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Tuesday, June 15, 2004

Here's the kind of job I want.

I was reading in the L.A. Times this morning about Michael Eisner's purchase, back in 2001, of the Fox Family Channel from Rupert Murdoch. Murdoch's accountants valued the property at $3 billion, give or take a buck and a half. (They'd purchased it in 1997 for just under $2 billion and the channel was ailing, thereby making it worth an extra billion. No, I don't understand it, either.)

After a full hour of negotiations, Eisner paid $5.3 billion for what is now the ABC Family Channel. Murdoch figures that, if Eisner had kept negotiating, he'd have talked himself into paying another billion.

In all fairness to Eisner, the price also included a few other assets, such as a collectible Fox Family Channel keychain and a coupon for a free Wienerschnitzel chili-cheese combo (with purchase of similarly priced item).

Eisner had a plan for the channel: He'd take popular TV shows from the Disney-owned ABC network (I know, "popular" and "ABC" don't really go together, but you know what I mean) and "repurpose" them for the cable channel. The word "repurpose" might make you think, "Oh, you mean, take a show that's meant to entertain people and use it to, what, open cans?" But in Eisner-speak, "repurpose" just means "rerun." This tactic was going to revolutionize TV broadcasting.

Eisner and his honchos projected ad revenues for the new channel that would make it a moneymaker in only another decade or so. They based their anticipated ad revenues on the USA Network, which resides near the top of the ratings charts for cable channels. The channel they were buying fell much further down the list. But Disney was optimistic that rerunning the same lackluster programs that put ABC at the bottom of the broadcasting heap would propel it to the top of the cable TV heap.

There was one hitch, though, in this well-thought-out-while-waiting-for-an-elevator scheme: "Repurposing" a show meant renegotiating all of the contracts with actors, directors, producers, etc., a time-consuming and expensive process. And some shows, such as The Practice and Spin City, weren't eligible for repurposing at all because they were headed for syndication.

So Eisner and Co. were stuck with creating new programming, and their crack marketing department informed them that the age demographic to appeal to was the 18-34 group. All they had to do was come up some incredibly hip and edgy programs for young adults. Yeah, that's a Disney strength, right?

Anyway, before they could embarrass themselves with the programs, they were embarrassed by their failure to read the fine print in the contracts regarding the Fox/ABC Family Channel. Turns out that the word "family" had to remain in the name of the channel, thanks to wording in contracts dating back to 1977 when televangelist Pat Roberts founded the channel to host his 700 Club. "Family" and the anticipated age demographic just don't go together. "The Extreme Family Channel," anyone?

So far ad revenue has been about $100 million a year. At that rate, it will take 53 years for the channel to earn back its $5.3 billion purchase price, assuming that production and operating costs are zero. Which I would not be surprised to find Eisner and his cohorts assuming, given the dexterity with financial projections they've exhibited to date.

I know that I'll never be a Michael Eisner level player. I couldn't cost a company $5 billion if I tried. But there are a couple of jobs buried in this sorry mess that I might be able to pull off. I'm referring to the jobs of Eisner's chief financial officer, Tom Staggs, and chief strategist, Peter Murphy. Each was awarded a $1 million bonus for his "extraordinary services" in bringing this clunker of a deal together.

I'll take any job...any job at all...where I can screw up monumentally, cost the company billions of dollars, and pocket a million dollar bonus.

Just let me know where to send my resumé.


Tuesday, June 08, 2004

Remembering Ronald Reagan

The airwaves are filled today, as they were yesterday, with remembrances of our late 40th President, Ronald Reagan. Almost everyone on the radio and the internet seems to recall Reagan as "the greatest President we ever had" or something close to it.

I remember Ronald Reagan. I remember him as the populizer of "trickle down economics," otherwise known as "Reaganomics," which held that by cutting taxes to the wealthy, money would "trickle down" to the poor and the middle class. It didn't. The upper class seemed to hold onto that extra wealth pretty good. Which shouldn't surprise anyone. That's why they're wealthy.

I remember Ronald Reagan comparing the Federal Government to a child who wasted his allowance, and saying that the way to cut the kid's profligate spending is to cut his allowance. So he cut taxes to the wealthy and starved the government of funds. Problem is, the Federal Government is a child with the world's biggest charge card. So the budget deficit ballooned to three times its previous size while government spending increased 2.5%. We went into debt for the next decade to pay for it.

The economy did get better under Reagan and interest rates fell, but I figured, way back then, that it was the work of the Federal Reserve. I don't know. Maybe I'm remembering wrong, or I got it wrong at the time.

I remember Ronald Reagan as a union-buster, the guy who fired the air traffic controllers when they went out on strike. I guess I'm the only one who remembers that strike and how Ronald Reagan screwed the air traffic controllers, because later, he got an airport named after him.

I remember Reagan as the guy who went to war against Grenada, a place we didn't even know existed until we attacked them. What was that war about? I don't remember. I don't think I ever knew. We won, though, and people remember that.

I remember the Iran-contra scandal, where Ronald Reagan was caught redhanded selling weapons to Iran and funneling the money to Nicaraguan rebels. His primary defense seemed to be that he was too befuddled to be held accountable for his actions.

Yeah, I remember Ronald Reagan, but I'm beginning to wonder if anyone else does.




Wednesday, June 02, 2004

Here's why you should never volunteer for anything:

Julie and I started out in dog rescue by offering to foster one, single dog, female, house-trained until the rescue lady, Randee, could find it a home. So we did that a few times, ended up adopting one of our long-term rescues (Treasure, the three-legged wonder), and real quickly we started getting frantic phone calls from Randee.

"I've got seven dogs and I know you already have one but could you take this darling little boy--I know you said you'd just take girls but he's very sweet--because I don't have anywhere else to place him and otherwise he'll be put to sleep...please please please?"

Six months later, we've gotten on Randee's weekly call list: "I've got eighteen dogs that will all be shot if...." and "I've got a hundred-and-sixty-four dogs that will all be ground up for taco stuffing if...." and so forth. Now I'm volunteering at adoption events, setting up and taking down canopies, transporting dogs, giving sub-cutaneous fluid injections, and wondering where my time has suddenly disappeared to. And of course, if I don't agree to foster fourteen dogs this weekend they'll all be...well, you don't want to know.

So be warned. Never volunteer for anything. These people are relentless.

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