AT&T

"There was a bigger game under way. Though they flattered Yankowski with attention, RIM’s partners had no interest in selling their company. They took Yankowski’s calls, showed up for meetings, and swapped boasts to keep him off guard. “Most people’s instincts tell them to seek clarity in business dealings, but ambiguity is more powerful in my view,” Balsillie explains. “You’d be surprised how long you can string competitors along without ever showing your cards.” An unsuspecting Yankowski pursued a takeover of RIM for months. Throughout Yankowski’s courtship of RIM, Balsillie downplayed his own company’s abilities and ambitions—flashing what he calls the “Aw, shucks card.” BlackBerry, he told Yankowski, was a small niche device lacking the global appeal of Palm. He talked of licensing Palm’s operating system and continually asked what RIM should do next. “That seemed to be his primary preoccupation,” Yankowski says. That’s exactly what RIM wanted him to think. “My objective,” comments Balsillie, “was to get him to underestimate RIM.” When Balsillie joined Yankowski in San Francisco for dinner later in 2000, the RIM chief pulled out a prototype of an upgraded BlackBerry, called the 957, which shared many of the features of the latest Palm device, including a large, square screen. He handed the model to Yankowski, who was suddenly full of questions: “What network will RIM use for this BlackBerry?” “We haven’t told anybody yet,” Balsillie replied. Eyeing the screen, Yankowski flashed Balsillie a big grin. “That’s okay. I already know.” “What do you mean?” “It says right here.” Yankowski pointed to the letters CDPD in the top right corner of the screen. CDPD, short for cellular digital packet data, was a wireless data network technology heavily promoted by its creator, AT&T. So that’s what RIM’s up to: dumping Mobitex for CDPD, Yankowski figured. Palm was already testing its next device on the CDPD data network. Balsillie was still giddy when he caught up with David Yach, a Canadian engineer who had been recently hired away from California software maker Sybase as RIM’s chief technology officer. Joining Yach in RIM’s jet, Balsillie blurted out: “He fell for it!” In fact, what he showed Yankowski earlier in the evening was a decoy with the screen changed to read CDPD by one of Yach’s engineers, with the specific intent of fooling the Palm boss. RIM had no interest in CDPD. Lazaridis viewed it as technically inferior technology, correctly predicting it would soon be dead. If Palm wanted to jump to CDPD, that was fine with Balsillie. For now, RIM was sticking with Mobitex, a slower but more reliable messaging highway. Yankowski has no recollection of the San Francisco dinner, but he remembers what happened soon afterward. Takeover talks broke off abruptly when Balsillie said he would have no part of a deal that did not hand him full executive control of the merged company. The petulant demand by a firm with one-twelfth the revenues of Palm seemed…"

"The handcuffs finally came off the industry when President Ronald Reagan signed the Cable Communications Policy Act of 1984 into law, the first national legislation establishing the federal government’s authority over cable TV. Its biggest impact was the deregulation of monthly cable rates where there was “effective competition” from at least three over-the-air broadcast signals in the market, which included most markets. Cable operators could now charge what the market would bear. Cities could still grant franchises, but fees paid to government were capped at 5 percent. Incumbent cable operators, usually the ones who had laid down the wire, were favored in franchise renewals. And phone company giants like AT&T were forbidden from owning cable operators, removing a competitive threat."

"As I was finishing my coursework for my PhD, I was assigned to work on some large-scale models of the Bell System for AT&T. Many of the projects allowed me to study ways to make significant improvements not just in operations, but finance as well: debt leverage, depreciation schedules, taxation—the big-picture stuff I loved to contemplate and calculate. This gave me the opportunity to build a mathematical model of the Bell System itself."

"There was no natural connection to the US for New Zealanders until Sky bridged the gap, Tataurangi thinks. His mother was a keen follower of sports and subscribed to Sky. ‘Sky opened my eyes to the PGA Tour,’ he says. He would watch professional golfers play in places like Cincinnati, then he would go and look up Cincinnati to find where it was and to learn more about the course. He says Sky lit the fire for him to go to America, which he did in 1994 when, aged 22, he was the youngest golfer on the tour. The most useful preparation he had, apart from practice, was having watched Sky. Consequently, when Heatley asked him if he would like to play the 2003 AT&T with him, Tataurangi had no hesitation in accepting. ‘Up to that point I was just aware of who Craig was and what he did and that he was a keen golfer, a friend of the game, knowledgeable and he always had a great yarn to tell, which as a young, impressionable person you always remember,’ Tataurangi says. A golf championship—with hours spent together each day through all the hopes and disappointments of a competition—is a fast way to learn someone’s character."

"William McGowan was able to launch MCI to compete with AT&T. Ted Turner was able to create Turner Broadcasting. Hundreds of millions of dollars were raised through the sale of junk bonds and used to build new companies."

"McCaw gave Hopper extraordinary freedom to design and close the deal. Hopper loved the independence, but sometimes when he wanted to confer with McCaw, he couldn't find him: McCaw would be kayak- ing or flying somewhere or busy with the cable division. The idea that this might inconvenience his executives would have astonished McCaw, who felt he was giving them a gift by not being around. "If somebody's got the ball, it is theirs to run," says McCaw. "If I hang around and act important and give orders, I'm going to wreck the whole thing." So he kept his hands off the AT&T negotiations. "I don't think McCaw met an AT&T executive until years after," Hopper says."

"The McCaw offer put LIN into play, because management did not own enough of the company to unilaterally reject a buyout. Now anyone could top the McCaw offer. But the McCaw team had planned its moves carefully, having studied LIN's finances, its management, and its strategic position, as well as other potential bidders, such as South- western Bell, US West, and even the big-daddy long shot, AT&T. Perry called it "reverse engineering" any potential opposition, and it wasn't that hard to do. Because of McCaw's many partnerships and the avail- ability of public documents filed with the FCC, positions were relatively easy to assess. "That was all in the mental database," says Perry. "If you have to hire people to come in and do that, it would have taken forever." As a result, "we knew more about LIN Broadcasting, the people who could buy LIN, the regulatory issues, the taxes, the [legal"

"What lies ahead for Craig McCaw? Expect the unexpected. He could spend years staying on course, expanding his companies, and enjoying the result. But just as his face begins to appear again on the covers of magazines that celebrate his triumphs, look for a change. He hates routine. He gets restless when a venture begins to succeed and his presence is less essential. Having built and sold two national companies, McCaw could wake up one morning and decide to sell one or all of his present companies. One possible scenario would be a sale of Nextel to a bigger company that needs a wireless presence, or a sale of Teledesic to a huge global player such as AT&T. There could be important strategic reasons for such a sale, but he wouldn't sell his empire merely for strategy or money, but to move on to new challenges. Or he would find a way to make his routine more interesting. He could pull in new partners, raise his bets,"

"It's always a two-edged sword. If people know what you're trying to do and they recognize that it's a good idea, they may try to do it themselves. So that really put us in the course of doing one of two things: either being enemies [with AT&T] or friends, because once they launched on it and they realized that this was a good idea to be in the service side of the business as opposed to the manufac- turing side, we really had a choice, which is we're going to meet them in the marketplace head-on or we're going to work together. Because we wanted them to be a great manufacturer, it was actu- ally a fairly tough issue. So we went along and said: Well, where will this go?"