The Thinker

The incisive Jeffrey Bewkes has a bold new vision for Time Warner

Timeline: Time Warner

In the mid-1990s, in an effort to bond with one of his key executives, Ted Turner invited Jeffrey Bewkes to an Atlanta Braves baseball game. It was an odd choice of venue: for one thing, Bewkes, then head of HBO, was based in New York; for another, he was indifferent to sports and even more so to the hot dog that the Time Warner vice chairman shoved his way. But Turner was about to discover that Bewkes could hold his own, no matter what the setting.

While Bewkes meditated on the frankfurter, Turner strafed him with ideas about HBO, the pay network Bewkes headed at the time.

"He gave me four commands during the first three innings," Bewkes recalls. "He keeps giving me these things I disagree with (until) I go, 'Wait a minute! How many of these are good ideas?' He says, 'About one in five.' "

So how should Bewkes know which one to go with?

"That," Turner grinned, "is your job."

Today, 13 years after that conversation with Turner, Bewkes is chairman and CEO of Time Warner, and it is ultimately his decision to select the idea that will drive the company deep into the 21st century. In his mind, that idea is clear: Content is king.

"By evolving into a content company, we are in a position where we can take advantage of all the distribution platforms, both those that exist and those that may come about in the future," he says. "We believe there will always be a market for good stories, well told, and programming that captures the viewer's interest."

Ever since Bewkes, 57, was named to his post this year (he was promoted to chairman in January, a year after being named CEO in 2008), he has argued that Time Warner must shed everything that is ancillary to its main purpose: Delivering the content that the world wants to buy.

This has meant selling whole battalions of Time Warner's army, from the vast empire that was Time Warner Cable to Warner Music to Warner Books. Unlike so many of his peers, who seek to merge and accumulate in order to enhance their own power, Bewkes has made cuts and sought to focus on the one crucial vision.

It's ironic that, in positioning Time Warner for the future, Bewkes is digging deep into the traditions of the past.

"Time Warner has content creation in its DNA," says Thomas Tull, chairman and CEO of Legendary Pictures, based at Warner Bros. "Focusing on that is a good idea at the right time."

It is for this singularity of vision, this commitment to the one great idea than a scattershot collection of them, that The Hollywood Reporter has named Bewkes recipient of this year's Leadership Award.

Sitting in his cool, calm office, 11 stories above Central Park, Bewkes reflects on his mission.

"My responsibility is to lead the process of setting the direction, strategy and values of the company," he says. "I say 'lead the process' because it doesn't come out of tablets brought down from the mountain. It comes out of who we are, what are our values, what are our capabilities and therefore what should we do at Time Warner."

He sits back, lingering on that idea. He's an intriguing figure, a man of almost preternatural elegance and intelligence whose vast drive is concealed behind a Kennedy-esque reserve.

There is nothing Bewkes misses -- he knows exactly who is doing what, reads the people around him before they have even spoken. At the same time, he gives hardly anything away except for his passion for philosophy, foreign affairs and history, manifest in the collection of books that line his walls.

He speaks with ease about two other leaders, Thomas Jefferson and Alexander Hamilton. But his thoughts wander just as easily from America to France, where he spent two summers working as a young man, and he regales his interviewers with tales of how he was forced to eat horse meat just to survive -- until he started smelling like a horse himself.

A former colleague at HBO remembers how much Bewkes would talk about his wild youth at Yale, days when he saw himself as an anti-establishment rebel who did not easily find his mission until he gave up thoughts of being a journalist for business. Given his lack of interest in the excesses of corporate life, one suspects the bohemian youth still lurks somewhere inside him, which helps explain why so many creative giants describe him with real fondness.

Writer-producer David Chase recalls how one network after another spurned "The Sopranos." "Then I got to HBO and I said, 'Wow, this is a whole different order of business.' "

Chase began dealing with Bewkes once the pilot was shot. "He invited collaboration, but he didn't insist on collaboration," he recalls. "But he invited people to take risks. He's a leader you can have faith in, because you don't smell fear."

If Bewkes does in fact feel fear, he'll have to hold it at bay as Time Warner faces some of the greatest challenges in its existence.

In the midst of an economy that has battered ad support for magazines, cable networks and television shows, Bewkes must now prove that his commitment to content can provide consistent returns. He must decide whether to sell Time Warner's under-performing publications group and how to use the company's cash. Above all, he must corral Time Warner's 38,000 employees to execute his mandate.

Wall Street has responded to Bewkes' moves by finally raising Time Warner's stock price, which had been in the doldrums since the acquisition of AOL at the beginning of the decade. (AOL will be spun off by year's end.) But nobody can predict how much further the stock will go up.

"The big issue is the economy," says Michael Nathanson, senior media analyst at Bernstein Research in New York. "How will (Time Warner's broadcast networks) do in the ratings? Where will the studio (Warner Bros.) find its next batch of hits?"

These are the questions that preoccupy Bewkes. And they will ultimately define his reign.



Born in New Jersey, the son of a lawyer and corporate executive, Bewkes was raised mostly in Connecticut. It was a privileged life, as his father shuttled from a New York law firm to work as assistant to the Secretary of the Air Force, before joining an incipient conglomerate.

Early on, Bewkes was introduced to the world of entertainment through one of the companies his father helped acquire, David Susskind's Talent Associates, which produced "Get Smart." He spent the summer before his senior year at Yale in Los Angeles as a production assistant. "I was learning how the business worked," he recalls. "I was watching how they developed scripts each week, how the rehearsals went. I was taking in the business and I loved it."

Friends recall the charisma he projected at Yale, but he was unsure what he wanted to do with his life. A philosophy major, he dabbled with the notion of being the next Bob Woodward or Carl Bernstein and after graduation took his first job as a researcher for NBC News.

However, within months, Bewkes was laid off, which forced him to re-evaluate. He opted for business school at Stanford.

That might seem like a logical prospect now. But for some of his peers, it seemed like a sellout.

"A lot of my friends who were quasi-Marxist wouldn't talk to me about it," Bewkes acknowledges. "They were objectors to my doing it."

None of his friends doubted his abilities. At Stanford, says his former roommate, Peter Kreisky, "He really stood out from the rest of the class. He was very worldly, had very strong opinions about everything and was very well informed. Others argued with the professors and got thrown out of class. Jeff never did. His opinions were valued and intensely and intelligently argued."

In 1977 Bewkes landed a job with Capital Cities television in San Francisco, selling ads. But he loathed it. "Every meeting was preceded by a 10-minute sports discussion, like how did the Angels or Giants or somebody do last night," he explains. "I thought, there's no way I'm going into this line of work."

Instead, he opted for a job with Citibank in New York, where he remained for the next two years. But he didn't like servicing the clients.

And so in 1979 Bewkes took a gamble, abandoning the certainty of Citibank for HBO, a fledgling company that had only come into being seven years earlier.

Today, HBO is a pillar of American cultural and commercial life, so it is easy to forget just how tenuous the venture seemed then. The idea that viewers would pay to watch television, when everything on the broadcast networks was free, seemed as ludicrous as the idea of paying for Internet content does to many today.

But Bewkes was a believer. After starting in a division that created a second channel, Cinemax, over the next few years he would move from handling marketing to affiliate relations to strategic planning to finance. When his patron, Michael Fuchs, left in 1995 after opposing Time Warner's decision to acquire Turner Broadcasting, Bewkes was named CEO.

Bewkes' tenure at HBO has taken on a gilded air. Following his former boss Fuchs' lead, he made a concerted shift to lead the cabler away from its reliance on buying movies from the studios and toward original programming instead.

He remembers talking about this at that ball game with Turner.

"I said, 'Would you support it if I reversed course?' " he asked -- meaning, "What if we don't buy any of these movies? We go low on movies and we ramp up the originals?"

Turner was worried. He wondered if they might not be any good, and even Bewkes admitted, "The chances of it working are low."

He recognized that his goal was not each show's ratings but to provide content so compelling that subscribers would want to keep paying simply to be part of the water-cooler conversation.

What followed was a golden era for HBO. Its programming mix went from about 25% originals to more than 40%, and such resulting shows as "Sex and the City," "The Sopranos" and "Six Feet Under" helped differentiate the pay service from competitors.

Redefining HBO's mission was a challenge for Bewkes, personally as well as professionally. After all, the executive had built his career on the business side, and now he was overseeing creative -- a recipe for disaster for many others.

Why did Bewkes handle it so well?

"He recognized our unique position in the marketplace and understood when we developed 'It's not television, it's HBO,' that was not just a tag line: that was the underlying guiding principle of everything we do," recalls Eric Kessler, who headed marketing. "Jeff recognized that our programming, our marketing, the way we develop and use technology, needed to be different than everybody else's."



Not all are equally positive about Bewkes' role at the time. One or two former colleagues claim Bewkes too readily took credit for their creative endeavors. (Fuchs and Chris Albrecht, the longtime head of programming at HBO whom Bewkes dismissed after Albrecht was charged with physically abusing his girlfriend, declined comment.)

But by and large Bewkes' colleagues speak glowingly of his time there and also his manner -- almost always calm, controlled, rarely giving in to emotion, hardly ever being anything but discreet in his claims of success.

By 2008 his skill and composure had won over Richard Parsons, named chairman of Time Warner six years earlier in the wake of Gerald Levin's resignation. Parsons wanted to promote him; Bewkes, he says, resisted.

"Jeff was very happy at HBO," Parsons explains. "As he put it, he was the commander of his own little PT boat, running his own show, so he was not enthusiastic about coming to corporate."

But he did -- and just as Time Warner made its greatest mistake.

Levin's run at Time Warner had ended in disaster when he spearheaded the 2000 merger with AOL. Within months, the joint venture's stock had plummeted and Levin was universally lambasted.

Bewkes could have joined in with those attacks. But his graciousness in keeping his skepticism behind the scenes (he was a critic of the merger, who even took on AOL's Steve Case in a renowned boardroom attack), was noted and admired.

"I didn't argue disruptively; I wasn't being disloyal; I was never insubordinate," he says. "If you are going to tell your boss you don't agree, you have to do it respectfully, with integrity."

Bewkes also held onto his stock options at a time when he could have sold them, knowing he would lose millions by doing so. He was motivated, insiders say, by pure loyalty.

"We all knew this was a disaster," he says. "But we were not going to walk out and start selling stock, which is a clear sign of lack of support for our own company. It was going to cost us money, but that is what we were going to do."

Still, as the closing approached, Bewkes became more alarmed. "I'm sitting in meetings with the chiefs and saying, 'I don't think (we should do this),' " he notes. "I wasn't starting a revolution. I was telling them to their face, 'This does not make sense.' And they were telling me: 'Shut up.' "

Nobody is telling Bewkes to shut up today.

As Time Warner's leader, he sits atop a vast enterprise that includes such staples of our culture as CNN, HBO, TNT, TBS, Time, People and Warner Bros. The company's market cap is $32.6 billion, ahead of the $29.3 billion of News Corp. and only behind the $47.3 billion of Disney.

But Bewkes won't be satisfied sitting on his laurels. A man who for many years was wrongly perceived as a technocrat is embarking on a mission to transform one of the world's great media empires. And he is convinced how to do it.

"We're not short-term thinkers," he says. "We don't go for the knee-jerk reaction of, 'Oh! Our guys had a bad year so we're going to shoot them!' We go for the big play."

In doing so, he has relied on a handful of aides -- men like HBO chiefs Bill Nelson and Richard Plepler, Turner Broadcasting's Phil Kent, Time's Ann Moore and Warner Bros.' Barry Meyer and Alan Horn.

"Jeff has allowed us to take risks," Kent says. "He's quite brilliant in the way he assembles his thinking. He's very good at putting the pieces together."

Some pieces, Bewkes quickly decided, had to go. He looked at merging Warner Music with either EMI or BMG, but there were antitrust and other problems, so he sold the unit off instead.

The company also sold Warner Books because Bewkes felt it could not effectively compete without greater scale. He faced a more difficult decision to downsize New Line Cinema, even though he had longtime relationships with key executives Bob Shaye and Michael Lynne.

He will soon face a similar situation with Warner Bros. chairman Meyer and president Horn. In May, it was announced that Meyer and Horn had signed new contracts -- but for only two years. Were they being pushed out?

No, Bewkes insists. "They are at the top of their game. But they have been doing this for going on 12 years. They don't want to stay here forever. It's possible I could have gotten them to stay another year. More than that? No."

Consuming his attention are the spinoff this year of AOL, an ongoing stock-buyback program, ratings issues at the cable networks, possible acquisitions and an idea he has trumpeted, "TV Everywhere."

Bewkes first went public with the concept this year: To offer television content on all platforms -- for cell phones, computers and other new media. If users pay for cable or satellite services, they can access the shows in all their media.

"If you don't do TV Everywhere, you can't put all these networks online or on VOD because you will literally put your own distribution stream out of business," he says. "It has to work because it makes so much sense."

What makes most sense is this: That quality is everything and that Time Warner must reinvent itself to deliver the highest-quality content it can. This is Bewkes' mission, and one he has embraced with a vitality at striking odds with his calm, contained style.

It's quiet now as the workday ends. Outside his office, electrical storms have lit up the New York sky; bolts of lightning stories-high have shaken the men and women who are streaming through the city -- just as Bewkes has shaken up Time Warner. But this shake-up is precisely what Time Warner needs.

"He's re-energizing the place," Nelson says. "He's reimagining the business. When you look at what he is doing at Time Warner, it's a transformation."
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