The $7.5 Billion Cable Throne
The Game of Thrones cost 7.5 billion dollars. That was the price at which Henry Samuel had extracted surrender from the Comcast board. It was five hundred million more than the 7 billion Yoo Jae-won had originally envisioned. The Comcast board, on the other hand, had demanded over 8 billion. Yoo Jae-won, whose pockets were deep, briefly considered simply paying whatever they asked. But with countless acquisitions still ahead, he knew that kind of spending would quickly become wasteful, so he trusted Henry Samuel and Alan to wait them out. He asked whether any poisonous clauses had slipped in, but there were none. At 7.5 billion, ID Group would acquire the stakes of every major shareholder on the board. That represented roughly 65 percent of the total shares; the remaining 35 percent floated on the open market in the hands of individuals and institutions. Yoo Jae-won would have preferred to buy those as well and take the company private, yet too many institutions and investors refused to sell. Sixty-five percent was still enough. With that stake he could do whatever he wished. Besides, Comcast was not a cash cow that paid dividends. In the twenty-first century things would change, but until then it remained a business that poured money into building high-speed internet infrastructure.
“Very well. I’ll instruct Secretary Choi to release the funds. Proceed with the acquisition immediately. I despise drawn-out negotiations—let’s exchange shares and payment in a single stroke.”
—As expected, you don’t waste time! Understood.
Henry Samuel would have given him a thumbs-up had he been standing there. Securing the cable company he had long coveted must have felt exhilarating. Once the acquisition closed, the company’s name would naturally change. Yoo Jae-won had already decided on it: Nextcomcast. The name made the relationship clear—Nextcom’s new subsidiary. Through the merger, Nextcom would gain the benefits of a Nasdaq backdoor listing. Future capital for high-speed internet infrastructure could be raised through the stock market, easing the burden on ID Group. Of course Yoo Jae-won had no intention of borrowing other people’s money for infrastructure, yet having more options was always wise. Investors wanted ID Technology or ID Investment to list instead, but those two pillars were central to his grand master plan; he intended to delay their IPOs as long as possible.
—Ah, one more thing. Comcast’s board said it would be an immense honor if you attended the signing ceremony.
The signing ceremony? A single phrase told Yoo Jae-won exactly what the Comcast executives were thinking. Henry Samuel could handle the contract signing and the handshake. Yet Yoo Jae-won’s recent successes had ignited public interest. If he appeared, the Comcast management team would once again stand in the media spotlight, making it easier for them to find new positions afterward.
—If you’re too busy, we can decline……
“No. I’ll attend.”
In his previous life he would have refused out of sheer annoyance. But after living through so many twists, after regressing, his perspective had shifted. When he had died before, he searched the entire internet and found no trace of himself; the loneliness of that realization still stung. Therefore, whenever a stage appeared that could make him shine, he now chose to stand on it. Such opportunities did not come often. The gains in recognition outweighed any minor inconvenience. A single photograph could be used again and again. The Comcast signing was the same. It existed only because he had spent 7.5 billion dollars. From a business standpoint the acquisition was sound, yet the sum itself was enormous. Larger deals would surely follow, but those belonged to an uncertain future. By acquiring the company others dismissed and building the internet infrastructure of tomorrow, future generations would judge the decision very differently.
—Understood! We’ll prepare the most splendid ceremony possible.
Henry Samuel and Yoo Jae-won worked well together. Few people inside ID Group could read Yoo Jae-won’s intentions so precisely and act at once.
A few days later the news broke.
—ID Group acquires Comcast, North America’s second-largest cable operator, in a surprise move!
—Deal valued at a staggering 7.5 billion dollars!
Bloomberg officially announced the acquisition. Rumors that had circulated as mere whispers were now confirmed fact. The stock market, which always moved three months ahead of the real economy, had already climbed sharply in anticipation. Because ID Group was not buying shares from ordinary investors, there had been no reason for a premium. Yet the market surged on the expectation that Comcast’s inept management would be replaced by ID Group’s youthful vision and internet expertise. In early 1992 the share price had lingered around 1.60 dollars. Mere rumors of a possible ID Group acquisition pushed it past 2 dollars. When Bloomberg confirmed the deal, it soared to 2.40 dollars. Investors clearly welcomed the acquisition. Credit-rating agencies such as Moody’s and S&P, however, were far more skeptical. They argued that a software company had no business owning an offline operator and questioned whether ID Group could manage the high maintenance costs of cable infrastructure, retransmission rights, customer service, and technical support. Had ID Group been publicly listed, the agencies would likely have downgraded its credit rating as well.
Yoo Jae-won paid no attention to the market chatter. Dressed comfortably, he attended the signing ceremony.
“Hello. I’m Yoo Jae-won.”
“Pleasure. Brian L. Roberts.”
Brian, Comcast’s CEO, looked every inch the meticulous executive. Whether by design or habit, he wore a black suit, white shirt, and black shoes; only his red tie—Comcast’s signature color—kept him from resembling a mourner. Yoo Jae-won, by contrast, looked exactly like an engineering student making an effort to appear presentable: beige trousers, a checkered shirt, and a navy blazer with faint vertical stripes. No tie. His casual appearance only made Brian seem stiffer.
“Shall we begin the final confirmation of the contract?”
After lengthy negotiations the document itself was simple. ID Group would purchase the board’s 65 percent stake for 7.5 billion dollars in a single transaction. Everything else was legal boilerplate. Brian was both CEO and owner of 30 percent of the shares. Twenty percent of the 65 percent Yoo Jae-won was buying came directly from Brian via block trade. Yoo Jae-won had wanted the remaining 10 percent as well, but Brian refused. The reason was straightforward: Brian was the founder’s son. He had inherited the company less than two years earlier and remained the most reluctant member of the board. Only after the other directors accepted the offer did he agree to sell. From the directors’ perspective, the price ID Group offered was simply too attractive. Brian’s stewardship had produced no visible improvement, retransmission fees for broadcast channels were about to become real expenses, and sports rights costs were skyrocketing. Subscriber numbers had been stuck at five million for months. Everyone on the board agreed that selling while ID Group was interested was the wiser choice. Brian still wore a faintly regretful expression, yet the deal was done and neither man spoke words that would sour the atmosphere. During the ceremony Brian praised Yoo Jae-won’s recent achievements; Yoo Jae-won, in turn, commended Brian for steering Comcast and promised to elevate the company’s name even higher. After the pleasantries, the signing took place. Cameras flashed relentlessly—when the contracts were exchanged, when hands were shaken. Yoo Jae-won had attended many events since founding ID Group, but never under such intense spotlight.
Afterward he held a brief press conference.
“Comcast will be renamed Nextcomcast.”
The announcement caused little stir; it had already been expected.
“The presidency of Nextcomcast will remain vacant for the time being. Major decisions will be handled temporarily by Henry Samuel, president of Nextcom.”
The personnel team was already searching for a suitable candidate. Since the vision came entirely from Yoo Jae-won, they needed someone who understood operations on the ground rather than another grand strategist. An internal promotion was highly likely.
“We are entering the digital age. Nextcomcast will invest more than three billion dollars to convert all existing analog cable equipment to digital, delivering noise-free, high-definition video and a far greater selection of channels. We will also provide the most affordable high-speed internet service in America, aligned with the information superhighway. This upgrade will create new jobs, so existing Comcast employees need not worry about losing their positions because of the merger.”
Laying fiber-optic cables and upgrading repeaters was work that had to be done eventually. It cost a great deal without immediately increasing revenue, so the previous management had moved at a glacial pace. Consumer complaints had reached a boiling point, but Yoo Jae-won had no intention of following that path. Infrastructure spending would be the same, yet high-speed internet would open entirely new revenue streams. The reporters looked startled at the mention of three billion dollars, yet Yoo Jae-won knew that by the twenty-first century the investment would return thirty billion—or perhaps far more.
The next day, before boarding his flight to Korea, Yoo Jae-won stopped by the Silicon Valley office to wrap up final matters. It was a weekday and he should have been at Stanford, but President Hennessy had already granted him an official fast-track pass; attendance was no longer an issue.
Several reports awaited him. Among the most important was the design for the next version of the Android operating system. A year had passed since Android 1.0 launched; it was time to prepare version 2.0. What mattered most to Yoo Jae-won was overhauling the file system. The current system still used the old DOS-era FAT structure, limiting file names to eight characters and extensions to three. More critically, access permissions could not be differentiated at the low level. Anyone who removed a hard drive and attached it to another machine could read every file. Password protection helped only if users bothered to set one—and most did not. Android 1.0’s security was therefore only half-complete. Version 2.0 would redesign the file system for the internet era and remove the eight-character limit, allowing spaces, special characters, and symbols.
—Understood. We’ll prioritize the Android file-system overhaul.
Kevin Johnson, president of the Android division, answered with a determined expression and tone over ID Talk. The connection was not merely text. A live video feed—320×200 resolution, high color—streamed in real time. What had once required expensive satellite phones and dedicated equipment was now available to anyone with an ISDN-class connection, ID Talk, and a Pentium PC. A video codec patch had been added to Android 1.0, and ID Talk had been updated accordingly. The principal reason for the update was video chat. As long as the connection remained stable, users enjoyed clear video and crisp audio, greatly expanding the scope of communication. For now the feature was used mainly in IT-savvy companies for business, but ordinary consumers had yet to adopt it widely; most households still lacked sufficient bandwidth.
“Next item?”
After finishing the Android 2.0 discussion, Yoo Jae-won moved on.
“News from the High Tech Research Institute. Some items from Russia, some from Redmond.”
Choi Kang-wook, seated to Yoo Jae-won’s right, handed over the next report. Nothing in it caused concern; events were unfolding exactly as Yoo Jae-won remembered. Leningrad had become St. Petersburg, Putin had been appointed deputy mayor, and Russia’s situation continued to deteriorate. The report concerned the Moscow branch of ID High Tech. As conditions worsened, the number of scientists knocking on the institute’s door had surged. Their specialties ranged from nuclear physics to satellites and aviation. Mikhail, who ran the Moscow facility, was forwarding vetted talent to the United States and now asked whether the influx should continue. There was also an inquiry from Dr. Shailov, who managed the Redmond branch. Originally staffed around nuclear physicists, the institute now attracted talent from every field. Cataloging their specialties was easy; assigning meaningful research projects was not. Every project required a budget, yet no one could estimate the necessary amounts.
“The headcount has increased dramatically. We’ll have to raise the budget accordingly.”
“Yes, but they’re unsure what research to pursue.”
Having come from the Soviet system, the researchers seemed reluctant to choose their own projects even when told they could. Under communism, one waited for the highest-ranking official to point a finger. Yoo Jae-won reviewed the list of researchers and their specialties, thought for a moment, then gave his answer.
“Continue the small modular reactor work and reinforce both personnel and equipment. Once the theory and design are complete, we’ll move to actual fabrication. Communication satellites are also worth pursuing. And drones—especially quadrotor designs. Various portable digital devices as well.”
Choi Kang-wook opened his notebook and recorded every word. He could have jotted down only the project names, yet he transcribed each phrase in full, determined not to miss a single detail.
“Also, has the photo-printer improvement been completed?”
When ID Group launched, it had acquired promising Silicon Valley startups as well as companies that possessed technology but failed at marketing. Firms with working prototypes became subsidiaries of ID Technology; those with only technology moved to High Tech. The photo-printing technology came from Tectonic, which had burned through its funding and collapsed. Its core developers transferred to the High Tech Research Institute and began refining the technology in the direction Yoo Jae-won desired.
“Yes! We’ve finally reached the level you requested.”
Yoo Jae-won did not want a revolutionary leap in image quality. He wanted acceptable quality at high speed—specifically, prints finished within ten seconds of the command. The reason was simple: he planned to combine the fast photo printer with a digital camera for a product at the 1993 Expo—the sticker photo booth. The device would become wildly popular in the mid-to-late nineties; he intended to bring it to market earlier. He was certain it would create an enormous sensation. ID Group itself would not sell sticker cameras; the technology would be leveraged into digital cameras, image processing, and office printers.
“Here are sample prints.”
Choi Kang-wook passed several photographs. One showed a Stanford electrical-engineering blackboard where a professor was proving the Poincaré conjecture, captured with a disposable camera. Compared with the original, some detail was lost, yet for a printer that finished in ten seconds the quality was perfectly adequate.
Yoo Jae-won spent the rest of the afternoon handling miscellaneous tasks, including preparations for a cluster server built from twelve thousand AMD CPUs. By evening he headed to the airport and boarded his flight to Korea without delay.
The next morning, Incheon International Airport was in an uproar—the star of the show, once again, was Yoo Jae-won. Every time he returned to Korea the airport became paralyzed; this visit was especially chaotic. He had solved one of mathematics’ seven great problems, closed the 7.5-billion-dollar Comcast deal, and now faced the grand welcoming ceremony prepared by Assemblyman Jeon Myeong-heon. After a whirlwind of interviews and photographs with the assemblyman, he finally escaped Gimpo Airport. Although Yoo Jae-won had grown accustomed to public appearances, standing with arms raised for photographs still felt painfully awkward. At least the media scrum at the airport meant the drive to Deokjin-ri was mercifully free of pursuit; an unspoken agreement had formed after previous paparazzi incidents. After a day of rest, Yoo Jae-won began his official schedule in earnest. Everyone had expected him to announce his support for Chairman Jeon Myeong-heon’s presidential bid. Instead, his first meeting was with Lee Yong-kwon, president of TG. He had originally planned to make the endorsement, but an urgent call from Lee Yong-kwon revealed a sudden and significant development in the behind-the-scenes negotiations between the Blue House and TG, forcing an immediate change of plans.