Call Me Ted (25 page)
In difficult situations like this, I try to be as straightforward as possible. I made it clear that I agreed that our manager had been in the wrong and as president of the company I took responsibility for his lousy judgment. I apologized for this behavior but explained that if they went forward with this suit, they wouldn’t be punishing him; they’d only be hurting my company.
At one point in the negotiations I actually got down on the floor on my hands and knees and begged for forgiveness. I clasped my hands together and said, “You gotta let me sell this station or I’m a goner!” Somehow, between Hank Aaron’s support and my demonstration of genuine contrition, we got the negotiations back on track and worked out a deal. They would drop the lawsuit if I agreed to make a certain level of donations to the United Negro College Fund and some other worthy causes that they supported. With the lawsuit resolved, our license transfer was approved, and we completed our $20 million sale of WRET.
We were now just weeks away from CNN’s debut. Practice and preliminary trials for the 1980 America’s Cup had begun in Newport so my schedule was tight, but I wanted to be sure we put together a noteworthy launch that would let the world know that the Cable News Network was going to be something really important. We decided to hold a ceremony in front of our new offices—out on the lawn of the old Progressive Club. In addition to our own employees, we invited advertisers, cable operators, and members of the press. The network would begin satellite transmission at 6:00
P.M.
, so our event was scheduled to begin around 5:30. I flew down to Atlanta from Newport that morning.
We invited a combined Armed Forces Band, with top-notch musicians from the Army, Navy, Air Force, and Marines. They arrived a few hours early, as we were assembling bleachers and the viewing stand. While they were rehearsing, I asked them to play “Nearer My God, to Thee,” which I read was the last song played on the
Titanic
when she went down. We taped the performance so that in case the Cold War ever got hot and nuclear weapons were being launched, CNN could sign off its final broadcast with the Armed Forces Band and this recording. These were young service people and when they played this beautiful melody I had tears in my eyes. (By the way, as I understand it, this tape remains in CNN’s library—but thankfully they’ve never had to air it!)
Once our guests arrived I kicked off the program with a few comments, then handed the stage over to our other speakers. In addition to Reese and other Turner executives, I invited NCTA president Tom Wheeler to say a few words to emphasize how important this new network was to the cable industry. When it came back to my turn, I discussed the important role I expected CNN to play in disseminating information and bringing people together. Finally, I read this statement, which had been prepared by our PR department:
To act upon one’s convictions while others wait,
To create a positive force in a world where cynics abound,
To provide information to people when it wasn’t available before,
To offer those who want it a choice:
For the American people, whose thirst for understanding and a better life has made this venture possible;
For the cable industry, whose pioneering spirit caused this great step forward in communication;
And for those employees of Turner Broadcasting, whose total commitment to their company has brought us together today,
I dedicate the News Channel for America—The Cable News Network.
Then the band played the National Anthem, as was the custom for television stations when they signed on and off each day, and CNN went on the air. It was a thrilling moment. We still had a lot of work to do to make CNN a success, but we had already cleared substantial hurdles and had defied numerous skeptics simply by getting on the air. As proud as I was and as much as I would have loved to stay for the entire reception, I had to leave a little early to catch my flight back to Newport and the America’s Cup trials.
A Dagger Pointed at Our Heart
I
decided to pursue the 1980 America’s Cup with the same boat and largely the same crew we won with in 1977. With
Courageous
also taking the prize in 1974 we were asking her to win three cups in a row, a feat that had never occurred. Our competitors now had had six years to study her design and to use this information and the latest technologies to build a faster boat. I could have tried to build a new one as well but designing and building a twelve-meter yacht takes a lot of time, energy, and cash, and given everything else I had had going on, especially getting CNN off the ground, I just couldn’t do it.
Our prime competitor in the U.S. trials was Dennis Conner, my former crewmember and eventual rival in 1974. After skipping the 1977 event, Conner was now putting a tremendous amount of energy and resources into his 1980 campaign. In addition to financing and building a new boat—
Freedom
—he had hired Robbie Doyle to help with
Freedom
’s sails. Robbie was on our crew and made our sails in 1977 and was doing the same in 1980. The competition in 1977 could only guess about what sails we had and how to beat them, but with Doyle on two teams in 1980, Conner knew exactly what we were using and had the time and resources to make improvements. It was as if, before World War II, the British had a Messerschmitt 109 or the Germans got the Spitfire and they had three years to test their own planes against them. Dennis also spent a lot of time sailing and practicing with his team. In the twelve months leading up to the trials, he was on the water over three hundred days to our seventy. America’s Cup yacht racing was becoming a full-time sport and it was getting much more difficult to compete as an amateur.
From the first preliminary trials it was clear that
Freedom
was the boat to beat. They took eleven of twelve match races and it was obvious that Conner’s training, testing, and investment in new technologies like Mylar and Kevlar sails were paying off. It was a difficult time for the
Courageous
crew. In a sport like baseball, teams go through losing streaks, but at least they change cities every few days. At the America’s Cup trials, you’re in Newport all summer, and getting beaten day after day is especially hard. The same guys who had a great time winning together three years before were now struggling to keep their spirits up.
It was a difficult time for me, too. We were sailing hard every day, and losing a lot more than we won. After a long day on the water, I’d shower, have dinner, and then spend the evening on the phone catching up on business in Atlanta. It had been a real dash leading up to CNN’s launch and now that we were up and running, it turned out that our expenses were nearly twice what we had budgeted while our revenues were about half. The Newport trials would have been tough enough, but with CNN losses four times our projections, the pressure was excruciating.
One evening, as I stood in the shower after a day of racing, my body started to shake. I’d been stressed before but this was a first and I realized I was pushing myself to the brink. Once I managed to calm down I thought about the situation and realized that I was struggling to do three things well. I was trying to build a business, race boats at a world championship level, and of course, attempting to raise a family. Something had to go. Ignoring my family was not an option. My five children were getting older—the older two were nearly grown—and already knew I wasn’t spending enough time with them. So it came down to sailing or business, and my decision became clear. In 1979, I became the first sailor to be named Yachtsman of the Year four times (I also received the honor in 1970, 1973, and 1977). I had already accomplished more in the sport than I ever imagined and it was hard to come up with any unmet goals that would keep me motivated. Quitting the company was a possibility—I probably could have sold Turner Broadcasting for hundreds of millions of dollars and never worked another day in my life—but unlike sailing, with my business career, I still had mountains to climb and I was excited about the future. In particular, CNN looked like it would not only be interesting, but also I believed it could have a major impact on the world. Then and there on that evening I decided that the 1980 America’s Cup would be the end of my sailing career.
So it came almost as a relief when, at the end of the final trials in August, the selection committee’s boat pulled alongside ours to tell us we were eliminated. I said my goodbyes and headed for Atlanta while Dennis and
Freedom
went on to successfully defend the Cup against Australia. In hindsight, we should never have entered the competition with such an old boat and with so little time to practice. The sport was moving in a different direction—with full-time participants and corporate sponsors—and it was passing us by. For me, retiring from the sport of sailing was bittersweet, but it was time to move on.
Turner Broadcasting would take every bit of effort and ability I could muster. Keeping the business going while staying ahead of our creditors and competitors was hard work. CNN was off to a rough start. In addition to mounting losses that were well beyond our projections, media critics were taking shots at us. We had a lot of kinks to work out and some began referring to the network as “Chicken Noodle News.” But often our coverage of a story would demonstrate that we were competent journalists and that the twenty-four-hour news concept was powerful. One such occasion was the MGM Grand Hotel fire in Vegas in November of 1980. Apart from the local stations, CNN was the only television outlet to follow this story from start to finish.
But despite these successes, we continued to confront institutional and competitive barriers that made our work difficult. In these early days, our crews were denied access to the White House pressroom and any other press pools organized to cover the president. We were told that only “the networks” (meaning ABC, NBC, and CBS) were allowed. When we responded, “But we
are
a network,” it fell on deaf ears. The broadcast networks had no interest in CNN joining their exclusive club and the White House press people had no incentive to change policy, either.
CNN could not cover Washington politics adequately without access to the White House pressroom so we were forced to sue, and we went all the way to the top. In addition to ABC, NBC, and CBS, we also named in our lawsuit President Ronald Reagan, White House press chief Larry Speakes, and Reagan’s chief of staff, James Baker. Our claim that CNN was unfairly being denied access placed the White House in a no-win situation. There was no way they could defend shutting out our journalists and once our case was made public, the issue was resolved in our favor.
CNN was still far from being a financial success but we were gaining attention and it wasn’t long before we heard whispers about rival news networks being planned. The most persistent and logical rumor ultimately turned out to be true. Just over a year after CNN’s launch, ABC and Westinghouse announced that they were forming a joint venture to enter the cable news business. This alliance made sense, as Westinghouse was operating an all-news radio station and ABC already had a full-scale television network news division. Their plan was to create two different channels and to launch them sequentially. The first, to be called Satellite News Channel, or SNC, would feature an eighteen-minute “wheel” of short news stories that they would update and repeat throughout the day. The second would be a longer-form news channel patterned directly after CNN. At the time of this announcement, we had already invested about $100 million in CNN and were still far from breaking even. Now, two multibillion-dollar corporations were coming at us with a dagger pointed at our heart.
I began to contemplate how we could combat such a competitive threat. I had purchased a 4,200-acre property in South Carolina called Hope Plantation in 1979, and it became a perfect place for the long walks I take when I need to clear my head and to think through strategic challenges. Sometimes I walk by myself and on other occasions I engage in debate with people whose opinions I value. One such person is Taylor Glover, my financial adviser and good friend.
A TED STORY
“He Was Driven”
—Taylor Glover
(TAYLOR GLOVER SPENT NEARLY THIRTY YEARS WITH MERRILL LYNCH BEFORE BECOMING PRESIDENT AND CEO OF TURNER ENTERPRISES, INC., IN 2002.)
In the late 1970s, Ducks Unlimited was trying to bring a chapter to Atlanta and I volunteered to help them out. They were planning an auction banquet and I agreed to be in charge of securing items to put up for bid. We were hoping to get a set of season tickets to the Atlanta Hawks and since I’d heard that Ted was an outdoorsman, I decided to call him directly. He didn’t know me at all but I got right through and he put me on his speakerphone. He told me that he thought Ducks Unlimited was a great organization and that he’d be happy to support them, so I asked him about donating Hawks season tickets.
“No problem!” he said, “How many do you need and which game do you want?” When I explained once again that I wanted season tickets, not just seats for one game, he said he couldn’t give away that much. He told me that two season tickets were worth $700 and that was more than he could contribute. I tried to convince him that since they weren’t selling out, it would benefit him to have some more fans in those seats, plus they’d buy beer, souvenirs, etc. I also challenged him about whether they were even worth that much and told him they’d probably only go for about half that amount, or $350 at the auction.
He didn’t buy that argument so I finally proposed a deal. I said, “I’ll tell you what. If you give us those tickets and they sell for more than $350, I’ll personally buy four of your best tickets.” He said, “Okay, you’ve got a deal. I bid $351, now you have to buy four seats down on the floor!”
I said, “No, no, no, you have to be present at the banquet to make a bid.” So he asked me when it was and said he’d be there.
We sat together at the dinner and Ted wound up bidding high on everything, including guns, paintings, a canoe—he even bought two hunting dogs. One of the final items put up was a trip to a plantation owned by Rankin Smith, the owner of the Atlanta Falcons. When they announced this trip, Ted leaned over to me and said, “I own the best duck hunting place there is. It’s over in South Carolina—a whole plantation—and since this is a duck function, I could have given a trip there.”