the area--I didn't get that job. I ended up in the cable television part of the industry rather than in the broadcast part.

I spent three work terms at that cable operator. Initially doing second outlets and installations, and a little bit of digging trenches and stuff. I moved up to installing equipment. Then I did maintenance practice a second work term. The third work term I was actually designing cable plant extensions, hiring contractors to do the installations and overseeing turn-on of new parts of the plant.

At the same time I had met one of the technical field technicians from Jerrold in Canada, and through discussions with him managed to get a position at Jerrold, Canada for my final work term. I was involved in redesigning some existing equipment. They were just starting to produce trunk amplifiers in Canada for the Starline 20. I got involved in production engineering, trying to find out why the units they were producing didn't quite work. It was necessary to change their production, in the line up procedures, to make sure that the equipment worked when it was shipped out. So that got me through the engineering course.

KELLER: Let me interrupt just a minute. Please define work term.

JAMES: Work term is the period that you are out in the field from the university actually working. You have a school term where you're at school and a work term where you are working.

KELLER: You graduated then from Waterloo in 1975?

JAMES: That's correct.

KELLER: Do you recall at that point what was going on with the industry in Canada in 1975?

JAMES: Canadian industry differed from the U.S. in that in the U.S. smaller systems that are away from big cities were sort of the norm for the industry. They were built first because people wanted to get distance signals. In Canada, people wanted to get U.S. signals so systems there were built in the big cities at the same time as they were built in the smaller towns further away. At that point, systems were probably 12 channels and starting to think about how to expand beyond 12 channels, but for the most part I think the country was pretty well wired. I believe there was only one large city, Windsor Ontario, that did not have cable at that point. Probably part of the reason for no cable there is it was just across the river from Detroit, had excellent reception, and people thought it would be a difficult sell to get cable in there--similar to putting it in the big cities in the U.S.

KELLER: Most of the big towns, although they were not exactly on the border, were just far enough from the border where they had to enhance the signals to get the U.S. reception?

JAMES: That's correct.

KELLER: At what time, period, year, were the operators in Canada prohibited from bringing in all of the U.S. signals that they wanted?

JAMES: I am not sure when they brought in that regulation. I think it was before that time.

KELLER: You were limited at that time?

JAMES: They were limited. If you could pick it up off air you could carry it. If you had to bring it in by microwave they took a dim of that and didn't allow it.

So after I got out of the university I was hired at Switzer Engineering ran by Israel "Sruki" Switzer. It was the engineering arm of MacLean-Hunter Cable. They had systems that were part of the Toronto city, which was broken up into quite a few small systems. There wasn't the advantage of having one large system. It had a couple parts of Toronto plus about 15 other small towns and cities in Ontario somewhat removed from the U.S. border and all of whom wanted to receive the U.S. signals. At that point, the general way of doing it was to put up great, big tropo-scatter receive antennas. These would be 50 to 100 feet high and maybe a couple hundred feet wide, a great big parabolic reflector. One would stand in front of it probing around with a small antenna trying to sniff out the signal you desired - usually one of the U.S. services.

The signal would then be put on the cable system and with luck, would fade in periodically and you could try and sell the service.

KELLER: Was this specifically in Toronto?

JAMES: This was in the outside areas. Toronto had good reception because it was close to the border, but the smaller systems didn't because they were along Georgian Bay and further into Northern Ontario.

KELLER: How far north of Toronto would you say these systems were?

JAMES: Probably a 150 miles.

KELLER: So it was a considerable distance.

JAMES: It was a considerable distance.

KELLER: And at a 150 miles those signals travel a good distance.

JAMES: That's correct.

KELLER: You were attempting to bring signals in from the U.S. without the help of microwave?

JAMES: Yes.

KELLER: At this point you were with MacLean-Hunter?

JAMES: That's correct.

KELLER: Your primary job then was seeking out and developing new systems out in that area?

JAMES: I was in the engineering group and it was providing assistance to those systems that existed. Pretty well all the systems had been built at that point so we were getting ready to go through rebuilding.

At that period, systems had probably been built with tube amplifiers and then had been converted to single-ended transistor amplifiers. But they were all 12 channel systems and the number of channels available were starting to increase and there was some demand to increase channels on the systems. In the early 1970s that was starting.

You may recall Sruki Switzer coming up with his harmonically related carrier system. This was a way to use signal-ended equipment but arrange the carriers such that the second order distortion products fell on the carrier resulting in the viewer not being able to see that distortion when looking at the picture. So you were able to add midband channels on the system and continue to use the single-ended equipment

KELLER: Although the amplifiers were divided into single-ended amplifiers you still had the midband in which to work with?

JAMES: The amplifiers had become transistorized and broadband so they would carry both bands without splitting them--they got past the split-band type amps--and they would amplify from 50 Megahertz up to channel 13 at 216 MHZ.

KELLER: Part of it was tube and part of it was transistorized.

JAMES: At this point we were full transistor. But because they were so called single-ended, the second order distortion products are a problem.

The VHF channel allocation was set-up so that, for the most part, second order products do not fall in the channel. The second order products from channel 2 to 6 fall in the midband. Before you get up in frequency to 7. Some of the different products again fall between channel 6 and channel 7. There is a large amount of spectrum space there. You have FM channels in there, radio navigation for airplanes, communications, and some business band in there.

KELLER: This is the Starline 20 equipment?

JAMES: Starline 20 generally.

KELLER: That was the earliest involvement with a truly transistorized amplifier at that point?

JAMES: That's right.

KELLER: You were then capable of carrying channels from 2 through 13 including the midband at that point?

JAMES: You could carry it but with normal channel allocations the second order beats that fell in the midband would cause you a problem. If you had a short system you might be able to slide one midband channel in without causing problems.

For the cable operator this is a problem because you would like to carry more channels and charge more money if you can add a couple of channels. People are starting to demand more channels. Perhaps if the equipment hadn't written off, or if it had been written off, you'd still like to continue to use it.

KELLER: At what point was that problem solved?

JAMES: Around 1971-72 was when one solution came along being the HRC system.

KELLER: Define HRC, please.

JAMES: Harmonically related carriers. All the channels are phase locked to a six Megahertz comb signal. The result is that channels are all offset from normal frequencies. For instance, channel 2 visual carrier is 55.52 Megahertz. It would have to be moved down to 54 megahertz, a multiple of the six Megahertz comb. Channel 3, similarly, would move from 61.25 down to 60 MHZ.

This can be a problem if you have an existing system. For instance, one night you'd go to bed and your television is working perfectly--you get all the channels on the system. Well, you wake-up the next morning, after the conversion, and the channels wouldn't always tune. This was back before you had really good automatic fine tuning.

KELLER: And before they had converters.

JAMES: Definitely before converters. Converters were available but, for the most part, people did not have one.

The MacLean-Hunter system in St. Catharine's was one where they did the experiment on HRC. Overnight people ended up not being able to tune their television set. We ended up over the next two or three weeks doing about 100% service calls on all the subscribers with service technicians brought in from all the Ontario MacLean-Hunter systems to go around and re-tune televisions. Normally you would just try and do the fine tuning on the front of the set. This was back in the days with tuners where you might have to slide the cover off the front of the set and get in there with you're alignment tools and re-tune the oscillators on each channel. In the worst case, televisions couldn't be tuned that far so converters were provided to the people.

KELLER: You said there was experimentation going on with HRC. Was it St. Susan's you said?

JAMES: St. Catharine's.

KELLER: Is this in conjunction with, simultaneous with what was developing in the U.S. at that time?

JAMES: At a similar time I think they had one or two systems that were being built in the U.S. and they used HRC. I am not aware of any U.S. systems doing an overnight switch.

KELLER: Establish which of the Jerrold pieces of equipment had the HRC. Was that the Starline 2?

JAMES: Well, HRC's a headend.

KELLER: Okay but were they still capable of carrying it in the full midband, is that right?

JAMES: Well, yes. The broadband type amplifiers could all carry the signals. So Starline 20, Starline 1 and many other manufacturers of amplifying equipment would be able to carry it.

KELLER: Can the headend be the Channel Commander?

JAMES: Channel Commander, or in the St. Catharine's case, Phasecom. If you go back in history a little bit, especially in the Canadian operation - somewhat different than the U.S. - in Canada, the government required that if you carried a local Canadian station you had to carry it on a channel other than its off-air channel. This is to protect the quality of that service from deterioration due to direct pickup in the television set, where you could get a significant ghost depending on where you are relative to the headend.

In the U.S., for whatever reasons, broadcasters tended to demand that they be carried on channel. So in Canada you now have essentially unused channels that have a problem in that they have a ghost pickup but they could be used for perhaps less popular services.

KELLER: I think you explained the reason for that in one of you're earlier statements when you said that in the U.S., at that time, most of the systems being built were remote from the origin of the signal. As opposed to Canada where they were built in the systems, where system signals were taken off the air right there.

JAMES: That's part of it as well.

KELLER: Let's look at two systems at this point--early to mid-70's. Let's take the system built in Toronto and St. Catharine's that was developing the HRC concept, what would have been a typical channel line up in both of these systems?

JAMES: What did they carry on those channels?

KELLER: Yes.

JAMES: Probably in both of them, St. Catherine's and Toronto, they would be carrying the Buffalo channels off air--three networks. In Canada they would be carrying the CBC and the CTV. Canada also required a local origination channel so that you had to provide equipment and create a local channel for community services as well. For the most part, those would be some sort of weather service where you have your camera looking at different gages or flipping cards with community service publications on them. That would probably pretty well fill up the dial. Maybe one or two independent types that we could pick up.

KELLER: You mentioned on a number of occasions that Canada required. What was the governing board in Canada at that point?

JAMES: At that point, it was the Canadian Radio and Television Commission. That got changed in the late 1970's, and they added telecommunications into it. Originally, they dealt with broadcasters, radio, and television and as they refer to cable television - Broadcast Receiving Undertakings.

KELLER: It took sometime from the development of the industry in the U.S. till the FCC took jurisdiction over cable. Is it true that in Canada the governing board took jurisdiction from the beginning of the industry? What is the history there?

JAMES: That I am not sure of.

KELLER: At the time you came in they already had jurisdiction?

JAMES: It had very serious jurisdiction. If you wanted a rate increase you had to put in your request with all sorts of documentation to justify it and they would come back and say "No. You can't have that 25¢ rate increase. You can have a 23¢ rate increase."

KELLER: So what else could the board control?

JAMES: They controlled the channels that you carried and the location on the dial. How much you could charge the subscriber. They didn't allow you to do any advertising. Essentially the whole operation.

KELLER: How about technical standards?

JAMES: That comes under the Department of Communications.

KELLER: Was that later on that they took that on or was it fabricated at that point?

JAMES: The Department of Communications always set the standards and the CRTC, as it's called, set the regulations for who could operate.

KELLER: Is that still the case today?

JAMES: That's still the case and it's the same for broadcasters. You get the license from the CRTC and they decide who can be a broadcaster, who can be a cable operator. But the Department of Communications tells you how you will operate technically.

KELLER: It's a dual control system then?

JAMES: Well, you have a similar situation in the U.S. in that the FCC sets the standards for the cable system and local jurisdiction awards the franchise and tells you how you will operate.

KELLER: To that extent I guess that is true.

JAMES: Perhaps it's better in Canada where you have one government body deciding who throughout Canada that gets cable operations. In this case, you might be less susceptible to bribes than in the U.S. where local government groups decide who gets the cable franchise.

KELLER: So the local government/province or community would not have any say over who got the franchise or any control of that.

JAMES: That's correct. They're not involved in making decisions but they can certainly put in comments to the CRTC as to who they think should get it. Generally, if it's been awarded and they've had problems and it comes up for renewal they can put in their thoughts on whether it should be renewed or not.

KELLER: If two operators were seeking permission to operate in the same area, did they both file applications and then the board make the decision as to whether they get it?

JAMES: That's what happens. Normally - probably hasn't happened recently - but before all the systems were built, if you were in a city or an extension to the city, and an existing operator had the franchise for the city and a new subdivision is being added, at some point the CRTC would say their accepting applications for that area.

KELLER: It wouldn't be a matter of just an extension?

JAMES: Not necessarily just an extension. I know one case where they weren't getting around to doing it and a large number of subdivisions had gone in and the cable operator got special permission to actually build that area on the understanding that when the CRTC got around to reviewing it they wouldn't necessarily get that area, and in fact they didn't.

KELLER: Did that cause any problems? The interfacing between the two systems?

JAMES: Not really.

KELLER: Would there be a requirement to interconnect?

JAMES: No. Normally they wouldn't be interconnected. So in this case, where the trunk cable entered the new area, it essentially got cut and the new signals were fed in. And the new person at the new franchise essentially bought out the wiring and everything that was in there. Appropriate compensation was paid to the person who actually had done the wiring.

KELLER: This was developing as you were with MacLean-Hunter in the mid-'70s?

JAMES: That's correct.

KELLER: Where did you go after that and what was happening at the time?

JAMES: I spent from 1975 till about 1981 at MacLean-Hunter. There I initially looked after the systems in Ontario. Then towards the end of the 1970's . . .

KELLER: When you say "looking after" what do you mean by that?

JAMES: Provided technical guidance to them. Generally systems were small and did not have a lot of sophisticated test equipment – spectrum analyzers and that sort of thing were not available. Engineering people took care of that. We would go out and, if there was a problem, did some troubleshooting.

KELLER: Was this on a contract basis with the individual systems or with their own systems?

JAMES: For the most part, within their own systems. We also did contracting outside to other cable operators on a contract basis. Where we would perhaps design microwave paths, review their system design extensions.

KELLER: You mentioned microwave. When were you permitted to microwave U.S. signals up into Ontario?

JAMES: It started in the late 1970's.

KELLER: In the time frame that we are currently talking about?

JAMES: That's right. The operators north of Toronto got permission to microwave the signals. The rules came out three plus one - you could carry three networks plus one other.

KELLER: Three U.S. networks?

JAMES: Three U.S. networks plus one other independent or PBS.

KELLER: But you were required to carry also these CBC . . .

JAMES: You had to carry all the local channels. And then you were allowed to carry, if there was space on the system, additional channels.

KELLER: First of all you had to carry the local signals--Canadian signals--then you could add three U.S. and one educational.

JAMES: One other U.S. service which was either PBS . . .

KELLER: It could be either independent or educational or one of each?

JAMES: No. One more.

KELLER: One more and that was it?

JAMES: That was it.

KELLER: Is that still the case today? I mean up until the time of the satellite, is that still the case?

JAMES: That was still the case.

KELLER: Probably still the case today?

JAMES: To some extent. I think it's now a two for one maybe three for one, but you have to carry one Canadian satellite service for every two or three U.S. services you carry. The government is really trying to push keeping it Canadian. There seems to be great concern about loosing Canadian identity. Not that that's a real problem.

KELLER: That's not only the case in television but in every part of Canadian life.

JAMES: That's right.

KELLER: Right. Now we are in the late 1970's and you're still working at MacLean-Hunter, still doing developmental and testing work for Switzer and MacLean-Hunter, where did you go from there?

JAMES: From there I went to Cablesystems Engineering.

KELLER: Which was what?

JAMES: It was part of Canadian Cablesystems which had just been bought by Rogers Cable. It was the engineering group for what became Rogers Cable.

KELLER: What systems were they serving at that time?

JAMES: They had Toronto. A number of parts of Toronto--London Ontario--and smaller towns that came around Ontario. They also bought Premiere Systems of Vancouver area and Calgary.

KELLER: And Victoria?

JAMES: Victoria at that point was under it.

KELLER: It was Premiere at that time?

JAMES: No.

KELLER: So you went with this group and doing primarily the same thing you were doing at the Switzer group?

JAMES: Same sort of thing. I was hired as Director of Standards and Practices which entailed setting the technical standards for the systems and overseeing that they were met. Essentially, I oversaw a technical audit group who would drive around checking the equipment and do technical audits of the system. I'd ensure that they met the Canadian regulations. Also, at that point, Rogers had systems in the U.S. and we were responsible for those too.

KELLER: Which systems in the U.S.?

JAMES: They had Syracuse, Minneapolis was being built, a number in the California area--Garden Grove, Huntington Beach, etc.--and a system outside Erie.

Shortly after I joined they bought U.A. Columbia, so they had all the U.A. Columbia systems which were trying to be pulled into Rogers.

KELLER: Were you setting different technical standards for the U.S. as opposed to what you were setting in the Canadian systems?

JAMES: No. Generally they were the same. It's easier to set a policy that way.

KELLER: Who was more stringent at that time? Say you develop systems in the U.S., would you bring them in to the same standards that you had existing in Canada.

JAMES: Generally, yes. The U.S. systems, because of the franchising wars that were going on, tended to be a lot higher channel capacity than the Canadian systems. Canadian systems had been built and they were just ticking away, creating money. People would like a few more channels and gradually you increased them. In the U.S., you bid for one franchise and whoever won it with whatever number of channels they had said they were going to build that was the baseline for the next city that got bid. You went from your 30 channel system to your 35, 40, 50, 60 and dual cable.

When I was still at Switzer we were looking for ways to increase channel capacity without going through a second cable because it's very expensive. Switzer put a lot of pressure on manufactures to go beyond 300 MHz up to 400 MHz. I recall designing and writing part of the franchise proposal for Atlanta, which I think was the first one awarded at 400 MHz. And all the effort spent getting the Scientific-Atlanta, at that point, to say yes, we are local, and, yes, we will build 400 meg equipment.

KELLER: Which they did.

JAMES: Which they did.

KELLER: And then perfected it.

JAMES: And got it working. At that point, MacLean-Hunter was bidding a number of systems in the Detroit area. Suburbs around Detroit proposing 400 megs for those as well.

KELLER: With the Rogers operation in the U.S. that's how you became equated within the U.S. Is that correct?

JAMES: Yes.

KELLER: U.S. systems and U.S. standards and policies and so on?

JAMES: Right. While I was at Rogers, it was about 1982 or 1983, the EIA (Electronic Industry's Association) were looking into feasibility of having stereo television. They had done some preliminary testing on some proposed systems – a Zenith system, a Japanese system and one other. They were to the point of getting ready to vote when Zenith said, "You vote, we sue! We have improvements. We want those tested. If you don't test it we are going to sue you and stop the whole process." So they – the EIA - decided to go ahead with the second round of testing.

About that time, the cable industry woke up to the fact that stereo television was going to be a possibility and that, perhaps, people with cable subscriptions would want to receive this. Cable operators thought, maybe, they should look into seeing whether or not you can carry the stereo television on cable.

The NCTA then got active in it and were looking around for someone to assist in the testing. As Rogers had systems in the States they had membership in NCTA and it turned out that their engineering group was the only one interested in helping out. I got assigned the task of going to Chicago for the Summer of 1983 to test the proposed stereo systems. From that, I determined that the Zenith proposal would work adequately well on cable.

Part of the problem is that on cable you have to reduce the aural carrier level, otherwise you start seeing beats from it in the upper adjacent channel. This comes from the fact that, for the most part, television manufactures have ignored the existence of cable. Television broadcasters carry their aural carrier at a very high level and that's not a problem because normally you don't have adjacent channels. On cable you do have adjacent channels and if the lower adjacent aural carrier doesn't get trapped adequately it interferes with the video. So you can reduce the level and still get good quality audio on your cable system.

But when you start adding the difference channel--for stereo you have a left channel and a right channel, you sum those two together and that is your primary channel that you transmit and you subtract the two; that's call a difference channel--that's carried at a lower level and on a different carrier.

KELLER: Without getting ahead of ourselves, was there ever a joint industry committee investigating these problems in the broadcasting industry and the cable industry at that point?

JAMES: Not very much with the broadcasting industry, no.

KELLER: Did it ever develop when there was a joint committee?

JAMES: No. It was broadcasters.

KELLER: To call it a solution to these problems we are talking about?

JAMES: Not those particular problems. Aural carrier problems, no.

KELLER: I just thought that was one of additional problems that didn't get . . .

JAMES: Generally the cable industry has taken what's been transmitted and found ways of working around both the broadcasters and the set manufacturers. There is perhaps some animosity between the three groups that continues.

KELLER: This then is how you got first introduced into the NCTA committees?

JAMES: That's correct. I got selected to do this. I first met with Alex Best. At that point, he was still with Scientific Atlanta and then moved to Cox Cable. He chaired the NCTA multi-channel sound sub-committee and had developed some test plans as part of that committee for testing to take place. So I met him in Chicago at Matsushita Industries, which is where the testing actually took place, and discussed what had to be done. From that, I developed actual test procedures and undertook the tests. As part of that, I started attending the NCTA engineering committee meetings and giving updates on what was happening. That got me introduced to the engineers in the U.S. cable industry.

KELLER: Do you recall some of your associates at that time that you were working with?

JAMES: Alex Best was the main one. Bill Riker was director of engineering at NCTA and I met him initially in Chicago and then when I was in Washington at the engineering meetings. I was helping to write part of the responses to the FCC notices on multi-channel sound.

KELLER: At this point your work was primarily in the aural area?

JAMES: At that point, I was looking at how well the cable system could carry the multi-channel sound signal.

KELLER: And you did solve that problem.

JAMES: We determined that the Zenith system could work adequately on cable providing the compression system was used. That helps reduce the effect of lowering the aural carrier. When you lower the aural carrier it gets close to the noise floor—so the sound gets noisy. When you put the stereo signal on a long cable system you could put it into noise. It would be like a very noisy FM station when you're far away from the transmitter and it's cutting in and out and noisy. With the use of compression on the aural carrier you could overcome this noisy signal.

KELLER: At the same time, to your knowledge, were they trying to develop a more sophisticated type of set-top converter technically? I may be going on in a different area.

JAMES: That would be a different area. We had developed set-tops initially so that you could get around the direct pick-up problems on television sets. If your cable system is tight, which occasionally happens, you can get a signal from the headend to the subscriber without off-air signals getting into the cable system. You still have the problem with the fact that the television set was designed to pick-up off-air signals and still does a good job of doing that, even when it's hooked to the cable system. So your local channels, which if they are carried on channel, would be visible with a ghost in the picture from the transmitter on the same channel.

Set-top converters were developed so that you could take the cable channels and convert them to some channel that was not a local off-air channel - these days it is normally channel three or channel four - so there isn't any off-air signal to interfere with the cable signal. If the system is tight then you get good quality, ghost-free pictures to the subscriber. That is still used these days as a test. If someone is complaining about ghost on their television set we need to determine if it is a system problem or a set problem. (In lots of instances you don't use converters because they have expanded the capacity of the television tuner.) So you put a converter ahead of the television and if the ghost disappears you say, "Sorry, that's your set and we can't do very much about it." If the ghost is still there say, "This is our problem." Then you go start looking for a signal, leak and ingress into your cable system.

KELLER: We're talking about the mid-'80s. The franchising efforts in the U.S.--competition for franchises in the U.S.--was going on probably since the early '70s and right through the '70s and into the '80s.

JAMES: It really heated up in the late '70s.

KELLER: Yes. How did you view it at that point when they were bidding these thirty, forty, fifty, sixty channel systems—400 MHz, 500 MHz systems. How did you view that from an engineering standpoint?

JAMES: It's quite exciting to see channel capacity being pushed. There was some question as to what you were going to put on those channels.

KELLER: But that wasn't an engineering . . .

JAMES: It wasn't engineering. It was just sort of "this is nice what they are going to do with the channels." There was great concern that we had promised to build these systems, but where were you going to get people with some expertise to build and run them? At that point in time, if you had three months in the industry you were probably an old timer and could move on to bigger and better jobs with no problem.

A lot of people from Canada headed to the U.S. to get better jobs. And there, I think you had the advantage with Canadian large cities being built first you had people who were used to operating larger systems and they could quite easily find employment in the U.S. systems. As the builds continued, they could move from one system to another, to another, and keep moving up in the industry. Others who came in, same thing. If you had three or six months experience then the person next door was willing to give you more money to come and work for them. Maintaining systems, building initially. Building them so that they could somewhat follow the plans that they were suppose to be built to, and would actually deliver signals when the installers went to hook people up was a major challenge.

KELLER: We are now spanning the era of the early to mid-'80s in which all of this experimentation was going on with the manufacturers and with the NCTA, with the FCC and so, as to how you were going to do all these things.

JAMES: Right.

KELLER: You were currently still with Rogers and then what happened after you left Rogers? How did you leave and why did you leave?

JAMES: I left in 1985. Bill Riker at NCTA had left late 1984 to join SCTE, to run SCTE, which was suffering a lack of direction. It had had a couple of presidents - one who had done a lot of good and then departed—but there wasn't really anyone pushing SCTE at the corporate level and getting people involved at the corporate level, i.e. going out and selling it. Bill Riker decided that there was something that needed to be done and something that he could do so he offered his services and was accepted. He took on that job and has done an excellent job in building SCTE since then.

KELLER: And he is still with SCTE?

JAMES: He is still is with SCTE. It had gone from a couple thousand members to many thousands under his leadership. His departure left a void at NCTA and I was starting to think it was time to find something more challenging. I spoke to Wendell Bailey, vice president of engineering at NCTA, and indicated my interest in becoming a director of engineering. Over the next while it resulted in my being hired and moving to Washington.

END OF TAPE 1, SIDE A

BEGINNING OF TAPE 1, SIDE B

KELLER: I am speaking with Brian James, who at this point had just joined the NCTA as director of engineering.

JAMES: That's correct.

KELLER: What was your commission as director of engineering with NCTA?

JAMES: I was there to assist the vice president, science and technology, in technical matters coming before mainly FCC and Congress. I provided the technical expertise necessary in dealing with technical matters at FCC.

At the time I joined we had just finished the multi-channel sound docket, I believe. The industry was starting to move into carrying multi-channel or stereo television. One of the first questions was "Should that be mandatory - should cable operators be required to go out and replace their equipment immediately or could they be given some timeframe to replace the processing at the headend and, in some cases, the converters in the field to make them capable of passing stereo."

It's interesting that at that time Zenith had come out with their scrambling system. As an extra feature it was able to provide volume control. A nice feature - people liked to sit back in their easy chairs and switch channels and control the volume. The downside was, while it was a Zenith stereo system that was selected, their set-top converters could not pass it.

KELLER: Z-tac system?

JAMES: A Z-tac system. You might think that perhaps one side of the house wasn't talking to the other side. So there was a lot of concern. If the FCC were to say "The stereo signal is a technical part of the video and you have to carry it." It would have required that a very large number of millions of dollars be spent upgrading plant and changing out converters. Fortunately, the FCC decided that the mono-aural part, the single channel sound, was the basic television signal and you didn't have to convert all your system equipment to carry stereo even if the broadcasters started carrying it.

Generally, a cable operator would wait until stereo came to a broadcast station and then would upgrade their processing equipment to pass it. If they were using Z-tac converters, as they worked them through repairs they would upgrade them to pass stereo.

KELLER: Was there an attachment that could be put on to the processing unit at the headend . . . did you have to change out the entire processing unit?

JAMES: If it was what is called a heterodyne processor, which takes the off-air signal and feeds it or converts it to an IF frequency, filters it and then converts it back up to the cable frequency, that normally passed the stereo signal without problems. Where you got into trouble was taking a signal off-air, going down to baseband--where you have baseband video and baseband audio - and for whatever reason, decided to process the signal by doing some video processing and enhancement. When you went to remodulate the signal, the stereo signal was not there. The work-around for that was to not take the audio signal down to baseband but pass it through at IF and convert back up to the cable frequency and that would pass it. Second option would be to take the audio signal down to baseband and then put it through its own stereo encoder. A lot of people did that. Operators also started doing that for the satellite services. The satellite broadcasters before too long started to provide a stereo feed as well as a mono-aural feed. The people who bring you headend equipment, Scientific-Atlanta and Jerrold generally, started building stereo encoders so that you could take the satellite signal and stereo encode the audio that you got and provide that to your subscribers. Prior to that they had stereo available but normally it was carried in the FM band so you could watch the channel on the television. If you had your FM tuner hooked up to the cable system, and in the same room and no one else wanted to listen to the audio of another radio service, you could have stereo television. Now the cable industry had caught up with the consumer electronics and the broadcasting industry had caught up with the cable industry and provided the customers with stereo television. And it was now inband so that if you had the stereo television set you could receive it.

KELLER: This was one of the areas that we you were working on at the NCTA. What other areas were you involved in at that time?

JAMES: At the same time, actually the week I got there, was the beginning of a trip by a number of industry engineers around the country looking at scrambling systems for satellite.

HBO had announced they were going to use the Video Cipher System and it actually had been installed at the video uplink site and they were testing it. Showtime had not announced what they were going to use, but the industry was making a lot of noise about the need for scrambling satellite services. Prior to that they were unscrambled.

Generally, people didn't have a big ten foot dish in the backyard to receive and so it wasn't a problem, but now they were finding more people were getting it off the satellite and especially you could get it into commercial operations, i.e. bars or whatever using it. HBO wanted to protect their product and the other satellite users did as well.

So the industry's now concerned about HBO using one scrambling system and Showtime using another. For a cable operator that isn't a problem because for each channel you have to have a separate decoder anyway because you're running them all at the same time.

There was some lobbying going on in Congress where satellite backyard dish users, generally rural people who have been getting the signal for free, were starting to lobby their congressional people. They were saying, "Skies are going to go dark and are not going to be able to receive these services that we can't get anywhere else - there isn't cable around here, please help us."

Well, the industry was aware of this and there was concern that if you have a number of different scrambling systems then the backyard user would have to buy a number of different receivers and that could get quite expensive. So being quite careful about anti-trust implications, the NCTA had decided to go around and investigate various proposed satellite schemes and determine which one was the best and, by some method, would be able to suggest a single standard that could be used.

We went around and looked at half a dozen different locations and different proposals, i.e. General Instrument, Scientific-Atlanta, Oak, Video Cipher System, and a couple others that had come out of the woodwork and proceeded back into the woodwork.

KELLER: You finally settled on one?

JAMES: Well, what happened is while we were on tour Showtime announced that they were going with Video Cipher as well. That meant the two big boys, if you will, had decided on that and it was expected that the rest of the industry would follow along. So we ended up not having to make a recommendation and managed to stay out of jail. Perhaps that was fortunate although Video Cipher System was probably not the one that would have gotten selected by the industry panel. There were a couple others that appeared to have slightly better scrambling techniques.

KELLER: What engineers made that decision then to go with Video Cipher?

JAMES: It was the HBO and Showtime engineers.

KELLER: They were not working with your group at that point?

JAMES: No. They were not on the tour.

KELLER: That's surprising.

JAMES: It was the operators who were on the tour.

KELLER: That's very surprising that they wouldn't be involved in selecting their own method of scrambling.

JAMES: My guess is that was part of the anti-trust requirements.

KELLER: But as an association the association should come out with a recommendation as to what is the best system.

JAMES: Not really. The anti-trust laws are quite restrictive in that area. You can't, as a group, decide to boycott someone.

KELLER: It wasn't a matter of boycotting, you can set a standard.

JAMES: You can set a standard and suggest it. Their lawyers were trying to be careful.

KELLER: What other problems were you working on and/or what other committees were you working with or had knowledge of working with the NCTA at that time?

JAMES: The other major effort was signal leakage, something that cable systems have probably done since the first system was created. There had been an open docket at the FCC for many years and it finally worked its way through the system. It was one in which the FCC came up with regulations on how much leakage a cable operator was allowed to produce and the maximum levels you could have on a system before you came under the leakage rules.

In the aeronautical band, where the leakage concern was greatest, there had actually been a couple of incidences where aircraft radio communications had been interfered with cable operators.

It's interesting that based on two or three actual incidences of lost communications for a few seconds because of cable we have all these regulations. Everyday you have instances of stuck-in microphone switches, which causes lots of interference with aviation communications. But anyway, we came under these regulations. The industry now has to maintain records of leaks that they find in the system, when it was found, what level it was, and how quickly it was repaired. They have to do an audit every year and come up with essentially the summation of the total leaks they have and it's called a cumulative leak index (CLI). It has to be below a certain number. That test can either be done on the ground, driving around with receivers that are receiving the signal and measuring leaks or you could do it as a fly over, which is probably a more realistic one. If you're worried about interference to aviation then you were to fly over the system trying to receive a test signal and record the levels you receive.

KELLER: What other things were going on at this time? What other things were you investigating?

JAMES: In 1985-1986, towards the end of 1986, something that would take the next ten years or so to work its way through started to raise its head, which was high definition televisions.

KELLER: Before we get into that, and I do want to get into that, were you familiar with the FCC's first order report and the second order report? And, were there any technical standards in there that had to be compiled with in either of those two reports?

JAMES: Which reports?

KELLER: The FCC's first report order.

JAMES: On?

KELLER: On cable television. The first time they took regulation of the industry itself.

JAMES: I am not familiar with just what came out at those times.

KELLER: The first report order was primarily on the use of microwave. The second report order, I thought and I could be wrong, went more into the technical standards and their requirements.

JAMES: When I got involved here there were certainly technical standards that the systems had to comply with and had to do yearly test to show that they complied with them.

KELLER: That may have been after the second report of order.

JAMES: Those probably came out of it—here are the requirements you have to meet. It bounced around in the late 1980s between "Do we really need technical requirements for cable systems or have they gotten big enough that consumer aggravation will result in quality being maintained?" There was a while when there were no regulations, no technical requirements for cable. Then the decision was made to re-implement them. So the industry has gone from no regulations to here are some regulations, no regulations, then here they are again. And we are currently required to meet certain minimum requirements.

KELLER: You started to get into the area of high definition television, and it was known by another name wasn't it?

JAMES: The FCC when they started working on it called it advanced television.

The background on it, where it came from, was the Japanese NHK-Japan broadcasting had been working on a higher definition system for many years and in its early 1980s had actually brought it over to the National Association of Broadcasters and showed people what it was like. It was experimental at that point.

KELLER: Did this have anything to do with the resolution in lines?

JAMES: Yes. High definition means higher definition . . .

KELLER: A 125 to our standard which is what 625?

JAMES: We are 525.

KELLER: In Europe I understand there is 1125.

JAMES: No. Europe was 625.

KELLER: I thought they had a higher definition at that time?

JAMES: It's a little higher except that its refresh rate is a little slower and the transmission scheme is a little different so you get better quality video, probably, in Europe than you do within NTSC.

KELLER: When we are talking in terms of the U.S. right now we are talking about going from 525 to 1100+?

JAMES: Probably over 1125 lines.

KELLER: Explain lines of resolution would you please—to non-technical persons.

JAMES: The television picture is created by scanning the phosphor on the picture tube with an electron beam and illuminating it. When you do this scanning you are scanning one line at a time—a very thin line. When you put enough of these together you can get a picture. NTSC has 525 lines and about 480 of them are actually active because you have over scan at the top and bottom of the screen. You don't want to start the picture right at where the picture tube starts, you have to start it above it so that everything has come into sync and is scanning properly when you start to light up the tube. That results in say watching perhaps a football game or hockey game or something like that where you can see the crowds and you can say "Yea, I think there are people there or the general shape of humans." So we'll say there are people in the crowd. But you couldn't say there is actually some one unless you are doing a close-up of the crowd because you can't make out their facial features.

High definition was defined as being similar to a 35mm theater presentation and normally twice the horizontal and vertical resolution that exists in televisions. So in that case, watching the same game, you should be able to pick out features of people in the crowd and, depending on the situation, might actually recognize them. It is much more impressive. In fact, on a good display unit it will give you an almost three-dimensional feeling.

KELLER: So this was starting to be talked about and developed—you say the Japanese had developed something along these lines.

JAMES: The Japanese had developed the system that in the early 1980's was starting to show up. Starting in 1985 but culminating in 1986, the FCC had a docket out suggesting that in some areas of the UHF spectrum, in some towns, where a given channel isn't in use you could perhaps allocate that to a land mobile operator i.e. business band, two-way radio operation. This caused television broadcasters a lot of concern. The allocation plan for television is set-up so that you can fit in a whole lot of stations and they won't interfere with each other. So you perhaps use a channel forty in one city and you have to go a long way away before you find another channel forty. That is to minimize the effect of interference. The FCC was proposing not going quite as far and putting in a two-way radio operation. The broadcasters were quite concerned that this could degrade quality of their service so they were looking for ways of overcoming this proposal.

At that point the Japanese were getting to where they had a high definition system that would work on satellite. You could uplink a high definition picture, downlink it, and watch it. They were getting close to going into production with it. The people in the National Association of Broadcasters (NAB) and the Maximum Service Telecasters, a couple of lobby groups in the Washington area all got together and were looking for some way of saving their spectrum. They decided this high definition television would be a good thing to come out with and say to the FCC, "You can't give away that spectrum because we need it to carry this high definition service." At the time high definition was going to require two television channels so in order to carry high definition you need the additional spectrum to be able to carry the high definition service. So they told the FCC they couldn't give away the additional spectrum to land mobile because you'd never get it back. This was a good thing and they decided to go with that.

They contacted the Japanese and brought the equipment over and set-up some demonstrations. One at the NAB headquarters. They took it to congress and set it up in the Senate chambers showed people there. Took it over to FCC showed them there. Generally it created a lot of publicity and it got some public interest behind it and started the FCC down the path of investigating a new television system. The FCC did a report on it and decided to halt the land mobile proceeding until they finished their report on high definition.

In 1987, the FCC appointed the Advisory Committee on Advanced Television Service. They had a two-year mandate to go forth and investigate advanced television services. Advanced, generally being anything better than the existing service.

KELLER: Were you a member of that committee?

JAMES: I was on a number of task forces of that committee.

KELLER: Had the Japanese adapted the system, adopted the system?

JAMES: They were getting ready to do some trial transmissions on it.

KELLER: Had they subsequently done that?

JAMES: They have gone into actual transmissions and had the service up and running—it's still up and running. They made use of their system.

KELLER: What part did you play in the task force of this committee?

JAMES: I was involved in the cable portion of the committee. We had to determine what effects the proposed systems would have on cable. Would they interfere with existing services on cable? Would existing services on cable interfere with this advanced television service?

A number of us came up with list of tests that needed to be done and then a test plan for carrying out those things. Then that was submitted to the committee and adopted. We were getting ready to do some testing.

KELLER: Then what happened?

JAMES: Then the committee sent out essentially a request for proposals to anyone and everyone that they thought might be interested in providing some or all of the new high definition, or advanced television service.

We got back a number of responses and invited all of the respondees - I recall there was about 23 of them - to what we called our hell week. They had three hours to give a presentation and be subjected to questions on their presentation by a lot of engineers knowledgeable in the art of television and cable, i.e. What can be done? What is being developed? We determined that there were a number of them that certainly had potential and that could probably be built in a reasonable timeframe.

One of the requirements we decided on early was that any system that was recommended for adoption would have to exist. It couldn't be a paper proposal. It couldn't be a computer simulation. You had to take video and put it in one end and get pictures out the other end.

KELLER: Seems reasonable.

JAMES: We thought so. A few people thought it was absolutely ridiculous. A computer model should be able to demonstrate whatever you want the system to do and you just go build it afterwards. But most people were somewhat adamant that it must exist.

KELLER: There was a question of how the system could interact or fit in with the existing system at that time too. Is there not or still is?

JAMES: There was a question and it was answered - the question was compatibility. Do you take and build on the existing NTSC system or do you say, "Let's cut our ties at that system and go to a new system that is completely incompatible?"

When black and white went to color they made a compatible system. If you had a black and white television you could still watch color. The FCC decided that it was not necessary for the advanced TV to be compatible, and in fact, it might be advantageous to not be compatible. That, perhaps, you had done as much as you could with the existing system and it was time to go another step and abandon it and start with something completely different.

The task force went through these proposals and decided that some were feasible and others required some changes to the laws of physics and suggested that perhaps people go back and try to get those implemented and then come back to us. But we didn't think they were going to get very far and we weren't going to spend a lot time on them.

So we came down with six proposed systems that looked like they had good potential and people would vote to go build them or test them. A deadline was setup, about May 1990. The whole process was set-up so that if something wonderful came along it wouldn't be precluded from consideration just because it was two hours late in submission. All the way along there were deadlines - we would stick our heads up, look around and say, "Is there anything coming at us that just might be wonderful and should we consider it?" Again, there were deadlines for those various points.

In May, 1990, (you may recall the committee was set-up for two years in 1987) we were getting ready to tell which systems were going to be tested (we were into the second round of the mandate). General Instrument showed up and said, "We have a system we would like to submit, and by the way, it is digital transmission." Up to that point people were all analog, based on existing transmission techniques. One of them was called enhanced television and it was built on the existing NTSC service. You look at NTSC and there are little holes in the spectrum and in time where we can stuff in little bits of information. Their theory was that you could stuff this in and existing television wouldn't know the difference and if you had enhanced television receiver that could make use of this additional information it'd give you better quality picture.

KELLER: Compatible in other words?

JAMES: That was a compatible system. It wasn't a good system. The picture quality was degraded on NTSC and not great on the enhanced system. When we finally got around to testing it, it actually went through testing, they asked that the report not be published.

KELLER: Now this was the FCC committee that was with you?

JAMES: This is the FCC Advisory Committee on Advanced Television Service for the U.S.

KELLER: Which you were participating on one of the task forces as a representative of the NCTA of the cable industry?

JAMES: Right. In that timeframe from 1987 to 1990, it became obvious that testing would be required. The Committee had mandated that if the system was going to be adopted it was going to have to exist and it was going to have to prove itself. So some form of testing had to take place. Part of the work with the committees was to come up with the test plan and test procedures. Having done all that you probably need a place to actually do these test. Some consideration was given to going to the various proponents and doing testing there. That was quickly abandoned for various reasons. One being, how do you ensure that something strange isn't going on when you are doing the testing. The other, how do you show that you have the same test conditions and same equipment that you are subjecting these things to.

Broadcasters fairly early on agreed to get together - PBS and a number of the broadcast associations and lobby groups in Washington. They were going to fund what was called the Advanced Television Test Center.

KELLER: Did that include NCTA?

JAMES: No. NCTA was invited and declined. Part of the reason was if you look at the makeup, you have seven or eight broadcasters, and NCTA. You might have NCTA saying "We think this should be done" and the broadcasters all agreeing it should not be done. We (cable industry) would totally loose control - we certainly had the potential to lose the control - we didn't want that.

Around the same timeframe CableLabs had been formed, which was a consortium of cable television operators in Canada and the U.S. About 1990, they had a few people on staff and were looking for things that needed to be investigated and decided high definition television was definitely one of them. It was coming at us, let's be ready for it. CableLabs indicated that they would pay for the cable portion of the tests. That was how the cable industry was going to fund these tests, through CableLabs. So the broadcasters were doing it through their associations, cable was doing it through one of their groups which was CableLabs.

I had been on committees coming up with test plans, and I got talking to the president of CableLabs, Dick Green, and indicated that I had some interest in running a test lab to actually run these tests. In early 1990, I got hired by CableLabs. They were just finalizing an agreement with the Advanced Television Test Center to have space at the test center and have access to the equipment and share test results. I was hired to setup the cable test lab and run it.

KELLER: Before we get into your work at CableLabs I want to go back and ask you about three things that I think were developing at roughly the same time.

JAMES: Okay.

KELLER: One, fiber optics as far as in cable. Two, the use of the vertical interval. That came to my mind when we were talking about lines of resolution. Three, the conversion from analog to digital. All of which, I think, were developing along parallel lines just about that time. There may have been another one. But those at least come to mind right now. Were these not also developing at the same time? Did they have any interaction on each other and the work you wer