CEO Brian Roberts turns Comcast from bit player to center-stage force
Comcast CEO Brian Roberts has shown a keen instinct for the deals that transformed his family firm into a national media powerhouse bigger than potential rivals such as Verizon and Disney.
The New York Times
Comcast CEO Brian L. Roberts
Roots: A son of Ralph J. Roberts, who founded Comcast in 1963 and at 93 remains on the board.
Career: Started working as a Comcast intern at age 15. Eventually went out on service trucks, installing TV service in people’s homes. Became Comcast president in 1990, CEO in 2002.
Comcast stake: Has sole voting power over 33.3 percent of Comcast stock.
Compensation: Total cash and other compensation for 2012 was $29.1 million.
Sources: Company reports, Bloomberg News
Three weeks ago, Comcast unveiled plans to build an addition to its headquarters, a gleaming steel-and-glass tower that will cast a shadow over downtown Philadelphia.
With its proposed $45 billion takeover of Time Warner Cable, the company could do much the same over the media and telecommunications landscape.
The deal, announced Thursday, solidifies Comcast’s reputation as an enterprise with grand, even audacious, ambitions. Begun 51 years ago with just 1,200 subscribers in northern Mississippi, Comcast has grown into a giant conglomerate that now has one foot in the broadband and cable businesses and another in content, thanks to its ownership of NBCUniversal.
If approved by regulators, it will make Comcast a national player, adding millions of subscribers in major markets like New York City, Dallas and Los Angeles.
The move further establishes the reputation of Comcast’s chief executive, Brian L. Roberts, as a daring dealmaker with expansive ambitions. A soft-spoken 54-year-old, he lacks the outsize personality of an executive like Rupert Murdoch but has nevertheless become an influential mogul, with power centers in both Philadelphia and Manhattan’s 30 Rockefeller Center.
“Brian Roberts is a fascinating combination of technology visionary and business strategist,” Craig Moffett, founder of research firm MoffettNathanson, said in an interview. “He saw the major technology developments of the industry well ahead of everyone else and has positioned his company brilliantly to take advantage.”
Roberts has already made a strong start with Comcast’s X1 TV interface. It mimics and in some cases surpasses what Apple and Roku offer, including digital streaming of TV shows and films as well as cloud storage. Comcast also started selling downloadable movies and TV shows much the way Apple does via the Apple TV box.
Comcast reported $6.8 billion in profit on $64.7 billion in revenue last year. Its competitors now include companies as varied as Verizon in broadband and the Walt Disney Co. in entertainment. Yet with a market capitalization of $138 billion, it is bigger than either, and more diverse.
Roberts, whose father, Ralph, founded the company in 1963, has deep roots in the cable industry. He spent some of his teenage years as an intern answering service calls and repairing cables. But over time, he developed what analysts and friends call a sharp mind and a killer instinct, unafraid to pursue high-priced takeovers.
“Fifteen years ago, a lot of cable entrepreneurs of my dad’s generation began selling their companies, and we wanted to buy,” Roberts said in a telephone interview. “We wanted to create a company that was sustainable.”
Behind the $100 billion in deals he has overseen has been a belief the company could compete across a variety of platforms with Verizon, AT&T and DirecTV. And he foresaw the importance of high-speed data early on, according to John Doerr, the prominent venture capitalist, who became friends with Roberts in the 1990s.
Roberts recalled that when Bill Gates invested $1 billion in his company in 1997, the Microsoft billionaire told him that data would be a bigger business than video one day.
“I didn’t know what he was talking about then, but he was right,” Roberts said.
Over the years, Roberts assembled a management team that has won praise for its acumen, including Neil Smit, the former Navy SEAL who will oversee Comcast’s expanded cable businesses, and Michael Angelakis who, as Comcast’s chief financial officer, oversaw the negotiations with Time Warner Cable.
On the team is Stephen Burke, who left Disney 16 years ago to join Comcast when it was still a small-time player. He has since become the head of NBCUniversal.
“I had a lot of people sort of scratch their heads and say, ‘Why would you go to a little regional cable company?’” Burke said in an interview. “I went because I was convinced at the time — and I was right, more right than I knew — that Brian wanted to create the next great American media company.”
Roberts has long been a top negotiator in his company’s deals. Doerr, a top partner at the investment firm Kleiner Perkins Caufield & Byers, recalled negotiating against his friend in a broadband deal in the late 1990s. He said he needed to take a nap under a table late one night while Roberts kept going.
But it was the acquisition of AT&T’s cable business for $47 billion 13 years ago — beating rivals like Time Warner in the process and becoming the country’s biggest cable provider — that first revealed the scope of Comcast’s ambitions.
“Once we got big in distribution, we looked at people like Rupert Murdoch and John Malone and just felt in our bones that content and distribution together worked well,” Burke said. “So once we were of size on the cable side, we turned to look to a content company to buy.”
The next deal was even bolder, but it didn’t end well: In 2004, Comcast made an ill-advised bid to acquire Disney for $54 billion, setting off a revolt among its shareholders, forcing Roberts to admit defeat and bide his time for another media property.
Avenue to acquisition
A secret meeting on an Idaho golf course in summer 2009 provided that avenue. Jeffrey Immelt, General Electric’s chief executive, told Burke and Ralph Roberts that GE was willing to part with NBCUniversal. Months later, Comcast announced a deal to take control of the NBC media empire.
The acquisition satisfied Roberts’ urge to plant a flag among the major media companies. But it did not tamp down his instinct for pushing Comcast to stay ahead of the technological changes roiling the industry. Those changes only further stimulated Roberts’ inclinations to expand and tinker.
Comcast still lacked the national cable presence that Verizon and AT&T had, limiting how broadly it could promote new media services like advanced video on demand. The company’s management seemed in no rush to take that next step, but when Time Warner Cable finally called upon its rival for help in fending off a hostile bid by Charter Communications, Roberts and his team struck, quietly negotiating the deal in less than a week.
Comcast has shown few signs of sitting still. Last month, the company suggested that it planned to team with a utility to sell electricity in Pennsylvania. And it has already begun offering home security and automation through its Xfinity services.
“I don’t think of it as a cable company anymore,’’ Doerr said.
Information from Bloomberg News is included in this report.