Call Me Ted (21 page)

Our kids were on vacation and they stayed in Newport for much of that summer. As usual, it was hard for me to spend large amounts of time with them but it was great to see them and I think they enjoyed the carnival atmosphere in Newport and the chance to see their dad at the center of this competition. Janie stayed with the crew and me while Jimmy Brown took care of our kids.

A TED STORY

“One of the Wildest Places in the World”

—Jennie Turner Garlington

We lived on
Tenacious,
one of Dad’s boats, down at Bannister’s Wharf; all five of Ted Turner’s kids and Jimmy Brown in one of the wildest places in the world at the time of the America’s Cup. Jimmy would send my brother Beau up to the area where all the bars were, including one called the Black Pearl, to look for money that the partiers might have dropped on the ground. Beau always came back with pocketsful of money—twenties and fifty-dollar bills.

The July trials were more competitive. North and
Enterprise
had made some adjustments to their sails and strategy and we got off to a rough start. After losing the first few races I was able to secure a new jib for the final race and
Courageous
ended the trials with a head-to-head victory over
Enterprise
.
Independence,
though competitive, ended July looking like the third best boat in this three-way contest and now it would all come down to the final trials in August. There was intense pressure heading into the finals, and I decided to take a new approach this second time around. I made up my mind that this go-round I was going to have fun. I’d work hard, but I figured that the pressure was on the other crews and the way our team and boat were performing, staying loose and relaxed might even improve our chances of winning. Newport in the middle of an America’s Cup summer was quite a scene and I made the most of it. My more fun-loving style continued to cause a stir within sailing circles and soon I was pegged with the nickname “Captain Outrageous.” I was just being myself, of course, but all these things being relative I guess my behavior was pretty far outside the norm.

I continued to work hard and make sure my crew was well prepared, and in the final trials we sailed better than ever, getting off to a great start in the early races. Meanwhile,
Enterprise
performed poorly in her first few contests, and their syndicate, believing he had not made the necessary strategy adjustments to keep up with
Courageous
, replaced Lowell North. After eighteen total races, we had won nine,
Enterprise
five, and
Independence
four, and the selection committee decided they had seen enough. Led by none other than Commodore Hinman, they approached to give us the news. Three years after having to relieve me of my duties, George Hinman now had the pleasant task of informing us that we had been selected to defend the Cup. It was a tremendous thrill for all of us.

Courageous
had been winning convincingly enough that the committee made their decision relatively early, giving us two full weeks to gear up for the Cup races. Meanwhile, the team from Australia—on a boat named
Australia
—emerged as the challenger. The Cup would go to the first boat to win four races, and in the first contest we started out even and for the first seven or eight minutes, we stayed that way. Our two boats were really feeling each other out and I remember Gary Jobson using his handheld compass to track
Australia
’s speed. He turned to me with a concerned look and said, “They’re not slow.” I grinned back at Gary and said, “Yeah, but they’re not fast, either!”

Not long after that, I decided to get into a tacking duel and we found that with each tack we picked up a few seconds on
Australia
. These were long races—the course was just over twenty-four nautical miles—but they were generally pretty close, and every second you could add to your lead was important. We won the first race by nearly two minutes. The next three races were almost identical—close starts and a long, steady tacking duel leading us to victory.
Courageous
beat
Australia
4–0. We were the America’s Cup champions!

We had worked so hard that when that final horn sounded, we were ecstatic and the post-race celebration began immediately. Other boats that had been watching the final race came up to us with bottles of champagne and beer. As was the custom, when we reached the dock, we all either jumped or were thrown in the water and it was really cold. One of the guys from the Swedish team gave me a bottle of aquavit. We were having a great time when all of a sudden somebody said, “Time for the press conference!”

Celebrating with my teammates, I had completely forgotten the press conference. By this time I was more than a little tipsy and the crew had to practically carry me to the press tent. I hardly even remember the press conference but it was recorded for posterity and I must admit that it disappoints me that my slipping under the table to retrieve my bottle of booze remains the image a lot of people have of our victory. After the conference I ran straight to our boarding house. I didn’t even have dinner—I just went straight to bed.

I was thirty-nine years old when I won the America’s Cup. My life had been exciting up to this point but this was by far my most exhilarating victory. Our crew had performed brilliantly and I enjoyed the hard work, the success, and the recognition. As I flew home to Atlanta, and prepared to go back to work, my thoughts turned to what would come next.

13

Cable News Network

W
ith TBS on the satellite I was convinced that in addition to being a lot of fun, cable programming was going to be an important business. As the operators invested in infrastructure and added new subscribers, the channels they carried generated additional revenue with few incremental costs. With a shared desire to grow our industry, the cable operators and I had a friendly partnership. I needed them to run more cable and to grow distribution and they needed me to create quality programming that would encourage people to sign up. I summed up this relationship one time in a conversation with Bob Magness, the founder of TCI and a cable pioneer. “Bob,” I said, “you run the wires, I’ll make them sing!”

By 1978 it had been several years since I first considered an all-news channel and still no one had done it, so I decided to consider launching one myself. But at the time, Turner Broadcasting didn’t even have a news department. As an over-the-air station in Atlanta, WTBS was required by the FCC to fulfill basic requirements for news and public affairs programming. But with our limited budgets and our concentration as an entertainment service, we did as little news as possible, and we presented it in an irreverent fashion in the overnight hours. (Our anchor, Bill Tush, would on occasion read the news with a German shepherd sitting next to him, or he’d put a shopping bag over his head and call himself the “Unknown Newsman.”) At a 1979 congressional hearing about the SuperStation, a panel grilled me about the way we presented the news. When Massachusetts representative Ed Markey asked me if it was accurate that we were airing news “at three or four in the morning,” I answered, “That’s accurate, and we have 100 percent share of the audience then!” News was treated as something we needed to do to keep our license, not as an important part of our business.

I was so busy that I rarely watched news on television. In the late 1970s, most newscasts were on only at 6:00, 7:00, and 11:00
P.M.
I usually came home around 8:00 and since I got up so early in the morning I’d be asleep around 10:00. I wound up getting most of my news from newspapers and weekly magazines and I figured that my experience was not unique—there had to be other people whose work hours were not conducive to watching the evening news. I also knew of the success of all-news radio and if it could work on radio it would work on TV.

Because we were so small, this would be a risky undertaking, so I spoke to other people in the industry to make sure no one else was planning a news channel. It would have been a disaster to invest in a new start-up only to have to compete with a larger, well- financed competitor. One of the people I called was Jerry Levin. Time Inc. was now successful with HBO and as the publishers of magazines like
Time, Life,
and
People,
they seemed to be a logical company to move into cable news. Jerry let me know that they had studied the concept seriously but couldn’t see how it would make financial sense. Their research showed that the news departments at ABC, NBC, and CBS were each spending between $200 and $300 million a year just to put on a thirty-minute telecast at night and morning shows like
Today
and
Good Morning America
. This led them to conclude that twenty-four hours of newscasts daily would simply cost too much. Jerry assured me that if we gave it a try, Time Inc. would not be a competitor, and as cable operators, they would do what they could to be helpful to our efforts. Another party rumored to be interested in a news channel was the Washington Post Company. They not only published
The Washington Post
and
Newsweek,
but also owned some local TV stations. But from what I heard they, too, were intimidated by the broadcast networks’ news budgets and were not likely to move forward.

Clearly, the companies for whom the economics of twenty-four-hour news would have made the most sense were the Big Three broadcasters. They already had most of what was needed—studios, bureaus, reporters, anchors—almost everything but a belief in cable. The over-the-air broadcast business had been good to them and they gave this new technology short shrift. To me, network executives had become short-term thinkers whose primary focus was to have better ratings than the other two networks. While we pondered the future and were planning several years out, they spent most of their time thinking about which prime-time shows they should renew or cancel. I’ve often compared business strategy to a chess game, and when it came to Turner vs. the networks, they might have had more pieces on the board but they only thought about their next move while I was planning ten moves ahead.

As hard as it was for me to believe, all the evidence suggested that neither ABC, nor NBC, nor CBS was getting into cable news anytime soon. I decided it was time for us to try it ourselves, and if we were going to do it we had better move quickly. We were so much smaller than our competitors that the only way we could compete effectively was to take advantage of opportunities before they became obvious.

I’m often asked if we ever did any formal research on the viability of twenty-four-hour cable news and my answer is no. I had spent over five years thinking about it, and it was time to get going. Henry Ford didn’t need focus groups to tell him that people would prefer inexpensive, dependable automobiles over horses, and I doubt that Alexander Graham Bell stopped to worry about whether people would prefer speaking to each other on the phone. If viewers liked watching news on television, why wouldn’t they want the option to do it at any hour of the day? And wouldn’t it be great to see breaking news live, instead of having to wait to watch it on tape at 7:00 or 11:00?

In addition to bypassing research, we also took a different approach to thinking about what it would cost to run such a channel. Instead of looking at what the networks were spending and adding to that number, we started with how much we could afford, then tried to back into a feasible plan at that level of expenses. The number we originally came up with was $30 million per year. This was about one tenth the annual costs of the Big Three news divisions, but even at that level of expenditure this venture would be a huge stretch for our company.

For years I had been selling off our billboard interests to help fund our expansion into television and to launch the SuperStation. I decided that if we moved ahead with news, it would be necessary to part with WRET in Charlotte, which we believed we could sell for around $20 million. Even with these proceeds it was clear that this business would never make it on advertising revenue alone. We needed commitments from cable companies not only to carry the service, but to pay us a per-subscriber fee as well.

As straightforward as the concept for an all-news channel was, I wanted to name the service before we marketed it. My family name had been on each of our businesses, but in this case, knowing how much we’d need the cable operators’ support, I decided to emphasize “cable” and call it the Cable News Network—CNN. My reasoning was simple; using “cable” in the name would not only bring attention to this relatively new means of distribution, it would help motivate cable operators to carry us. After all, if someone signed up for cable, they’d have to assume that they would receive the
Cable
News Network.

With a name for the channel and a rough idea of expenses, I decided to test the waters at the annual Western Cable Show in December of 1978. Terry McGuirk and I arranged for a meeting with the board of the NCTA—essentially the heads of all the major cable companies—and there I described my plans for the Cable News Network. In addition to telling them how great this service would be for our industry I let them know that the only way we could make it work was to charge a fee of 15 cents per subscriber per month ($1.80 per year). At that point cable was only available to about 10 million homes so even if we were launched in each and every single household, our total cable fee revenue would be $18 million, not enough to cover our annual expenses.

We’d try to make up that difference in advertising sales, I explained, but that would be a very tough go in the early years. I told them that I wasn’t asking them to risk anything—they didn’t need to make an up-front investment with us, they simply had to pay us if we delivered the product. At the end of this fairly brief presentation I passed around copies of a contract and asked each of them to sign it. Essentially, it said that if I put CNN on the air, they would carry it and pay. Not surprisingly, they balked at signing a document like this on the spot with such short notice but I left with confidence, feeling that we would have the industry’s support.