Liberty Media Eying Big and "Messy" Investment Deals, CEO Says

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Gregory Maffei

"We think there's better opportunities in the elephant-hunting realm," Gregory Maffei said on Tuesday.

Liberty Media CEO Gregory Maffei says he's looking for some big and "messy" investment deals.

Liberty, known for taking stakes in a variety of media companies, is on the hunt for "the extra large. We think there's better opportunities in the elephant-hunting realm," Maffei said Tuesday at the Morgan Stanley Technology, Media & Telecom Conference in San Francisco.

"Our strategy usually is to try and do things that are complex, because other people don't like complex — or messy, because other people don't like messy," he said. "It's very easy to do transactions. It's a lot harder to do ones that pay off."

He added that "the market is very frothy" for smaller deals, and he's happy to sit on cash until the right investment presents itself.

One of Liberty's successful investments of late was SiriusXM Radio, and Maffei expressed confidence in the future of that service because of the so-called "connected car" and because millions of automobiles on the road haven't yet subscribed to Sirius or XM satellite radio.

Still, though, he acknowledged the law of large numbers is taking a toll. When Liberty first invested in SiriusXM, the two services had a combined subscriber count of 18 million, whereas now it is 27 million. Churn is very low, suggesting consumers love the product, but conversion is also low, meaning it is tougher nowadays to get consumers to pay for their subscription once a free trial period runs its course.

The CEO also expressed skepticism over Time Warner's plan for an over-the-top, standalone HBO product, saying he doesn't see "massive demand" for such a service. He acknowledged, though, that there are cord-cutters and other consumers who are disenfranchised with a cable model that demands they pay big bucks for channels they never watch.

"There are people who don't want to get behind the bundle," he said.