Interview Date: Tuesday August 08, 2000
Interview Location: Atlanta, GA
Interviewer: Jim Keller
Collection: Hauser Collection
KELLER: This is the oral history of James O. Robbins, President and CEO of Cox Communications, a Cox Enterprise Company. Jim is the immediate past chairman of the NCTA and also served a first term as president in 1991 and '92. Jim is also on the executive committee of C-SPAN and is chairman of Cable in the Classroom. This oral history is brought to you by a grant from the Gustave Hauser Foundation as part of the oral history program of The National Cable Television Center and Museum. The date is August 8, 2000. The interviewer is Jim Keller. Jim, tell us a little bit about your background prior to the time you got in cable.
ROBBINS: Jim, good afternoon, first of all, and thank you for coming to Atlanta to do this.
KELLER: Our pleasure.
ROBBINS: Ever since I was in college, maybe even high school, I was fascinated with the media and I really thought I wanted to be the next Walter Cronkite and in college and in high school, I was playing sports, not reporting sports, and so I didn't get a lot of experience as a reporter and after college I went immediately into the Navy. I was in the NROTC program and after my first tour of duty in Vietnam, I had a chance to either get out of the Navy with a two year Navy contract program or re-up and maybe learn something about the press. And I actually decided to re-up in the Navy, go for another tour of duty in Vietnam and in that tour became a public affairs specialist with an outfit called the Mobile Riverine Force.
KELLER: Batton River?
ROBBINS: On the Mekong River. I spent all of 1967 on the Mekong River. But while I was in the Navy on my destroyer operating in Vietnam, I used to rip and read the news over the ship's one MC every night and that just got me more interested in this business called television news.
KELLER: You became a ham, huh?
ROBBINS: I became a ham. Anyway, I got out of the Navy, worked for a guy who was running for Congress as his press secretary, more sort of in the media, and then one day when I was about to go for a final interview in Tulsa, Oklahoma, I got accepted at a business school up on the East Coast that I thought long term would probably serve me better and open a few more doors than chasing ambulances in Tulsa. So I wound up at Harvard. The summer between my first and second year at business school, I went to work at a television station called WBZ and I worked on a show, it was a news magazine show from 9 to 10 in the morning called New England Today. It was a sequel to the Today Show, and as happenstance would have it, the guy that I was working for had a child who was sick that summer, so I wound up doing a lot of the programming. They though enough of me to ask me to stay on after graduation and I said, "Well, I want to go down to the newsroom because that's really where I want to be." And so I went down there as managing editor – assistant managing editor and then took over when my boss was let go and was managing editor of television news always wanting to go on the air and they said to me, "Look, this is the fifth market in the country, Jim. You're nuts. You want to go on the air, go on up to Burlington, Vermont or Lebanon, New Hampshire or something like that, a little small market and maybe you can do the weather on weekends to get started." Well, that didn't make a lot of sense to me and I was chasing my then girlfriend and now wife of almost 30 years, so we stayed in Boston and I started about a year later looking around at how I could combine my interest in television with an academic background in small business, really, and wound up going to work in June of 1972 for a company called Adams Russell. They had a subsidiary called the Montechusetts Cable Television Company, or something like that. Anyway, I became General Manger of Fitchburg, Leominster and Gardner, Massachusetts and that was my first job in the cable business and I must say, it's been a blast ever since.
KELLER: Once you start you never get off that horse, do you?
ROBBINS: Well, it's been a hell of a horse to ride.
KELLER: It really has been for all of us.
ROBBINS: We've had tremendous fun.
KELLER: So after you got into it, then, with both WBKZ, or W...
ROBBINS: WBZ, it was a Westinghouse station.
KELLER: Was there an affiliate, a national affiliation?
ROBBINS: They were affiliated with NBC.
KELLER: Then you went with Adams Russell. What happened after that?
ROBBINS: After Adams Russell, I was there for a year and half and then went to work for Continental Cable Vision, worked for Bus Hostetter and Irv Grousbeck out in Ohio. Our first child went to Ohio with us and we had two more children in Ohio and that was a wonderful place to bring up children. I was building and franchising and doing all of that stuff in those days and did the Dayton donut, all around Dayton and had a great time, worked for a great company. I really learned the business there over a five or six year period.
KELLER: It's a great company to learn the business from.
ROBBINS: It was a terrific company to learn the business from and Bud Hostetter remains a good friend today.
KELLER: And then you went out to the West Coast, didn't you?
ROBBINS: No, then I had a chance, they wanted me to move to St. Louis and I was from the East Coast, my wife was from Boston and I was from New York and I wanted to maybe go further East and I had a chance to go run cable in the eastern half of Long Island. It was a little bit of a turning point for me in that in Ohio I was managing a collection of small systems that totaled maybe 100,000 customers at that point. I had a chance to go to Long Island and run one big system that had 75,000 customers or something like that and I thought, well, that's a different experience than running a region of smaller systems.
KELLER: This was '72?
ROBBINS: This was actually in '79 and so I thought that would be another thing I ought to check off in my reservoir of experience, running a big system, and that turned out to be fortuitous. It was a different kind of challenge.
KELLER: What were the differences in the challenge between operating numerous small systems and one big one?
ROBBINS: Well, in running numerous small systems you relied on the managers of the small systems and you went and you counseled them and you coached them and you worked with them and you helped them in their franchising if they needed it.
KELLER: Like you're doing now.
ROBBINS: Yeah, and it was working through generalists like yourself. When you went to one big system, it was more like what I'm doing now and that is I've got a chief engineer, I've got a chief development person, I've got an operations person, so I'm dealing here with a collection of specialists, just the way I did when I was running eastern Long Island and they'd each bring their point of view to the table on whatever the issue was and then ultimately I had to decide between shades of gray and that was a very different experience.
KELLER: That was with Viacom?
ROBBINS: I'm sorry, that was with Viacom, yeah. There I was hired by John Goddard – no, I was hired by Chris Derrick and then he left and John took over and John wanted a guy in New York and anyway, he hired a fellow by the name of Ed Bennett.
KELLER: I know him.
ROBBINS: I wound up working for Ed and I don't think Ed had ever been in cable operations before and we worked fine even though this was sort of a strange mix of the way people had come together.
KELLER: What was your graduate school major?
ROBBINS: I majored in – at Harvard you didn't have any majors.
KELLER: Yes, you specialized in...
ROBBINS: If I concentrated anywhere, I concentrated either in marketing or in small business. I really thought I was going to be sweeping the sidewalks of the leaves and shoveling the snow in the winter in front of a small business where I could mind my own business and not worry. I never, ever, ever in my life thought I'd be involved in a big corporation.
KELLER: Well, apparently it's been right for you.
ROBBINS: It's worked and we've had a lot of fun and most of it is because of great people.
KELLER: That's the key to everything.
ROBBINS: I really think it is and it's been the key to my career since Adams Russell, I'll tell you that.
KELLER: It's interesting that Cox, primarily at that time, was a print oriented company in the newspaper business. They did get into the television station business and I got the history of Leonard Reinsch and getting into cable television and being the motivator of Cox getting into cable television, but it's always been amazing to me that this old conservative first line print company ever got into cable television. How do you read that?
ROBBINS: Well, the history of the company is such, Jim, that if you follow it it's a 102 year old company today and we've never been afraid to get into new technologies. Yes, we were a print company but in 1922 we got into the radio business and then we got into the television business, I can't tell you when, and then we got into the cable business. At one point, Cox Communications, or Cox Cable was a subsidiary of Cox Broadcasting.
KELLER: I remember that very well.
ROBBINS: Anyway, the company and the family has never been afraid of going into new technologies. We were in the cellular business for a while and made a decision that we couldn't be a big enough player in it so we got out of that but we were in the PCS business early on because we thought it was a way to leverage our platform. So, this is a thread that I think Leonard carried forward with great aplomb. Try new technologies; don't be afraid to try new technologies. The pie gets bigger every time one of these technologies evolves. It's not a share shift.
KELLER: Once you came over, you followed Jim Wright, didn't you?
ROBBINS: I actually followed David Van Valkenburg.
KELLER: Was he President of Cox? I wasn't aware of that.
ROBBINS: Yes. When I came here, in fact I had a couple of interviews with Bob Wright, they wanted me to go run a company called an S TV operation in St. Louis and I said I thought that was a lousy technology and a lousy business and thanks but no thanks, I had no interest in doing that. That was my first kind of foray with Cox and then they came back again and they said, "Jeez, you made a wise decision that made a lot of sense. Would you be interested in doing this?" And I didn't get that job. I was being pursued for one of the operating jobs here and then lo and behold, they came back later and said, "Look, you live up in New York. We've got a half a franchise in Staten Island and we've got a management services contract with Percy Sutton for Queens, half of Queens, and we need somebody who knows about New York City to do this." In fact, David Van Valkenburg, who's not normally a very colorful guy in terms of language said, "Jim, I feel like a virgin in a whorehouse in New York City." And so anyway, that's how I joined Cox in 1983 as the manager of their interests up in New York City.
KELLER: You needed a Jack Gault in New York.
ROBBINS: Well, what I did was we worked through lots of things but I came to pick up Peter Gilbert as our partner. Continental had the other half of Staten Island. It was a great market, huge density, 80+% owner occupied housing, I mean a fabulous market.
KELLER: Peter Gilbert was a character himself, wasn't he?
ROBBINS: Peter Gilbert – I had run eastern Long Island, which he had originally built and then sold to Viacom, so I knew the legend of Peter Gilbert through a lot of stories there and he was a great guy. Anyway, I found him and I said, "Peter, you're the guy for this." And he stepped into Continental's shoes and he ran the project and we had a terrific relationship.
KELLER: Did he have an equity interest in it?
ROBBINS: Oh, he had a big equity interest in it.
KELLER: Oh, he kept it then when...?
ROBBINS: Yes, he stepped into Continental's shoes.
KELLER: And he ran it then for Continental?
ROBBINS: Right. He was a half owner and ran it and we were thrilled and everybody made a lot of money on that project and he was terrific. He's a guy that's no longer with us...
ROBBINS: ...today, but a great guy.
KELLER: And how! I can remember great meetings with him.
ROBBINS: And a real entrepreneur and if you needed to figure out how to get things done without going through all the paperwork and crap that the bureaucracy in New York City would put you through, Peter Gilbert was just the guy for that job.
KELLER: You know, it's interesting that you came into Cox from the operating side and then advanced to the Presidency through the operating side. That is rather unusual in cable television. Most operating people don't make it to presidencies in large companies.
ROBBINS: You know, that's ironic...
KELLER: I always thought it was.
ROBBINS: Well, it's ironic that you say that because here at Cox, historically, the leadership of the company has risen up through the operating ranks. That's been true on the newspaper side, that's true in the automobile auction business, it's true on the radio side, the television side, it's true throughout Cox.
KELLER: I think it's great.
ROBBINS: And we think of ourselves as a pretty good operating company although there's nothing to say that somebody with a finance background or marketing background or some other kind of background couldn't run... What you're really referring to is most of the other guys in the business came up through the financial ranks.
KELLER: Financial, yes. Virtually so. One way or the other.
KELLER: Very few from the management side. There are a couple of exceptions, Joslin is one of them. Ray Joslin is one that came up through the operating side, but not too many. John Goddard came up through the operating side, but I can't think of too many. But when you think of Cox, I think you think of three primary attributes: excellent management, great customer service, and an involvement in community service. I think those are the three characteristics of Cox. Would you agree with that?
ROBBINS: Yes, and I would tell you that I think we are distinguished above all others in the customer service area.
KELLER: No doubt.
ROBBINS: Let me tell you a couple of things though, as we're talking here Jim. When I was at Continental, I really thought I learned a lot about this business and I've done two things differently here than were being done at Continental and I think they were to some extent the sign of the times and they were good decisions. Number one, I centralized early on the IT business because I felt that increasingly the...
KELLER: IT being?
ROBBINS: The information systems, the information technology.
ROBBINS: MIS platform. When I first came here we were in a quandary as to whether we should be decentralized or centralized and we went decentralized early on.
KELLER: You went back on your experience with Continental then, from an operating standpoint.
ROBBINS: I did and the decision there was to give as much control to the local operating managers as we possibly could.
KELLER: There would have to be certain exceptions, I think. Finance would be one.
ROBBINS: Yeah, oh sure. Your P & L and all of that.
KELLER: What would be the other exceptions?
ROBBINS: That's one. I think increasingly we felt that service call reporting needed that kind of attention, but what happened is we began to get one off kinds of applications and numbers were coming in a little bit different. We were a private company at that point so it didn't really matter a whole lot, but into the '90s it became increasingly clear to me that as we were going to add new services and trans-standardize some of these things, we needed to bring that function into Atlanta. We did that.
KELLER: Customer service?
ROBBINS: No, the IT platform. We did that and there was some strain and there was some pain and there was a lot of gnashing of teeth on the parts of the general managers who felt they were sort of losing control of their life, but in fact, I think the last half of the '90s when we've offered all these new products and services has borne out the theory that you've got to have a centralized technical platform and an information systems platform from which to drive the business. There are companies today that cannot put out one bill for voice, video, and data and it's a critically important issue. The other issue...
KELLER: But originally did you use it for reporting purposes?
ROBBINS: Oh, yes.
KELLER: That was the original purpose of it?
ROBBINS: Oh sure, oh yeah, and we also used it so that our customer service reps could know what was going on with each customer, but the whole level of sophistication in MIS, as you call it, has increased remarkably and that was a departure from what Continental did. The other departure was to set a national technical platform and I really credit two things. My own fear and ineptness in knowing anything about engineering and Alex Best's wonderful presence here with our company. He came from Scientific-Atlanta and when he got here he saw lots of different platforms out there and lots of different things going on and over time we really standardized, we set technical standards from Atlanta for all of our systems and that doesn't necessarily mean that one size fits all. Some systems it was appropriate to have 450 technologies, others 550 or 750 later on. But it was a departure from Continental where each of their seven regions, when I was with the company, they did their own thing and yeah, the regional people talked but there was no formal structure of what they did and one guy might like Jerrold and the other guy might like SA and so forth and so on. I think that helped Cox a lot.
KELLER: Did you standardize on then one manufacturer?
ROBBINS: No, we stayed with two manufacturers because we always felt that two sources of supply were obviously better than one, but standardizing the technical platform, I think, really helped us a lot and I know it's helped me as a manager and a CEO that I could turn to Alex and he knew exactly what was going on with our platform. So those two things were important.
KELLER: The technical aspect goes way back to Lew Davenport and some of the other people in the very early days when they were directing the engineering for Cox.
ROBBINS: Yes, and we had a technical... I mean, when I first came here one of my not so nice jobs was we had 40 or 50 white coated engineers in a laboratory downstairs and I said, "No, let the manufacturers do the R & D work. We don't need to do the R & D work; we're an operating company." And that turned out to be hard but...
KELLER: Did these white coats ever produce anything of value?
ROBBINS: No. They produced a converter at one point that turned out to be... I don't know what the devil... We called it the Cox 1000 and I think that they're probably a museum piece today and I hope the cable museum's got one.
KELLER: I've never seen one. The Cox 1000?
ROBBINS: Yeah, yeah.
KELLER: Converter, huh?
KELLER: And that was all they produced?
ROBBINS: That was all. It didn't make any sense to have them here at all.
KELLER: It's the only company I know that had such a thing. Well, of course Cox has always been unusual in a lot of respects.
ROBBINS: That one was strange.
KELLER: Now, the centralization, excuse me, the centralization led to your current NOC, the National Operating... what do you call it? The National Operations Center?
ROBBINS: NOC, yes. But that really came about as a result of being in the telephone business.
KELLER: That's another subject I want to get into.
ROBBINS: That didn't really have anything to do with a standard engineering platform.
KELLER: But you said you wanted to get a handle on customer service at one time.
ROBBINS: Yes, let me tell you how that evolved. It was really in the late '80s that we had some employee opinion surveys and there was some anecdotal information from those surveys that said some of our employees felt we were not doing as good a job serving our customer as we could have. Well, for any CEO to hear that, that's an indictment of a CEO's leadership.
KELLER: Except... there have been exceptions in the industry and I won't name them but there have been exceptions.
ROBBINS: Well, you and I know there are a lot of them. We had a very simple attitude on this thing. We knew, Jim, that longer term there was going to be competition and the best defense against the incursions of competition were one, a real satisfied customer, which means we had to put our customer service in shape, and two, channel capacity to match or exceed what the satellite offered. So, really at the end of the '80s we said customer service is important and channel capacity is important and we drove down that path really for five or six years and of course it's the foundation of what we're up to today. I don't know that our technical platform is a whole lot different than anybody else's, but I do think the value system that we have about customer service is more important today than ever because if you're not a happy customer today you're never going to try telephone or high-speed Internet access from us. If you are, you will and the thrust for us today is bundling, bundling, bundling. That's how we're going to keep you as a customer because the more stuff that you sign up for, the better price value relationship you're going to get from Cox.
KELLER: And of the doubling that you want to do within the five-year period – you made that statement maybe a year or so ago...
ROBBINS: That's my boss's statement and I repeat it as a good soldier.
KELLER: All right, but the fact is you anticipate doing that primarily through services other than providing cable television services?
ROBBINS: We think, Jim, maybe in five years that our core cable business as we know it today may amount to 50% of the revenues and the rest of them are going to come out of advertising, telephone, high-speed Internet access, home networking, security, Internet through the television, interactive television, video on demand, any number of things. And that's frankly one of the things that's so much fun about being in the business today. What are the new products and services that are going to go down the pipe? Can you make money on any of them?
KELLER: It's one of the values of having a pipe rather than over the air type services.
ROBBINS: You bet.
KELLER: It's a great tool.
ROBBINS: You know, we're meeting on a regular basis on this whole subject of what are the things going down the pipe that we need to really hone in on.
KELLER: Once you got out of the SST business, or the microwave business in communities, including Denver, you've never been in the wireless business again, have you? Except for the PCS?
ROBBINS: Just PCS.
KELLER: Then you're a part owner with Sprint, is that correct?
ROBBINS: We're a part owner with Sprint and Comcast and Liberty.
KELLER: Those are great partners.
ROBBINS: Sprint PCS. Yes. But the reason we got into that is actually somebody at Cox Enterprises said, "Hey, they're offering some experimental licenses based on a technology that would use the cable platform as the return path for the Sprint PCS conversations." So we got an experimental license in California. We wound up having to pay for it – for some strange reason the government reneged on their offer of an experimental license.
KELLER: You went into the auction at that time, right?
ROBBINS: Yes, and when we did that we also said, "Well, look, let's hedge our bet here by taking a piece of the parent." So we took 15% of the PCS start up in Kansas City with Sprint Corp. and that's turned out to be a very valuable investment for us.
KELLER: And it will continue to be, I'm sure.
ROBBINS: I think so too.
KELLER: Now, you have always had various partners in various businesses that you've been in, even to go back to what made you a very formidable opponent in the franchising efforts, when you used to go in and get the local newspaper as a partner with you. If they weren't your newspaper at least you did know somebody, you knew the editor or publisher, whoever it would be and you'd bring him to the table during the franchising process, which I thought was a tough, tough competition for us. You won many of them on that and you're still bringing in outside partners into a lot of your businesses at this time.
ROBBINS: Part of that is done out of necessity because we have always been of a size where by getting together with other people our size or maybe a little smaller or maybe a little bigger, we were able to aggregate enough either homes passed or customers or whatever to give somebody who wanted to use our pipes a lot more scale. That turned out to be the case with Discovery. We got together with TCI and with Newhouse and that's certainly turned out to be the case with Teleport and it turned out to be the case with Sprint PCS and I want to know what the next one is going to be because those have all been wonderful value creation opportunities for us.
KELLER: Do you see yourself in those investments over the long term or do you think you'll buy some of the companies out or they'll buy you out? I know you can't say which is going to be what, but...
ROBBINS: Well, I can tell you historically, we've taken our... well, first of all, Teleport was sold to AT&T. We got AT&T stock for that sale, we took that AT&T stock and traded it for some cable television systems including Baton Rouge and Tulsa, Oklahoma, which fit into our clustering strategy very nicely. On the Sprint PCS stock, we still have 4 ½, 5 billion dollars of that on our balance sheet today and it becomes a more valuable asset everyday.
KELLER: I think it will continue to be too.
ROBBINS: I hope so. Discovery, I think we think, is a core holding. It has now come to be regarded in the Cox family as one of the crown jewels and we love the programming, we love the management and I don't think you'll see us to anything with that. We'd love to get more of that and we had a chance to buy more of it when United Cable sold their interest and we declined and John Malone, with his vision, just scooped it up.
KELLER: Hearst is in that too, isn't it?
ROBBINS: No, Newhouse.
KELLER: Newhouse, okay.
KELLER: Hearst is in some of the others – the History Channel.
ROBBINS: Yes, Hearst is in History Channel, I think Hearst is in Lifetime and some of the others.
KELLER: I thought maybe they were also in Discovery but apparently I was wrong. In your current operations in telephony and Internet data services that you're starting or has been started for some time in Omaha, Phoenix and southern California, how are you doing?
ROBBINS: I think we're doing great. These are new businesses, they require a lot of care and feeding. We've invested a lot of capital, probably more capital than any other company in the industry but the overarching objective is to put a bundle of services in your house and have those services stick by offering you nice discounts against an array of ala carte competitors and today, Jim, what's driving this is the need on the part of our consumers to have more control over their time. I'll give you a stretched example, but if it takes me 10 people to get video, voice, and data hooked up into your house and I bring them all in at 8:00 in the morning and they're all gone at 9:00 in morning, that's a great use of your time. It's not a great use of all of my labor but the flip side of it, and this is the nightmare scenario that I worry about, is Monday the cable guy calls, Tuesday the digital television guy calls, Wednesday the phone guy calls, Thursday the data guy calls, and you might as well be dealing with four different companies. That is not the business model that makes sense. The business model that makes sense is we come to your house once, you get very comfortable with us and what we're doing and that relationship so that when you have to write us $100 check every month, it's not a big deal. This is a company that's doing a good job for you and saving you time and making your life more productive. That's what this thing is all about.
KELLER: I think you heard Charlie Armstrong with AT&T in Chicago, was that two years or three years ago?
ROBBINS: Mike Armstrong.
KELLER: Mike Armstrong – state that that was his intent also within his systems and then he went a step farther in talking about the potential of a single, some kind of instrument that would accept all of these services and be able to show all of these services. Do you see that in the forefront also?
ROBBINS: I don't know what you mean by a single instrument.
KELLER: It would be an instrument that would combine a computer screen, a telephone instrument, television set and so on in a single, I don't want to use the word platform, but in a single location, in a single piece of equipment in which all of these services can function.
ROBBINS: Maybe, although I don't see long form video being viewed on a small screen and I'm not sure I see, maybe there's a better possibility, albeit not a very high one, of doing a lot of text on a big screen interactively. What I'm talking about there is a computer experience, a high speed data experience that you would have today taking place over a big screen television. I think we're going to have discreet and separate human behaviors – the lean back experience and the lean forward experience. There's going to be some blending.
KELLER: That's an interesting way of putting it.
ROBBINS: And I think one of the fascinating opportunities for the industry today is to bring those people who do not have an online experience at their desktop today, to bring them into that experience through the television and migrate them, upsell them if you will, into being a high speed Internet access customer. I think that's a huge opportunity. The TV set is on 7 hours a day today in the average American household, the computer is being used 1 or 2 hours and what better opportunity to lead people to a computer experience through the television set.
KELLER: I've always agreed that the television set could act as the monitor for your computer service. I don't think there's any doubt about that occurring.
KELLER: You've gone into both switched telephony and Internet services in your various operations, which again has been a little bit different than some of the other companies, either one or the other. Comcast, as an example, has decided that they're going to go into the Internet services and stayed pretty much away from switch services.
ROBBINS: Well, they haven't done any telephone to speak of, they had done digital, which is an extension of their video product and they're doing a lot of high speed data service right now. For us, we have over a million customer right now that are taking one of the three new services, either digital television, high speed Internet access or telephone and we're adding to that customer base at a rate of 17,000-18,000 a week and all that does is leverage our platform, leverage the customer relationship that we have, leverage the people, the managerial resources and customer contact resources that we have across the company and I think that makes an enormous amount of sense. It's proven to be the right strategy even though we missed our numbers two weeks ago by three million dollars and Wall Street killed us. It is the right long term investment.
KELLER: I tend to agree. How many are taking all three services?
ROBBINS: I honestly don't know the answer to that.
KELLER: Is there a large percentage or a small percentage?
ROBBINS: No, I think most of our customers are taking a two service combinations: core cable plus data and digital, for example. Most of them are taking that, some are taking only one and there are some that are taking all three services and of course our job is migrate them up to three services so that, again, they'll feel very comfortable doing business with us.
KELLER: Are you bringing it into their present telephone instrument?
ROBBINS: Yes, and we use their home wire.
KELLER: The segue into this whole thing then is going back to the '84 Cable Act, which was a great boon to the industry and then the '92 Act and then the '96, which is a progression all the way through. The '92 hurt the industry tremendously from a dollar and cents standpoint.
ROBBINS: Yes, yes.
KELLER: Most everybody survived and in fact some of them bought out a lot of their limited partners on that basis too, in '92, but you were involved as chairman of the NCTA in '91 and putting the final touches on whatever agreement was going to be made when we re-regulated it.
ROBBINS: Yes and no. At that point the board of the NCTA, and I was chairman at that time, was really quite hands off. We had a long seasoned, experienced executive in Jim Mooney, who was running the NCTA, and I think in the final analysis we as an industry got caught up in our shorts a little bit. I think Jim took a hard line, I think the industry supported him on that, some of the individual companies, including one that you used to work for – you worked for bunch of them so that could be anybody...
KELLER: It was ATC.
ROBBINS: They also took a hard line and the net net of all that was we may have overplayed our hand by the time '92 rolled around and the industry was re-regulated. We may have brought some of that on ourselves by taking too hard a line.
KELLER: I don't think there's any question about it, especially in view of the Tennessee experience, which granted was anecdotal, it was very limited in scope, but nonetheless, it was a very powerful guy.
ROBBINS: It was from a "Johnny come lately" into the industry who was a financial player, I'll never forget him as long as I live, and we got screwed because, the whole industry got screwed because of the behavior of one individual.
KELLER: That's right, that's right. He was really going to lay it to them and get his money out in a hurry.
ROBBINS: You bet. He took us all down.
KELLER: And Al Gore got a hold of it and ran with it.
ROBBINS: And only history will know as to whether that good man's going to make it to the White House on the backs of cable television or not.
KELLER: Well, he's got a good start, we'll put it that way, toward it. But then the '96 Act, actually '84 was very good for us, '96 I think is yet to be determined how it's going to effect the overall industry and then profusion of services that are going to come together because of the '96 Act. It permits us to do all of these services, first of all.
ROBBINS: The '96 Act is a terrific boon to this industry, there is no question about that.
KELLER: And the telephone company was the one that wanted it in the worst way.
ROBBINS: Yes, it was a little bit of an irony on that one.
KELLER: A big irony.
ROBBINS: We had great leadership in Washington. Jim Mooney decided it was time for him to move on and we were very fortunate in having standing in the wings Decker Anstrom, who I think did a wonderful job bringing together the somewhat dispirited industry culmination of the '96 Telecomm Act.
KELLER: It was a confused industry, I think, then in the mid-'90s.
ROBBINS: Well, we'd been wumped by Reed Hunt, he'd taken our rates down, he'd caused all sorts of chaos on Wall Street for the public companies and it was not a time when people were investing aggressively in this business, which is what's going on now. I think it's fair to say that left alone, this industry will continue to invest heavily and toward the end of making peoples' lives easier and more productive.
KELLER: So you feel that those companies that are going to remain, and now we're going to put it in quotes, "cable television" because it's really not per se cable television anymore, it's a whole broadband communications service.
ROBBINS: We changed our name when we acquired the Times Mirror cable properties in 1995 to Cox Communications from Cox Cable and I think that says it all.
KELLER: I think so and I think there's no questions about it and so you really can't talk about the future of cable television, you've got to about the future of the telecommunications industry.
ROBBINS: Or broadband communications or whatever you want to call it, yes.
KELLER: But another term for it. There are going to be some major players in the business, as history tells us, we're going to end up with four or five major companies in the business over the next ten or twenty years. Do you see Cox being one of those players?
ROBBINS: I do. The Cox family loves this asset and I think as families in America go, no family has more invested in this business than the Cox family.
KELLER: I think that's true.
ROBBINS: There's no questions that it's true if you take 65% of Cox Communications with a market cap today after getting beaten up, it's somewhere in the 20-25 billion, 65% of that is 16, 17, 18 billion if my math is right, there's no other family in America that's got that much of their resources tied up in this business.
KELLER: How do you see the merging of, say, a Microsoft into the industry, or Paul Allen or someone else bringing this computerized background into the industry? How do you see that working?
ROBBINS: I think that's good. I think the industry's got to get away from its paradigm that's been around. It has to morph itself on to new technologies, new players, all the time. I think as quickly as you say that you also have to quickly beware of where Microsoft wants to wind up. They want to be the guy that is the toll collector for everything that you do and that's not in our best interests.
KELLER: The telephone company wanted to be that at one time too, including owning the instruments into the home and so on. Our industry, the cable industry, at that time wanted to be the same way, insisting that we own the converters as opposed to allowing it to be bought in retail and so on. We all went through that battle.
ROBBINS: And I don't think that's all bad. It gives you an opportunity to forward integrate.
KELLER: I didn't say it was bad, I'm saying it is a merging function of all services into the home.
ROBBINS: No question. No question, and there are going to be more services and more software applications and things like that that are going to go on.
KELLER: Do you see the competition between over the air services and broadband services going in what direction?
ROBBINS: I think it's going to be harder and harder and harder and I say this with a certain amount of remorse because the prophets from Cox Broadcasting allowed Cox Communications to grow, but I think it's going to be harder and harder and harder to sustain the economic paradigm that you have in broadcasting for a long, long, long time.
KELLER: They're finally going to recognize what business they're in?
ROBBINS: Well, maybe, maybe not, I don't know whether that's the right...
KELLER: Well, it's always been peeve of mine. It's like newspaper work the same way, they're not in the printing business, they're in the news producing business. The same way in broadcasting, they're not in the distribution business, they're in the programming business.
ROBBINS: Right, right.
KELLER: A lot of times those old timers never realize that in both industries.
ROBBINS: I think that's true and I just don't know – there's still an opportunity to get a mass market and advertisers are going to pay dearly for that but as you proliferate to all of the analog sites and all of the digital channels and now the Internet and streaming video on the Internet, it seems to me that the demand for broadcasting, as it's presently known, has got to go down. Some events like the Olympics this fall, no, but it worries me longer term. The future of that business.
KELLER: In what way does it worry you?
ROBBINS: I just don't know that the current economic model with very expensive programming, one, two, three hundred thousand dollars for a half an hour episode, I don't know whether that model is sustainable.
KELLER: I'm not sure it is either. Had Cox, other than through your investments in some of the programming services in cable, have they tended to move into the programming services from a broadcasting side?
ROBBINS: No, in fact just the opposite. We had an investment in Reischer Entertainment in the broadcast operation and we didn't feel comfortable with that and we got out of that in the last couple years. I think if anything we would pick up more stations and particularly stations in clusters. We've just done a deal that was announced in the last couple of weeks where we picked up Steubenville and one other NBC affiliate not so far from Pittsburgh, so now all of the sudden we have Pittsburgh, Steubenville, and we have one other community and we really blanket an entire region with the NBC affiliation.
KELLER: Almost like translators, huh?
ROBBINS: Yeah, yeah, it is in some respects.
KELLER: And you share programming, newscasts, and so on with the stations?
ROBBINS: I guess so, I don't know. We certainly share the back office stuff and you've got to make some sense over that.
KELLER: Tell me how your NOC works, your National Operations Center. It's amazing to me that you can monitor an amplifier in Las Vegas from a central location.
ROBBINS: That tells you something about how the telcomm costs have come down so much over the years. It's as simple as that. It's like being at AT&T's network operations center in Bedminster, New Jersey. We monitor all of our amplifiers. When you're in the phone business and the 911 business, you've got to be at that kind of state of readiness and we're running 99.93% tight network, which again is a great credit to Alex Best and the engineering standards that he established for it.
KELLER: And you also use it for customer service, don't you? You know what each operation is doing from a customer service standpoint?
KELLER: Truly amazing from a centralized, what's being done... TCI tried to do it from a billing and reporting situation from their operation center in Denver but not, I don't think, to the extent that you are using it.
ROBBINS: Well, we've got big customer service centers and operation centers around the country. So, just because we've got a NOC here doesn't mean that we haven't got somebody out in Orange County looking over the same thing. It may not be the most efficient and we're trying to sort that one out as we go.
KELLER: How far from the early days of the business when the only way we knew there was an outage was when a customer called in and said, "Hey, I've got no picture." And then we called the guys out. It's amazing, just absolutely amazing. You made major acquisitions during 1999 and early 2000 to media general, TCA, multimedia and then bought the Baton Rouge and the Tulsa systems.
ROBBINS: We traded them for AT&T stock. Jim that was pretty straightforward. In '95 we did Times Mirror, we felt very strongly we had to grow or get out of the business. Last year we felt the same thing. A bunch of nice properties that fitted well with us were coming in to the market and we just sprung for them and I think that was sort of another defining moment for this company.
KELLER: They made the decision they were going to move ahead.
ROBBINS: Yeah, we had to either get bigger or we had to get out of the business.
KELLER: Was that a battle on the board?
ROBBINS: Nope, not at all. Jim Kennedy, my boss since 1987 has been just a huge steadfast supporter of what we have done and it's turned out to be a wonderful decision for him because we've added an enormous amount of value to Cox Enterprises. When I came here, Cox Communications was somewhere between 20 and 25% of the family's assets. Today we represent about 53% of the family's... well, probably not today with the stock market the way it is.
KELLER: Including revenue?
ROBBINS: Yeah, but I'm really talking about evaluations. We're probably close to 50% of the Cox family holdings.
KELLER: Even with all the television stations and the newspapers, you're still more than half?
ROBBINS: Yes, yes.
KELLER: Have you learned anything from the experiences that Henry Harris or Bob Wright had preceding you? Those two come to mind more so than some of the others that were here, but those two were dynamos in business.
ROBBINS: I will tell you, with all due respect to Bob, who I think has done a fabulous job at NBC, I had some cleaning up to do because I think his game was to go out and get franchises no matter what the cost. We had some that were so costly we couldn't hang onto them.
KELLER: Well, that was in the era, though, when you couldn't provide any service, wasn't it, for some of those franchise markets?
ROBBINS: That's true and we went out and committed all sorts of things in some of these franchises that there was no way you were ever going to make a nickel on them. Henry, I think, represented very strong financial discipline in the company and hopefully that discipline continues today. I see him around here in Atlanta, I haven't seen him in a couple years but he's just a wonderful, happy guy.
KELLER: We haven't interviewed him yet and I fully intend to.
ROBBINS: Yeah, you should.
KELLER: There's no doubt that he will be interviewed, there's no doubt about it. The present industry standards: do you feel that Cox is really setting the basic standards for customer service in the integrity of the network and so on within the industry?
ROBBINS: I think we are in that respect. I don't pretend that at 6 million customers that we can set any standard about anything in this industry but we can generate some thought leadership and we can influence some of the thinking and where we have an expertise we try and do that. You've mentioned two of them: customer service and technical standards.
KELLER: Do you still serve on the board? As past chairman you still serve on the NCTA board?
ROBBINS: Yes, yes.
KELLER: And you still serve on the Kaitz Foundation?
ROBBINS: I'm still on the Kaitz Foundation board and I think some past position, I don't know if I got an official position but I guess by virtue of our size and anymore people will tell you you can have the industry around a dinner table and get all your programming deals done, but I still feel very strongly in what Cable in the Classroom does.
KELLER: Talk about that, will you please?
ROBBINS: And C-SPAN.
KELLER: Well, C-SPAN we've already interviewed Brian Lamb, but I'd like to talk about Cable in the Classroom that you head right now. How did you get involved in it and what are you currently doing?
ROBBINS: Well, I'll tell you, that in some respects, Jim, goes back to my days at Continental where I think Bud Hostetter felt very strongly about giving back to the communities that gave to him and that combined with a huge sense of fear that our educational system in this country wasn't keeping up. I've been to Japan and I've seen kids in July in uniform going to school and I'm saying to myself, "Wait a minute, this is summertime, these kids don't get any break. What's happening here?" And if you just look around the world from a competitive standpoint, I think a lot of American success hinges on education, but I worry that for whatever reasons we're losing the worldwide competitive advantage to people who are really focused much harder on education. So that sort of backdrop philosophy combined with what I think is the power of video led me to be an early and ardent supporter of Cable in the Classroom and that organization is evolving now from an organization that was able to bring programming to classrooms to a teacher training organization and I think now because of the composition of the industry, the industrial players, i.e. Cox or AT&T or Time Warner, they have got to do that job in the communities that they serve. It must fall to those because Cable in the Classroom, with a very small staff, can only support so many teacher training initiatives and then it's got to sprinkle on down the line. I think the companies have really got to take the responsibility for that, so Cable in the Classroom is now evolving into something that I think will bring nice credit to the industry from a political and public affairs perspective and should.
KELLER: Very much so.
ROBBINS: And I think its role... but its role is changing. It's probably going to do less hands on training and more advocacy, if you will, for educational support for our industry, for infrastructure of software, and so forth.
KELLER: I'm absolutely abhorred by the fact that most people don't know, and many of the textbooks don't even have such things as some of the very stalwarts of our history. They keep Thomas Jefferson in there, but only in sometimes in a negative way, that he was a slave owner and that was about all, never the great things that he did. The mid-history of our country with the exception, perhaps, of the Civil War are virtually lost on most of our college students. Most of them don't even know the Second World War. I'm abhorred by it, so I understand what you're saying.
ROBBINS: Well, I just think that it's very clear and I will tell you from a standpoint of sitting in this chair today, the hardest job I have is making sure we get and keep and train the people we need to keep up with the demand for the services that our customers are calling for and part of that has to do with the very robust economy that we're operating in, part of it has to do with the seemingly endless amount of venture money supporting start-ups, and frankly a lot of the experience that we have inside of this company is attractive to people who are doing telecomm start-ups, doing dot com start-ups, so I think it's doubly tough in the sector in which we operate and that just reinforces even to a greater degree my notion of support for Cable in the Classroom. I think it and the Kaitz Foundation, and you have to say in the same breath, C-SPAN, are three absolute crown jewels in our industry. C-SPAN is well known, the other two are not and one of the reasons to try and shift focus a little bit for Cable in the Classroom is to try and get some recognition that in fact, what everybody thinks of as ugly monopolists taking $35 a month from poor Joe six-pack, we do an awful lot of good things and if you see Johnny making his computer dance because he's got a high-speed connection and his teacher learned how to learn his connection and taught him, by God, that is advancing the competitiveness of America.
KELLER: Are you providing television sets or computers to any of the classrooms at this point?
ROBBINS: Some markets we have provided computers. We absolutely provide an Internet connection, we absolutely provide Cable in the Classroom programming in all the schools that we serve and in many of our systems we have educational coordinators that basically try and be the linkage between the classroom teacher and the programmer on how to use all this great stuff. You know there is fabulous stuff on the air but most people don't know how to use it, don't know how to access it.
KELLER: And also even some of our channels, the Discovery Channel, the History Channel...
ROBBINS: Discovery Channel, History Channel, Arts & Entertainment, Bravo, you name it - The Learning Channel - there are just tons of them. I wish I watched more television. I don't watch a lot of television.
KELLER: I watch the ballgame or I'll turn on the History Channel, that's about it.
ROBBINS: Or I'll go chase the news, CNBC, early in the morning when I get up, but I'd love to sit down and look at Biography every night. I think it's a great concept. I can't sing Nick Davatzes's praises enough in terms of what he's done for this industry.
KELLER: No question. You know, when you say what these various channels have done for the industry, I made the mistake of saying to Brian Lamb that C-SPAN was a great public relations venture for the industry and he almost went right through the ceiling because he just... and it is, it was, he can't deny it.
KELLER: He said it wasn't meant to be, it just happened to be and that was not the intent.
ROBBINS: But that thing has got great substance, just tremendous substance and the public relations elements of that were secondary. I wish we got the same public relations benefit out of Cable in the Classroom and also out of Walter Kaitz Foundation. You wanted to go there in our conversation. We've got a very simple philosophy around here that if you're not reflecting the marketplace that you serve with those same kinds of faces in your ranks at all levels, then you are not taking advantage of the business opportunity that's there. If, for example, in New Orleans our customer base is probably 50, 60, 70 per cent African American and our ranks there reflect the same thing and that's good because I don't think I, as a white male, understand what goes through in a purchasing decision of an African American family or in Southern California or Phoenix or Tucson or wherever else, the Hispanic family. So we need to reflect that all the way around. The Kaitz Foundation, in good years and bad, allows us to do that. It's a fabulous legacy to Walter Kaitz and the fact that Spencer and his wife and his mother have been so steadfast.
KELLER: I was on the board from '81 through '86, a long time ago, but nonetheless. We were fighting battles then as to which way we were going to go, how we were going to handle it, how many interns we should have each year, whether we could afford to do it and so on. It was a long battle.
ROBBINS: Absolutely. And the recruiting effectiveness has changed over the years but I don't know of any other industry, Jim, that has something like the Kaitz Foundation. The dinner that they throw every year, that's an evergreen. It's a million five, a million seven, two million dollars that they raise. I mean, that's extraordinary that so many people would coalesce and maybe they go there because the investment banks feel that if they don't sign up for a table there they'll be left out or something. Whatever it is, but it's pushing the passion of Walter Kaitz, which I think is a super asset to this industry and one that we haven't got anywhere near the credit that we should.
KELLER: Explain the purpose of the Kaitz Foundation.
ROBBINS: It's really, in my judgment, to bring minorities into the managerial ranks of the industry.
KELLER: And women, at least it started off to be women.
ROBBINS: Well, when I say minorities, I mean minorities by gender, minorities by sex, and I don't think we've got as much of an issue with women in this industry...
KELLER: Not any more.
ROBBINS: ... as we do with minorities by race and that's where the NAACP is starting to pick at us a little bit and a little of that helps us a lot to really focus on what we should be doing and I'm very proud of the work that Cox has done in this area. I'm not proud of the grade that we got from the NAACP. We, like a bunch of other companies, were sort of in the middle of the pack.
KELLER: I wasn't aware that there was grading.
ROBBINS: Yeah, I think the industry got graded from B- to F, or something like that.
KELLER: By company or by system?
ROBBINS: By company and unfortunately part of this is a little bit of fundraising going on at the NAACP. I'd rather be straight up and say, hey, if you've got a request you want, let's talk about it but let's not go do a dipstick and you're bad and the way you get out of the bad box is to gift some corporate resources to the NAACP. My take is we need as a company to reflect the markets that we serve and that's what hopefully this company is doing and I hope the rest of the industry is doing.
KELLER: I would hope that would be the case but unfortunately I don't think it is, as of today.
ROBBINS: I don't think it is either.
KELLER: Do you see the Kaitz Foundation continuing to bring in educated minorities into the business because I think now they've set a standard at which the interns can be – they have to have some work experience and some educational background before they can do this.
ROBBINS: Oh yes, oh yes.
KELLER: At one time that was not the case.
ROBBINS: Yes, absolutely, and I think the pool is bigger than it's ever been because more people have been able to go to college one was or another. Absolutely I do. In fact, I've got a phone call this afternoon with John Goddard and Spencer Kaitz on a new chief executive officer for the Kaitz Foundation and I'm looking forward to that call.
KELLER: They've had some good executive directors of that foundation who have worked awfully hard and of course Spencer is the keystone of the whole thing.
ROBBINS: He's the godfather who has been there through thick and thin, absolutely.
KELLER: As his father was in the early days of the industry right on through. He fought some of the battles in California that they won before they ever got to the national scene. It was just amazing.
KELLER: Where do you see, philosophically do you see Cox moving on into the future?
ROBBINS: Jim, we're at 6 million customers. The Cox family loves the business, we have a lot of financial capacity if we want to use it. We could get a lot bigger if we wanted to. Right now our concentration is on executing against the bundled opportunity and that will take another two or three years. Of course you can never predict the timing on when big opportunities come along.
KELLER: Are you constrained by a debt/equity ration basis?
ROBBINS: Not really. Our debt is somewhere between four and five times. We're not overly leveraged; we're adequately leveraged. Where we're spending our money today is making sure that once we put these new services in we do a good job and that's costing us a little on our cash flow line and that hurts because we put a lot of capital in the ground. Wall Street wants to see bigger and better returns and they want to see them instantaneously. Well, when you're rolling telephone across the country, that takes some time to get in place.
KELLER: If you don't do it, the Internet services are going to because they're digging up every city in the country right now.
ROBBINS: Absolutely, and these are all opportunities for us to lose. We are beautifully positioned, have a wonderful pipe and relationship to the customer and again, we were talking this morning about in home networking: you get one or two or three computers in your house, plus a television, plus telephone and there is a terrific opportunity for some company to be the first phone call to fix any problems that you may have.
KELLER: Can you do that right now in your systems?
ROBBINS: Can do, we're not doing it. We're not concentrating on that.
KELLER: You haven't got the trained people to be able to do it?
ROBBINS: Well, I'm so busy doing everything else that it's not an initiative we've started on, but we need to do that because otherwise somebody else is going to get into this relationship with the customer and that's not good for us long term.
KELLER: Do you see the capabilities of your chief technicians, your chief engineers in your major complexes changing their basic needs, their basic educational background from rather the transmission type of experience to something more?
ROBBINS: Yes and no. The average customer contact person has got to be more knowledgeable today, rather that person is on a telephone or rather that person is out in a truck in the field and that rise in skill set, I think, runs all the way up the organization. I must say I feel inadequate today about really understanding the Internet and what's going on there, but I didn't come up in that generation.
KELLER: I'm with you.
ROBBINS: So, I need to get a 35-year-old hotshot in our company that can help us figure out what the opportunities are there. Just to go back to your other question about what does Cox look like in the future – we're going to push more and more of these new services down the pipe and we think by leveraging that platform, leveraging our customer relationships, leveraging our management and leveraging our clustering, we think that's a great strategy that should be able to give us a double in the size of the company every five years.
KELLER: I don't want to sound like a Wall Street analyst, but is that going to have a major impact on your cash flow and on your earnings?
ROBBINS: Oh, yeah. I think 50% of our cash flow in five years will come from other than traditional video services.
KELLER: But in the interim though, it's going to have a negative effect, isn't it?
ROBBINS: In the interim, laying on these new services costs money, absolutely.
KELLER: And you're willing and the company's willing to take that...
ROBBINS: My boss is very clear about let's take the long term view and you know, it's tough when quarter to quarter Wall Street wants you to show just never ending increases in your cash flow.
KELLER: how often do you tell them about your plans?
ROBBINS: Wall Street? We talk to them a lot and you can get caught up in their rhetoric, which they all want double digit cash flow every quarter, whatever. Well, they don't understand that you've got to invest and some of the additional marketing and effort to get these new services rolled out is going to cost you in the current quarter and you won't see the revenue impact for a couple of quarters later so it's a balancing act that we've got to work our way through.
KELLER: I think many of the analysts were so bound up by the utility concept where if you made an investment of x number of dollars, you immediately had x return on that investment, that is the telephone companies, power companies and so on.
ROBBINS: Yep, yep, guaranteed rate of return.
KELLER: And we don't have that and fortunately we never wanted it.
ROBBINS: Always risk capital in our business.
KELLER: Always, from day one.
ROBBINS: Yes, absolutely.
KELLER: That's one of the advantages of growing up in small towns and burgeoning from there as we have been.
ROBBINS: Yeah, yeah.
KELLER: Jim, is there anything else you'd like to add before we wrap this up? It's been a delight speaking with you. Do you want to put a tag on it?
ROBBINS: Well, my only finishing comment would be I think that if this company is remembered for one thing, maybe it is remembered for it's customer service. Yes, we do a lot in the community but other companies do that. I do think that we have defined what customer service is all about in this business and we continue to define it every day and frankly I think that's a great long term business proposition for the industry.
KELLER: I'll go back to a comment I made earlier about the Cox reputation about being management, customer service, and community service. It still is a major, major factor within the entire industry, whatever that industry is today, whatever you want to call it.
ROBBINS: Well, we hope we have a little bit of thought leadership in those areas and as we get new players in the business and different players in the business, we hope some of the stuff that has brought us to the position of greatness that I think we've arrived at - not to get fat and happy - but we've arrived at will rub off on some of the other new guys coming into the business.
KELLER: I don't think there's any question. Jim, we appreciate it. This oral history has been provided by a grant from the Gustave Hauser Foundation and is part of the oral history program of The Cable Center. Again, the date is August 8, 2000. We're in the offices of Cox Communications in Atlanta, Georgia. Again, Jim, thank you very much for you time. What a pleasure.
ROBBINS: Jim, thank you very much. Fun being with you for an hour and a half.
KELLER: It was fun.