Tele Munchen Group at 40

TMG's Herbert Kloiber

For Herbert Kloiber, overseeing Germany's biggest media empire is still a labor of love

"Hey, look at this!"

Herbert Kloiber, head of Tele Munchen Group and one of Europe's most powerful media moguls, tosses a magazine across his desk.

In front of him are piles of photographs -- Kloiber with Angelina Jolie, Kloiber with Rupert Murdoch, Kloiber with Silvio Berlusconi, even Kloiber with Lady Di. But the picture he's pointing at is from an Austrian glamour rag. It shows his friend, German television personality Thomas Gottschalk, dancing with some blond at the Vienna Opera Ball.

"We got him to host the Opera Ball for our Austrian channel ATV," Kloiber says, chuckling. "It really pissed off (competitor) ORF."

The picture and incident appeal to Kloiber on several levels. He's Austrian and a classical music buff. Legendary conductor Herbert von Karajan was his godfather. So making a splash at Vienna's premiere Opera House is a feather in his cap.

But another reason the picture makes Kloiber smile goes a long way to explain how that young man from rural Austria made it to the top of the German media industry. Whether it's competing with broadcasting giants RTL Group or ProSiebenSat.1 for rights to U.S. series and movies; doing tentpole deals to secure "Twilight" and "Shutter Island" for TMG's distribution arm Concorde or just winning the PR battle in the Austrian papers, Kloiber likes a good fight. And he likes to win.

"It's every morning, looking at the papers: How did we do?" He says. "Are we up, on top? Was 'Shutter Island' No. 1 and some other guy lost? Then I'm happy. If not, I do a lot of yelling and screaming."

In the German industry, Kloiber is known as a tough customer. "A real ball-breaker" is how one veteran producer describes him. TMG has operations in all segments from acquisition, production and distribution to exhibition and broadcasting. So Kloiber competes with pretty much everyone in the business.

But given his reputation and the myths that surround him, meeting Kloiber in person can be a disorienting experience. True, he has many of the attributes you'd associate with a mogul. His office in Munich has the requisite ego wall with pictures of him on his yacht, skiing the Alps, schmoozing with the rich and famous. A wall of another room is filled with his trophies -- including the Emmy Directorate Award for lifetime achievement the Academy of Television gave him in 2004.

But in person, Kloiber isn't the type-A egomaniac of lore. He's casual and chatty, almost self-effacing. His English (one of six languages he speaks) is softened by an American accent honed from years of negotiations with studio execs.

Kloiber came to the media world almost by accident. His father owned a water and heating firm. Kloiber, the son, was expected to take over the business. He studied law -- earning a doctorate title he still takes pride in -- but turned away from his dad to follow his godfather.

Herbert von Karajan was not only one of the best conductors of the 20th century, he also was the most successful, selling more than 200 million records worldwide. In 1970, Karajan was negotiating a deal with Leo Kirch's German rights group Beta Film. Having problems, he called in his godson, fresh out of law school, to help.

Kloiber ended up working for Kirch for six years. He negotiated music rights for Kirch's television empire and ran Unitel, a TV production outfit specializing in classical music recordings. But he fell out with Kirch and left Beta.

In 1977, Kloiber bought a little production company. He admits back then he had no idea that Tele Munchen, a boutique operation specializing in TV movies and classical music concerts, would one day become a vertically integrated media empire.

"In those days, due diligence hadn't been invented. I didn't even really know what I'd bought," Kloiber recalls. "There was no grand plan. The success has been a matter of seeing the opportunities and taking them when they came."

In the late '70s, Kirch's Beta Film had a stranglehold on the German rights business – 85% or more of the films on German TV came from Beta's library. Kloiber saw an opportunity.

"It was 1978 and I was in Cannes during MIP TV. On the third floor of the old Palais there was this French guy selling German rights to Louis de Funes films. A German guy had just left, without buying anything," Kloiber says. "I asked the French man, 'Who is that guy'? 'Beta,' he said -- the only other buyer in Germany. So I said, 'I'll buy your films.' I took the rights to 28 movies for German TV. I didn't know what I'd bought. I thought, 'Oh my God, what have I done?' "

At first, Kirch used his leverage to blackball Kloiber.

"When I went to (public broadcaster) ZDF, they laughed me out the door. I was the fool who dared to buy away from Kirch," he recalls.

But Kloiber kept at it, and sold the de Funes films. Then he bought some more, first from French companies Gaumount and UGC, later from U.S. studios -- and sold them to German channels.

Thirty years later and Kirch's empire is long gone, collapsed in bankruptcy. TMG has replaced it as Germany's largest rights dealer.

Kloiber has seen opportunities where others saw disaster. And he's held back when everyone else was leaping in.

"During the stock market boom years in the late '90s, we'd have bankers coming in every day saying, 'Go public! You'll be worth a billion!' " says Bernd Schloetterer, managing director and shareholder at TMG. "But Dr. Kloiber said no."

Tele Munchen employees regard "Herr Doctor Kloiber" with an admiration bordering on awe. There's talk of his "gut instinct" when making deals, his "sixth sense" in spotting industry trends ahead of the curve.

The truth is more prosaic: Kloiber sweats the small stuff. He might have Murdoch and Berlusconi on speed dial, but this mogul is still intimately involved in every aspect of his media empire, from what new hot scripts are making the rounds in L.A. to the state of the dozens of movie houses across Germany under his company's control.

"The other day I was talking to my son and he told me he'd been at a CinemaxX theater and there was popcorn all over the floor," Kloiber recalls. "So I call up (CinemaxX CEO) Christian Gisy and I start complaining: Why aren't people cleaning up, what's going on? In the meantime, he's telling me about the quarterly figures, but I'm still bitching about the popcorn."

Kloiber speaks to his top executives twice or more a day. His calls are never long -- "my telephone conferences last 12 minutes maximum," he says -- but you can set your watch by them.

This need to be in constant contact, the interest in the minutiae of his company's operations, suggests Kloiber, like many a mogul before him, will have a hard time letting go. Few at Tele Munchen believe the Herr Doctor when he says he will retire after his 65th birthday, three years from now.

"I could give it all up, no problem. I could walk out of here tomorrow," he insists. But one gets the sense that while Herbert Kloiber might not miss the glamour, the galas and the prestige of being Germany's premiere media mogul, he would miss the fights.