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tv   The David Rubenstein Show Peer to Peer Conversations  PBS  September 20, 2019 11:00pm-11:31pm PDT

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announcer: support fti the pbs presenta of this program was provided by geral motors. i see a future. i see a good future. i see a future filled with roads and no rage. both: we suture... with zero crashes. woman: i see a future where fossil fuels... man: are of the past. all: we see a future with zero emissions. i see a future whetraffic. keeps perfect time. where intelligence is always by design. we see a future with zero congestion. zero congestion. an: we are... second both: we are... all: general motors. david: what propelled you to want to join this company? brian: i just always wanted to work for my dad. david: did he say, "you start at the bottom and you work your way up," ouor did he say you could start at number two? brian: well, that's maybe what i wanted to happen. d: did anybody say, "well, is he really ready to be president yet?" david: have you ever had problems with your cable? brian: sure. david: is it intimidating for the cable repairman to come to your house?
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woman: would you fix your tie, please? david: well, people wouldn't recognize me if my tie was fixe but ok. just leave it this way. all right. i lfn't consider myse journalist, and nobody else would consider myself a journalist. i began to take on the life of being an interviewer, even though i hain a day job of rua private equity firm. how do you define leadership? what is it that makes somebody tick? when you graduated from college in 1981, th you went to university of pennsylvania. you then joined the company your father had started, comcast. at that time, it was a relatively small company. wi did you ever, in youest imagination, think it would become the leading company that's it's become in the telecommunications area? brian: we had about 20 milthon in revenue year, and my father, when asked that question
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for many, many years later used to say, "of course." that we beuld be lucky enough to omcast nbc universal, sitting here with the kind of wonderful products and company we have. and i pinch myself every day. david: did you ever say to your father, "i don't really want to join the company. ." i might want to do something el what propelled you to want to jn this company? brian: well, i thought about that. ed i just always wa to work for my dad. he used to be in the men's belt and suspender business way back before he started comcast, men's cologne. we used to play withg the cologne growin as kids, and he would have a passion about it. fu just made it seem for me. he never pushed to me, even a little bit, to want to work for the company. david: what was your father's background? brian: well, he got out of the navy. was living in philadelphia, met my m. they got married. they were married 72 years until he passed away a couple years ago. he was very interested in business. and he was an entrepreneur, made golf club putters.
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he went into muzak, marketing. orked for senar benton in advertising. so he liked the marketing and advertising prodts side. and one day, you know, he got into men's cologne, and he just loved the smell and the marketing aspect. and then the same with a product, like a belt or a suspeer. technology came along, and he got himself convinced that sansabelt slacks, that is polyester pants without belts, would be the technology that could put him out of business, so he sold his business. he was walking around philadelphia, apparently, 1963, and a guy came up to him and said, "ralph, i have a got a new venture for you. "you oht to buy a community antenna television system in tupelo, mississippi." and as he told the story, he said, "where's tupelo and what is community antenna television?" birthplace of elvis presley. and in tupelo, they couldn't get cbs
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from memphis-- it was a valley town-- and ran a community antenna, catv, and those were the early roots of cable television. r david: television was free in those days. now you had to pay for it in tupelo, mississippi. so was that hard to convince people to pay for television? brian: what he liked about the business was the subscription nature. so in belts or cologne or many other businesses he had been in, yo a product, you sell it, if you get sick next month, you're out of business. in ouress, and what he liked about recurring revenue, is ya have to go borrow t of money, build it, and hope they will come, then you have a recurring business that you thehave a ba. david: where did the name "comcast" come from? brian: great question. it doesn't get asked very often. it is amazing that in 1963, being a community antenna television company, he dreamed up the name comcast.
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and we were going to merge and b in the future of communications and broadcasting, so he was very visionary in that respect. david: you buy the cable franchise in tupelo, mississippi. how much did he pay for that? brian: i think a few hundred thousand dollars. david: a few hundred thousand dollars, ok. and what did he do after that? he started buying other franchises like that? brian: yes. so, the next-dooia town was mer and he would go down to tupelo-- he never moved there. he had a philosophy of decentralized management, in that you would have a local manager, and they should feel like they own the business, so there was aal manager of tupelo. and then they went and bought meridian. then one day he got into michigan, another day, new jersey and pennsylvania. and we started buying other operators. and as the business evolved through the eighties, one day, it was not just a valley town business espn and hbo and cnn came along. it wasban and urban.
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and so there were 30,000 cable franchises awarded, and eventually, they needed to consolidate to be morea tv business or phone business, where you had larger service eas, and that's when comcast really stepped on the pedal. david: so in the early eighties, the franchises were being awarded around the country as cable tv became more popular because, as you mentioned, hbweor other services available. so did you compete to buy those, or did you buy them from people who alrea won their franchise? brian: a little bit of both. there was franchising wars was one era. that got a little crazy. and one of the, i believe, hallmarks of comcast was live up to what you say you're gonna do as best as you possibly can. so in the franising wars, people started to promise crazy things to win a franchise. we'll plant trees. we'll control your traffic lights. wel pay more money. and it was not economic, so we stopped. and some compani then went back
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and had to break their promises. comcast really tried not to ever have put ourselves in that position. second phase, once they were all awarded, or most were awarded, some pple ran out of money, couldn't build them, or wanted to sell, and we probably bought more cable systems th almost anybody. maybe there were one or two others who were consolidators. david: so in the early days, whwere the leaders? you were not the leader in number in those days. brian: no, we were one of-8, maybe number 15. john malone was very aggressive. david: so cci with john malone, and there was -amex. brian: yeah, so go back to gus hauser and drew lewis. warner under steve ross in the old warner-amex days. there were--teleprompter was a huge company, eventually got bought by westinghouse. bl there was continental cox cable, many other-- d: how did you get the financing to buy all these? where did the money come from? it couldn't come from the cologne and belt business, right
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brian: well, two things. one, we went public in 1972. before tha even after that our chief financial officer who wavice chairman of the company for a long time after that, julian brodsky, was ve eative financi with myad. so they tried limited partnerships, master limited partnerships, separate public subsidiaries. insurance companies made fixed loans that had never been done. euro converts. so they tried many different pools of capital. eventually, when wwent public, my dad had the foresight to know that if we were going to achieve the long-term goal, we needetoto issue more s. and so we had two classes of stock, and that allowe us to think for ng term. and we've ised billions of dollars of stock in allition to billions of s of debt. david: so in 1972, had bought your stock, what would i be-- brian: if you had bought 1,000 shares, it came public at 7, went down to $.25,
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i think, at the all-time low, that is another story, you would have over $11 million today, and 18% plus compounded return for 45 years. if you put the same $7,000 in the s&p 500, you would have just over half a million, with about a 10% rurn. david: that's not bad. brian: not bad. david: ok, so when you joined the company, did he say, tart at the bottom and work your way up"? or did he say you could start at number two? n: well, that is maybe what i wanted to happen. no, he definitely put me through a wonderful kide facto training without either of us ever talking about it that way. so one summer, i climbed poles and learned to be an installer. had real trouble holding the ladder because i was pretty weak and 15 years old. another summer, i sold door-to-door hbo subscriptions s-and cable subscripti it was brand-new--in west moreland, pennsylvania. another summer, i went and sold muzak, which was a business comcast wain at the time,
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installing and selling. david: right. brian: so when i got out of wharton school, undergrad, , was like a finance maj and i was like, "well, let's go ando deals." he said, "no, move to trenton, new jersey. "i never worked in cable. that was one of my later businesses in life." my dad was in his edrties when he staomcast, which is a great lesson for people. if you have not found your thing yet and you are 40 yearsld, it is not too late. and many people think it is way too late. and he said, "but i will never know this business. why don't fru learn it as well the bottom up, every job?" so i moved to trenton and learned the billing system, worked the counter when customers paid their bill, and when the truckblelivered the new boxes, it was a brand-new system in trenton, you know, we'd get out and everybody'd roll up their sleeves and unload the warehouse. so i had the pleasure of doing all the jobs, and something for me just clicked. i loved the business, i love being around people, and i loved being in management at a young age. dahen you are in business with your father,
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do you call him in front of other people dad, or do you say ralph, o? brian: i called him ralph. when he had all his grandkids, he had all the grandkids call him ralph. one of the great things he did for my daughter, who has now just had her own child a few weeks ago, he said, every kid o. learns the word thats one of the first words they learn. so he got on the ground with all the little grandbabies and would go like this and said, "yes, yes." and one of the amazing things my wife andenjoyed , and i think my siblings did and my mom, is his positive attitude about life. and it came out for all the employees. he had a yes attitude. david: you became an employee in 1981 when you joined, but you became the ceo in 19-- brian: we did not use that title between my dad and myself. 1990, i became the president. yeah, i was about 30 years old. davi and did anybody say, "well, is lly ready to be president yet?" brian: everybody, including myself.
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but i was very eager to-- having word for many years, half a dozen years in different jobs in trenton, in flint, michigan, in dallas, in pittsburgh, and then trenton again, back in philadelphia, then in the corporate side in finance-- my dad was still active, but he was 40 years older than i was. so i w 30, he was 70, and he wanted to begin continuity without an abrupt change, so we worked as partners really from then on until he died. vid: people like products of let's say amazon, or they like the products of apple, or they like the products of starbucks, and they therefore tend to like the companies. why do you think comcast and other cable companies are not that well-liked, unlike other companies whose products are popular and the companies are liked? d? brn: well, it is a great question. teon used to be free, annow most americans are paying a lot of money for it.
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and every year, it can get more expensive. and that is tse sum total of spnd the cost of actors, and the comany, many more channels, high definition, technical capabilities, and if we are passing all of thcreases along that we have experienced, no one remembers that. so that is partly why i think it is an industry issue, but that is not a good answer. so what we set about at comcast was to not accept that an to try to find a way to emulats you just referenced who have a lot of goodwill. and we thought that by king our products better. we changed the name of the company to xfity. we came up with a product called x1. and it tout 10 years in development. we are building a technology center here in philadelphia. and we are tryinto pivot the whole coany to have a rapid deployment of new products that delight and surprise you all the time. back that up with advertisd g and messaging derstanding
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byonsumer of what it is you get, and then maybe the link that was missing, after we achieved that with some of our products was service-- showing up on time, getting it right the first time, having the network be reliable. david: do you ever have problems with your cable? brian: sure. in a while. david: and what do you do? you call somebody, call your office, what do you do? brian: well, you know, i use it as a learning experience, firsof all. we are constantly trying to improve and have a virtuous cycle of repair and improvement. if my cable is out, i use my app. i then will go back and see how many customers are affected. and as a culture i believe we have improved massively, but we have a ways to go. david: but is it intimidating for the cable repairman to comour house, you think? they know they better get it right? or theknow it is you? brian: hopefully a little bit of both, but ultimately i try not to get so much different treatment
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at our customers are experiencing, but i am sure there is some of that happening. david: so cable tv blossomed in the eighties and nineties, and you grew to 20-some million customers, and then at some point, broadband came along. in effect, you had built cables ff everybody's homes, ul then you realized you use those cables for internet access as well. when did it dawn on you th you can actuallyell more than cable tv to those same customers? ian: there was an a-ha moment on that, , and that was a meeting in seattle of a group that we formed with other cable companies called cablelabs. we went to see intel, oracle, and microsoft. and while we were at microsoft, bill gates was talking about someday the data business for you guys will be bigger than ssyour television busi i said to bill "would you consider investing in our industry?" because we're putting all of these e ber optics, alis new thing no one had heard of. wall street hated it. our stocks were low. e spending capital. this is one of those cycles
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where you cannot always but you feel like you should invest and hope that it wl work. and he said, "i think fiber will change the game for you. how can i help?" i "why don't you buy a percentage of the room?" and then everybody lghed. and i said, "ok,ust buy comcast." he put $1 billion from microsoft into comcast, non-voti snock, no board seat, icrosoft products. david: what kind of return did he get on that $1 billion? brian: 400%. and it started the broadband wa that have been the beneficiary by consumers the last 20 years. david: are you worried that maybe people will say, "i don't want to buy my cable tv at all. i'll get eing through the internet"? is that a problem you have? brian: first of all, that reality is happening. we have seen it coming. the other a-ha moment for me who we were visiting, trying to see if we could collaborth apple a decade ago. he said, "why don't you put wi-fi in all your cable boxes?"
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david: and you said, "what is wi-fi?" brian: i went, "what is wi-fi?" because it was before and now we have more wi-fi than any company in america and we have the faest wi-fi. david: you bought from ge nbc universal. were you worried that maybe you shouldn't be in the content business? brian: well, there were people who had that worry. th we had aream thaperfect company, if you could create it from scratch, would be in the distribution, but also in contt. both were good businesses. they were kind of mbiotic. and so we had gotten to a certain scale, and scale matters. we had dabbled in content. we owned the golf channel. we owned e! entertainment. we had some regional sports networks. and along came the recession of 2008, 20 and thfinancial crisis. and ge needed, or wanted, to sell nbc universal. we had been knocking on the door for a decade. and one day, they said ok, and we jumped at it. david: andngs like hollywood studios,
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sometimes people who own hollywood studios like to go out and hang out with the stars. that is not you? brian: tt is not really me. i care abo movies, but i have never been on a movie set. david: now there is a concept called net ntrality, which 99% of americans probably don't fully understand. can you explain what net neutrality is and why it is such a big deal? brian: to me, it can also be called regulation. and so, what do i think we stand for? whve tried to say from thday bill gates helped us withdea of the internet was that you could go anywhere you wanted or in the case of privacy, someone knowing your behavior in a way you don't want. and how do you have a set of rules that gives you, the consumer, that confidence and the certainty, and, at th time, allows for investment in innovation as new applications come along? and we have always said we stand for certain principles. those principles were codified by the fcc.
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he fccen the court said didn't havseauthority to codify trinciples. so another fcc came along and said here is another way to do it. let's put it under something called title 2, which is a regulatory regime designed for the phone system back in the 1930s. and we did not agree with that. and that can get bundled in a phrase, net neutrality. and oftentimes people say, "oh, you are against net neutrality." alat is not the case a david: you must to washington from time to time to talk to legislators or other people, is that a painful part of your job? brian: well, i like advocating for comcast. i am passionate about our company and our beliefs. you start from literally tupelo, mississippi and no busess, and you take risk capital. we have never had a guaranteed rate of return, ny like a phone com we've borrowed $60 billion to build the company. no one says we will be here in 50 more years.
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we are 50-plus years old. d and we have crea 150,000 jobs, %, 95% here in america. so from time to time, depending where the pendulum is going, there are proposed things that are going to have real implications, and you try to aoriculate and advocate that. we've been heavily regulated business, at least from my perspective, since the beginning. david: you have cable. you also have broadcast channels. you have movies. how do you have time to watch all the things that your company is producing? brian: well, we grew up in this biness. when i started back in 1981, they were just coming out with cable channels. and i was very lucky when d turner called me up and asked would i come on his board. i think i was my late twenties, maybe early thirties. i was the youngest person on the board. and i saw him literally change the world with cnn and literally change the world by putting nfl games on a new network, tnt, and taking the mgm library
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and bringing it to cae television and building new channels-- cartoon network. so i always y,ought well, somet would be nice if comcast could help do that as we continue to evolve more and more niches in television. so how do i have the time? well, i don't see everything we do. i try to see some of-- a lot of what we do. like,: if you see something you don' do you call them up or are you just kind of-- brian: no. i have a point of view, but i also know what i can do and what i shouldn't do. and i try to have some disciplinen that. but i sometimes just share opinions, think they-- we have some of the best professionals. david: on technology, right now, you have to be at the forefront of all kinds of technologies. do you personally review all the new technology inventis? brian: we are building a new technology center, which i am very involved in and excited about, but i can't do every invention.ca but since it comes down to one remote control and one guide, i do get fairly involved and see things before they come out, try to help the team.
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david: what gives you the greavist pleasure in the job you have? brian: the fun is that that answer changes over time. it has not been the same old thing my whole life. today, i mean, sadly, my dad is not here, so there was a wonderful moment that went folong, long time, and we were so lucky. toda trying to figure out where this industry is going, and that dynamic change of technology and innovation in things like artificial intelligence and the cloud and the competition, which ver been greater, stimulates you. and over--and trying to think through how to build value for sharehol brs. david: in college, youay were a squash pl. and you were an all-american squash player. brian: i love the sport. and the best players in the world, which i never was close, are super and superb athletes, and as good as any athlete i think, in any sport. and when io penn, i had a squash coach who was the opposite of my dad.
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i have always said the second or third most influential person in my life, one of the top-- david: is coach malloy. brian: coach malloy. and he was a marine, or an exarine. and he really drilled into me hard work, winning strategy, tactics, and i went on and played a gre run in squash and had a cho compete internationally after college. david: so now you compete still at the maccabiah games. you have won the gold medal and silver medal. and you y e now going to pain there? brian: my children have both done it, my twdrdaughters. and my son said, "let'you " so we are going to go this summer to israel and compete one more time. it will my sixth time. i proposed to my wife on one of the trips. it's had a real significant meaning in my life e able to compete, represent our country, be a jewish athlete, and at the same time, share my family experiences, as we have all played the sport it and had a lot of funh it. david: well, you are now in your fifties. is it hard to get into shape to play in maccabiah games
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when you are in your fifties? and it is very hard. that is the short answer. every body parine hurts right now from training, but it gives you a purpose. i guess i li goals. it is very similar to comcast. and you don't always win, but it is fun to try. david: are your children interested in coming to the company? bria so i've been asked at question, the first part of that question, for sure by a lot of other families. to me, it is a really clear answer. you should do what you want to do with your life, not what your parent wants you to do with your life. and for me and my family, that's how you end up having happier life. and if it's something you want to try out, great. it comes with the presumption that you're not that good. you only got there because, so it is a higher burden. and as i have talked to my own kids, as they figure out their lives, there are different answers to that question. david: what are yourreat philanthropic interests? brian: well, we've just made a really cool involvement
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with the cldren's hospital of philadelphia here. we are going to do a genetics center at philadelphia's children's hospital, is arguae number one children's hospital in the world. so as genetics technology comes can they continue that leadership? so we created a genetics center. we have been involved in some of the arts. bu my wife chaired thding of the new barnes in philadelphia, something really special for this city. it is dr. barnes' collection, maybe the best impressionist collection outside the louvre in paris. and for philadelphia, it really gave it some additional world-class stature. david: your father was in the company for a long time. you could do this another 20 or 30 years. is this what you intend to do for the rest of your professional career? brian: i love what i do. and it is hard to imagine something else. but i also recognizehat you have got to keep the company fresh, and so we will take it one day at a time.
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announcer: support for the pbs presentation of this program was provided by general motors. e a future. i see a good future. i see a future filled with roads and no rage. both: we see a future... ashes. woman: i see a future where fossil fuels... man: are a thing of the past. all: w zsee a future witho emissions. i see a future where traffic... keeps perfect time. where intelligence is always by design. we see a future with zero congestion. zero congestion. man: we are... second man: we are... both: we are... all: . ♪ you're watching pbs.
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