Deal to Buy MediaOne Crowns Comcast Chief’s Climb to the Top

Brian Roberts, the 39-year-old president of Comcast Corp., who orchestrated this week’s $47-billion takeover bid for MediaOne Group, was weaned on the cable frontier.

As a teenager, Roberts punched customers’ pay booklets, sold cable subscriptions door-to-door during the summers and tagged along with his father, Ralph, who founded Comcast in the early 1960s and built the industry alongside cable news maverick Ted Turner, Tele-Communications Inc.’s John Malone and Time Warner Inc. Chairman Gerald Levin.

While the image of Brian as Ralph’s kid has lingered long after his rise to president of Comcast in 1990, a series of bold initiatives is finally bringing Roberts the leadership recognition sources say he covets. He is moving into the spotlight as the cable industry confronts the most profound technological changes since Levin beamed Home Box Office into American homes via satellite in the early 1970s.

“Brian has pushed Comcast ahead of the industry in new technologies and is the right leader for cable’s new generation,” said Christopher Dixon, an analyst at PaineWebber Inc. “The young management team he has put together could position Comcast to assume the role passed along by John Malone.”

Malone, a role model whom Roberts reverently calls “one of the great American capitalists of the 20th century,” has set the industry’s agenda for the last decade as chief of TCI, which was sold to AT&T; this month for $44 billion.

A hint of Roberts’ ambitions surfaced in 1997, when together with partner Microsoft Corp., he initiated a secret bid for control of TCI by trying to buy a block of shares from heirs of its late founder, Robert Magness. The move angered Malone, who ultimately retained control but felt Roberts should have been more above-board in his approach.

For Roberts, the MediaOne transaction, if approved by shareholders and regulators, would catapult Comcast into the top cable tier, with AT&T; and Time Warner. The three would control about half the nation’s 70 million cable subscriptions.

Size is critical for cable companies eager to lower their costs and offer a bundle of telecommunications services as they go toe-to-toe with satellite television providers and phone companies in a digital revolution that promises improved TV pictures, more viewing choices, high-speed connections to the Internet and phone service, all from one provider.

The bid for MediaOne caps an acquisition spree over the last year that would more than double Comcast’s customer base and bring its market value to roughly $90 billion--above Walt Disney Co.’s and equal in size to Time Warner, the world’s largest entertainment conglomerate.

Comcast’s buying blitz was underwritten by a rally in cable stocks that traces to a dinner meeting between Roberts and Bill Gates two years ago. Their conversation led to a $1-billion investment by Microsoft in Comcast that affirmed cable as the preferred pathway into the home for information delivery.

The stock rally that followed made the younger Roberts something of an industry hero and set the stage for cable to become the favorite playground for Silicon Valley and AT&T.;

“You have to give Brian credit for the growth of the company,” said Marc Nathanson, chairman of Los Angeles cable company Falcon Communications. “They are sound operators and have an unusual corporate culture where the new guard is calling the shots but the old guard is still active as mentors. Brian is the exception of the second-generation in cable--competitive, but never cocky, arrogant, egotistical or pretentious, and always respectful. The stars have not gone to his head.”

Indeed, those who are close to Comcast credit the company’s rise to the collaborative culture that stems from a deeply respectful relationship between father and son.

“I’m on a lot of boards, but have never seen such a wonderfully talented and collegial management team,” said Anne Wexler, a Washington lobbyist who has been a Comcast director since 1990.

Brian was the only one of the five children of Ralph, now 79, and Suzanne Roberts, an actress in regional theater, to show an interest in the family business. Brian begged his father to hire him after graduating from the University of Pennsylvania and the Wharton School, where he was also a champion squash player.

“He was single-minded,” said Ralph, the company’s gregarious and courtly chairman who often takes 20 minutes to make his way to his office in the Philadelphia headquarters each morning as he greets even the security guards by name. “I said, ‘Gee Brian, you really should go out and work for someone else for a few years.’ Brian said, ‘I think you are rejecting me,’ and it turned me over. He started at the bottom, climbing poles and installing cable.”

Brian says his father’s light touch has allowed their relationship to flourish. “I haven’t had a bad idea in 20 years according to my father,” said Brian, who sources say nevertheless is driven by his father’s approval. “Lots of kids follow parents into the business but it doesn’t work out--the parents hold on too tight or don’t allow the young person to make the mistakes they need to.”

Steve Burke says the homey atmosphere factored into his decision to resign from Disney as head of the television station group last year to join Comcast as president of the cable group.

“Comcast feels like Capital Cities to me,” said Burke, whose father, Daniel, formed the legendary partnership with Thomas Murphy that built Capital Cities/ABC, the broadcasting giant now owned by Disney. “Both companies were built by decentralization, a strong point of view about right and wrong, minimal bureaucracy and a simplified decision-making process. Comcast still has no public relations department.”

Burke describes Brian as shy, energetic, intellectually curious and self-critical and credits Ralph with encouraging his son to recruit his own team to take the company to the next level.

“They have a top-quality team throughout the company, the best margins in the cable industry, the most consistent cash flow besides Time Warner, and double-digit growth,” said Merrill Lynch’s Jessica Reif Cohen.

Yet some industry executives question whether Comcast can manage its fast growth while integrating MediaOne, a top-heavy spinoff of regional phone company US West Communications Inc. More than half of MediaOne’s assets are in non-cable operations and many are international wireless properties that are now up for sale.

The pricey MediaOne transaction stands out as one of the most aggressive moves by the otherwise cost-conscious company. Sources in the cable industry say Roberts has lost out on several opportunities over the last two years because of his fear of striking a bad deal and a tendency to push too hard at the bargaining table.

The company was outmaneuvered in the bidding for the TV Food Network and the Travel Channel in a quest by Comcast to build its cable programming assets, which include the QVC shopping channel, the Golf Channel, a regional sports channel and E! Entertainment Television.

Comcast has mixed success with its Hollywood ventures. Roberts had a tumultuous brush in the mid-’90s with Barry Diller, who was hired by QVC’s owners to build the home shopping empire and tried to use it to take over CBS. Comcast quickly bought control of QVC to squelch the bid, which would have forced Comcast to divest QVC due to cable-broadcasting cross-ownership bans.

Roberts also backed an ill-fated programming partnership in C3, which was terminated last year because of diverging interests of the two Hollywood executives who were partners.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Brian Roberts

* Age: 39

* Education: University of Pennsylvania, Wharton School of Finance

* Family: Married, 3 children

* Interests: U.S. squash team that took silver medals at the 1981, 1985 and 1997 Maccabiah Games in Israel.

* Career: Started as a cable installer at Comcast in 1982; worked through the ranks for eight years as a regional and local cable manager of systems in Trenton, N.J., and Flint, Mich.; corporate executive vice president before becoming president, at age 30, in 1990.