Cable Cowboy: John Malone and the Rise of the Modern Cable Business

by Mark Robichaux

Magness learned to listen instead of talk, and within a short time he could read a customer like a poker player, anticipating what that person wanted from the deal moments into negotiation.

continued to seek counsel from his father, who one day gave his son puzzling advice about taking tests: "Guess at the answers," he said. John gave him a perplexed look. "Guess before you figure the problems out," Dan repeated. Uncertain at first, Malone quickly developed an intuition for engineering questions that called for empirical data. Malone was amazed at how quickly he could derive a number, how he could guess what waveforms would look like at the end of a circuit even before doing the underlying mathematics. This ability to make split-second calculations served him well throughout his school days, and it became the one weapon in his arsenal-to see the answers before others did-that gave him an edge over future rivals.

The visits were also crucial to embodying the main rule he learned at McKinsey: Listen.

With a vision of TV viewers responding to polls and educational programming, the FCC required all cable operators to have two-way capability even though the upstream path would be rarely used for nearly two decades. Malone was ready with a new two-way amplifier at Jerrold, and the company's market share for cable equipment exploded, to about 80 percent from about 35 percent; profit margins soared by consequence.

Cable was shedding its skin again. It had begun as a low-cost antenna service to tune in the big networks. In its second evolution, cable was the fount of dozens of new programming services, from HBO to CNN. Now the wire had found a life that no one would have dreamed of just a decade earlier. It would make PCs and TVs a lot more alike