Word: righting
(lookup in dictionary)
(lookup stats)
Dates: during 2000-2000
Sort By: most recent first
(reverse)
...Warner was providing 80% of the cash flow. Says Levin: "If some people think that AOL has been sold at too much of a discount or Time Warner has been sold at not a high enough premium--if we get those disparate reactions--then we've probably done the right thing." Although both companies have done handsprings to portray the combination as a merger of equals, Wall Street has since made it clear that it considers AOL more equal than Time Warner...
Obvious as all this success seemed to Case--everyone was going to get online, right?--it was still a hard sell everywhere from Wall Street to, at times, his own boardroom. AOL spent more than $1 billion building its system. From a historical perspective this wasn't aberrant; communications networks always swam deeply in the red before emerging into profit. It was those insane costs that prompted the U.S. government to give Ma Bell her monopoly. But no one was giving Case a monopoly over anything. He'd have to fight for every cent...
Levin's conversion to the wired future came in 1975, although the wires were different then. He was working for a marginal Time Inc. division called Home Box Office. The HBO idea--to zap movies right into the living rooms of average Americans--was simple, easy to understand and almost universally regarded as nuts. This was particularly true since HBO was incinerating money. Levin knew he had to gamble, and in a move that foreshadowed a liking for big deals, he persuaded Time Inc.'s conservative board to burn another $7.5 million for a slot on the very first communications...
...idea turned out to be right. Overnight, HBO went from cash incinerator to cash machine. The movie channel became a dominant force in the entertainment business, leading a young Paramount executive named Barry Diller to moan in 1983 that "if HBO and Time Inc. go unchecked, the motion-picture industry will be under total control of one company in less than five years." But even more important, it showed that consumers were willing to pay to subscribe for something that had always been given away free. Around the nation, small cable operators raced to copy Levin's idea. In Atlanta...
...foresaw no antitrust problems, even though the $165 billion takeover is the biggest in history. "This thing is instantly available everywhere...so it's my view that this is kind of a clean break with the past," said Levin. "I don't see a regulatory problem." He is undoubtedly right as a predictor of government (in)action. Which is to say the takeover will probably be the beneficiary of the Robert Bork-Chicago School efficiency theory of antitrust, which bloomed with Reagan and his deregulators...