Speaker 1: Welcome to Tech Stuff, a production from I Heart Radio.
Speaker 1: Hey there, and welcome to tech Stuff. I'm your host,
Speaker 1: Jonathan strick Lind. I'm an executive producer with I Heart
Speaker 1: Radio and I love all things tech. And recently I
Speaker 1: covered in a tech News episode that A T and
Speaker 1: T is looking to jettison Warner Media and have it
Speaker 1: merged with Discovery Communications. And in that episode, I talked
Speaker 1: about how the Warner Media group of companies has a
Speaker 1: pretty complicated lineage. Well, today I thought we'd start down
Speaker 1: the road to talk about the various companies that make
Speaker 1: up Warner Media kind of unravel at all. And this
Speaker 1: is gonna be a heck of a story because it
Speaker 1: includes several influential media companies that had their own distinct
Speaker 1: histories before coalescing into Warner Media. But it also includes
Speaker 1: companies that are not media companies at all, like funeral
Speaker 1: homes for real. Now, when I say complicated, I'm not kidding.
Speaker 1: Our story includes a window washing company, parking company, and
Speaker 1: online service provider company, UM, few magazine publishers and more.
Speaker 1: There are mergers, there are acquisitions, there are spinoffs, there's
Speaker 1: family betrayal, and lots of other stuff. So where the
Speaker 1: heck do I get started? Well, I suppose I should
Speaker 1: talk about the core components and then work to the
Speaker 1: point where they all come together. And I could start
Speaker 1: pretty much anywhere, because there's so many different pieces to
Speaker 1: the story, But I'm going to begin with Time because
Speaker 1: it's on my side, Yes it is. Henry Loose and
Speaker 1: Britton Haddn't had a lot in common. They both attended
Speaker 1: Yale University, they both worked as reporters for the Baltimore News,
Speaker 1: and both of them were in their early twenties back
Speaker 1: in nineteen twenty two, and they also both wanted to
Speaker 1: try something that was a new idea. Newspapers were a thing, obviously,
Speaker 1: but Luce and Haddn't had the idea for a news magazine.
Speaker 1: They decided to try and create one because no one
Speaker 1: had really done it before, and they raised more than
Speaker 1: eighty thousand dollars, which was a princely sum in nineteen
Speaker 1: twenty two, and they quit their jobs to found a
Speaker 1: company called Time Incorporated and a magazine called Time. It
Speaker 1: would publish weekly starting in March of nineteen twenty three.
Speaker 1: Luce served as the business manager for the young publishing
Speaker 1: company and Hadden was editor in chief, and together they
Speaker 1: found success with this weekly magazine format. Seven years later,
Speaker 1: haddn't passed away suddenly after an illness had developed into sepsis.
Speaker 1: Loose pressed on becoming editor in chief and launching other
Speaker 1: magazines like Fortune, which launched just as the Great Depression
Speaker 1: was settling in. So that's kind of ironic timing. He
Speaker 1: also published Life, which I think already existed as a
Speaker 1: as a different kind of publication, but he essentially acquired
Speaker 1: it and then relaunched it under a new format, effectively
Speaker 1: making a new magazine, and then much much later magazines
Speaker 1: like Sports Illustrated. He also, according to some accounts, essentially
Speaker 1: erased Hadden's contributions to the company time Inc. Was becoming
Speaker 1: a giant publisher. Moreover, Loose oversaw the launch of other
Speaker 1: forms of media content. In nineteen thirty one, the company
Speaker 1: sponsored a radio news series that aired on CBS Radio,
Speaker 1: and in nineteen thirty five the company expanded this to newsreels,
Speaker 1: which were these things that we play in movie theaters
Speaker 1: between pictures. So instead of you know, just watching a movie,
Speaker 1: you might actually see a ten or fifteen that segment
Speaker 1: about the latest news or kind of a documentary or
Speaker 1: a highlight of something. The newsreels were slightly different from
Speaker 1: others at the time. They had a longer format and
Speaker 1: the inclusion of stuff like re enactments. The concept was
Speaker 1: to make a newsreel that was the cinematic sibling of
Speaker 1: Time magazine or Life Magazine, something that was akin to those.
Speaker 1: The March of Time series would end up receiving several awards,
Speaker 1: including an Honorary Academy Award. This made Time Incorporated a
Speaker 1: multimedia company, publishing and newsreels and radio. It was one
Speaker 1: of the earliest examples of such a thing. Luce was
Speaker 1: editor in chief until nineteen sixty four, and he passed
Speaker 1: away just three years after that. But the publisher, the
Speaker 1: company that is continued to grow over the years, and
Speaker 1: by the late nineteen eighties it was poised to play
Speaker 1: a bigger part in our story. But now we're going
Speaker 1: to switch over to another company. Because really, when you
Speaker 1: get to it, Times story is really one of publishing
Speaker 1: and growing a company over time. Uh. It doesn't have
Speaker 1: a whole lot to do with with tech, apart from
Speaker 1: the fact that obviously technological advancements can mean smoothing out
Speaker 1: the processes of a company's operations like from printing to distribution.
Speaker 1: But I don't really think that that's worthy of us
Speaker 1: really diving into here. So we're gonna switch over to
Speaker 1: Warner Brothers Entertainment Incorporated, or the old w B. Now,
Speaker 1: the Warner family immigrated to the United States from Poland
Speaker 1: in the early eighties, and in fact, three of the
Speaker 1: four Warner brothers referenced in the name of the company
Speaker 1: We're born in Poland, those being Harry, who was the eldest,
Speaker 1: and then Albert and Sam. Now some sources ice I've
Speaker 1: seen suggest that Albert and Sam were born in North America.
Speaker 1: But a to a guy who was hired by Warner
Speaker 1: Brothers to come in and do research on this kind
Speaker 1: of stuff, that wasn't the case. Jack, the youngest of
Speaker 1: the four Warner brothers, was born in North America. He
Speaker 1: was born in Canada. And they also had other siblings
Speaker 1: as well. This was a big family. I think there
Speaker 1: were nine of them total, so that wasn't all of them,
Speaker 1: but those were the four brothers of the Warner Brothers fame. Now,
Speaker 1: this family wasn't exactly impoverished, but it was a lot
Speaker 1: of work to make ends meet. So the brothers worked
Speaker 1: in all sorts of lines of work in the Midwest.
Speaker 1: They worked in the meat industry, they worked at bowling alleys,
Speaker 1: They did all sorts of stuff, and they were all
Speaker 1: looking for ways to be a success, and gradually they
Speaker 1: built up a little money. In nineteen o three, the
Speaker 1: four brothers rented a vacant store in Newcastle, Pennsylvania, and
Speaker 1: they wanted to turn it into a film exchange in
Speaker 1: a movie theater that they had also acquired a film
Speaker 1: projector now obvious sleeve. This was in the extremely early
Speaker 1: days of cinema. The brothers mainly focused on getting hold
Speaker 1: of films and making them available to other theaters in
Speaker 1: the region, thus the film exchange business. They were kind
Speaker 1: of a go between between the movie studios and the
Speaker 1: movie theaters. And it turned out that motion pictures weren't
Speaker 1: just a fad. Also turned out that it was a
Speaker 1: really shady business. There were a lot of um criminal
Speaker 1: types who got interested in stuff like film exchanges. I
Speaker 1: have no idea how involved the Warners were, if at all,
Speaker 1: in that side of life, but it was definitely a
Speaker 1: thing that was going on. Not turned out that since
Speaker 1: motion pictures were so popular, you know, I feel pretty
Speaker 1: confident saying motion pictures were a success, you know, from
Speaker 1: the perspective of one the brothers business was also successful,
Speaker 1: and they began to, you know, use the money that
Speaker 1: they made to open more theaters and expand by n
Speaker 1: they decided that they would branch out from the business
Speaker 1: of exhibiting films and get into the business of making them,
Speaker 1: because one of the downsides of this is that you
Speaker 1: couldn't guarantee the quality of the movies that were being
Speaker 1: sent to you, and a lot of the movies were
Speaker 1: on the not so great side, like either they were
Speaker 1: just poorly made or they frequently involved material that was
Speaker 1: considered risk a or worse. So movies had a really
Speaker 1: bad reputation in the early days, and the brothers kind
Speaker 1: of wanted to have more control over the whole process,
Speaker 1: so they decided to create their own movie studio. Jack
Speaker 1: Warner would be in charge of movie production. He oversaw
Speaker 1: the film operations side of things. Harry handled all the
Speaker 1: business operations for the company. He was effectively the head
Speaker 1: of Warner Brothers, and Sam was in charge of securing
Speaker 1: and maintaining technical equipment, and Alb would work with other
Speaker 1: theaters to handle distribution of the Warner Films. The four
Speaker 1: opened up Warner Brothers Studio in Hollywood, California, in nineteen eighteen,
Speaker 1: originally on Sunset Boulevard, which at the time was considered
Speaker 1: a seedy part of of Hollywood. Um, I don't know
Speaker 1: if it still is. I actually kind of like Sunset Boulevard,
Speaker 1: but maybe it's because I'm a seedy guy. Anyway. They
Speaker 1: incorporated as Warner Brothers Pictures in nineteen twenty three. By
Speaker 1: that time, they had already produced several films, and the
Speaker 1: first really big success for them was a series of pictures,
Speaker 1: that is, movies that started a four legged actor that
Speaker 1: being rentin Tin. Uh. That's a dog for those of
Speaker 1: you who have never seen a rentin Tin picture. And
Speaker 1: the dog was learning like a thousand bucks a week,
Speaker 1: which was, you know, quite the princely pooch. I would
Speaker 1: imagine that's a lot of money back in those days,
Speaker 1: not a not a small shake of these days. Warner
Speaker 1: Brothers was an independent studio back then and was facing
Speaker 1: off against three much more established companies. There was Paramount,
Speaker 1: there was MGM, and there was a company called First National.
Speaker 1: Warner Brothers was scrappy compared to those three and Sam
Speaker 1: had a vision for what could help set the studio
Speaker 1: apart and change the industry forever. See this was again
Speaker 1: the era of the silent film. Movies would play in
Speaker 1: movie houses and typically you would have like a house
Speaker 1: musician who would play along with the film on on
Speaker 1: an oregon or something, and all dialogue would be represented
Speaker 1: in little interstitial cards that would pop up, which created
Speaker 1: a certain interesting style of cinema, like you could make
Speaker 1: really compelling movies this way, but it also clearly limited
Speaker 1: the actors range. Sam wanted to synchronize sound with the
Speaker 1: images on screen, and he wanted the company to pioneer
Speaker 1: the technologies and the installations that would allow for talking pictures.
Speaker 1: He initially met with some resistance from Harry, who was like,
Speaker 1: why the heck do we need to hear the actors talk?
Speaker 1: But the studio hit a bit of a rough patch,
Speaker 1: and maybe in desperation, Harry ended up giving Sam the
Speaker 1: green light. Warner Brothers then purchased a company that had
Speaker 1: spun off from Western Electric. This company was called the
Speaker 1: Vitograph Company. The Vitogram system was a film sound recording system,
Speaker 1: but it wasn't recording sound to film the way we
Speaker 1: do it today. Instead, this system used sixteen inch discs
Speaker 1: like records, they had a groove recorded in them, representing
Speaker 1: a soundtrack. So this is like a vinyl album, and
Speaker 1: it included everything like music and sound effects and eventually
Speaker 1: dialogue and vocals, though originally Harry did not want that included.
Speaker 1: He just wanted, you know, music and sound effects on there. Uh.
Speaker 1: A side of a desk would run for about eleven
Speaker 1: minutes when played back at an RPM of thirty three
Speaker 1: and a third. Eleven minutes was about the same amount
Speaker 1: of time it took to project through a thousand feet
Speaker 1: of film. And you know, in those early days you
Speaker 1: would end up just having about a thousand feet per
Speaker 1: real of film, and so one side of the record
Speaker 1: would typically have a groove on it, the other side
Speaker 1: would be blank, and each record would go with a
Speaker 1: single reel of film, and you were just supposed to
Speaker 1: keep them two of them together. So with a setup,
Speaker 1: you would have a projectionist who would use a special
Speaker 1: piece of equipment that was part projector part record turntable,
Speaker 1: and they would feed the film into the projector they
Speaker 1: would set the little needle or stylus of the record
Speaker 1: player on the beginning of the recording, which from what
Speaker 1: I understand, was actually at the center of the disk.
Speaker 1: And you know most records, you know, you put the
Speaker 1: needle on the outside of the record and it follows
Speaker 1: the groove gradually all the way to the inside. Apparently,
Speaker 1: with the vitaphone system, you would put the needle at
Speaker 1: the center of it, and because the way that the
Speaker 1: record turned and the way the groove was laid out,
Speaker 1: it would actually go outward to the outer edge starting
Speaker 1: the projector would mean that the film and soundtrack playback
Speaker 1: would be synchronized at least, you know, theoretically. The first
Speaker 1: Warner Brothers film using a vitophone soundtrack was Don Juan,
Speaker 1: but the piece had already been filmed. The soundtrack included
Speaker 1: the score for the movie and some sound effects, but
Speaker 1: no dialogue, so Don Juan was still largely a silent film.
Speaker 1: The first talkie was The Jazz Singer, a film with
Speaker 1: a recorded sound all the way through, so there was
Speaker 1: dialogue and singing within the film itself. Now I'm going
Speaker 1: to leave it to film historians to talk about the movie,
Speaker 1: which has elements in it that I think are, you know,
Speaker 1: to put it charitably, challenging, but from a technical perspective,
Speaker 1: it was marking a new era, and this was also
Speaker 1: an era that would go without it's early champion. Sam Warner,
Speaker 1: who had pushed so hard to incorporate sound into movies,
Speaker 1: died the night before the premiere of The Jazz Singer.
Speaker 1: The narrative goes that he worked himself to death, though
Speaker 1: author David Thompson suggests that perhaps there were some other
Speaker 1: underlying health conditions that contributed to his early demise. But
Speaker 1: now the Warner Brothers were three. Now Warner Brothers, the
Speaker 1: company would stick with vitaphone for a few years, but
Speaker 1: even when The Jazz Singer came out, the writing was
Speaker 1: already on the wall. The future of sound on film
Speaker 1: wasn't with separate recorded discs, but a methodology that would
Speaker 1: allow filmmakers to actually record sound directly onto film itself.
Speaker 1: I've covered how this works in previous episodes of Tech Stuff,
Speaker 1: so I'm not going to go into it here. But
Speaker 1: what it really meant for Warner Brothers was that the
Speaker 1: company would eventually have to come around to adopting the
Speaker 1: industry standard and abandoning the vitaphone of coach. The Jazz
Speaker 1: Singer was a huge hit for Warner Brothers, and the
Speaker 1: company was able to afford new digs, so they relocated
Speaker 1: off of Sunset Boulevard and they purchased land to build
Speaker 1: a studio in Burbank, California, setting out a whole new
Speaker 1: studio there, and the company also acquired the Stanley Company
Speaker 1: of America, a business that owned more than two hundred
Speaker 1: movie theaters across the United States. This gave the Warner
Speaker 1: Brothers a distribution channel for the company's movies, and it
Speaker 1: would also be one of the big elements that would
Speaker 1: prompt the US government to take a closer look at
Speaker 1: the film industry. So to be clear, I should really
Speaker 1: point out this was something that every major movie studio
Speaker 1: was doing. It was pretty much common practice for companies
Speaker 1: like MGM and Paramount to have their own movie houses
Speaker 1: across the US, and it created a pretty rough environment
Speaker 1: for independent theater owners. In the nineteen thirties, Warner Brothers
Speaker 1: began to produce cartoons for movie theaters, and that's when
Speaker 1: we got the Loon It Tunes, characters like Bugs, Bunny,
Speaker 1: you know, they rabbit in space, Jam, Filthy Young People.
Speaker 1: It's also when Warner Brothers turned to producing a lot
Speaker 1: of gangster movies, like a lot of them. These were
Speaker 1: the studio days when companies would sign directors and stars
Speaker 1: to long term contracts which made them exclusive talent for
Speaker 1: that studio. Same was true for film cruise too, so
Speaker 1: people would go in day after day working with the
Speaker 1: same group of folks. Sometimes from one picture to the other.
Speaker 1: You might not even really be able to tell what
Speaker 1: movie you're working on, just because you're always around the
Speaker 1: same people in the same studios. James Cagney became the
Speaker 1: top star for the company, and Humphrey Bogart, who was
Speaker 1: on the company payroll, was held back because Harry Warner
Speaker 1: wasn't convinced that Bogart was star material. Talk about a
Speaker 1: a wrong take anyway. Warner Brothers also acquired another company
Speaker 1: called Cosmopolitan Films, which was formerly owned by the newspaper
Speaker 1: giant William Randolph Hurst, who perhaps has the tackiest home
Speaker 1: I've ever seen. The Hearst Castle is just a monument
Speaker 1: to gaudiness. Anyway, the company kept on growing. In nine four,
Speaker 1: most movie studios, including Warner Brothers, signed onto the Motion
Speaker 1: Picture Production Code also known as the Haze Code, after
Speaker 1: the then president of the Motion Picture producers and distributors
Speaker 1: of America Will h Code. Now I'm just kidding. It
Speaker 1: was Will H. Hayes. That was his name, and the
Speaker 1: Haze Code was meant to perform triage on Hollywood's image.
Speaker 1: Like I said, the movie business was seen as something
Speaker 1: of a seedy thing, especially because around this time there
Speaker 1: were some really nasty scandals that were surrounding Hollywood. Uh,
Speaker 1: scandals that involved stuff like sex and death. It was
Speaker 1: not a not a good thing too to have if
Speaker 1: you're trying to put forth the the aura of respectability.
Speaker 1: So the movie business was no stranger to scandal, both
Speaker 1: on and off screen, and the US government was kind
Speaker 1: of starting to think about ways that they might censor
Speaker 1: the film industry. So rather than have the government come
Speaker 1: in and regulate the movies, the goal was to create
Speaker 1: a code of standards of what was and wasn't suitable
Speaker 1: to show in movie theaters and head off the US
Speaker 1: government at the past and have movie studios sign on
Speaker 1: to you know, produce films under this code. For the record,
Speaker 1: this is something that has happened numerous times in American
Speaker 1: history with industries that range from comic books to film
Speaker 1: to video games. We've seen it happen again and again.
Speaker 1: The Haze Code was extremely restrictive. Movie studios weren't forced
Speaker 1: to comply to the Haze Code, but generally speaking, it
Speaker 1: was best to play the game if you wanted your
Speaker 1: films to get played in theaters. Warner Brothers scrapped the
Speaker 1: gangster film genre pretty much, as it would be pretty
Speaker 1: challenging to make a compel in gangster movie while still
Speaker 1: holding true to the restrictions of the Haze Code. And
Speaker 1: that's where we're going to leave off for our first break.
Speaker 1: When we come back, we're going to skip forward a
Speaker 1: little bit in time to talk about some other changes
Speaker 1: at Warner Brothers that lead up to the birth of
Speaker 1: Warner Media. We still got a long way to go,
Speaker 1: so let's take a quick break and we'll be right back.
Speaker 1: So the Haze Code would hold true in Hollywood until
Speaker 1: the late nineteen sixties. Warner Brothers continue to make lots
Speaker 1: of movies and cartoons in that time. And this isn't
Speaker 1: a pop culture podcast, so I'm not going to go
Speaker 1: into all of them here. It would just be, you know, ridiculous.
Speaker 1: But Warner Brothers continued to make films in the nineteen
Speaker 1: forties during World War Two. They didn't stop, and after
Speaker 1: the war, television, which had been development for decades but
Speaker 1: had largely been paused during the war, debuted in earnest.
Speaker 1: The movie industry as a whole was not too happy
Speaker 1: about television. They were fearing that people would purchase a
Speaker 1: TV set and then just elect to stay home rather
Speaker 1: than head out for a night at the movies. Now, gradually, studios,
Speaker 1: including Warner Brothers, would expand their operations to include TV productions,
Speaker 1: but at first it was as if you had like
Speaker 1: one giant predator suddenly spotting a totally different predator in
Speaker 1: its home turf and things get real tense. That was
Speaker 1: kind of how it was between movie studios and television
Speaker 1: at the time. In the late nineteen fifties, Warners established
Speaker 1: a subsidiary company called Warner Brothers Records, later known as
Speaker 1: just Warner Records and then later still Warner Music Group.
Speaker 1: This was the recorded music division of the movie studio
Speaker 1: business and largely focused on producing recordings of the various
Speaker 1: soundtracks to Warner Brothers movies, as well as securing their talent.
Speaker 1: One of the things that Warner Brothers executives were upset
Speaker 1: about was that Occasionally, an actor in one of their
Speaker 1: films would record a song and it would get released
Speaker 1: on some other record label, and that meant that Warner
Speaker 1: Brothers suddenly didn't have total control over the talent that
Speaker 1: was signed to them, and they hated that. They wanted
Speaker 1: to make sure that if if that person who was
Speaker 1: signed to a contract was gonna make money by gully,
Speaker 1: Warner Brothers was gonna get a cut of it. So
Speaker 1: that was really the reason why they created a records division.
Speaker 1: Also in the nineteen fifties, Warner Brothers was forced to
Speaker 1: divest itself of its theater chains. This was the consequence
Speaker 1: of a legal battle between the US government and the
Speaker 1: film industry in the United States, and the issue at
Speaker 1: the heart of all this was anti competitiveness. So movie
Speaker 1: studios had been buying up all aspects related to movie production,
Speaker 1: from the actual companies that would process film to the
Speaker 1: content creation side, you know, the actual movie studios, to
Speaker 1: the movie theater side, so everything from production, processing and distribution.
Speaker 1: This was not necessarily great for the average consumer who
Speaker 1: might find themselves with no way to see the latest
Speaker 1: pictures from movie studio A because the one theater in
Speaker 1: their town happened to be owned by movie studio B
Speaker 1: and for actors and directors, there was the issue of
Speaker 1: getting locked into contracts that made them exclusive talent, and
Speaker 1: it meant that the actors wouldn't really have much of
Speaker 1: a say about what projects they pursued. And in addition,
Speaker 1: studios would sometimes barter with other studios and use talent
Speaker 1: as a kind of you know, bargaining chip. It wasn't
Speaker 1: super cool. Uh. There were a lot of other considerations
Speaker 1: too that would into this, but ultimately the important point
Speaker 1: is that the big movie studios all had to spin
Speaker 1: off their movie theater holdings. They couldn't keep them any longer.
Speaker 1: They also weren't allowed to have talent agencies and stuff
Speaker 1: like that, and so this was sort of the beginning
Speaker 1: of the end of the big studio era, although studio
Speaker 1: contracts would still be kind of a thing for a bit.
Speaker 1: And yet another development in the nineteen fifties, Jack more
Speaker 1: Or saw an opportunity, but it would mean doing some
Speaker 1: underhanded stuff. So you see, Harry Warner was technically in
Speaker 1: charge of the company, but Jack Warner was the guy
Speaker 1: who was kind of making stuff happen on the studio level.
Speaker 1: Also not very well liked Mr Jack Warner. A lot
Speaker 1: of his stars positively hated the man. Jack wanted to
Speaker 1: lead the company, but Harry essentially said, over my dead body.
Speaker 1: So Jack one day approaches his brothers, Harry and Albert,
Speaker 1: and he essentially says, Hey, you know what we're all
Speaker 1: getting on in years, we're all getting older. We should
Speaker 1: sell our company off. We had a great run. Let's
Speaker 1: sell it off while we're still on top. We'll make
Speaker 1: a ton of money and we can retire in comfort.
Speaker 1: And the elder brothers agreed, and the studio was quote
Speaker 1: unquote sold but low and behold. A couple of weeks later,
Speaker 1: Jack Warner is revealed as the new president of this
Speaker 1: new Warner Brothers company, which was kind of only new
Speaker 1: on paper. Really, Harry would not last very long. He
Speaker 1: actually died not too long after this happened. And of
Speaker 1: course that narrative is that Jack Warner broke his brother's
Speaker 1: heart and that's what killed Harry Warner. There was definitely
Speaker 1: a schism in the Warner family at this point. This
Speaker 1: was also around the same time that Warner actually created
Speaker 1: its television division called Warner Brothers Television Studios in nineteen
Speaker 1: fifty five, Jack Warner's son in law, William t Or,
Speaker 1: would head up that division. One of their early major
Speaker 1: productions was the first one hour television Western series called Cheyenne.
Speaker 1: The studio would go on to produce lots of other
Speaker 1: shows like Maverick is another great example. In the nineteen sixties,
Speaker 1: the studio began to produce a bunch of movie musicals.
Speaker 1: These were lavish, expensive productions, and they helped convince people
Speaker 1: to you know, leave their homes, leave their televisions behind
Speaker 1: to see these films that they could only see in theaters.
Speaker 1: So they included movies like The Music Man, uh Anti Name,
Speaker 1: and Gypsy. These were all adaptations of Broadway musicals. But
Speaker 1: it was My Fair Lady, which debuted in nineteen sixty four,
Speaker 1: that proved to be a truly enormous success, as did
Speaker 1: the movie's soundtrack, which really helped establish Warner Brothers Records.
Speaker 1: That will come back to Warner Brothers Records a little
Speaker 1: bit later on, but let's stick with My Fair Lady.
Speaker 1: There was one big drawback on that deal. So when
Speaker 1: Jack Warner purchased the rights the film rights to make
Speaker 1: My Fair Lady, it cost him five and a half
Speaker 1: million dollars. This was before they had shot even a
Speaker 1: foot of film. The rights to the film, however, reverted
Speaker 1: to CBS after seven years because CBS was the company
Speaker 1: that had actually financed the original Broadway production that My
Speaker 1: Fair Lady was based off of. So once those seven
Speaker 1: years were up, CBS got the rights, which means that
Speaker 1: while My Fair lay He was a Warner Brothers film,
Speaker 1: it's not in the Warner Brothers library today. In nineteen
Speaker 1: sixty six, Jack Warner decided to sell Warner Brothers for
Speaker 1: real zies. This time he kind of faked it out
Speaker 1: the decade earlier, and now he's actually doing it. He
Speaker 1: sold off his controlling shares of the company to another
Speaker 1: company called Seven Arts Productions for thirty two million dollars.
Speaker 1: He stayed on with with the Warner Company in various roles,
Speaker 1: um but he irritated the heck out of the Seven
Speaker 1: Arts Productions folks. So let's talk about Seven Arts for
Speaker 1: a second. Seven Arts Productions made movies, but did not
Speaker 1: distribute movies. So instead Seven Arts Productions would make films
Speaker 1: and then partner with other studios for their release. Three
Speaker 1: film professionals had founded the company in nineteen fifty seven,
Speaker 1: and they were able to make films using a more
Speaker 1: independent studio approach. So like one of those films was
Speaker 1: Whatever Happened to Baby Jane, which they made on behalf
Speaker 1: of Warner Brothers. Warner Brothers actually distributed that film. The
Speaker 1: studio films were successful enough to give the owners the
Speaker 1: cash they needed to buy out Jack Warner in nineteen
Speaker 1: sixty six. So this new company was called Warner Brothers
Speaker 1: Seven Arts, and the logo changed to the W B
Speaker 1: shield was now a stylized combination of the letter W
Speaker 1: and the number seven. So if you've ever seen a
Speaker 1: really weird looking Warner Brothers logo, it might be that one.
Speaker 1: To be fair, there's been a few weird Warner Brothers logos.
Speaker 1: So if it looks like there was a number seven
Speaker 1: merged onto the end of a W, that would be
Speaker 1: this era. And the deal included Warner Brothers Studios, all
Speaker 1: of the black and white Looney Tunes catalog, and Warner Records.
Speaker 1: So why just the black and white Looney Tunes catalog. Well,
Speaker 1: that's a really complicated story all by itself. It mostly
Speaker 1: involves how Warner Brothers handled the rights to various cartoons
Speaker 1: during the early era of television. The company originally made
Speaker 1: these cartoons to play in movie theaters, not for TV,
Speaker 1: and Warners didn't have an established television studio in the
Speaker 1: early nineteen fifties, so the company sold television distribution rights
Speaker 1: to a few different companies, including one that was called
Speaker 1: Guild Films. That was the one that got the black
Speaker 1: and white ones. But Guild Films would go bankrupt, and
Speaker 1: then Seven Arts Productions acquired that company's assets. So technically
Speaker 1: the distribution rights to the black and White ones already
Speaker 1: belonged to Seven Ages Productions, but now they also owned
Speaker 1: the company that made it. The distribution rights to the
Speaker 1: other cartoons belonged to other companies. And I'm not going
Speaker 1: to get into all that because wolf y'all, this is
Speaker 1: already complicated enough as it is. The company did also
Speaker 1: acquire Atlantic Records, which joined the Warner Records label as
Speaker 1: a music label owned by this bigger media company. So
Speaker 1: Warner Brothers Seven Arts was a new movie and record
Speaker 1: company that lasted all of nearly three whole years. Why
Speaker 1: is that, Well, partly it's because the company overextended itself
Speaker 1: with all these acquisitions, which is something we see way
Speaker 1: too frequently in business and partly well it's because of
Speaker 1: the mob and parking lots and window cleaners plus a
Speaker 1: funeral home. All right, hear me out, because things are
Speaker 1: about to get way more bizarre. Okay, So for this
Speaker 1: part of the story, we gotta go way way back again,
Speaker 1: back before time. Not not you know, time is in space,
Speaker 1: time or the experience or whatever. I mean, time incorporated.
Speaker 1: So we're gonna go back to eighteen six. That's when
Speaker 1: Max Swag founded a window cleaning company that he called
Speaker 1: National Window Cleaning and House Renovating Company, and it was
Speaker 1: in New York City. A guy named Louis Frankel joined
Speaker 1: the company in the early nineteen hundreds and the name
Speaker 1: changed slightly to National House and Window Cleaning Company. In
Speaker 1: nineteen thirty seven, Max passed away, Frankel ended up leading
Speaker 1: the company. Uh Frankel died a decade later in nineteen seven,
Speaker 1: and his son, William Frankel took over the company. At
Speaker 1: that point, the name of the company changed again and
Speaker 1: became the National Cleaning Contractors, Incorporated. William Frankel would oversee
Speaker 1: operations at the company until nineteen sixty six, which is
Speaker 1: when a different company swoops in to acquire it, and
Speaker 1: that company was Kinney Service Corporation. Now, for some reason,
Speaker 1: the Antitrust Division of the Justice Department opposed this merger.
Speaker 1: I think I know why, but I couldn't find anything
Speaker 1: like firm about it. However, I do know that Kinney
Speaker 1: Service Corporation was let's say, it was creative in the
Speaker 1: way it did business, So I'm gonna switch over to
Speaker 1: them now. So, while the cleaning company was doing business
Speaker 1: in New York City in the nineteen forties, you at
Speaker 1: another company that was taking shape over in New Jersey.
Speaker 1: This one was founded by Sigmund dornbush Manny Kimmel and
Speaker 1: mob boss Abner's Willman. Now, I'm sure you've heard that
Speaker 1: the mob was involved in Hollywood to some extent, but
Speaker 1: I'm not sure that you guessed it came from a
Speaker 1: parking lot company in New Jersey, huh. Anyway, the three
Speaker 1: of them founded the Kenny Parking Company. Anyways, Willman is
Speaker 1: not really part of our story here because the merger
Speaker 1: we're going to talk about happen in nineteen sixty six.
Speaker 1: Willman died under potentially controversial circumstances. In nineteen fifty nine,
Speaker 1: he was found hanged, but some argued that it was
Speaker 1: suicide and some argued that it was murder. I don't
Speaker 1: know what the truth of the matter is, but anyway,
Speaker 1: in the early sixties, the parking Company formed a partnership
Speaker 1: with a rental car company owned by Edward Rosenthal. And yeah,
Speaker 1: this is getting more complicated. I'm sorry. The partnership worked well.
Speaker 1: It was the Abbey rent a Car Company, and a
Speaker 1: couple of years later, these two companies, the parking Company
Speaker 1: and the rent a car company, decided that, hey, this
Speaker 1: works so great, let's merge and make a single company. Now.
Speaker 1: In that process, Rosenthal decided he would bring in some
Speaker 1: of his other concerns, some of his other companies that
Speaker 1: he owned, which included a funeral home called Riverside Memorial
Speaker 1: Chapel and another company called the City Service Cleaning Contractors incorporated.
Speaker 1: This collection of rag tag companies became the Kinney Service Corporation,
Speaker 1: which I mean, I guess you've got to call it
Speaker 1: something and and it is hard to come up with
Speaker 1: a name for a company that has divisions that specialize
Speaker 1: in parking lots, window cleaning, rental cars, and funeral homes.
Speaker 1: I'm drawn a blank here, so I guess Kinney Service
Speaker 1: Corporation it is. The company also bought up nine more
Speaker 1: funeral homes too. They really took service to a new,
Speaker 1: really weird level. Edward Rosenthal's daughter Carol, married a man
Speaker 1: named Steve Ross, and in nineteen sixty six, Kenney Service
Speaker 1: Corporation merged with the National Cleaning Contractors, the one that
Speaker 1: was founded in eighteen six. And I'm guessing that the
Speaker 1: Department of Justice was worried that the cleaning National Cleaning
Speaker 1: Contractors and the the City Service Cleaning Contractors that were
Speaker 1: part of Kinney could have represented an anti competitive monopoly
Speaker 1: in cleaning. That's the only thing I can guess. Anyway,
Speaker 1: whatever the beef was, the merger still happened, and the
Speaker 1: new company had the name Kinney National Company, and Steve
Speaker 1: Ross took the helm. We'll talk a little bit more
Speaker 1: about Kinney National Company and what happened next after this
Speaker 1: quick break. In nineteen sixty seven, the Kinney National Company
Speaker 1: purchased a publishing company called National Periodical Publications. But you
Speaker 1: probably know that company better as d C Comics. Yep,
Speaker 1: this is how d C Comics would eventually become part
Speaker 1: of the Warner Brothers family. By way of a funeral
Speaker 1: home slash window cleaning slash parking lot company, you know, naturally. So,
Speaker 1: just so we're clear, Warner Brothers didn't so much as
Speaker 1: acquire d C Comics, as both DC and w B
Speaker 1: got gobbled up by the same company. Steve Ross, the
Speaker 1: head of Kinney National Company, must have had a real
Speaker 1: love of the movie industry, because he, in short orders
Speaker 1: set about using the newly merged companies assets to acquire
Speaker 1: companies in the business that is show. He bought a
Speaker 1: talent agency, and he bought the Cabra and Lynn company
Speaker 1: Pana Vision, and he had his eye on Warner Brothers. Now,
Speaker 1: as I mentioned earlier, Seven Arts Productions purchased Warner Brothers
Speaker 1: from Jack Warner for thirty two million dollars a few
Speaker 1: years earlier. Then they went and purchased Atlantic Records, and
Speaker 1: they ended up being a little strapped for cash. Ross
Speaker 1: was given a hot tip about it from the owner
Speaker 1: of the talent agency they had acquired, and so he
Speaker 1: made an offer to the heads of Warner Brothers seven Ages,
Speaker 1: and they accepted it. The offer was for sixty million
Speaker 1: dollars for four hundred million dollars. Honestly, I found a
Speaker 1: lot of conflicting information about this um. I tend to
Speaker 1: believe the sixty million more than the four hundred million,
Speaker 1: but I kept coming up against different amounts. Anyway, the
Speaker 1: companies ended up merging, and consequently Kenny National Company would
Speaker 1: sell off its talent agency because otherwise that would be
Speaker 1: seen as being anti competitive to have both movie studio
Speaker 1: and a talent agency, not just a movie studio, a
Speaker 1: television studio too. Ted Ashley, who had previously overseen said
Speaker 1: talent agency, would become the head of the new Warner
Speaker 1: Brothers Incorporated. Around this time, Jack Warner officially retired from
Speaker 1: Warner Brothers, but he continued to work with the company
Speaker 1: in some respect for nearly another decade until his death.
Speaker 1: As for the new Warner Brothers Incorporated, it ran into
Speaker 1: some trouble before too long, but for once it wasn't
Speaker 1: because of the movie side of the business, at least
Speaker 1: not overtly. Rather, there was a price fixing scandal that
Speaker 1: focused on the parking operations of the company, and so
Speaker 1: in an effort to kind of salvage operations, the company
Speaker 1: leaders decided that they needed to split this company into two,
Speaker 1: so in one company would be all the entertainment assets
Speaker 1: such as the Warner Brothers Movie Studio, the television studio,
Speaker 1: the record studios, cetera. The other company would be everything else,
Speaker 1: you know, window washers and funeral directors and parking lots
Speaker 1: and all that kind of stuff. So what we got
Speaker 1: was Warner Communications on one side and the Kinney National
Speaker 1: Company on the other side. So now we can say
Speaker 1: goodbye to Kenny and we'll stick with Warner. Okay. So
Speaker 1: at this point we've got Warner Communications, which serves as
Speaker 1: a parent company, and its subsidiaries include Warner Brothers Studios.
Speaker 1: That's the movie studios, h the Warner Music Group, which
Speaker 1: included not just Warner and Atlantic, but also record companies
Speaker 1: like Asylum, Elektra and more. Then we've got Dimension Pictures,
Speaker 1: which is a film production company or was a film
Speaker 1: production company that was largely known for making movies in
Speaker 1: the exploitation categories. So that includes classics like Dolomite, Returned
Speaker 1: to Boggy Creek, which MST. Three K did an episod
Speaker 1: it on oh In Satan's Cheerleaders, you know, real classics,
Speaker 1: and the company also owned d C Comics and Mad Magazine.
Speaker 1: Warner Communications would make several more acquisitions. In ninety nine,
Speaker 1: it partnered with American Express to create a joint venture
Speaker 1: called Warner Amex Satellite Entertainment, which oversaw cable channels like
Speaker 1: MTV and Nickelodeon and the movie Channel YEP. Those started
Speaker 1: out as Warner Brothers Concerns or I guess Co. Warner
Speaker 1: Brothers Concerns and Warner Communications also purchased a little company
Speaker 1: called Atari in nineteen seventy six. Now I covered this
Speaker 1: in my episodes about Attari several years ago, but let's
Speaker 1: go over a real quick version. So Nolan Bushnell, who
Speaker 1: was leading a Torii when it was a private company,
Speaker 1: had a problem. He was about to launch a video
Speaker 1: game console to the home market. But producing hardware is expensive.
Speaker 1: You have to pay the manufacturing costs, and then there's
Speaker 1: issues like supply chain, both before when you're just getting
Speaker 1: all the parts to put together and after when you're
Speaker 1: shipping the finished units out to retail outlets. It was
Speaker 1: going to require more money than the company had on hand,
Speaker 1: and so Bushnell made the decision to see if some
Speaker 1: other company would be willing to buy Atari and essentially
Speaker 1: foot the bill for production. Warner Communications turned out to
Speaker 1: be that company. In nineteen Warner Communications acquired Attari for
Speaker 1: the princely sum of twenty eight million dollars. It took
Speaker 1: some time for that investment to actually pay off. Early
Speaker 1: issues with manufacturing caused delays, which cost the company a
Speaker 1: lot of money, but things turned around fairly quickly, and
Speaker 1: the success of Atari helped Warner Communications offset some shortfalls
Speaker 1: that the company was experiencing in their movie and music divisions.
Speaker 1: Of course, anyone familiar with the home video game market
Speaker 1: knows what ultimately happened. While the industry was writing high
Speaker 1: in the late seventies and early eighties, sometimes literally, as
Speaker 1: I understand, companies like Atari sometimes resembled more like a
Speaker 1: rock star party than a media company. Anyway, it all
Speaker 1: came crashing down in a glut of consoles and cheap
Speaker 1: games had saturated the market, and consumers were drifting away
Speaker 1: from consoles and toward a new technological wonder, the personal computer.
Speaker 1: The entire industry had a massive collapse, and Atari was
Speaker 1: essentially at the center of it. By the end of
Speaker 1: nineteen eight three, Warner Communications was hurting. Its film and
Speaker 1: music divisions weren't performing so well, and the video game
Speaker 1: division was now in shambles. Warner sold off the parts
Speaker 1: of Atari associated with consumer products, which included stuff like
Speaker 1: consoles and computers and game development, and sold it to
Speaker 1: Jack Tramiel, the former CEO of Commodore. I've done episodes
Speaker 1: about Tramuel in the past. It's kind of a vindictive guy.
Speaker 1: But that's off topic for our discussion about Warner. Warner
Speaker 1: retained the arcade game division of Atari, so they sold
Speaker 1: off the home market stuff, but they kept the arcade
Speaker 1: market stuff. They renamed that Atari Games. So this was
Speaker 1: the great split of Atari into two different entities, and
Speaker 1: it would fracture further from there. And if you listen
Speaker 1: to my episodes about Midway, you might have heard that
Speaker 1: this division of Atari would ultimately shift over to Williams
Speaker 1: slash Midway Games, and Atari Games would eventually become Midway
Speaker 1: Games West. So Warner Communications was in some financial trouble.
Speaker 1: In Warner bought out American Expresses Steak in the Warner
Speaker 1: Amex satellite entertainment company. It's the one that owned cable channels,
Speaker 1: and then in Night five, Warner sold this company off
Speaker 1: to Viacom, which has its own incredbly complicated history, but
Speaker 1: for now we'll just say that Warner's brief fling and
Speaker 1: owning cable companies had come to an end for now,
Speaker 1: with Viacom assuming a big chunk of debt from Warner
Speaker 1: as part of this deal. And now finally we get
Speaker 1: to the merger between Time Incorporated and Warner Communications. So
Speaker 1: Time announced in March of nine nine that it was
Speaker 1: going to merge with Warner Communications and thus create a
Speaker 1: new company called Time Warner. But at that same time,
Speaker 1: a company called Gulf and Western later known as Paramount Communications,
Speaker 1: attempted a hostile takeover of Time. And these hostile takeovers
Speaker 1: really big in the eighties, So I guess i'll go
Speaker 1: over that really quickly, just to explain what they are. So,
Speaker 1: typically you have the board of directors of a company
Speaker 1: that makes decisions on behalf of a company, and those
Speaker 1: decisions include whether or not to accept some other companies
Speaker 1: acquisition offer. So if it's a private company that this
Speaker 1: is just These are the people who make all the decisions.
Speaker 1: What they say goes. If they don't want to sell,
Speaker 1: no one sells. But for publicly traded companies like Time Incorporated,
Speaker 1: it's different. So in a publicly traded company, it's possible
Speaker 1: to convince shareholders to agree to an acquisition against the
Speaker 1: wishes of the board of directors. The acquirer has to
Speaker 1: convince enough shareholders to vote for the measure, and then
Speaker 1: even if the Board of directors disagree, the acquisition goes through.
Speaker 1: One way to do this is to appeal to the
Speaker 1: greed of shareholders and promise higher share prices than whatever
Speaker 1: the market currently values them at. Time raised its bid
Speaker 1: for Warner Communications and rushed to complete the merger. Now,
Speaker 1: at this point, the deal was valued at nearly fifteen
Speaker 1: billion dollars, and there were a couple of court cases
Speaker 1: that Paramount Communications brought against this, but Time ended up
Speaker 1: winning those time and time again, and thus the Time
Speaker 1: Warner merger finally got greenlit and we got ourselves emerged company.
Speaker 1: This is a good place for us to wrap up.
Speaker 1: When we come back for the next entry into this series,
Speaker 1: we'll learn more about the business of Time Warner, which
Speaker 1: was pretty complicated and got into things like amusement parks
Speaker 1: and and other things. We'll talk about how a O
Speaker 1: L would fit into all of this not well, by
Speaker 1: the way, and all the messy stuff that would follow
Speaker 1: leading up to the modern take on Warner Media and
Speaker 1: what is going on with the proposed merger with Discovery Communications.
Speaker 1: But that's for the next episode. If you have suggestions
Speaker 1: for other things I should cover on tech Stuff, reach
Speaker 1: out to me on Twitter the handle I use as
Speaker 1: Text Stuff hs W, and I'll talk to you again
Speaker 1: really soon. Tech Stuff is an I Heart Radio production.
Speaker 1: For more podcasts from I Heart Radio, visit the i
Speaker 1: Heart Radio app, Apple Podcasts, or wherever you listen to
Speaker 1: your favorite shows.