Ben Conroy - Oral History
Interview Date: Friday May 22, 1987
Interview Location: Manchaca, TX USA
Interviewer: Robert Dudley
Collection: Penn State Collection
Note: Audio Only
Cable industry pioneer, and enthusiastic jazz pianist, Ben J. Conroy Jr. passed away on February 28, 2016. He was 92. Conroy was also instrumental in the beginning and early development of The Cable Center, where he served as the first Chairman of Board of Directors of The Center when it was at Pennsylvania State University. In a letter to the Cable TV Pioneers in 1987, Conroy wrote, “The National Museum of Cable Television [now The Cable Center] is the brain child and a project of the Cable TV Pioneers in association with Penn State University.
The project grew out of the notion of many of the Pioneers that the group should use the opportunity to give back something for the industry that has been so good to note its founding history and to help perpetuate it.”
The Cable Center was saddened to learn of Conroy’s passing. Jana L. Henthorn, president and CEO said, “Ben Conroy was one of the founders of The Cable Center and as early as 1974 he floated the idea of a “cable TV source library,” to his fellow CATV Pioneers. It was also at his suggestion and foresight that The Center started its one-of-a-kind oral history program. We owe a debt of gratitude to Ben and salute the man and his legacy.” Diane Christman, senior vice president added, “Ben had a deep passion for the cable industry and preserving its legacy. He was intelligent, an accomplished jazz pianist, and he had the sharpest wit and was really very clever. I always enjoyed when our paths crossed!”
Les Read, Executive Director of the Cable TV Pioneers and close friend with Conroy said, “The Cable TV industry had lost a true Pioneer and a heck of a piano player. His passion for cable and service to his communities he served provided the best of cable service. He felt it was important that the story of this great industry be told and he worked to bring The Cable Center into being.”
DUDLEY: We're in the offices of Ben Conroy in Manchaca, Texas. It's May 22, 1987. We're going to be talking with Ben, a Cable TV Pioneer, about his involvement in the cable industry from the early days up through 1987. Ben, let's start out with some background, biographical information. Tell us a bit about yourself and your family.
CONROY: Okay, I was born ... Is that back far enough?
DUDLEY: I think so.
CONROY: October 28, 1923, in St. Johnsbury, Vermont, mainly because that's where the hospital was. My parents lived in a small town of Island Pond, Vermont. My father had actually been a Brooklyn-born and bred person, and in 1920 he, supported by funds from his father and his father's associates, went up to Island Pond to operate and manage a furniture factory. I won't go into details surrounding all of this, but this is how he came to be up in Vermont. He'd been up there since 1920, so he would have been about twenty-two years old, at that time. My mother was a native Island Pond girl. Her father was a locomotive engineer on the Grand Trunk, the Canadian National Lines, hence my interest in engines. We lived in that small town until 1932, with the onset of the Depression when the markets for that kind of furniture dried up completely. So my father then moved the family--by that time I had a brother and a sister. Incidentally, my brother was also born on October 28, but two years later than I.
DUDLEY: Your brother's name being?
CONROY: Jack. And my sister's name is Eleanor. One other sidelight on that is that we have a first cousin who was born on my brother Jack's birthday, so there's the three of us on October 28. How they arranged all of that is still a mystery to me.
But we moved to Brooklyn where my father's home had been originally, and moved in with his sister's family until my father could get settled. My father was always very proud of the fact that when he closed the furniture factory, he didn't owe anyone a dime. There was actually a small surplus. He paid off all the debts. However, he didn't have much money left so he was starting all over again, and I believe the '30s were as tough a time for him as a lot of other people.
On through the '30s I used to go back to Vermont during the summers and spend them with my grandparents. It was always a great treat for me. Not only riding on the engine but fishing, playing tennis, swimming, and, actually, even haying and doing some farm work. It made for good summers.
So on up to the onset of the war. Let's see, in 1941 I had finished high school. I was going to Brooklyn College. I took a year there. And held some summer jobs. All during that time I'd do various jobs--delivering Saturday Evening Posts, shoveling snow in the wintertime, and mowing lawns to get a little spending money. The first summer I had a real job was working in Wanamaker's Department Store in New York as a stock boy. The next summer I worked in the Brooklyn Navy Yard where they were building dry docks. This would have been the summer of 1942. I liked that because I thought the pay was tremendous. I was getting all of $42 a week, where at Wanamaker's I'd only made $18 a week. But it had looked pretty good to me then. With the money I earned that summer of '42, I put myself through a semester at Brooklyn Poly Tech Institute because I had an interest in going to the Naval Academy and thought I needed some more engineering courses. I took engineering and mathematics there.
DUDLEY: Where did that interest develop from ... going to the Naval Academy?
CONROY: I can't tell you where. It just always appealed to me. In high school I'd had a friend, a close friend of my father's, named Tom Fitzsimmons, who was a captain in the Navy. Once or twice we'd get tickets to go to the Army-Navy game and freeze our butts off watching the game in early December. I just always had an inclination to water in terms of sailing and that type of thing.
My father's brother, however, had a lot of military service in the Army. He was an attorney in Brooklyn, always a very patriotic man. He was in the first World War and in the second World War and ended up as commanding officer of the Fighting 69th in the Pacific. As a matter of fact, he was killed there. Even with that background, I had no particular interest in going to West Point which, at the Naval Academy, we used to call, "Hell on the Hudson." I can't tell you, really, where that started. But my interests were always in the ships.
In January of 1943--I certainly was of age--I enlisted in the Navy and took the boot camp training. Later that year, I qualified for entry into the Navy V-12 program, which was an Officer Candidate type thing. I ended up going to Holy Cross in Worchester, Massachusetts for a year. I got an appointment to the Naval Academy, at that time. It was a Congressional appointment. All my college work had qualified me so I didn't need to take exams. I entered the Naval Academy in the summer of '44. I'd expected it would be a three-year course because they had shortened the curriculum during the war to get people out sooner. Our class was split. The upper half continued on the accelerated three-year course. I was in the accelerated program, and we got out in '47, although I am in the class of '48. A lot of us felt that if we were in the upper half of the class, that was the place to be because the attrition rate was fairly high. Following graduation, I spent active time in the Navy until 1954.
I think, at this point, I'll bring you up to date on my father's progress. He established a partnership with a man by the name of George Blake. It was Blake and CONROY, and they specialized in representing various factories--B.F. Goodrich and such people--and they were wholesalers. They specialized in children's toys and furniture. They would sell to people like Bloomingdales, Wanamaker's, and Strawbridge and Clothier. He made sales trips to all of these places. He was always very good with numbers, so he was really the business head of the organization. Really a better salesman than George Blake. As time went along--although things were tough during the '30s--he prospered, certainly during the war years. He stayed in this business until his partnership interest was bought out in the early '50s. He still lived in the same house, which was, more or less, an ancestral place. I think his father bought it, originally, in 1906. Eventually in the '30s, I think, he bought out his sister. She and her son moved out and we remained there. This is in Brooklyn. So I lived, essentially, nine years in Vermont and the next ten or so in Brooklyn.
Once my father left the partnership, he remained active. He had always been active in charitable things, and became fairly well known. As a result, he became a trustee on the board of directors of a Brooklyn bank. He was in charge of liquidity, buying and selling of bonds. He was very adept at this. He knew the stock market quite well. He was always very good at numbers. It was largely he who was responsible for helping me get into the cable TV business.
He lived in Brooklyn until 1956, when he and my mother moved up to a place in Stamford, Connecticut, where he stayed another ten years until 1975. He finally retired to Boca Raton, Florida. It was interesting that he became acquainted with Boca Raton because he was there for a bankers' convention. He became interested in the area, and ended up buying a condominium.
Following my graduation from the Academy, I had a variety of duties. I was on sea duty on different kinds of ships for six years. It is interesting that right at the present time, as we are having a lot of things going on in the Persian Gulf; my first duty was on a Navy tanker. We were often in and out of the Persian Gulf hauling oil to different ports in Europe, such as the port of Athens, which is Piraeus, or up in Naples. Sometimes we'd deliver to an oil depot north of Naples--a little town called Pozzuoli--which is famous, not so much as being an oil depot, as being the birthplace of Sophia Loren. Although I don't recall seeing her then, she would have been about twelve or thirteen, I guess. Sometimes, we hauled oil all the way back to Norfolk. That was usually on our final trip back. We'd make one more oil run to the Persian Gulf.
One time in August, 1947, the senior Navy captain in Bahrain said, "Okay, you've got it." They always wanted to have a naval presence there. So our captain was the senior officer present as the SOPA (Senior Officer Present Afloat) for two or three weeks. This was in August. It was a very, very hot time. I don't mean hot in war, but hot in weather. To the extent that once we got under way with a load of aviation gasoline, we had to keep hosing down the decks. If we didn't, it would get so hot the gasoline would vaporize and impose a danger. So we made a lot of trips in and out of the Suez Canal, and operated quite a bit with the Sixth Fleet in conjunction with their maneuvers. We did a lot of fueling at sea. This would have been '47 and '48. In 1948, all the trouble started breaking out in Palestine, and Israel was becoming a nation. We used to patrol up and down with the fleet about fifty miles off-shore of what was then Palestine. I never did see the coast and I never did get up to Rome. I remember one time I had a five-day pass to get up there, and then they called everybody back on board and over we went to the eastern Mediterranean.
During the ensuing time, I was on a sea plane tender, which wasn't very exciting duty. We had an admiral on board. He was Commander Training Command Atlantic. What was nice was that we spent a lot of time in the Caribbean visiting different islands for training purposes. I spent a lot of time at Guantanamo Bay, Cuba. Also, at the conclusion of my duty on the Albemarle--the sea plane tender--I took some submarine training at New London, Connecticut one summer, but did not continue in submarines. I would have liked to, but as good as I thought I was, technically, I wasn't quite up to what they wanted in submarines.
My next duty was on the battleship New Jersey. It discouraged me very much, at first, because I thought it was a floating hotel, and who wants that. But I ended up spending nearly three years on board the New Jersey. By the time it was over, I hated to leave. Not because it was so comfortable, but because the duty was so interesting. While I was on board, we made two trips to the Far East. We spent a lot of time off Korea, east and west coast, doing shore bombardment missions. I had duties in CIC, Combat Information Center, which is primarily radar. Then I was transferred to a deck division, a duty that I really liked. Deck and gunnery division, where for a while, I was turret officer of a 16-inch turret. During battle stations I was battle stations Officer of the Deck, which is very, very interesting because, under the captain, you are responsible for conning the ship. That means that you are responsible for the conduct of the ship and steering it. You are right up there where the action is.
I should have mentioned earlier that my duties in the Navy involved communications on the tanker and various administrative and gunnery duties on the other ships. On the New Jersey, as I've mentioned, my duties involved CIC and, also, deck and gunnery. I enjoyed it very much. During one period--I think our first tour to Korea--I spent some time ashore in Korea on a gunfire spotting mission, where we would direct the fire of the ship pretty far inland. Those 16-inch guns could shoot nearly twenty miles, so they needed some spotting. A Marine and I were ashore doing this work with a couple of our enlisted men. The Marine, incidentally, was Claude Kirk, who later became governor of Florida.
DUDLEY: Could we talk about hobbies and avocational interests? You mentioned sailing as a hobby when you were younger. What about up to college? Your avocational interests.
CONROY: Of course. At the Naval Academy sailing was not only a hobby, it was required. But even previous to that, I had mentioned that I liked to fish, and still do. I played various sports. Principally, I liked tennis. I was always too light for football, and I never cared much for basketball. But I liked tennis. I did different things in track. I also played baseball.
I always had an interest in music. When I was a real small kid--seven, eight, nine years old--Mother, who was quite an accomplished pianist, had seen to it in Vermont that I had taken lessons. When we moved to New York, we didn't have a piano for a few years. Music always seemed to have been a part of me and a part of my interests. Sometimes during my summers up in Vermont one of my uncles and I would listen to the radio at night, get good skip reception, and we'd listen to the different bands around the country. That must have been in the late '30s, around '37 or '38.
We heard what I thought was a very strange sound of music. I never heard of this kind of stuff before. It turned out it was boogie woogie and the music of the Black people. I thought, "Boy, that's a funny way to play the piano." So I followed up on that. I found out where some of the exponents of this style were playing. They were all Black people, and they played in clubs in Greenwich Village in New York. My father used to take me over there. In the meantime, I was buying their records, trying to imitate what I heard them do in New York, and what I heard them do on the records. By this time, we had a piano again so I was driving my mother crazy learning the various basses and other things that you play in that kind of music. My interest in that stayed from then on. Whenever there was a piano around, I'd try to get to it. I'd play the piano during lunch at Brooklyn College, and I'd take part in all the music programs. I did the same thing at the Naval Academy, although I never was in the band down there. Sometimes our ships had pianos, so I kept that up.
DUDLEY: Up through the end of the military service, you were not married?
CONROY: That's correct.
DUDLEY: Tell us about married life.
CONROY: All right. I'll complete my naval service. I didn't get married at all while I was in the Navy. My final year in the Navy, I was brought back to the Naval Academy for duty. I hoped to be in the Seamanship and Navigation Department, teaching. But I ended up having to go in the administrative or the executive department, which was really the white glove department in charge of administering and disciplining the midshipmen. I was responsible for a company of midshipmen. I would have preferred the other work because this was much more demanding. You had more duty hours, but that's the way it went. So I spent a year at the Naval Academy before resigning my commission. This will then lead us into the cable TV involvement. I'll cover that in a minute.
I didn't get married until 1956, after I'd already gotten into cable TV. The interesting thing was my brother had married a Brooklyn girl in 1951. I couldn't make the wedding. We were in Korea at that time. I had known the family. In fact, my brother's wife had come to know us because she was a friend of my sister. Just to make a longer story short, I ended up marrying the younger sister. So my brother and I are married to sisters, and have developed fifteen double cousins, at this point.
DUDLEY: Tell us more about your family and children. What are their ages?
CONROY: We were married in '56 in Brooklyn. Her name is Toni, Antoinette. I took her down to Uvalde. Of course, this was a much different environment for her, for a Brooklyn girl to move to a small Texas town. Uvalde was a town of probably nine thousand, maybe ten thousand people. Not only was it a small town with small town attitudes and mores, but it was a town in the southwest with a vastly different culture than what she was used to in Brooklyn. But she acclimated very well. In due course, over the time there, we produced six girls. We thought, "Well, it's just going to be girls from here on." When we moved to Austin in 1968, the final child was born, and he was a boy. He is Ben III. My father was Ben; I'm Ben. He, actually, should have been Ben IV, because a grandfather on my father's side was Ben. My father should have kept the "junior" but didn't, and I should have been Ben III, and my son Ben IV. But, I guess, in the long run, it doesn't make that much difference.
DUDLEY: For the record, will you give us the names?
CONROY: Yes. First one is Mary Katherine and she was born in 1956, so she is now about thirty. We call her Kate. She is an attorney. She's married and lives in Salt Lake City with her husband who is a doctor. The second one is Toni, Antoinette, Jr., and she was born in '58. She now lives in Houston with her husband who is in the oil business. They have one child, another on the way. I should have mentioned that Kate has two children. Of course, two daughters. Toni's child is a daughter. The third one is Patricia, Pat. She was born in 1960. You can see an even progression here. Pat is in business. She works at a resort out on Lake Travis. She is in sales, arranging conventions, meetings. She is getting married this coming October. Pat was born in 1960, so that makes her twenty-five or six now. The next one in line is Anne Therese who was born in '62. She has just completed law school at Trinity Law School in San Antonio and will be starting with a law firm in Fort Worth this summer. But she has to pass the Bar first. And the next one was Sloan who was born in '63. Sloan was named after my grandparents, whose name was Sloan. Sloan works at a savings and loan here in Austin. She is still single. Then we go to 1965. We skipped '64 for having children. We must have bought some appliances or something that year. At any rate, the final girl, our sixth girl, is Megan and she was born in Uvalde in 1965. Megan has worked at a variety of jobs and is just getting settled down here in a career in Austin. After we moved to Austin, Ben was born. Must have been the change in water or something. I was very, very surprised when the doctor came out and said, "Well, your son is doing fine." I said, "My what?"
Toni was well known in Uvalde and in the NCTA. If she wasn't with me on a trip, they'd say, "Well, is she again?" And I'd say, "She sure is. She's pregnant again."
DUDLEY: It appears to be time to start pulling together some things about how your father helped you get started in the cable business. How you ended up in Uvalde, Texas, instead of Brooklyn. Do you want to start pulling those threads together?
CONROY: Okay. Well, I wouldn't have ended up in Brooklyn anyway because, in the early days of cable, cable was only started in places that had problems with reception. I think I might have stayed in the Navy if I could have stayed on ships. In any case, I was ashore in Annapolis again that final summer of '54 and I had a 30-day leave. I participated, as a training officer, on a midshipmen cruise. It was on a destroyer. I had this 30-day leave and I was thinking, "Well, this is about the time I will decide if I'm going to be a twenty- or thirty-year man and stay in or get out. And if get out, do what?" So I used part of my leave time interviewing with different people in New York. I went back to Brooklyn and stayed with my folks during that month. I had made up a resume of sorts. As you can imagine, that resume showed that I was a qualified 16-inch turret officer, first division officer, qualified underway officer of the deck. Just what any civilian employer is looking for! So I really talked to quite a few people with not many results. I remember talking to the Texaco people; these were all leads that my father had given me. Texaco said, "We've got an opening over in West Africa at a little place that you might be interested in." I thought, "Well, no thanks."
Out on the beach one day, a fellow that I knew, not closely, was talking and visiting over at our cabana and he had some literature. He said, "This sounds kind of interesting." It was a folder from Jerrold Electronics, talking about community antenna television. He had a couple of them so I took one, looked at it, and brought it home and showed it to my father. He said, "What do you think about that?" I said, "I don't know. From the description of what's here and from what a friend told me, it just sounds like a big promotion business. Sounds almost like a hit-and-run. I don't know as I ought to get into something like that." However, I talked with my father further about it. Since Jerrold was located in Philadelphia, he said, "Let's call them and make an appointment and go on down there and see what this thing is all about." He called. We had an appointment with Milt Shapp. This was August of '54.
Of course, the cable business had hardly gotten started then. It was really in the earliest days. I guess Ed Parsons had done some experimental things in 1948. The end of '48 out in Astoria, Oregon. And '49 and '50--particularly in Pennsylvania, but in other places, too--found a lot of systems in little towns that were in valleys and remote from signals. They might be close to Philadelphia, but if they were in a valley, they couldn't get a signal. And they don't build little towns on tops of mountains.
So we went down to Philadelphia. We talked to Milt and a few of his people there, and got a much better idea of what this thing was all about. We talked about what it would take in terms of money to install one of these things. What it got down to was my father was willing to commit a certain amount for the investment. We'd have to figure what size town would support that kind of investment, or vice versa. They said, "We'll look around. We've got franchise proceedings pending in a number of places."
DUDLEY: This was Jerrold?
CONROY: This was Jerrold. They were going to look around, because we knew nothing about this. In fact, I've got some correspondence from those days saying, "We recommend Uvalde." In any case, I remember Milt asking me, "Where do you think you'd like to settle?" And, again, I was still in the Navy. I was a lieutenant in the Navy. I said, "Well, I prefer not to be in cold climates. I don't want to have heavy winter all the time." He said, "That's interesting. One of the places we're looking at is Bemidji, Minnesota." I said, "No, no." Milt said, "We'll keep looking around."
I decided this sounded interesting enough for me to do ... this field. So when I went back to the Naval Academy from my leave, I prepared a letter of resignation and submitted it. Of course, this wasn't received too well by the superintendent of the Academy. Here you are on the training ground for future admirals and one of the training officers is leaving the Navy. Immediately they transferred me out of my duties as a company officer, and I was given a make-work kind of job over at the admiral's headquarters.
In the meantime, Jerrold was investigating properties and they eventually recommended Uvalde, Texas. They wrote a letter outlining its characteristics. It was a town that would support the type of investment that we could make. I had no money at that time. I think probably even as a lieutenant I wasn't making much more than about $5,000 a year at that time. I had little savings, nor did I have any credit with which I could do it myself. So my father helped me along. I did resign from the Navy. It became effective on my birthday, October 28, 1954. I came home. I guess I had a month without an awful lot to do. This was the time during which Jerrold was looking around.
The end of November or early December, I went down to Jerrold to attend a two-week schooling, spending time with their people. How do you manage one of these things? Learning something about the engineering of it. I'd had no business training whatsoever. I didn't know anything about accounting. During the course of working with Jerrold down there, they suggested it might be helpful if I actually went out and saw one of these things. So I made a trip down to Clarksburg, West Virginia, one of the systems that Jerrold had a part-ownership in. They didn't own it, but they were partners in it. Sandford Randolph was the manager. At Jerrold, they thought a lot about Sandford. They said, "He's one of the best there is. Sandford always does everything right." So they said, "He's a good man for you to see."
I spent several days with Sandford down there and visited his headend, and talked with his technicians, and spent a lot of time with him in the office on procedures, customers, customer forms, and the whole bit that you go through. Thinking back years later, I don't know how many people Jerrold trooped through down there, but Sandford must have had an awful lot of young guys coming through to learn about the business.
Following on the heels of that, I went to Williamsport, Pennsylvania, and Ray Schneider managed there. At the time, Williamsport was probably the biggest system in the country. Probably had under 10,000 customers, but it was still pretty big. I went through the same thing. I spent time with Ray. I went up on the mountain and looked at the headend and followed the lines down. I talked to his people. The interesting thing about Williamsport was that, toward the end of my cable career, I was in a company that owned Williamsport. Williamsport was an interesting town because it was big enough that there are always two or three systems at a time going on there. They'd get consolidated, and then somebody would start up another one. Fred Lieberman bought it from Milt Shapp back in the late '60s. Lieberman joined our group and we ended up owning Williamsport.
Our involvement in Uvalde with Jerrold was what Jerrold termed an equity system. What that meant was, simply, that we put up all the money and they had some equity. In fact, it was a 51/49 situation. They owned 49 percent. They didn't have to put up anything, and we did.
DUDLEY: Now was this true of Clarksburg and Williamsport also? I think they had the name Jerrold in those systems for a while.
CONROY: Yes, but Jerrold did not by any means own all of them. A lot of them were owned by investment houses. J.H. Whitney, I think, was an owner of, for instance, Williamsport. I forget who was an owner in Clarksburg. Maybe somebody like Fox Wells. Goldman Sachs, possibly. So I think that Jerrold probably didn't have a lot of money. They had the equipment and, supposedly, the know-how, although sometimes we wondered if they really had that all the way.
I would suspect that they had started all of these things out on an equity basis to where they came into ownership, supplied expertise. You bought the equipment. But they ended up with some of the equity. Usually a minority position. I don't know if it was always 49 percent or whether they got 49 percent of us because we were neophytes. Jerrold also, at that time, had a contract with operators and possibly with anyone who bought their equipment, whereby you paid them so much a month for each subscriber. Twenty-five cents and you have to buy all of your equipment just from Jerrold. This got to be known as the Jerrold "Yellow Dog Contract." I think, eventually, there was an anti-trust action brought against them by the Justice Department in '56 or '57. They had to abandon that. So we ceased paying anything to Jerrold on that basis.
End Tape 1, Side A
DUDLEY: We were talking about your experiences with Jerrold and the service contracts. Can you tell us a bit more about that service contract and what it provided?
CONROY: Ostensibly, it provided Jerrold's advice and some engineering time. I haven't retained a copy so I can't tell you. But with that went a certain amount of free engineering time. And, of course, a lot of that time was used up at the inauguration of--the building of--the system. After you'd exhausted your free engineering time, you'd pay the engineers' travel and other rates. I don't think we were charged for visits to the system by management people.
Jerrold had some very good people. They called it their community operations department. Bill Miller headed the thing up, at that time. He was interested in a number of systems. Jerrold had quite a few of these equity types. One example was Berlin, New Hampshire. Another was Pocatello, Idaho. And I think they had one in Flagstaff, Arizona. All of these had started about the same time. Bill Miller made a trip, one time, to Berlin, and his plane made a crash landing. Bill was never quite the same after that. I think he got pretty badly hurt. Within a few years he died.
Another person in that department was a lady who I remember, Claire Ostroff, who later became Claire Bloom. She worked under Bill and worked directly with the managers. We sent our weekly reports to Claire.
Bob Tarlton was working with them, at the time. He was their construction expert. Bob was responsible for drawing up a bill of materials. It was Bob who would provide for field engineers to go out. To build a system, initially, you'd have to make a design of the system and map it out. In the old days to do that you'd walk the poles. Today, you do it with trucks. Back then, you'd walk it with a wheel to get the exact footage between each pole span. Generally, you would try to follow an existing distribution system, usually the power system. You'd have to go where the poles were, but you'd follow a distribution system much the same as the power company did. But you'd have to start at your headend.
Let me pause for a moment. We were talking about the service contract. That's really about all that I remember about it, except we did have a monthly charge for a while. With this, Jerrold not only provided engineering services, but they gave advertising and promotional help, too. They'd give promotion aids. That part was kind of a turn-key thing, although we didn't build the system on a turn-key basis.
DUDLEY: Caywood Cooley. Were you involved with Cooley?
CONROY: Yes, I was. Not in the beginning. But later on in our operations. It might be better if I came to him a little further along.
DUDLEY: You're now in Uvalde, Texas. Or about to go there.
CONROY: I went down there in January. I drove down in January '55. The first appearances before the city council had been made by Jerrold. It was called Jerrold Southwest, and Jerrold's manager, at that time, was a man named Lee Green. They were based in Dallas. The engineer was a fellow named Herm Roeder. Lee Green appeared before the council. When I got there the franchise proceeding had been started, but it took three readings. I think the third reading might have been in February. I was only there for the final reading.
One provision in the franchise related to the airport. The city council was afraid the tower--which, incidentally, had already been put up--would interfere with operations of the little municipal airport. When I got there, there was that tower, all four hundred feet of it. They had hopes of getting a larger airline with regular operations in there.
Trans Texas Airlines, which exists today as Texas Air, and all of its subsidiaries--we used to call it Tree Top Airlines, TTA--had been going in there but had pulled out because they were averaging only three-quarters of a passenger a day. However, the city wanted to have a facility that could adapt itself to having airline passengers. The airfield was built during the war as a training place for pilots. A bigger one was in Hondo, somewhat east of Uvalde. So we had to agree that if the tower ever became a detriment to establishing a good airline service, we would move the tower.
It's ironic because we ended up moving the tower but it was for engineering reasons, not for reasons of the city council. But that was one of the provisions that had to be in the original franchise.
DUDLEY: What was Uvalde like at that time? Population and terrain. Give us a picture of why that community was selected.
CONROY: Uvalde was roughly ninety miles west of San Antonio and, therefore, was getting spotty reception. This was one of a number of towns that Jerrold had under consideration. For a variety of reasons, they felt the economy was quite good. We did not take into account--which gave us problems later on--that it was a split population. Really, half the town was Mexican-American. So while it may have been a town of nine thousand or ten thousand, it really had the purchasing power of a town of six thousand. This explains some later problems that we had.
At that time, that part of Texas was in very severe drought conditions. The economy there was mainly farming and ranching. When you have a drought condition, everything dries up. If you're a rancher, you don't have any grass for the cattle to eat and you have to feed them. You have to buy feed. A lot of ranchers went broke. It was, however, a good time for the irrigating farmers, not for the dry-land farmers, but there was a lot of irrigation farming there. They prospered because they could make their own "rain." They had water when they needed it.
So it was a split kind of economy. It was tough going for a lot of people. The Mexican-Americans were not by any means a high-income group. Typically, whole families would leave in the spring to go north to work in beet fields or sheep shearing. They'd come back in October or so. They had dollars in their pockets then and would be able to have a little spending money. Much of the year they just weren't there. When they were there, they just didn't want to work much. They had the money they got from working up north. This is not to say that the whole population did that, but this was typical of many. The buying power was very low. As a result, once we got the system going, our penetration into the Latin areas was very low until we were able to bring in a Spanish-speaking channel. We'll talk a little more about that in due course.
DUDLEY: But when you first fired up Uvalde, you were basically bringing in San Antonio broadcast stations?
CONROY: We were bringing in two stations. Two. Our system used what was then the most up-to-date equipment, which means we provided a total of three channels. These were Jerrold strip systems. A few years later, they came out with broadband, low broadband, which provided five channels. We used their W line, as they called it. WMC-5 amplifiers. You could carry only the three channels.
DUDLEY: These were one or two steps removed from their apartment amplifier.
CONROY: That's correct. Although I think apartment amplifiers were strip also. I'm not sure, but I think it was a modification.
DUDLEY: After Uvalde got up and running, was that mainly your cable system or your involvement in cable? You got involved in a number of other systems.
CONROY: I think I should bring you a little bit along in Uvalde, because it was a while later on before I got involved in other systems.
I've mentioned the drought conditions there. This affected the whole area. It was at this time that I met Jack Crosby. Jack was a native of Del Rio. His father ran a hardware store. I think it was Rust Hardware, and Jack used to work there. His father was also a Texaco consignee, so he was distributing gasoline in that area. To this day, Jack still uses a Texaco card. I got to know him simply because of timing. We started construction in Uvalde in April of that year (1955).
Jack had gotten interested in this business. Consider that Del Rio is seventy miles west of Uvalde, which means it was one hundred fifty or one hundred sixty miles from San Antonio stations. Jack had an awful time once he got up and going because he was showing only a better grade of snow than what the people could get. I know Jack was restless. He'd walk up and down the hardware store and say, "We'd better do something." Our system was inaugurated in June of '55, and Jack's came on the air in September of '55.
At that time, there were several other systems starting up around our part of Texas. As an example, in a town called Brady. A man named John Threadgill. John is dead now. John and his wife ran a jewelry shop. See, everybody who got in this business did something else. There was always some opportunity that came along and they said, "We'll take a flyer on this thing."
DUDLEY: Was Crosby selling TV sets in his hardware store?
CONROY: He probably was. Although I don't know how many because you couldn't receive anything out there. It was a hardware/appliance store. I've said "hardware," and it was more of an "appliance" store, refrigerators, washers, and that type of thing. Once I got to know Jack, he'd come over to Uvalde, and I'd go over to see him. And our families got friendly. We'd go over across the river. There's a restaurant in Cuidad Acuna, called Mrs. Crosby's (no relation to Jack) where we went to eat, but it was a good restaurant. We did a lot of visiting back and forth.
There was another fellow named Oscar Kost from Ozona, Texas, not far from Brady, in central Texas. Oscar was a leather worker. He made shoes and other things. He got into partnership with about eleven or twelve people, and they each put up a certain amount of money, $5,000 or $10,000, and they built their system in Ozona.
John Threadgill was in partnership with a bunch of people. Of course, John was the guy who ran his system. Oscar was the guy who ran his system. Each of these people, once they got a system up and going, wanted to be rid of their partners because they wanted to be able to run it themselves. But they still had to be responsible to these people. As far as I know, even to this day, Oscar still owns that system and still has those partners. One is a motel owner.
Another system close by Ozona was Sonora. These are all pretty small towns. Sonora probably had three thousand people at that time. It was strictly a ranching community. They raised sheep and goats up there. It's rocky country. Two people owned that, Jack Mackey, who ran a hardware store, and Edwin Sawyer, a rancher originally from Maine. They used to go back to Maine every summer, but he and his wife live in Sonora year round except for vacations in Maine. We got friendly, particularly with this Sonora group, in a social way.
During the winter the ranchers would shear mohair from the goats and wool from the sheep. They'd sell it in the spring--March or April. Then they'd clean out the big warehouse used to store the wool and mohair. There would still be wool on the floor. They'd get big name bands down there and have what was called a Fling Ding. They'd invite people from miles around. They had Tex Beneke and so on. They had lots and lots of people. We got invited. We'd spend the night up there with the Sawyers.
So we began to get acquainted with a lot of these people just through cable operation because we had a lot in common. I was different from a lot of them. I was solely cable, and they had a lot of other pursuits. Cable was something that looked pretty good to them.
I probably should back up a little here because you mentioned something before about financing this thing.
Initially, Jerrold had estimated it would take about $70,000 to do Uvalde. They had figured so many homes, therefore, so many miles of plant, and so much a mile for plant. It cost about $2,000 or $3,000 a mile, in those days, to do this, if you figure it on an overall basis. Jerrold had figured eastern figures. They had figured one hundred or one hundred thirty-five homes a mile. That's all right for a Pennsylvania town, but for a west Texas town we had fifty to sixty to seventy homes a mile. So it ended up that we had to put in many more miles of plant than Jerrold had estimated. By our agreement with Jerrold, we put up the initial $70 and then would put up another $14 if needed. That was part of the deal. Jerrold had underestimated this thing and there were some other problems, which I don't mind relating. They admitted ... Bill Miller wrote a letter saying, "Well, yes, this is our fault here. We applied figures for eastern towns and did not take into consideration what exists out there." We found out how many miles of plant we'd need by walking the poles.
This began to get underway in February when I went there. I'm not going to try to bring you month-by-month, just the typical start of a system in those days. When I'd gotten down there, Lee Green, who was Jerrold's manager in the southwest, had been in touch with a man named Faber Spires. Faber ran a TV repair shop. He was a very good electronics man. I guess he'd spent time in the Army Air Corps Air Force during the war and had worked in communications. He had his repair shop. They tentatively agreed he would come with the company. When I got down there, met Faber and talked with him, he decided, "Yeah, I will come with the company." I think we both started off, in those days, at a hundred dollars a week. That was the agreed thing, which was probably about equivalent to my Navy salary at the time when I left.
Faber went out with Jerrold's man and actually walked the poles. He would take one of these wheels and you'd make strand maps. Typically, you would go to the power company and get power company maps. I don't know if the phone company was helpful in providing them or whether their maps weren't useful to us. Typically, we'd go to the power company which, in this case, was Central Power and Light. So you drove to wherever you were situating your tower and branched out from there. In those days, your headend was at the tower. These days, if you have a tower at all, your headend is much more centrally located. Eventually, we did this at Uvalde.
So you strike out from the headend, going pole-by-pole over the whole town. Once you did that, then you'd begin to lay out the electronics part and determine what size cable you should use and so forth. In those days, it was, of course, regular military-type coaxial cable. A typical feeder would be designated as trunk cable RG-11, which is a little bigger, and the feeder was RG-6, about the size of today's drop cable. The losses were pretty high. The biggest cable we used was for long trunk runs, runs to town. I forget the designation. In Times Wire it was called XE101A but it was ... K14 military cable. It was big, thick stuff, terribly hard to splice, very heavy. When you lashed that with strand onto a pole, if your span was three hundred or four hundred feet, my Lord, you would be dipping way down onto fence tops. So we had some of that, but that, typically, is the way it got going. It was a physical thing, you just had to walk it, and that took a little while.
So then these maps would go back to Bob Tarlton and Jerrold, and Bob would lay out the system. They laid it out in pieces. That is, we didn't wait till the whole thing was laid out, we would lay out from the tower to this section to this section, so that bit by bit we began to get our electronics and cable requirements together. By that time, too, they had contracted with a contractor up in, I think, Abilene, Texas. From our point of view it was sort of turn-key but we didn't give it to any one man and say, "Build us a system." Jerrold was essentially responsible for doing all of it, so in that sense, it might have been turn-key.
We actually began construction in April and opened up in June. Of course, you don't open up a whole town at one time, so we generated publicity which said, "Here's when we expect each section of town to open up." We did have our grand opening in June. Later I can show you some pictures of what the pictures on the TV looked like.
We had problems out on our antenna site. We were pretty close to a 135,000-volt line, probably a couple of hundred yards. In the hot, dry weather, that would emit a lot of power noise, which appeared as specks on the picture. It would even come through to the audio. Because we were fairly remote, other channel fours and fives, from, say, down the Rio Grande Valley or from Dallas, or eventually even from Florida, would come in when we had particular weather conditions to create co-channel interference. I always watched the weather because you saw on the weather map on TV when an occluded front was coming. I thought, "Oh my Lord, here comes the co-channel." It was worse in the spring because that's when all the storms would be coming in--spring storms. The phone used to ring off the hook. "We're supposed to get perfect reception here! This is just like our old antennas. What are you doing about it?" I used to tell them, "I'm praying!" And, "Will you join me in a prayer?"
DUDLEY: What would people pay to connect? And what were the monthly costs?
CONROY: Our connection charge was $125. Our monthly charge was $4.00. To that had to be added an 8 percent excise tax. So that made it $135 and $4.32 a month. If I were doing it again, I would not use that rate structure at all. I would have a very, very low connection charge, and a much higher monthly rate, which is what I did in later systems.
This was a detriment; you didn't always collect that $135. For the people that I did collect it from, I had an agreement with the bank where I could sell them the note, but it was with recourse. Jerrold's people said, "Go to the bank and get it without recourse." Well, I had to find out what recourse meant, because I had no business background. I finally found out what with or without recourse meant, but the bank wouldn't do it without recourse. If somebody defaulted on a note, we would have to pay. So they would be paying monthly fees to the bank and monthly fees to us.
DUDLEY: Some of the earlier systems needed that $135 because that was their capital fee for the cable, but in your case, you didn't.
CONROY: That's right. Well, we needed it, we really did, because as we went along, we got in arrears with Jerrold in payment for equipment. But it is true, a lot of the early systems would get so many connections and then they could build so many more hundred feet of cable. That's correct. In theory, we didn't need it. This wasn't a quick sell. It's a quicker sale today. I think we're better salesmen today; we've got more product. But then we had to persuade people, entice them. We had to take antennas in trade, and I didn't want those damn antennas. That's the last thing I wanted. We had to use all kinds of screwy promotions.
DUDLEY: People were not clamoring to get attached to the cable?
CONROY: A good many people were, but the $135 was a detriment. It was a barrier. Eventually, we went to two other rate structures; we had three rate structures going. We introduced a rate of $8.95 and a $10.00 connection charge. Well, we started to get a bunch there but a lot of people thought $8.95 was too high. So we came along with $30 and $5.95. We had the damndest, screwiest rate structure that you've even seen.
This occurred after some events that I'll tell you about because, eventually, we bought Jerrold out. We didn't buy them out; they just went out. We ended up owing Jerrold. We owed them on equipment; we owed them on cable; and we didn't have the money to pay for any of it. The first full year of business, we got three hundred customers, and you can figure on $4.00 a month, that's not a lot of monthly revenue. So we were in the hole. But Jerrold, at that time--this was '57, '58--needed cash. They had some other things going and they were in a cash bind.
Well, I need to tell you, too, about my father. He was retired but he was busy with his banking business, and he kept right on top of this thing. He knew more about finance than I did. That box down there (points to box), you see, is just letters from my father to me. I'd get one every couple of weeks, long letters, and he'd talk about particular things, asking about problems and commenting about my letters to him. "What does this mean?" I knew more about the technical part of the business, but in terms of the balance sheets and all of that, he knew much more than I. I've caught up with it but then I was a real neophyte. In fact, when I went to Uvalde, I enrolled in the Southwest Texas Junior College; I took some courses in accounting so I could understand what the businessmen were talking about. I also took some Spanish so I could understand what people were saying. My first employee, the lady I had in the office, was an Anglo lady and we became very good friends. As time went along, I got Spanish-speaking people in my operation.
DUDLEY: Could we pursue that line? Your employees. Could we talk about your installers, your business people, and so forth?
CONROY: Yes, sure. I've already mentioned Faber Spires. He was designated chief technician. Once we began to get close to the opening, which was in June, we bought a couple of trucks and took on another technician under Faber. This fellow had worked with the highway department. He was an Anglo fellow, and he was very good with electronics, one of these electronics nuts, you know. We had a couple of people like that. In the beginning, I think we only had two employees, aside from Faber. Their duties were to maintain the system, go around and balance the amplifiers when needed, go out on trouble calls, and also do hookups.
So, it was difficult to keep them on a forty-hour week. There was a lot of overtime because, if we had a problem at night, we went out. In fact, Faber used to make drops, hookups, and I used to make them with Faber. I was a "grunt." That is, Faber would climb the pole and I would be down below, or I'd go in the house and skin the cable back and get the transformer ready, and so on. Because we wanted every connection we could get, Faber would say, "Well, we'd be open Saturday mornings and closed in the afternoon." But then we'd get some Saturday connections, "Well, I want it today. Can we get it?" We'd go out and we'd do it that day.
I've made a few drops. I've never made it from the pole though; I never was a pole climber. Although one time, in a very foolhardy frame of mind, I did climb that 400-foot tower, from the inside. I tell you, I'm glad that I did because I got an insight that I wouldn't have had otherwise. You physically have to pull yourself up with your arms because the members of the tower, the frame, are about three and one half feet apart. From that one experience, I got a very good insight into what it was to work up on top of that tower and have to install antennas or go up to change out a preamplifier. Everyone said I was crazy, "You don't have to do that." I said, "I want to do it." So I did go up. In later years, we had lifts installed to go up there. I think it was a good thing to do simply because I knew what the technicians had to do. Not only to get up there, and rest after they get up, but then to work.
DUDLEY: And there was a pre-amp for every channel?
CONROY: That's right. At the top of the tower. It was tube operated, and tubes burn out.
DUDLEY: Selling. Who did your selling for you? Were you actively involved in the selling? Knocking on doors?
CONROY: I was. Yes, I did. We didn't have a staff; I was the staff. In those days in a small system, you were the manager and you were the PR guy with the customers. I used to make up the ads and bring them around to the newspapers, and I learned how to do it pretty well. I also went door to door.
One of the first things I did was to take a yellow pad and go around and note the address of all the antennas in town, because they represented my immediate, potential customers right there. Of course, once we started, a lot of people who had been holding off bought sets. Sometimes the antenna was good, but a lot of the time it was terrible.
DUDLEY: Did you ever get into retail business? Television sets?
CONROY: No, because the people I wanted to have on my side and help me sell cable were the dealers. I didn't want to compete with them. One of the first things I did in town was to have a meeting of the dealers to explain cable. In fact, I made appearances before all the service clubs and joined one of them. First thing I did, under Jerrold's advice, was have a meeting with the dealers. I had the newspaper people there and a radio guy to explain what the system was. I said, "I am not in the TV set business. You are. I'm here to help you sell TV sets." I arranged tie-in promotions with the dealers. If they would sell the set, and sell cable with it, I would give them a kickback. I don't remember, $10 or something like that.
But, no, I didn't want to sell or service TVs. I know the early guys did because they were the guys who put in the system. Jack Mackey in Sonora was a TV dealer. He might have been the only one in town. But no, I did not want to sell TVs; I had enough problems with cable and maintaining the peoples' good will.
DUDLEY: You've mentioned the power company. How were your relations with the power company. What about pole rates?
CONROY: Okay. Relations with the power and the telephone, particularly the power, were good. The contract that we got with the power company called for a dollar and a half a year, per pole. We had no restrictions on what we could do. They did require a bond and a certain amount of liability insurance. We got good cooperation from the power people, even to the extent of that noisy power line north of town that I was telling you about. They would try to knock down a lot of their insulators, and so on, and try to help us with our power-noise problems.
Part of the process of building a system was once you laid the thing out, you'd check pole-by-pole with a power company engineer and a telephone company engineer. A lot of the poles were shared jointly by telephone and power. Power was always up on top; they had taller poles. If a phone company owned its pole and it was the only one on the pole, it would tend to be a short pole, a 30-foot pole, even 25-foot. After going through there with the telephone company engineer--I was the one doing this because Faber was doing other things--the engineer would say, "That pole's got to be changed out." And that's where our pole line rearrangement costs would come in. He'd say, "We can lower our phone cable there." And that would be a cost. When I'd go out with the power company, we might hit a pole that had all kinds of crap on it--the transformers and everything else. It was on the corner and it had two sets of primaries and secondary and they'd say, "We've got to change that one now." I'd think to myself, "Oh, shit, there goes $300 right there." I'd say, "Well, can't you do this?" They would say, "Oh, not with that bank of transformers there." So, that would have to be changed. I did this with the power engineer and the telephone engineer. I always wanted to go out together with both of them but I couldn't quite manage it.
So I learned the system that way. That system I really knew because I had been out doing it, and I knew where the trouble places were. Sometimes Faber would go out if he had time, but he was busy learning the equipment, working with Herm Roeder on balancing it out. And, of course, we had a workshop. Faber knew how to operate a scope, and you'd line up your amplifiers on those scopes.
DUDLEY: With the changes in the daytime to nighttime temperatures, did you have to re-balance the system?
CONROY: No. I know a lot did. Our amplifiers weren't that sensitive; they had automatic gain controls. But when the warm weather in the spring came, and the cool weather in the fall came, we had to go around again and completely balance. But Faber tried preventive measures. You could tell from your readings if something is going wrong. He'd hook up somebody's house and they'd look at the Channel 4 reading. I think we started on Channels 4 and 5. Two channels. Later when we got another channel, we carried it on Channel 2. But you could tell from your readings if things weren't exactly right, if the readings were off the normal levels. So he'd go out and check the amplifiers. But we didn't do it every day because the equipment was better than that. This equipment had automatic gain control. That was that fourth strip on the amplifier.
DUDLEY: We still are talking about tube, AC powered?
CONROY: Oh, yes, absolutely. And that power bill got pretty big.
DUDLEY: So, in addition to the buck and a half a year for being on the pole, you were also paying power.
CONROY: Absolutely. One other thing on the telephone contract. They were a dollar and a half a year with us, at that time, and had the same kind of bonding and liability insurance. They also had language in there which I guess we felt was innocuous, but it provided that the contract was basically designed to facilitate use of off-air signals.
DUDLEY: Were they looking into the future?
CONROY: Oh, I think they were. I think there is not a question about that, particularly in later years when I was negotiating with telephone people. I heard them say more than once, "We wish we had never given the first pole line contract." But they did have that kind of language in there. Both the phone and the power company were very particular about what was done on their poles.
The phone company, Southwestern Bell, had a bad experience down in Victoria, Texas. A company owned by Mid-West Video put a system in there just before Uvalde and, apparently, did a bad job and antagonized the phone company. The district engineer let me know right away. He said, "We're not going to have any of that God damn stuff that you people put in down in Victoria. You're going to have a model plant here." His name was George Pomeroy, and when it was all over, I got very friendly with him. I said, "George, you were certainly on my ass in those early days, but I think we did put up a good system." He said, "You have a model plant here."
End of Tape 1, Side B
DUDLEY: We talked about the business of getting business in Uvalde. Tell us about some of the lighter moments and the Yankee coming south.
CONROY: Well, I was indeed a Yankee, and my voice intonations certainly weren't Texan. They still aren't, my children's are. In the beginning I didn't really consider that a problem. I became aware of a potential problem only in the sense that I heard myself referred to as "that Yankee" and so forth. I was fortunate in getting acquainted right away with a man whose land we rented for the towers. A dear friend, gone now, named Farrel Warren. He was a real old-time Texan who had been a rancher. He actually took me in hand and showed me around town. He introduced me to the mayor. He was my first very good friend. He had about a square mile of land that he leased for agriculture.
It was through him that I began to meet people and I met the newspaper fellow whom I started to get very friendly with. He helped me a great deal. I was fortunate in getting to know some of whatever would pass for "movers and shakers" there. I was a bachelor, and I dated some of their daughters. I remember one time, in particular. I was invited to a party and they had set up something for this Yankee that they called a Snipe Hunt. Well, I had heard about these things before but I thought, I'm going to go along with this thing. So they were building this up and telling me all about it. How you go out at night and you hold this sack and a flashlight and the snipe comes running into it. I thought, well, let them have some fun. So I did it. Supposedly, you go out there and they leave you in a pasture. They brought me out there and, supposedly, they were going to drive the snipes in. I roughly knew where I was, I was out someplace. So I walked back to the ranch house. In the meantime they had gone out looking for me and they couldn't find me. I turned up at the ranch house and said, "Well, none of those things seemed to come along, so I thought I had just better get back here." Well, there was a big write-up in the paper, and they even had me pose with the sack.
I think that those little kinds of things helped. I was friendly with the editor. Every so often he had a column called, "Homer Hometown." There would be something about Ben Conroy and I got to meet quite a few people in the service clubs. I joined one of them. I joined the country club. It cost all of seven dollars a month to belong. I thought, "Well, I can do that." I met a lot of people out there. As time went along, they would call me "Yankee" but that was that. We would get along. I would go out on fishing trips with them.
One thing that I did enjoy was that Uvalde was the hometown of John Nance Garner. He was a Speaker of the House of Representatives and Franklin Roosevelt's vice president for two terms. He broke with Roosevelt over the third term and came back home to Uvalde. I guess he was in his eighties by that time. Harry Hornby, my newspaper friend, was a good friend of Mr. Garner. John Garner had a son, Tully, who was in his sixties and whom I liked a lot better; John Garner could be kind of mean.
We'd go over to Garner's about 5:00 p.m. some days and, as they would call it, "Strike a blow for liberty." I think Garner was still drinking in those days. He'd quit smoking cigars. He'd break his bottle of Jack Daniels out of the ice box and say, "Well, let's strike a blow." And we'd chat. He'd talk some about the older days and he'd want to know when this cable was going to get in here. When it finally got in, he was one of my first customers. He bought two sets, he wanted two connections, so we split a connection. We had two channels, so he wanted a set for each channel. We had a picture taken of him watching Dave Garroway and I sent it up to NBC to Dave Garroway. We got a letter back from him saying, "Glad to see Mr. Garner watching."
Of course, during construction all sorts of funny things happen and they're not very funny, at the time. There was a fellow named Asher, and I remember very clearly the corner where he lived in Uvalde. The construction crew had to set a pole or dig an anchor, I guess. Well, they went down through his sewer line. He came storming into the office. He was a big guy who raised and trained horses. "Your God damn people have flooded my house." And this and that. So I went out there with him and I said, "Boy, we sure made a mess, didn't we?" So I said, "We'll clean it up." Of course, it was the construction crew's fault so I said, "Let's get the sewer line repaired and we'll pay for it. I'm sorry about all of this." I later got to be good friends with him.
There's something else that gave Jerrold a big kick. They used to use a sealant, a weather-proofing compound called duct seal. Apparently, they had great success with it in the east and north. You'd put this over connections to keep them waterproof. Well, Uvalde was a great bee area. People kept bees to produce honey. Uvalde honey is well known in that part of the country. Somehow, there must be something in that duct seal that appealed to the bees. They would come up on this duct seal and they'd strip the stuff right off. We wrote to Jerrold and asked how to keep the bees off the duct seal. Eventually, we used a silicon grease. The duct seal wasn't of much use.
A little further on in the business, after we had a third channel, another peril that we had there that I don't think they would have had in the east was buzzards. We used to have buzzards come on top of our tower and roost on the antennas. Now these are big, old birds. They'd end up bending our antenna elements. We had to figure how to get the buzzards away from our tower. Faber came up with an idea. He said, "You know, if we could pipe some sound up there, maybe we could scare them off." So we found somebody who had an old Navy speaker. Faber ran an audio wire up to the top and we put up the speaker. It was an all-weather type thing, and we hooked it to the audio of Channel 12, San Antonio, which came in around '58. It was our third channel, the ABC outlet. We ran Channel 12's sound up there. Well, that tended to scare them and frighten the buzzards off, so there was an article in our paper about Channel 12 scaring off the birds and antennas weren't for the birds. I sent a copy of this to Channel 12, and I'll be damned if it didn't go out on an AP newswire. "Channel 12 sound, scaring off the buzzards."
A couple more words about promotion. It was a constant thing. Of course, we had promotions at different times of the year, but we had to gear our promotions to the people. I remember trying to get Mexican-Americans to hook on. We ran a chicken promotion, one time, because they all raised chickens in their backyards. I said in the paper, "You bring in your chicken all dressed, and we'll allow you so much on a connection for that." We had a box there, a big box full of chickens, and we donated it to some charity. Some promotions were original, some came from Jerrold, and some came from the NCTA. Something that was always popular around Christmas time was toys. Bring in a usable toy which we will donate to the Kiwanis Club for their Christmas project, and we'll give you a free hook-up. That was the $9.95 hook-up thing.
We always had tie-ins with the dealers. Sometimes we would send a note out to our charter, original subscribers, saying that they would qualify for so much free service if they would bring in a friend. Anything to get people in. There weren't people flocking to the door, by any means. We added on about three hundred a year pretty evenly as we went. We didn't really crack that Mexican-American market until we were able to bring in Channel 41 by microwave from San Antonio in 1960-61. That's a Spanish language channel.
Jack Crosby's reception in Del Rio was so bad that he had to do something. He was over in Uvalde a lot and I would go out with him. We'd go east to some of the hills around Uvalde with a Jerrold engineer and look at signal with a view to microwaving TV signals from Uvalde to Del Rio. Ultimately, we had to move our tower. That power line noise was intolerable.
This is the time that Caywood Cooley spent a great deal of time in Uvalde. This was probably around '58 or so. We got permission from a rancher named Kennedy, who had a pretty good looking bunch of hills out there, and we went out with small antennas and a tent and a small TV set and a meter. A field strength meter and a power generator. You know, you have to have power. We'd spend whole afternoons out there. Caywood christened the hill we were on "Jim Beam Hill" because I would bring a bottle of Jim Beam and a container of water. We'd sip on that and look at pictures and take notes. He was there for nearly a week, at one time, and we were just monitoring signals, trying to determine if this was going to be good enough. At other times, when we were putting up towers at different places, we rented an airplane. We'd go to different levels and see what the signals were. The only problem was to be sure the signal you were getting was not the sparkplug through the airplane putting noise into your signal!
DUDLEY: Did you and Jack Crosby eventually interconnect your systems?
CONROY: Not interconnect where the signals went back and forth. Eventually, Jack did establish Southwest Texas Transmission Company, which was a microwave common carrier. He brought pictures from Uvalde to Del Rio. At the time we moved our tower, he put up a microwave tower and we shared expenses. In fact, he shared the expense of putting up an even taller tower when we went to the new site. He paid part of our power and he had space in our shack and he'd put in microwave. So he was getting pictures at least as good as we got in Uvalde. Ours weren't always that good because we would still get co-channel interference.
DUDLEY: What was the next step after Uvalde? You had systems in a number of different states. Did they all come out of Uvalde?
CONROY: You see, my father and I eventually bought out Jerrold. I referred to that before, but in buying out we owed Jerrold about $35,000 and they needed cash. My father went down to see Milt Shapp and made a deal where I think he paid him $28 or $30,000. It was just money we owed for their equipment. In return, we got the 49 percent back. Basically, we paid what we owed and we got the forty-nine. We ended up sole owners.
The system really didn't turn the corner, in terms of being profitable, until around 1959 or 1960. At that time, my father had always kind of regarded this as a family-type enterprise. I ended up with 51 percent and he spread some stock to my brother and sister. So he and my brother and sister were shareholders and I had 51 percent. My father knew I was interested in expanding. We talked about possibly using Uvalde as a basis for establishing other things. We were beginning to get offers from different people, including Jack Crosby. He wanted to buy the system. He was always after me for that. I really wanted to go out and do it on my own and I felt a little inhibited in the sense that we still had this as a family system. Although, from correspondence that I have reviewed here, apparently, we even talked about specific instances where we would use Uvalde as a base and go forward from there.
The first time I got involved with Jack Crosby in a business way, other than cooperating back and forth and working with him on Southwestern Texas Transmission, was at a time when we were both serving on the NCTA board. Now this is a little ahead of the chronology but this is how we got into Effingham, Illinois.
We were in a board meeting in Chicago in 1961. Oh, I need to backtrack. A man came into the Uvalde newspaper office. He was from a town near Effingham. Harry Hornby called me on the phone and said, "Come on over here. There's a fellow here from Illinois who can't get TV." I said, "Harry, there's a lot of people up there who can't get TV." He said, "Just come on over." So I did, and this man was from the little town of Altamont, Illinois, which was just east of Effingham. So he was interested in the business I was in because they didn't have any of these kinds of things in that part of Illinois. They did up in northern Illinois. He said, "Right to the east of me is a big town with ten or eleven thousand people, Effingham." I looked at the map and saw they were ninety-five miles east of Saint Louis; seventy miles west of Terre Haute; and there was some local stuff about sixty-five miles away in Champaign or something like that. I thought, "God, they have signals all around them but they're far enough away." So Jack and I flew up to Chicago together for the NCTA board meeting. I said, "Let's take a car when this is done and drive down and see this Effingham. See if we ought to get interested, see what it looks like."
Incidentally, I made a lot of my long-lasting friends from when I served on that board. Gene Schneider and Al Ricci and people like that.
So we rented a car and drove down to Effingham, which is well over two hundred miles south of Chicago. We went to such appliance stores that were there, looked at the signal, and met some people. The fellow who had talked to me had said I should talk to Wes Petty. Wes was in the printing business there and as it turned out, he wasn't too good of a partner for us. At any rate, we talked to Wes. He knew this guy and took us to his house. They could get a lot of broadcast signals, but they got pretty terrible pictures. So we thought there might be something to this.
We met the mayor and told him what we were interested in. I said I would write him a letter and send a proposal with a sample franchise agreement, and I said we'd like to apply for the business. So we did that and the mayor got this thing. Kind of dumb-ass guy. He was wandering around the street telling people what he had gotten, "Look at this. Look at what these people want to do here. What do you think we ought to do?" God damn--the man he'd talked to was the man who ran the theater. I don't know how to describe this man Hays. I'd call him a crook if that weren't libelous. Anyway, Hays had worked with Larry Boggs' cable company, Vumore. I think Larry Boggs had fired him. Later, I asked Larry about it and he said, "I don't talk about him very much." But he worked for a company called Frasina Theaters. He had been trying to get his company to put a cable system in. They weren't interested. They were Italians, very fine gentlemen. We later became partners with them. They ran theaters and were based in Springfield. So Hays, on behalf of his company, filed another franchise. So we came to one of these franchise battles and Hays, damn his soul, raises the ante to 5 percent of the franchise fee. We had talked about 2 percent and that was that. Some of these councilmen were on the take.
Council people in Illinois had a real two-party system and we didn't in Texas, where it was all Democrats. The only difference in Texas was that you were a conservative or a liberal Democrat. At any rate, in Effingham a lot of these people were on the take and some of them wanted special considerations. I don't know if one councilman was trying to make us sell him on the idea, but he said, "I don't know. I just can't get excited about this." I said something to him that was later picked up in the newspapers, "Well, you want to be romanced on this, don't you?" He said, "Yeah, I want to be romanced." The council ended up issuing two franchises. Two. Our problems were compounded because neither the power company nor the telephone company would even talk to us about a pole-line contract. Neither one.
So, compressing the story, Jack and I, on one trip up there, agreed that two systems was for the birds. It was Jack's suggestion to go up to Frasina Theaters in Springfield and see if we could work something out. We didn't care for Hays at all. We walked in cold. As it happened, they were having a board meeting. A fellow looks up and said, "Ah! The boys from Texas! What are you giving us so much trouble for?" Well, we ended up forming a partnership and they did insist that Hays be the manager. He was their man, and we said all right but we didn't like him. They came to rue that because he screwed them royally later on. So Hays was our manager. We did get that thing going, but we set our own poles.
DUDLEY: For the entire community?
CONROY: The entire community. Twenty-five foot, class five poles. We used the power company engineering. We just followed along and set our poles right alongside the power company's. They'd object, and we said, "Up your ass, buddy. You won't give us a contract. We're setting poles. We got the right and it will be cheaper for us in the long run." I think it cost us between $15 and $20 per pole. And rates for people who did get contracts in that area were about $5 a year. So you know, in three or four years, we were out of that. So, yes we put in our poles.
As a promotion man, Hays was pretty good but he was promoting himself as much as the system.
We established a rate structure there that I had learned from Uvalde. This is 1962 when we started this thing, '61 when we had just started to look into it. But we had a rate structure there that was something like $20 or $25 to hook on and $6.95 a month or something like that. We got into the black there, much more rapidly than I had in Uvalde.
I dug something out of the files here. Jack and I drove to Indianapolis and went to Economy Finance to talk with them about financing. This is just one of the places that we visited. We had gone to my bank in Uvalde, but it was a little too risky for them. And it was way up in Illinois, too. We were trying to get a $125,000 loan, we needed that much. I forget how many miles of plant. I'm sure it was at least thirty, maybe a little more. Economy told us that, first of all, we had to make personal guarantees. Well, that was fine. I could make a guarantee, but if push came to shove, I didn't have the money to pay it off. But I guaranteed. The loan was made at a 6 percent add-on rate for five years. Effectively, that's about 11 percent. We thought, "God, that's high as a kite." But at that time, no one was lending money to cable.
Jim Ackerman was in this company. You may have met Jim at the Pioneer dinners. Jim was in there, Economy Finance. They were a home finance company, but they made a lot of consumer loans, too. They were getting into this field (cable), too. If the loan is made without the principal's guarantee the rate is six and three-fourths percent. I forget which we did. I think we probably said, "What the hell. We'll just go with the 6 percent." We had to arrange interim financing until the system was completed. For the life of me I can't remember where we got interim financing. It may have been our own banks.
DUDLEY: So their financing began only after you had your system?
CONROY: After it was complete. With add-on, if it was $120,000 they would add on the amount of the interest and it would be a $150,000 loan. That's the add-on business. However, they insisted we put in an additional $10 or $15,000 equity into the system. You see, I had made projections. Jack and I both had. But I made a final series showing what capital we were going to have in the system and they insisted that we put another $15,000 in to maintain the necessary cash flow so that we could begin repayment in the first year. We paid that thing out on time. In fact, we even had to borrow a little bit more when we extended into a neighboring town. But we paid it out right on time. That thing came along much faster than Uvalde.
DUDLEY: Were you still with Jerrold equipment?
CONROY: Here we did not use Jerrold. In fact, Fred Lieberman, at that time, had his Telesystems Company and he was developing equipment and we used a lot of Fred's stuff.
Editor's Note: The following was recorded after the interview was completed. The audio is on the addendum cassette.
At the time we were seeking financing to start the system up in Effingham, Illinois around 1961 or 1962, we had each tried our banks in Del Rio and also Uvalde. Jack may have used up all his credit, by this time, in Del Rio, so we went to a Uvalde bank. I presented our case and presented numbers. As we were leaving the bank, I glanced down at my feet and I had one brown shoe and one black shoe on. Apparently, I had gone home for lunch and before coming back to meet Jack had followed my usual custom of taking a twenty minute nap and had put on one wrong shoe. Well, we did not get the loan there at the Uvalde bank, but as I mentioned in another part in these reminiscences, we got it from Economy Finance in Indianapolis. I'll never know what part my mismatched shoes played in the Uvalde bank's decision. I think they really felt that Effingham, Illinois, was a little bit out of their territory and declined on those grounds.
End of insert
DUDLEY: Okay. You came back to Texas. Cotulla, Texas, is that next in the chronology?
CONROY: Cotulla was a little town about eighty miles south of San Antonio. This was going on about the same time as Effingham. Ed Leonard was the manager of Vumore's system in Laredo but he left them to go into insurance and he somehow got wind of this little town called Cotulla, which wasn't very big, maybe 3,600 people. So he got a franchise there and I had gotten to know Ed at a couple of the Texas Cable Conventions.
He came to me and suggested a fifty/fifty partnership, saying he would manage it and would be paid a nominal amount for his management. Cotulla is located on the main road between San Antonio and Laredo, probably at least eighty or ninety miles south of San Antonio. So we ended up putting that in. I'm trying to think where we got that financed. We may have been able to do that through the Uvalde bank. But in any case, we got that system started in about '63 or '64. It turned out that Ed was not about to swing his 50 percent so he reduced it to a level where he could swing it. I ended up with 60 or 70 percent of it. Just as a friendly gesture, I brought in some of my Uvalde friends. We all put up some money. It didn't take that much money to build that system because we had just finished changing to five channels. Uvalde had gone to five channels. Jerrold was able to get us some used five-channel equipment. That's right. We were able to get it on favorable terms.
So we put that system in with used equipment. That area, too, was heavily populated, over 50 percent were Spanish-speaking people. We put up the usual four hundred foot tower and we were able to immediately bring in Channel 41 from San Antonio. We enjoyed a kind of a slow growth there. It wasn't spectacular but it eventually became profitable. We turned ourselves into a sub-chapter "S" corporation. We paid off all our loans--I think I had made quite a few loans at that time to the company--paid all of those off and then operated it for a number of years with just making quarterly dividends. We all made a little money on it. Eventually, we sold it in '79. We never got much more than a thousand in customers which, I think, was 95 percent of the homes.
DUDLEY: How did you get to Rumford, Maine?
CONROY: That was a little bit later in the game after I had become involved in telephone pole attachment matters. Rumford, Maine was a place where one person was trying to build a system and was having very, very heavy problems with the telephone company. In fact, he couldn't get a pole line contract. The phone company there said, "We'll only lease you a system. Build it and lease it back to you." This one fellow went ahead and built his system and may have set his own poles or maybe was just using power poles. Then the phone company came along and somebody else built a system on a lease-back basis.
So there were two systems running. It wasn't a good situation. In fact, this had come to our attention simply through my work on the pole line committee and the NCTA. We kept hearing through Al Ricci, who is from New England, about this situation up in Rumford, about what this damn phone company was doing in order to drive this other guy out of business. Fred Lieberman became acquainted with it. Fred negotiated the deal. But it ended up with four of us, Fred, Jack, myself, and Al Ricci. We all invested a certain amount of money to resolve this problem up there.
I often used to laugh that we resolved this problem just by laying money on the table and buying out the phone company. We ended up buying the other system and combining the two of them--paying off the phone company and the lease-back contract--and we began to operate the thing. That was the involvement there. It was really an effort to help solve a pole-line problem. I'd hate to solve every problem we had by doing that, but it eventually became profitable. Fred's company managed it.
DUDLEY: General Communications and Entertainment Company, Inc.
CONROY: Yes. let me backtrack just a little bit. Once the Uvalde system got kind of profitable, or at least I didn't have to spend as much time with it, I could afford the time. Jerrold wanted to know if I could represent them in the southern tier of counties, from roughly Eagle Pass over to near El Paso. Traveling and visiting systems and selling equipment. So I did that for two or three years and met a lot of the operators. I didn't make much money. They paid my traveling expenses, and I did sell some equipment and I got a commission on that.
DUDLEY: You still owned your interest in the companies, these other companies, right?
DUDLEY: When you were working for Jerrold.
CONROY: This was in the late '50s. I wasn't in Effingham then, and I wasn't in Cotulla. But yes, I owned my interest in Uvalde. Bill Miller had me selling Jerrold, it was at his request. This saved them from paying a guy to travel this route. It was far from Dallas. They were trying to establish new systems. I think I did help a couple of people get going in new places. Mostly it was servicing existing ones. So I got to see quite a bit of the country and met a lot of the people and, therefore, I got a little more well known than had I just stayed in Uvalde. That led to other things, in terms of the state association work and so forth.
DUDLEY: I want to get to the Texas Association and NCTA later on. What I'm trying to get at right now are the other companies you helped establish and operate.
CONROY: You mean General Communications and Entertainment? Okay.
DUDLEY: And whether or not these systems then continued to operate as separate systems or whether or not you were an MSO.
CONROY: Yes. Jack Crosby, in the meantime, had formed an alliance with Fred Lieberman in the Telesystems Corporation. I think Jack might have owned 25 percent or something like that. I'm not sure of the figures. He soon wanted to parlay his interests in Del Rio and expand into other systems. Which he did. He ended up building a system--I'll cover this more when we talk about the local telephone system--for a variety of reasons Jack went in with a group in Eagle Pass, Texas, which is just down the river from Del Rio. But in any case, Jack had been after me, wanting to buy Uvalde. He made various offers from time to time, my correspondence shows. And other people were coming to buy.
I remember even Frank Thompson in 1965 visited my system. At that time, he was working for Jack Kent Cooke. He paid a visit. But about that time groups of us were talking. We talked about what would happen if we put our systems together, what it would look like, and so forth.
Before the '65 and '66 NCTA conventions, we got serious enough so that people such as Crosby, myself, Glen Flynn, Tyler, Gene Schneider of Casper, Wyoming, talked. We put together a plan whereby we would form a holding company which would continue to operate our systems. The systems would, essentially, keep their corporate character. Therefore, I think we felt we wouldn't have to go back before our city councils because the basic corporate ownership had only been expanded. We still had the same people in them. So we, indeed, did put that thing together. It became known as General Communications and Entertainment. We called it Genco.
At the same time, Jack and Fred had expanded into west Texas and had purchased West Texas Microwave and also the system in Abilene, Texas, and the franchise in Sweetwater. That was put into this group, too. Those latter two entities were financed by a group near Austin, up in Georgetown, Texas, just thirty miles north, called Texas Capital Corporation. Bob Hughes was one of the account people up there. Jack had become acquainted with him. It was a SBIC (Small Business Investment Corporation). Jack not only had Del Rio that he wanted to put into this thing, but he and Fred had West Texas Microwave and Abilene.
So we ended up with all of those system. Gene Schneider in Casper had a group called Wentronics. It wasn't just Casper; he had systems in New Mexico, as well. He even had a system on the eastern shore of Maryland. Gallup, New Mexico was one of the systems and Moab, Utah, another.
DUDLEY: Do you know how to spell Wentronics?
CONROY: Wentronics? Yes, W-E-N-T-R-O-N-I-C-S. That would probably be a contraction of Western Electronics or something like that.
Gradually, other people came into the fold. Bud Nelson who, with his father, owned systems in Peru and La Salle, Illinois. This was a combination for us of stock and cash. We pulled some cash out of this--the Uvalde shareholders--and kept some stock. Some of them came in just for stock. I think it was just stock, for instance, for Abilene and for West Texas Microwave, although I can't really be certain about that. This company operated for a year or so. It was put together in 1966. It operated for a year, year and a half, and I don't know how the connection was made, but I think Jack was the one who talked to the president of Livingston Oil Company.
The president of LVO in Tulsa was Wayne Swearingen. Livingston Oil was a small--what they call a secondary--recovery oil company. They would go into a well that had worked, initially. Then they used water flooding to push the oil up, thus, it was a secondary recovery company. It wasn't too large; they wanted to expand into other fields. It was a New York Stock Exchange Company. So that merger was effected. I think we were still Genco, but we were now involved with Livingston Oil. I ended up, for a very short period of time, serving on the board. The people in Tulsa didn't seem awfully comfortable with cable. Jack, I think, had felt that this would be a stepping stone toward enlarging our interest in cable because they could command much more money than we. It came to a point, and I don't know the exact issues that brought it about, but we differed. Jack did most of the talking with them and we differed on points of policy. I think the main problem was Livingston's unwillingness to step forward on some of the projects we had in mind.
End of Tape 2, Side A
DUDLEY: We were talking about Genco. Then what happened?
CONROY: Well, I'll backtrack one little bit. I neglected to mention that during the course of our acquisition program, we got financing from Home Life Insurance Company, and we also had an association with the Bank of the Commonwealth in Detroit. I think, in these kinds of involvements, it was Bob Hughes working with Texas Capital who helped us along. Texas Capital, itself, would not finance Genco. They had financed Crosby and Lieberman, as best as I can recall, in the acquisition of West Texas Microwave in Abilene. So we had come to a disagreement with LVO, to the point where I know Crosby didn't want to work with them anymore. Ultimately, we arranged to buy back the systems of Del Rio and Uvalde when we could get the money. Whatever the price was, I forget, and to start up something else. This would have been around 1968, when we parted.
Gene Schneider stayed with them and that company, today, is United Cable. It first became LVO Cable and then Gene changed it. He was spun off, he broke away from Livingston. I don't think Livingston exists any more. Then Gene formed United and, for a while, stayed based in Tulsa. Eventually, he moved to Denver and built up United Cable, as you see it today. His original system was Casper. Of course, that is where Bill Daniels started, too.
Here we were with the promise to pay for Uvalde and Del Rio, and in the meantime, we had gone over to Kerrville, Texas, which is a town somewhat west and south of Austin. Kerrville is a town of about 10,000 or 12,000 people, about like Uvalde but with a better composite makeup. There wasn't much of a minority population. The owner of the system in Kerrville, Mr. Brances, was interested in selling, so we laid our proposal before him, the kind of company we were, what we were going to build, and how we were going to pay for it.
That became CPI, Communications Properties. It was originally called Communications, Inc. We went public with probably 11,000 or 12,000 customers in the three systems, and the reason was to pay for the systems. There was quite a period there, four or five months, when none of us took salaries. At this time, Bill Arnold had joined us at Genco, as treasurer.
I first met Bill in '65 or '66. He came down to Uvalde and I thought to myself, when I started to ask him questions, "My God, this guy talks so much." I kid him about it, he laughs about it, even to this day. You ask the guy a question and he gives you a paragraph or two for an answer. Anyway, Bill is a fine fellow. He was treasurer of the company. Bill was always more of a numbers man. In those days he did the accounting and ran the accounting group.
When we went into CPI, it was really the four of us who were the founders: Crosby, Hughes, myself, and Bill Arnold. Jack's position was pretty much as a deal maker. He was going out to find other deals. Bob left Texas Capital to come with us. His job, basically, was to find money. I was the operator to run the systems, and Bill was the man to keep track of where the money was. So that's where that was.
By then, we had publicly held stock. We came out with units. There were so many units of stock. Then there was a debenture with it. I've forgotten the denominations, but the combination was sold in units. We wanted to establish evaluation for the stock. So there was a group of systems owned--I think Jack had something to do with these systems, too--as well as a man named Glen Scallorn, who is still manager of Del Rio. Another great fellow. He managed those. Southern was a group of three or four small systems just west of Dallas--Ranger, Cisco, Eastland, those little towns. These may have had 3,000 customers. At that time, we wanted to establish a basis for buying systems for stock, plus it would give them a lot more credibility. See, we bought them for stock.
We're getting into the '70s now. The group up in Ohio was called Tower Communications, originally, Tower Antennas, based in Coshocton, Ohio. They had already traded with Citizens Finance Corporation in Cleveland. There was a man at Citizens, Dick Johnston, whom Bob Hughes and Jack had met and we had talked about it again--our little company acquiring them. They had a lot more customers than we did. So it ended up that Tower Communications came into the CPI fold. The man who ran Tower, the cable operator, was Claude Stevanus. He lived in Sugarcreek, Ohio, and is still there, retired. They had a lot more systems than we did and had their own computer system. So we were gradually building things up.
A little bit after that, Fred Lieberman's group came in. They had built a portion of Philadelphia and had franchises around Philadelphia to build more. They owned Lafayette, Indiana, which was a big system, and they owned Williamsport, Pennsylvania. So Williamsport, Lafayette, and all of those came into the fold.
DUDLEY: Now, are you still buying these for stock?
CONROY: Stock. As much as I recall. Let me tell you that Bob Hughes was the money man and we dealt with lots of banks. I think, initially, we dealt with Fidelity in Philadelphia. Then Pittsburgh National Bank became our lead bank. But we were also involved with Chase in New York, a bank in Cleveland, Home Life, and Aetna. All of these, particularly the insurance companies, would get either stock or warrants on the stocks so that, in essence, they not only lent the money, but they got some equity.
About this time, of course, the mad pursuit for franchises was on. When Fred's company came in, he was in the process of building a system in Meriden, Connecticut, and was beginning in Hartford. Hartford became a construction project. That's where the money from the banks and the insurance companies came in to fund these projects. Eventually, we got Louisville, Kentucky, and we began to build that in the '70s. We got North Little Rock, Arkansas, and a couple of little towns surrounding it. I can't remember them all. We bought Springfield, Illinois, in the early 1970s. By the time we ended up and were purchased by Times Mirror in 1979, we had probably 330,000 to 340,000 customers. We were operating in eleven different states. More of Fred's systems were in Massachusetts in the Pioneer Valley, and a couple of towns near Boston.
DUDLEY: CPI was then still operating from Austin?
CONROY: Oh, yes, our headquarters was here. We divided up the company for operations purposes into four regions. By this time Bill Arnold had moved from numbers and we'd brought in another man as treasurer. Bill handled what we called the Austin or the Southwest Region. It was all the systems in Texas, which also included Midland. That had been built at the end of our days of Genco. Fred Lieberman got that franchise.
This is one of these funny things. Fred had gotten that franchise in his name, although Jack Crosby and I had made trips out there, and had worked in getting the franchise with a couple of investors out there. But we did it under the Telesystems name, because Genco was going in another direction. In the meantime, once we began to form up CPI, Bob Hughes, working on the east coast, had gotten franchises in New Jersey. Point Pleasant, Point Pleasant Beach, Manaloking and that group. So this was before Telesystems and before we were together. We built and managed Midland for Fred and he built and managed this New Jersey complex for us. Now, there's no rhyme or reason, except that it worked. Al Bloom, out of Philadelphia, was the manager there.
We were divided up as CPI into four regions. The Austin or Southwest Region and the headquarters, Bill Arnold was the operating guy here; Midwest was the Tower region with Claude Stevanus; the Eastern Region, basically the Telesystems Group. Initially, Al Bloom, who had been Fred's man, managed all of it until New England started to get too much for everybody to handle, so we took the number two man at Tower, Paul Snyder, and brought him over to New England. Then we formed a New England group, which was Hartford and the other systems in Connecticut, plus other franchises in Connecticut and the systems in the Massachusetts towns. Paul, unfortunately, got burned out, because Ohio was his territory, not Hartford, Connecticut. So we hired a man named Ron Dorchester, who, today, is Prime Cable's senior vice president. He runs the Prime systems.
DUDLEY: Is that Prime as in Las Vegas Prime?
CONROY: Yes, that's right. They're in their second generation of systems. Ron Dorchester started with us as my regional manager of New England. I might say Ron is one of the finest management individuals that I ever worked with. It was great to have him working with us because he always kept us informed and he anticipated things, was a hard worker. He is doing well with Prime.
DUDLEY: I've lost track now of CPI as an entity. Is there a Board of Directors?
CONROY: Oh, yes. Well, first of all, my job was head of the operating cable companies, all four regions. There was a Board of Directors. We had Jack, myself, and Fred and Bob, and we had a couple of outside directors. I think we also had a representative of an investment house, the same fellow who had taken us public with Genco, Jim Cullum. We had a man whom Jack had known. He lived in San Antonio and owned newspapers and TV stations, Houston Harte of the Harte Hanks group. Also on the Board were Claude Stevanus and Paul Snyder from the Tower group as well as the representative of Citizens Finance in Cleveland. We were doing reasonably well.
You know, the cable industry fell into pretty hard times in the early and middle '70s. The rules hadn't been lightened up that much. We were still operating under the 1972 FCC rules and deregulation hadn't begun. At one point, a couple of the banks told Bob Hughes, "We're going to call your loan. We want it paid off." We didn't have the money to do that so, I think, in essence, what Hughes did was throw a set of keys on the table and say, "Okay, there are the keys to our system. You take them." And he walked away. Well, that's not what they wanted so they kept on with us. Bob is a gutsy little guy. He was the one who worked with all these people. I was always glad not to. One, because I'm not that well oriented in finance. I'm more into operations and even engineering, if you will. But Bob is very, very good at finance.
In about '78 or '79, Fred Lieberman wanted to sell and they were talking with different people. They ended up talking with Times Mirror about a buyout. They were going to pay cash for stock and take on the debt. By this time, I guess we had about 340,000 customers and probably our debt load was $80 or $85 million, something like that. So in April of 1979, that sale did become effective.
I must confess that, at the time, I didn't think the price was very good. I think the price was $17 and United Cable and we had been tracking each other in the prices of our stock, and before long, they were up to $24. I don't think Bob Hughes thought the price was very good either. Our biggest single shareholder, Fred Lieberman, wanted out so the 800-pound gorilla sat down where he wanted to.
DUDLEY: When you say $17 and $24, you're talking about cost per share?
CONROY: Yes, the price per share on the market. So, with that, CPI came to an end as an operating entity. A lot of our people moved out to California. I don't think very many are still with Times Mirror.
I declined to move. I had no interest whatsoever in being in California with Times Mirror. I don't think they had a place for me. I remember Ralph Swett, who was then President of the Times Mirror Cable Unit, came. I had been working with him to try to ease the transition and help the people who were going to move to California. The big question in his mind was, "Am I going to move out there? If so, doing what?" He had a number two man, so I knew I wouldn't go out there as president. I didn't want to go to California in the first place. There was no question in my mind about taking any offer and I wasn't angling for one.
I remember one time he was up at the house and he said, "Well, we've got everybody settled, so what's Ben Conroy going to do?" I know that Toni and a couple of the kids were listening in the next room because they didn't want to go to California either. So I said, "Ben Conroy is going to stay right here." I could see his sigh of relief.
DUDLEY: You mentioned that regulations still had cable under tight control in the 1970s. Could you elaborate?
CONROY: Well, you have to start before the 1970s. You see, when I first came into cable, the only FCC regulation that affected us was that of radiation from our cables. That is, we couldn't radiate beyond a certain amount. Okay. But there were pressures from broadcasters in the smaller cities with TV stations, where there were also cable systems such as Tyler, Texas. While the broadcasters liked having their signals brought to other communities, particularly by microwave, they weren't enamored about having other broadcast signals brought into their communities. They really had the ear of the FCC. They made a case with the FCC that we were destroying their economic viability. There was even a bill proposed in the Senate, S.2653 in 1960 or 1961. I was one of the troops that went up the Hill and stormed the Senate. That bill was beaten by one vote. Although, in retrospect, looking at what came later on, that was a harmless, little bill. But at any rate, we beat that.
DUDLEY: Do you want to mention a couple of the other principals relating to that bill, for and against?
CONROY: Yes. Of course, NCTA had originally supported the bill, even with some amendments, and then at the last minute, they switched and opposed it. Now, the opposition was led by a man named Henry Griffing from Oklahoma City or Tulsa. He was Larry Boggs' group.
Milt Shapp was opposed to it, very much. I wasn't on the NCTA Board, at that time. I think this was 1960. I'd gotten pretty friendly with Milt, not only because of our business relationship--even after we parted ways, we had a very friendly relationship. But Milt had started very active work as chairman of the Pole Attachment Committee. We'll talk about that a little later. So word came out and Milt was the one who contacted me. He said, "Can you be in Washington early next week? The bill is coming up." People came from all over the country.
At the same time, we were encouraged to get people in our hometown, our mayors and so on, to send wires to their senators. Our senator then was Ralph Yarborough. He tended to be on the liberal side. I remember that I even got a copy of a note written out for a telegram that Tully Garner (son of John Garner) wrote and sent up there. I remember going up on the Hill and meeting with Yarborough and he said, "You damn people. People that have been my supporters all my career. You've got them against me here." I said, "Well, you know, it's my career, too, Senator."
I particularly remember Henry Griffing and Milt Shapp. Our man on the floor fighting that was Senator Monroney of Oklahoma and another one from Oklahoma, Kerr. Particularly, Kerr. He got up and made an old, down-home, country-boy speech. Strat Smith's name was mentioned in vain during the course of the proceedings because he was the NCTA's general counsel, at the time. Senator Pastori, before whose sub-committee the bill was heard, was irate because he felt he had been double-crossed. And it probably was so. You can't treat the Congress that way, agree to it and then switch. So for a long time the NCTA's name was an anathema on the Hill. They couldn't get anywhere. But, anyway, we beat the bill. I remember going with Henry Griffing and Larry Boggs to Monroney's office. Monroney opened the door and Henry Griffing said, "You old son-of-a-bitch, we did it!" Great rejoicing. But it came back to haunt us.
Later in the '60s the Carter Mountain case came up, which resulted in the First Report and Order and, maybe later, the Second. But, in any case, it turned out in the First Order: cable systems that were receiving certain signals by microwave came under FCC jurisdiction to the extent of those signals, and they had to provide a certain amount of non-duplication.
Sometimes it was two weeks or so. Sometimes it was twenty-four hours. Later, the Second Report and Order came out that put all cable systems under their jurisdiction. Work in any of the top one hundred markets just fell off. There was no activity at all. It wasn't until 1972 when a massive set of rules came out. This, in effect, did tend to open up the top one hundred markets, but under conditions not nearly as favorable as we would have liked. It not only restricted the duplication of signals, but it restricted the number of signals you could import depending on your location.
It also provided for exclusivity. This gets into the copyright field. Say you had the rights to show a series, let's say, "I Love Lucy," in this town and weren't even showing it. If it came in on another station you were importing by whatever means, even off-the-air, if you were in the thirty-five mile zone of the station affected, you had to black the series out. If you don't think that was something to explain to your subscribers! It was completely unsatisfactory.
It wasn't until the mid-'70s that two things happened. The rules eased some, and satellites came along. Cable really started to thrive. The satellite era started in 1975.
DUDLEY: We've pretty much dealt with local regulations and franchising and we've gotten this first leg of federal regulations. How about state regulations and how they impacted the cable industry?
CONROY: The first instance that I can recall on state regulations was, I think, the Martinez case in California. That was as early at 1956 or 1957. It referred to Martinez, California, and I think there was a proposal to put the cable operation under PUC control; I think that thing failed. As time went on, there was more and more pressure from various states to have cable treated as a public utility. This became a major issue for NCTA and for individual systems and state associations, to keep out of PUC control.
The state of Connecticut is an interesting example. Cable did not start in Connecticut even though there were classic locations to put cable. Classic in the sense that signals were not good, or there weren't enough of them or whatever. Cable didn't start there, primarily, because of the position of the telephone company, SNETCo (Southern New England Telephone Company). Well, there were many bastards in the telephone industry, but they were prime examples. I think they tied up all the communications space on the power poles and then they wouldn't give contracts at all. At all! We only began to have cable up there after the state had taken control and enacted a law that cable was a public utility in Connecticut. This was all due to the power of the telephone company of that state. This was on into the late '60s before anything got going. The only thing they had going in Connecticut were apartment house systems.
There was a fellow named Bill Schlank, he's dead now. I think this whole thing probably killed him. He was on our NCTA pole line committee. He was a noisy fellow. Boy, was he against that phone company. He couldn't do anything with them. There was another fellow, who I think was a competitor, named Matt Janatopolis. I don't know how I'd remember a name like that. Matt was operating in New Haven in apartment-house systems.
Connecticut was the last state in which cable got going. We later operated in there and I appeared before the Public Utility Commission. The funny thing was that we were able to get higher rates in Connecticut than in other states. We started the Hartford system out at $8.95 a month. But, still, there was a burden of public utility-type regulation. On rate-of-return type of regulation. Of course, we're not that kind of an animal. We just never were. We're not the nature of a public utility. Unfortunately, the state of Nevada enacted similar regulation. The state of Vermont, my old hometown state, had cable as a public utility, and I think there were a couple of other states.
The National Association of Regulatory Utilities Commissioners (NARUC) were very active in the '60s and early '70s. This was after my chairmanship year at NCTA, which was '65-'66. Before that I had succeeded Milt Shapp as chairman of the Pole Line Committee. I dropped it when I was NCTA chairman. At that point, Jack Crosby took over the committee. After my term as chairman, I resumed my chairmanship of the committee. It wasn't just dealing with the pole-owning companies, we were dealing in extensive negotiations with the NARUC group. In fact, the fellow that headed it, at that time, was Reese Taylor. He had been governor or something of Nevada. He was really giving us a siren song about, "Wouldn't it be better to have regulation closer to home and not have these federal people all over it?" We said, "No, no, we'll take our chances with the feds because we don't like your kind of regulation." We told him, frankly, one of the reasons why we didn't like it, "Your Public Utility Commissions are controlled by the power and the telephone companies, particularly the phone companies. Our problems with them are such that we don't need to be any further in bed with them than we are now, and we're certainly not going to subject ourselves to the type of regulation that you propose." We met many times with him. That thing kind of died. We ceased negotiating.
One thing that I proposed when I was NCTA chairman was to urge all of the state operators, "Get yourselves organized, even if you only have a lobbyist in your state capital to watch bills for you. Get yourselves an organization." At that time, NARUC was really active. I said, "They're going to be after you, and the first thing you know you'll find a bill in there that will be passed and you won't even have been able to testify. So get yourselves into state or regional associations, but preferably state. Even with a regional association, the state is going to have to take care of itself."
Editor's Note: The following was recorded after this interview was completed. The audio is on the addendum cassette.
The next thing relates to the NCTA during my chairman year, 1965-1966. During my chairman year, I traveled quite a bit to speak at state and regional association meetings. I think it was around December of 1965 that I was in California to speak at their meeting. I don't know if this was typical, but one of the cable manufacturers got me aside and offered me $50,000 for the year during my NCTA chairmanship if, in my talks around the country, I would see fit to mention his company by name. I had not done much business with him because, personally, I regarded his operation as a shlock operation. As I say, I don't know if this was typical. It was the only instance of anything like this ever happening to me. I just kind of laughed and, of course, I didn't do it. He was a likeable enough man, but I didn't have much respect for him after that and never again bought anything from him.
This also relates to my chairman year. During that year, I retained an interest in the Pole Line Attachment Committee or, as we called it then, Utility Relations Committee. Jack Crosby had taken over as chairman of it. Sometime during the year, Jack and I, and Fred Ford, who was President of the NCTA, made a trip to New York. We were going to visit with both AT&T and General Telephone. In our meeting with General Telephone, one of the people present on the telephone side was Ted Brophy, who was then GTE's General Counsel. I cannot precisely recall all the subjects we talked about. General Telephone was very, very tough in their dealings with local cable companies, and we understood that they were about to close down on offering any pole attachment contracts whatsoever, anyplace. This point was raised and we were assured, at that meeting, that no such instructions had gone out.
As I said, there were several people present. Ted Brophy was one and he was then the general counsel and he later became chairman of GTE. Somehow or other, we got a copy of a directive that came out of GTE headquarters which was in direct contradiction to what they had assured us. Word from GTE headquarters went out either to impose more restrictions or just cease offering pole attachment contracts at all. We saw this. The next meeting we had with GTE was in Washington. I don't know the timing of this. It may have been after I was NCTA chairman and had taken back the chairmanship of the Committee but, in any case, Ted Brophy was there. I remember remarking at the beginning of the meeting, "I hope that results of this meeting will not be reflected with the same kind of prevarication that we got at the last meeting." I cited our experience, and I can remember Brophy's face getting very, very red. He was obviously angry at this sort of thing being brought up. At that point, we just went on to other matters relating to our problems with General Telephone. Ultimately, the FCC came down pretty hard on General Telephone because of a case brought relating to Bloomington - Normal, Illinois and Manatee, Florida and all of the other cases under the 214 ruling. Eventually, they and all phone companies were prevented from operating cable television systems in their own operating area.
End of insert
DUDLEY: This seems like a good point to backtrack and talk about your involvement in the beginnings of the Texas Association and then the NCTA.
CONROY: All right. Back in 1958, the FCC was proposing to legalize what we used to call illegal boosters. These were VHS translators in remote rural areas that we felt, at the time, could be a threat to us because they were proposing to install them in some of the same towns that we were operating in. At that time, there was an association called the OKT Association, the Oklahoma, Kansas, and Texas Association. I never had anything to do with it, I don't think it was an active entity. It did exist.
I think the NCTA had suggested that in various areas operators should get together to study this and be informed about it. I think they had people roaming the country telling us about this booster thing and that we should take it pretty seriously and do what we could to combat it with our representatives and senators.
We had a meeting in Dallas, I think there were twelve to sixteen of us there. I was there, Crosby, Tubby Flynn, Johnny Mankin, John Threadgill, all the people I mentioned before. A fellow named Brown Walker from Graham, Texas; Larry Boggs; and a few more. We met at some hotel in Dallas and we talked about that, but then we started talking about whether or not the state of Texas should have its own association. We agreed, "Yeah, we really ought to do that." Brown Walker, who was always a great one to talk and then walk away from the mess he had made, said, "Well, CONROY, why don't we elect you, just temporarily, to head this thing up and get it organized," and blah, blah, blah.
We had a rather informal organization. At that time, we didn't have a set of by-laws. As the year went on, I was talking to Glenn Flinn, who was on the NCTA Board. I think it was probably he who said, "We ought to get this more formal."
So I took a set of NCTA by-laws and went to an attorney in Uvalde and told him what we wanted and said, "Let's adopt this for a state of Texas Cable TV Association." We may have been Texas CATV Association to start with. We did that and then we had a formal organizational meeting.
I was the first president and I think Jack Crosby was vice-president, Johnny Mankin was secretary-treasurer, until he died a couple of years ago. Wonderful fellow, Johnny Mankin, great. He was the manager of Glenn Flinn's Tyler system, which got to be a very large system. Also, had Jacksonville, Texas, just south of Tyler. It was funny because when we had Genco, Johnny became one of my managers. Things go full circle.
We did get ourselves organized into an Association and our first meeting was a membership meeting. I think it was in Mineral Wells, probably about '61. Johnny Campbell was the host. I was president for the first two years and stayed on the Board of Directors for several after that. Looking back, we really didn't have a lot of serious problems, but we were ready. I think we charged ourselves a half-a-cent per customer, per month, for dues.
The main thing that our Association accomplished in the mid-'60s was related to the state sales tax. In the beginning, it was going to be fairly broad, and cable was mentioned in it, initially. We got a lawyer/lobbyist here in Austin and we gave testimony at the appropriate committees. We convinced them that this was not a tangible service and the bill gradually came down to tangible goods. Cable was out of it. It is in now, but it was out then. That thing alone brought a lot of people into the Association because it's a hassle when you are subject to sales tax. Later on, there were bills to promote public utility states and so forth, and we were always able to beat them down.
The only real problem we had was in the '60s. After my initial time on the Board, I think after '66 or '67, maybe even before then, I left the Board and for a while was kind of an elder statesman. But I didn't go back on the Board. I did often go to the Board meetings though, and I've always gone to the conventions. I still think the Texas conventions are some of the best.
Johnny Mankin was the one who started putting those on. Bill Arnold got to where he was helping Johnny a good deal. It got to the point, as Johnny was getting older--this was the early '80s, I guess--that the board recognized that they really needed to have a presence down here in Austin. So Johnny was kept on in a kind of an auxiliary capacity. About that time, Bill Arnold wanted to leave Times Mirror, he was just unhappy there. One of the Board members asked what I thought of Bill Arnold as the executive director. I said, "Bill and that job are made for each other. That's the way you ought to go."
There probably were other things involved with the Texas Association. I do remember some things. There was an organization back in the mid-'60s called TAME, Television Antenna Manufacturers something. This was one of the many pressure groups that was hostile to cable. Everybody was hostile to us. Just count them. You had the copyright people, the movie people, the network people, the stations, the telephone companies, gradually the power companies, and the antenna manufacturers. We had only one group of friends: our customers.
DUDLEY: Which was maybe the most important group.
CONROY: They were the most important group. They not only buttered our bread, they helped us with our political problems. These TAME people would make up the most scurrilous stories about cable and the terrible thing it was, and what it would do to a town. But when you came right down to debating with them and taking them apart, fact by fact, their arguments just didn't stand up. I remember one time in Dallas, the NCTA asked me to appear at this TAME meeting, which I did. I had already gotten a bunch of their literature and folders, and I just went through one by one. There were antenna manufacturers there. This was before a meeting of Texas TV service people. I just said, "This stuff is garbage. You can't back that up and it just doesn't happen. this is just pure garbage and if you want to believe these people because their ox is getting gored, it's going to be your problem." They gradually died out.
Editor's Note: The following was recorded after this interview was completed. The audio is on the addendum cassette.
This particular incident took place about the time when I described meeting Glen Scallorn when Jack Crosby, Johnny Mankin and I were in Austin on Texas Cable Association business. Shortly after the formation of the Texas Cable Television Association, approximately 1960, John Mankin got a letter from the Texas Association of Broadcasters written by Bonner McLaine, the executive director. He also handled other Associations and was in the public relations business. His letter invited our new Association to join the Texas Association of Broadcasters, TAB, as an associate member and for our representatives to attend their upcoming annual meeting in Austin. Jack Crosby, vice president of our Association, John Mankin, and I attended. We visited around, attended sessions and greeted people, as you would generally do at conventions. Once our presence became known, there was a noticeable chill in the initially cordial atmosphere. Notably, Marshall Pengra of Tyler, Vann Kennedy of Corpus Christi, and a few others who were notably anti-cable. It was an embarrassed Bonner McLaine who later had to un-invite us from the Broadcasters Association. The situation remains the same today in regards to any cross membership, although there is now no reason for it. Relations between cable operators and broadcasters in Texas were good through the years with some notable exceptions. We have had broadcasters at our meetings, talking to us and being on panels, and we have done the same with them. Many Texas broadcasters eventually got into cable.
A little side note on Bonner McLaine, may he rest in peace. He died this past year. Twenty years after the above incident, following the sale of CPI to Times-Mirror in 1980, I was pursuing franchises on my own and was applying in the little city of Pleasanton, about thirty miles south of San Antonio. I don't know how many applicants there were but there were two serious applicants. I had aligned myself with the man who had been the previous mayor for fourteen years who knew his way around. His was the only local presence that we had. My group was, generally, friends, people I had known in the business, and a couple of CPI people. They were actually investors, not just 20 percent "paid citizens" in the case of local people in the towns. I say there was only one in Pleasanton. He was also an investor; nobody got any free stock. The other serious group was composed of a local radio broadcaster, the mayor's son, and, of all people, Bonner McLaine. That was the first time I had seen Bonner after all those years. While the council was deliberating after our presentations, I got to visit with him again. We both were laughing by our recollection of the 1960 un-invitation. As it turned out in Pleasanton, my group got the nod over the mayor's son, one of the reasons, I think, being that the mayor's son was not too popular in the town.
There's another event worth noting, and it also has to do with the Texas Association. This must have been in the early 1970s. A bill had been proposed in the Texas Senate which would have put cable under the jurisdiction of the Texas Public Utility Commission. This was referred to as the State Affairs Committee. One of the senators sitting on that was Senator Mike McKinnon of Corpus Christi. He was also the general manager of Corpus Christi Channel 3, an ABC affiliate. From my understanding, he was not too highly regarded by his fellow senators. However, he was a big proponent of this bill and he subjected us to a great deal of hostile questioning. Some of it dealt with whether or not cable was going to be a vehicle for pay TV. This was the early 1970s, and if there was any pay TV around at all, it would have been on cable systems as taped offerings. But I don't recall that there was actually anything like that on Texas systems then. Following my formal presentation to the committee and the presentation of others, and after responding to his hostile questioning for a while, I suggested that his presence at this hearing was, in my opinion, a direct conflict of interest because of his broadcasting business in Corpus Christi. I could hear my lawyer lobbyist at my side kind of gasp. This senator made all sorts of objections, "You're out of order," and the like, but the bill never did get out of committee. It's interesting, too, that this man, plus the main Corpus Christi newspaper, and CPI had actually joined forces the next year or two in an unsuccessful attempt to obtain the Corpus Christi franchise. I guess a lot of those broadcasters wanted to hedge their bets and get into the game; however, they did everything they could to put obstacles in cable's path.
End of insert
DUDLEY: Tell me about the Mankin award.
CONROY: It's the state of Texas' equivalent to the Larry Boggs award in NCTA. I always thought it was strange that it was named while Johnny was still alive. I'm trying to think whether I was active then or not. It was probably on the tail end of my activities as a Board member when this thing was introduced. I honestly can't recall what were the circumstances of its introduction; Johnny got the first award.
DUDLEY: It is given for what purpose?
CONROY: Outstanding performance and leadership, etc., in the state of Texas affairs.
End of Tape 2, Side B
DUDLEY: Could you now give us some information about the NCTA. It's beginnings, your involvement with it, various committees, chairmanship, and so forth.
CONROY: In the beginnings of it--I wasn't there at the Genesis--but from materials that I will turn over to the Museum, I can tell you that the first meeting was held September 18, 1951. The second meeting was held within a week, September 26, 1951. The formal organization began at the meeting in Pottsville, Pennsylvania, January 16, 1952. The materials that I will pass on to you will list who attended. Of course, Marty Malarkey of Trans Video Corporation was the initial president and served for the first five years.
This information portrays the reason for forming NCTA was the attempt by the operators to protest the federal excise tax of 8 percent on wired communications. This issue was not resolved, to my knowledge, until the Guss Pahoulis case was brought. I think it was brought by George Barco. Pahoulis was a subscriber to Barco's system in Meadville, Pennsylvania. This was not resolved until around 1956 or 1957. It resulted in the federal government refunding whatever tax had been paid by the cable systems. Many cable operators, Uvalde included, refunded the money to subscribers and we made a big deal about refunding it. That was the impetus, as far as I know, of the formation of NCTA.
I did not attend my first convention until, I think, 1958 in Philadelphia. The main reason being that we were still under Jerrold's management control and they saw no need for their managers to attend meetings of this type. In 1958, we obtained our independence, and my father and I went to the Philadelphia meeting. I think, probably in the earlier years, too, we just couldn't afford to send me.
In 1959, Milt Shapp called a special meeting of operators from all over the country. I met operators from all over the country, each representing a different region. I got to know quite a few people then. At the 1959 convention, I remember being involved in some discussion from the floor. I guess, to put it bluntly, I was beginning to become known up there. So was Jack Crosby. I think Jack was elected to the Board in 1960, and I was elected at the San Francisco meeting in 1961.
One of my first assignments came when Glenn Flinn was chairman. Milt Shapp had just resigned from the Board, possibly his systems had been sold and he didn't have a basis for being there any longer or some similar reason. He also resigned as the chairman of the Pole Attachment Committee. So I was asked to head that committee. Since I'd had some experience with Milt on it, I guess I didn't feel too uncomfortable.
It was about that time in NCTA, I wouldn't guess the exact year, but the copyright case hit us. That occupied NCTA's attention for a good many years. I served on different committees. I served on a nominating committee a couple of times and a membership committee seeking means to attract new members to NCTA. I was elected Secretary of the organization, probably around 1963 or so. Frank Thompson, whom I had succeeded as Secretary, said, "You know, you ought to keep your own minutes." I don't know if he didn't trust the staff or what. When I was Secretary I wrote out the minutes and sent them to the General Counsel for his review and corrections and for him to put into proper form.
All of this time, I continued as chairman of the Pole Line Committee. We were one of the most active committees because of the nature of the problem. From that point alone, and the fact that I'd been going around the country appearing on different matters relating to pole lines, my name became known. In any case, for the 1965-1966 year, the chairman of the Nominating Committee, Fred Stevenson, approached me and asked if I would be willing to serve as chairman. I said, "Well, yes, I would. It would be an honor, but I would be willing to serve anyway."
So I was chairman in the year 1965-1966. Fred Ford had come aboard as the president. Fred was former chairman of the FCC and was a highly-respected figure. We hoped that he would be Moses to lead us into the promised land. During that year and toward the close of my chairman year, unfortunately, the first phase of the copyright case was lost. We, of course, appealed. Not that year, but later on. We lost the appeal but finally won in the Supreme Court.
During the year, also, the FCC was proposing certain measures to take us over and there was even a bill proposed in Congress that never passed. Several of us from NCTA, including Fred Ford, and other operators, testified.
What really stuck in my craw that year, was that people like Westinghouse were getting into cable and they also were broadcasters. It just burned me up. A lot of these broadcaster/cable people would come in and say, "Yes, we're cable operators. We think that feature of the bill is all right. We think we can live with that." To me this was a terrible posture to take. It undermined what we were trying to do.
I recall making a report to the membership in the end of my year at the Miami convention. I antagonized even a lot of cable people because I expressed, in essence, my disgust with people who were broadcasters and who were trying to shape our policies and our association to suit broadcast ends. As a result of that talk, Storer Broadcasting pulled out of the association, and I think people like Marty Malarkey were disgusted with me because I was alienating broadcast people. I didn't care. I have been up to my eyebrows with people who wanted the benefits of cable, but just as an adjunct to broadcasting--as an insurance policy--not as an end itself.
After my Chairman year, I went on back to being the Pole Line chairman. Eventually, I was offered the Board position and came on again in the 1970s for another term of three years. Through all of this I pretty much remained chairman of the Pole Line Committee.
During my term as chairman, we changed the name to the Utility Relations Committee, which we thought would be more significant in terms of our activities. We were dealing with all kinds of utilities and on matters not always related to poles. Principally, the subject of public utility status. At the end of my third term, in the '70s, I became much less active in NCTA. Bud Hostetter took the reins of the Committee and did one hell of a good job. He was the one who saw it through to the eventual enactment of a Pole Line Bill.
That, in a brief capsule, was my NCTA career. Of course, a lot more went on.
Oh, I have to say that one of the bright points of my, and many other people's, NCTA careers was being associated with the NCTA General Counsel, Bob L'Heureux. Bob was from New Hampshire. We called him the Wild Frenchman. He came aboard in 1961 at the San Francisco convention. He and I became very close friends. We worked very closely on the pole line matters. Poor Bob. He got cancer and died in the late '60s. In his memory the Cable Television Pioneers started a Bob L'Heureux Scholarship Fund, which lasted for a while, and promoted scholarships to Bob's university, Georgetown. Marty Malarkey and I used to work together on that. I think Marty was the treasurer. I just wanted to bring Bob's name into this. He was a marvelous man.
DUDLEY: Would you talk more about the copyright problems you had, at that time? Because some people may listen to this tape and not get into other tapes. How about Strat Smith? He, also, had something to do with the NCTA in its name change.
CONROY: Yes. I think the station involved was WSTV, owned by Russcraft. The case was originally brought against the systems in Clarksburg and Fairmont, West Virginia. The basic feeling of the broadcasters was that cable people were pirates. We were taking advantage of other people's efforts, and not paying them adequately, not compensating them for their efforts.
Our argument, on which we ultimately prevailed, was that we were not a program service. We were a master antenna that did not change or in any other way alter the signals. We were a master antenna service. This was the theory upon which Strat Smith and the law firm of Cleary & Gottlieb was building the case. As a result, taking the advice of our attorneys, we were probably ultra-careful, in those days, not to mar what we called the simon pure image of community antenna television. We were merely a transmission service.
When Irving Kahn first appeared at the Miami convention in 1960 or so, he talked about what he called Participation TV or Key TV, which was pay TV. A lot of our people, if not horrified, were shaking because they didn't want to be associated with being a program service. We weren't a programmer; we were just a re-transmission service. As time went along, even while the suit was pending, it was easy to see that cable was going to have many more uses than just being a re-transmission service. Particularly, in closed circuit television and even showing movies. A movie experiment had been done down in Bartlesville, Oklahoma, around 1958, I think.
However, we wanted to keep the image, in any case, of a master antenna service. Even to the extent of keeping the name of the "association" intact, the National Community Television Association.
This came up, initially, as an issue when Bill Daniels, who was always one of the more forward thinkers of the industry, thought that the name ought to reflect more of the name of the business we were in, rather than the narrow view of the business we would like to be in. Not the rather narrow business of community antenna. I know it was at the convention where I was the outgoing chairman, Bill made the proposal from the floor at the business meeting. Discussion went on for some time. I think Strat Smith was sitting there, mute, just hoping we wouldn't do it. I kind of looked over to him and he just shook his head, "No." I proposed a motion to table, which was seconded and passed right then and there. I think Bill Daniels was a little put off by it. It was he who presented me with an award later that evening, and he said with a smile, "You almost blew it this afternoon."
We went on, of course, ultimately to prevail in the copyright case at the Supreme Court, and the association was renamed the National Cable Television Association. Because things looked so dark for us during my chairmanship year, we resolved to seek legislation to solve our position in the copyright issue. That was somewhat controversial at the time. We didn't have the benefit of hindsight. We just saw that we were up to our armpits in alligators, and we needed a way to get out of the swamp.
At the time, we had members who were very close to Senator McClelland of Arkansas. One of them was George Morrell, President of Mid-West Video. Senator McClelland was chairman of the committee or sub-committee of copyrights, patents, and whatever the committee name was. Since he was from Arkansas, and George Morrell was one of his constituents and supporters, he was regarded as at least friendly to our cause and was willing that we be heard. Tom Brennan, his administrative assistant, was working with us to formulate the right kind of bill. Well, the bill went through many contortions along the way, particularly with the movie producers and other program-rights holders putting in their views. But the basic decision was made back in that year, 1965-1966, that we would, indeed, seek a legislative way out of the mess that we were in. The bill pended for a number of years because of the problem of getting the support and getting it passed in the manner that we wanted it. We wanted a compulsory license. We just wanted one place to pay. We didn't want to have to pay all the various program people. There were other facets of the bill, not the least of which was the amount of payment, that went through a lot of contortions, as well.
The problem, however, was that when we won in the Supreme Court, we could not just turn around and tell the Congress, "Well, we won, so we're not going to play your game anymore." We had already been caught in that thing back in S.2653 in 1960 and we just couldn't do it. We'd gone forward too far; and, furthermore, it was readily apparent that some law was going to be passed. With the copyright holders, the movie people, and the broadcasters, all of whom were involved in program rights, some kind of bill was going to be passed. We wanted it to be, as much as possible, our bill.
Ultimately, of course, the thing was passed. There was a lot of contention, at that time, in the cable industry, which resulted in the formation of a second association, the Community Antenna Television Association (CATA). It still exists and I honestly think there is certainly a place for both associations. NCTA has largely gotten to be the association of the bigger companies.
On copyright, that stays with us. There are proposals today to revamp it and, by law, the Commission is talking about syndicated exclusivity again. The more things change, the more things stay the same, it seems. A fellow could be out of the business for twenty years, and come back in, get on board the NCTA Board, and feel, my God, this is where I came in.
DUDLEY: That Supreme Court case, is that Smith and Cole?
CONROY: Well, it was Smith and Pepper. Strat Smith, by that time was no longer general counsel, he was special counsel. We had other outside counsel, Cleary-Gottlieb was the firm. I think Bob Barnard was our particular man from that firm. At every Board meeting we would hear from our attorneys, the status of the copyright case. I remember Bob Barnard was in the back of the room one day and he was wondering when he was going to be on the agenda. We were all familiar with him by that time, simply because at every meeting we'd hear about copyrights. I remember shouting out, "Bob, you come right after the acrobats!"
DUDLEY: The counsel for the other side was verbal.
CONROY: Louis Niser. That's right. Louis was well caught up in his own reputation, pretty much. I say that with a smile, but believe me, our attorneys realized they had a real upward fight, fighting Mr. Niser because he had a good track record. Right prevailed, of course.
DUDLEY: Let's talk a little bit about another group, not an association but another group, the Cable Television Pioneers.
CONROY: This group formed in June of 1966 in Miami at the convention. The person responsible for founding of the group is Stan Searle, who was then publisher of a trade magazine. I think Stan took a leaf from the broadcaster's history because I think the Broadcast Pioneers were initiated by a magazine, if not Broadcasting Magazine. Stan sent a questionnaire to people who were prominent in the industry, board members, previous board members, heads of companies. I don't know how many he sent out. I think he said he was going to pick the top twenty or twenty-one. If not a popularity poll, it was at least a prominence poll, who's in the news now. Certainly, there were any number of pioneers who were not initially named in that first twenty-one who had been in the business longer than many of us who were named. In any case, there were twenty-one people named.
I think there was some wondering at the time, "Well, here it is. What are we going to do with it?" Fred Stevenson of Fayetteville, Arkansas, one of the original ones named, took it upon himself to become the first president of what he called the Pioneer Club. I've always disliked calling it a club, but I don't know why. I would prefer to have it known as just the Cable Television Pioneers.
In any case, Fred sent out a series of memos and questionnaires; I've got copies of all of these. Fred became disenchanted with being a self-appointed president because nobody answered his mail. In his final memo he said, "Well, I've heard from so-and-so, and so-and-so, but I haven't heard from all these people." In essence, it was, "To hell with all you people. I'll get back to Fayetteville, Arkansas, and I won't bother you anymore."
I remember talking to Bill Adler and saying, "Let's plan to get together every year at the convention and make an affair of it. We'll be having a dinner, and maybe we can dress up in tuxedos and have emblems of some kind. But let's do something with it." So I called Fred and said, "Fred, why don't you send me your files and maybe I can do something with this thing." This was back in our Genco days and I was in Austin but not living in Austin. We didn't move to Austin until 1968. So Fred sent me his files, and taking a leaf from his book, I didn't send out things that people had to answer or write. I sent out questions and all you had to do was check yes or no and send it back. That seemed to work.
I guess our first dinner was in 1967 at the Chicago convention. Back then the whole convention, including exhibits, could be at one hotel. We had a formal dinner and most of the original twenty-one were there with their wives.
During the early Pioneer dinners, we were our own entertainment. I remember that first one. Everyone got up and reminisced about this and that, most of them were really funny. I can remember George Barco. He told a couple of really risqué stories that surprised the hell out of all of us. I wish I had been able to tape that session. George really took us by surprise. I can't recall, I would have to look at my records to know if we took any more people in in 1967. I guess we did because we had the celebration this year.
In the early years, I was sort of the executive committee. I treated it as if we had a big bunch of people in charge. I'd talk about the executive committee meeting and being in continuous plenary session for the last three weeks, but I was the executive committee. L'etat, c'est moi. From one of the French King Louis': "The State it is I."
The second year I sent out a list of the people who were Pioneers and asked the members to propose additional people. Then I'd send out the names, the members would vote, and we would come up with five or six or something like that. We were more selective in the beginning, therefore, we didn't grow too fast.
We kept having the dinners. I think I was dinner chairman for the first two years and then other people did it. Frank Thompson did some and Al Malin did one. Eventually, I passed this on to Beverly Murphy who worked with Wally Briscoe at NCTA. I kind of guided her along as she did it then. She passed it on to Bill Adler, who did it until the end of the '70s. I think, one year Bill opened the flood gates and let in about seventy people. That, I think, was a mistake. We should have stayed at only five a year. Bringing people in en masse, I think, cheapened the whole process.
In the early years, we gave the new members plaques with a picture of a television set. Stan Searle started that. When I was handling it, I found a place here in Austin that could duplicate the plaques. So every year we would have plaques made and during all the first early years, Pioneers got those plaques. When more people became inducted, it became too impractical.
Bill Adler handled it until, oh, I think my files would show, around '77 or '78. And by that time, I think Sandford Randolph had retired. I suggested to Bill that he was the one to drop the sack on that. I said, "Let's have Sandford do it." Bill moved all of the files that he had over to Sandford's, and with Sandford, I've kept behind the scenes and working on it with him. Together we really run the thing.
I've been convinced for quite a few years that we've got to organize more formally to insure more continuity. I told Sandford this last convention, "You've had a taste of mortality this year and I could drop out of an airplane any time. We need to do something to make sure that this thing is perpetuated in the form that it ought to be." I think the first thing we'll do is review the by-laws. A couple of previous dinner chairmen, Polly Dunn and Frank Thompson, have also sat in as sort of a quasi executive committee. But Sandford and I have really been running the thing.
Back in 1974, and I've been reviewing my correspondence because sometimes you forget some of the things you've done, but I have copies of the questionnaire I sent out to the pioneers. I asked if members were in favor of a Cable Pioneer Library, just to collect the materials relating to our history. Also, material currently being published should have a central repository somewhere. Many replies came back in the affirmative with some qualifications. A lot of people felt we would need the proper funding to do it. But for one reason or another, this never came about.
I began some correspondence in the late '70s with the Broadcast Pioneers and secured some material from them including a copy of their by-laws, which I can no longer find. Not that we have to ape those people, but rather than reinventing the wheel, we could see what theirs looked like and adapt them for our use. Once we do that, I will circulate them to Frank and Polly and then we'll probably get ourselves a little better organized, more formal than we are now. I don't want to do it in any way that will increase costs, I don't want to open up a Washington office, or any of that business.
About this same time, too, my interest and that of other Pioneers was that we really should do something more than just a dinner and drinking society once a year, something that would be of some value to the industry. The idea of a museum crept into my mind. Not because the broadcasters had one, a lot of industries have them. There is a telephone pioneer group and they have a museum.
So this began to come into my mind, without any specific form. I did correspond with the people at the Broadcast Museum, but their Pioneers and their Museum are two separate entities. I think the Museum was started by William Paley. It's a good Museum. They have all kinds of displays of old television shows and radio broadcasts and so on. My specific interest in doing something about a museum for us stems from my membership in the U.S. Naval Institute, a professional society for people interested in the Navy. It's not just former naval officers. It's a professional association and there is a monthly magazine. There are also a number of other activities, including an oral history program. Once I found out about that I sent for a listing of what they had. I noticed there were oral histories of several of my former commanding officers, particularly those on the New Jersey. So I sent for the parts of their histories that related to the New Jersey. These were available for a small copying fee. I was very interested in what they had to say. Obviously, a commanding officer of a ship is going to have a different perspective than a division officer.
I think it was three years ago in Las Vegas, after the Pioneer dinner on Saturday and we were promoting a little afternoon get together, voluntary, open bar, snack for people. I had called George Barco in advance and said, "George, I want to bring some materials and let you look at them and see what you think." So I brought copies of the oral histories and talked to George. I think Yolanda, his daughter and partner, was there, too.
He said, "Well, this is very interesting. We have the Pennsylvania Association and we have quite a long-standing relationship with Penn State." He said, "What do you think if I go to them and see if they'd be interested in having a museum there?"
I should backtrack. I'm sorry I didn't think of this before. I'd asked Sandford, I said, "Sandford, write a letter to Bill Daniels," because Bill had just built a new building in Denver. I said, "See if he would like to devote some space to a museum or exhibit and so on." Daniels wrote back and said he didn't want to fool with that. So this, then, led me to talk to George.
It wasn't just oral history, I was thinking, of course. The historical equipment, documents, old franchises, pole contracts, pictures, newspaper stories, books about cable from the Rand group and others, old court cases, you know, just gather stuff together. I really hadn't given a thought to the entity as it is now evolving.
George said that he would talk to the Penn State people and this led, ultimately, to that meeting we had in March of '85. Of course, George had done some negotiating back and forth, and he and Marlowe Froke from Penn State, and others, had come up with a basic document. That was circulated around to me and to Sandford and to George for review, and some changes were made. It culminated in our meeting at Penn State in March of '85. Which sort of brings us up to date.
I'm very hopeful that we can formalize the Pioneers a little more. It is sort of formless now. I don't want it to become administratively heavy or anything like that. I think we ought to have a group of five or six people to act as a Board of Governors of some sort, some way to replace ourselves. I would just as soon pass the reins on and let somebody else do it. I'm not trying to perpetuate myself in this executive committee business.
DUDLEY: Before we leave NCTA and these other associations, tell us a little bit about the Larry Boggs Award. You were a recipient of that award, I understand.
CONROY: Yes. Larry Boggs, of course, was a true pioneer. He was in it in the very early days with Henry Griffing and a few more. Larry was the vice-chairman of NCTA under Glenn Flinn. Larry became sick, I'm not sure what he had, might have been cancer, but he got sick and he died during that period.
I remember one board meeting where a number of us got on the phone and we were talking to Larry. As a direct result of Larry's death, Glenn Flinn served two terms as NCTA chairman. I do not know who instigated the idea of an award. The idea came along for meritorious service for the association and for the industry and so forth. It was decided to name it for Larry. They gave other awards, but they wanted this to be THE prestigious award. I think the first recipient was Bill Daniels. Yes, I was the second. I think Bill was careful to explain that the reason I had got it was not because I had gotten through a year as chairman. That wasn't the intent and that wasn't how the award was going to be handled. My work on NCTA committees came into it. It was given to me as a means to encourage operators of small systems who would take the time and use their resources to work on behalf of the association and the industry. Really, I think it was just as an encouragement to everybody to devote time to NCTA work. You didn't have to be chairman, you didn't have to be the head of a big company. I think there was a lot of that feeling behind my selection.
End of Tape 3, Side A
DUDLEY: Ben, how about some of the other businesses that you have been involved in, in addition to cable, and to management and consulting.
CONROY: Okay. In Uvalde, in the early days, I was having a difficult time persuading the motel owners to install television in their rooms and to subscribe to the cable. They didn't have any TVs in the rooms. So I came up with a thought: maybe the best way to get cable going in motels was for me to do it. So I proposed to one motel owner, "I'll provide some sets; I'll pay the cable fee; I'll take care of the installation cost, if we could put TV into some of your rooms. Let's just try it out." I proposed to split the revenues.
In the beginning, I put in TVs equipped with little coin boxes. I think we might have done a dozen rooms to start with. I did it through some TV dealers in town. They gave me a little cut. I got some small, portable sets with eight or ten inch screens. I bought some kind of device to turn them on and off using coins. I think it was a quarter. I got it going that way, later expanded to other motels. Obviously, once one guy does it, the others do it. Eventually, we charged an extra dollar a day instead of using coins. Customers would come into the motel and be asked if they wanted a TV room or not. It was another dollar for the TV.
I actually made a little money out of this thing. I paid the cable regular fees. I did give myself a break, however, in wiring because I charged myself the actual cost of labor and materials. We'd normally throw in a 10 or 15 percent override. But I just charged myself actual cost. I guess I made some money. Ultimately, this was taken over by a TV repairman friend of mine, Tom Winkle. He bought the sets and paid a little bit for the good will of the business and that was it. Ultimately, of course, I guess he sold everything back to the motel people. Now there are many, many more motels and everyone has cable. As a matter of course, I did have trouble getting it started.
Another business I put myself into concerned background music. In 1960, or thereabouts, we went from three channels to five channels. I say three but we started with two. In 1958, an ABC outlet started in San Antonio, so that gave us the three networks. By microwave we were able to pick up and bring in the Spanish-language channel, 41. In 1961, the educational channel, located between Austin and San Antonio, came on the air. We put that on but we had to use microwave for it. It was at a point north of San Antonio but the reception was not good from the Uvalde site because of the distance. So we microwaved.
In connection with the broadband, low band, five-channel system, we also added FM signals on the FM band, which is right up above Channel 6. We made that available to our subscribers on a second connection basis. That is, if they wanted to put two sets in, we would install a splitter and hook up two sets. If they wanted us to hook up their FM radio or tuner, we would put a splitter in. I used to tell them, "I don't care what you hook up to your second connection, a radio, TV, your refrigerator, or your dog. It's a second outlet."
DUDLEY: That was at second cost, right?
CONROY: Yes. It was a dollar or a dollar-and-a-half a month. It wasn't the full charge. In addition to that, we put on background music. We sent to, I think it was Tapeathon, for the background music player console and subscribed to them for the tapes. A lot of it was pretty bad music but we had it on. I don't think Muzak would deal with us. Muzak would not permit their music to be run on systems. So we got the music elsewhere and it was free to subscribers.
In fact, at the same time, we put on a weather channel. The man who designed it was Lloyd Calhoun, from Hobbs, New Mexico. He served a term at the end of the '50s as chairman of the NCTA and had been on the NCTA Board for quite a while. He designed this weather channel and it was the prototype of all weather channels.
Our weather channel featured an arm with a TV camera swinging back and forth, and at the far end of the swing, we could put messages on. It was just a continual rocking-arm arrangement. Of course, with every innovation comes problems and we had to be sure that our temperature gauge and rain gauge were right. Often, they weren't. None of this was electronic; it was just a camera taking pictures of things. We carried this on our Channel 6, and for audio we used the background music. We also carried the background music on a separate frequency on the FM band. Just to keep the goodwill of our radio man in town, who had an AM radio station, we carried the AM radio signal on the FM band. We could tell him we weren't trying to undercut his market. I guess he was pleased to have it on there.
In any case, we had background music. I had begun to read about some systems putting this music into stores on a commercial basis. I became interested in that, inquired around and found a few merchants who would like that. I remember talking to the NCTA, at the time, asking about any legal ramifications of this and what about music license fees and so forth. Well, they said, "You're going to have to sign up with ASCAP and BMI." In fact, as soon as we started getting music tapes, the ASCAP people were after us. This was all being done on the cable company basis. Cable did it; I was just promoting it, just part of the service. We got quite a few accounts, I'd say a dozen or fifteen accounts. I forget how I based the fees but it was certainly far less than a comparable Musak arrangement would be. I was paying ASCAP via my fees to the music customers.
As time went along, I think it was Strat Smith who advised, "You know, we're in this copyright suit. It might be better if you did this as a single proprietor rather than as a cable company." So I said, "Okay." And I had a meeting of myself, the single proprietor, and myself, as the manager of the cable company, and we arrived at an equitable figure for me to pay for the connections. I rented the music from the cable company because, really, the music console should have been, and was, used as part of cable service. So I just paid the cable company a fee mutually arrived at for the use of their music. And this went on for several years. It made a modest amount of money. In fact, I had it until we moved to Austin and then Faber Spires became manager of the system. Ultimately, the Musak man from San Antonio, who also ran an FM station there, tried to expand his business into the smaller towns. He used Musak and he had a background music system operating in San Antonio over the air. At any rate, he wanted to buy my business. So we negotiated around for several weeks and, ultimately, I just sold him the thing at a fairly nice profit. From that point on, I was out of the background music business.
DUDLEY: How about radio? KRIO radio?
CONROY: Okay. Let me backtrack again just a little bit. A year or two before we moved to Austin, I got interested in putting in an AM radio station. Not in Uvalde, but in Hondo, a town east of us in which there was an opening for a frequency. Hondo is an interesting place. You can go through there today and see a sign, "This is God's country. Don't drive through it like hell."
Today, Hondo has a cable system. In those days, it seemed too small to support one. I actually hired an engineer for the engineering survey and got an AM grant for a radio station there. If I had stayed in Uvalde, I probably would have put it in. I was doing it with an engineer from the local radio station who moved from Uvalde to Kerrville but was anxious to come back and operate the radio station. I was going to do that except that I came to Austin and my ownership would have been too much of an absentee ownership situation for me. So the newspaper fellow in Hondo got interested, and I sold him my rights to that radio station. It was the amount I had in it because the FCC doesn't permit you to traffic in licenses. You can sell it for what you put in it and that was it. Essentially, I got my cost out of it. So I had a brief brush with being a radio operator there.
Later on, some people from the CPI group and others had an opportunity to buy a radio station, KRIO. I'm sure that they got that call sign from the Rio Grande, but KRIO was down in McAllen, Texas. I don't think Bob Hughes was in that. Fred Lieberman was in it; I was in it; Bill Arnold, Jack Crosby; and probably a couple of other people, including Floyd Shelton. We all made an investment and the manager was Charlie Trub. We had that investment for several years.
In fact, I think some housing was built out of that investment. So I guess we were in the residential rental business for a while, too, in McAllen. After the late '70s, I think it was around '77 or '78, we had a good opportunity to sell at a nice profit. As a matter of fact, shortly before that was done, I divided it up into seven portions: one each for each of my children and I kept the stock that was left. When we sold, I was not only able to have a lower tax rate because of my children's involvement, but I immediately put their shares into a bank trust which later became the basis for their educational funds. A lot of them have had advanced education because of my involvement with KRIO.
Editor's Note: The following was recorded after the interview was completed. The audio is on the addendum cassette.
I have mentioned Floyd Shelton, who worked with CPI. I'll have to say, may he rest in peace, also. He died a few years back from cancer. Floyd's career had mostly been in the operation of radio stations. For a good while, Jack Crosby, who had gotten into radio in Del Rio and a couple of other places, had Floyd acting as his man to handle the radio properties. With the formation of CPI, probably around 1969, Floyd was brought into CPI as what would be called, today, a corporate developer, trying to get the franchises. This was pretty much Floyd's full-time venture. He was a dyed-in-the-wool radio man, commercial radio.
I remember one time we were riding up and down the streets and alleys in Columbus trying to carve a piece of that city as another system for our empire but we were not successful. Floyd was driving, I was just flipping around the radio dial and I found a non-commercial station which had some pretty good programming. I was just enjoying listening to that and we were looking to see what the conditions of the poles were in that part of Columbus. Floyd eventually said, "You're going to have to shut that damn thing off." He said, "It makes me nervous. I don't hear any commercials. Put it on a commercial station. I have to hear the commercials. This drives me out of my gourd." He and I were at opposite poles in that regard; I like to hear radio without commercials. Just to know the station was making money, Floyd had to hear the commercials.
End of insert
DUDLEY: What was MRI systems?
CONROY: MRI Systems was a software computer company. It was a data base management system. This had nothing to do with CPI but was purely an investment on my part. I served on the Board of Directors. It was a local company here, started by people who were then still active in the computer science department at the University of Texas. I don't know how university people can do this but, somehow, there seems to be no conflict of interest for them.
I think I got involved in that around 1969. It had a lot of promise but went through some very tough years. MRI Systems, originally, stood for Management Research International, or something like that. It was touch and go. We had monthly board meetings and, ultimately, we had a happy ending. Intel Corporation of Santa Clara, California bought out all of our interest and made us quite a little money. I was in that with Jack Crosby and Bill Arnold as well as the MRI people. We came into that investment because the university people were friends of Bill Arnold and I had met them in connection with my interest in sailing out at the Yacht Club at Lake Travis here. Jack Crosby is always interested in investing in things that look promising. We ended up all making a tidy bit of change out of that.
DUDLEY: How about Conroy Management Services?
CONROY: Once CPI had been sold to Times Mirror, that was a management company that I formed to operate the cable systems that I had started on my own. Following that sale of CPI, I decided I did not want to be with a big company any more. I could have, if I had gone to California, but I didn't want to and there was no real place for me out there. So I thought, "I'm going to have another shot at the cable business and be an actual cable operator again." I didn't feel that I had been a real cable operator for quite some time. When you're running an MSO, you're several layers above where the action is.
So I tried quite a few small towns and was successful in four of them. One was Elgin, a town about twenty-five miles east of Austin towards Houston. Another was Pleasanton, south of San Antonio. Then two towns near Corpus Christi, one was Sinton and the other was Port Arkansas. I had long been familiar with Port Arkansas because my family and I had been going down there since, oh, about 1968. It's a small resort, fishing and tourist kind of place. Lots of beach activities.
So I got franchises to build systems in all of these places. It's interesting that in two of them I was able to keep any rate regulation out of the franchise and in the other two the cities wanted that regulation. In fact, bear in mind these were small towns and one of them (Sinton) was using as a model the franchise that had been used in the city of San Antonio. It took quite some persuading to explain that all those access channels were not applicable in a town of six thousand people.
I recall very well the first time I was over in Elgin (pronounced with a hard "g"). We were talking about rates, and I had presented a model franchise to the council and said, "Well, I haven't put anything regarding the regulation of rates in here. There are a number of roads that you can take. You can just decline to regulate them at all, or you can regulate them with as heavy or light a hand as you see fit. Or you can regulate by a negative regulation; that is, have a maximum charge and anything over that you can regulate." I recall one councilman got up and said, "It seems to me in this kind of a business, you could charge two dollars a month and get all the families in town and you'd probably lose money. Or you could charge $20 a month and you might get a few of us, and you'd still lose money. So I don't think we have any business regulating rates." So he made the motion that they not regulate, and I just kind of smiled and said, "Well, I think you've chosen the right course."
And, as a matter of fact, I never did abuse that. I did raise rates one time, but that was just shortly before I sold. I think that I was able to show them justification. I went before them and explained what I was going to do. They conducted that particular hearing just as if they had regulated rates. Frankly, I feel without regulation, it is best for any operator to go before his governing body and give the rationale for why he is increasing rates. Those are the people who often take the heat from their constituents on the rates and, at least, this way they know what's coming. They can explain, giving the reasons that the cable operator gave. I think that I was able to persuade them that this was justified and that it wasn't a heavy-handed increase.
As a matter of fact, I was able to get rate increases in all four towns. In one that regulated rates, it was a little more difficult. In those days, the interest rates were up around 22 percent, and I just said that this was a cost that I had not anticipated, and I felt I needed the relief. In any case, that was the main thing. I was happy to have at least 50 percent of my four towns not regulating that aspect of the business.
CMS. I'm going the long way around to answer your question. Conroy Management Services was a separate corporation. I had all of these formed up as small business corporations, sub-chapter S, because I had a few other investors in with me. Conroy Management was a separate corporation formed for the sole purpose of performing management services for the four systems or any other systems that I should be interested in. I owned 100 percent of the stock in the management company. CMS was simply a conduit and there was no profit factor built in.
One reason that led me to form it this way was my experiences with CPI. I felt it would be much easier if the people were employees of my central management company. I could move them around from system to system, if the time should come, without worrying about the tax forms that were needed for each place. It was a much easier way to run things. CMS bore all of the cost of promotions and, basically, assumed a lot of the cost of the systems. The costs were reallocated to the systems under a formula based on the combination of potential and actual subscribers, at the time. It was a non-operating management unit. When I sold the four systems in 1982, I kept CMS around just in case it would be useful to have a shell corporation. Ultimately, I decided that I had better liquidate this one. I was beginning to be taxed on things that had no basis in reality. So I just let that go, too.
DUDLEY: So those four systems had some sort of a maintenance staff?
CONROY: Oh, yes. Each one had a technician. CMS consisted of myself; a good engineer; a secretary; and I had another lady who was really my vice-president of administration. She handled all of the details concerning the offices, billing, payroll, and that type of thing. Each system had, at a minimum, a technician, who did as much maintenance as he could; my engineer took most of the people on pretty cold. They were taught to do hookups and maintenance. We also had a lady in the system's office. In a couple of the larger systems, we ended up having a girl-and-a-half in the office or sometimes two. The second one, on a part-time basis. In the early promotional days, we had one or two technicians or hookup people. Although, often, I would bring in contract installers to do that. We were operating pretty lean. We weren't heavily populated with people.
I was able to experiment with some interesting rate structures. The first system we built in 1979, during the brief time I was on Times Mirror's payroll. I wasn't really doing much for them so I was starting this enterprise. I had a rate where we had about ten or eleven channels, basic. I had at least two pay channels on all of the systems and some, where there was a significant Spanish population, I had three pay channels. The third being Galavision for the Spanish language programs. Then I had another group of four, five, or six satellite channels; a variety, ESPN, WGN Chicago, etc. I called this SatPac like a six-pack of beer, but this was SatPac. This was sold as a separate entity for two and a half or three dollars a month. We charged for second connections, a moderate fee, a dollar and a half, I think.
We rented converters; we didn't put those in automatically. In fact, the converter rental got to be quite a little profit deal for us. If people wanted to buy them, we would sell them. I did not feel that I wanted to be in the converter business. I often wish that these had been built right into the set. We actually made money on them.
By the time these systems were sold in 1982, we had built up our average monthly gross, per subscriber, to about $23. Even today, in 1987, that's a pretty good figure. The combination of the various rates we had really built up our cash flow and gave us a nice average monthly gross per subscriber. I was very pleased with that.
DUDLEY: At one point, you were also licensees for translators.
CONROY: Oh, that's correct. This gets back to a little self-serving business back in the Uvalde days. In those days, any time someone started up a business like cable TV, you were going to have people who figured they could do you one better or beat you out of it. This was after the FCC had authorized UHF translators, which received VHF signals, translated them and rebroadcast them on UHF frequencies. We had a parade of translator people coming through town, talking it up with the television dealers. Some of them even set up demonstrations to show how great this idea was. They could provide no better signal than we and, as a matter of fact, theirs wasn't as good. They didn't begin to have the height on the tower, and once we put in microwave, they couldn't begin to duplicate that. In the early days of translator activity, I was concerned about this, just as I was concerned about anything that might come along and pose us a threat.
At one point, there was a group in town that proposed to start translators in Uvalde and have repeater points in a town to the west of us, Brackettville, and then branch off down into Eagle Pass and over into Jack Crosby's town of Del Rio. Jack was concerned about this, too. He and I worked together in the early days of the translator activity to try to head it off. I was getting all kinds of advice from Strat Smith and Bob L'Heureux.
I decided to apply for one translator myself, thinking that I would have one operation and it might preclude further activity. Well, I got one, probably on Channel 79 or 77. We were really, in all honesty, feeding the signal out to the jack rabbits. I think the FCC rules, at the time, may still apply: you could not put a microwave signal on a transmitter, so this had to be an off-the-air signal. It was only as good as our regular off-the-air signal, which wasn't nearly as good as the microwave we were using, at that time. We were actually serving some people.
I developed a scheme to try to get them to pay a little money. I used to visit some of the rural places that we couldn't reach by cable and tell them about this service, see if they were interested in subscribing. One channel alone wasn't too adequate so we just operated the thing. I think some people were picking it up. To do this, they needed a UHF antenna and a set-top UHF converter to receive the signals on their VHF sets. As the translator activity began to increase, I applied for two more channels just to try to further block anyone else from coming in. On this one, I proposed to the Commission that I would serve the northwest corner of Uvalde. Actually, I would be competing with myself. I think the Commission was casting a fishy eye in my direction, thinking who does he think he's kidding? They ended up approving the request.
I remember frequently calling a man named Jim Sheridan at the Broadcast Bureau. He knew I was in the cable business. I had gotten to know Jim a bit from my trips to Washington. He and I shared a love for jazz music. I'd call him and we'd talk about music for a bit, then I would ask how my translator applications were coming along. He finally would say, "Okay, next week we'll get them." And I did.
We actually had three of the darn things, and I must confess, although the rest of the translator activity died down, there we were with our translators. The dog had caught up with the taxi cab, and what's he do with it now that he's got it? We operated those things, and some people in our service area were actually using them. We didn't try to get fancy, shutting them on and off. We didn't give them the same maintenance that we gave our cable system. I don't think we ever suffered a great deal. The things are still there. I understand that the Uvalde system has actually sold them to that same TV dealer who bought my motel television rental business. I guess he's trying to make a business out of these things. That was not a business that I was too happy to get into. I did it as a means of insurance and some degree of self-protection.
DUDLEY: Following up on that, what sort of perceptions did you and other early operators have of what the cable business was going to be? Some tell us that early operators figured that they had a three-year window or a three-year life until the allocations table came out again. What was your perception?
CONROY: When I got into the business in 1954, actually starting a system in 1955, the Sixth Report and Order was, indeed, a fact. So we knew what the allocation table was going to be. I think that came out in 1952. I think we felt there was some possibility that something might come along and make our service obsolete. I remember my father writing to me, saying he'd read a report in the paper about the FCC proposing to allow television stations to operate satellite operations. I don't mean in the air as we have them today, but it would simply be a master/slave type of station relationship. They would be able to put virtually a VHF translator out into a rural area, and just repeat this signal. We thought, "Well, that could possibly hurt us."
In the case of Uvalde, the stations in San Antonio were talking about putting up a taller tower, a 1,500-foot tower. When we went into business, they were operating basically 400- to 500-foot towers in mid-town San Antonio. They were talking about a 1,500-foot tower in various locations but somewhat south of San Antonio and a little farther west. For a good while I worried about it. Cable customers would say, "Once that tall tower goes in, we won't have to use your cable any more. We'll get perfect reception." I said, "Well, let's wait and see." Well, the big day finally came and on came the increased power. Oh, excuse me, they were already at maximum power, 100,000 watts. This was Channel 4 and 5 in the beginning. They increased their tower height and shared a common tower in Elmendorf, about twenty miles southwest of San Antonio.
Well, a funny thing happened on the way to the new tower; the signal available at roof-top level was less than it was before, because they were a little farther away. Before, they were about eighty-five miles from us and now they were ninety-two. I just didn't hear any more comments. A lot of people were waiting for that to happen, and we got a little rush of subscribers coming on, after a bit. Half the things you worry about never come true anyway, they never happen. There always seems to be some specter just over the horizon. I think the longer we stayed in business, the more secure we felt about it.
I must confess, my conception of that time was never that the cable TV would become what it has become, particularly with the advent of satellites. A lot of people from San Antonio, or other cities, used to come out to see us and they were intrigued by the cable system. In some instances, they would say that it was better reception than they could get in San Antonio. I said, "Well, you could get good reception in San Antonio. You just need a proper antenna." They said, "Why don't you put a cable in San Antonio?" I said, "We can't put a cable in San Antonio. You've got all the signal you need."
The thought that a city like San Antonio would be wired for cable, in those days, the middle to late 1950s, was absurd. In fact, I can remember going around to different towns in Illinois with Jack Crosby and Gene Schneider, towns just south of Chicago. There were one or two signals available and we thought, "God, this place is all loused up with good signals. We don't want to put a cable in there." Maybe Irving Kahn would say, "I always knew it would turn out this way." But at the time, I did not think of cable being available in the big cities.
Some towns, such as Tyler, Texas, even Austin, were one-station cities. The cable operator would microwave signals in and have a full network coverage and maybe an independent. That wasn't too bad. Some operators were going into two-signal towns and providing additional distant signals. It was this kind of activity that, initially, got broadcasters up in arms on cable. We touched on that subject before.
Two or three things happened first. It became possible to go to twelve channels. In those days, it seemed to me that we had a new level of technical competence every five years or so. In Uvalde we went from three channels to five channels in the late 1950s, and a little while after that to twelve channels. Although, I think Al Ricci in Keene, New Hampshire started his system in the mid 1950s with a twelve-channel, Spencer-Kennedy system. Then, of course, we went from tube to transistors. I'm going to keep an anecdote in mind about Jerrold and transistors. Then into eighteen channels, twenty channels, twenty-one channels, and thirty-six channel systems. We had the capability of carrying a lot of channels before we had the signals to put on them. It wasn't until the advent of satellite technology in 1975 that the dam really broke. We began to see that we could start filling these channels with some services.
DUDLEY: You hit right on my next question. The move from tube to transistor and to solid state gave you the hardware capacity to do so much more that you really could program.
CONROY: Yes. Now that we've got all these channel slots, what are we going to do with them? We were really looking around for things to put on. Local origination had been going on since the early 1960s. I know Fred Ford, in his tenure as NCTA president, urged cable operators to get into local origination. It was a means of providing further service to the community. A lot of us did. CPI spent a lot of money on some local origination studios, to the point where we eventually had to cut back. We were a little bit amateurish about it. We didn't really begin to see the promise of filling these channels until satellites and until earth station prices came down and we could use smaller dishes.
End of Tape 3, Side B
DUDLEY: As transistors and solid state technology brought new challenges and opportunities, tell us about the use of microwave and, later on, satellite systems.
CONROY: Microwave had been used before transistors came in. In fact, the earliest use of microwave in this country for cable, I think, was when Bill Daniels and the Schneider brothers put in the system in Casper, Wyoming, and brought one signal in from Denver. Of course, they had to pay the telephone company to do that, at the telephone company's rates. The FCC later approved licenses for other people to get into the common carrier business and to extend signals by microwave and later on to make a provision for CARS-band microwave. That really did extend our horizons. But some people, our opponents, made a point during the copyright case that you can't equate microwave with having just a simple, tall tower and receiving signals.
For a lot of cable systems, microwave enabled them to get basic service. Take Del Rio, as an example. One hundred and fifty miles from San Antonio's transmitters, the only way they could get signals worth anything was by microwave. A lot of the systems out in west Texas extended the signals of the Dallas and Fort Worth transmitters. The independent and network signals were brought into west Texas and various sparsely-populated areas. We built a system in Midland, Texas. It had Channel 2 (NBC); Odessa, down the road, had Channel 7 (CBS); and Monahans had Channel 9 (ABC). This was at the end of the 1960s, so, basically, people in the area could get all three networks. We microwaved in some additional Dallas channels, which provided an educational outlet, and one or two independents.
The value of microwave in the cities that already had reasonably good TV coverage from local signals was that you could bring in those independent and educational signals. When we went to transistors the amplifier was smaller, our power costs were lower, and that, of course, led to the more sophisticated amplifiers that we've got today.
I think the government's own satellite program, putting men on the moon, has brought a lot of technical innovations along that has benefitted cable and consumers, in general. It was the advent of satellites and satellite technology that really boosted and signaled the dawn of the modern cable television age. Satellites--along with the miniaturization (chips), electronic equipment, extending channel capacity and the physical reach of our lines that went into the systems.
DUDLEY: It's really been satellite technology that has turned the cable industry into a new, major force in telecommunications.
CONROY: Yes. Satellites are really a cheap method of delivery compared to microwave. I'm not sure that without satellites we'd see cable television as the force it is today. I think it is going to be an even greater force.
I wish I had the original internal memo from Jerrold about transistors in the late 1950s. At the time, I was working for Jerrold, and I used to get some of the inter-office memos. This was the early days of transistorized amplifiers. I think they were used, primarily, in pre-amps to keep people from having to climb up to the top of the tower all the time to change out a tube in a pre-amp. Ameco was trying them. Johnny Campbell of Mineral Wells was one of the early innovators, in that regard. Westbury Electronics was possibly the first to use them. I think this was in the 1950s when they were just being experimented with. Anyway, some memo was floating around Jerrold that said, "Don't get too excited about these transistors. They're just a flash in the pan. They're not going to work and we'll stick with what we've got. We've tried them and they don't work." So much for prophetic vision.
DUDLEY: Taking off from where we are now, can we talk more about the development of Multiple System Operators (MSOs). They've really been around since almost the beginning of cable, right?
CONROY: Almost. I would say that the late '50s and early '60s was the time when MSOs, as we know them today, began to get going. Before then we had people who owned clumps of systems, two or three or four. I remember when Jerrold disposed of a bunch of its systems to H&B American. Jerrold's man, Leon Papernow, went to manage them. Irving Kahn was beginning to get into the business. I think his first system was Silver City, New Mexico. Bill Daniels was able to sell it in 1959 and then Irv bought Rawlins, Wyoming. Fred Lieberman was building systems and gathering them together. At that point, we began to see the MSO as we know it today.
I've already described our activities beginning in the middle to late 1960s. We became an MSO. Irving Kahn, with his TelePrompTer group, was quickly and very aggressively going after systems. Bill Daniels was instrumental in the formation of American Television and Communications. Bill was trying to sell these systems, but couldn't sell them individually. Monroe Rifkin was operating them. Bill put them into a package and got them financed. It was a pretty good package. Bill also sold a package of systems to Al Stern, who had been working with NBC. This was all right around the same time, the early 1960s.
Periodically, the cable industry had its hot and cool times in terms of running after franchises. Franchise activity and the further formation of MSOs got really hectic in the 1970s and early 1980s. All of that activity began about 1959-1960.
I used to ask different people, "How do you think this is going to evolve?" We looked as though we were going to follow the way the telephone industry had evolved. Although no AT&T has yet come forth, for a while it looked like TelePrompTer might have been it. The telephone industry still has lots and lots of little telephone companies, Mom and Pop operations. I doubt that the regulators will let an AT&T in the cable TV evolve. It will probably come down to twenty to twenty-five big companies.
DUDLEY: With the cable industry now, basically deregulated, and franchises, for the most part, non-existent any more ...
CONROY: You mean no one being granted franchises?
DUDLEY: Yes. And tremendous amounts of capital in the hands of the MSO, where is their growth? What is going to happen?
CONROY: I think they're going to continue to be acquisition-minded. I think a lot of their growth will be internally and from sources that haven't been fully developed before. As an example, I don't know why advertising will not provide a lot of revenue for systems. It is providing some now, but not to the degree that I think is, ultimately, possible. I think that they are going to get more and more revenue from the production of more and more services. Not necessarily charging more for basic. I think there is a limit of how far you can go on that, but I'm thinking of additional service, some that we may not even know about today.
I've often thought that the marriage of computers and cable is a natural one, with information retrieval, even though there isn't a computer in every home. I think it's possible a marriage for cable, computer, and telephone. In some respects, even though the phone company only has a narrow, twisted pair of wires into the home, originating from the home with true two-way cable just isn't practical, at this point. With the telephone companies' expertise in audio and ours in video, some day we may have something happen with the picturephone. The phone companies haven't seemed to be able to do too much or they haven't been able to interest too many people. I think that cable growth is going to have to come from the acquisition of new customers. They don't have every household in the nation wired up yet. They don't have all who are within their service area connected as customers.
Given that, I think that the growth is going to come from an infusion of new services. From the looks of it, there may be even more and more sports going onto cable. I don't know whether we'll see the World Series and the Super Bowl on a pay-for-view basis someday. If that were to happen, it would be another source of revenue. That's been a fear of a lot of broadcasters and some congressmen that, eventually, you'll have to pay for everything that you see now that's free. I just think that there are a lot of internal possibilities for growth.
DUDLEY: Once they've acquired their fill of small companies, you don't see the possibility of the larger MSOs going after each other to eventually create a national monopoly, an AT&T in cable?
CONROY: With the history of what has happened to AT&T, I don't think it will be permitted to happen. In the past we've seen proposals in the FCC to limit growth. There was a whole series of proposals in the mid-1970s, dockets requiring comments. One was, how big should they get? Another, if we are going to limit, how do we limit? We spent a lot of time, and we paid Strat Smith to give us a seminar on all of these dockets. There must have been six or seven that we felt we should provide comments on. That was one of them. I just don't feel that it is going to be permitted to happen. I may be way off base, but I don't think it will happen. We may get down to a handful of big ones, maybe a dozen or fifteen good sized companies. You have one that's fairly dominant now, but it certainly doesn't have over 80 percent of the phones as Bell Telephone used to.
DUDLEY: What about programming? At the 1987 NCTA convention, you could see the growth in the number of shopping networks and the growth in the number of pay-per-view companies. What do you foresee in cable programming in the future?
CONROY: In a way, this gets back to your previous question: What are some of the areas of growth? Pay-per-view is a real possibility. Home shopping is here now, on sort of a network basis, over the satellite. I think we're going to see more and more of cable's being a programmer and not just a purveyor of programs, and a hardware merchant. I noticed, too, at the convention this year, in contrast to even ten years ago when you saw more displays of amplifiers and cable, at this one you really had to look for them. Mostly, it was the computer people, the pay-per-view people, and various other programming entities.
As to an individual cable company programming, a good many are doing local programming. In many ways, cable companies today are in the same position as the TV stations. They are on various network feeds. This is really something I had in mind earlier when I mentioned advertising. Today cable systems are paying so much per customer to receive a lot of these things. In the future, I think it's entirely plausible to expect that these program people will pay us for our customer accounts. In other words, we may look more like network affiliates than we do now.
I remember talking to our marketing man, Greg Liptak, back when the religious channels were coming on and they all wanted to be on our system. We thought, "Suppose we just take the position that, 1) we're not going to pay you; and 2) we'll charge you so much per customer per month to carry your signal. I think that, plus certain amounts of local origination, is what we may expect in the future, particularly as a source of additional revenue. We always get back to that. It seems to me, once a fellow like Ted Turner gets successful enough, there won't be a need for him to charge fifteen cents per customer per month or something but, rather, the swinging door will go the other way.
DUDLEY: Where is fiber optics going to take us in the future? Any opinion?
CONROY: Well, it has a tremendous capacity. The people who have used it say it has tremendous problems, too. It's brittle and it snaps. Irving Kahn has long been a proponent of fiber optics, saying we'd better get into it, or the telephone companies will beat the hell out of us.
I think, at the moment, to the extent that it is used, it is more transportation, point-to-point, for signals. I honestly don't know how many systems today are using it. When I was still active with CPI, I used to ask Jim Stilwell, who was one of our chief engineers, "Shouldn't we be doing something with fiber optics, just as an experiment?" He said, "Well, are you interested in the public relations aspect of it, or are you interested in the actual engineering value?" I said, "Well, I guess some of each. I'd like to seem to be an innovator at the forefront of things." He said, "At the moment, it would be more valuable as a public relations thing than as a medium for transporting signals." This was back in 1979. I know a lot of systems are doing it. I didn't see much of fiber at the NCTA convention this year. It just seems to be low key. I'm not saying it won't have a place in the future. I'm not enough of a seer to say that it is going to be the mode of the future. For a while, I thought, with that kind of capacity, we might be able to put into the home the ability to call up programs just as you want them from a central bank. But you need to get into switching networks for that. You would almost have to build a video telephone system. I'm not going to try to be a real visionary trying to answer that question.
DUDLEY: Let's talk now a bit about something that you mentioned before: relationships with the telephone company and the power company and pole line charges. You were involved in these things for quite a few years.
CONROY: When I came into the industry, the general charge was about a dollar and a half per pole, per year. That seemed to be pretty general throughout the country. Some places it was even a dollar. The power companies seemed to hold on to that low rate. I say low but as time went on and the phone companies were forced to cost-justify this, the dollar and a half looked like pretty much what it ought to be. It was low in terms of the five dollars and seven and a half that they sometimes have asked for. Generally, it was a dollar and a half. The power companies seemed generally content to leave it there. After all, we were good power customers. We weren't just paying a monthly phone bill as to the telephone company; we were paying substantial amounts each month for power. That part of it was fine.
To me the first inkling came around 1957 when I wasn't on any committees. A man named Tom Witt was proposing to build a system in Eagle Pass, Texas, which is on the Mexican border, along the Rio Grande, somewhat south of Del Rio. Eagle Pass was about sixty-five miles from Uvalde. There was a triangle. If you put Uvalde at one apex, Del Rio was seventy-five miles in one direction and Eagle Pass was sixty-five miles in a southerly direction.
The phone company (Southwestern Bell) came to Witt with a contract. One provision stipulated after five years the phone company would have the option to buy the system from him at its then depreciated value. I used to have a copy of it, but I sent them all to NCTA. That was a dead giveaway to us. They wanted to own the business.
At that time, I still had my contract which alluded to restrictions by specifying the contract was designed solely for the purpose of providing community antenna and television reception of off-the-air signals. It didn't get much more specific than that, as our later contracts did. This one, with what we call the yellow-dog provision in there, was a dead giveaway. It had specific provisions for prohibiting any kind of closed circuit and carriage of even FM stations, and they were asking five dollars a pole. The end result was that Tom Witt, mostly, put in his own poles, although he used some power poles. It was the same power company we had, Central Power and Light. As it ended up, Jack Crosby was an investor in that system and Tom Witt was the manager. He never did contact the telephone company poles, and I just kept that contract. That was such a clear indication of their intent and it really had strong anti-trust implications. This was really indicative of the unrest that the phone companies were starting to exhibit.
In 1959, Milt Shapp, chairman of a newly-formed NCTA Pole Line Attachment Committee, organized committees and sub-committees throughout the country, dividing the country into regions. It was primarily the telephone companies that were giving us the problems. The industry used the poles of the Bell Companies, General Telephone, and United and others. But it was, primarily, Bell and General. The complaints of the operators were: 1) increased rates; 2) restrictions being imposed, particularly on new systems; 3) unrealistic bonding requirement; 4) unrealistic insurance requirements; and 5) very unrealistic, make-ready charges. Make-ready being getting the pole ready for cable. These were five main problems that we had with them.
Milt appointed me coordinator of the southwest region. He had me pick, or had names picked, of people in each state and he sent a questionnaire, asking not only what was happening in our own systems but what we were hearing was happening in other systems. He wanted us to call around and ask, "What kind of problems are you having?" and to write up a report. We met, it seems to me, in April, 1959, in Chicago for a two-day session. The first day everybody was reporting on different problems. Some would be having more of one problem than another. The second day was an action program, what can we do about this? People from all over the country. This was the first time I met some of them. I met Gene Schneider and I met Al Ricci at this thing; I don't think Jack Crosby went up to it. I met John Morrissy from Colorado and people from Wyoming whose names I'd never heard. I met Ray Schneider. People from all over the place.
Out of that was formed a Pole Line Attachment Committee. I became a member. I don't remember some of the action programs that we were doing as a result of that meeting. The prime concern of the operators was the restrictions that were being imposed on what they could do.
There are some places, too, where the phone company would not provide a contract. This was particularly true in the case of General Telephone. They were rough, old birds. I do remember that when Milt relinquished the chairmanship of the committee, I became chairman in June of 1961. It was August or September of that year that Bob L'Heureux and I made the first of many trips to New York, to AT&T headquarters. I remember the names of the people we met with there. One was Hubert Kertz who, I think, was an assistant vice-president for planning. Another was Stephen Fletcher. He was either an assistant or the general counsel to AT&T. We went up there with our shopping list of problems, and we were emphasizing restrictions. We presented our shopping list. We must have been with them for an hour and a half to two hours. They were very courteous to us. They said, "We'll see what we can do. You must understand that we don't control what these subsidiaries do." I kind of put my tongue in my cheek when I heard that. They could control them any way they wanted, I thought. They said, "We cannot control; we can only suggest policy." Not too long after that, we got a copy of a letter that had gone out from AT&T to the subsidiary Bell Companies, suggesting the removal of restrictions. That was a step in the right direction.
Problems continued to come around and the phone companies began to get active in what we called a lease back. They would build the system and lease it back to us. They called it channel transmission service. We called it lease back. In many instances the cable company would be required to put up a cash bond equivalent to the total amount of the cost of building the system. They, apparently, let that bond stay there and gradually amortize it out, so eventually you wouldn't have it and you would have paid for their plant. In addition, they had a bunch of charges. So much for tapping into a feeder line to hook up a customer, so much per customer per month, and so forth. This was in addition to the monthly quarter-mile charges for the plant. Their charges were ferociously high. If a cable company went along with them and paid all their monthly charges, all the cable company would own in the end would, essentially, be the city franchise.
DUDLEY: Quite a collection of worthless paper.
CONROY: A lot of worthless paper. He might own the drop line into the customer's home, and I'm not even sure of that.
DUDLEY: But, probably, not the right to connect it to anything.
CONROY: No. They were heavily restricted. In some of the later lease back proposals, the phone company reserved the right to appropriate a certain amount of spectrum space for their own purposes. They built the plant at our expense and then appropriated a certain amount of spectrum space for themselves, for whatever purposes. We (NCTA) talked heavily against this mode of operation, urging that it be avoided; we wanted to be the ones to own our systems and plants. It was legal for them to do it. Eventually, we beat it but, at the time, it was legal. They could do it and they were doing it. The people who were taking advantage of the situation were broadcasters who didn't know anything about the business. They thought this was an easy way to get in, particularly if they didn't have to put up that much cash bond. The per mileage charge of what they'd make to lease the systems for a month was just horrendous. It was a completely uneconomical way to operate and run a system.
A lot of phone companies used this method as a means of controlling entry into the business. As franchise fever was getting pretty hot from the late 1960s toward the 1970s, a given town would be considering a franchise and the phone company would say, "There are multiple applicants here. We are not going to make a choice among applicants. We will only give one pole-attachment contract. Of course, channel transmission service is always available for anybody who wants to do it." Where you have multiple applicants, you couldn't get a pole contract. One of the guys often would say, "Well, yeah I'll do that. I'll take it." The phone company was also making an argument, "You don't need a franchise. We have the franchise. Just the same as if we want to lease our lines to Musak. They don't need a franchise from the city, so you don't need a franchise. You can circumvent that completely." They were suggesting that they could control entry. I don't think the cities bought that too much. We felt we were at our wits' end in trying to combat this thing. I think the phone companies were making a grab at control of the industry. "So it goes over a wire, it's going to be a Bell wire." That's the word that was going around in those days.
I say Bell, but General was even harrier on this than Bell. Earlier on they said, "No poles. We won't give you an attachment contract. We won't do it." So General Telephone formed subsidiaries in their towns to build and operate the cable systems. Bell was precluded from doing it under the terms of a 1956 consent decree, whereby they could not operate a business that was not a regulated business. The same did not apply to General Telephone or any of the other independent telephone companies. General would refuse a pole contract. They would tell the city council, "No, we're not going to give you the pole contract, but we have a company formed. It's us and it's a subsidiary, and we'll grant an attachment contract to these people. And we'll run the system."
This activity, ultimately, was one factor that led to the anti-trust suit. Cable was a small part of that, but it was a factor. The Justice Department had sent interrogatives to any number of cable companies, just asking for facts. I'd seen copies and the replies--their discovery documents. There's a stack of papers, an inch and a half thick, of all of the complaints from various cable entities throughout the country, citing what Bell and others had done. You could go on and on with the parade of horribles.
Ultimately, it was decided at the FCC under Section 214 of the Communications Act, that no telephone company could build such a lease back system without going through the provisions of Section 214. You would have to get a permit from the Commission.
A man that was very active in winning this 214 case was Bruce Lovett. He was brought on board the NCTA in 1965 or 1966 as the Association's general counsel under Bob L'Heureux. His specific task was to organize our defenses to beat the phone companies on 214. He was a particularly good choice, I thought, because he had been an employee of Western Electric. He knew the ins and the outs of the phone company, and he was an attorney. Ultimately, he prevailed. The NCTA prevailed. Following that, the telephone companies had to get out of the lease back business, and were no longer promoting it. Now we're seeing them start to promote it again.
That didn't solve our problems with the poles. We had a dual problem here: 1) was to keep control of the industry; and 2) when you get your own system, try to have pole attachment contracts on reasonable terms.
We had a series of meetings with General Telephone. We never did meet with United, but we had lots of meetings with AT&T. We had various people on the negotiating committee. Jay Ricks, an attorney at Hogan and Hartson, was one of the finer ones. Just recently, Jay argued the thing in the Supreme Court and won. Strat Smith was always in there. We met several times and tried to negotiate a scheme for what pole rates ought to be. It went all over the lot as to how this could be done, but we eventually got back to the point with Bell. We said, "Somehow this has got to be based on cost. It can't be based on what you think your pole is worth. It's got to be based on cost."
While this had been going on, Southwestern Bell, as part of the Bell System, sought twice to increase our rates. They succeeded the first time; I was the last one to sign this three dollar contract. That was around 1961 or 1962. I got around the restrictions by writing letters saying, "I will not agree to these restrictions. I think that you are flirting with anti-trust." They came around again in 1968 or 1969. This was parallel with problems in other parts of the country. Then they wanted to raise rates per pole from three dollars to five dollars.
In each instance, I set up an organization in Southwestern Bell's region, following Milt Shapp's example. I organized a committee consisting of people from every Southwestern Bell state; Missouri, Kansas, Oklahoma, Texas, and Arkansas. Our main effort was to keep a united front, not cave in. This was particularly true the second time. Just don't let them pick us off one by one. Let's keep a united front. Ultimately, in the late 1960s when they were trying to go to five dollars, there was a case before the Commission relating to complaints on pole rates. Our committee had Strat intervene. We became interveners, and our complaint was made part of the main case. Other organizations throughout the country were doing the same thing. California, New England. We were trying to hold the line.
This final group that I was working with involved Strat Smith, Jay Ricks, and Frank Drendel. Frank had started off in the business with Continental Telephone in their cable end. Frank had a fountain of knowledge of telephone company economics and embedded debt and all of that. He could spout this stuff off. I wouldn't know what he was talking about, at first, until he explained what it meant. I said, "Well, that sounds like you can speak their language." We had other people, experts, who would come in. Cable construction people would talk about what it really cost to build a pole line. We wanted to get it down to a cost basis. I used some materials that Southwestern Bell had used to justify their costs, but I applied it to our situation.
I drew a diagram, in fact, I still have a replica of it here. Jay Ricks used to call it the Conroy Plan. I took poles all the way up to forty-five feet. A forty foot, thirty-five foot, thirty foot pole, a twenty-five foot pole was too small. We had studies made on how many cable companies, on an average, across the country were occupying poles of each height. We made a survey and extrapolated for the whole industry. We took a typical pole and figured that cable used one foot of the usable space. As we defined it, the usable space on a pole was that part of the space that was maintained above ground clearance. That had to be eighteen feet above the ground, from that point to the top gain of the pole. We couldn't use the top one foot of the pole. So there was a given amount of usable space. I think we figured that with a thirty-five foot pole, with six feet in the ground and eighteen feet clearance, we would end up with about eleven feet of usable space. We worked that out, starting from a forty-five foot pole. Of course, there, we might occupy one nineteenth of the usable space. On a forty-foot pole, we occupied one fifteenth of the usable space. So we brought it down, as part of a formula for all poles, using those kinds of numbers. Then we got into the average cost of installing poles around the country. We followed this reasoning and it came down to what an adequate formula might be. In a hearing before the Commission we presented this plan the basics of which, I think, were later adopted by the Commission.
End of Tape 4, Side A
CONROY: As I indicated before, the negotiations on pole problems, particularly with AT&T and General Telephone, seemed to be a continuous thing from the beginning of the '60s into the '70s. I'm looking at a memo now, February 22, 1971. I think it would be interesting to just note who were members of our negotiating committees. I was there; George Barco; a man by the name of Joe Brennan, who was a utility expert and whom NCTA retained as a consultant; Gary Christianson, who was then general counsel to the NCTA; Bud Hostetter--I think you've heard of him--who may have been chairman of the committee then, or was later, and then later chairman of NCTA; a fellow by the name of Bill Jackson, who was a construction man in cable television; Norm Penwell, who was the NCTA staff engineer; Jay Ricks; and Strat Smith. That's just an indication of some of the people who were involved in it, in those days.
I was talking about a formula a few minutes ago. We testified before an FCC hearing regarding our feeling on how pole rates should be judged and arrived at. Basically, it was a combination of the net book cost installed; (A) the annual cost of maintaining the poles; (B) and the percentage of usable space occupied by cable; and (C) so A x B x C = pole attachment rate. This is precisely what we used with the Commission.
I think we came down to a rate, at that time, using information given to us by the phone companies. We wanted to use their figures, just to show that we would come up with a lower rate. They were asking five to seven dollars and we came up with $2.44. (refers to memo) Apparently, I made some testimony and it says, "Number three, percentage of usable pole space occupied by CATV." It refers to Ben CONROY testimony, which suggests the figure of one-ninth (11 percent) as the portion of usable pole space occupied by cable attachment. Jay Ricks used to refer to this as the CONROY Plan, but it wasn't; it was stuff that I had distilled from mostly telephone company presentations and figures and I'd adapted it to our use.
The result was that on August 3, 1973, the Commission instructed the staff to draft the appropriate documents, asserting jurisdiction of pole lines. We really had come a long way to persuade the Commission that this was a problem that they should be thoroughly interested in. I've often thought back that probably we should have brought these matters to the attention of the Justice Department much earlier than we did. I think we would have gotten a resolution, maybe even sooner. And gotten Bell's attention that much sooner, too. Ultimately, this led to the enactment of the pole law. It became law, was later challenged, and Jay Ricks just recently successfully argued before the Supreme Court that the law be upheld. The net result of the Commission's taking jurisdiction was that the pole line rates around the country took quite a sharp downturn. By using the proper procedures someone could approach the Commission with a filing; he didn't have to make an appearance. For example, I think Southwestern's rates here in Texas went to $1.91. There were all these odd numbers. But we're seeing the Commission trying to raise the rates again. The Association spent a lot of time and money fighting this thing but the results were worth millions of dollars to cable companies in pole fees.
DUDLEY: If the formula still stands up, and there seems to be no reason why it shouldn't, then by taking the cost of the phone company on each one of those poles now, they should be able to justify an increase, and you should be able to argue against it.
CONROY: The Bell System has been using fewer and fewer poles and going underground. But it's not only the Bell System now; the power companies are also involved. We had some proceedings against the power companies. Of course, they denied that the FCC had any jurisdiction over them, but the FCC jurisdiction was upheld. This law holds for cable television uses of the poles. It doesn't say telephone companies or power companies. I'm just thinking that to the extent that a significant number of poles that were installed during a period of extreme inflation, possibly some increases could be justified, based on the increase in costs. Many poles are twenty-five or thirty years old. They don't wear out too quickly. They are treated and creosoted. Treated poles last pretty long in the ground unless some car knocks them down.
DUDLEY: What about a major city where most of the plant is underground, there is nothing then governing that. Is that correct?
CONROY: Even in major cities such as New York City--not in Manhattan, but say, in Brooklyn--there are poles all over the place. You raise a good point. I've neglected to mention that in dealing with AT&T, we also talked about conduits. They said, "We don't have any conduit space left. In the instance where we do have conduit space, we are going to have to charge you appropriately based on our cost." There is no question that underground conduits are expensive as hell. People who accepted conduit space, and I don't think many people did, are there under the right of ejection when the phone company needs that space for its own usage. When we built the Hartford system, we had to go underground for a certain amount of area. We didn't seek to use the phone company's conduits; we had to bear the cost of digging the streets up ourselves. We had to know where to dig so we wouldn't disrupt existing services. It's expensive as the deuce. In a heavily-built urban area, I think you could have the cost reaching as high as one hundred thousand dollars a mile. Those were the figures in Hartford. In most places there are still poles around in residential sections.
One thing that alleviated the situation to some degree was the development of AML microwave. We used that in Hartford, too. It was developed by Hughes and Hub Schlafly. That was a means of transmitting channels from a central point to different hubs and, in many cases, avoiding extensive use of either poles or underground. This was, primarily, a trunking system. In Hartford, I remember well, we were estimating one hundred thousand dollars a mile just for small stretches. Expensive as the deuce.
DUDLEY: Could you explain a bit more about AML microwaving?
CONROY: Okay. AML was a device developed by Hub Schlafly and Hughes, whereby groups of channels, six to sixteen, could be transmitted as a single transmission from one point to another. It was particularly adapted for cable television. You could have a central headend position, and from there transmit all of the channels to other hub points, which would be operating as a sub-headend. Then further distribution from those points by traditional cable means. As cable systems went into bigger and bigger cities, this became very important. It's an engineering consideration because there was a maximum cascading of amplifiers which was feasible, beyond which the pictures would deteriorate badly. You would just reproduce noise. What you wanted to do was cut down on the cascade, and one way to do that was to avoid the use of cable. Just go over the air to these hubs, and then distribute from there.
DUDLEY: That's multiple point-to-point from a central source. Is that correct?
CONROY: Yes, that's right.
DUDLEY: It is not broadcast?
CONROY: Oh, no, no. It uses microwave frequencies. It was not broadcast in any way. A typical homeowner could not pick this up. You need specialized receivers and antennas to receive it. It wasn't even CARS microwave, which is channel by channel. This was a whole broad spectrum. I'm not, by any means, an expert on that. I've had engineering training, but most of the time in cable I was involved in the management end. I had enough engineering behind me so that I could understand what the hell we were doing. I didn't feel that I could often be snowed by the engineers. I could be snowed more often by bankers than I could by engineers.
DUDLEY: A couple of things that are related to the present and future with the deregulation of cable. We've seen some changes in the cost of cable; we've seen changes in the definition of basic; we've seen changes in the placement of channels in the cable system. Your opinions on how those things are related and what might be coming in the future.
CONROY: Deregulation has come at a time when I'm not actively involved. I won't profess to being really active today. My knowledge is from reading the trade press. Deregulation can be a boon to cable companies. I'll take a couple of spheres first. First the economic rates, and so on, where owners don't have to go back to the cities for rate increases. However, I would think that cable companies should act with great forbearance on this issue. I saw one instance recently in which the company was in deep trouble with some city, maybe it was a TCI system out in the northwest. They immediately bumped rates from $12 to $16 a month. The customers are just up in the air about it.
I think that deregulation is fine, but you have to use common sense and you've got to put yourself in the subscribers' place and just not hit them over the head. You have to be very careful in that area. As to mixing in must-carry and basic, must-carry is a real problem in areas that have a lot of television stations. As an example, the Bay Area in California. There must be twenty-two or twenty-four channels in that San Francisco area which are receivable off-the-air by the normal rooftop antenna. Not all of them, but a good many of them. The problem is that there is some duplication so the cable company, which put in a thirty-six channel system, has to devote twenty-four of those just to carry off-the-air channels. That creates a problem. Deregulation allows them to remove some of those channels from their lineup, providing a little easing of the burden. By the same token, to the extent that more and more people get their television by cable, this creates a problem for the stations. Often, a UHF station can only be seen through the facilities of a cable company.
I don't know if I have a solution for that problem. It's a tremendous amount of channels on systems that have to be devoted to just an off-the-air situation. It's far different from a city like Austin. Right here we have three networks, one independent, and a public television channel. That's five. That's not bad; it is certainly different than twenty-five.
DUDLEY: So some communities really force a cable system to be a "community antenna."
CONROY: That's right. Of course, in San Francisco I don't know what the system has and uses in the way of channel capacity and activated channels. I'd think it would have to have fifty or sixty just to accommodate the things that they want in addition to broadcast channels. Unfortunately, the channels that are first selected for bumping may be two or three public television stations, which certainly may duplicate each other's programs. Certainly, if they have three NBCs around, there is duplication, but how is that helpful? It's helpful to the station to be on, but only to the extent that they are just on the network feed from morning to night. I can't see how that helps a viewer; it does help the station.
So deregulation and must-carry. Well, must-carry probably isn't a problem here in Austin. In San Francisco, it's an extreme problem. It has always been an extreme problem there.
DUDLEY: What about cable systems carry stations on a cable channel other than their broadcast channel?
CONROY: I guess I can talk from a depth of ignorance there. I can appreciate that a station would like to be carried on its signature channel. That was not possible before the days of converters. If you carried Channel 2 on Channel 2, you would be creating interference on your own cable system because the time in which the signal reaches the home TV set is quicker over the air by a few micro-seconds than it is over cable. That time delay would cause an extreme ghosting situation. However, with the converter, where everything is carried on the converter and on the set's Channel 3, you can carry a Channel 2 on 2 and 3 on 3 and so on. Now you have UHF stations. I would presume that they would either like to be on their signature channels or, I'm not sure about this, but maybe they would like to be up on the top of the dial and not where they often are found around Channel 38 or someplace.
As I said before, I haven't had any experience in having to cope with this, so I don't know that my opinion is worth very much, except that I think this is an area where cable systems should tread very carefully. If I were an operator in that position and I wanted to change channels around and change services in and out of basic, I think I would talk to the broadcaster first. Just don't do it out of a clear blue sky. I think I would survey customers because some systems have been dropping services completely or dropping some from basic and placing them on a more costly tier, with little notice. I think I would take the trouble to survey my customers. Then I could at least say to the City Council that these are customer preferences. The majority voted for this or voted for that, and we want to do it because it provides this kind of a benefit to our operation and to our customers, rather than just jumping in and saying, "Well, okay folks. We are the only cable company in town, and here is what we are going to do today."
DUDLEY: This is the end of day one, May 22, 1987, interview with Ben CONROY, Oral History for The National Museum of Cable Television.
DUDLEY: This is May 23, 1987, continuation of the interview with Ben Conroy.
Would you tell us about some of the people whom you have been associated with in the cable business over the years. Also, comment about the camaraderie among the cable people in the early days. It's obvious that that's evident.
CONROY: I think I'll talk first about people with whom I have been associated with, on a company basis, and then move on to Association people. I've mentioned several already.
I've mentioned Bill Arnold. I first met Bill when I was still in Uvalde, 1966. I think it was the spring of that year. The Genco organization was in the formation process, and in fact, was finally formed up in the middle of that summer. Bill's background, up to that time, had been mostly in accounting. He was a numbers man. Bob Hughes, who was then at Texas Capital (on SBIC) had known Bill. Bill was a distributor for Gulf Toys. He would go around to convenience-type stores and set up the toy racks. He would travel around quite a bit. He was taken on in Genco when we were establishing headquarters in Austin. Bill lived in Austin. Jack and I were still out in west Texas at that time. Bill was going to be primarily our numbers man.
I remember the first meeting with Bill. He came into my office in Uvalde and I started to ask him a few questions. He talked on and on and on and answered only one of them. I thought, "My God, will this man never stop talking?" We've kidded often over the years about that first meeting. Bill always has three or four ways you can do something. He'll embark down one line, than say, "Another way you can do this is ...," and he would be off in another direction. We quickly became close friends, and our families, too. I don't know anyone who doesn't like Bill. He's a big, teddy-bear of a man. You know he's from Texas with his loud, deep voice. He's a big man in height and weight.
We were together all the time until I parted ways with the Times-Mirror group in 1979. We traveled a lot together into the systems. Bill was and is a hard, hard worker. He works hard and he plays hard. When we were in the Genco group, he would spend two or three weeks at a time out in Casper, Wyoming, just spending time with the office people. Not only Casper, but in the other systems, too. He quickly got to know all of the personnel much better than I. I wouldn't spend much time in any one place. He's a wonderful man and we had a good personal relationship. He's been traveling to St. Louis with me to hear the Ragtime Festival music every June since 1970. There was a convention in Chicago and we went from Chicago down to St. Louis where the Ragtime Festival was. I grew a beard in 1975 and two or three years later, Bill comes along with a beard. Other beards started to sprout out in CPI.
Editor's Note: The following insert was recorded following this interview. The audio is on the addendum cassette.
This segment might well be in the Bill Arnold section. It relates to the Mesa Petroleum/Boone Pickens thing. In 1970 or 1971, word reached CPI that the 50 percent part of the Texarkana franchise, owned by Mesa Petroleum, was for sale. Texarkana is in both Texas and Arkansas in the northeast part of Texas and southwest part of Arkansas. Bill Arnold and I went to Amarillo to negotiate terms with Mesa Petroleum and spent the afternoon with Boone Pickens. I had never heard of him before. He had a very large office and we sat at one end of it around a table and Boone, with his legal pad and no one else, regaled us for a while with stories of the oil business and his early-morning running program. Eventually, we struck a deal for acquiring his part of the franchise. He was a man of his word on this deal and we did, indeed, take it over. This was, however, before the 1972 rules came into effect. We kept hoping that there would be some breakthrough. We could have built it, but we had problems in doing so and we couldn't bring in distant signals.
Texarkana was a hyphenated market of Shreveport-Texarkana. In the beginning, the Shreveport and Texarkana stations were all in Shreveport, which is the larger city. Ultimately, the FCC required that the station that was designated as Texarkana had to either move its transmitter or put a satellite operation in Texarkana and start paying some attention to Texarkana affairs. Generally, the three stations were oriented to Shreveport. Texarkana citizens felt they had no coverage and were anxious to get a cable system. They wanted to get both Texas and Arkansas stations. We were proposing to bring in Dallas and Little Rock. The newspaper in Texarkana was owned by a man named Walter Hussman, a shareholder of Midwest Video, a cable MSO which George Morrell operated. As time went on, we were not building the system because of FCC restrictions and Hussman was pushing Morrell to have the joint city councils give franchise rights to Midwest Video because of our non-performance. At this particular time, Bill Arnold and I were together up there with a man named Floyd Shelton, who was CPI's franchising VP.
I remember a presentation by George Shapiro, a Washington attorney from the firm Arent Fox and Kintner. He made a big deal about there not being anything to prevent CPI from building and that we could build a cable system any time. We had a local attorney there but he was not too up on cable things, particularly Washington rules, so I spoke for our group. My responses related to what we could offer under the rules. Also, in responding directly to George Shapiro, who said there was nothing to keep us from building, I said that was why I didn't take business advice from attorneys. That kind of got a big laugh and the meeting broke up on a light tone. We retained the franchise and, eventually, built Texarkana. It became a very good system for CPI. To this day, I am friendly with George Shapiro who, ultimately, was nominated to membership in the Cable TV Pioneers.
End of Insert
Another fellow was Jim Stilwell. Jim is a marvelous engineer. Jim has been in the business longer than I have. He was with Jerrold back in the early 1950s, and before that he was with Philco. When I first met Jim, he was with Jerrold Southwest, in the Dallas office. He had taken over from Herm Roeder, whom I've mentioned before. I think Herm resigned from Jerrold and went out to California. I haven't seen Herm since the 1950s. Jim is a consummate engineer. He will tell you more than you want to know about any one subject, particularly in engineering. It's often been said of Jim, as it has of other people, you ask Jim the time of day and he'll tell you how to build a watch and how to repair it. Since he left Jerrold, he had been associated with Fred Lieberman just about all of the time, until he retired. Jim is a practical engineer, full of ideas. How you can do this and do that for different cable operations. He understands all facets of the business and he's very imaginative. I always have enjoyed being with Jim and, again, it's a family relationship. We know his boys and we knew his wife. He's been here and I've been up at his place. We just fell in very easily together.
Along those same lines is Al Bloom, also in the Philadelphia area. I should say that Jim's home was in the Philadelphia area. Al came with Fred Lieberman in the late '50s. He managed Fred's early systems until they were purchased by Cox. This goes back to the late 1960s. Then Fred started to form another group of systems. Al stayed with the Cox group until he'd played out his time, and then came back with Fred. It was about the time that we and Fred were exchanging management for our systems. As I told you, he for the Jersey systems, and we for his Midland, Texas system. That's really when I met Al Bloom. Al came out to Midland to take a look at that operation. It's funny, your first impressions of people are not always your lasting impressions. My first impression of Al was, "Here's this guy from the east who seems to be a little bit abrasive to me." We would be talking down one line and Al always used to say, "Well, let me make a suggestion." Then we would go on down some other line. That first impression didn't last long.
Al was another hard worker, and he minded Fred's nickels very, very closely. The Indian was on top of the buffalo by the time that Al would let go of that nickel. He was a very good manager and a very good people person, just as Bill Arnold is. He's worked wonderfully with people, and the people love him. Al was general manager of Fred's properties. When we came into the picture, he managed the properties that were immediately surrounding Philadelphia, including the Jersey properties, and Williamsport, and the franchises we were building around Philadelphia. Again, it's one of these things where we are family friends. He's been here, I've been there. We're still friendly. In fact, it's a funny thing, this coming summer, September of 1987, at Claude Stevanus' suggestion, we will have sort of a "board meeting" of some of the people from CPI that used to meet periodically on company matters. They used to come down to Austin each quarter and we would go over budgets, problems, plans, and promotions. That group was Bill Arnold, Claude Stevanus, Paul Snyder, Al Bloom, and Jim Stilwell. We're all going to get together. I blindfolded myself and put my finger on a map and just happened to come out on St. Louis. We're just going to get together and I'll have to draw up an agenda for that meeting.
Editor's Note: The following insert was recorded following this interview. The audio is on the addendum cassette.
I first met Fred Lieberman in the months previous to the Uvalde system's opening, 1955. At that time, Fred was a Jerrold employee and had taken over the operation from Lee Green of Jerrold Southwest. I might add, too, that Fred started off with Jerrold, Ohio, based in Pittsburgh. I know that he had something to do with starting Claude Stevanus up and helping him get his system going. George Barco tells a story that Fred was an engineer/salesman but he was such a good salesman that he started to make more in commissions than the headquarters people in Philadelphia, so they carved up his territory. He was making too much money. At any rate, he ultimately took over down in Dallas for Jerrold. Jim Stilwell was the field engineer in that office. I had met Fred a few times, had been up to Dallas to see him, and he came down to Uvalde for our opening. He bought a western hat and took a piece of this K-14 cable, which was an inch and a quarter or so thick and about fifteen inches long and was used for our run-to-town trunk line. He started marching up and down the middle of one of the main streets with this regalia. This fierce-looking, Philadelphia-type character with a cigar in his mouth. I finally said, "Fred, for God's sake, I've got to get this business going in this town. I don't know what kind of impression you think you're making out there." Well, we did have the opening, and that was my real introduction to Fred Lieberman.
He was also helping Jack Crosby get his system going over in Del Rio. He and Jack eventually partnered up, once Fred left Jerrold later that year or early 1956. He started buying systems. His first system was, I think, either Montpelier or Burlington, Vermont. Jack Crosby tells a story about later on in their association. Fred and Jack were going to a meeting with some bankers and Fred had the usual cigar in his mouth. The banker's office they were going into had clear glass around it and, apparently, you couldn't see the glass. Fred didn't know there was glass and walked right up against the door. He mashed the cigar against the glass but it didn't even seem to faze him. He just pushed the door open and put his cigar in the waste basket and started doing business.
End of Insert
I've mentioned Claude Stevanus. He was the founder of the group of systems that joined with us in Ohio. They were originally called Tower Antennas. That name came from the fact that Claude built a system in a little town of Sugarcreek, Ohio, which is near New Philadelphia. There can't be more than one thousand people there. Claude lives on a bit of a hill and he put up a tower with some antennas on top of it and was running his cable around town. People would say that they were hooked up to the tower antennas. He adopted that as a name for his company. I'm not sure when he got going, I think it was round 1953. He gradually built systems. One was in Coshocton, which wasn't far from Sugarcreek; he used to headquarter in Coshocton. He either built or bought New Philadelphia and Dover, Ohio, which were adjoining towns. He built systems in other towns such as Ironton and Weirton, West Virginia. Weirton is up in the panhandle of West Virginia. And quite a few other systems in that area. Claude ran a very, very close and tight operation. In the early days he had one of IBM's 1401 card system computers for billing purposes. I always enjoyed going up to his place, and he's been here. His wife Mary, unfortunately, died a few years ago. Claude is now retired; he's a little older than I am. A very, very fine, good man, and a good cable operator.
His second-in-charge was Paul Snyder. I'm not sure of Paul's background, but I know that he was Claude's right arm. Going out into the systems, taking care of managing problems, and Paul fell right into the organization. Our mistake with Paul was putting him in the New England region. Paul's a hard worker and he did good work for us, but New England just wasn't a good situation for him and his family. Living in East Hartford, as opposed to living in Coshocton, is a bit of a culture shock. I think he took about as much of it as he could and then he wrote me. He said it was a very difficult letter, but he was going to have to resign. After that time--I think this happened in the mid '70s--Paul never did get back into the business, but established himself in Bluffton, Ohio, where he's built a string of retail stores, ladies ready-to-wear, children's clothing, and so forth. I keep in touch with Claude and Paul, always a Christmas call every year. He's going to join us in this little get together.
Tom Soulsby is another fellow who has been around with us a long time. Tom came to our attention through Glen Scallorn, whom I'll mention in a moment. Tom was working with a cable group headquartered in Fort Worth, I think. He was managing a system north of here. I think Tom came from AM radio. We interviewed him and hired him to manage the new system we were building in Midland.
Tom's a very aggressive, young fellow who is very loyal and very hard working. Tom's problem was that he worked too fast. You would give him a job to do and he would finish it so fast that he'd be sitting around and you'd wonder why the hell isn't he working. He'd already done what you told him to do, and was looking around for something else. He was very quick. He did a very good job in Midland, but was in a very tough situation out there.
We had two local people who were largely responsible for our getting the franchise. They had 20 percent interest in the company we established: Tall City TV Cable. Tall City comes from a nickname for Midland; they call it the land of the Big Sky and Tall City. Buildings rise up to meet the sky out in the dusty plains. These two people tended to be all over Tom's ass up there, constantly. Sometimes we had to act as a buffer. Tom got abrasive with them a few times. We got to the point where we, gradually, saw fit to move Tom into Austin headquarters, which is what he wanted all along. They suggested one of their men to put in Tom's place. I won't even tell you his name, but from our point of view he turned out to be unsatisfactory. He was always their man and was not following our directions the way we liked. Ultimately, we were able to get his ass out of that system.
Tom was a super fellow and was good with us. He originally was called a "gofer." Tom was doing all the "go for" this and "go for" that. We eventually put him on the trail of helping us get franchises, doing odds and ends of work for me, for Bill Arnold, or for anyone who needed something to be done.
I never will forget his first trip with me to see some of the systems and get acquainted with the people, the systems, and the procedures. He had not traveled much. Tom was still living in Midland and I was in Austin and we were to meet at the Dallas airport. So I said, "Tom, we've got you booked on flight so and so, going to Ohio. Be at the gate at such and such a time, and I'll meet you there and we'll go." Well, I was at the gate and plane time was coming and no Tom. Just before they were about to close the gate, up comes Soulsby with a porter carrying about three bags. He was running and puffing. When we got to the plane, I said, "What in the hell are you doing with all that goddamn baggage?" He said, "Well, I was trying to get it checked and it was taking so much time." I said, "Soulsby, after this when you travel with me, you will not check baggage. You're going to carry one bag and a suit bag and that's it. I'm not going to have any of this crap about waiting around for you and then your bags." After that he traveled pretty light. He's a good man.
I've mentioned Glenn Scallorn before. Glenn started working for Jack Crosby around 1959 or 1960. At that time Glen was trying to scrape along in the insurance business but his real background was coaching. Glenn is a real athlete and has coached different high school teams. He's a great golfer. In fact, he's probably good at any sport. Jack needed a manager for his system in Del Rio because his attention was being devoted to a number of other things. I met him first in Austin. I think Jack and I were at a meeting in Austin with Johnny Mankin. I'll mention the subject of this meeting later because it involved our Texas Association and the Texas Association of Broadcasters. Glenn met us there and I think Jack wanted me to look him over or, possibly, just to meet him. Anyway, Glenn makes an immediate, good first impression. He's a real Texan, kind of slow-talking and slow to anger but he can get angry. He used to always puff on a cigar but not anymore. Glenn was a hunter, too.
Jack's family has a ranch outside Del Rio, and every year there would be a deer hunt and Glenn would take Jack's guests around, and would spot them the deer, and even shoot the deer if he had to. He said what's worse is he even had to clean the damn deer, most of the time. I don't think he likes to hunt too much anymore. Glenn became very active in the Texas Association and, eventually, became its president. He's been a member of the NCTA Board and, I think, served as NCTA treasurer, too. Glenn's another wonderful fellow. He still manages the system in Del Rio. When Faber Spires retired a couple of years ago from managing the Uvalde system, Times-Mirror gave Uvalde to Glenn to manage. He manages both of those systems and travels to Uvalde a couple of days a week.
Glenn is also an entrepreneur in his own right. He was one of the investors in the system that I mentioned before, the Southern group of systems, Eastland, Cisco and Ranger, little systems up in west Texas. He had a strong interest in a system down in Palacios, Texas, down on the Texas coast between Houston and Corpus Christi. I think he has sold that. I think he also had an interest in Fred Lieberman's group of systems in Switzerland. That's the first I've mentioned of that. Glenn is still going strong.
Johnny Mankin. There was an original. Johnny died of cancer a couple of years ago. He was one of the most beloved people in Texas. He was known well beyond our borders. I first met John when we were forming the Texas Association back in 1959. John worked full-time as a manager for Glenn Flinn and his system in Tyler which, at that time, was the biggest in Texas. One of the biggest in the country. They also had a smaller system south of Tyler in Jacksonville. He tells that he used to work in Del Rio, Texas, in the 1940s as a manager for a Woolworths store down there. I don't know what led him to Tyler but he ended up as manager there. John was another real good people man. He was good with his employees and his customers. He was super with his customers.
Editor's Note: The following insert was recorded following this interview. The audio is on the addendum cassette.
CONROY: This would be in personalities. Fred Ford. It was my pleasure to know and work with Fred Ford, particularly in my chairman year, but thereafter as well. Fred made quite a mark in a speech that he made, I think, in Denver in 1965. Up to that time, whether or not cable television should engage in local origination had been batted around like a tennis ball. Fred came out with a speech in Denver, which heavily advocated cable's doing this as a means of local expression. It made quite a splash in cable, FCC, and broadcast circles.
One of my happiest and most vivid recollections of Fred is a time when we were together on a trip out to Seattle. I'm not sure of the purpose of it, probably it was a joint appearance before the Pacific Northwest Association. One evening I found out that my friend Bob Darch, the piano player I had met in Denver during the 1965 convention, was playing in town. I prevailed upon Fred to go with me to listen to Darch and I had my tape recorder. Fred was enjoying the proceedings and the piano playing. We each had a few drinks and Fred started to reminisce about West Virginia and some of the songs that used to be sung down there. He got to singing one and I have a tape of it. It's something about, "Mule, mule ...," and he was going on about it. I'll have to listen to it again to get the full context of the words but I remember that occasion.
We followed up that trip to Seattle with one to the Los Angeles area. There were a couple of brothers called the Tanners. They had some kind of scheme that they had written to NCTA about whereby cable could get its signal in place without using cable. They would seek permission to activate gas pipes with some kind of mantle of electricity by induction and along these pipes we could carry the RF signal for cable. Well, it seemed a little bit farfetched, but we met with them and, of course, it never did happen. I remember that Fred, as an afterthought, said, "We ought to go down and see if there is anything to this at all." As I said, nothing ever came of it. I ran across the Tanner boys a few years later and they were on to some other scheme.
One of the most distressing times that I recall in my association with Fred was in March of 1966. We were having an NCTA board meeting in Washington. At that time there was a bill before the House Interstate Commerce Sub-Committee on Communications to put cable under the jurisdiction of the FCC under terms that must have been unfavorable to us because we were fighting it. Fred had appeared many times in the course of his FCC career before Congressional committees, particularly when he was chairman. The style of the FCC is generally to have a single spokesman make a single statement. That was usually pretty long and the chairman would read it, submit it, respond to some questions, then leave, and that would be that. Fred had prepared one of these for review by the Board and was proposing to be the sole spokesman for the industry.
As he went through this, I began to get restless and members of the Board were restless. We just did not see that Fred's statement was going to be responsive to what we felt were the real problems that we had with this bill and the effect that it would have on local operators. I called the meeting into executive session, excused visitors, and had to look at Fred and say, "Fred, I'm afraid this is just not satisfactory." We went from there to devise a plan that ended up to be a massive outpouring of letters from subscribers and cable operators as well as appearances by cable operators before the committee, and so forth. The bill did not pass, but I remember how distressed I was, at the time, to tell the immediate past chairman of the FCC that this particular piece of work was not satisfactory. I felt I had reached some kind of a low point and I'm sure Fred was distressed also.
During that same year, 1965-1966, which seemed to be a year full of crises, we had a meeting in January of our Executive Committee. Washington was inundated with what must have been two feet of snow. The night before, Frank Thompson and I had been over to Bob L'Heureux's house in Virginia and somehow had gotten back. Bob had driven us back through the snow. I remember over at Bob's house doing some considerable shoveling to get out. The next morning we were waiting to get a quorum, because people were still trying to get into Washington. We finally got the meeting going. For some reason, that morning or that afternoon, Frank Thompson was feeling a little cantankerous and kept interrupting, and I was getting short-tempered. I remember picking up an ashtray and throwing it at him and saying, "Thompson, God damn it, shut up!" Fortunately, it didn't hit him. It was one of these little incidents that sticks in your mind. We stayed friends, however, and I haven't thrown any more ashtrays at Frank or anybody else, for that matter, in recent years.
End of Insert
End of Tape 4, Side B
CONROY: John had an endless series of stories and jokes that usually had us rolling around and laughing. One of the earliest of his routines that I recall is the family he called the Prycke Boys. This is pronounced is if it were spelled Prycke. But John would say, "Did you ever hear about my friends the Prycke Boys? Limber Prycke, P-R-I-C-K." And then he says, "His brother, Byg Prycke." All these "i"s were pronounced as "y"s. So Byg would be B-Y-G and Lyttle and Dyrty. I can recall at some convention meetings he would have the hotel operator page him and some of his Pryck Boys. As soon as we heard that, we knew that Johnny Mankin was on the premises.
John was our secretary-treasurer all the time in the Texas Association. Board of Directors came and went but Johnny was the mainstay. He put on all of the conventions and shows, with help, of course. As Bill Arnold became involved in cable and got away from the numbers and more into operation, he used to assist Johnny. Ultimately, when Bill Arnold left Times-Mirror and took over as the professional executive director of the Texas Cable Association he had a wonderful background with Johnny in that. Johnny stayed on as the manager of the Tyler system until his retirement, but still kept active with the Association. It was funny to have been friendly with him in the beginning working just on Association matters, and eventually to have become his boss and employer in the Genco group. When we parted the ways with Livingston Oil, Gene Schneider was his employer and remained so up until his retirement. Even after he retired from the active cable business, he was kept on as the executive secretary. When Bill Arnold took over, John was kept on as executive secretary emeritus. None of us felt that, from what John had told us, the condition of his final retirement and his treatment under some of his previous employers had been exactly equitable. So to assist in his retirement, the Association paid him a bit of a retainer.
It was Bill Arnold who refreshed my memory last night about the origin of the Johnny Mankin award. He tells me I had something to do with that. That shows you what a great memory I have. Jay O'Neil and I got together and thought we would honor John with an award. It came out as the Johnny Mankin award and somehow that became "the" Texas award, and still is. Apparently, that's the way it started.
I just mentioned Jay O'Neil. I've never been associated in business with Jay, except by being in the same business. We were never in the same company. Jay is another very fine, young operator. He's a former all-American quarterback going back to when he played for Bud Wilkinson up in Oklahoma. Jay's uncle was Walter Jenkins, here in Austin, who used to be one of the administrative assistants to Lyndon Johnson. Walter had formed several businesses and Jay operated a couple of them. One was CommCo, which was a cable construction business; the other business was CommCo operating systems. Jay was responsible for those as well. He left Austin and lives in New Mexico now. Jay has always been a very fine operator and a very fine fellow.
I'm glad I thought about Walter Jenkins. Walter had a sad and traumatic experience in Washington. I got to know him shortly after moving here to Austin because he was in the business. I think Toni and I met him and his wife Marge, possibly, through Jack Crosby. We got quite friendly and went to his daughter's wedding. Walter was a marvelously warm human being. I didn't see too much of him. He got into a lot of businesses, including the travel business, and was in and out of the cable business. Unfortunately, he died just recently. Walter was well known and respected in all the circles down here. He had a nice family.
I'll move now to some comments on other people whom I have known and come into contact with in the industry, generally. I first really got to know people outside Texas at the pole line attachment meeting in Chicago, 1959. Once I got on the board of directors, some of those same people were on also. Such as Gene Schneider and Al Ricci. Al was from Keene, New Hampshire, at that time. Al had a very interesting background. Al was in the Army during World War II. He was taken prisoner and was in a prisoner of war camp in Germany for a good while. Al is an enterprising fellow. He's not tall in height but he's tall in being a human being. I think his prison camp experience was later written up in Reader's Digest. Al busied himself by doing the guys' laundry. He had set up a laundry business in the prison camp. Of course, nobody had any money there so they would pay him with IOUs. It was anything from packs of cigarettes to pieces of toilet paper or anything else that an IOU could be written on. They each wrote the name of their hometown bank on it, the amount and their name. When Al was finally released, he had a whole satchel full of these slips. He mailed them to all of the banks and, according to Al, every one of those things were honored. With that, he set himself up in the music business in his hometown of Keene in The Melody Shop. He sold records and that kind of thing shortly after the war. I think it was operated by Al and his wife, Ruth.
Well, along came cable and Al, being an enterprising type of fellow, put in a system in Keene in 1955. As Al tells me, apparently Spencer Kennedy Labs (SKL) had a prototype, 12-channel tube amplifier. Al's was one of the first systems to use this equipment. Of course, he didn't have that many signals to put on, at that time. Al later sold the Keene system and then built some systems that he called the Pioneer Valley Systems in Massachusetts. Later Fred Lieberman bought them, and we acquired them when Fred joined us. Al was building systems in other places: Bennington, Vermont and Beacon, New York. Oh, he had a hell-of-a-time with the New York Telephone Company. If he could operate at all, it was with great difficulty. He actually may not have been able to get into business there. I remember he talked about a man in the phone company who was a stumbling block for him all the way. The man's name was Relyea, R-E-L-Y-E-A, I think. Al was always kind of rabid about Relyea. I really got to know Al and Gene Schneider from Casper, by my service on the Board. Gene, Al, Jack Crosby, and I used to be quite chummy. We'd sit and have drinks after a Board meeting. Not only us, but others. We just fell in together.
You mentioned camaraderie before. I don't know if there is any more or less of it in NCTA Board circles now. I haven't served on it recently. I know we felt we had it then, although it wasn't defined as such. One thing that drew us together was that we were all individual entrepreneurs. Most of us on the Board didn't work for anyone else but ourselves. We all were having common problems. We paid our own way up and back to the meetings. We tried to solve some of our industry problems and we became a closely-knit group.
Others came into this, Bill Adler and Sandford Randolph. Sandford went off the Board when I came on so I didn't see as much of him then as I did in my early years in cable. Ray Schneider was there.
We had a feeling that we were a closely-knit group. I can remember I inadvertently said something in my acceptance speech as chairman of the Denver convention in 1965: something about how much I enjoyed and appreciated being an NCTA board member and having been elected as their chairman because I felt that we were a band of brothers drawn together by this wonderful industry. Bill Adler of Weston, West Virginia picked up on that and he wanted to design a ring for the Cable Pioneers, which was formed the next year. He picked up on that remark. He said, "This band of brothers should have a ring to denote this brotherhood," but it never happened. I think we just felt that we were drawn together by a common crusade.
One of the best features of the NCTA board was the little informal sessions we'd have after the day's meetings were over. We would invariably retire to the bar and sit around, ourselves and members of the staff, Strat Smith, Bob L'Heureux, Wally Briscoe, and all the crowd, until it was time for supper. Usually, this was about 8:00 or 9:00 in the evening. So we got to know each other, not only on a professional Board member basis, but during the after-hour sessions, sitting and talking. It was there that we really found out about each others' businesses. How this one or that one had solved this or that problem. What promotion worked and what piece of equipment was better than another piece. We really got along very well because, among other things, we weren't in competition with each other. Those were before the days of the frantic search for franchises. Maybe the same conditions among the same people wouldn't exist today. I think we had it pretty good in that regard.
I mentioned Bill Adler. Bill's a West Virginia operator, retired now. He built several systems, the main headquarters system being Weston, West Virginia. His wife's name is Dolores. I think Bill's educational background is Princeton, and I think his background, before getting into cable, was retail women's dress stores. You'll note that all of the people that I have talked about, particularly in connection with NCTA, have a great variety of backgrounds, which is kind of remarkable. Bill has a wild sense of humor and is a real Woody Allen fan.
Bill and I were the cause of a hoax that is still talked about today and was in connection with the Cable TV Pioneers. I think it was the second or third year of the Pioneers, in preparation for the dinner in Boston in 1968. Around January of that year, I sent out a list of current Pioneers so that they would know who was a member and who, therefore, they could suggest for additional membership. Just for the hell of it and for no good reason at all, I included the name George Spelvin and put him in alphabetical order. I had known the name Spelvin as a mythical character in the theater circles. If there was a stand-in for somebody, he was often called George Spelvin, but George Spelvin never existed. He was a stand-in character who waited in the wings in case the lead failed to appear. I included him on the list of existing Pioneers. Well, Bill Adler picked up on this. He wrote a letter and addressed it to all the Pioneers and circulated it to all of them. There weren't that many of us at that time, probably forty or so. He ripped Spelvin up and down. He said, "If I had known that George Spelvin was a member of this organization, I would not have consented to join." He listed all the sins that George had committed. That he had, among other things, accepted a telephone lease back. He was permitting illegal tap-offs. Every known sin of the industry, this fellow Spelvin was doing. Furthermore, he ought to be expelled from the Pioneers, or Bill would get out of the Pioneers. Well, I got this, and I began to get letters from other people who took it pretty straight and were asking, "Who is this guy Spelvin? I don't remember his being in the Pioneers." I've got the file on this and, Lord, everybody wrote a letter, just about. I don't think George Barco was taken in or Frank Thompson.
Then I called Bill and said, "This looks interesting. I'm going to send out a letter outlining this year's business for getting new members, but including in it a question as to whether or not Spelvin, based on your indictment, should be expelled from the organization." So my letter went out. I began to get a pile of letters in from the members. Fred Stevenson never could get any mail, but Spelvin excited a whole bunch of members. I remember Archer Taylor writing and saying, "Don't let this organization degenerate into something like this. It's a social group, and we all do things that we are ashamed of sometimes." I got a lot of letters like this. Strat Smith wrote. It was just very funny. We ended up making up a letterhead and called it SpelCo Enterprises or something like that. On the bottom we put the business he was in, spurious emissions, TV translators, everything that cable people hated. Bill had secured a P.O. box in Reno, Ohio, a little town, possibly near Marietta. He had a friend in the cable business up there and he prevailed on this fellow to go by every few days and pick up those letters and mail them to Bill.
Then Bill sent me some letterheads which I used for Spelvin in correspondence. We then proceeded to send these very curious letters to a number of people in the industry. For instance, I remember writing Fred Lieberman but I didn't send the first page, I just sent the second page. Something to the effect, "... and if you cannot resolve this to my complete satisfaction, I can assure you that I am going to have my attorney in your damned Pennsylvania forthwith. Yours sincerely, George Spelvin."
A letter was sent to the NCTA, to Fred Ford, from Spelvin claiming that he had been maligned, that he had been in the cable business since 1944 and who were these fellows Tarlton and Walson to claim that they were in before him. Well, they took it pretty straight. Apparently, Fred Ford had the staff go through the files to try to find who this fellow Spelvin was. This just went on and on.
I remember writing a letter as George Spelvin to Tubby Flynn saying, "It will be good to see you again in Boston. Didn't we have a wild time down at the meeting in Greenbrier, West Virginia? When I get up there, I'll pay you back the $20 I owe you." So Tubby called me and said, "Do you know this fellow Spelvin?" I said, "Yeah, I remember him. He created quite an uproar at Greenbrier." He said, "He claims he owes me $20." I said, "Well, hell Tubby, he owes me $50, so I hope you collect it." This just went on and on.
The National Museum of Cable Television now has what is called the Spelvin Papers. This Spelvin business all culminated at our Pioneers dinner. We had let it be known that we were going to toss him out of the organization. I remember one letter that Bill Adler wrote as George Spelvin, he had adopted the name of his wife as Lottie Mae. He said that they were going to be at the convention and that Lottie Mae and their daughter, whatever name Bill had given her, were going to sponsor baton twirling lessons for cable operators with special rates to Pioneers.
Even Al Ricci was taken in on this. To this day Al will not talk to me about Spelvin. I think Al was angry that he wasn't in on the deal. Holland Rannells of Cumberland, Maryland, was very upset. We got in the elevator and he said, "I wish we wouldn't go through this terrible thing tonight. We shouldn't throw anybody out." Well, we got to the dinner. It was a dinner in which we had invited Bob L'Heureux and made him an honorary Pioneer. We knew that Bob was terminally ill. Bob's wife, Marguerite, came in late to the dinner, deliberately, dressed in all kinds of veils and was introduced as Lottie Mae Spelvin. Of course, Marguerite proceeded to do the dance of the seven veils and off came a lot of the things that she was wearing. Well, gradually it became pretty apparent that this whole thing had been a hoax. Some of them just looked kind of angry, and the others just started to laugh and laugh and laugh.
I kept up a little bit of it after that. I would get letters from people trying to sell movies, and I would use the Spelvin letterhead and pass the guy off this way, just write some nonsense. It did die down. Even the trade publications of those days were taken in. There used to be a fellow named Bob Huston who had Cable News. Spelvin wrote to him and told him he wanted to subscribe on behalf of all his systems, thirty or forty systems; he wanted to put a copy of the magazine in each system, and would Bob send him information on how to do this. Huston used to reprint every letter that he got and had this letter in there with a comment under it that said, "Glad to accommodate you, George. Information is being sent today." So we got that kind of attention.
It's been a long discourse about Adler and me, but it was funny. One afterthought on it. My kids, even before they met him, used to refer to him as the "laughing man." Bill used to call me in the evenings at home and he'd tell me the letters that he had gotten in response to some of the screwy letters we'd written that day and also some of the letters he had written. Bill would be so overcome with the whole thing that he would just sit, and hold the phone, and laugh. For about two minutes he couldn't talk. I would hold the phone up to my family and say, "Listen to this idiot." So he was the "laughing man."
DUDLEY: Great story.
CONROY: I think everyone who was in the business in the early days knows about the John Walson vs. Bob Tarlton controversy. I don't think that anybody really knows the answer to that. I think Bob's information is probably a little better documented. I think the truth of the matter is maybe that there were a half a dozen people that started around the same time, in different places. Except for Spelvin, of course: we know he started in 1944.
The clearly-documented instance is Ed Parsons out in Astoria, Oregon. I think there are newspaper clippings that show Thanksgiving Day, 1948.
There may have been people all over the country who were getting the idea. I think it started commercially, no question about it, in Pennsylvania. But there may have been people we never heard of who were starting systems. I know the Pioneers, and certainly the Museum, should not say who is first; a lot of people were "first."
DUDLEY: Franklin, Pennsylvania, comes up from time to time.
CONROY: It does. Who was operating that?
DUDLEY: I don't know but Strat Smith says one of the early visits he made was to Franklin, Pennsylvania. That is something we've got to dig into and find out what was going on out there.
CONROY: The city ought to have some records. That's interesting. One of the stalwarts of the industry all along has been George Barco. George was in it early, certainly around 1953, as far as I know, and was one of the early Board members. His name crops up in the minutes in 1953 or 1954. I think George was president of the Association after Bill Daniels. George has a very sharp mind. He has always brought his legal expertise to the Board meetings.
I remember the membership meeting in San Francisco. That was just before Irving Kahn got on the Board. Irv is quite a man with a verbal argument, and is well versed in the rules of order. I forget the topic on which they were debating at the time, and I'd never seen George Barco beaten before. Irv out-maneuvered him in a parliamentary way and, whatever was going on, Irving emerged the victor. George was very quiet for a while after that. The rest of us were surprised. I had never seen George put down like that. It's interesting to note that Irv and George are very, very close friends, and have been for quite some time. It was George who, when I talked to him about a museum idea, brought up the idea of Penn State. It was George who led us to Penn State, and to the entity that has been created.
Irving Kahn, I'm sure, will be on everyone's reminiscences. Irv bought his first system from Bill Daniels. I think it was in 1959 in Silver City, New Mexico. Most of us met him first at the meeting in Miami, at the Fountainbleu in 1960. Irv put on a demonstration of what he called Participation or Key TV, a form of pay television. I think I mentioned earlier that we were all a little bit antsy about this because of our copyright problems. Irv has always been a dynamic man in the industry. Just full of ideas. It's very unfortunate that he got into those difficulties in Johnstown, Pennsylvania. Probably the fault lay as much with the city councilmen and the mayor as with anyone. This was a franchise renewal and they were holding Irv up and really asking for some kind of contributions and so forth. Irv was put in a terrible position in trying to hold on to his company's franchise. I remember when he came back into circulation, we had invited him to address the Texas Association at our Dallas meeting. We wanted to get him back into the fray. His opening line was memorable. It went something like this, "... and as I was saying, before I was so rudely interrupted." That brought down the house. Everybody stood up and applauded. He had been a force and he became another force in the industry. He is another marvelous man. He used to be quite a cigar-smoker. I guess he's given that up. I don't think he's given up wine-drinking. He was always a connoisseur of wines and may even have owned some vineyards in California. He's still very much a force and a very entertaining man.
Wally Briscoe died this past April. May he rest in peace. Wally came to NCTA in the late 1950s or early 1960s, I don't know the date. He came on board as an assistant to the president to help with all kinds of things. Wally used to scout cities for conventions, put on the conventions, be the Association's man working with the professionals. Wally was another hard worker. And a very bright and astute fellow. He was from Arkansas and I think he came out of radio in Arkansas. For a while he was on the staff of one of the congressmen. I think it was possibly Oren Harris from Arkansas; I'm not certain. He had not only radio experience, but he had some Washington congressional experience. He was regarded as particularly valuable to the NCTA. Wally had great contacts on the Hill. I don't think he could be regarded a lobbyist in that sense but he was one of the people at the Association who certainly was involved in any activities that we had. I know that in my year as chairman, even working as a committee chairman, Wally was always right there to help. During my chairman year he was pretty much my right arm, he and Bob L'Heureux.
DUDLEY: He was not a cable operator, was he?
CONROY: He later became one. When he resigned from the Association, he came down to Houston and worked with Cliff Gardner. Cliff Gardner and Associates. Cliff's company sold earth stations and the associated equipment. Either then or a little bit before then, Wally invested in a cable system in the North Carolina area. He had a company called Gem Cable. So he became a cable operator. In fact, I think shortly before he died, he was able to sell those. When Cliff Gardner quit that business to go back as a broker, Wally was working for different people as a consultant. He did, indeed, become a cable operator. It's hard to work on the outskirts of this business, and not want to jump into the water and see how it is.
I've mentioned Bob L'Heureux. Have I covered him before?
DUDLEY: A bit but not in as much detail as I think you might.
CONROY: Bob was from New Hampshire. In his early years he spent maybe eighteen months or so in the seminary studying to be a Jesuit. I think he liked to date girls too much, so he said he left the seminary. He studied law at Georgetown and became an attorney. For a while he was with one or another government agency, one of the commissions. I don't think it was the FCC. At any rate, at that time, Strat Smith was not the executive director any more. Ed Whitney was. After Ed left NCTA, Bill Dalton became the first paid president. He was followed by others, including Fred Ford. Strat Smith was general counsel, and I think Bob L'Heureux came in as general counsel because Strat needed to quit because of the press of work in his own law firm, Smith & Pepper.
Bob came on board at the San Francisco convention in 1961. He was involved in a lot of the Association's legal activities and filings. I became closely associated with Bob primarily because of the involvement with the Pole Line Attachment Committee. Bob and I made various trips to New York to negotiate with AT&T. He wrote up a whole series of papers for NCTA, the theme of which was that cable television is not of the nature of a public utility. It was really a series of White Papers that we put together. He dated it to come out on a July 4th, so he called it Cable's Independence Day or something like that. Bob was always avidly after us to make sure that we did everything we could to keep out of the clutches of any state utility commissions. I wish I still had those. I'm afraid I don't. I hope the Association does but I'm afraid they don't. It was a whole series of arguments developed for the use of cable operators in trying to stave off these attacks at the state level. There were whole reasons, legal, business, and others why we should not be regarded as public utilities.
Bob was another man full of stories. Fortunately, I've still got some of these on tape. He could tell one story after another. With his religious background, he'd tell a lot of stories about nuns and priests. Some of them got pretty profane but they were funny. He had story after story.
During my chairman year, we had a meeting down at Nassau, in the Bahamas. Just to digress a little on that, the reason we had it there was because I had talked to several of the board members and the staff and I said, "Wouldn't it be good to have a board meeting on a cruise ship sometime? If we could take four or five days. We wouldn't have to meet constantly but all of us would be on board and available to have a good series of concentrated meetings and maybe have some wide-ranging think sessions. Try to do a little industry planning rather than struggling all the time to just put out fires."
That's what we were doing in the early days. One crisis after another would come up and we'd go from one to the other. We were really kind of firefighters. We never had any chance to sit down and reflect on where we wanted to go. I thought this might be an opportunity to do that. There were various problems. At the meeting before this, our summer meeting, Irv Kahn suggested that it could be done in Round Hill, Jamaica. I think it was Wally Briscoe who came up with accommodations at the Nassau Beach Hotel. That was one of the best and most enjoyable meetings that I can recall. I remember years later when I would meet up with Bob and Betsy Magness, Betsy would say, "Let's get back to the Nassau Beach." She thought that was great. We would be in the meeting and ten minutes later we were all on the beach, splashing around in the surf and having a great time.
This was 1965. To place this in context of electronics, this was the year that Philips brought out the prototype of the cassette recorder, called a carry-corder. At the Denver convention that year, I brought one with me. At the Cherry Creek Inn in Denver, there was a piano player named Bob Dorch. Every night I would go out there from 8:00 or 9:00 and stay till 2:00 in the morning to record this ragtime piano player, Bob Dorch. Nobody had one of these recorders or there were very few. I think the cassettes in those days were just 30-minute cassettes. So I brought one of these with me to the Nassau meeting and used it at a time when Bob was launching forth with one of his stories or a whole series of stories. So, fortunately, I've got Bob L'Heureux captured. Several of the board members were part of the conversation. I'm glad I had Bob on that. I recall that meeting and in my mind I can hear Bob's stories but it is good to actually hear them on a cassette today. At that meeting we hired Bruce Lovett as an assistant general counsel, who later became General Counsel. I've mentioned before that Bruce was taken on to fight the 214 case. Along after that came Gary Christensen, who was another activist. When Bob L'Heureux resigned from NCTA, he went to Strat Smith's firm and for a while it was Smith, Pepper & L'Heureux. Unfortunately, he took sick and just couldn't continue, and died in, I think, 1969.
End Tape 5, Side A
CONROY: I mentioned Gary Christensen. I worked closely with him as I did with every one of NCTA's general counsels while I was involved with the Pole Line Attachment Committee. That includes Bruce Lovett, and even a man following them named Steve Gold.
Gary was an activist. By that I mean whether or not an issue had anything to do with the Utility Relations Committee, whether it was pole line, or relations with the states, Gary would say, "You know, this is something that we ought to look into." I would say, "Gary, this has nothing to do with our committee. It ought to be considered by so and so." He'd say, "Yeah, but so and so won't do anything about it, and we can get something done here." I'd say, "Well, what's the rationale for our considering this thing?" He'd say, "Okay, here's the rationale." Suddenly we began to take up a lot of issues that really didn't have a lot to do with us, but they were on Gary's agenda and he wanted to do them. Gary is a very personable, very able, very fine young fellow. I think he was from South Dakota.
I can recall one time when we went to the Lake of the Ozarks for a meeting of the NARUC (National Association of Regulatory Utility Commissions) Board. We were invited to meet with them. Gary, Bruce, and myself. I think Gary was assistant general counsel, and Bruce was general counsel. I was tagging along as committee chairman. This is in a very pleasant part of southern Missouri, a lake region. I don't recall much about the meetings except that we went over some of the same old things about cable TV being better off under state commissions than under the FCC and we met a lot of their people. I know one member of their committee at that time, Brendan Byrne, who was attorney general of New Jersey, later became governor of New Jersey. Again, it was an attempt by Reese Taylor to persuade us that we should use our good offices to bring the cable operators under state control rather than federal. Of course, as our problems with the FCC increased, their efforts increased to persuade us that they were the road to the promised land. Certainly not without any regulation, but without federal regulation. We didn't see it that way, but we wanted to hear them out.
I can recall a couple of little things that happened there. I think we were staying at a Holiday Inn, we had finished a meeting in the middle of the afternoon, and there were a few people around the bar. There was a piano on the stand there. It must have been a country band because there was also an instrument that I call a tub, actually was a wash tub with a broom handle sticking up, and a piece of line. By putting tension on the line you could tune it up a bit and play it like a string base. But it was tub thumping. I got up to the piano and started to mess around with it, and Gary took hold of the tub and he was thumping away on that. We played like that for a bit and people were buying us drinks. I was telling them, "We've got another show this evening; this was just a preview. If you want to hear the full thing, come on back this evening." People were throwing tips. I think this was one of Gary's highlights as assistant general counsel. He got paid for playing out in the Ozarks. Funny, screwy things. We were there for a couple of days and it was very pleasant.
I'm not a golfer, but Gary and Bruce went off one afternoon when we didn't have a meeting and played golf with Reese Taylor, of Nevada, who was chairman of the NARUC committee. I found out there was a fish hatchery nearby. We had rented a car, so I took the car and drove about twenty or thirty miles to the hatchery. I rented a fishing pole and tackle, and ended up catching several pretty good-sized rainbow trout. I brought them back to the motel and into the kitchen. I said, "Could I prevail upon you to cook these for this evening?" We were having Reese Taylor and several of the commissioners over for dinner. The cooks said they would do it. When everybody sat down, I told them that I had bigger fish to fry that afternoon than playing golf so here's a batch I caught. We had a very nice dinner. I must have caught six or eight trout so there was plenty for all of us.
One other thing I remember from that meeting; Bruce will remember it, too. I think I had them snowed for a while but not for long. That particular time there was no moon and it was really, really dark. I remember telling Bruce, "You know, this has the reputation of being one of the darkest spots in the country. Do you notice how dark it is here? The reason is that the minerals in the ground have a magnetism that suppresses any kind of light at night. The minerals soak in the light and absorb it." He said, "Come on." I said, "Bruce, It's a fact; you can look it up." He said, "Well." The next morning he said, "You know, you're full of shit." I said, "Well, why did it take you so long to figure that out?"
There is another fellow who's kind of dropped out of sight. I guess he's been out of the cable business for some time. I mention him for a particular reason, Doug Dancer. He operated a system in Naples, Florida. He was on the Board back in the 1960s. Naples is considered a resort town. Doug was telling us his system for scheming rates down there: he charged by the year. There were a lot of snowbirds who would come down from the north for only part of the year. He would charge them for a full year, no matter how long they stayed. He said, "Not only is this good financially, but we don't have to go out twice a year and hook them up then unhook them." I said, "Do you have any objection?" He said, "Well, I don't know. They're paying." I'm not sure if he did this to the year-round residents or if they were on a regular monthly basis. I think that practice has been adopted in a lot of places now, as a means of handling the well-to-do people in those resort areas. Charge them by the year. Leave it turned on and use it when you want.
I guess there are other people I could talk about but I have touched on some of the more immediate ones.
Oh, I might mention Al Stern. Al was brought into the business by Bill Daniels in the early 1960s. Al had worked with NBC and had a wealthy background. I somehow remember his family being associated with Sears and Roebuck, as heirs. I'm not sure about that but he had funds. Al operated a bunch of systems out of a Rockefeller Center address in New York. Gordon Fuqua, of Bluefield, West Virginia, later went to work for him as general manager of the systems. I wanted to bring up Al because he excited a lot of animosity among various people, including Frank Thompson.
Early on, when we were beginning to get hints of copyright problems, Al said he felt that we would end up paying copyright fees. I'm not so sure that he was saying we ought to pay copyright fees. I think he was being a realist and saying this is the way he saw it evolving, and that, ultimately, we would pay copyright fees. I think a few people seized on that and felt he was advocating it. I don't think he was. However, Al was a very reserved individual and wasn't one who would join us in our after-hour visiting sessions. After the meetings he would keep pretty much to himself. As a result, I never really got to know Al too well and I'm not so sure that many other Board members did either. I sometimes had a feeling that he felt that he might be a cut about the rest of us and sort of tolerated us. He was a difficult person to get to know.
DUDLEY: Could we take a look at some of the things facing cable now and get your comments about them? Among these, high definition television. We talked briefly about that, not on the tape. Also, satellite dishes, and consumer friendliness of cable once it gets into the house.
CONROY: Well, I'll take them in the order in which I know least about them. I think I know least about high definition television. From what I have read and understand about it, the pictures on HDTV, with the big increase in lines per inch, are much clearer with a great deal more definition than our present system has. To my knowledge it isn't compatible with any TV sets that we now have. Certainly is not compatible with the television broadcasters equipment. You need special equipment because it covers much more frequency band. Cable amplifiers could not accommodate it either, or if they could be revised to do so, there would be many fewer channels than we have today. I honestly don't know what kind of a bandwidth this uses. It's more than the present bandwidth of six megahertz, I just don't know that much about it. Cable may have had an easier time accommodating to it than broadcasting. It may have to be a specialized service and you would need a separate set in order to receive it. I've never even seen a demonstration. I don't think it's in common use any place. How about in Europe?
DUDLEY: I think Japan probably is the leader in its development. I don't know if it is actually in use other than in experimental cases.
CONROY: I think if it were brought in and forced in, there would be political problems. There would be an uproar. I'm not saying that because it's an innovation that it has to be suppressed. I just think it doesn't seem to be compatible with the scheme that has been developed in this country. Cable would not be the only thing affected. As you suggested yesterday, the only thing it's compatible with is the electrical outlet in the wall.
DUDLEY: Satellite dishes. Now that we have scramblers and descramblers, what do you think is the future of that technology?
CONROY: First of all, let's take people who live in remote areas. Cable is never economically going to go out and wire up those areas. I doubt that there will be a real REA act for cable to get out there. Satellite dishes can take the pressure off cable to serve those areas. It might be very helpful. By the same token, there has to be a scheme, and I think one is developing. These people can receive programs that are on satellite. I'm a dish-user myself, but I don't think, necessarily, because the signal is up in the sky, people have an automatic right to it unscrambled. I think people ought to be, and many of them are, willing to pay a reasonable fee. I don't think that they should pay more than cable customers pay. After all, they're providing their own delivery system. I think dishes are going to continue to be used and once people get used to the scrambling, the sales may pick up again. Right now they're in a severe decline. I think that's the fault of the salesmen and the manufacturers. Some people were led down a trail to believe that scrambling wasn't going to happen. I noticed that even the scrambling bills proposed now are not so much anti-scrambling as making sure the signal is reasonably available to people who want to use dishes.
I also think that they'll provide some competition to cable companies in the built-up areas where cable already is. I used to have a system in Port Arkansas (on the Texas gulf coast) which I sold in May of 1982. I continue to go down there because my family has a place there. I've seen more and more of the condominium market there, which I thought was going to be a great market for cable. That was one reason I put the system in there. In recent years, many condos have apparently abandoned the use of cable in favor of putting a couple of dishes on the roof. In that kind of situation, and in motels, you generally find satellites in use. In that respect, it is going to have a competitive impact on cable. As to the individual homeowner, yes, you see the dishes sprinkled around. I think it's just one of the many competitive things that cable will have to contend with, including VCRs and all other forms of entertainment and education that compete for attention.
What was the other thing you mentioned?
DUDLEY: The VCR friendliness.
CONROY: Oh, yes.
DUDLEY: Not just VCR, but cable friendliness with the multitude of components now in the house.
CONROY: Take the case of a cable customer who, before he was connected, had a set and a remote control and everything is nice and handy. Then cable comes into the house. If the subscriber doesn't use a converter, he can still have a use for his remote control, at least for his twelve channels. When the cable comes in, if it uses a simple converter, it's running on Channel 2, 3, or 4. His remote control is of no further use. He can use the cable converter box for the cable channels. The complications come in, however, involving the ease in which he used to be able to use a VCR to record programs. He might want to watch one program and tape another. That becomes increasingly complicated as we put the cable converters and descramblers in the house. Because of the nature of these things, you must then install a series of splitters and a spaghetti-like array of wires, just to record something while you're watching it. If a service or channel is scrambled, the consumer has extreme difficulty in recording.
This builds up a wall of antagonism. Although I am not now in the business, I've talked to enough operators and listened to Museum board members to know that it is a severe problem. Cable is supposed to be a convenience and here we make it very, very difficult. In some cases, it is impossible for people to do what they want to do with other pieces of equipment in the house. I've wondered myself if descramblers and cable converters could have circuitry designed and introduced into the box itself, so you could just tap into it for either a scrambled or unscrambled program. You might have to have two or three different taps where you could plug in a jack, hook it to your VCR, and avoid all this big array of things that are necessary outside. Let's put all the splitters and everything into the box. It would probably increase the cost of the box, but I don't know how many cable operators nowadays charge for the use of that box. With a specialized box like that, a special one-time charge could be made to cover the cost. It is a problem.
You've seen the array of wires behind my own set-up in my home. That does not exist because of a cable descrambler, but it is simply the way that I've set my own thing up for different inputs. I even took a call recently from a friend who lives in Staten Island, New York. Cable recently came by his house, was installed and he ended up having to buy a second VCR, to accomplish what he was accustomed to do with his VCR previously. He can afford it all right. When the cable people came by, that's what they said, "You might want a second VCR, and even pay for a second descrambler box." This gets to be a little bit hairy after a while, and cable then begins to look like a very unfriendly service. I don't care if it's a big town or a small town, everyone is pretty sophisticated these days. Everyone has heard of VCRs and other devices. Cable better take steps to insure that it remains in a friendly atmosphere in the home or people will just say, "The hell with it." You can rent movies at a pretty cheap rate these days and not have to go through the hassle of dealing with the cable company.
DUDLEY: In addition to there being a consumer-relations problem, there is also a very real technical problem with growing numbers of people jerry-rigging their cable into various devices. As I understand it, if the electronics is not really clean, and the connections are not really clean, they could be deteriorating the cable throughout the community by feeding back into cable.
CONROY: I'm not so sure about that, Bob. If you get it back as far as the tap, you've got a resistance network in there. I don't think that too much of that gets back into the feeder. I may be wrong but it didn't use to happen. You can, however, radiate out all over the place and cause interference with people around you who may not be using the cable. I'm not so sure how much the signal would feed back into the cable beyond the tap-off.
DUDLEY: Joe Aman of TCI was talking about it last August when we met with the Education and Training Committee. He said that it's a real big problem, not just radiating but feeding back into the cable.
CONROY: I noticed in TCI's most recent annual report a page explaining and even diagramming what they're showing their customers so they can be more friendly. It still involved a little circuitry that needed to be installed.
Editor's Note: The following comment was made after the recording session. The audio is on the addendum cassettes.
Super conductors. Depending on their development, I think that the super conductors may well have implications for cable, especially if there is a way to enclose the super conductor in coaxial cable without destroying the super-conductive properties. This could mean more reliability, fewer amplifiers, and cleaner pictures. In my mind, a development similar to fiber optics but, of course, a completely different technology.
End of Insert
DUDLEY: Do you have anything else you would like to discuss? We seem to have covered a lot of territory. We have about seven hours of tape.
CONROY: I'd have to pause and think. I think we have covered a lot of ground. In reflection, I would like to hark back briefly to some of the days in Uvalde.
Once I left there and until I got back into the little systems that I wound up my cable career with, I ceased to be an actual cable operator and became an MSO operator of cable systems. I bring that up because whether you own the system in the town that you operate or whether you're an employee-manager, I think it is important that the cable person in town maintain a very, very high profile, to the degree of making himself very available. It really cuts down on your own personal time. I'm talking about taking part in various civic activities and Chamber of Commerce activities. During my time there, I think I did everything except be on the school board.
I ran the United Fund campaign one year, and I remember Tulley Garner gave me a plaque because we got 105 percent of our goal, although, I think, I probably excited some animosity. I was fairly fresh out of the Navy, at that time, and I had formed committees to accomplish the campaign goal. I think it was the Girl Scouts that I offended. They participated in the funds once we collected them. Therefore, I wanted them to provide so many workers to go door-to-door to help collect. They were falling behind in what they were supposed to be doing and I wasn't getting their cards in. I said to the Girl Scout leader, "If you don't want to see that your people go out and do this, I will personally see to it that your organization doesn't get the funds." I said, "Either shape up or get out," in that kind of Navy language. She let her jaw drop and she said, "Well, I guess we'll get to work." That wasn't good community relations, but it paid off. We got the job done. I think you need to be willing to serve on different things when people ask you.
I was friendly with the mayor at all times, but there was one mayor in particular who served for quite a while, and I was on very good terms with him. He was an activist. He asked me to serve on the planning commission, and I did. I began to learn quite a bit about how cities were planned and run and some of the activities of cities: running the utilities, the gas system, the water system, and the sewer system. This particular mayor was going out of office in the early 1960s. He came up to me and said, "I'm going to be leaving office pretty soon, and I don't know what the composition of the council will be next time. Is there anything you would like to bring up before this council so we can get it done now?" I said, "Melvin," his name was Melvin Roland, "we're going to be installing an expanded microwave system that is going to cost us quite a bit of money and we're going to be bringing in some additional channels." I said, "On a long-range basis, I would like to ask for a bit of a rate increase, but I also would like to get my franchise renewed for another ten years." It wasn't going to be up until 1965 and this was 1962. I said, "I would like to do it because if we're going to expend this much money, I'd like to feel that we're going to be around long enough to recoup it and make a return on it." He said, "Get your material together and we'll get you scheduled." I did and I made a 45-minute presentation to the council on both those points, the rate increase and the franchise renewal. It had been advertised as a public hearing, and there were one or two people from the public there. I got one or two questions from the council and on the first vote it was approved on all of it.
Naturally, before that happened, I had talked to every one of the members on the council. I knew enough to do that. Of course, it had to happen on three readings, but it just sailed on through. Once that was done the mayor's next comment was, "Now I'd like you to run for City Council." I said, "I didn't know you had all this in mind. It certainly is the right order of things. I would not want anything pertaining to the cable to come up while I was on the council. If it did, I would have to abstain from anything having to do with it." He said, "You're clean now." So I ran for the council and was a city councilman there until we built a new home just outside the city, and I had to resign.
Nothing pertaining to cable came up while I was on the council. A very interesting thing did come up, however. The phone company came up with one of its periodic rate increases. At that time, we, the cable company, were involved with Southwestern Bell and they were on one of their pole line increase hunts. I must confess that I was venal enough to use the occasion to request all kinds of depreciation information on their plant in town. I remember their manager asking, "Do you want this for this purpose here or are you looking at it for another purpose?" I said, "Joe, I want it for this purpose, and I also want it for another purpose." No sense being anything less than blunt. I must add that I was the utility commissioner on the council, so I was the lead man in this rate-increase proceeding. However, just to be completely ornery, I put them off for at least eleven months until, finally, they brought a big delegation down from Dallas to make a presentation. We ended up doing what I knew we would do from the beginning: we gave them half of what they asked for.
That's just an anecdote in my general theme that a cable operator just has to be out there, and keep his name in front of the public.
We had one manager of a system in CPI whom I tried to call at home one night. This fellow had an unlisted number. I called him the next day and I said, "You'd better get yourself a listed number by tonight, or you don't work for us anymore." I know why he would want an unlisted number because I've gone through it. You've got cable problems--you have outages, you have co-channel--people are calling and you can't even eat your meal when there are problems because it's a service that people care very much about. I said, "You've got to be available. If you don't want that, you can go some other place." So he got a listed number that day.
That leads me into another thought about the nature of the business. At least when I was in it, and I think it still is, the provision of cable service to a community is a very, very personal thing. It's much more personal than telephone. Telephone is important. When my telephone is out, I'm lost, too. But you've got your telephone, your power, your water coming in, and I don't know of anything that people get more uptight about, particularly in communities where no other source of television is, or was, available, than their cable service. I think it's a very personal and important service that we render and we've got to take it very seriously. Often it is treated on a cavalier basis. Customers will get the idea that cable operators have no investment in this thing; they've just got this little piece of wire coming into the house, it doesn't cost them anything to run it, and here they are just brushing us off. That's all part of your appearance in the community. I think it's important to tell people how you feel about the service, that you know it's important to them, and outline what your costs are. You don't have to show them your balance sheet; just tell them generally what it costs to do one of these things. What it costs to microwave. You can tell them how much it costs per mile. The problem with that is the tax assessor might be there and he'll get you the next time around; of course, he'll get you anyway. I think you should let your customers know that you have a lot of expenses that they don't even know anything about. A lot of people were surprised to find out that we had to rent space on poles. Pole rentals used to be one of our biggest expenses. I think one of our biggest expenses these days is programming, and the cost of satellite programming. I think it's important that people realize what it takes to run your business. Running an ad in the paper doesn't do it. The only way to do it is to have talks and have visits, one-on-one, with people until, gradually, they understand that you have something here that is more than a little piece of wire that comes into the set.
DUDLEY: Very true. I think that's where cable systems have fallen down. Not really explaining the true cost of doing business. When a rate does have to go up, whether it is fifty cents a month or three dollars a month, operators can justify it. But they need to tell the public about their costs.
I thought of one other thing that has to do with development of the industry. Because you were involved in so many different systems, what kinds of considerations or criteria came into play when you were selecting equipment from various manufacturers? You started out with Jerrold?
CONROY: That's correct.
DUDLEY: As you expanded, as you did re-builds, as you went into new communities, what went into the decision to use Entron equipment or CAS equipment, SKL or RCA or what have you?
CONROY: In the early days, as you say, we did use Jerrold. We were almost locked into them. As I began to go to cable conventions, I became more intimately acquainted with the various types of equipment that were around. I had seen them advertised, but had never had much opportunity to use them and experiment with them. Several years later I had used C-COR, SKL, Ameco. I had used some of Johnny Campbell's stuff. I've used a variety of different manufacturer's equipment. Jim Stilwell was a big help with this. Jim would take prototypes or take samples of the equipment. He would put it through the paces and use it and see if it conformed to specs. Usually, our selection of equipment was based on technical reasons and not the price. If we accepted something technically, then we negotiated the price. If we were buying in big enough quantities, we could swing a favorable price. Price was not the first consideration. The first consideration was what kind of a picture is this going to put on that screen.
I had moved away when the first major re-build of Uvalde and Del Rio came about; this was around 1970. I was interested in and impressed with what I had seen as performance figures with Jim Palmer's C-COR equipment. By this time, of course, it was solid state. I'd had some experience with Jerrold's Starline 1, which was good, but there were maintenance problems associated with it, particularly in the early models. I was anxious to try out C-COR's line. I had heard from other operators and in visiting with Jim Palmer and some of his engineers that this stuff was as close to maintenance-free as the industry had in those days. You could put it up on your poles and it would just rock along there. You didn't have to worry about the changing levels in winter and summer. It was a real performer, so we used that particular equipment at that time. I'm happy to say that reports from Faber Spires and Glen Scallorn about this equipment were that the system was much more trouble-free than anything we had before. That means it cuts down your cost. You don't need to send people out in the middle of the night to correct deficiencies. Routine maintenance became much easier. You always have to have routine and preventive maintenance to try to find the problems before they come up. Our considerations were always what was the best performer technically for our purposes. There are different amplifiers for different purposes. We might use a completely different manufacturers equipment for long trunk run than we would for a part of the system that was in the distribution system in town simply because of its characteristics. The industry got much more sophisticated to where you were looking for how transparent a picture was. Particularly on any of the long runs after the cascade of twelve or thirteen amplifiers. After testing, we would get at the price.
DUDLEY: It was technical: what will this do now? But also life cycle 442 and performance.
CONROY: How long will this last? We used to go through five-year cycles in the industry. It's not that the equipment wears out; it's a question of obsolescence with some new piece of gear or some new concept or moving into a wider spectrum.
End of Tape 5, Side B
DUDLEY: Let's wind up by talking about a few things that don't have to do with cable. Music, for instance. You mentioned early on in the recording that you have an interest in music that began as a youngster and stayed with you all of your life.
CONROY: That's correct. Whether it was in the Navy or in cable, somewhere, some way, there was a piano around. Even in Uvalde, I joined a group in the Lions Club where there was a fellow who ran a shirt factory making work shirts in the Williamson and Dicky plant in Uvalde named Art Chaney, who played cornet. There was also an accountant named Henry Dalrymple. He played string base, and his stepson, Dave Spangler, played guitar. We called ourselves Art Chaney and his Gin Bottle Four. We'd rehearse at my house and I have some tapes of those rehearsals. We put on shows, not only for the Lions Club, but occasionally there would be some other thing going on and we would go up on the stage and do our little thing. Jazz or blues-oriented things. Art was pretty good on the cornet.
I'd go to conventions and always sit down some place and play. When I started going up to Effingham, the only way to get there from Texas was through St. Louis and then rent a car and go to Effingham. There was a small airport there but no commercial activity. I would spend a night in St. Louis and, at that time, (1962) there was an entertainment area called Gas Light Square. There were a few music places, folk music, food and restaurants. It was a nice area. In the course of time, I met a group called the St. Louis Ragtimers, a four-person group. A very fine piano player was associated with it, plus a banjo, a tuba, and a cornet. Later (in 1965) they moved on down to the Goldenrod Showboat on the Mississippi levee. Any time I was going through St. Louis, usually on the way to or from Effingham, I would spend an evening on the boat listening. I'd play a little piano, too, but those people were much better than I. They were professionals. They were ragtime-oriented and I played more blues and boogie-woogie.
In 1965, the annual Ragtime and Jazz Festival on the Goldenrod Showboat was inaugurated. The Goldenrod did not go out on the river; it just stayed moored to the levee. In fact, showboats were not self-propelled boats; they were towed from town to town. When you hear, "Here comes the showboat" and see a steamer coming, those weren't the showboats. The Goldenrod has a historical marker on it. I think it was built in 1907 and was used, I think, in the movie "Showboat." It stays moored along the levee in St. Louis and is the scene of a number of musical events. The festival still goes on and I'll go up there this June to play. In between bands, some others and I used to pop up and play a couple of numbers on the piano. I guess by osmosis, I got to be an official part of the program.
I met a fellow named Charlie Booty on the boat in 1970 and we teamed up on piano duets. About 1974, they said, "You've been doing this for so long, you might as well not pay to get on the boat. We're going to give you a ribbon, and after this we are going to put you on the program." So sometimes we would be on as intermission piano players for half an hour or forty-five minutes. Just last summer I went on the boat Sunday afternoon at the beginning of the festival. It wasn't due to start officially until the next morning. My friend, Al Stricker, the banjo player, said, "Hey, our band's going on in the theater, but there is nothing there for half an hour." He said, "If you want to play, go down and play for half an hour." So I said, "Sure, Al." I went down to the auditorium stage and played for a while and then they came on. It's a very informal, easy thing, but it's a real fun thing.
I've gotten to know a lot of people from all over the country, just because of the music. It was a case of dropping out of the business world and right into the music world. It's a completely different world. I know some people will come up and say to me, "What do you do in real life?" I would say, "Isn't this real?" "This is real to me." That has gone on for a while. I don't do much playing of that type around Austin, except at home and at private parties. The music scene is different here in Austin. It's redneck-country-rock and Willie Nelson. I enjoy country music, folk music, everything except pop. I like classical, I collect it. I have a complete collection of Caruso. It's kind of eclectic hobby except I never liked what we call pop music.
One other organization that I belong to is the Ragtime Society in Toronto, Canada. This has been in existence since the 1960s. It's more piano-oriented--not as much band-oriented as St. Louis. I go up there in October for a weekend event.
I've met a lot of people, again, from different parts of the country and Canada. A lot of real good piano players. You may recall Eubie Blake who died just five days after he reached 100, three years ago. Eubie used to go up to the Toronto bash. A lot of pretty well-known people such as Max Marath went, so I've gotten to know a lot of those people. One Sunday afternoon up in Toronto we were having an informal session unlike the more formal Saturday night program. I was playing the blues and Eubie gestured. They took a mike over to him and he said, "You know, that brought tears to my eyes because I could just see my mother scrubbing on a washboard." He said, "That young fellow up there ought to be black." I got a kick out of that.
DUDLEY: Great compliment, right?
CONROY: Yes. I've kept up with the music and actually have participated with Charlie Booty in making two records on labels that specialize particularly in jazz music. We've recorded two duet albums for them. These things don't make much money. I think they've made about a thousand albums of each. I know one of them is pretty much sold out. Also, we have each recorded another solo album for the same outfit, but those haven't been issued yet. We are treated just as talent anywhere. This last time we went into a studio, recorded our things, and the man gave us our check, and that was that. The previous album we had recorded on the Goldenrod. All three albums have been done in St. Louis. The Effingham system is an indirect cause of a lot of musical activity I might not have had otherwise in and around St. Louis.
DUDLEY: The stage outfit that you wear, at least the times that I've seen you, has to do with railroading. That's also a part of your interests, isn't it?
CONROY: Yes. Railroading has worked its way in and out of music a great deal. A lot of songs have been written about trains and railroads and "getting away." I have been particularly interested in steam locomotives. My grandfather in Vermont was a railroad engineer. He ran the "highball" freight train from Island Pond to Portland, Maine, and back. He spent forty-five years railroading. I think he retired around 1939 or 1940 and he died in 1951. He was an engineer as long as I knew him. When I was a small kid, his train would come in from Portland every third Saturday around 10:00 a.m. We only lived a block above the tracks and I'd hear his whistle--I'd been waiting for him. I'd run down and he'd just be unhooking from the freight cars. I'd climb up in the cab and we'd go up to the switch and then steam on back to the shops. I would toot the whistle a couple of times. I would wait for my grandfather while he wrote up his report. He always left a little bit of his lunch for me, a piece of pie or a doughnut. So while he was doing his reports, I would eat the pie and walk around the roundhouse and look at the engines. It was a railroad town; that was its main business and you would always hear the steam engine whistles. In 1932, we moved to Brooklyn, but I'd go back to Vermont in the summers and my grandfather and I would go fishing and go berrying. He had a farm as well. We would go out there, and I would help with haying. He also had a garden in the back of his house in town. I think I got my interest in gardening from him as well as a life-long love of trains. We were great friends. I still like to travel by train and I've got a lot of books and videos of steam locomotives.
Occasionally I'll make a trip up to Louisville to see my friend Charlie Costner, who works for the L&N Railroad, and we'll go on a steam excursion trip. I've got a lot of pictures around the office of engines, some of them with my grandfather. Lots of books on trains and railroads. It's a fascinating subject. It weaves its way in and out of music as well. There are all kinds of songs and traditions that relate to trains in music. They just marry well together.
DUDLEY: You've mentioned gardening as well.
CONROY: Yes. You've seen some of the results of my gardening. I never did any gardening until I moved to Texas. I had always wanted to and had always liked it, particularly fresh tomatoes. Along with the first house that we moved into in Uvalde, I put in two or three tomato plants. Then we moved to other houses, and I had bigger gardens. I still have a tractor that I bought from Sears in 1962. When we moved to Austin from Uvalde to a house on the other side of town, there wasn't much room to garden but I still had one. I've always had a garden here, at this house, and have many vegetable varieties and, occasionally, I'll put in flowers. I've always liked to grow marigolds; you can put those near tomato plants to help with the bugs. At my office out in Manchaca, I've got an asparagus bed and I planted some fruit trees. Generally, I like to plant what I can eat. I'm not much of a landscape-person. I don't like fooling with lawns, although it has to be done. I don't have any roses. Toni is more interested in that. I think gardening is good therapy and it's good exercise and work. When it's hot and you perspire, you can lose weight just as well as you can running. It's a good time to reflect. It's not a group activity. I'm out there most of the time by myself. It's a chance to think. When I was still in the cable business and had an office down there, from 1980 to 1982, I'd still take time to go outside and do things in the garden and think about this or that pertaining to the systems, a promotion or a problem with the councils. It's a good way to be by yourself and think.
DUDLEY: I think that is a pretty good conclusion.
CONROY: Good. Thank you.
End of Tape 6, Side A