(The following article first appeared in the February 2, 1994 issue of the now-defunct alternative newsweekly, Downtown, when CNN was still controlled by Ted Turner.)
CNN/TBS’s 1986 purchase of MGM/UA left Ted Turner’s media conglomerate with so much debt--$1.4 billion—that in 1987 Turner was forced to sell 37 percent of his inheritance-based CNN/TBS media operation to “a group of 26 cable operators and Time Inc.” and “if the $525 million deal hadn’t gone through, Turner would have been out of cash,” according to CNN: The Inside Story. As a result, “Turner went from owning more than 80 percent of TBS stock to maintaining from 51 to 65 percent" and “the new stockholders, led by Time Inc. and Denver-based Tele-Communications Inc., immediately appointed seven directors to join Turner’s eight board members” who “would have a lot of power over big decisions in the future,” according to the same book.
In its 1990 edition, Everybody’s Business pointed out that “Tele-Communications, the nation’s largest operator of cable TV systems (and therefore an important Turner customer) “ then owned “38 percent” of CNN/TBS’s Class C shares. “Time-Warner, [then] the second largest operator of cable-TV systems and a major program supplier (and therefore both a customer and Turner competitor)” then owned “32 percent of these C shares, and another cable TV operator, United Cable,” owned “8.9 percent of them,” during the early 1990s.
According to the International Directory of Company Histories, “the backing of the cable industry virtually guarantees the success” of CNN/TBS on a financial level. Contemporary American Business Leaders also revealed that “besides the money,” in 1987 CNN/TBS “got access to a built-in market of more than half the 43 million cable subscribing American homes because of its alliance with John Malone, then-president of Tele-Communications Incorporated, and one of the leaders of the investment group.” CNN: The Inside Story also emphasized that “the investment in Turner Broadcasting by cable operators, who had bailed out Turner…had meant the difference.”
Coincidentally, the cable industry which bailed Turner out when he became “financially overextended in the mid-1980s" and which owned a huge chunk of Turner’s CNN/TBS in 1994 “practically deified Turner" in the early 1990s, according to New York magazine (2/1/92), after CNN/TBS started to become a money-making machine. And, also coincidentally, Time Warner’s Time magazine named Turner as its 1991 “Man of the Year”—at the same time Time-Warner owned 21.9 percent of all types of CNN/TBS stock.
[Subsequently, in October, 1996, CNN finally became a subsidiary division of the Time Warner media conglomerate, after the Democratic Clinton Administration allowed Time Warner to acquire and merge its media monopoly operation with Ted Turner’s Turner CNN/TBS media monopoly operation--despite the existence of U.S. anti-trust laws that prohibit the monopolization of the U.S. media industry by media conglomerates like Time Warner/CNN. And the CNN “alternative” news network, CNN, is still today little more than a TV variant of the Time Warner media conglomerate’s Time magazine culturally and politically straight mind-set; and just another propaganda tool of the Militaristic U.S. Establishment in the 21st-century.]
Next: CNN/TBS’s Historic “Godfather” & Corporate Connections