1994 -- The Year of Heartburn
Many important things would happen in 1994, we would produce the pilots, hire some really great people, lay the foundations of the CNET brand, meet Paul Allen and do everything we could to convince some network to give us a shot on air. This week I wanted to spend time on the later. To say this was the low in my professional career is not a stretch and I would later live through an SEC investigation which gives you a window into how this year went.
First thing, this was the year that Marshall Cohen managed to keep us all with even a small degree of hope. He couldn’t have been more supportive and was an amazing advocate for us.
As I mentioned before, thanks to Marshall we were in the midst of discussions with Discovery at the beginning of the year. Discovery was founded by John Hendricks with funding from Allen & Company and was based in Washington DC. In 1994, Ruth Otte was the CEO and had worked with Marshall.
We knew this was probably our best fit since the already had a technology program, Next Step, and had a broad focus on science, weapons, nature, etc. At some point in the first quarter, we had our big meeting with them. We did our dog and pony show and thought we were really making headway. Then the head of programming says to us, “I realize computers are popular hobby but so it photography and there is no TV programming about photography.” Scratch Discovery off the list.
We would try a whole bunch more networks. At some point, we would ask Frank Voci to create rundowns for some network. Rundowns were kind of like show overviews and Frank would tailor our current programming to whichever network we were trying to pitch. If you could think of a network in 1994, he probably created rundowns. He started to worry about state of the company when we asked for rundowns for Black Entertainment Television which was primarily music videos at that point.
Much of the second quarter was spent trying to convince MTV Networks, the cable programming group of Viacom, that we would be a great fit for one of their channels. The best candidate seemed to be VH1 which was the older version of MTV and had struggled to find programming that could garner a rating. They ran old syndicated shows like WKRP in Cincinnati. I guess because it involved a radio station it fit under their brand?
Thanks to Marshall, we had been speaking since the Fall with Ed Bennett, who ran VH1. Additionally, we had been working with Tom Dooley who ran all Corporate Development for Viacom, VH1’s parent. After a very thorough and stressful dating process, early in July on a Friday, Ed told us we would go forward with a deal. We had his approval on the general terms we had proposed and would just have to paper the deal. Halsey always said you don’t have fun at business, by the time something good happens, like this deal, you would have so assumed it that it seemed anti-climatic. On the flip side, you are surprised by the disappointments.
Here is the rundown we produced for Ed Bennett and his team.
Then came Monday, we read that Ed Bennett had been fired and replaced with John Sykes. The branding a logo of the network was being changed to VH1: Music First. The press released talked about how John was being brought in to take them back to their music roots. This was the new logo:
Now if you are trying to pitch technology programming to this network, you know you have a problem. We were told John Sykes would look at the proposal as he got his feet underneath him. As an entrepreneur you are an optimist, so we kept thinking that we could convince John that The Center of the Digital Universe was a place he would need to embrace. That said, we still knew we were in trouble.
Thus, we entered the pushing a string portion of this endeavor. We would try to reposition CNET Central as The Digital Beat to be more music-themed. We kept trying to go the Tom Dooley route hoping that he might intervene.
Here are some of the documents:
My notes on a potential letter to John Sykes.
A letter to Jill Newfield to BD person at VH1.
The model for the economics of the arrangement.
The proposed deal for John Sykes. The date obviously changed to current. Not sure of the actual date.
This low point of my professional career was flying to New Orleans with Halsey and Kevin to attend the The Cable Show with the single objective of getting in front of John Sykes. We would sit outside his little conference room at the show for hours turning into days trying to find time when we could squeeze in and speak with him. It was embarrassing and fruitless. As great a city as New Orleans was, each of us would go home to our hotel rooms knowing that this was not going well, order room service and try to hope for better days. I am sure Kevin who had a pretty substantial career prior to this, was rethinking his choice. How can it be this hard to get a show on VH1 that we would guarantee was profitable for them?
We would call Sykes as much as we thought was not too obnoxious. We got the point where we knew we could call no more than once a week. Every time we called, he wasn’t available and they said he would call us back. Everyone in the company was on watch for a John Sykes call. It is all we waited for. We go to staggered lunch to make sure there was always someone to answer the phone. The funny thing was that if we were gone for 5 minutes he would call and leave a voicemail. This didn’t happen once it happened three or four times. Later on it would dawn on us, that his secretary would call and if they got no answer and it went to voicemail she would put him on and leave a message. To say we were frustrated, would be an understatement.
The whole thing was just pitiful. If you ever start a company, know that there will be some pitiful moments. Also, if you are ever the equivalent of John Sykes, you would do the company a favor by telling them the truth and not dragging them out. We were caught in neutral just hoping he would call and one of us would be there to answer the phone.
There was an additional problem, we needed money. We were in mid-discussions with potential funders and knew that if the deal officially went away, we were nowhere. That is for another week……….