The Agony of Victory


TIME: Spectator Column – January 17, 1994

The Agony of Victory

ONE OF THE REASONS why I don’t get excited about sports is the same reason why so many Americans get really excited about sports: each game or match ends unequivocally, always with a clear winner and loser. Almost nothing else is so simple and stark, and indeed as the consequential sectors of life become more and more untidy in this post-cold war, confused-sexual-etiquette age, obsessing over sports scores becomes for many people a tempting refuge. Fifty- nine to 36, 125 to 119, 5 to 2, 4 to 0; scores are all so obvious and pure — too damned obvious and pure for those of us inclined to suss out subtle meanings and unseen truths. Where are the paradoxes and ironies? Where is the rich, dialectical unfolding?

Which is why so many current business stories, especially those involving glamorous, huckstery businesses — that is, information superhighway businesses — are providing such extensive pleasure. In the just completed fight over the right to televise professional football games, and in the interminable fight for control of Paramount Communications, it doesn’t require much contrarianism to see the nominal winner in each instance as the ultimate loser.

Losing as a means of winning has some antecedents. When the Paris art establishment declined to let the Impressionists into their annual show in 1863, they got their own Salon des Refuses, and as a result the losers, including Manet, Whistler and Pisarro, are somewhat more familiar names today than such winners as Gleyre and Couture. Then there was, of course, the good luck of Germany and Japan to lose their war against the U.S., which enabled both to enjoy a half-century run of knock-’em-dead economic robustness under American military protection. (Foolishly, Vietnam won its war against the U.S., and two decades later is still suffering for that victory.)

In 1985, at the height of real estate a-go-go, the developer and publisher Mort Zuckerman was chosen after an intense competition to erect a gigantic high-rise — luxury condominiums! luxury offices! — on government land at the southwestern corner of Central Park; he was a winner. But a coalition of liberal Manhattan swells, worried about the shadow the skyscraper would cast over the park, ruinously slowed down Zuckerman’s plans; Mort was a loser. Then the commercial real estate market crashed, with Zuckerman, lucky for him, having built nothing; so he is a winner.

Lately, however, the trend has been for putative triumphs to reveal themselves as defeats rather than the other way around, and to do so quickly. Almost as soon as West Germany, for instance, achieved its fondest desire, unification with East Germany, its economy and politics started going haywire, and the peace and prosperity that had resulted from surrender was over. The Senate’s confirmation of Clarence Thomas to the Supreme Court was a putative win for the Bush Administration and the Republicans, but it was anti-Thomas backlash a year later that elected a squadron of Democratic women to the Senate and helped lose the election for Bush. In the fall of 1992, the four broadcast networks, especially CBS, were giddy at winning their long fight in Congress to oblige the cable-TV companies to negotiate payments for the network shows carried on cable; a year later, the networks, especially CBS, capitulated to terms essentially dictated by the cable companies.

CBS lost N.F.L. football last month, and the Fox network won it. What Fox won, though, was the right to spend $399.5 million a year on games for which CBS has been taking in around $200 million a year — which means Fox has agreed out front to squander tens and probably hundreds of millions of dollars during the next four years. The deal, Fox’s Rupert Murdoch blithely concedes, “will certainly be a loss.” But these days in the televi — that is, information superhighway — business, the iffy expenditure of billion-dollar sums is required in order to be considered visionary. “It’s a plan for the future,” says Lucie Salhany, Murdoch’s charmingly high-strung network president, of the football deal. “It takes the network to another level.” In other words, it’s a 21st century thing, and if you don’t get it, you’re a plodder and a bean counter.

It is Day 121 in the struggle between Sumner Redstone’s Viacom and Barry Diller’s QVC to acquire Paramount. The winner in this fight will almost certainly be a loser because the winner will overpay. Overpaying is a major symptom of show-business fever. Whatever the wishful rationalization of the day — magazines and cable TV need the synergy of movies and records (Time and Warner, 1989); hardware needs software (Sony and Matsushita buying Columbia Pictures and MCA/Universal, 1990-91); the information superhighway needs content (everyone, 1993-94) — it is almost axiomatic that when people come down with show-business fever, they pay a premium of 20% to 40%. QVC and Viacom are each offering nearly $10 billion for Paramount, which is about $3 billion more than the in-house analysis run by Capital Cities/ABC, for instance, reckoned the company is worth.

Close confidants of both Diller and Redstone say they have urged their respective principals in the past few weeks to back down and let the other tough guy win Paramount, plus the exciting obligation of assuming $4 billion to $8 billion in debt. But Redstone has the fever. Last Friday he threw more billions on the table and, to raise the cash, all but ceded control of his company, giving up half the seats on his board of directors to outsiders. He is plainly determined to win, even if it means losing.