THE KING OF CABLE : Since 1952, Bill Daniels Has Helped U.S. Get the Picture

One night in 1952, a young man who had just returned from flying fighter jets in Korea was driving through Denver on his way home to Casper, Wyo.

Hungry, he pulled over at a tavern on South Broadway.

“The name of the place was Murphy’s,” Bill Daniels recalled. “And I remember that I had a glass of beer and a corned beef sandwich.”

But what he remembers most vividly about that Denver stop was the television behind the bar. On the flickering, snowy screen were two boxers punching one another.

“I was shocked,” Daniels said. “I’d never seen a television set before. I boxed as a kid, and I couldn’t believe I was sitting there watching two guys box in New York or Chicago or someplace. I said to myself, ‘Now there is an invention.’ I immediately wanted to know how Denver could get television reception but not little places like Casper. Really, it all started that night in Murphy’s.”

To condense a long story, Daniels did bring television reception to Casper. And to Rawlins, Wyo., and Farmington, N.M., and a lot of other places.

Today, Bill Daniels is regarded by some as the father of the cable television industry. His company, Daniels & Associates, is one of the country’s biggest cable TV operations. It owns about 30 cable systems in 10 states. Last year, Daniels was a broker in 41 cable deals involving $518 million.

“When I got to Casper to join my brothers in the family insurance business, I couldn’t get TV out of my mind,” he said recently at his Carlsbad office.

“In those days, in Denver, all three networks were on one station, Channel 2. I found myself driving to Cheyenne and Denver on Wednesdays and Fridays to watch the Pabst Blue Ribbon Wednesday night fights and the Gillette Cavalcade of Sports boxing shows on Friday nights. I began to think there had to be a way to get TV to little towns like Casper.

“I discovered there were a lot of rich oil men in Casper who wanted to watch TV,” Daniels said. “They became my stockholders. I got together with a Denver TV engineer, Tom Morrisey, who showed me what had to be done.

“We leased a microwave service from the Denver phone company for $8,500 per month, and believe me, in 1952 that seemed like all the money in the world. I had to put up a $125,000 cash bond, because the phone company was sure I’d go broke.

“Once we got a cable hooked up into Casper, we leased space on phone company poles in the alleys of Casper and ran the cable right into the homes. Hookup cost was $150 and the monthly charge was $7.50. “It was a big hit. We couldn’t wire homes fast enough. Everyone wanted the service. The stockholders loved it.”

Daniels developed the nation’s first cable news show, by focusing a camera on an Associated Press wire ticker in Miles City, Mont., in the mid-1950s.

Today, he says his industry may be on the verge of a huge breakthrough in the area of televised sports. The National Football League, he says, may sign a cable TV agreement in 1987, after its present network TV contract expires.

“The NFL will eventually turn to cable TV--that will happen, I can tell you that,” he said. “It could happen as early as 1987. The cable industry could wind up with a Thursday or Sunday night game, something like that. It would give the NFL an opportunity to get acquainted with the cable industry.

“Eventually, I can guarantee you, the Super Bowl and practically all other major sports events in this country will be shown on pay-per-view TV exclusively. I don’t know if I’ll be alive to see it, but it’ll happen. It has to go that way, if athletes’ salaries stay where they are now. There’s no alternative--tickets are priced to the maximum. Will families be willing to pay $100 to $150 to go to a football game? I don’t think so.”

According to another source at Daniels & Associates, a group of the 35 largest cable operators in the country, including Daniels, is expected to make a bid for an NFL TV package in 1987, possibly for Monday or Sunday night games.

Daniels says football games televised by cable companies will be shorter than those shown on network television.

“Cable will restore integrity to football games,” he said.

“First of all, the telecasts must be produced better than the networks have done, because we’ll be dealing with viewers who are paying to watch the game.

“Second, there will be no television timeouts. We’ll sell advertising, but since there’ll be two sources of income--the viewers and advertising--there won’t be nearly the amount of commercials you see now. The networks have extended the length of the games by 30 minutes.”

An NFL contract will accelerate the growth of cable television, Daniels said.

“Of the 1.1 million households in Southern California with cable TV, about 50% to 60% are addressable (can receive pay-per-view telecasts),” Daniels said. “I think in five years, after NFL games are available on cable, that figure would go to 90%. It’s simply a matter of cable operators installing the equipment.

“With NFL games available on cable, the message to cable operators will be that if they don’t add on pay-per-view capability, they’re going to have a lot of unhappy subscribers.”

The numbers involved in cable TV and sports are enough to stun even Bill Daniels. He talked about the pay-per-view dollar implications to boxing.

“Take this Hagler-Leonard fight,” he said. “Maybe it’ll do $50 million with cable revenue. But at the present rate the country is getting wired, by the year 2000 a fight of that magnitude could make something like a quarter-of-a-billion, or about $175 million in today’s dollars.”

Daniels is already in the cable sports programming business. He and Laker owner Jerry Buss are equal partners in Prime Ticket, sort of a regional, mini-ESPN network offering sports programming to about a million cable households in Southern California.

“We’ve been in business one year and we should break even by April or May, August at the latest,” he said.

Prime Ticket, he said, could wind up bidding for cable TV rights to Raider or Ram games in 1987.

“That’s one of many options that could develop,” Daniels said. “If the NFL agrees to open local games to bidding from all TV operators, we’ll be in there bidding.”

Daniels said that he and Buss operate at different hours, but get along well anyway.

“Jerry and I get along just fine, but we’re not in sync,” Daniels said. “Jerry is a night guy, and gets up around noon. I’m in bed at 9 o’clock.”

They’re in sync with the right cable TV market, nearly all cable TV people agree.

Said Paul Kagan of Monterey, who publishes Cable TV Newsletter: “In 1969, when I started the newsletter, four million homes in the U.S. had cable. Now it’s about 40 million. In the next five to seven years, 20 million more will be added.

“Cable penetration in the the Los Angeles area is behind the national average for a variety of reasons, one of which is that there are so many entertainment options there. Los Angeles people go to the movies more than anyone else in the country, for example. And a good pay-per-view, over-the-air network was in place there for a number of years and that slowed cable growth.

“So it’s been a retarded market. But that’s in the process of changing. There is more potential growth there than in many other big markets. In time, it’ll be much bigger than any other market.”

Daniels said that based on his conversations with Art Modell, owner of the Cleveland Browns and the NFL’s television committee chairman, he believes that the NFL will seriously talk about a cable deal in 1987.

“The best way to describe the feelings of the NFL and the cable TV industry toward each other right now would be to say we’re both in heat,” Daniels said.

Conversation switched to pro football of another kind, the United States Football League. Daniels was the original owner of the Los Angeles Express, and wound up being one of the few USFL people to have made money.

“Going in, everything looked great to all of us (owners),” he said.

“We all agreed spring football could be sold to the American public if we were patient, and didn’t get into a salary contest with the NFL. We all agreed to develop our own, young players. We had a network TV contract going in, and no other new pro sports league had ever had that.

“Really, everything looked lovely.

“Walter Duncan, who owned the New Jersey Generals, was the first guy to get out. He sold to Donald Trump. But before he did that he signed Herschel Walker, and that scared me to death. It bothered me for quite a while, that the original agreement had been broken.

“But I forgot about it in the euphoria of our first game, in the Coliseum. We had a crowd of 35,000, it was a lovely day, and we beat the Generals and Herschel Walker.

“But down deep, after some other owners signed more expensive players, I was scared. I didn’t like the direction things were headed at all. I wanted to sell. And almost at that moment, Bill Oldenburg called me. I sold the team to him for $8 million, and he paid cash.”

That deal put Daniels in the black for his career in sports but he has had some losers.

He once owned an American Basketball Assn. team, the Utah Stars. In 1970-71, the team won the ABA championship and still lost $400,000. A deal to sell the team fell apart. In 1975, he had to declare the franchise bankrupt, and estimates today that it cost him about $5 million.

But this pro-sports-team-goes-belly-up story has a twist. This time, the only guy who got stiffed was the owner.

In 1980, Daniels returned to Salt Lake City, contacted 3,000 former Star season ticket-holders, and reimbursed them with interest. That cost him $750,000.

There were widespread snickers in Denver earlier this year when Daniels announced that he wanted to start a bank for kids. The Colorado Banking Commission didn’t snicker, it just said no, by a vote of 3-2.

“That’s still alive,” Daniels said. “We’re altering parts of our proposal the commission objected to. I still want to do it. When I went into a bank to borrow money for the first time at age 24, I felt like I was going on trial for murder. It’s no fun. I’ve been thrown out of more banks than anyone in the country.

“My idea is to have a banking operation that allows young people to learn how to comfortably deal with banks, and how to handle money responsibly.”

He explained it this way to Denver Business Magazine: “Let’s assume a 10-year-old kid goes to his dad and says he wants to borrow $50. My hope is that the father will say: ‘I’m not in the loan business. Go to the bank.’ If the child is under 18, the father will have to sign a note . . . but the child will get loan-payment notices and learn that he must pay back the loan by a certain date.”

Daniels once backed a race car that Lloyd Ruby drove in the Indianapolis 500. That experience cost him $200,000, but he says of it:

“Race car drivers are the greatest people in the world to deal with. Everything’s done on handshakes. They’re down-to-earth guys. No lawyers, no contracts, no agents.”

He also once took on a reclamation project, heavyweight boxer Ron Lyle. Daniels financed the ex-convict’s path to a 1975 heavyweight championship fight with Muhammad Ali. Lyle lost. So did Daniels, about $300,000.

Daniels has had a life-long interest in penal reform.

“Ron Lyle was in the Colorado State Penitentiary in Garden City when I first saw him box,” said Daniels, who won two New Mexico Golden Gloves championships as a student at the New Mexico Military Institute in Roswell.

“I’ve always been interested in ex-convicts and penal systems,” he said. “I helped Ron get a pardon and financed him while he trained for a title bout. I’ve always felt if cons had a job waiting for them when they got out of prison, we’d solve a lot of crime problems.”

Daniels, a pugnacious 65, smokes cigarettes, but the 5-foot 7-inch former amateur boxer still carries his fighting weight of 160 pounds. He’s four-times divorced, and has frequently said: “I’m the kind of guy who’d leave the house on Christmas Day to close a deal.”

He’s also the kind of guy who likes to share the wealth. He recently closed a multimillion-dollar deal by selling his share of an Anchorage, Alaska, cable system. He distributed about $8 million among 150 Denver employees, 100 in Carlsbad and 1,200 elsewhere around the United States. Secretary-level employees received four-digit checks.

Said Denver-based company spokesman Bob Russo: “My check was good for the down payment on my new house.”

Daniels: “I have no retirement or medical plans for my employees. I believe in getting the money to them while they’re young enough to enjoy it. Why wait until you’re 65, when you’re too tired? Since 1980, everyone around here, from secretaries to my vice presidents, has participated in the equity.

“And if there’s a loss on a deal, I take the lumps myself. People refer to my ‘generosity,’ giving my employees that money. It’s not that at all. People work their butts off for me, so they earn it. They work with me, not for me.”

Don’t bother calling Daniels’ office to see if he’s in. He’s in.

“I can’t wait to get to work in the morning, and when 5 o’clock comes around, I’m unhappy,” he said.

He said he never takes vacations, and spends his private time swimming, lying in the sun or reading. His current yet-to-read stack includes these titles: “His Way; The Unauthorized Biography of Frank Sinatra,” “Made in Japan: Akio Morita & The Sony Corporation,” “McDonald’s: Behind The Arches,” and “The Other Guy Blinked; How Pepsi Won The Cola Wars.”

“I stay in reasonably good shape by swimming about a half mile a day, either in the ocean or my pool,” he said. He has homes in Del Mar, Lake San Marcos, Denver and Palm Springs.”

His was a family scarred by the Depression.

“I was 9 when the market crashed in ‘29,” he said.

“My Dad was selling life insurance to farmers then, in Omaha. Farmers started paying their premiums in chickens and pigs. We lost our house, and moved to Council Bluffs, Iowa, where my grandmother had a home with no mortgage. My brother and I had to scrounge around in the woods in the winter, gathering firewood. We couldn’t afford coal. “I hauled groceries at the market and worked an 8 p.m.-2 a.m. shift cooking hamburgers at a diner, all through high school.”

In World War II, Daniels was a Navy fighter pilot who fought in the Pacific at Midway, the Coral Sea, the Marianas, Iwo Jima and the invasion of the Philippines.

“I entered Naval aviation in 1941 because my goal in those days was to make $187.50 a month. I had no idea there was going to be a war.”

After seeing action first in North Africa, Daniels was sent to the South Pacific. Then he was called back to duty for the Korean War. The next stop was Murphy’s, on South Broadway in Denver.