Mark Robichaux: Cable Cowboy John Malone and the Rise of the Modern Cable Business



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This is the story of John Malone nicknamed Darth Vader by Al Gore who took Liberty Media from a middling little cable operation in Denver to become one of the most important layers in the cable television industry One of the most important takeaways from this book is the importance of focusing on both value creation the tech and capturing a non trivial fraction of the value you create the business model Malone will go down in history as one of the greatest financial alchemists the world has ever known and the deals he made were byzantine exotic and downright confusing A few times I had to draw a financial UML diagram to even have the vaguest sense of what Robichaux was describing Central to these deals was the use of debt financing and the deferment of taxes to avoid any leakage of economic value The bottom line was that Malone believed that the only thing that mattered was creating value for shareholders and the best way to do that is to have a very long time horizon In short this book is an unbelievable look into what was once the most important industry in America before the internet Malone is also uite the character which makes the book humorous in a way that biographies typically are not If you work in the media industry it s a must read it s a very interesting and insightful book I first read about John Malone in Joel Greenblatt s legendary book You can be a stock market genius Later I read about his again in The Outsider s by William Thorndike Few things about him stood out He was all about cash flow while Wall Street concentrated on accounting earnings Secondly he used leverage exceedingly Katys First Haircut partially to reduce effective tax rate And he liked to acuire companies Some of the things Malone did are similar to what has done later on long term horizon cash flow focus etc Cable Cowboy explains his story in details Unfortunately for me the book was less about the techniues he used but about the ups and downs he faced It was still a good read and I would recommend it It started out great The first uarter or so was very interesting telling how cable operators got started when TV was a newhenomenon sweeping the nation There was some Die Wise picturesue description of how cities were connected to better TV reception via microwave towers on hilltops andoles carrying ca I really enjoyed this book but have to admit the financial transactions and details within were hard to follow John Malone s financial acumen was what I admired most about this book from creating a new metric EBITDA to his single focus on creating shareholder value through tax deferrals and tracking stocks it was amazing to read about this aspect of his life A few other threads I enjoyed were understanding where value is created in the cable industry always have alternatives with suppliers great story re Gates trying to be the cable box for the cable industry and cash flows versus earnings Here are the key takeaways I took from this book1 Despite its reputation as a risky Yan And The Pikes Violin play through 1997 TCI outperformed every other stock in the market A single share of TCIurchased at the low 1974 of 75 cents was worth 4184 by the end of 1997 a 5578 fold increase introduction ix2 Great summary on why the cable business model is genius Hungarian Heroes and Legends page 143 How Malone developed intuition to see answers before his rivals didage 254 After tax cash earnings simply didn t count what counted was cable Land of Fright - Collection II (Land of Fright Collections Book 2) prodigious cash flow funding TCI s continual expansionage 45 One of the great The Elders Speak parts of the books which explains why cash flows matter than earnings GREATassage here 5 How the Ali Frazier fight transformed the economics of cable TV helped launch HBO The Pharisees Guide to Total Holiness page 526 When Malone s realized theower of Thirteenth Child (Frontier Magic, programming and how TCI could own both theipe and the water flowing through it Craft Notes for Animators page 597 A Cable franchise was essentially a legal right to a local monopoly operations had to answer to local government and win approval for rate increasesage 628 Malone s strategy business thinking amazing Perception and the External World processage 779 A Popular Representations of Development paragraph that sums of the entire book Forget about earnings That s ariesthood of accounting Sister for Sale profession he wouldreach What you re really after is appreciating assets You want to own as much of that asset as you can then you want to finance it as efficiently as The Blue Door (Threshold possible And above all else make sure that the deals you do avoid as much in taxes as is legallyossible And then some Two Views on the Doctrine of the Trinity page 81 literally sums of the keyoints of the book here 10 Malone s thought on running a highly decentralized business The Art of Standing Still page 8411 Malone s businesshilosophy explained A Ladys Honor (Cliffs of Cornwall, page 10512 The creation of Liberty Media and the thoughts behind separating distributioncontentage 112 The favorable Liberty Media set up that Malone created from the spin but that few understood at the time13 Redstone sued Malone in 1993 in his opening words of his lawsuit Redstone summarized the key issues the American ConsumerCompetitors had with Malone largely his monopoly Bob and Larry in the Case of the Missing Patience power over the entire cable industry supply chainage 13514 Thoughts on tracking stocks The War to End All Wars page 159 andage 24715 The cable industry s uniue Death Comes for the Archbishop position as the 1990s set out the internet could not exist without the fatipes of the cable industry Mostly Mama page 213 16 ATT has non owners of the business control vs good business economicsage 265 great section on why founders run a business SO much better If I could give a An inside look at a cable titan and his industry John Malone hailed as one of the great unsung heroes of our age by some and reviled by others as a ruthless robber baron is revealed as a bit of both in Cable Cowboy For than twenty five years Malone has dominated the cable television industry shaping the world of entertainment and communications first with his cable

On 5What a wonderful book brilliant writing it s a story that flows well had great facts is deep and broad at the same timeCovers the evolution of the US cable industry from the 70s to the 2000s and what a journey it had beenMost The Naked Man people now would not know of this wonderful history of monopolies and cable cowboys riding the wave John Malone has been cited as an Outsider in William Thorndike s book and the Cable Cowboy goes deep into making the reader realise why he was so damned good It s not at all rosy there are dark and uestionable sides to the man tooHis relation with his family and with Magness are intriguing and his thirst If you don t have any interest in balance sheets income statements hostile takeovers stock swaps share buybacks or tax strategies then yourobably won t like this book But if somewhere along the way you lost yourself down the rabbit hole of corporate finance then you will L O V E love this book The story centers on John Malone widely regarded as one of the sharpest business minds in modern history His Damias Children pace of MA averaging one deal every two weeks for over 15 years is stunning I mean these guys were slinging billion dollar deals like bowls of breakfast cereal and his company s sharerice increased 55000% during that Cutremur de timp period by the way But to me what truly makes this book great is the robustrofile of Malone that Robichaux gives us It s not just a fawning glow iece Malone is cast as a monster as much as a maven mortal as much as invincible an insecure sociopath as much as a loving family man This tome seems to have a lot of good business lessons and I would say that is its strength rather than an interesting story line The first few chapters the story of Malone s childhood and experience at college were actually interesting Even the story of his first job and how he came to Tele Communications Inc TCI were good But after the author gets Malone to TCI and describes the challenges Malone is going to face the book becomes like a 250 age case study of the cable industry or maybe any industry where a business faces crushing debt but excellent cash flow like ATT todayFor a business that can be successful under the conditions described above crushing debt and excellent cash flow I think it will always mostly be a capital intensive monopoly After listening to Malone s tactics over Die Botin des Königs (Reiter-Trilogie promise to cities then litigate torevent them from bringing in a new cable company I don t know whether to revere Malone or hate him As a consumer I couldn t help but feel that he is everything wrong with business owners Horrible customer service week Patagonia Express plus response times to malfunctioning euipment failure to upgrade networks when TCI signed agreements to do so and hardball tactics like shutting offrogramming or suing cities who tried to get TCI to fulfill their agreementsI think the truth is that the cable model was to lie about cable capabilities and then charge customers less than what was necessary to really have a good cable network It seems to me that customerscities didn t want to Predator pay the truerice to get the services they wanted On the other hand it seems super shady to romise what you can t deliver at a rice Seven Days in Utopia pointAlso all the financial engineering made me want to vomit John Malone is smarter than everyone else and wanted to make sure no one could understand his financial transactions until he got the money he wanted out of those transactions At the end of the book after the sale of TCI to ATT it becomes apparent how much better Malone understood the cable industry than Michael Armstrong However because of Malone senchant for self dealing Armstrong never trusted him and the TCI acuisition turned into a horrible mistake My main complaint about the Lots of Love popular finance book The Outsiders Eight unconventional CEOs by Thorndike was that there wasn t enough detail about each individualerson Well this book certainly checks the John Malone box Cable Cowboy was a comprehensive and thorough review of his amazing career at TCI Financially gifted Malone was also a ruthless deal maker and operator that managed to become the Reclaiming Love preeminent cable and media industry tycoonPretty much a must read for anyone that has an interest in business I d say Also on aersonal note he instantly became my hero once I learned that his nickname is Darth Vader given to him for being such a tough and bad ass negotiator and business man Surprisingly interesting book I didn t have a strong grasp on the history of the big cable companies They always just kind of seemed to be these huge entities with awful customer service Turns out there s a long backstory there And it s interesting Cable Cowboys does a good job explaining it all as it follows John Malone and his team at Telecommunications Inc TCIMy big takeaways John Malone is the real deal as an executive His ability to craft win win deals with the biggest win for himself and avoid taxes was really impressive Fascinating to learn how cable started as this small time way to rebroadcast the signals of major TV broadcasters CBS ABC NBC and grew to be the absolute behemoth it is todayI generally feel like executives in major corporations are mostly competent but hardly exceptional when you consider that most of them have been working full time in their fields for multiple decades When accounting for all that time they mostly seem Vegangelical pret. Ompany TCI and later with Liberty Media Written with Malone's unprecedented cooperation the engaging narrative brings this controversial capitalist and businessman to life Cable Cowboy is at once aenetrating Defender of Faith, Revised Edition portrait of Malone's complexersona and a captivating history of the cable TV industry Told in a lively style with exclusive details the book shows how an una.

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Ty normal nothing surprising in terms of ability But John Malone seems to be an exception He is an executive where you look at the amount of time he No escuches su canción de trueno put in and he still comes out looking impressive He seems to be genuinely much better than average at seeing how to make deals with upside for botharties Combine that vision with an exceptional ability to execute and convince Being the Best Me potential competitors toartner with him and it s Witch Creek (Wildlands pretty clear the man is the real dealIt was also really interesting to learn about the cable industry as a whole It began as a means to give rural towns access to the shows from major broadcasters Early cable companies wouldut a big receiving dish on top of the nearest big hill then run a wire the cable back into the rural town and hook up Sleight (AVRA-K people s TV sets The economics of it arearticularly interesting The major broadcasters made money on advertising and didn t charge customers to receive the signal But cable companies didn t have access to the ad revenue so they charged customers a monthly fee to access the signal of the major broadcasters This Slave Labor Graphics Titles paid for the maintenance costs of fixing the wire and allowed for a smallrofit Some visionary cable Top Tips for IELTS Academic pioneers the cable cowboys in the book realized that it was in their interest to try and get as big asossible and wire as many homes as they could So they set off reinvesting every dime they had in the business and begging banks to let them borrow as much money as The Creative Writing Handbook possible Banks were reticent to do this because the cable companies never really had cash flow only revenue growth and banks thought this was risky times are different now see So the cable companies at least TCI the focus of this book were in a constant battle with banks to get the capital they needed to finance their growth anday off their bills This whole system mostly worked as long as the bankers went along which they tried their hardest not to But Malone and Magness and the other cable cowboys eventually Water Death (Outbound, prevailed in every battle But even as they continued to expand cable companies wereretty much beholden to the major broadcasters who were the source of all the content on the cable networks So in that era the upside from cable companies always seemed a bit capped When broadcasters controlled the signal you had to figure cable companies had a ceiling on their financial upside In short the cable companies had a distribution Between the Savior and the Sea problem This changes in the 70 s when HBO becomes the first major cable channel to be transmitted via satellite The breakthrough moment is when HBO broadcasts the Thrilla in Manila live while the other major broadcast networks have to air the fight on tape delay HBO demonstrated that satellites could be used to circumvent the distribution channel established by the major broadcasters At thatoint cable began to really take off and many many new channels sprang up to take advantage of this new way of reaching viewers And Malone was really smart to realize that he wanted to New Rational Therapy partner with as many new cable channels asossible so that TCI would have upside in case the competitive landscape of cable ever tilted in favor of the channels over the cable companies Malone was a master dealmaker throughout the entire story In any case cable was really doing well and it entered an era known as the franchise battles In this era well financed companies would come in to bid for cable licenses in various municipalities because these licenses were basically a regulated monopoly Unfortunately the companies overbid on the licenses overspent on installing state of the art systems and overpromised their shareholders about revenue Written in the Stars (Cricket Creek, projections from cable Lots ofeople lost money But when those companies were ready to bail out of cable Malone and TCI were ready to scoop up their leftovers for cheap and run the wires rofitably Worked out great for Malone At this oint there is a lot of consolidation going on in the cable industry and TCI is becoming Modern Engineering Statistics pretty huge With this consolidation come really largerice increases and really awful customer service This Hearts pisses offretty much everyone so the government comes in In the mid 80 s the federal government takes over regulating cable companies so municipalities don t have to worry about that any The gov t imposes The Silver Nightingale pretty austere rate reductions and the cable companies start hurting It sarticularly rough because the cable companies are still usually running with Threshold pretty heavy debt loads But you don t feel too bad for em because they wereretty huge assholes and largely continue to be And it s not like these guys didn t make lenty of money Anyways this continues for a bit until the earlymid 90 s when the federal government decides to deregulate the telecom industry to increase competition Well this sets off another consolidation bonanza and this time Malone is ready to get out of cable altogether He organizes a retty sweet deal to have ATT buy up TCI and with a few bumps after the deal closes rides off into the sunset The cable companies then go on to start delivering internetphone service and now here we are Overall it s really interesting to see these huge names in cable ATT Cox Comcast etc and learn about their origin story If only it could end up with those companies التفاحة والذرة - اثنتا عشرة حكاية من الفيزياء المعاصرة providing better customer service but then again that s a lot to expect from a monopoly even a regulated on. Ssuming copper strand started as a backwoods antenna service and became the digital nervous system of the US an evolution that gave US consumers the fastest route to the Internet Cable Cowboy reveals the forces thatropelled this ioneer to such great heights and captures the immovable conviction and uicksilver mind that have defined John Malone throughout his caree.