Media moguls relish summer powwow
The Sydney Morning Herald
July 15 2003
Like migratory birds, dozens of private jets return each July to the tiny airport in nearby Hailey, Idaho. There they unload titans of finance and the information industries, like Warren Buffett, Bill Gates and Michael Eisner, for a week of meetings, mountain biking and barbecued burgers here in Sun Valley. It is part of the annual media mogul summer camp organised by investment banker Herbert Allen.
A year ago, the gathering was full of remorse and recrimination over mergers and acquisitions consummated in the giddiness of the internet boom. But when the moguls returned last week, with media stocks up from the lows of last year, conversations turned once again to talk of who might be buying whom.
"Corporate Cupid," said fund manager Mario Gabelli. "Big love-making, big deals out of this thing; you are going to see a lot."
The prime topic was handicapping the auction for Vivendi Universal's film and television studios, cable channels and theme parks. On hand to provide their own spin were several of the key players, including Sumner Redstone, John Malone and Barry Diller.
Mr Gabelli predicted that the Vivendi auction would be a catalyst for more deals, as would the recent lifting of the caps on the ownership of newspapers and television stations by the Federal Communications Commission.
Decades of deals and consolidation are making the annual Sun Valley conference more important to the industry than ever, bringing together the handful of giants that own the Hollywood studios, television networks, cable and satellite systems and TV and radio stations.
"As the industry consolidates, you have fewer and fewer owners, and each of the owners have more reason to do business with each other, so in a place like this, where they are all here together, a lot of business gets done," William Kennard, an FCC chairman in the Clinton administration, said.
But in a shift from past years, some of the industry titans assembled said they doubted the wisdom of that deregulatory move and further industry consolidation. Mr Diller, chairman of the InterActive Corp and former head of Vivendi Universal's entertainment division in the US, denounced the domination of the TV business by a handful of "oligarchs".
He has argued publicly for several months that the half-dozen media conglomerates, owners of production studios as well as TV networks and cable systems, have, in effect, collaborated to freeze out independent producers and lower the quality of new TV shows. But most at Mr Allen's conference shrugged off those concerns.
Among many making presentations was the world's richest man, Bill Gates, who attended with his wife Melinda. Gates's paper was on the big changes ahead for software.