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Surprisingly interesting book I didn t have a strong grasp on the history of the big cable companies They always just kind of seemed to be these huge entities with awful customer service Turns out, there s a long backstory there And it s interesting Cable Cowboys does a good job explaining it all as it follows John Malone and his team at Telecommunications Inc TCI.My big takeaways John Malone is the real deal as an executive His ability to craft win win deals with the biggest win for Surprisingly interesting book I didn t have a strong grasp on the history of the big cable companies They always just kind of seemed to be these huge entities with awful customer service Turns out, there s a long backstory there And it s interesting Cable Cowboys does a good job explaining it all as it follows John Malone and his team at Telecommunications Inc TCI.My big takeaways John Malone is the real deal as an executive His ability to craft win win deals with the biggest win for himself and avoid taxes was really impressive Fascinating to learn how cable started as this small time way to rebroadcast the signals of major TV broadcasters CBS, ABC, NBC and grew to be the absolute behemoth it is today.I generally feel like executives in major corporations are mostly competent, but hardly exceptional when you consider that most of them have been working full time in their fields for multiple decades When accounting for all that time, they mostly seem pretty normal, nothing surprising in terms of ability But John Malone seems to be an exception He is an executive where you look at the amount of time he put in and he still comes out looking impressive He seems to be genuinely much better than average at seeing how to make deals with upside for both parties Combine that vision with an exceptional ability to execute and convince potential competitors to partner with him, and it s pretty clear the man is the real deal.It was also really interesting to learn about the cable industry as a whole It began as a means to give rural towns access to the shows from major broadcasters Early cable companies would put a big receiving dish on top of the nearest big hill, then run a wire the cable back into the rural town and hook up people s TV sets The economics of it are particularly interesting The major broadcasters made money on advertising, and didn t charge customers to receive the signal But cable companies didn t have access to the ad revenue, so they charged customers a monthly fee to access the signal of the major broadcasters This paid for the maintenance costs of fixing the wire, and allowed for a small profit Some visionary cable pioneers the cable cowboys in the book realized that it was in their interest to try and get as big as possible, and wire as many homes as they could So they set off reinvesting every dime they had in the business and begging banks to let them borrow as much money as possible Banks were reticent to do this because the cable companies never really had cash flow, only revenue growth, and banks thought this was risky times are different now, seeSo the cable companies at least TCI, the focus of this book were in a constant battle with banks to get the capital they needed to finance their growth and pay off their bills This whole system mostly worked, as long as the bankers went along, which they tried their hardest not to But Malone and Magness and the other cable cowboys eventually prevailed in every battle But even as they continued to expand, cable companies were pretty much beholden to the major broadcasters, who were the source of all the content on the cable networks So in that era, the upside from cable companies always seemed a bit capped When broadcasters controlled the signal, you had to figure cable companies had a ceiling on their financial upside In short, the cable companies had a distribution problem This changes in the 70 s, when HBO becomes the first major cable channel to be transmitted via satellite The breakthrough moment is when HBO broadcasts the Thrilla in Manila live, while the other major broadcast networks have to air the fight on tape delay HBO demonstrated that satellites could be used to circumvent the distribution channel established by the major broadcasters At that point, cable began to really take off, and many, many new channels sprang up to take advantage of this new way of reaching viewers And Malone was really smart to realize that he wanted to partner with as many new cable channels as possible, so that TCI would have upside in case the competitive landscape of cable ever tilted in favor of the channels over the cable companies Malone was a master dealmaker throughout the entire story In any case, cable was really doing well, and it entered an era known as the franchise battles In this era, well financed companies would come in to bid for cable licenses in various municipalities, because these licenses were basically a regulated monopoly Unfortunately, the companies overbid on the licenses, overspent on installing state of the art systems, and overpromised their shareholders about revenue projections from cable Lots of people lost money But, when those companies were ready to bail out of cable, Malone and TCI were ready to scoop up their leftovers for cheap and run the wires profitably Worked out great for Malone At this point, there is a lot of consolidation going on in the cable industry, and TCI is becoming pretty huge With this consolidation come really large price increases and really awful customer service This pisses off pretty much everyone, so the government comes in In the mid 80 s the federal government takes over regulating cable companies, so municipalities don t have to worry about that any The gov t imposes pretty austere rate reductions, and the cable companies start hurting It s particularly rough because the cable companies are still usually running with pretty heavy debt loads But, you don t feel too bad for em because they were pretty huge assholes and largely continue to be And it s not like these guys didn t make plenty of money Anyways, this continues for a bit, until the early mid 90 s when the federal government decides to deregulate the telecom industry to increase competition Well, this sets off another consolidation bonanza, and this time, Malone is ready to get out of cable altogether He organizes a pretty sweet deal to have ATT buy up TCI, and, with a few bumps after the deal closes, rides off into the sunset The cable companies then go on to start delivering internet phone service, and now, here we are Overall, it s really interesting to see these huge names in cable ATT, Cox, Comcast, etc and learn about their origin story If only it could end up with those companies providing better customer service, but then again, that s a lot to expect from a monopoly even a regulated one My main complaint about the popular finance book The Outsiders Eight unconventional CEOs by Thorndike was that there wasn t enough detail about each individual person Well this book certainly checks the John Malone box Cable Cowboy was a comprehensive and thorough review of his amazing career at TCI Financially gifted, Malone was also a ruthless deal maker and operator that managed to become the preeminent cable and media industry tycoon.Pretty much a must read for anyone that has an in My main complaint about the popular finance book The Outsiders Eight unconventional CEOs by Thorndike was that there wasn t enough detail about each individual person Well this book certainly checks the John Malone box Cable Cowboy was a comprehensive and thorough review of his amazing career at TCI Financially gifted, Malone was also a ruthless deal maker and operator that managed to become the preeminent cable and media industry tycoon.Pretty much a must read for anyone that has an interest in business I d say Also on a personal note, he instantly became my hero once I learned that his nickname is Darth Vader , given to him for being such a tough and bad ass negotiator and business man I first read about John Malone in Joel Greenblatt s legendary book You can be a stock market genius Later I read about his again in The Outsider s by William Thorndike Few things about him stood out He was all about cash flow while Wall Street concentrated on accounting earnings Secondly, he used leverage exceedingly partially to reduce effective tax rate And he liked to acquire companies Some of the things Malone did are similar to whathas done later on long term horizon, cash I first read about John Malone in Joel Greenblatt s legendary book You can be a stock market genius Later I read about his again in The Outsider s by William Thorndike Few things about him stood out He was all about cash flow while Wall Street concentrated on accounting earnings Secondly, he used leverage exceedingly partially to reduce effective tax rate And he liked to acquire companies Some of the things Malone did are similar to whathas done later on long term horizon, cash flow focus etc Cable Cowboy explains his story indetails Unfortunately for me the book was less about the techniques he used butabout the ups and downs he faced It was still a good read and I would recommend it If I could give a 6 on 5.What a wonderful book, brilliant writing it s a story that flows well, had great facts, is deep and broad at the same time.Covers the evolution of the US cable industry from the 70s to the 2000s and what a journey it had been Most people now would not know of this wonderful history of monopolies and cable cowboys riding the wave John Malone has been cited as an Outsider in William Thorndike s book and the Cable Cowboy goes deep into making the reader realise why h If I could give a 6 on 5.What a wonderful book, brilliant writing it s a story that flows well, had great facts, is deep and broad at the same time.Covers the evolution of the US cable industry from the 70s to the 2000s and what a journey it had been Most people now would not know of this wonderful history of monopolies and cable cowboys riding the wave John Malone has been cited as an Outsider in William Thorndike s book and the Cable Cowboy goes deep into making the reader realise why he was so damned good It s not at all rosy, there are dark and questionable sides to the man too.His relation with his family and with Magness are intriguing, and his thirst for challenging authority has been chronicled so well.My review doesnt do justice to the book.For a capital allocator and promoter of shareholder wealth, who turned 75 cents into arguablythan 800 over 25 odd years, may be 30 just pick up this book and read this amazing man s journey This review has been hidden because it contains spoilers To view it, click here I really enjoyed this book, but have to admit the financial transactions and details within were hard to follow John Malone s financial acumen was what I admired most about this book from creating a new metric EBITDA to his single focus on creating shareholder value through tax deferrals and tracking stocks it was amazing to read about this aspect of his life A few other threads I enjoyed were understanding where value is created in the cable industry, always have alternatives with suppl I really enjoyed this book, but have to admit the financial transactions and details within were hard to follow John Malone s financial acumen was what I admired most about this book from creating a new metric EBITDA to his single focus on creating shareholder value through tax deferrals and tracking stocks it was amazing to read about this aspect of his life A few other threads I enjoyed were understanding where value is created in the cable industry, always have alternatives with suppliers great story re Gates trying to be the cable box for the cable industry and cash flows versus earnings Here are the key takeaways I took from this book 1 Despite its reputation as a risky play, through 1997, TCI outperformed every other stock in the market A single share of TCI, purchased at the low 1974 of 75 cents, was worth 4,184 by the end of 1997 a 5,578 fold increase introduction ix 2 Great summary on why the cable business model is genius page 14 3 How Malone developed intuition to see answers before his rivals did page 25 4 After tax cash earnings simply didn t count what counted was cable prodigious cash flow, funding TCI s continual expansion page 45 One of the great parts of the books, which explains why cash flows matterthan earnings GREAT passage here 5 How the Ali Frazier fight transformed the economics of cable TV helped launch HBO page 52 6 When Malone s realized the power of programming and how TCI could own both the pipe and the water flowing through it page 59.7 A Cable franchise was essentially a legal right to a local monopoly operations had to answer to local government and win approval for rate increases page 62 8 Malone s strategy business thinking amazing process page 779 A paragraph that sums of the entire book Forget about earnings That s a priesthood of accounting profession, he would preach What you re really after is appreciating assets You want to own as much of that asset as you can then you want to finance it as efficiently as possible And above all else, make sure that the deals you do avoid as much in taxes as is legally possible And then some page 81 literally sums of the key points of the book here 10 Malone s thought on running a highly decentralized business page 84.11 Malone s business philosophy explained page 105.12 The creation of Liberty Media and the thoughts behind separating distribution content page 112 The favorable Liberty Media set up that Malone created from the spin but that few understood at the time.13 Redstone sued Malone in 1993 in his opening words of his lawsuit Redstone summarized the key issues the American Consumer Competitors had with Malone largely his monopoly power over the entire cable industry supply chain page 135 14 Thoughts on tracking stocks page 159 and page 247.15 The cable industry s unique position as the 1990s set out the internet could not exist without the fat pipes of the cable industry page 213 16 ATT has non owners of the business control vs good business economics page 265 great section on why founders run a business SO much better If you work in the media industry it s a must read, it s a very interesting and insightful book. This tome seems to have a lot of good business lessons, and I would say that is its strength, rather than an interesting story line The first few chapters the story of Malone s childhood and experience at college were actually interesting Even the story of his first job and how he came to Tele Communications Inc TCI were good But after the author gets Malone to TCI and describes the challenges Malone is going to face, the book becomeslike a 250 page case study of the cable industr This tome seems to have a lot of good business lessons, and I would say that is its strength, rather than an interesting story line The first few chapters the story of Malone s childhood and experience at college were actually interesting Even the story of his first job and how he came to Tele Communications Inc TCI were good But after the author gets Malone to TCI and describes the challenges Malone is going to face, the book becomeslike a 250 page case study of the cable industry or maybe any industry where a business faces crushing debt but excellent cash flow like ATT today.For a business that can be successful under the conditions described above crushing debt and excellent cash flow , I think it will always mostly be a capital intensive monopoly After listening to Malone s tactics over promise to cities, then litigate to prevent them from bringing in a new cable company , I don t know whether to revere Malone or hate him As a consumer, I couldn t help but feel that he is everything wrong with business owners Horrible customer service week plus response times to malfunctioning equipment , failure to upgrade networks when TCI signed agreements to do so, and hardball tactics like shutting off programming or suing cities who tried to get TCI to fulfill their agreements.I think the truth is that the cable model was to lie about cable capabilities and then charge customers less than what was necessary to really have a good cable network It seems to me that customers cities didn t want to pay the true price to get the services they wanted On the other hand, it seems super shady to promise what you can t deliver at a price point.Also, all the financial engineering made me want to vomit John Malone is smarter than everyone else and wanted to make sure no one could understand his financial transactions until he got the money he wanted out of those transactions At the end of the book, after the sale of TCI to ATT, it becomes apparent how much better Malone understood the cable industry than Michael Armstrong However, because of Malone s penchant for self dealing, Armstrong never trusted him, and the TCI acquisition turned into a horrible mistake &READ KINDLE ⇔ Cable Cowboy: John Malone and the Rise of the Modern Cable Business ↵ An inside look at a cable titan and his industry John Malone, hailed as one of the great unsung heroes of our age by some and reviled by others as a ruthless robber baron, is revealed as a bit of both in Cable Cowboy For than twenty five years, Malone has dominated the cable television industry, shaping the world of entertainment and communications, first with his cable company TCI and later with Liberty Media Written with Malone s unprecedented cooperation, the engaging narrative brings this controversial capitalist and businessman to life Cable Cowboy is at once a penetrating portrait of Malone s complex persona, and a captivating history of the cable TV industry Told in a lively style with exclusive details, the book shows how an unassuming copper strand started as a backwoods antenna service and became the digital nervous system of the US an evolution that gave US consumers the fastest route to the Internet Cable Cowboy reveals the forces that propelled this pioneer to such great heights, and captures the immovable conviction and quicksilver mind that have defined John Malone throughout his career This is the story of John Malone nicknamed Darth Vader by Al Gore who took Liberty Media from a middling little cable operation in Denver to become one of the most important players in the cable television industry One of the most important takeaways from this book is the importance of focusing on both value creation the tech and capturing a non trivial fraction of the value you create the business model Malone will go down in history as one of the greatest financial alchemists the wor This is the story of John Malone nicknamed Darth Vader by Al Gore who took Liberty Media from a middling little cable operation in Denver to become one of the most important players in the cable television industry One of the most important takeaways from this book is the importance of focusing on both value creation the tech and capturing a non trivial fraction of the value you create the business model Malone will go down in history as one of the greatest financial alchemists the world has ever known and the deals he made were byzantine, exotic, and downright confusing A few times I had to draw a financial UML diagram to even have the vaguest sense of what Robichaux was describing Central to these deals was the use of debt financing, and the deferment of taxes to avoid any leakage of economic value The bottom line was that Malone believed that the only thing that mattered was creating value for shareholders and the best way to do that is to have a very long time horizon In short, this book is an unbelievable look into what was once the most important industry in America before the internet Malone is also quite the character which makes the book humorous in a way that biographies typically are not It started out great The first quarter or so was very interesting, telling how cable operators got started, when TV was a new phenomenon, sweeping the nation There was some picturesque description of how cities were connected to better TV reception, via microwave towers on hilltops and poles carrying cable snaked their way into the valley.Unfortunately the rest of the book gets very dry If you re interested in business and investing, you probably won t find it a worthwhile read, given the tim It started out great The first quarter or so was very interesting, telling how cable operators got started, when TV was a new phenomenon, sweeping the nation There was some picturesque description of how cities were connected to better TV reception, via microwave towers on hilltops and poles carrying cable snaked their way into the valley.Unfortunately the rest of the book gets very dry If you re interested in business and investing, you probably won t find it a worthwhile read, given the time it takes to slog through all those pages.There is diligent rattling off of what percentage stake in which company another company took and how much money in stock and cash changed hands But as far as valuable insights Had it been told in half as many pages, easily could have been a 4 star book