Mark Cuban Owner, Dallas Mavericks (among other things) www.nba.com/mavericks
Cuban is an active investor in leading and cutting-edge technologies and owner of the Dallas Mavericks. Prior to his purchase of the Dallas Mavericks, Cuban co-founded Broadcast.com, the leading provider of multimedia and streaming on the Internet. Today, in addition to his ownership of theMavericks, Cuban is also Chairman of the high-definition television station HDNet which he launched in 2001. HDNet is the world’s first national television network broadcasting all of its programming in 1080i high-definition television (HDTV).
- MC: 1800Vote411, you all need to vote for me. I need your votes!
- WM: is there any guilt about blowing away Wayne Newton, he’s about 90!
- MC: yes, there is…he worked hard. everyone does. I’m doing the waltz….I practiced all day yesterday, I’ll fly back and do it later. I’ve lost 27 pounds
- WM: Why are you interested in buying the Chicago Cubs?
- MC: there are 100s of opportunities to deliver stuff in a digital universe, and sport and digital not yet joined. there are great opps
- WM: the red Sox, they have changed…these guys have won a World Champs
- MC: people fail to realise this. When I started with the Mavs we were last in revenue and now we are 3rd. We worked hard to generate the revenue. There’s a lot of loval stuff that can be done. There is a direct correlation about marketing and spending on talent
- WM: the NFL is basically socialism, but how do you become richer? you can’t spend more money etc on baseball as they have more revenue sharing, you can leverage that?
- MC: i do not know yet, I’ve not seen the details yet?
- WM: you were one of the early web pioneers, video, selling it for a bunch of money, tell us how you think and sustain a great idea.
- MC: it’s always simple. I look at myself as a consumer. I started Microsolutions, I was selling IBM PCs, this was new tech, I was not behind anyone; I looked at coming up with better ways,. My success was about doing my homework. In 1983, I got in touch with Novell, saying it would be good to get the PC connected. We were one of the first networking solutions companies. Dell and I used to go head to head all the time, the most brilliant things I saw Michael Dell do was he would put out an ad every week, the same products, the prices went down. we were trying to differentiate ourselves, make it better with broadcast.com, we used as our concept being able to listen to indiana basketball wherever you were. In 1995, we used sports to understand the technology, on how use the web for realtime communications. we started audio in ’96. we added video, so when big companies wanted to do business meetings, they would have theatres and they broadcast via satellite. We said we would do it over the net. in 1998, we could do it over the web.. Dell did it to talk to customers. Success was about making our customers more profitable and give them a competitive advantage and that is how we made the money
- WM: we talked with Jason Fried yesterday, about how when you have a product you have to figure out what the product is, what the design is, not build everything or build it for the sake of it, but build for the customers, make it simple, easy to use?
- MC: i agree. the challenge with new products is should it be a product or should it be a feature of another. They do not understand that if you create a product, the other product may add it as a feature.. Does this product create the path of least resistance for the customer to do what they want
- WM: is video a destination or a data type
- MC: it is a data type, it is popular for a few reasons- they subsidise your bandwidth. the web does not yet support it at quality or scale level yet. but bits are just bits
- WM: what about the soviet ministries. 10 years ago, you could design, manufacture and market, i the Palm Pilot. If it flopped, the you tried again, if a hit you raced to produce more and the next design.. there was this tremendous feedback loop. Today, so many things have to do with networks, you have to deal with the social ministries, the carriers, the cable tv etc. Now verizon decide the phones on their networks , the software, the apps and in most cases you need to pay them money to do things. It has made it harder for the feedback loop.
- MC: it’s a great question, but not sure if real. You had to make a choice – DOS, windows, apple. Today you have the choice of OS, Verizon may screw you but MS did the same. There was ethernet, arpnet, token ring. it’s not dramatically different. The companies are being victims of their own mistakes. There are enough networks.
- WM there are 4. 4 diff orifices as Jobs says
- MC: and Jobs is the king of the orifices. The greatest opp now is the developing a new OS. Vista sucks, mac is what it is, closed.
- WM: but you can develop apps….
- MC: you have great hardware manufactures that come up with all the dev in the PC. So if you have great PC hardware technology, then opportunities
- WM: Dell is shipping a Linux laptop, but most cannot use it. Is there an option for you to take a linux system and finish it. They are all 80% complete.
- MC: It’s the dancing, I do not have enough energy to focus on it. There should be, you need someone to knock apple and come up with a different thing. That’s where the opportunity is. I just wrote a post about switching, Never used a Mac product since 89, until Vista forced me. The Macbook just worked, it’s not that I can’t do a OS backup and restore, it’s I did not want to. Most things are now web driven, I do things in the browser.
- WM: Vista, they had their world dominating product. It took them 5 and 1/2 years, and people are not happy, . it requires you to buy a computer….
- MC: and most is on the net. You look at google, any platform . Yes it was a mistake. I used to call it the n-factorial issue, everything has to work with everything before, and one thing can upset the apple cart. Vista is being kept alive by corporations. They tried to make everything backward compatible and there is 20 years work and there is too much bullshit now.
- WM: Jobs is going to cut everyone off at the knees every 5 years.
- MC: he understands the revolution and new devices. Now you do not care about clock speed etc, Vista has more junk in it and it goes slower. I’m a huge MSFT fan across the board, outside of the PC,
- WM; has the PC peaked…When I wrote about that, the MS PR team got an editorial against that. Any mention of this, the PR team get on it
- MC: there was a day when you were excited.now people look for reasons not to replace,
- WM: it’s the cellphone?
- MC: it’s about content where you want and how you want. It’s cellphone, it’s other devices. It’s portable, people look for new cures for boredom on travel. In the house we not spending on pcs, but on consumer electronics, entertainment. The hardest is to connect TV and music and entertainment. Everyone wants to push HD over wireless, it is not going to work on what we have. It’s a race, home networks, HD networks are increasing faster then the bandwidth. I’m biased, but that’s why I got into it?
- WM: why do we need a HD network.
- MC: what differentiates us is that you can only receive HD on a HD tv set. People wanted to watch, there was no content and they looked for someone to fulfil, I looked at it, in 2001, 2002. The TV was expensive, everyone was saying too expensive and they would stay expensive.. I looked and saw Moores model – it would get cheaper. I saw that and said there was no content, people did not think it would grow. I looked at the distributors, it was built around bandwidth, they were supporting a number pf channels. Now I’m growing at 5% a month. I’m on the basic HD package. not on Comcast yet, so call them and ask
- WM: what kind of programming? I will watch HD programmes that I may not even like?
- MC: 70% of men tune to HD first, 40% will watch something in HD even if not liking it.
- MC: that’s what we had at the start. We have scifi, we have torchwood. we have news, sports, concerts. In the past concerts have not worked before well, on a big screen it works well, all day Sunday all we play is concents
- WM: how many?
- MC: we have 7 million subscribers. we pass by 65m homes. There’s not a lot of HD content. Networks upconvert and treat consumers as idiots. They make a deal of networks with HD but not talking about content. take out ESPN, us and discovery, there is little in HD. At some point that will be a competitive point
- WM: is that just physics?
- MC: no, they gave enough bandwidth. consumers will know the difference and that will become the competitive level that the number of channels is now.
- WM: you do not think the web can do HD?
- MC: not yet.
- WM: why in France can you get 100mb,, 40 bucks a month. on FIOS they get 15mb down, the only way to get that. why cannot we do better?
- MC: all these companies are public and they get yelled at for making that investment. The markets is about the big funds, wanting returns, and that will hurt us. A public company cannot compete, so companies may go private if they need to make investments.
- WM: so what are you not in? you have movies
- MC: landmark
- WM: I love my landmark
- MC: we had HDNet, we started to produce movies, we could make them, distribute on web, , to TV, but not theatre. Theatres are still a part of the experience. Movies need to be an improved experience. We are geared towards an older demo. We bought it so we could control the whole vertical chain. Because we control we can do things differently.
- WM: so you are Steve Jobs,
- MC: we want to create things digitally and get it to people where they want. We have DVD company, everything we distribute have no DRM and we are doing just fine. you can rip and copy but if I see you sell it I will beat the hell out of you.
- WM: the one I go to is great, but not all your stuff?
- MC: it’s for baby boomers, that is how I programme. it’s programmes for adults. We have 70 locations and 270 screens and we keep on opening more. We have movies and are going to be doing live events. Mon, tues.Wed are not good nights, so we are looking at programming in different ways. We are looking at 3D
- WM: about 3 weeks ago I get a call from Jeff Katzenberg, who I slightly know, he said that 3D is coming back in a good way you have to come and see us. he said it would be big and everywhere
- MC: there are going to be over 1000 theaters over the next 18 months. animation, horror, look at Beowolf. we are looking at games on ‘TV’ in 3d. you will see a whole different segment of OOH entertainment because bits are bits. For example, all Samsung HD Tvs are 3d enabled now.
- WM; are your theatres digital?
- MC: they are both. The digital business plan not there. we have it but it is more for special things, and live events
- WM: how do you motivate your people and your companies?
- MC: I’m not as good as I was as I used to be a lot more fun. the first company, we had a company shot, the kamikaze, we all went to the bar., I try and make it fun, they have their passions. Does not always work but we try and make it fiun
- WM: are Google unstoppable? their slogan is do no evil
- MC: yeah, right. You are always perfect until you are not. Some 12 year old is coming up with a better idea and it will change. Someone will come up with a better algorithm, a better way of searching, google is dependent on the PC being the primary device, I do not know if that is a long term bet.
- WM: but they are about to move to mobile?
- MC: who knows how that will work, whether it will catch on. the cellphone outside the home is super competitive. Google can take advantage, in a way few can, but I still think they are vulnerable to innovation
- WM: are you going to bid on the spectrum?
- MC: not going to bid, it is still a shared medium, it’s not a device connectivity issue it is bandwidth issue. We still cannot get the bandwidth to work in your homes. So how much will anyone ever get from the spectrum?. There will be all kinds of unique opportunities. The point when things change, is with 100mb throughput to home, that is when it will change
- WM: who can do it?
- MC: Verizon can do it.
- WM: they are the only ones doing it straight to the house. they did it too my home.
- MC: we depend on the device invented in 1900 to connect. At the same time we talk about development platforms and APIS. I talk to them, say give students conenction, give them 100MB, see what they will come up with. If there was one company I could buy, and I can’t afford it, it would be verizon. They have bought me and in and talked to me, lets see if they can do things. If you could hit 100MB today you could hit a GB to the home in the next 15 years
- WM: is it harder or easier to get funding and sustain a company?
- MC: it’s a lot easier today, not because it is easier to get funding, but the cost of tech is so small, and the cost of connectivity is so small, even if business is not tech. You do not need to make the same capital investment. Sweat equity, IP is a lot more valuable today than it was, as it is easier to implement than ever before. Some think about how much money instead of how much work they need to do. The best equity is the customers. They se the value and want to invest. If you need to raise capital, start small, get people to see the value and come to you.
- WM: since you get established and you get going, Irving Wladawsky-Berger said you near a near death to reinvent youself.
- MC: he’s right but I try and not wait that long. I say everyday that there is someone trying to beat me, and i have to work had to stop them kicking my ass.
- WM: you can never relax
- MC: that is the fun of it. it is continuing intellectual challenge and that is the fun
- WM: what is you next business?
- MC: hdNet trying to leverage digital media in new ways, everyone is so focused on wev when it comes to digital and they are looking the wrong direction. It’s TV, DVRs, connection in their homes, to movies, looking at ways to leverage it. There’s so many untapped markets, everyone is so web focused that we can do other stuff.
Tags: BIF, BIF3, Mark Cuban, Walt Mossberg