HSN

"We would ultimately merge QVC with HSN more than twenty years later. And even with the rise of Amazon and online shopping, TV shopping remains a valuable business, with QVC, HSN, and online retailer Zulily delivering nearly $11 billion through the QVC Group. Yielding to a better, smaller competitor taught me that when you lack a special expertise, it is better to own a small piece of a thriving enterprise rather than to own 100 percent of a struggling one you don’t know how to run."

"Eventually, the ordering system was replaced, and sales grew. But we were still not up to par with the Home Shopping Network. And over in Philadelphia, a fellow by the name of Joseph Segel was doing a much more elegant job of selling merchandise on a network call QVC. Joe was a polished businessperson who had founded the Franklin Mint, which ran sophisticated ads in magazines to sell commemorative coins, medallions, figurines, and other collectibles. He, too, had seen HSN and launched QVC as the Saks Fifth Avenue to HSN’s Walmart. QVC’s hosts were smoother, and its merchandise comprised of more high-margin products. So TCI took an equity stake in QVC, along with Comcast and others. Literally dozens of companies announced new shopping networks, far too many for the market to support. And the market quickly thinned out. The Fashion Channel, in which TCI owned a stake, would go bankrupt and be folded into CVN. Many retailers saw the vision, but few could make it work in time. Still, there was opportunity for the right player."

"It was kind of pathetic that this little toad of a company was all that seemed to fit my minimum conditions. Hoping he wouldn’t laugh at the idea, I told John Malone I’d take Silver King, but only if I could also get control of HSN itself (Malone’s Liberty Media owned a controlling stake in it, too). I still believed home shopping was the entrance to e-commerce. QVC had steadily taken market share from HSN, which had been mismanaged for many years and was losing money, but I knew enough about the category to be sure I could turn it around. The problem was that HSN had been accused of various fraudulent practices and was in a legal mess with the Justice Department. That asset was frozen for now, so my only option, pitiful as it was, was to take Silver King and await HSN’s unfreezing."

"If I had succeeded in buying Paramount or CBS, I know two things for certain. One is that I would never have been able to control either—I’d have still been an employee and most likely been thrown out at some point. And I’d never have become an internet entrepreneur. Big word, “entrepreneur.” I wasn’t a natural one. I was a tried-and-true corporatist with more than a master’s degree in managing large enterprises. It had been decades since I’d started anything from scratch and my first moves were pretty mundane. We had these two dreary assets, HSN and Silver King, and while turning around HSN wasn’t going to excite anyone, it did give us cash and some credibility to think about expansion. I wish I could say I saw the possibilities of the internet in some full-blown prophetic way. I didn’t. But inside the humdrum reason I wanted to buy Ticketmaster was the seed of what would consume me for the next twenty years."

"The prerequisite for my agreeing was that John Malone would give me a bulletproof lifetime proxy on Liberty’s controlling interest in Silver King as well as a large ownership stake in it and eventually HSN. Control, my hard-ass mantra, would be hardwired, but it sure was small beer."

"You do get lucky when you buy a company that has been mismanaged and yet is still running. Running on fumes is still running, and if you’re compelled to be willful and tough minded it doesn’t take a rocket scientist to figure out the few simple things needed to turn one around. Within a year of me taking over, HSN went from losing $70 million to making $60 million."

"I didn’t know any of this when I cold-called Paul, thinking he might find the idea of a combination of Ticketmaster and HSN compelling. He told me of his frustrations with Rosen, and how he believed the company should jump-start online ticketing. Eureka—that was the seed and… suddenly I did see the future and got so excited about the online possibilities that I couldn’t race fast enough to get a deal done. I told Paul that if he traded his stock in Ticketmaster for stock in HSN, I’d deal with Rosen and he could get out of that tortured relationship. I’d dealt all my life with far more obstreperous characters. Paul Allen quickly agreed and ended up with 11 percent of my company and joined our board. A year or so later he sold his shares, doubling his money (not that he needed it, but if he’d kept his shares, he’d have become far richer than the Midas he already was)."

"I was close to hopeless as I neared the end of my meandering up the Intracoastal. Could I end my career with such a whimper? Where could I find the match that would light my next move? I was down to less than a matchstick when I spoke with John Malone early in 1995. I told him the trouble I was having finding something to get me off zero. Joking and dismissive, he said, “Well, I control Silver King. You can have that if you want.” Silver King? What the hell is that? It turned out to be a string of UHF television stations that didn’t actually broadcast anything; they were repeater stations for the programming of the Home Shopping Network. HSN was the forerunner to QVC. It actually invented the interactive-shopping category. Silver King had revenues of only $40 million a year with no prospects other than its income from the Home Shopping Network."

"I thought there were synergies with HSN’s call centers. It had 2,500 people taking phone orders for merchandise, and Ticketmaster had 1,000 taking ticket orders; we thought combining the back office of the two businesses would save money and be much more efficient. It was a basely pragmatic move, hardly inspired or aspirational."