Interview Date: July 26, 2017
Interviewer: Stewart Schley
Abstract
Bill Futera describes his long and distinguished career in the cable industry, starting with ATC, and then launching a round the clock pay-per-view channel sponsored by several different companies. He talks about his transition to United Artists Entertainment, and then moving on to work for Newhouse and Bob Miron. He spent the rest of his career at BrightHouse. He explores his time at ATC in the finance and accounting division, and describes the complexity of billing systems. In addition, he discusses the environment for the industry at a time of massive building and investment, and the bid to quickly bring in more subscribers to generate positive cash flow. He points out the differences between public and privately owned companies. Next, he talks about his involvement at ATC in new business development at a time when programmers provided the cable companies with opportunities to get into the ad-sales business to insert ads on cable networks, competing with radio and television markets. Futera goes on to describes the tension between the movie studios and the cable operators, and the transformation of Event Television to Pay-Per-View Network. But he recounts how eight MSOs and two movie studios joined together as owners of Viewers Choice to offer expanded programming. He comments on viewers’ interest in boxing, and the very popular sport of wrestling. He acknowledges the role of HBO, and the eventual proliferation of programming. He names Bob Miron as very important to his career, then recounts how he initially got into the cable industry.
Futera addresses the issue of how competition from satellites and telephone companies influenced and affected the industry, commenting that one response was to create Primestar. He notes that providing Internet service would be challenging for satellite networks. But he also explains that Google and Amazon use cable technology for free. At the same time, he reports that one advantage of content models like Netflix offer customers more choice than companies having to negotiate deals with programming networks. He concludes with advice for the next generation.
Interview Transcript
STEWART SCHLEY: Well, greetings and welcome to The Cable Center’s oral history series. I’m Stewart Schley. I have the privilege to be talking to a person I think of as kind of the Zelig or Forrest Gump of the cable industry. Bill Futera has sort of done it all, over a 35‑year span. I get to talk about some of his observations about cable, some of the people in it, and the contributions that you made. So, welcome.
BILL FUTERA: Well, thank you, very much. It’s a pleasure to be here. And I run, run, run, just like Forrest Gump.
SCHLEY: OK. (laughs) It’s good to know. And it’s not an inapt analogy, because you really have worked in so many different disciplines, with so many different companies. Let’s do this. Let’s run through the roster of companies you’ve worked for. Do you want to just give it a whirl?
FUTERA: Sure. I started my cable career in 1981, working for American Television and Communications, which was Time Inc.’s cable company that they had purchased from Monty Rifkin. And then I transitioned out of that company to a company called Event Television, of which ATC owned 20% — of. And Trygve Myhren was really the leader of trying to get a consortium of cable operators to do pay-per-view, which is what we did. And then I moved on to New York. My wife and I moved to New York City, to launch a 24‑hour, seven-day-a-week pay-per-view channel, which started, which we launched, as Home Premier Television. And our owners were ATC, Cox, Continental, TeleCable, and New Channels, or Newhouse, at the time. And I left there to come back to Denver, to work for United Artists Entertainment. And after that, when TCI and John Malone, who owned half of United Artists Entertainment, ate the rest of it, I had a number of options but one of my options was to move to Syracuse and work for the Newhouse family and Bob Miron. And of all the choices that I had, it was the one that I really wanted to make. And no regrets. It’s been a great ride. And so I’ve been with Newhouse, I was with Newhouse until I retired. We had a number of things and transactions that occurred. We did a partnership with Time Warner, in 1995, Time Warner Cable. They actually managed the assets of the partnership. And then AOL kind of came in. And the Newhouses had the option to restructure the partnership. And I won’t say AOL was everything of why they did but one of the reasons behind restructuring. And then we launched Bright House, after we restructured the partnership.
SCHLEY: I was going to say you went from A to B. You started your career in cable with ATC and ended with Bright House — working out of Florida, were you? Or were you…?
FUTERA: No, I was in Syracuse. Our corporate offices were in Syracuse. But we had no cable systems in the Syracuse area. The Newhouse family and Bob Miron always felt that you keep corporate away from the operations, to really let the people run the day-to-day operations. So about two million of our two million and a half customers at Bright House were in Florida. And then we had some other locations that we operated in.
SCHLEY: Bill, take me back. American Television and Communications was popularly known as ATC. But you had a different derivation of that acronym. Was it…?
FUTERA: So I started at ATC just several months after Glenn Britt left New York, at Time Inc. And he’d kind of grown up in cable, at Manhattan Cable Television. And they brought him in as CFO. And the company had spent so much capital, over half of their capital budget, in just a little over a quarter. So ATC was also known as All That Capital.
SCHLEY: All That Capital. But it wasn’t unique. This is a point of time, if you take us back, where the industry was building furiously and it required enormous amounts of investment.
FUTERA: Well, if you think about the fact that ATC was a Time Inc. company and Time Inc. was a publicly traded company… If you look at all the other large cable companies at the time, which — whether it was Cox, whether it was Continental, whether it was TCI, all of those — Newhouse — they all were private companies. So they really had a good feel for the business. As a publicly traded company, you have your shareholders and the Street to be concerned about. So when you put together a budget… And the analysts for Time Inc., which was really a publishing company… All of a sudden, all this capital is being spent, beyond what was to be spent. Then it gets the attention not only of the asset managers at the public company Time Inc., but also the Street and the analysts and the shareholders. So they were alarmed by it. But as you said, those who were in the business knew that, the faster you built and the more capital you spent, the sooner you would be able to get subscribers and positive cash flow coming into your business.
SCHLEY: But the difference between putting ink on paper and putting out Sports Illustrated and Time magazine and digging trenches and stringing and lashing cable was immense, from a financial posture.
FUTERA: Well and again, there were cultural differences between the two. And if you read the history of ESPN, which is — there’s a great book about that, the culture between a cable television network and broadcast television, when those cultures don’t mesh and there’s not a real understanding of sort of the financial principles of those businesses, then you can run into some conflict.
SCHLEY: What did you do at ATC?
FUTERA: So I was hired at ATC to help them take their accounting systems and their statistical tracking systems and take them either from a manual process or from an antiquated automated process and put them on an IBM mainframe and work with the MIS or IT department. And I represented the user group. So I was working with the finance and accounting folks there.
SCHLEY: How did billing work, before this transformation?
FUTERA: Well, our business was very simple, when I first came in. And before pay television, the coupon books that people use for mortgage payments — and, again, that’s probably pretty antiquated today, or for car payments, we — billing was we send you a book and you make your 12 payments, and then we’ll send you a new one with the rate increase. And then, all of a sudden, HBO launches and Showtime launches and now we’ve got different price points. And now, all of a sudden, billing becomes more difficult. And then it just got more difficult when you start to do pay-per-view events. And then you have different tiers and so on and so forth. So the back office and billing, which is really not talked about a lot, you know, has been such a critical piece of our business, as we grew. And Tom Rutledge used to say one of the reasons why he advanced in his career is he made sure he was never at a location that going through a billing conversion.
SCHLEY: (laughs) Tom Rutledge, now the CEO of Charter. Why was it so hard? Other industries did billing. And what made cable challenging?
FUTERA: Well, again, because we were evolving from coupon books into multiple price points, into then an interactive piece… The other thing is other companies, like retail… You go into a store, you buy something, and you have physical inventory you grab. So our inventory was our services. So we had to provision those services. And initially, we used to throw everything that we had out and then trapped HBO, if you didn’t buy it.
SCHLEY: It in sort of a negative way.
FUTERA: It was a negative way of —
SCHLEY: Controlling the signal ‑-
FUTERA: — being able to provide the services to our customers. And as it became more complicated and we needed to have addressable boxes for pay-per-view. And really, being able to authorize the business today and the complexity of our billing systems today is immense. It’s immense. But it grew out of a very simple business. And we found — although we didn’t like it very much, we found that having third-party vendors, who could focus 100% of their time on developing billing systems — that that’s the way we went. And today the cable industry continues to rely on third-party vendors to assist them in their billing.
SCHLEY: It sounds hard and, to be honest, to me, it doesn’t sound that fun to orchestrate that transformation. What made it kind of compelling, from your own personal standpoint?
FUTERA: Well, I wasn’t involved as directly on the billing side. I was more on the accounting, finance, budgeting side and tracking statistics, at ATC. We used to have a fax machine and every one of the cable systems would fax in their statistics.
SCHLEY: For the month or…?
FUTERA: For the week. They liked to track weekly how we were doing, in all of these cable systems, like La Grande, Oregon, and Parsons, Kansas.
SCHLEY: How many subscribers you had added or…?
FUTERA: Yes, along with how many pay customers we had. So that’s how we were tracking the business, at the time.
SCHLEY: What else, at ATC, were you involved in, that was important to you?
FUTERA: Well, so one of the other things I was — got involved in — which was new-business development. And one of things that I really just so much enjoyed but also have a great appreciation for is how the cable industry found opportunities to grow its business besides having the dumb pipe. So one of the businesses that the programmers provided us an opportunity to get into was the ad-sales business, media sales, local ad sales, being able to insert on cable networks. And they were hoping, by giving us that financial opportunity, that we’d be willing to pay subscription, which… For their services —
SCHLEY: And that’s…
FUTERA: — which was also coming in vogue in the early mid-’80s. So on the advertising sales side… And I mentioned Tom Rutledge. The first time I met Tom, he was running the Albany system for ATC. And we actually were running trials. So what made that business very difficult is we needed trafficking software and billing software, for multiple networks. There was a company here in Denver, called Columbine Systems, and they were one of the largest providers of back office trafficking and billing, for broadcasters.
SCHLEY: The over-the-air television industry.
FUTERA: Over-the-air television. But you only needed to bill and track for one channel. So we worked with Columbine Systems, to figure out a way, technically, to use their system to be able to bill and traffic for multiple networks.
SCHLEY: Was the early business you would — you would insert advertising on up to four channels? Is that how it started?
FUTERA: Four. And then it grew from there. We actually had an executive, who I won’t — I won’t say who it was but he sat in a meeting and said, “I don’t know why we’re going to spend money chasing these advertising dollars,” you know, “We’re in the subscription business. This is really not who we are”
SCHLEY: That’s forward thinking. (laughs)
FUTERA: “And we should maybe — maybe we shouldn’t.” But as we all know, it’s become a very, very important part of our business, especially in political years.
SCHLEY: I actually track it. And today it’s almost a $6‑billion category and one of the big four revenue sources for the cable industry. You started out in a very humble way and kind of grew it from there.
FUTERA: Absolutely. One of the other things that it introduced to cable, back then, is it was really the first time, other than competing for franchises, that we actually had to compete for dollars. So we’re in the local markets, competing for advertising dollars. With radio and television stations. And we all know that, companies that advertise, they have limited advertising budgets, you know? Anheuser-Busch, during the 1990s, when all these internet companies or startups were coming out… They were going to get all their money from advertising. And if you’re Anheuser-Busch, you basically had to have every family, including infants and all their kids, drink about three cases a week, to make your numbers. So advertising became very important to us. But we had to compete. And I like the idea that that was sort of when we first started to compete with other companies for dollars.
SCHLEY: A legendary figure I used to work for, Paul Kagan, used to call cable a parlay business, meaning you could layer these other revenue-producing ideas and businesses on top of the core, which was the distribution of programming over the wire. Advertising is, I think, is a good example of that. And so was pay-per-view. So how…? You were there! You helped create this category.
FUTERA: So event television was formed by five companies. It was ATC, Group W Cable, which ended up going through a transaction with Comcast, Century, and ATC and TCI — so they weren’t going to stay a partner — Warner Amex, who actually… If you think about Warner Amex, they and Rogers, through Zenith — and Warner Amex, through QUBE, were the companies that were really doing pay-per-view, on a two-way basis. Because they had two-way plant. So Warner Amex was also a partner. And TCI was a partner. And then we also had Caesars World. And they were interested from an event point of view, coming up with events and distributing events. And Trygve and others said, “You know, gee, we ought to do a pay-per-view network, that includes movies,” so you aren’t renting transponders only for a few hours and so on — and you could build the business. And at the time, the studios had Request Television, run by Jeff Reiss. And their financial model was… The studios could not own an entity that distributed movies on a pay-per-view basis. So this was sort of a timeshare condominium approach. Jeff would go out and he would lease transponder space. And then each studio had its share of time slots, in which they would go ahead and run the movies. And then the financial model was the studios would negotiate directly with the cable companies, one-on-one, for…
SCHLEY: Was this to avoid any antitrust considerations?
FUTERA: Absolutely. Because they tried to do something, earlier, even with a company, and I think was called Spectrum, and Justice Department said no. So that was — that was a model that was out there, and the cable guys having somebody negotiate with each individual studio.
SCHLEY: But sharing an infrastructure.
FUTERA: And they’re not easy to deal with. That was a model they wanted to embrace. The other model was Showtime. And Showtime owned a company called Viewer’s Choice. And it was run by a guy named Scott Kurnit, who is a good friend and very, very smart guy. And he grew up in the Warner Amex QUBE systems. And so that financial model was 40% to the studios — and the studios didn’t like that 40% to the cable operators — they didn’t like that — and then 20% to Showtime. Because Showtime wanted to make money.
SCHLEY: Sure.
FUTERA: So the cable operators didn’t really like that. The studios didn’t really like that. So the cable operators came together and took Event Television, which was an event pay-per-view company, and put together a company called Pay-Per-View Network, Inc. that launched in November of 1987 with Royal Rumble and a couple of lousy movies, from Columbia, I think. Because the other studios didn’t want to sell to us because we were a consortium of cable operators and they’re just…
SCHLEY: Those darn cable guys.
FUTERA: After their experience with HBO, they just didn’t want to have to deal with that. So what I — what happened with me is that I had gone to work for Event Television and left ATC, even though ATC really managed it, a guy named Sid Amira, another really —
SCHLEY: I remember Sid.
FUTERA: — you know, great guy. Very smart. He was running Event Television, at the time, and reporting in to Trygve. And so, when we made the decision to go with a full-blown network, Group W was bought. Caesars World said, “I’m not into movies.” In a conversation with Peter Barton, he suggested that TCI was better off doing a 25‑cent rate increase and not getting into pay-per-view and spending a lot of money on addressable boxes. So they pulled out. So ATC kind of stood there by itself. Warner Amex also pulled out because they were a studio, and other things. And so it was really ATC. And Trygve, through his relationship and friendship with Bob Miron and with Dick Roberts, at TeleCable… Those three companies said, “We’re going to do this.” And for a year and a half, we worked on a business plan. And I was the only employee. I used to tell people I worked for a company that had no revenues.
SCHLEY: Was this in Denver also?
FUTERA: I was in Denver, you know, TeleCable. Gordon Herring, and Dean Erickson, who’s here in town, and then Dan Cavallo who is just a tremendous, tremendous mind, who worked for Newhouse, the four of us put together business plans. And we went out and we talked to, you know, Steve Dodge, at American, and we talked to [Jim] Robbins, at Cox, Amos [Hostetter] and Tim Neher, at Continental, and Jim Cownie, with Heritage — and we went around — and Gene Schneider, at United — and we made all these pitches. And so these three companies got Cox and Continental to raise their hand and say, “We’ll do it.” So those five companies, ATC, Cox, Continental, TeleCable, and Newhouse said, “Let’s go do this.” And we went out. We needed a CEO who knew the business, who knew the studio side of it. And so we hired Jim Heyworth, former president of HBO to come and be our CEO. And, again, we launched in November of ’87…
SCHLEY: What was the business model? Can you talk about the contribution of events versus movies and…?
FUTERA: So — sure, so we had a really difficult time, and getting the studios to say, “OK, we’ll give you product.” And about a month, maybe even three weeks after we had launched our service, in ’87, we began negotiations with Showtime, Tony Cox, Ron Bernard, sort of the lead negotiator, to merge with Viewer’s Choice. Viewer’s Choice had two channels.
SCHLEY: Which was Showtime’s vehicle, as you earlier explained.
FUTERA: Was their vehicle. And they realized that, if the cable guys were here and the studios were here, their opportunity was slim to none to have a business where they could make money. And we actually negotiated that for ten months. And we launched with… The only major studio we had was Columbia studios. And we had none of the other majors. And so, through our negotiations with Viewer’s Choice… Viacom owned Showtime. So Viacom cable came in. And they had a relationship with Disney, Touchstone. And so, when we did the merger, also Disney, Touchstone came in with their product, as did Imagine Films, because Showtime had exclusive with Ron Howard’s Imagine Films.
SCHLEY: So now you were starting to get some content in the pipe.
FUTERA: ATC and Warner had come together. And Warner Brothers didn’t want to get left out. So we added Disney and Warner Brothers, Ed Dwyer and his folks. We added them to the ownership of what was the new Viewer’s Choice. So we had two studios. We had five cable companies plus Viacom. And then, with conversations with Larry Wangberg and Brian Roberts, mainly through the ownership, and the CEOs of these MSOs, Comcast and Times Mirror came in. So we had eight MSOs and two motion picture studios as owners. The only real holdouts were still Paramount and MCA/Universal. We finally got Paramount. And MCA/Universal came long after I left.
SCHLEY: Why was pay-for-view…? You had such resistance that you had to overcome, as you just described. But why was — why did it matter? Why was it worth pursuing, as a category?
FUTERA: So… Well, I think there was… The one thing I love about our industry and our business is vision. So today what was Viewer’s Choice is now iN Demand.
SCHLEY: Right!
FUTERA: The vision of pay-per-view is now what iN Demand is today. Some trials with the Full Service Network, at the time… Warner… Some of the foundation of what iN Demand is today came from that trial, I’ll call it — very expensive. But the resistance for pay-per-view was, “We got to talk to our customers. And we have to be able to authorize boxes. We have to roll out addressability.” You can trap, for a big fight —
SCHLEY: Right. A one-time —
FUTERA: — a one-time big fight. So events could be strong, and big events. And if we had this network for big events, then we could take over maybe some of the business that closed circuit had.
SCHLEY: And…
FUTERA: And you could do it — you could have people stay in their home.
SCHLEY: That’s what I was getting at. It was… People forget. But to watch a boxing match, in the 1970s, generally you would go to a theater.
FUTERA: You would. And the other major player was Vince McMahon and the WWF, at the time. And wrestling was huge. And when we launched, on Thanksgiving in 1987, we launched with Royal Rumble, because we didn’t have the best, or really any, movie product. We filled it. But we did four events with the WWF and Vince, starting on that date. And it’s continued forever. Of course, then we ran into problems with him, because he felt that he built our network and so on. So we had some very interesting times with Vince and his gang.
SCHLEY: But again, parlay. You were layering on a new business, a new revenue source. And it worked, right, ultimately?
FUTERA: Well, it worked. And the other thing that the industry… And again, I give all the credit… Credit doesn’t come to me. The credit comes to these entrepreneurs and especially the privately held or controlled companies, TCI, Comcast, Newhouse, Cox, you know, Amos, with Continental. Their willingness to spend and say, “You know what? We need to spend money on addressability.” Because rolling out trucks to trap and un‑trap HBO, Showtime, Cinemax…
SCHLEY: Literally screwing in devices into…
FUTERA: You basically had to roll a truck.
SCHLEY: Yes.
FUTERA: So addressability made sense, from a back-office standpoint, just for pay. And so, if you’re going to spend the capital and the money to roll out addressability and you continue to grow your bandwidth, as more networks were becoming prevalent, in the mid‑’80s… That investment was huge. And pay-per-view was going to help to a point. I mean, the economics of pay-per-view were not huge. But why not do it, with the vision of what iN Demand is doing today and kind of what it’s done with Netflix and everything else? That’s another conversation. But these individuals who ran and owned and controlled these companies, they had the vision that went much further beyond what we were just trying to do to get pay-per-view off the ground.
SCHLEY: I think it’s an underlying theme of — you and I have talked a little bit off-camera — of a lot that has occurred. And I want to ask you about one more element of the pay-per-view category. It brought you and others into league with a colorful cast of characters, none of whom were more flamboyant than Don King, the legendary boxing promoter. You told me that he was one of the smartest guys you’d ever worked with.
FUTERA: Well, he is one of the smartest men that I’ve ever interacted with. I had a situation, when I left Viewer’s Choice to come back to Denver and get involved in M&A and corporate development at United Artist. They did have a pay-per-view company that — which was an event company, was run by a guy named Doug Stewart.
SCHLEY: Don King’s group did or —
FUTERA: No, no, no.
SCHLEY: United Artists?
FUTERA: United Artist did. So the thought was, in order to strengthen an event company… If you’re just a distributor, then you have to get the cable guys to play. And then you have to deal with the promoters. So we had a thought of taking the three large boxing promoters, Don King, Bob Arum, and Dan Duva… We knew we couldn’t sort of develop a partnership with all three, because now you’ve got an antitrust problem. But our attorney said you could bring two in. So we went out and made pitches to Don King, Bob Arum, and Dan Duva. And when I met Don King for the first time, he had just finished a press conference with Seth Abrams. They had just… They were getting ready to air the last Tyson fight, on HBO.
SCHLEY: Seth was this executive at HBO who handled sports and other licensing.
FUTERA: And he helped drive the regional sports networks. Those were also very important, from a sports standpoint, for cable. And so he was meeting — Don was meeting with Doug Stewart and I. This was his United Artist meeting.
SCHLEY: Where was your meeting? I’m just — I’m…
FUTERA: It was at his townhome, and also business, on Madison Avenue, in New York City. And we got into this discussion. And he kind of had set this up, I think. Because Don’s very smart. And Seth Abrams kept calling him about renewing and re-upping.
SCHLEY: Extending this arrangement.
FUTERA: The arrangement. And Don kept telling his admin, “Just tell Seth I’m in here with Bill Futera and Doug Stewart, United Artists, and I’m going to do a deal with them, because they’ll be fair.”
SCHLEY: (laughs)
FUTERA: So we got into this conversation and he said, “Well, don’t you think that we’re — that Mike Tyson is really the franchise that helps drive HBO? I mean, it’s live content. It’s why people subscribe to HBO. They can get video from the video stores.” And I told him that I didn’t think that that was necessarily wrong. And he said, “Well, what do you think I should do, with HBO?” I said, “I think Mike should fight for HBO for free.”
SCHLEY: You told this to Don King.
FUTERA: To Don King. And he kind of went on his little rant, and on, you know, “How could that be?” I said, “Well, look. We’ve got 2.7 million cable subscribers — United Artists. And every time that HBO pays more for content, they just pass it on to us.” And I said, “This little event company that Doug and I work for is nothing, compared to the cable business that United Artists has.” And I think some of my ability to think that way came from being around some of the best negotiators ever, Bob Miron, Amos Hostetter, Jim Robbins, even Dan Cavallo, who worked with Bob on the negotiations with the program networks, Fred Dressler. I mean, I learned so much from them.
SCHLEY: You saw them in action. You picked up —
FUTERA: I did. And I learned.
SCHLEY: — approaches.
FUTERA: And then I applied, you know, with my own thinking. So…
SCHLEY: What was the outcome of the discussion, then, with King?
FUTERA: Well, he did give me his business card and said that he thought I was very smart. Because he knew the economics of cable. How much cable made from subscription and he knew pay-per-view wasn’t that big and he gave me his business card and said, if I ever wanted to come work for him I could. It had his phone number on Long Island and where he had his place, and then his place outside of Cleveland. And so that was an interesting time. But really, for Don King and Bob Arum and Dan Duva, the idea was somewhat flawed, for putting them all together. And, you know, in retrospect, thinking of having two of those guys in the same room and trying to get them to agree on anything… Because they competed all the time.
SCHLEY: For fighters, for —
FUTERA: For fighters —
SCHLEY: — matches.
FUTERA: — and being able to promote fights and so on.
SCHLEY: Yeah. Did you ultimately, them, do a deal where you could distribute some of his events, some of his fights and those of Duva and Arum?
FUTERA: We did — the same as any other cable operator. Because it would have been putting us in as a third party. The only time we really had a chance to participate was… Mike Tyson was getting ready to fight Holyfield. I actually have a T‑shirt with the date on it and everything. But Mike had to go to prison. And it ended up being Holyfield-Douglas and may‑- and I think that’s right. It may have been Tyson-Douglas. But it was the first time that the — a fight — heavyweight fight went out to purse bid. And that’s when we got into negotiations. The cable industry was kind enough to let us lead in negotiations with Steve Wynn who had the venue and was going out and buying the rights. And so we were negotiating on behalf of the cable industry for cable’s pay-per-view. And that never worked out, because Steve wanted too big of a guarantee. And we knew we were going to play anyway. So we played anyway and did very well with the fight. And he lost a lot of money in the Mirage and he never did another fight again.
SCHLEY: Yeah. It’s interesting, though, because I think a popular perception of cable is, at least in that era, local monopolies, sort of a stodgy business, easy to understand. But you were doing all these entrepreneurial things, you — and extending the envelope, in so many different ways, you and others in the industry, advertising, pay-per-view, ultimately broadband and other add‑on services.
FUTERA: Well, again, I think… The Cable Center here has a Hall of Fame. And I walk along the Hall of Fame, on the second floor, with the pictures of these individuals. And this business was built by those individuals and their forward thinking and their ability to figure out how to finance and spend capital. The way I look at what cable has done, cable built the highway for everybody’s entertainment and now internet and so on. And they invested in that highway. But they looked beyond the dumb pipe and the highway, much beyond that. And if you also look at that timeframe, it wasn’t just Pay-Per-View Network, Inc., Home Premier Television, Viewer’s Choice, this pay-per-view network, that was a consortium of operators. You had Malone and Schneider and Robbins and Miron investing in John Hendricks’s Discovery Channel. They put money into a company called Movietime, which is now E! Entertainment. They came and helped Ted Turner with his business model. They ended up building companies called QVC… Which, you know, at some point in time, they were getting equity in some of these companies.
SCHLEY: I remember that.
FUTERA: Because they weren’t dumb. But they also helped the proliferation of programming, through networks. This was before, you know, sort of, you know, all of the things that are going on today.
SCHLEY: Absolutely, by investing in them, by…
FUTERA: But they built the highways. And every time there was more demand for content, they spent the money to expand the highways. And they knew what they were doing, when they did it. And it’s a phenomenal story. And I don’t know if their legacy will ever be appreciated to the extent that it should be.
SCHLEY: When you were living it, when you were there in the room, did you sense that there was such a transformational set of decisions going on? Or was it…? You know, so it’s easy to get lost in the weeds around the minutia of business. But did you have a feel for what these people were doing?
FUTERA: Again, I had the good fortune of being in meetings with these individuals. They also were negotiating for the rights for NFL Network, on Sunday night. These individuals were together fighting the wars and presenting themselves in Washington, DC, with the FCC — and the way they were being looked at. But they all talked to each other. And it was… And this — they didn’t just talk to each other in the meetings. What you knew happened is — what was going to happen at these meetings. Bob Miron had already had a conversation with Dr. Malone or with Jim Robbins or with Amos. These individuals worked together and shared their thoughts and where they were going and sort of the — where they thought the roadmap might be for the industry. I was — I had the good fortune… It was like going and watching great Super Bowl performances when I wasn’t really playing at the level. I had a chance to participate in some of the development and some of the thought but the real thought was — is represented, again, as you walk along the second floor here.
SCHLEY: And, you know, Bill, one of those individuals, and you’ve mentioned his name a number of times, is Bob Miron. Can you talk about your different…?
FUTERA: Well, Bob Miron is really a father figure to me. I pretty much lost my parents when I was 19, early twenties. So as I was able to go through the industry… When I met Bob Miron… Bob isn’t a big man, but he’s a big man. Because everybody listens to Bob. Bob was there for Discovery, you know. Bob was there for our Pay-Per-View Network. Bob was there for Movietime. Bob was also there for Think Entertainment, for Shelley Duvall, which basically tanked. But Bob was the consummate innovator, in my opinion, he and probably [John] Malone and, eventually, Brian [Roberts]– and there are others. But what was so special about Bob, you worked for a private company, the Newhouse family, who I got to know. Thirty-one of my 35 years in cable have either been directly involved with Bob, and the Newhouses. And I think the greatest testament that I can say about Bob, as it relates to the industry, is I’ve been to many Hall of Fame dinners, where these individuals were inducted into the Hall of Fame, and there was never one that I attended, over 15, 20 years, where at least one, a minimum of one, did not thank Bob Miron in their speech.
SCHLEY: It’s…
FUTERA: Because Bob Miron was there for everyone, at any time they needed him. And it was interesting, as you see the different individuals, whether it’s an Ann Carlsen — who is also a great industry leader, [and?] what she does — thanking Bob Miron for his support. And people didn’t… Bob was not threatening. He was a son of a gun to negotiate with. And he did have opinions, and darn good ones. But he was somebody that people trusted, because he was not working for a publicly traded company. They knew, when he first suggested to avoid regulation, in the ’80s, that they ought to have customer service standards, on answering phones and service calls and installations. Bob is really, in my view, the father of premier customer service. Robbins and Cox probably followed — or a fast follower there. But Bob was all about the customer. You know, when we got regulated, in Albany, New York, our rates were $20 for broadcast basic and CPST. And Time Warner, Time Inc.’s cable, they were $27. We each had to take a 10% haircut. And why were we so low? Because we believed in high penetrations. We were 80-some percent penetrated in the Albany market, in the systems that we had. And we always believed in high penetrations, reasonable pricing. When we put together our partnership with Time Warner, it wasn’t all of Time Warner’s cable systems. It was about half. And our budget meetings were very interesting, because we discussed what the rate increases would be for the Time Warner, Advance/Newhouse partnership cable operations. And Bob always fought for the customer, knowing that high pricing would ultimately push people in another direction. We had competition, at the time. And he was so spot right on. And so it’s — for Bob, it’s all about the customer, always there for anyone in the industry, to support. I think he was the first one to be put in the chairmanship of the NCTA a second time.
And the other thing is I know personal stories of individuals that, he looked after them and their families. And two of them you may be familiar with is Fred Dressler, who we lost at too young of an age, right after he retired — and the same with Marc Lustgarten, who passed away way, way too early — and Peter Barton. You know, those individuals, Bob was there not only for them but, when they passed, he was there for their families. He’s a remarkable human being.
SCHLEY: The three people you just named, Fred Dressler, sort of a legendary program negotiator, ended his career… Was it with Time Warner?
FUTERA: Yeah. He was with ATC. He did franchising, to start out with. Fought those wars. And then he ran Mile Hi Cablevision. It was really — outside of New York City and Manhattan Cable Television, it was the first real metro area that ATC built out. So Fred ran that for a while and then they put him in charge of all the programming negotiations. And the programmers were proliferating. And he sat on boards and… Again, a very good friend, mentor of Bill Futera and his family. And we lost him way, way too early.
SCHLEY: Marc Lustgarten I associate with Rainbow. Was that correct?
FUTERA: So Marc was one of Chuck Dolan’s right-hand guys. And I didn’t really know Marc. I knew of him. And he did programming. He was involved with Rainbow. Because it was all content-based. And his reputation was very strong, very good. If you work for Chuck and he brings you into Chuck’s inner circle, you know that he was special. And Bob knew him well. And…
SCHLEY: And then the third individual you mentioned who — whose life had been touched by Bob Miron was the late Peter Barton, who I did know. And he was here in Denver with TCI, I think for all of his cable career and then with Liberty.
FUTERA: It’s a great story.
SCHLEY: I just wanted to explain those guys. And as a business journalist, it was interesting, because none of us knew Bob Miron that well as a source for information or as an interviewee. He did not aspire to a high public profile.
FUTERA: Well, the one thing that I loved, working for the Newhouse family and working for Bob and then for his son, Steve and his daughter Nomi. Their philosophy was talk to the people that make a difference in the business. You only need to talk to people who make a difference in the business. Our — a privately held company, our financials were never really seen. They were embedded in the Time Warner financial statements. But we only owned a third of the partnership. So our financial statements were never really public. So Bob used his time talking to other people in the industry, talking to people in Washington. Press was not a big thing for us. We had — there was no value — unless… And we started to loosen up a little bit. Because when you’re in competition, real competition, for the commercial side of the business, you want to announce that big deal that you made with a regional bank.
SCHLEY: A school district‑- a hospital.
FUTERA: School districts. Exactly. So we would… And if, let’s say we did a deal with Cisco and we were rolling out new technology for a commercial customer.
SCHLEY: You want to get the word out.
FUTERA: We wanted to get the word out. Because it benefitted our business. But unless it benefits, what does it matter? And Bob Miron, who deserves as many accolades as anyone in the business… And not because I work for him and I was close to him. I think, actually, I can say, because I was, and he wasn’t really public. He’s the kind of guy that just always focused on the business. That’s why everybody trusted him. He was self-serving about the business. No public people to worry about.
SCHLEY: Talking to you, you have obvious reverence for a lot of individuals. You lost your parents at an early age. And I’m sure — and I don’t want to be trite about it, but your family sort of was the cable industry or some of the people that were involved in the cable industry.
FUTERA: Well, in many ways it was. And I think one of the things — it was easy to move away from Denver, to pursue a career away from Denver… Because I love Denver. I’m back here. I’m retired. Was that I didn’t have a huge family commitment. The person I admire most in the world is my wife Cheryl, who, basically, her whole family has been in this area. She was born in Wyoming and…
SCHLEY: Is a Westerner. Yeah.
FUTERA: In fact, her whole family has been here forever. And she left her parents, her siblings, nieces, and nephews to allow me to chase sort of my passion. Once I got the bug and I got the passion, I never wanted to leave it, ever.
SCHLEY: Can you even imagine…? I mean, you sort of found the cable industry or it found you in a very happenstance manner. You didn’t ordain this career. You walked across the street and had a job interview and, 35 years later, here we are. But…
FUTERA: I really did not — I never in my wildest dreams… I knew what cable was. I remember going and watching Danny Ainge win an NCAA basketball game at a bar.
SCHLEY: They had cable on the screen?
FUTERA: Because they had cable. Mile Hi Cable was just somebody’s dream. So I had to go watch that. But I knew it was ESPN. And as I started to see the — as a consumer, what could happen with it… And then again, I was blessed to be in the right place at the right time, to have exposure to the Hall of Fame, basically. Remarkable.
SCHLEY: I wanted to touch on one more subject before we sort of wrap things up. But you talked about competition, briefly. And when — in ’84, when DirecTV launched, and thereafter, this industry has been buffeted by competition from all sides, and even in the past, with the broadcast television industry and fights from the telcos, has faced pressures from the outside environment. But how did competition, the dawning of the satellite era, later the entry of telephone companies, influence or affect the way this industry performed or behaved or went about its business?
FUTERA: Well, I think, when the satellite companies launched, cable industry put together this — collectively, put this little company together called PrimeStar. We basically told Washington that this was an inexpensive way for us to expand our plant.
SCHLEY: PrimeStar itself was a satellite video distributor.
FUTERA: Satellite video distributor like DirecTV and Charlie’s Dish Networks. Well, that didn’t go over too well with Washington. They felt… Because we only were going to be able to build out in the wide areas. And it also was sort of an antiquated plan. But again, you had Malone and the wonderful John Sie.
SCHLEY: Backing this idea.
FUTERA: Sort of leading… Actually, John was our CEO for a while, until we hired someone. So the thought was we can compete everywhere. So we’re getting ready to compete everywhere. So we basically had to sell off PrimeStar. From a satellite standpoint, the only real competition that we felt that was serious — because people had to put dishes and stuff on their house was the exclusivity of the NFL Sunday Ticket.
SCHLEY: To DirecTV?
FUTERA: And so that was a challenge. But we were always up to the challenge. The other thing is, as we started to move more towards two-way… Two-way, for the satellite companies, was dial-up phone.
SCHLEY: A lot of distance between us and the satellite.
FUTERA: And so, when we really launched our internet service — and for us at Time Warner, Advance/Newhouse, and our partnership, Road Runner, in the mid‑’90s, we knew it was going to be a challenge for the satellite networks to be able to provide internet. Doesn’t mean they couldn’t find a way. Because we never put our hat on and said, “We’re going to be a monopoly.” These individuals who built and run this industry, they’re too smart to think that, when they have a good thing going… But the launch of the internet was extremely important. And if you look at it… And people used to say to me, “Oh,” you know, “what about these new services, and Netflix and…?” —
SCHLEY: That are going to ride over the —
FUTERA: “And what are you guys going to do?”
SCHLEY: The highway you’re creating.
FUTERA: I said, “The good news is we play. Because we built the highway.” These companies, including Google, Amazon -‑ any of these companies who develop these apps, they ride on our network, that we invested in. They ride for free, most of them. Little, not real comfortable feeling. But they do. And what do we like about it? Is it providing the consumer with what they want. So we get to play, in a business where we have competition. We’ve seen — the ESPN subscriber losses have been enormous.
SCHLEY: Right — of late.
FUTERA: Of late. And we’ve fought with the phone companies, as well. But they had to… So Verizon had come in and built fiber. That was their plan — which they’ve —
SCHLEY: With the Fios broadcast.
FUTERA: Which they’ve recently stopped. And we were actually the first Fios market, in Tampa. We were the first.
SCHLEY: With Bright House.
FUTERA: Yes, and so we had to fight. And we fought with all the right things, price, customer service, and performance.
SCHLEY: The network speed.
FUTERA: Yes, and those are the critical things. The customer takes for granted that your network is going to be on 24/7, with all the speed that you need. But we couldn’t be happier. I mean, you can… I don’t know Brian Roberts. I know Tom Rutledge. When you have a conversation with Tom Rutledge, he loves this over-the-top because he gets to play. And all it does is provide the marketplace, they consume with what they want.
SCHLEY: I mean, in a way, from an abstract perspective, it’s an extension of the same sort of thinking that prevailed when you launched pay-per-view or started the ad sales business. It’s a new opportunity that flows from the existing platform.
FUTERA: Well, and I think that’s very much the case. And also, if you just use Netflix as an example, Netflix is content. And they’re producing some of their own content. Because they know that that’s important. Our cable nets learn that. But with these models, these new content models, like a Netflix, Amazon, these models actually allow our customers more choice than us having to negotiate deals with a program network —
SCHLEY: It’s an interesting way to look at it.
FUTERA: — like ESPN, who says, “Well, you are going to pay for 90% penetration, whether you have it or not.” So some of the pressure of all the cost of content, which we basically don’t make any money on anymore…
SCHLEY: Yes, video’s…
FUTERA: We’re happy that there are these other models, because the consumer says, “I got to get my cable modem, to get what I want.” And then, when they have an opportunity to see what Xfinity does today, beyond Netflix, with on-demand offerings, DVRs — that Comcast — and where Rutledge is taking Charter and where Cox is now… And they’re embracing Xfinity now, as well.
SCHLEY: Understood. So you don’t look at it as an us-or-them, either/or kind of proposition. This is a new way to deliver more of what customers want, over the platform, if you look at Netflix or if you look at YouTube TV or any of the new providers that are out there.
FUTERA: Well, and that’s exactly right. I use a lot of sports analogies in my life. And if you get to play in the game… You always have an opposition on the other side of the field. And you have to figure out how to play in that game with them. That’s how I view the business. So it’s extremely exciting where it is today. I think there’s been a lot of consolidation. I think that, with a Roberts‑ and a Rutledge‑, Bickham‑- sort of -‑led big cable companies, what’s going to be interesting is what are the succession plans for those individuals…
SCHLEY: I actually wanted to ask you about that. I mean, will that vision and that entrepreneurial spirit find ways to carry on, as the structure of the industry changes, as there are fewer companies, bigger companies, more competition? Do you see a danger of that not continuing?
FUTERA: I really don’t. I think the biggest danger that sits out there that Brian and Tom have to worry about all the time, is Washington.
SCHLEY: OK. Which is not new, right?
FUTERA: Well, it’s not. It’s been new with the kind of money that Google and Apple and those companies who ride our networks for free can spend on lobbying. You know, our transaction with Charter was extended, because the FCC spent so much time… So you’re dealing with not only the FCC but these local governments. And obviously, if Commissioner Pai would have been there, I would have retired earlier.
SCHLEY: (laughs) Right, faster —
FUTERA: And so… And I’m not sure whether the current administration will exist, four years from now. And it could flip the other way. So I think that’s their biggest challenge. But again, why do they get to play? It’s like anyone who owns real estate. If you own the real estate in prime locations, which we do, then you get to play.
SCHLEY: You’re in the game.
FUTERA: And you have the asset. The competitive LECs, [Local exchange carriers] which was sort of the alternative phone companies —
SCHLEY: The phone company competitors. Right.
FUTERA: — most of them file bankruptcy.
SCHLEY: — are gone.
FUTERA: One didn’t. And that was — it was Time Warner telecom — and it was TW Telecom. Level 3 bought them. And I think — and CenturyLink, I think, just is buying Level 3.
SCHLEY: That’s right.
FUTERA: But why did they survive and not file bankruptcy? Because they were facilities-based. So the asset is there.
SCHLEY: Owning the network puts you in the game.
FUTERA: But you have to manage your asset! You’ve got to have the bandwidth. And then what you have to have, if you’re going to stay in the video business — is you have to go from, you know, Xfinity 1 to Xfinity 2. You have to continue to build. And Comcast’s investment and the people that they have in Silicon Valley is… In my opinion, they’ll always be around. The other challenge that Comcast and Charter have is each other.
SCHLEY: Yeah. It’s an interesting wrinkle. Right.
FUTERA: It could happen. But for now, I’m not really ready to speculate on that.
SCHLEY: You’re doing something interesting. You’re writing a memoir or a personal history, that you’re sharing with your family? Is that correct?
FUTERA: I am. There’s really two pieces of it. There’s sort of the personal side, and losing my parents and what I went through personally and the — being in the right place at the right time. I met my wife at ATC.
SCHLEY: Oh, is that right?
FUTERA: I did — and so… That, to me, is the most important one. But I also am writing it for my family about my career in the industry and, actually, even my career before then, here in Denver. I was very fortunate to work for some great people, who taught me more than I could have ever learned academically.
SCHLEY: At a young age.
FUTERA: And… At a young age. But it’s for them. And I’m looking forward to sharing that with them. And I keep adding pieces to it, here and there.
SCHLEY: Well, there’s a lot to recount. When they’ve closed the final page, what will their impression be of your work — your body of work in the cable business? I mean, what are you trying to convey about that huge part of your life that was meaningful to you?
FUTERA: So I think, when I was in the right place at the right time, I had an opportunity to perform. Again, I’m a big football analogy guy. Terrell Davis almost took a flight home and never played in the NFL, until he made a spectacular play in Tokyo, on a kickoff return — or he never would have played one down for Denver. He was ready to quit. So when you’re in the right place at the right time, whether — young people that I mentor today including my own family members… It’s all about when you are in the right place at the right time that you need to perform.
SCHLEY: What do you do with it?
FUTERA: And what you learn from being around people like a Bob Miron is, don’t be anybody who you’re not. Be who you are. When something goes wrong, your fault, not your fault, whatever, get it out there.
SCHLEY: That’s great advice.
FUTERA: And what you do is you build trust. So even though I performed, the honesty and the trust that you can build, those are assets that you can grow with. And that’s the good fortune that I’ve had in my career. And I hope that my children will work hard, will perform. And you perform hard all the time, because you never know when people who can make a difference in your life are watching. The work ethic, you need to have it. I believe all my children have it. And I think that those are important values. And if you’re intuitively smart and bright, you can do anything. I mean, I’m sure Jim Chiddix did not grow up being this super-intelligent engineer. But Jim was inherently smart, listened, and took the time to go beyond just what he had to do. He was always looking ahead.
SCHLEY: I think that notion about authenticity is a huge point and an appropriate end note for us. This has been one of the most enjoyable interviews I’ve ever done. So thank you. Talk about right place, right time. We are in the right place at the right time for the ability to recount a rich history with Bill Futera. So thank you, very much. And for The Cable Center, I’m Stewart Schley.
