Interview Date: Tuesday July 28, 1998
Interview Location: Syracuse, NY
Interviewer: Jim Keller
Collection: Penn State Collection
Note: Audio Only
KELLER: This is the oral history of Robert Miron currently president of Advanced Newhouse Communications, which is a joint venture with Time Warner Inc. Bob is also a past chairman of the NCTA and is currently involved in many of the industries better known projects, the Walter Kaitz Foundation and C-Span, Cable in the Classroom, and is chairman of the Cable TV Science and Technology Policy Caucus. An interesting guy and I think he will have many interesting things to say to us. We are recording this on July 22, 1998 at the offices of Advanced Newhouse in Syracuse, New York. The interviewer is Jim Keller. Bob, to start with tell us a little about your background and upbringing.
MIRON: I was born in Newark, New Jersey, grew up in Plainfield, New Jersey, went to high school in Plainfield, New Jersey, came to college at Syracuse University, was a marketing major here, participated in some crew activities, graduated in January of 1959. Went in the service for a brief stint, and started full time work in September, I guess September, October of 1959 with the Newhouse family. Prior to that I had worked with the Newhouse family, I had worked for the radio stations in Syracuse, radio and television in 1958. Clark Tom and I had done some work for the Herald Journal and some of the other Newhouse newspapers both during the school year and during the summers from probably my sophomore/junior year in high school on.
KELLER: How did you get involved in the cable television industry?
MIRON: Well, after college I went into the broadcast industry for the Newhouse family and as the Newhouse family entered into the cable television I was aware of what they had done, and I was aware of several transactions that they had done in 1964 and 1965. I was aware of the starting really, of the venture and it had been discussed with me and then in 1966 I was asked to transfer into the cable television division, which I did do.
KELLER: Newhouse was broadcasting and also in newspapers. Do you remember the process by which Newhouse itself became involved with cable television?
MIRON: Yeah I think a combination of things, but essentially I think the existing officers knew I was broadcasting at the time. A fellow by the name of Eli Vadedoncouer and another fellow by the name of Al Eicholzer, who was vice-president of Engineering, they felt that proliferation of cable television would probably fractionalize the audiences of their television stations. And they thought one way to protect that was to get in the business. After a series of a number of efforts to convince the Newhouse family through probably starting in 1961, 1962, Mr. Newhouse continued to hedge and hold back. In 1963 there was an opportunity in Jamestown, New York, which he passed on. In '61 and '62 there were opportunities with Teleprompter and with Gerald, which we passed on. In 1964 we, toward the end of '64, we made our first purchase of a cable system in Anniston, Alabama. And then that was followed with some franchising activities in New York State, and in 1965 with the purchase of a company called Only On Video which had five small cable systems, a common carrier, Eastern Microwave which delivered distant signals. And I think that was really the start of it.
KELLER: So Newhouse got into it to protect their broadcast agreement?
MIRON: Yeah I think they saw it as that.
KELLER: Many of the broadcasters, rather than join cable, fought it as you know it, in the early days, and I think Newhouse and Cox are probably are two that decided that better off join it rather than fight it. Would you say that that is probably a fair statement?
MIRON: Yep, I would say so.
KELLER: And then, you mentioned some franchises in the early days in New York, did you remember some of those?
MIRON: In and around Syracuse a lot of small franchises there were in the north country of New York state, Malone, New York area there Rome, central New York, there were some temps in the Albany area as well.
KELLER: Kingston was one of the early systems in New York, was it not? Were you involved in any way in that?
MIRON: No, we were not.
KELLER: So what happened after that, then you started to develop the company? You joined the company in '69, you said?
MIRON: I would say, as I was joining the company, we were just in the process of purchasing Corning. Corning, New York. We purchased that in 1966. And we basically grew the company through a series of purchases and through buildings and franchises that we had. 1969 we bought CNN Potsdam, which are in the north country, 1972 we bought the Troy franchise and began to expand in that area. 1974-75 we bought Bennington Vestals, we bought two systems, one in Bennington from Triangle, we bought that in 1974, and then we bought the system next door which probably could be considered as a part a clustering from Larry Flynn. And Vestals, together with some other associated cable properties, small private properties up state, and we began to grow in that fashion.
KELLER: What was your specific involvement in the early stages of development?
MIRON: I was involved from 1966 to 1974. I was operations manager. I reported to Gerald Flemming, and I think we, together really, grew the company. During that time I was involved in the broadcast properties and I was still traveling to the broadcast properties and broadcasting stations on a monthly basis with a then a present company, which I mentioned before, with Vadedoncour.
KELLER: As the company was getting involved in cable, and you mentioned that it was primarily on a defensive basis earlier, when do you think at the point that Newhouse, or Mr. Newhouse himself, recognized that this was a business under itself?
MIRON: I think we had several difficult experiences in the early, mid sixties in a couple of the systems. A system we in Anniston, it was run by some by somebody, it was really run by somebody who was a broadcasting person, or a broadcasting system, who was responsible.
KELLER: Did you have a station in Anniston?
MIRON: We had a station in Birmingham. Television, AM/FM TV, and that was directly responsible for the property, and he didn't understand the business. We also had, in one of the systems, we built in Rome, we had some technical problems and we really didn't have it all together. I think, in the 1966, '67, '68 area we began to get it together and I finally in Potsdam in '69, 70', 69', said, "You know how we're willing to spend some money and go out and continue to grow this thing." And so I thought this was the first step, and then in '72 when we purchased Troy properties. '73-'74 we started building and turning on the Syracuse area. We were then committed to the business.
KELLER: Was cable, from the early days as a consolidated on the balance sheet of the broadcasting operations and the then we did it to contribute to the earnings of the company if that were the case?
MIRON: All right, we'll probably help company and aiding and I think we'll just following financial questions.
KELLER: It was not a separate company at the time, the cable operations that were involved in the overall?
MIRON: That's not really true. The cable companies at that time were part of the broadcasting empire, which are separate and distinct from the newspaper business. And the cable operation was a subsidiary of the broadcasting operation.
KELLER: How fast did you really develop from '69 on through the time that you formed the joint venture with Time-Warner?
MIRON: I'm not sure what you mean by "how fast", but I guess we went through the '70's with new channels expanding it. And if memory serves me correct through the 70's I think we were probably fourteenth or fifteenth largest MSO, something in there, I don't recall, but that's how I generally remember it. In 1978, I believe that was the year, I guess I should go back and say that, I stayed involved and in 1974 I really took day to day control of both the broadcasting and the cable operations, in 1978 we made the decision to sell our broadcasting properties. We made that decision because we were under challenge by a number of groups we owned. We basically had cable properties and broadcast properties in the same markets we had our newspapers, and we decided while we were winning every case we were in if we got one hit it would be a bad blow. So we basically decided to sell out of our broadcast properties. We did that and determined we would use that money and reinvest it in cable.
KELLER: So you had to make a decision between broadcasting, newspapers, and cable in the same market. And the decision, then, was to go with cable?
MIRON: Newspaper and cable, not newspaper and broadcast. Newspaper was probably a cornerstone to that decision.
KELLER: So you then divested off the newspapers and kept the cable operations?
MIRON: No we didn't divest the newspaper; we divested the broadcast property.
KELLER: Divest the broadcast property, sorry I misspoke. And kept the newspaper and also the cable system in Syracuse. Were there any other markets where you had similar decisions to make?
MIRON: We had a similar decision to make in Anniston, in Alabama, where we owned Birmingham News, a television station, and a cable operation in Anniston and the Almira area where we owned broadcast property and cable property in Corning. So basically we made a decision if we were going to get out of broadcasting, we made the decision to get out.
MIRON: Yes. And it took us, we sold the broadcast television properties in one sale and sold radio properties in the several years following that. Along that time Cox had determined that it was selling, going to sell its cable operations, and they announced the sale of its cable properties to General Electric. That sale later did not go through, but during the time of that sale the Cox then had cable operations with a man named by the name of Henry Harris, who made the decision he really didn't want to work for General Electric? We had known Henry for a number of years and we had been associated with Cox in a small cable venture outside of Cleveland. We then decided, with Henry, that we would find a venture where he and several of his associates at Cox would own a twenty percent piece, we would own eighty percent, and we would go fourth and try to build a company among ourselves. We called that company MetroVision and it was formed in 1979. We began franchising immediately and we then bought approximately 100,000 subs from Bill Daniels in Waco, Clean and Temple, Texas, and in Lincoln, Nebraska, and the Nebraska area. That formed the basis of the MSO, MetroVision, which at the time of forming our joint venture with Time Warner, had about 500,000.
KELLER: So you threw those into the joint venture? With Time Warner?
MIRON: All of Newhouse's cable operations went into the joint venture. All of their cable distribution went into Time Warner. Then in 1981 we had had an opportunity to expand again and we bought a company called Vision Cable which was owned by Sid Knople and George Linderman. We bought approximately 155,000 customers in the Carolinas, Bourbon, New Jersey, Louisiana, and franchise application in Pinellas County Florida. We grew that to about 500,000 subs over the next thirteen years. And we operated each of these as separate companies, you might call the regions, companies, but each of the MSO's, new channels, MetroVision, and Vision had separate presidents and they ran their businesses reporting into me. That's how we chose to continue to operate.
KELLER: And you continued to operate right up through virtually today?
MIRON: No, we continued to operate through the time we found the joint venture with Time Warner which was in 1994, we formed a joint venture where we contributed our cable distribution. They contributed some cable distribution and we actually formed an MSO with about 4.5 million subs, which we owned a third and they owned two thirds, and they had day to day operating control.
KELLER: So do you have operating responsibility for Advance Newhouse or is that totally with Time Warner now?
MIRON: The day to day operating control was with TimeWarner, we have certain oversight rights and privileges, and we work with TimeWarner in trying to improve the partnership, which is known as TWEN-Advance Newhouse.
KELLER: Are you operating in the cable business outside of that joint venture, at this point?
MIRON: Not in a distribution way, no.
KELLER: In the programming area?
MIRON: In programming. We have investments in the programming area. We have been an investor in Discovery almost since the beginning, and I've served on the board since the beginning.
KELLER: What ___________ the operating experience, I'd like to go back and take a look at your experience on the NCTA board. As I understand it you went on in approximately 1983, so you were on the board at the time of the passage of the 1984 act. And then you were chairman just prior to the passage of the 1992 act. I assume you were still on the board then in '96 when the Telecommunications Act was passed in '96? Could you give us an overview of how these?
MIRON: Let me just correct the record. I think it was 1983, '82-'83, that I went on the board, I'm not sure which. I was chairman, I believe it was 1988-89 or 1989-90.
KELLER: I'd say '90-'91, I could be wrong.
MIRON: No, I definitely think it was, it may have been '88-89 or '89-90, and then I was chairman again last year, '97-98, just finishing the term in May of this year.
KELLER: Then you were then on the board?
MIRON: I've been on the board throughout the whole time and on the executive committee most of the years of that....
KELLER: In the formulation and in working with the development of the '84 act, what were some of the internal problems that the industry discussed prior to the passage of that act, both in strategy and tactics? Were there any factions that wanted to, on the board itself at that time?
MIRON: There are always factions on the board. Most important was to really try to bring the association together to operate with one voice, so when we spoke to the Hill, we spoke with a common voice, and we were able to largely do that. There were very small factions on the outside. During the process of formulating of bringing together we did have some bumps and grinds, but we were able to bring together, and I did play a helpful role in trying to accomplish that. And Allen was the chairman of the association at that time and he did a very good job of bringing the issues before the board and before the executive committee, and it gave us an opportunity to thrash them out issue by issue and develop positions.
KELLER: You said there were bumps and grind; do you remember specifically what they were?
MIRON: Not enough and I'm not sure if they're relevant to, because in the end we worked it out and came out with act.
KELLER: How closely did you work with Tim Wirth in the formation of the '84 act?
MIRON: I did not work personally close with him, but the association did work very closely...
KELLER: I'm referring to Tim Wirth of Colorado, who was the senator at that time. The Association did work very close with him on loosening some of the regulations of the industry.
MIRON: More than an advocate of the industry, I think he was an advocate for trying to develop and bring the service along so it could be a meaningful service to the public. At that time we were in the embryonic stages of developing satellite services. And when you look at where we are today and at what happened between '82 and where we are today, where the industry decided to put a lot of money into programming and product, and it was that act that really was able to loosen the strings and allow the industry to develop into what it is. So I would like to say that both an advocate for the consumer and the industry.
KELLER: Then comes the era of Al Gore, leading up to the revocation, for all intensive purposes, of the 1992 act. How did that occur and how did that develop?
MIRON: Well, I think it, I would guess that the industry pushed too hard in certain areas, rates. It pushed hard or did not provide the kind of customer service that it should have. I think that there were certain areas in Tennessee where there are some very excessive rate increases. There are some programming problems, some very difficult and strenuous negotiations over sports rights in New York that brought the industry to a bad light publicly, and I think all these things began to give cable a bad name. On the other hand, if you look at it and say, "O.K., the cable industry built and wired a nation, probably the largest construction job the country has seen since World War Two". In building cable plant, and in doing that we probably stepped on a few toes, and we probably didn't do the job that we should've or could've done. And the answer was re-regulation.
KELLER: It's interesting that in my experience one of the greatest Populists, representative Pat Schroeder, again from Colorado, accused Tim Wirth, I'm sorry not Tim Wirth, but accused Al Gore at that point of demagoguery and then pure and simple out in out populism in bringing about that act. Would you agree with that statement?
MIRON: But I don't know what it does to bash the Vice President of the United States, so I don't think I would want to really even....
KELLER: That's why I quoted Pat Schroeder.
MIRON: I don't think I want to comment on that. But, you know, you think back to the time and we, Jack Valenti quoted a phrase in the middle '80's, late '80's that we were an, "unregulated monopoly". That was a very, very popular phrase and he milked that phrase for all it was worth, and he was a pro. The broadcast industry was not our best friend during that time. And we had consumers working against us. We had built up a large series of enemies.
KELLER: Jack Valenti was a former aid to President Lyndon Johnson and at that point, head of the Motion Picture Association.
MIRON: Well, it became obvious to some of us in the late '80's that we were headed down a path where there was a chance that we were going to be reregulated, and we worked very hard on a bill in 1990 that for one reason or another failed. When that bill failed in the closing days of the 1990 session I think the handwriting was pretty well on the wall with the next two years would bring a bill that would be a little bit worse then the last one. I think there were factions in the industry that felt that we might be able to resist that bill and it might not happen, and we should work to continue to stay deregulated. Frankly it just didn't work out that way, that we were not quite strong enough to put it over, as you know, that President Bush vetoed the act and the veto was overwritten. I think that's largely because we had so many enemies that were pushing against us and it was a popular thing to do, to criticize cable television. All those things led to what happened in '92.
KELLER: Just prior to the act, when people knew it was being worked upon, was probably the lowest level of many, many years of the financial capabilities of the industry itself. People got really down on cable, both on Wall Street and as of course you were talking about, in Washington. It continued to slide down until the passage of the act in '92. But there was a time prior to the passage of that, if you completely refresh my memory of that, when those of you in the business recognized that the act was not going to be as onerous as many people thought it was going to be. Is that a true statement?
MIRON: Well, I don't think we understood the act. We understood that the act was going to give a lot of power to the FCC, and we didn't know how that power would be interpreted. We later found out that the FCC had the power to make that pretty onerous. So, I don't think we were too sure. I think that we felt the act was not, and certainly was going to reregulate rates and certainly was going to give the FCC certain powers. That was going to be trouble to a lot of us. The other part of the act that I think was devastating to the industry was the fact that we, was the program access section of the bill which in effect eliminated the ability for us to have proprietary product and have tendency to more commoditize our offering, since our offering would be the same as everybody else's.
KELLER: There was also a provision in there for implied consent, as I recall, from the broadcasters. And what implied consent actually consent to carry their copyrighted programming at that point, somehow it never developed. Do you know why?
MIRON: Are you talking about retransmission consent?
MIRON: Retransmission consent did develop. Retransmissions are what we operate under today, and retransmission consent is the reason you have a number of new networks that have been able to get big analog distribution. Fox certainly made a go of it, ABC did with some product, and as well as ABC, and with ESPN2. The only network that never benefited from retransmission consent was the one who suggested it and that was CBS Kreagle, who really are responsible for that being in the act.
I guess the other thing that I could talk personally about is my own role as I became chairman in the late '80's. I recognized the one area, the several areas, we were really lacking in, one of them was customer service and the other one was really our own image. And the first thing I did as chairman was began to work on plan that would set up customer service standards.
KELLER: Bob, you were talking about your involvement in community service for the industry itself?
MIRON: Customer service. We developed customer standards and that was a lot of blood, sweat, and tears over trying to develop a standard that we would all subscribe to and that we would all commit to. To me it was very important and it was the beginning of the change of making everybody aware that customer service was something that we had to provide and we had to do it in a very high quality level, and we're ten years after the adoption of those standards and we continue to push in the industry continues to have committees and organizations that try to either raise the bar or make customer service an important piece. I think every MSO now has adopted and believes strongly... Next thing though that we did was, after we did customer service, we decided we needed to do something about image; number one, we needed to tell the world we had customer service standards, and number two, we needed to do things locally that would spread our image. We needed to do things both nationally and locally, and we formed several groups. I was head of that committee, and we formed different groups that would work with local and national image. That was the beginning, really, of the industry hiring public relations specialists to work at both the, instead of just one person at an MSO level, we built departments and have them into the systems, so that we could tell our story properly.
KELLER: Now ten years later, do you feel you've had a major impact on the systems level of the MSO's?
MIRON: I think we have had. I think there's more we could do. But I think we've had a major impact and I think some systems have taken it further than other's and that's the way of the world. Some MSO's have taken it further than others.
KELLER: Is that continuing to develop? You said that you just served, continue serving, another term as chairman. Did you reemphasize that again, in this past year?
MIRON: Yes. I think it continues to develop. We continue to place emphasis on image. I think the industry recognizes that a very important ingredient in how the public looks at us, is the image we're perceived or how we're perceived. So, yeah, I continue to discuss it. As you mentioned in the beginning, I've had an active role in Cable in the Classroom, former chairman of that, that's certainly all about giving something back and providing improvement to our image. Anybody who, all the research shows that anybody that knows what we do with Cable in the Classroom is a little more tolerant with us in respect to rates because they appreciate some of the good things that we do.
KELLER: When did this Cable in the Classroom concept develop, and how did it develop?
MIRON: It probably developed, I think, with Turner, Ted Turner and Burt Carr, coming to an NCTA board meeting in late '80's, early 90's. It developed from there with basically a commitment on behalf of the operators to put a wire into every school in the country and on behalf of the programmers, to supply commercial free programming of a certain amount that would be geared towards education, lesson plans, and things of that nature. Ted was the originator of a program called CNN Newsroom, which was a fifteen minute program that was done in the middle of the night, that was setup so it could be taped by the teacher and used in the classroom to teach current events and have the kids be able to look at news programming and discuss things at home with their parents. Lesson plans came to the teachers. I think after that Discovery joined in, A&E joined in, and a host of other programming services joined in. And it goes on today, I think there's something like five hundred and twenty hours of commercial free programming broadcast by the cable operator every single week.
KELLER: Of the elementary and secondary schools of the country, what percentage do you feel are now wired for cable television?
MIRON: My guess is that we're in the mid to high nineties. Very, very high percentage, and those that are not wired some of the cable operators are too far from the cable, they put dishes in so that they would have an opportunity to receive programming in that fashion.
KELLER: So it said something in the nineties in that, it is a tremendously successful program.
MIRON: Tremendously successful. I think the last awareness rate I saw among teachers was over forty percent and heavy usage, good usage. So it's a good, a very worth while program. Again C-Span very active, Discovery very active, CNN very active, many services.
KELLER: You mention C-Span. You've been on the board for some time, what kind of major impact do you think C-Span has made on the viewing audience of the United States?
MIRON: Well, I think C-Span provides a service that no other broadcast, newspaper outlet provides. It gives the public an opportunity to see the product, to see what's happening with their government without any editorial comment, without any spin control. It's just there and it lets the American public judge for themselves and think for themselves. I think its tremendously important and when you look upon a democracy, you say democracy is all about government being run by the people, for the people, here's a chance for the people to see what happens and judge for themselves. Different then any newspaper, magazine, or broadcast outlet you that you pick up where your getting the views of whoever's writing or reading the story to you.
KELLER: Were you on the board at the time when there was an attempt made to get into the House chamber, and then subsequently the Senate chamber, and how did that develop and what were the problems in doing so?
MIRON: I was definitely not on the board when it went into the House chamber and I don't remember if I was just starting in the Senate chamber or not. I don't have recollection to, I suggest somebody else could give you that history better then I can.
KELLER: You are also the chairman of the Cable TV Science and Technology Policy Caucus.
MIRON: Just so I'll interrupt you, that's kind of a dead issue now.
KELLER: Since CableLabs?
MIRON: I think we've feel duplicate of CableLabs with cable, I sit on the Executive Committee of CableLabs. At this point I think that that's a duplicative process. I think it had a role for a couple of years but its gone away.
KELLER: Do you think it played a part in getting CableLabs established?
MIRON: Definitely not, definitely not. CableLabs was well established before. It was done to try to, I think it's not worth talking about it at this point.
KELLER: Well somebody must have thought that there was a need for at that time?
MIRON: There was a need for it.
KELLER: And what was that need?
MIRON: There's not a need anymore, so I don't think it's relevant.
KELLER: It would be interesting to find out about someday. You've also been involved with Walter Kaitz Foundation?
MIRON: Industry politics (laugh).
KELLER: I'd like to go into that sometime. Maybe off the record sometime.
MIRON: Off the record, on the record is no good for anything. It doesn't serve any purpose. I've been involved with the Walter Kaitz Foundation, yup.
KELLER: To what extent then? Are you currently hiring people from the, interns from the Kaitz Foundation?
MIRON: I'm not currently because again, I don't have day to day management control but while I had management control we certainly hired people and Time Warner, our partnership certainly does hire people. We feel very strongly, as you move into today minority populations is playing a bigger, bigger role in and more of it. We need people on our staff that can relate to, can relate, and on top of that I believe we treat everybody equal and everybody's human and we ought to give people a shot.
KELLER: Do you feel that the Kaitz Foundation is playing a major role in doing this at the present time or could they being doing more?
MIRON: I'm on the board. I'm no longer on the executive committee. I was for a long time. I was on the executive committee and an officer of Kaitz, one year managing it. I think they play a role. I think they play an important role. I think they could always play a bigger role. What has always been disappointing to me about the Kaitz Foundation is they don't place more Fellows for the amount of money we raise, and not that they do, that we don't get more people hired. The report card of Kaitz is how many do you get hired and, you know, how well do they do? One can always do better, but we're doing an important service.
KELLER: You made a statement a number of times that you consider yourself to be a small cable operator. Do you still feel that way? Do you always have, tell me the difference between...
MIRON: Did I make that statement today or did I make...
KELLER: In some of your published information, in fact you made it in a speech to the Metropolitan Cable Club in September of '97.
MIRON: I think, yeah, I think there are two large cable operators. There are TCI and Time Warner. And then there are three or four in the next group; Cox, Comcast, CableVision, Media One or Euro Continental. And then the group immediately following them is us. I felt that in negotiations with various parties in the industry that at our size we did not have the negotiating leverage to be a major factor. And today in our [TweAm] partnership, I think we are, we do have that opportunity, and that's one of the reasons why Newhouse did what it did.
KELLER: In what context do you use the term leverage, as far as buying power, so on , etc?
MIRON: Yes, for all kinds of buying power, whether it be programming, supply, or in any negotiation for anything. I felt that Newhouse, at the time, had good cable properties, not particularly well clustered, and good size, very strong financially, and we had a million and a half subs really basically on leverage, which is a rarity in the cable industry. I felt very good about our position but I felt______ by Time Warner.
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KELLER: And has it proved to be the case?
MIRON: Yeah, I think I'm very content with what we've done.
KELLER: So you felt that you would never become a major player?
MIRON: Not unless we were willing to invest in the billions, and I don't mean one or two, but seven, eight, ten, twelve billion dollars. I don't think we were ready to become a major player.
KELLER: Who do you feel are going to be the major players in the next fifteen, twenty years? Got your crystal ball out?
MIRON: I don't think I'll use my crystal ball for posterity.
KELLER: In this context you made a statement in that same speech before the Metro Cable Club, which quoting roughly is, "Cable companies are being aggressive and full of tension and telephones are much more conservative." Do you still feel that way? This is about a year later.
MIRON: I think cable companies are entrepreneurial and are willing to, they are quite forward thinking. I think the Bell companies have, while they do think they are forward thinking, I don't think they come at the problems the same way that we do and I think as a cable operator, I believe, my beliefs are vindicated by some of the things that have happened. We have outstanding architecture. We have plant capabilities that are, that are both Arbauch's. Long distance companies, computer companies, through their investments and through what they are doing have shown that they recognize that and as some of them are trying to be more forward thinking by trying to enter into or trying to find relationships with us.
KELLER: When do you think this occurred? In the Arbauchs?
MIRON: I think they thought about this for a number of years, but have not been sure how and where to enter and how to react. One of the problems for an Arbauchs is that a cable company is essentially does not deliver earnings per share. So how they couple their desires with the lack of earning per share is very difficult for them.
KELLER: It is becoming more and more obvious, of course as we sit here today, they're trying to negotiate the TCI /AT&T deal. I think that's one of the questions that's coming up about that deal.
MIRON: Well, yes and no. I think that the deal is being structured in such a way so that there is a consumer products division that will look more like a cable operation. Or they will try to report that company more on a cash flow basis and then there will be a wholesale division that they'll try to report in earnings per share division way, and then Liberty will sit out there on its' own.
KELLER: It will still be interesting to see whether that deal is consummated. TCI also had, at one time, a tentative deal with Bell Atlantic that is not come about, so you think that the earnings per share question was part of the reason that that didn't develop?
MIRON: I think, sure that's one of the reasons. I think there are a lot of reason that didn't develop. Its probably better off, rather then I giving you my, my guess is hopefully you'll get to talk to Mr. Malone and he would be able to give you the real facts rather then me doing any guessing.
KELLER: If indeed he will.
MIRON: I've never known John to be, refuse to answer a question.
KELLER: How about the Continental/US West deal, which is now MediaOne, that seemed to come about pretty rapidly?
MIRON: No, I think that deal was in negotiation for several years, I think for quite a while.
KELLER: What do you think made that deal?
MIRON: I'll give you the same answer that I gave you before. I don't mind talking about Bob MIRON: and what he's done but I think when you, when you want to know what made the ....
KELLER: I want to know what your opinion is.
MIRON: Well, I think my opinion is secondary to what Amos', Tim Nehn's, Chuck Willis', and Dick McKormick's are. I think they would give you the real fact.
KELLER: They will if you ask, but just wondered what your opinion is.
MIRON: Fair to ask, but...
KELLER: Respectfully declined to answer. Is Newhouse going to be more involved, outside of the Advance Newhouse joint venture at this point, in cable television of future telecommunications? Or are they considering it?
MIRON: I'm not sure what you are asking me. Maybe be a little more specific.
KELLER: Do you foresee the day when Newhouse will get back into it as a company itself as opposed to what they are currently doing in the joint venture?
MIRON: I don't foresee it at this moment, no. We are very pleased with the way the partnership is going. The partnership, as I told you, started out with four and a half million subs, we've taken in additional subs, and we're above five and a half million subs today. So I think we are very content. I think the four and a half actually included Primestar and today's five and a half does not include Primestar. If we still had Primestar in there our subs would probably be over six million subs, 5.8, 5.9.
KELLER: You mentioned earlier that you currently have investments in certain programming entities, in the business. Could you enumerate those please?
MIRON: Well we still, the only investment we're left with today, I believe, in the programming area, is not part of Discovery Channel. I believe that every other investment is part of TWEAM.
KELLER: TWEAM being the Time Warner advanced. Your separately involved in Discovery of at the present time.
MIRON: We were separately involved.
KELLER: Are you involved in any programming yourself, in developing the program for this doner?
MIRON: I'm on the board of Discovery and I'm an active participant as a board member.
KELLER: Where do you see Bob MIRON: going, in the industry, in the next ten years or from now until the time you retire?
MIRON: Fishing I hope.
KELLER: No, before you retire.
MIRON: Oh, I don't know, I think I'll probably continue to play the same role I've been playing, I think I play a role in the industry. For the last number of years I've been able to walk between a lot of the factions in the industry. It's a little easier as quote the "small cable operator" it's a little harder now as part of TimeWarner but I'm still I think I have a reputation. I have a confidence in a number of people so I think I can work between people to help things get things accomplished.
KELLER: Maybe develop that a little farther, the difference between when you were an independent operator and was it easier to work with the industry than it is today?
MIRON: Well, today somebody looks at me and they're not sure whether I'm Bob MIRON: or whether I'm talking with my TimeWarner hat. So, and as with any big company, whether it be TimeWarner or TCI or other operators look at me with a sort of suspicion as they have their own agenda and I think I was always looked at as somebody who didn't have the separate agenda that would be. So that's the difference. But I suspect I'll continue to play a role in our TimeWarner venture. You know we have the partnership where we are active in the developing, we just recently developed a venture with MediaOne and Compaq and Microsoft/Roadrunner and we have an active role in that. We just formed a separate company with TWComm, splitting that off from TWEN divisions, and I'll play an active role in that and that's the business telephony. You know I'll continue to stay active in all the different Time Warner/Advanced Newhouse ventures.
KELLER: I have two questions about that and then maybe this is looking into the future again. Number one, what do you see as the major problems facing the industry today?
MIRON: Major problems, I guess are, you can look at it as being ourselves and that we how we act and how we go forth in the next 6 months. I think will have a lot to do as whether or not Congress comes and looks at us again and revisits regulations again.
KELLER: Do you foresee that?
MIRON: I foresee that Congress will look at us again. I do not foresee that they will take action. I think that remains to be seen, but I think that we will certainly get considered.
KELLER: When do you believe this will happen?
MIRON: I believe this will happen some time during 1999. Not that we will see anything happen but that Congress will look at us.
KELLER: Do you feel, as you pointed out, that you are an important part in developing customer service and community service standards of the industry? Do you feel that this will go a long way toward a mediorating Congress looking at us and what devastating affects it might have if they do?
MIRON: Well, I think the key question is rates. I think that how we react in the coming period will have a lot to do with how Congress reacts towards us.
KELLER: And do you think we're getting a better image, daily, as we go along it may somehow or other affect us then?
MIRON: Not particularly.
KELLER: So you're feeling the industry has a long way to go?
MIRON: The industry is an easy whipping boy whether our rates are fair or unfair, people look at television and they think that they ought to see television for free. Well we're not free, and so immediately we have a negative connotation, and I think we're an easy whipping boy for Congressmen. People love to hate their cable company and for a Congressman to stand up and say, "Hey let's kick the cable company, I'm all for kicking" you know it's not a...
KELLER: It's not an unpopular thing for a congressman to say. So you feel it's going to come back and they're going to do it again on the same basis as it was done before?
MIRON: Oh, I certainly didn't say that. I said they would certainly consider it, and I think, hopefully, cooler, smarter heads will prevail because we have provided some real alternative viewing for the public. We do have competition today in DBS. There is competition in residential, there is competition in the MDU atmosphere. There is plenty of competition out there so I don't think regulation is the answer. I think we also have a big job ahead of us as we update our systems and we need to continue to so that.
KELLER: As we develop rates, how is the industry going to get the message across that our rates have to be compensatory without regulation? The term compensatory is a regulatory term in itself.
MIRON: I think we'll have to convince the public that we are providing a real value. When you look at the way different companies raise their rates and the reactions that you get it is possible to see how some companies are able to tell their story in the proper way, presented in the proper way to the public, in a fair way, and some companies have not been able to do that. I think customer service plays a role in that, I think adding plays a role in that, value plays a role in that, I think their image plays a role. There are so many things that play a role. Unfortunately we are not one company, not unfortunate, but we're not one company and we're eleven thousand cable systems in this country and every on effects and deals with the public in a different way.
KELLER: Do you feel perhaps, the term "cable television" itself may be out dated?
MIRON: I really haven't thought about it much.
KELLER: Is there ever going to be a way where we're going to be able to separate the various services that the industry is currently providing? Basically from those that are considered to be a necessity, as opposed to those that are going to be considered futuristic kind of services or additional services such as telephony?
MIRON: We'll have to decide whether we want to separate them or package them. There are certain advantages to marketing as packages and there are certain advantages to selling the services separately and we'll have to decide, each company will decide for itself which is thew best way to so that.
KELLER: Do you think that that will be one of the things that Congress will be looking at in the next couple of years, that you mentioned?
MIRON: No, I don't think they will care whether we sell cable and Roadrunner on one bill or whether there are two bills, I don't think Congress will care about that.
KELLER: You don't think they will look at separation of delivering programming, using programming in a broad spectrum?
MIRON: I certainly hope we don't get treated as a common carrier, if that's what you're suggesting.
KELLER: I'm not suggesting it, but I'm saying it is a possibility, don't you feel?
MIRON: I certainly hope not, and we will certainly work to insure we are not a common carrier, that we add value.
KELLER: When you say we, do you feel AT&T and US West will also feel that way?
MIRON: First US West is not US West, it is Media One. US West is now a separate company. Media One is a cable company. I think AT&T, I don't think they look to become a common carrier. No I think they would look at it, they want to be value added type service. I don't know you would have to ask, Bill Henry would be able to tell you that.
KELLER: We're more interested in your opinion, as opposed to the people that are involved in it?
MIRON: Theirs is the one that counts. I know that from a Newhouse perspective that we prefer not to be a common carrier.
KELLER: When do you think the industry as a whole is going to get involved with telephony, to a large extent? More so then they are now?
MIRON: I assume you mean residential telephony?
KELLER: I do.
MIRON: I can't answer that. I think that each company has to look at that individually. Each company has to determine in what way they do become involved. It is, to me, important that we look for ways that our plant can be used to provide telephony. Whether it is provided by us, on a retail basis or a wholesale basis, I think as we build that platform out we then have the ability to provide that service. So the key thing to me is to build that platform.
KELLER: I would agree with that. Do you remember at a point where there was a definite plan to separate the telephone companies from both their coaxial cable and their twisted pair, voice only delivery system? To the point of going for a certificate of convenience and necessity if they were going to get involved in anything other than just the two way voice transmission? Is that fear going to come back again to haunt the telephone companies, do you think, as far as the regulatory agencies are concerned?
MIRON: I don't know, it's hard to tell. If a telephone company wants to get in our game, they should get into it on the same footing we do. They should compete with us with the same restrictions that we have and the playing field should be level, if they're going to compete.
KELLER: But the difference between we and they is becoming closer...
MIRON: Yes and no. The telephone companies are a long way from having fiber _____ ______.
KELLER: So is our industry.
MIRON: Nowhere near as far as the telephone companies are. I look at various companies in our industry are a long way down the road, a long way down the road. Telephone companies are still talking about DSL as the answer to provide a data service.
KELLER: Don't you believe that there will always be those cable operators and those telephone companies which are going to look at the industry as separate and distinct in certain markets as opposed to the now with the AT&T's and US West's... separate type of businesses sure?
MIRON: Every cable operator is going to look at things in his own way. Every cable operator has a different agenda. Some are small, some are financial players, some are in it for the long term, some want to turn their systems. So sure, some are privately held, and they have different requirements for return on investments. Everybody's different.
KELLER: As you go back and you look at the combining of industries, you had the Leonard Reinschs, and the Al Sterns, and other people who primarily associated in broadcasting, and also you at Newhouse, became involved in the industry and served in a capacity to assist the development of the industry. And then, of course, you've had the other people in broadcast, exception CBS, who continue to fight the industry from day one. Do you think you are going to see the same thing developing with various telephone companies today? Are we going take an Armstrong on board of the NCTA very shortly? As we did in Al Stern? Or Bob MIRON:? Or Henry Harris?
MIRON: Bob MIRON: and Al Stern and Henry Harris were largely cable operators.
KELLER: But they were broadcasters also.
MIRON: But they became cable operators. And I think we'll have to see what we'll have to see what Mike Armstrong does, whether he becomes a cable operator, or whether Leo Henry stays to be his cable operator. If Leo Henry is his cable operator, obviously he would play a role in that.
KELLER: That's an important distinction. Again you mentioned it before because you thought there were going to be two separate entities within the AT&T family...
MIRON: That's what been reported, pretty well.
KELLER: Any other particular and specific observations you would like to make in your thirty-year career in cable television that we haven't gone over at this point?
MIRON: One thing that we might touch on is the importance of CablsLabs. We touched on it in terms of NCTA. CableLabs have played a very vital role, a real role. Pleased to play a role within that organization, currently on executive committee of it. As we move forward, and as we, really the computer industry's involvement stem from CableLab, trip by the executive committee about a year and a half ago, where we sat down with a lot of the leaders in the computer industry. We've now begun to do some things in CableLabs with, as a group, with other important parts of the communications industry and consumer electronics industry. And I think those are important discussions to bring about a peaceful coexistence between those industries, which really, in the end, meet by an easier road for the subscriber.
KELLER: Do you feel that all the services are going to be combined into one common distribution capability?
MIRON: By distribution capability do you mean...?
KELLER: I mean method of distribution, as telephone versus cable versus satellite...
MIRON: I think we'll have a number of different distribution possibilities, some for the services, some for other services, some may be for most of the services. I think we would have to consider and choose what delivery method he wants, and what level of service he wants. I think there will be different levels of data service, different speeds, and you may be able to get similar speeds in different factions, so I don't think that there will only be one path. I think that there will be competition in most every area.
KELLER: Our spies have said that you've become intensely interested in the technical area of, not only cable television, but also the future of the industry, from the technical side. It's a departure from a marketing man, isn't it?
MIRON: I don't think schooling had anything to so with it. I think as you get into the cable television business we've had to progress technically. In order to understand what the consumer wants, try to figure out what service you want to provide, you need to understand technically what you can do. And you have to match what you can technically so with what the consumer ultimately wants. That's when you have a business.
KELLER: At a recent meeting, Sid Topol divided the progression of the industry into three basic eras. The first one he called the "pre satellite" era; 1948 to 1973,'74. The second from that time through 1992, which he used the term the "satellite" era, he used it from 1992, maybe 1994, on into the future as the "digital" era. Would you generally divide up the history of industry so far a those three components?
MIRON: Sounds pretty good to me.
KELLER: Would you add anything to those three?
MIRON: No. Not really thought about it. He's give some though to it. It's certainly one way to divide it.
KELLER: You would agree that the satellites were the major development in our industry?
KELLER: Without it you probably wouldn't be building in major markets right now. You wouldn't have the penetration that we have today.
MIRON: Unless we found some other way of providing product, but correct. Would it be by fiber or by something else, who knows, but it certainly is a very efficient way to deliver signals around the country.
KELLER: When did you first put HBO on your systems?
MIRON: I believe it was either 1971 or 1972.
KELLER: Very early on.
MIRON: HBO developed via microwave prior to satellite, and although the first system was served by Johnny Walson's microwave company, Service Electric, the majority of the HBO microwave distribution was over a company that we owned that was called Eastern Microwave. We, at the height of HBO, microwave feed, fed serve signals to some hundred and fifty systems from, through New York state, Pennsylvania, Massachusetts, Vermont, New Hampshire, New Jersey. We even at some points when the large dishes first put in we would download, for example, in Pittsburgh with a ten meter dish then distribute it by microwave to many systems around there. I believe we probably served some systems HBO by microwave until the early 1980's, '82, '83.
KELLER: Did you originally get into the microwave business to serve your broadcasting operations, or was that separate entirely?
MIRON: We got into the cable business in New York state and in Alabama, we recognized that distant signal importation was important. So actually when we bought a couple companies we purchased small microwave companies with them that were feeding these distant signals to the individual cable systems. We grew both those businesses.
KELLER: So it didn't have anything to do with delivering broadcast signals at that point?
MIRON: No. We delivered WOOR, WPIX, WNEW, to systems all over the Northeast.
KELLER: So HBO came to you and asked you to filter their programs at that point?
MIRON: That's correct.
KELLER: Dolan and Levin at that point?
MIRON: While we had earlier conversations with Dolan. I think we turned our first system on in Corning, New York. It was the first one we turned on, and I think it was 1971 or '72.
KELLER: Putting on your technical capability hat on right now, a big question in the industry seems to be the development of the interfacing box, cable modem or whatever you want to call it at this point. How do you see that developing and who's going to play a major part in that, in your opinion?
MIRON: How do I see it developing...
KELLER: And who's going to play a major part in that.
MIRON: I think CableLabs will play a very major part. With CableLabs, all the MSO's will play a role, as well as REA, GI, and some electronic people. I think we are working to develop open cable set top box. We've committed to the FCC that it will be sold at retail in the 2000. We will make that happen.
KELLER: You don't believe that the systems will be able to own the boxes themselves?
MIRON: People will have a choice. I think the systems, someone will have a choice to take the delivery from the cable operator or to take, to buy the delivery from a retail store. Security is obviously something that needs to be worked on and we have developed ways to separate the security from the box. The box sold at retail will be moveable so that if you live in Time Warner system and you invest in a box at retail and you move across the country to a TCI system it should work.
KELLER: As you know it has always been the desire of the industry, over the years, to control the input and the use of their product, through use of the interface device and converters and so on, the industry is rather reluctant to allow for retail sales of their converters.
MIRON: Not true. The industry has been reluctant to relinquish the security. The most important thing is that we must have the security separate. The box itself doesn't matter, the tuners in the television set. So if you have a cable ready set you didn't need a box. You could subscribe to cable and you didn't have to have a box. All we really want to control is the security so that someone can't just plug the box in and have it work on our system and take all our products without paying for them.
KELLER: So you have separated the security, then, from the interface modem in the future box?
KELLER: Interesting. Bob, we really want to thank you for giving us the opportunity to visit with you and to give you the opportunity to add anything else you want to say at this point.
MIRON: No, it's been a fun ride.
KELLER: It really has been a fun ride. It's an interesting ride.
MIRON: I'm not sure any of us could have predicted, you know, how it would've happened. You keep putting one foot in front of the other and it seems to work.
KELLER: You mentioned before we got started that...
MIRON: Did I miss anything by the way? Family? I've got three kids, all associated with the business at one point, and a wife associated with the business. My wife was a schoolteacher for years and was associated, as a schoolteacher, began using cable in the classroom. As she developed and became one of the strong proponents for it she later found that she would retire from teaching and she now has worked as a cable television coordinator for our company for a number of years and still operates in that field. I have two children who started in the business that at an early age and one of them today works for Time Warner as a, he is responsible for about a hundred and fifty thousand subscribers in one division. Another child who is working for Time Warner who is very active in the customer service for Time Warner, in Charlotte, of running their customer service division and now she is responsible for Roadrunner in Charlotte. I have a son-in-law who is affiliated sales, who's a lawyer for Discovery Channel at this point.
KELLER: We've talked about the successes that you've had in the industry. Do you feel you've made any major mistakes?
MIRON: I'm sure I've made mistakes. Obviously any property that I was not able to convince ownership to buy is a mistake. Any investment we did not make was a mistake. Everything we did seemed to work out all right. The biggest mistakes are mistakes of ownership.
KELLER: Any errors of commission you'd rather do over again?
MIRON: I'm sure there are but they don't come to mind right at the moment.
KELLER: Thank you, Bob. I might for the record mention that Joel Fleming, a former employee of Newhouse, was sitting in the room with us as we were going through this.
MIRON: He's my former boss.
KELLER: And Joel will be joining us in and doing some of these interviews in the future, and we're delighted to have him. Thanks very much Joel, and thank you Bob.