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tv   The Communicators  CSPAN  August 24, 2015 8:00am-8:28am EDT

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>> you are watching booktv on c-span2 with top nonfiction books and authors every weekend. booktv, television for serious readers. >> up next "the communicators" with marc tayer, author of "televisionaries." c-span, created by america's cable companies 35 years ago brought to you as a public service by your local cable or satellite provider. >> is the 20th anniversary of the concept of digital tv and one of those who is in the trenches and develop it is marc tayer who is also the author of
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a new book called "televisionaries" and he is our guest for this edition of "the communicators." what happened 25 years ago and what was your role? >> guest: what happened 25 years ago was essentially the birth of digital television and will get more into exactly what that is because it's a little confusing. but i was whatever company called general instrument based in san diego and general instrument, or g.i. as it was known, was a technology conglomerate with headquarters in new york city. and one of the divisions was based here in san diego. and we were in the satellite and cable tv business. and that's what eventually led to the conception and invention of digital television. the background of that was our
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leaders at g.i. in san diego were pioneers in digital communications acknowledge. our business at the time was going very rapidly. we were encrypting the satellite tv signals of virtually all the u.s. content providers in the united states, such as hbo and cnn and espn and so on. and that was still in the age of analog tv. it's important to note that tv since its origins in between world war i and world war ii last century was really based on analog technology, meaning a continuous wave representing the tv signal. and being in the satellite tv business we had a real concern that was coming out of japan at the time. if you remember back in the
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'80s, the conventional wisdom was such that japan was rapidly becoming a top local economic power, and would surpass the u.s. of course, that never happened and it has shades of what equinox but today in terms of china. but at the time one of the components of that was that japan through nhk, state-owned broadcaster, had developed a high-definition technology and everyone thought i was going to take over the next generation of consumer electronics. in response, europe actually 13 countries of europe, that subsidize connectivity in europe to the tune of about $1 billion, essentially to keep japan out. and that was call hd map, another high-definition system. but there were two, there were fatal flaws in both the european
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and japanese effort. they were both based on analog high-definition technologies. and out of the blue here in san diego we announced the world's first digital high-definition television system, and it was really a technical shot heard around the world in terms of its impact on government and corporations, and to this day 25 years later, on media worldwide. >> host: what is a digital tv and how is it different from analog? >> guest: digital tv is really the intersection of computers with tv insurance of the core technologies. and it means that the entire chain of digital tv, production and distribution is converted into the zeros and ones of the computer world, such that zeros
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and ones are representing all the visual and sound information. of course, on the receive side when the consumer is viewing the picture it has to be converted back to analog so that the human visual system can perceive the signal. but that's really in simple terms what digital tv is, officers and once representing the tv signal from start to finish, as opposed to analog tv which is really a continuous wave picks of the best what is just think of the transformation from a continuous wave of analog to the zeros and ones of digital cosmic digital tv is not necessarily high-definition tv, is that correct? >> guest: that's correct. high-definition was the original emphasis for our invention but it took over a decade for the market to develop your high-definition television
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really meant a dramatic increase in resolution of the picture, the number of pixels in any given frame such that it was a much better picture to the consumer. in our case it was based on digital. by we anticipated early on that high-definition at the market would take many, many years to develop. that's actually in the original business plan that i wrote for general instrument. to get into this business. and in the meantime we realized early on, this was in 1989, 1990 that if we could do one digital hdtv signal in the channel, meaning to cable, satellite or terrestrial broadcast channel, that we could fit maybe up to 10 digital standard definition channels in the same channel. and so that really became the
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basis in the '90s and were able to generate billions of dollars of additional revenue from that business before hdtv even started to take off, roughly at the turn-of-the-century. so the customers for the digital standard definition were companies like hbo, espn, primestar and directdirect v, and a lot of services were only able to launch because of digital standard definition technology. >> host: how is it you ended up in san diego with g.i.? >> guest: well, very fortunate circumstance. i had grown up in northern california but then i was back east for roughly a dozen years, and when i got of wharton business school in philadelphia, i moved back to new york where i
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worked on wall street before business school. didn't really want to go back to the wall street world. i wanted to get into the technology world because i found it very exciting to be at the intersection of technology and business. and that's where general instrument was headquartered. so that was in the main 80s. i took a job in strategic planning and financial analysis in the g.i. corporate headquarters. at the time we had 17 different divisions of the company spread out all over the place, and the idea of this program was to hire people out of business school, give them an overview of the company and then have been them placed at an operating division two or three years later. and a lot of my peers had moved down to pennsylvania after corporate where our cable division headquarters was, but
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in september of 1986 we did an acquisition here in san diego, and i have actually helped analyze the acquisition from corporate headquarters and that was of the cable home equipment division. and all of a sudden it was a much more exciting company to work for. that business in san diego that we had acquired was a video division which assess it was encrypting all the satellite tv signals that were being delivered simultaneously to cable head ends into the big home dish owners of the time. remember that this was before the small dish came into being. so there were about 3 million large dish owners. at the time that was the only alternative to cable. the cable had about a 95% u.s. market share and the other 5% was a few million home dish
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owners. and so i started commuting out to san diego and then he offered me a transfer out. that's i got back to the west coast back in 1987. >> host: marc tayer, you to the story in "televisionaries" that is almost the happenstance that g.i. ended up being in san diego and get something do with irwin jacobs, the founder of qualcomm. >> guest: yesterday was very fortuitous. the origins of the story are a company called link of bits which irwin jacobs and andrew, the cofounders of qualcomm started a third guy named jerry heller who really was the father
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vision of digital tv was also with link a bit. they were spread out at first because as a part-time consulting endeavor. irwin jacobs was a professor at ucsc. andrew was a professor ucla and jacobs had been a ph.d thesis advisor at mit. they were both mit ph.d's. and abroad and jerry heller to be the first full-time engineer at length about it is that my house in l.a. but before he closed the next day irwin jacobs made a sudden decision that is going to leave usc s. as a professor and also join link a bit as a full-time employee. so instead of buying this house
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and l.a., they moved down to san diego and then later andrew moved down and the three of them made link a bit with one of the pioneering companies in digital communications. then what happened later was another big east coast tech company at the time of wired link a bit. at that juncture irwin jacobs and andrew left, while the left a little ways after and found qualcomm and general insurance required maycom and jerry heller stayed with g.i. here in san diego. eventually became my boss, and that's when the whole digital tv thing started. so if you think about san diego as a digital communications center, you had jacobs starting qualcomm and then jerry heller staying with g.i. essentially being the visionary behind digital television.
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>> host: marc tayer, we talk about the 25th anniversary of digital tv, but when did we become in use in the u.s.? >> guest: the initial customers in the early '90s. so the 25th anniversary is really back to when it was a secret project within g.i.'s labs here, and then i was told to be th that this is god to brg it out of the labs and turn it into a business. and then in june of 1990, almost exactly 25 years ago, cbs convinced us we should submit it to the fcc for consideration as the next generation of u.s. terrestrial broadcast standards. we were not quite sure what to do that because we were satellite cable guys and didn't have a whole lot to do with the terrestrial broadcast network business. but we've ended up doing that so all of a sudden in june of 1990 our cover was blown what we were
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doing. at first i don't said it was impossible what we were climbing. but sure enough a year or so later all of our competitors were essentially following us and he became a real race. as i mentioned, we anticipated correctly that high-definition was going to take many, many years for the market to develop. so we put most of our resources into a digital standard definition system, and in the second half of 1991, hbo, technical pioneer that they were and still are, agreed to field test our system. and then they launched it for the hbo of the plex digital standard definition and about november of 1991. also some international customers of ours in mexico and in canada and even in argentina jumped on the bandwagon very quickly in late 1991. but that was for satellite
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delivery to commercial for cable head ends. so it wasn't quite get digital all the way to the consumer. that first happened in 1994 with primestar who became our big customer. they launched digital standard definition to consumers in the spring of 1994, and then several months later directv launched to consumers also. so 1994 was really the first time that digital tv signals went all the way into consumers homes house of representatives mr. tayer, it was just a couple of years ago that analog signals were switched off. what was the role of the fcc in developing digital tv and then moving on to hdtv? >> guest: the sec had a central role in all of that. they coordinate a plan by which
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they broadcast stations would get an additional six megahertz channel such that they could transmit a digital signal, and that allowed a long-term transition. and then many years later they also coordinated the plan by which those terrestrial broadcast stations would give up their analog channel, turn off analog over the air forever, and the fcc was also involved in the standardization process of the digital terrestrial broadcast system which became called the grand alliance system. >> host: you talk in your book, in fact you open the book with the sentence that some of these video early contributors with the jd rockefeller's and andrew carnegie's of their day. >> guest: yes, and those media
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titans are still in charge of their media empires today. it's really a remarkable situation. the individuals i'm talking about our john malone and rupert murdoch and sumner redstone and a little younger and charlie ergen, and now brian roberts has come into his own as ceo of comcast. his father, ralph roberts, died at the age of 95 i believe just last week. so these are really the media pioneers and titans. and they understood something that was very important and i would say they understood it better than anyone else in particular john malone but also the others, which was that content and technology are really two sides of the same coin. they understood that digital technology. they comprehended that if they tap into that digital technology
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and used it to further their businesses they could expand their media businesses worldwide. that's exactly what they did, and they built these businesses into multibillion dollars media empires that are both still top of the food chain today as much as we talk about silicon valley and google and apple. and by the way, those companies are valued in the public stock market much more highly, but when it comes to the media business, they are still really neophytes. >> host: in fact when you talk about liberty media, john malone, you write, try to follow john malone's ever-changing composition of tracking stocks, spinoffs and acquisitions will make anyone's head spin. >> guest: that's very true your he's a brilliant guy. he was a ph.d in operations science i believe from johns
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hopkins, have gone to yale undergraduate, but really in addition to all that is a financial engineer, and he probably even makes the wall street financial engineers heads spin. tso assets and he's always so me steps ahead of the game in terms of what to do with those assets and how to continue building value. so today you have liberty global, which is the biggest cable operator by four upside the united states with about 24 million subscribers in about a dozen countries primarily in europe. you have liberty interactive as another public company which owns a lot of e-commerce assets. you now have liberty broadband which was spun off recently, and liberty broadband is the entity that owns 27% of charter, that a cable operator that is now trying to buy time warner cable
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after comcast bought out. and -- backed out. even other liberties -- entities of liberty. is constantly trying to figure how to move these assets around. >> host: what's been his role over the last 30 years or so, 40 years in developing the way we watch video today? >> guest: well, he started as a consultant, and one of his clients with general instrument. and then g.i., through its a general division in pennsylvania, the cable division, hired him to head up the business. this is back in the '70s, '80s i believe. and one of his biggest customers was tci, which was the biggest cable operator of it today based in denver. they then hired john malone to build a tci.
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they built tci into the biggest cable operator, and he was our biggest customer on the cable side. meaning general instrument. when he came to san diego and so are digital television demonstration, he immediately recognized a couple things. first, that our technology would enable competitors through cable to finally develop a so-called death star or these high-powered satellites that could power signals into very small pizza sized dishes, eventually became directv. but he also saw that they need to use this technology ostensibly to bring cable into the digital age. -- offensively. and he realized that immediately. there was a western cable show
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in anaheim, i think was in 1992, when he announced his vision of the 500 channel universe. of course, that was just a metaphor. what he really meant was that no longer would consumers be hostage to what the distributors were sending, that overtime digital technology was so flexible and so powerful that they would allow consumers to be masters of their own destiny. so the 500 channel universe was really a metaphor for that. and then in the late '90s, in 1998, he ended up selling tci to at&t for $48 billion. and comcast a few years later acquired that from at&t. they bought at&t and that's how the roberts family and comcast became the new king of cable. >> over the past 25 year period,
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mr. tayer, how regulated has been the development of digital tv? >> welcome in the areas i've been talking about it wasn't regulated at all. we did get at general instrument, we did get investigated twice by the justice department, and those are two very different situations. the first was they were concerned we had too much market power for our encryption technology, but they ruled it eventually that we were a legal monopoly, that does sound a little bit of an oxymoron and maybe it is but that's what the world. the second time we got caught in a little bit of a firefight between viacom and tci and primestar over control of our digital technology, and they thought we would have too much market control over digital technology. that ended up getting resolved as well. in terms of regulation at that
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stage, the main area the fcc was involved with had to do with program access rights, which allowed directv to get all the content they needed once they launch their satellites. there were some pricing regulations, and then they were very involved with standardizing the next generation, advanced television standard, which became the grand alliance digital hdtv system. but in terms of the market at large, our customer base of hbo and espn and tci and comcast, that was pretty much market driven. >> host: what is next? we've gone from black and white tv to color tv over the air to cable, as dick hud. once coming up, mr. tayer? >> guest: well, that's really
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interesting. but a lot of activities going on simultaneously, and you read all the time in the media, and this is one of the reasons i felt i had to write this book, that netflix and youtube are really digital. and they are, but they were really the fifth generation of digital. first big win over satellite, then over cable, then over terrestrial broadcast and then over dsl and fiber. and fifth ones of the internet which maybe is the most exciting of all, but it's certainly not where it started. and so this 25 year arc really traces that whole history. so what's next? hdtv is now very mainstream. one of the important technologies developed right now inaction going out into the mark is called ultra hd, or four k. those two terms are synonymous.
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is still very much early adopter phase of that and there's a lot of chicken and egg situation is being worked out, pretty much like how hdtv finally broke through about 15 years ago. so i would highlight ultra hd along with some related technology as the next generation of tv and video technology, but it is really not the only thing going on. >> host: and we are talking with marc tayer who's the author of this book, "televisionaries: inside the chaos and innovation of the digital revolution." spent part to with marc tayer about digital tv at how we watch video airs next saturday. you have been watching "the communicators" on c-span. >> c-span, created by america's cable companies 35 years ago abroad to the public service by
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your local cable or satellite providers. >> saturday august 29 marks the 10th anniversary of hurricane katrina would've applied deadliest storms in u.s. history. c-span specia special coverage s by today at 10 a.m. eastern atlantic magazines conference in new orleans and all that event featuring officials, offers and leaders. tuesday night at eight see spence 2062 or, at 9:30 p.m. at 2005 housing featuring new orleans citizens describe their experiences during and after the storm spent they told to take us the children would we get good help and get the seniors to help. they loaded us up on these military trucks, then they declared the city of new orleans,


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