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tv   The Great Disrupters Businessweek Anniversary  Bloomberg  October 31, 2015 4:00am-5:01am EDT

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♪ >> it clearly had an impact on the way people began to think about economic policy. >> i was totally aware that a revolution was starting. >> if we did nothing else, we changed the world. howard: this is how i tasted my first cup of coffee. steve: boy, this is the first time in years. >> oh. [laughter] >> ooh. >> stand by, ready, take three. david: knowing for sure whether it was going to work, no. but what a grand experiment.
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>> take one. arthur: my name is arthur laffer. i am an economist. i live in nashville, tennessee. and we are here in washington, d.c. at the w hotel. ♪ arthur: i was in the omb. i was the chief economist at the omb then. i found my friends up there in the omb really boring. so, i always came down and hung out with the oao people. bill bradley was in that group, and christine todd whitman, and jim leach -- >> they were interns, as i recall. arthur: yeah, interns. it was just a fun group of people. don: art laffer, dick cheney, and i would have dinner from
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time to time, or lunch from time to time, or just have meetings in the white house from time to time. dick: in 1974, we came to the hotel washington to the two continents restaurant. that's where we sat down and talked about tax policy. and art drew the laffer curve. arthur: i invited jude wanniski, who was a writer for "the wall street journal" at the time. he passed on. but he kept all the records of this stuff. and in an article much later, it was called "taxes, revenues, and the 'laffer curve'." he recounted this dinner. so it was the four of us. and that is the dinner we are talking about today. dick: during that time, what we were trying to do obviously was manage the transition from the nixon administration to the ford administration. there had never been anything like it. don: and the country was faced with some serious economic problems. what was coming up through the system was not what i felt represented the direction the country should go. and it was in large measure coming from -- i think it's safe to say -- from speechwriters as opposed to economists. >> we were spending a lot of time on the economic program.
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>> my gosh. >> we were still doing it at vail at christmas time. don: i remember that very well. we spent a lot of time in ski clothes in the living room of the house that ford was renting. dick: and the bath house. arthur: gerry ford was proposing a tax increase. a 5% tax surcharge. so i was talking with don, back then he was chief of staff. and dick, who was deputy chief of staff. i said, look here, guys, you are not going to get 5% more revenue with a 5% tax surcharge. you may get 4% more revenue, you may get 3% -- you might also lose revenue because the tax base will shrink. i drew that little curve on the napkin to illustrate that. dick: that is one of those events that stuck out in my mind. it is not every day you see somebody whip out a sharpie and mark up the cloth napkin at the dinner table. he was that way. he drew on a lot of napkins. don: my recollection was we were
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in the restaurant, downstairs. sitting at a table about like this. and you drew the curve on the napkin. i was struck by it when you did it. i never got the napkin. >> but i have -- the napkin that was put in the smithsonian, the writing was, to don rumsfeld from arthur. why, if i did that, would don not have picked it up? [laughter] >> i didn't want that trash. arthur: i had to deal with this all the time. i do all of these mathematical models, of the effects of taxes. if you know the math, it works out pretty nicely. it doesn't have the bite, the flavor, of the real world. so i would develop all of these anecdotes to try to illustrate the economics, one of which was the laffer curve. you can tax people at 100%, no one will work, because they don't get the incentive to work, and the government will collect no revenues. if you tax people at 0%, everyone would work like mad, but you're not collecting any revenues. dick: basically the curve showed that with tax rates at zero, you would collect zero taxes. with a tax rate of 100%, you are going to collect zero revenue.
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you shut down the economy. don: it had the power of simplicity. it was a truth that could be expressed in a paragraph. we each turned to each other and said, arthur laffer is absolutely brilliant. [laughter] don: my memory is not perfect. i'm 82 years old. i could be wrong. ♪ dick: here's a question for you. when did reagan first see the laffer curve? arthur: well reagan -- i used to have, like with you don, i used to have lunch with reagan during the 1976 to 1980 period. he would come in -- just the two of us -- and he would come in with all these paper stacks, with paper clips, and ask me questions. marty anderson wrote in the book, "revolution." he remembered the day he saw it and understood it. he said i just saw the pres -- i don't remember that to be honest with you. i remember doing that with the president but -- politics is where the rubber hits the road. i am not held responsible for public policy.
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i'm this guy sitting at the dinner and i go home at night. they actually are held accountable. but they understood what i said. they understood the context in which it was done. then they had to take those ideas and blend them with politics and the real world. dick: it clearly had an impact on the way, at least on our side of the aisle, people began to think about economic policy and tax policy and revenues and growth. so it was -- for me, it was a significant moment in my own development, if i can put it in those terms. don: it was so simple and so compelling that the traditional liberal view was contested. the traditional conservative view of it was contested. arthur: it is not republican, it is not democrat, it is not liberal, it is not conservative, it is not left-wing, it is not right wing. it is economics. ok. vertical axis, horizontal axis, tax revenues. don: vertical is the tax rate. in case you forgot. [laughter] don: and the curve goes out like this. you may remember that. >> it is a bell curve. >> it's a bell curve, yeah. [laughter] arthur: here is 100% right here.
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this is at zero -- >> where is jude when we need him? arthur: jude should be here. it really is sad. because he did do it. he made all of this stuff really happen. it was amazing. this time, i will make this to my friend, dick cheney. [laughter] arthur: you got the first one and you gave it away, don. ♪ >> pardon me. >> you are saving it? dick: this time, i'm going to get the napkin. >> it is going to go to the cheney museum. don: old friends are the best friends. there is no question that we three have been friends for many, many decades. something, i suppose, exceeding 40 years, four decades. >> these are my two favorite people, as you can tell. don: as long as we agreed with him, he liked us. dick: don rumsfeld and i have been close friends for 40 years. he fundamentally changed my life, got me off the academic track and into politics and
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government. art is, as i say, one of the more interesting personalities around. so i had lunch and somebody else paid for it. >> what does it say? dick: that is classified. >> this game had never been seen in the wild before. i was just dying to see how people would adapt to it. ♪ >> the garage is a bit of a myth. it didn't serve much purpose, except it was something for us to feel that it was our home. we had no money. you have to work out of your home when you have no money. ♪ steve: boy, this is the first
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time in years. doing this all from memory. this is hard to remember in old computer language. ♪ steve: i not only designed this, every little metal trace that
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you see on here, i strapped onto a drafting table. i built this whole board myself because i wanted the chips in the ultimate, perfect position. i worked for a couple of weeks, every night until 4:00 in the morning, laying out the little things on a big drafting table that would eventually become this board. and when i got done, i realized i had to drill eight holes in the board. and i said, you know what, if i had only designed it a little differently, then i would have only had five holes. i tore apart my entire design, and for another two weeks every night until 4:00 in the morning, to get it just that perfect with five holes so you would never see the three missing. i had to be that artistically perfect to me, because it represents yourself when you do a great design. here's the first computer we ever built. long before we even started a company. i hand-wired the entire bottom, soldered it all together. that was the first apple i
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computer ever. >> does it get boring to tell the story? steve: never. >> it never gets boring? steve: never. it's in my heart. those were the most incredible times. the summer that i built the apple i computer, i was totally aware that a revolution was close to starting. i had been showing off my computer at the homebrew computer club. i had given away my designs for the apple i for free. steve jobs came into town. he would pop in to town, see what i was up to -- the latest thing i designed for fun -- and he somehow turned them into some money for both of us. paul terrell -- he owned a store in mountain view. he'd seen me for quite a long time, demonstrating my computer. so steve jobs went in to sell him some of our little boards that we had built for $20. he said, no. people want to come in, they want to buy it pre-built, they want to buy the thing ready to go. it cost us $250 to build, maybe. we would sell it for $500. the retail price was $666.66 because i, as a mathematician, like repeating digits and that's what it should be.
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the garage is a bit of a myth. it's overblown. the garage represents us better than anything else, but we did no designs there. we would drive the finished products to the garage, make them work, and then we would drive to the store that paid us cash. we outgrew the garage very quickly. it wasn't like a whole company, you walk in, a bunch of people have desks. there were hardly ever more than two people in the garage. mostly they were just sitting around doing nothing productive. i was very much a geek. i was a social outsider. i didn't look at the world in normal ways when i was young. i wanted my own computer my whole life. i had told my dad in high school, some day, i am going to own a big computer. ♪ steve: this board right here. the wires are not -- so i was happy -- once i had that apple i computer, i was
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happy for life. but the apple ii was the great machine that was going to turn the world on end. where is the case? the apple ii was -- i did the best genius work of my life, that i was well known for. for saving parts, for condensing things, for getting extra performance, for doing things people never imagined. ♪ steve: this is our millionth apple ii computer. and that is why it is gold. and a million sounds like a large number, but you remember number one. you remember number 100. this is number a million of the apple iis. that will probably seem small in a couple years. we had two phases. this garage was a little partnership with a partnership agreement. it was small stuff. the apple ii was the big company. we got an investment. once we had the investment, that is when steve's personality changed. he was going to be a businessman. he wasn't going to be joking anymore.
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he was going to be dressed in a suit on the cover of the magazines. that was his role in life. steve just felt like computers added up to companies that could make money. when we went public, yes, yeah, a few of us became unbelievably wealthy. we were worth so many millions and hundreds of millions. i designed these machines because i wanted computers for myself. i wanted to help revolutions happen. i did not really want that kind of wealth. ♪ steve: i don't remember the beep command, do i? too bad, i wrote it in my own language. ooh -- yeah, i got it right. run. it says,' hello, my name is steve.' you can barely see it, but it is there. soldering things together. putting the chips together. designing them. drawing them on drafting tables. it was so much a passion in my life. and to this day, i want to stay at the bottom of the org chart and be an engineer. because that is where i want to be.
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>> standby, ready. david: the notion then was, can we actually fill 24 hours a day with news? so far as knowing for sure whether it was going to work, no. but what a grand experiment. ♪ david: you hear 10 seconds,
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five seconds. and again, 5, 4 -- then they would shut up, and you would just see their fingers. and then you are on. literally, you're on. a certain aspect of your personality, if you get in this business, you have to be on to a certain degree. ♪ david: well, not quite the same. >> how many years did lois sit on your left? lois: many, many, many years.
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♪ lois: we met in about 1976 when we were both working at a tv station in sacramento. david: she was on one end of the newsroom and i was on the other end. and eventually, i spotted this really attractive, tall, leggy blonde. very good reporter, newscaster. and i remember remarking to a friend of mine, i said, i'm going to marry her. and i did marry her. lois: we married in 1979, about a year before we came to cnn. that was the sort of heyday of local anchors. there were no other options for watching tv, and so we had huge ratings. david: the notion then was can we actually fill 24 hours a day with news? so far as knowing for sure whether it was going to work, no. but what a grand experiment. >> standby, ready. take three.
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lois: 6:00 p.m., june 1, 1980. the first cable cast of cnn. david: and ted turner threw to cnn and the studio inside and now, i think he said, cnn news. david: good evening, i am david walker. lois: and i am lois hart. now here's the news. president carter has arrived -- david: we found out we were going to be the anchors of that newscast about, what, three or four days before that? lois: probably. david: it was like, wow. we swallowed hard. we were told the reason we were selected, ted just, for whatever reason -- lois: ted -- david: he just liked our style. lois: ted was the one who made the choice. david: whatever we did on air, he thought we would best represent cnn at that time. so it was because of ted and quite an honor. ted: i dedicate the news channel for america. lois: ted turner is a visionary. very smart. a little crazy. brilliant businessman.
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brilliant, brilliant businessman. ♪ >> for the american people. david: when he created cnn, they did research. they said, don't do it. it's not going to work. it's a bad idea. you're gonna lose money. he rolled every cent -- he was a mississippi riverboat gambler -- he rolled every nickel he had into that operation. sure enough, it did work. >> skies over baghdad have been illuminated. david: first gulf war. when cnn had live reports coming out of baghdad. great visuals of the bombs going off and some terrific reporting going on. i think that is when the world and the nation, everyone said, that was a wow moment. ♪ lois: it is interesting that most of what people talk about when they are in the news is how fluffy and light news in general has gotten. the argument being they don't want hard news. and we are going to try softer
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programming. david: but that's -- i don't have a problem with that. that is part of a day. say out of 10 stories, you can have one or two that is of vital interest and importance. the rest of them are just fun to watch and amusing. lois: cnn has provided a product over the years that the world would never have gotten any other way, which is a window to the world, really. that wouldn't have happened -- and wouldn't have driven all the rest of the cable networks to even be born. ♪ lee: there was a moment in time when the board was trying to pull the plug on all the funds and have it not run. steve was there with wozniak. and he said, well, i will pay for half of it if you will. ♪
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if something, like this scary storm, takes it offline. so i can rest easy. what. you don't have a desk bed? don't be left in the dark. get proactive alerts 24/7. comcast business. built for business. >> on december 5, 1973 -- lee: the super bowl was always the venue for a huge audience.
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but master lock was the only one that did something exclusively for the super bowl until we did "1984." what makes something memorable? i think the challenge has always been to break rules, find something new, find something unexpected as a way of engaging people and telling the story. i met steve when he was 24 years old. steve, from the day i met him, was passionate and believed totally that this technology was not going to be a business for him and was not going to be just a hobby for wozniak. this was going to change the world. steve: today, one year after lisa, we are introducing the third industry milestone product. macintosh.
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lee: so there was this challenge from steve, i've got to introduce macintosh. it has to be dramatic and famous. it's got to be different. we had a meeting where we presented a whole bunch of thinking that went into launching macintosh. he thought it was brave. he thought it was great. it was the board of directors, thinking it was really stupid and irresponsible. there was a moment in time when the board was trying to pull the plug on the funds and have it not run. he was there with wozniak and said, i will pay for half of it if you will. they did not have to come to that, but they did make that overture at one point. so you open on this place that represents the future with people marching to a central hall. our idea was that big brother represented the control of technology by the few.
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lots of people decided, partly by the bluish quality, partly by the competitive situation that apple found themselves in, that big brother represented ibm. that really wasn't the intent, but it probably worked on that level as well. but running down one of the corridors was a girl, who you saw glimpses of. she came bursting into the back of the room, and she stopped and swung once, twice, and then heaved the hammer. and, a giant explosion. narrator: and you will see why 1984 won't be like "1984." lee: 1984 was not designed to only run on the super bowl. it was designed to have a media life beyond the super bowl. but the board of directors at apple decided it was irresponsible, since it did not show the product and the product was not available yet, to continue running.
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and that becomes almost part of the legend. the genius of just running it once on the super bowl. game was ok, but did you see the commercials? it was more about how the world would change because of computers, not changing the super bowl. it did create a phenomenon where people started thinking and designing advertising specifically for the super bowl. they kept it a secret, and had it be a surprise. those thing for born out of 1984. trying to live up to what steve expected of what i did, and what we were doing together became a true kind of joy. to be in the advertising business, he don't often get to be part of something that important. that world changing.
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lots of people misjudge what the commercial was, what it could do. nobody believed that 30 years later, we would still be talking about it. in many areasblem is a deficiency. >> if we get people to use this salt, we will be ahead. it will change their life. ♪
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esther: i was always troubled by poverty, troubled by the different circumstances that people experience in the world. troubled by the fact that some people are poor while i am living this comfortably middle-class existence in france. it was only much later that i understand that economics could
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be a tool into this understanding. i am interested in how poor people make decisions about their lives. the understanding of these decisions can help us design programs and intervention that help them to lead a better life. duflo: there is obviously a lot of poverty in the world. but there is also a lot of aid. so why aren't there more results? esther: now a lot of money is being spent on the poor. what is the effectiveness of that money? is it well spent? is it not well spent? that is what we are trying to find out now. duflo: part of the problem of aid is that the natural tendency is not to be too scientific about it. what happens, really, if you give them a handout? is it really that awful stuff that happens, or basically, it helps them a little bit and makes them happier? one of the advantages of doing the kind of work we do is we can start to put a wedge between those. we can start to say, that is not true. there are some places where we do know the facts. and you can't just tell me that anything goes.
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and i think that is a long way down the road towards getting more science into this decision. esther: my mother is a pediatrician. and currently today, as we speak, she is in el salvador in a mission with doctors of the world. and she was doing this while we were growing up. i grew up with a strong notion of responsibility to at least not ignore that issue. and then on the other side, my dad is an academic. he is a mathematician, you know, and i kind of always hoped i would be an academic, too. when i got into the profession, this little more than 15 years ago now, we did not have many answers, so it was a very exciting, wide-open place to start working. i was able to go slowly, slowly, to take one question after another and ask other people. of course, many, many more people are also doing that. and together, i think we are
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starting to make some progress. duflo: it is literally very similar. in some ways, even though she grew up in france and i grew up in calcutta, we have very similar backgrounds. j-pal was created to catalyze this process of knowledge building through doing the experiments. esther: it was started at m.i.t. and then very closely after, we started the office here in india. and then now we have offices in every continent except oceania. duflo: we wanted to do randomized controlled trials on issues that are relating to poverty. esther: the concept is very similar to a clinical trial. you take a definition of people. randomly select half of your population. give them the new drug. the other half gets the standard of care or a placebo. because they have been randomly selected, they look exactly the same.
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you can compare them and get a very good answer on the effectiveness of your drug. you can do the same for any social program. it gives you a very good sense of the effect of the intervention. duflo: usually i will wander around and try to listen in on the surveys, because the one useful thing you can do is sort of figure out -- there is often a gap between what you think is the question and what is being asked. so when i listen to it, the way it is actually being worded is very important. esther: one key problem in many developing countries, but in particular in south asia, it is the high prevalence of iron deficiency anemia. so we thought, would it be possible to make double fortified food available in the villages at a reduced price? would people buy it? if they do, would that improve
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their health? duflo: if we just get people to use this salt, we are going to get a big step against anemia. it could improve test scores, improve work performance, improve incomes, all kinds of great things, they will really change. our attitude towards this problem is to turn it into a solvable problem. esther: there are many factors in the world. there is governments, ngo's, private companies. who recognize, from having worked in the field, in reality that things are not always the way you envision them to be. the only questions we can ask, is a particular program, is a particular policy, effective? and then is there a way to make it more effective? which is exactly what j-pal is doing. i keep getting surprised at what people do, the ideas they have, and the creativity they bring to the table. and at the end of the day, that is what drives us.
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howard: before starbucks, i think in the mid-1970's, people were drinking instant coffee. maxwell house, perking it at home. and it was not very good. >> we tried to sell the consumer pong at the toy fair in new york. we sold none. and we said, what is wrong with this? ♪
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announcer: the incomparable goodness of coffee has now been captured in a cup. howard: before starbucks, i think in the mid-1970's, people were drinking really bad coffee. they were drinking instant coffee, maxwell house, and yuban, perking it at home. and it was not very good. [laughter] >> your first cup of starbuck's coffee was? howard: in the pike place store in 1979, 1980. it was a french press of sumatra. >> how much coffee is too much coffee? howard: i drink 4 to 5 cups of coffee a day. >> what do you think when
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doctors say cut down on coffee? howard: to me, they don't say that. [laughter] howard: they don't say that. [laughter] ♪ howard: you came for the day? >> we came for the day. you are the highlight of our day. there you are. >> thank you for your company. howard: thank you. when i came here for the first time, i had never been in a starbucks store. i walked in to this very store -- and by the way, we have changed nothing through the years. this is the original store, as is -- and they handed me a cup of coffee made this way. now this is a cup of sumatra, which is indonesian coffee. this is how i tasted my first cup of coffee, and i just knew, from that moment on, that i was home.
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did i ever imagine that we would one day have stores in 65 countries serving almost 80 million customers a week? no. growing up in brooklyn in the projects in the early 1960's, what i would loosely describe as the other side of the tracks, provides a deep sense of understanding that there is a world out there that is very, very different than the world that is inside, where we grew up. and i wanted to be part of that world. when i finished school, i got hired by a great company, and that was xerox. and i worked there for a number of years. but i just didn't feel i belonged in a very structured environment. so i left xerox and went to work for a large swedish company that was starting a u.s. consumer division. in a very roundabout way, they had a customer in seattle, washington called starbucks. their aspiration at the time was
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to expand to portland, oregon. i somewhat persuaded them that perhaps starbucks' opportunity was bigger. and they needed somebody like me. you have to understand, starbucks had three stores in 1982, but the core business was just selling pounds of ground and roasted coffee for home use. a year after i joined the company, i went to italy for the first time. of course, you can't walk through any major city or town in italy without running into a coffee bar. and seeing the sense of community and romance and theater around espresso, it just made me realize that starbucks perhaps was not in the right part of the coffee business, that the real business and the opportunity was the integration of the beverage to creating a destination and a sense of community in the store. what i experienced in italy was something that was transferable in the u.s.
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bring for the first time great coffee, introduce new beverages that no one ever heard of. nobody had heard of a cafe latte before. i raced home to talk to the founders about the experience i had and they rejected it. over a period of two years, i left starbucks to start my own chain of italian coffee bars. at that time, starbucks found itself in financial difficulties. and so the founder came to me and said, i can't think of starbucks in better hands than if it was in your hands. i realize you don't have the money. i will give you x amount of time to try and find it. i was able to buy starbucks in august of 1987 -- they had six stores at the time -- for $3.8 million. i didn't at that point have an understanding that coffee would one day become part of the culture, the zeitgeist, in ways that i couldn't possibly understand or predict.
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i think we realized early on that what we had to do is, everything had to prove itself in the cup. the ability to source and roast the highest quality arabica beans in the world gave us the platform to do things that would define and build an industry that did not exist. many people at the time were convinced that starbucks was too strong. we had to educate the market and the customer that no, this is what coffee should taste like. and there you have it. >> he kept criticizing us. it has got to have a score. you know, so i made it playable. i did not know it was a throwaway. we put the speed up and all this other little angles and worked on it. >> we found ourselves playing it after work for hours. ♪
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>> the simplest game you can think of. >> simplest game you can think of. one spot. two paddles. and a score.
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>> nolan was a dreamer, an entrepreneur, an extrovert. nolan: it was a dream i had. and i always felt that it was going to win. i just didn't realize it was going to win quite so quickly. ♪ >> absolutely, we changed the world. if we did nothing else, we changed the world. [laughter] ted: i was the youngest silicon valley president. i sort of plowed the field to make it easier for jobs and gates and those guys to plant. [laughter] >> ok, yeah. nolan: my family was always a game player, from clue to monopoly to chess. and i learned chess very, very early on. the epiphany for me was my third grade teacher gave me the responsibility to teach
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electricity to the class. and i got to play with the magic box that was locked in the closet. it had dry cells and wires and switches and lights. and so i started tinkering. and never stopped. allan: nolan came up with this thing. he says, how come on a tv set, when you change the vertical hold, the picture goes up, if you turn it one way, and the other way it goes down? can we do that horizontally? i said, we can do it digitally. so that is when i invented the motion circuitry. so nolan asked al to use that motion circuitry of mine. nolan: al is a better engineer than i am. by far. al: get that on tape, now. get that down. [laughter] nolan: the day that al was to show up, i had heard about this thing from magnavox. i had competition. i was scared.
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and so i went up to a game store, and they had two or three magnavox odysseys set up. i looked at it and it was fuzzy. it did not have sound. did not have score. but, i looked around, and people were having fun with it. announcer: odyssey -- it is new from magnavox. nolan: i had to tell al what i wanted him to do. and i thought a good training program would be this ping-pong game. and so to put a little bit of spice into it, i told him i had a deal with general electric, which was totally bupkis. al: you lied to me, nolan. [laughter] nolan: i lied to you. al: but he kept criticizing, it has to have a score. so i made it playable. i didn't know it was a throw away. we put the speed up and all this other little angles and worked on it. nolan: and we found ourselves playing it after work for hours. lee: we were playing it and everything, and it was really good. and nolan says, oh, no, we want a driving game. al and i said, no, this game is much too much fun. >> we decided we were going to test it. so we got ted dabney, built a box and a cabinet over the
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weekend. >> contact paper over plywood. al: the orange paint was whatever we had, i think. i went to the walgreens drugstore and bought a $75 hitachi tv set and turned it into a monitor. ♪ al: so here we are, nolan. nolan: here we are. al: wow, it has changed a lot. nolan: a lot. when we put the pong in here, it was just on the other side of these green pillars, on a barrel. and remember, this place was a different kind of place. al: peanuts on the floor. nolan: peanuts on the floor. and some of the barrels were for peanuts, unshelled peanuts. al: this game had never been seen in the wild before. there were no instructions. there was nothing like it. and so i was just dying to see how people would adapt to it. how quickly. and, boom, they started having fun with it really quick.
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lee: all of a sudden, al gets this call, saying, hey, the machine is broken. so al runs down there to find out what is going on. al: i got the call it had stopped working. lee: it turned out the coin mechanism had filled up so high it was jammed -- jammed with too many coins. [laughter] al: so i opened up the coin slot. the quarters came out and i filled my pockets. and then i called you up and said, hey, nolan, i think we have a good sign here. >> that was a tricky shot. >> not. >> almost got that corner. one sure way to win -- yeah, that is it. that is it. the paddle does not go up all the way. now that was a feature. >> that was actually a fault. al: yeah, it was a bug in the circuit that i was going to get back to it and fix it later.
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then we realized, if we did not have that, two good players could play forever. so hence my expression, if you can't fix it, call it a feature. ♪ nolan: home gaming was important because it allowed a much broader dissemination of electronic gameplaying into the population. we tried to sell the consumer pong at the toy fair in new york. al: oh, geez. oh, god. nolan: we sold none. and we said, what is wrong with this? al: yeah, i mean, here we were at the toy fair with a product that would in fact become the hit product of the decade. so we cold-called the sears tower and got through to tom quinn, the buyer in sporting and goods that was trying to sell the magnavox odyssey game. two days later, he is at our doorstep at 8:00 in the morning. that was such a stroke of luck. nolan: quinn says, how many can you make by christmas? al: oh god.
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nolan: and i said, 75,000. and then he came back with an order for 150,000. al: right. nolan: i said, we can't possibly build this many because we just do not have the capital. he said, let me introduce you to sears bank. al: yeah. ♪ lee: pong was the one that got everybody's attention. we created the videogame industry because we made the first commercially viable videogame. and then from then on, everybody, you know, moved on from there. nolan: games are part of the dna of most people. whether it be smartphones, oculus rift -- i think it is all going to be blended into this interactive slurry of fun. the ability to play anywhere, play anything, is bound to be a continuing saga of the world. ♪
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