Burn Rate

by Michael Wolff

  No, he was not going to leave Time Warner.

  Machinist showed a brief flicker of impatience. “No doubt, you have a variety of opportunities at Time Warner. Only you can judge their value. What we are proposing, however, is that you come along on the ride we’re going to take this company on. I have worked with a wide range of companies in their various stages of growth. I know what a company is positioned to do and how far it is capable of going. We will do what is necessary to take this company the distance and turn it into a home run. This company has our total support and commitment. Everyone at this table, and the managers perhaps most of all, will realize significant personal wealth within what I will tell you is an extremely narrow window of opportunity.”

  In very precise strokes, Machinist outlined a package of salary, bonuses, and incentives for Judson that would have made an athlete happy.

  Machinist expected further negotiation (in fact, he would have contempt for anything else). Judson, instead, showed the agony of indecision.

  “In the end,” Machinist said spreading his hands. “There’s only one issue. How big are your balls?”

  (While I once thought those were fighting words, in business this seemed to pass as a perfectly reasonable question.)

  “I may not, you know, have the balls,” Judson said plaintively as I walked with him up a sultry Madison Avenue after dinner. Options were killing him. He was clearly torn between the possibilities of substantial personal wealth and great corporate power. As he openly struggled with the choice, it occurred to me, with some surprise, that he honestly believed these were the options. He didn’t regard either as lottery-like. Each, to him, seemed a kind of ineluctable business outcome. My own pessimism suddenly seemed like a tragic flaw, businesswise. Success was surely possible, but it was, I suspected, random; business was, to me, a matter of closing your eyes and making the jump.

  Although I was, once again, charged up by Machinist’s invocation of my imminent personal wealth (not riches but wealth, such an enveloping word), I was fairly sure by now that Machinist would say anything. He spoke in modular units; nearly verbatim paragraphs recurred in disparate conversations. The buttons he pushed were all buttons he had pushed before. Salesmanship, of course, was all about immediate goals. The fact that those goals might have to be contradicted ten minutes after the sale closed was another set of issues.

  Knowing that Machinist could forget my name at any time, I was reluctant to encourage Judson too much. “I think you should think about it. There’s a lot of upside. Of course, upsides always have downsides,” I said.

  On the other hand, I didn’t have huge faith that Time Warner would turn out to be any more reliable.

  It was a world of precarious propositions.

  “Are you really comfortable with what’s going on at Pathfinder?”

  “Why? What do you hear?” Judson snapped to attention.

  “I don’t know any more than you do.”

  “Like, what do you know?” Judson, like everyone at Time Warner, was aware that gossip flows from the company at a marvelous and uninterrupted rate. “Just ‘the black hole’?” said Judson, echoing the words that Time’s CEO Don Logan had affixed to Time’s electronic ventures. “We have a redesign coming up. The redesign will do it! It’s good! It’s good. It’s very good.”

  I sighed. “Do you think Microsoft is just going to shit all over everybody?”

  “In a Business Week article someone from Microsoft gave an unnamed New Media executive at Time Warner the credit for convincing them the Web was the future. Me. Me. That was me!” He shrugged. “We’ll have to see how much Microsoft likes selling ads. You know, it’s different from selling software.”

  This seemed like one of those strikingly obvious truisms that ought to smack Gates alongside the head. Except that maybe in the end the Internet would not be about selling ads. Maybe that was Time Warner’s mistake.

  “You and I go way back together in this business,” I said, wearily.

  “We do.”

  We were the Lincoln brigade, the Stevenson volunteers, present at the creation. We felt good about this. But a little sheepish, too. It was not an industry where experience necessarily paid off.

  I have taken an unscientific poll of Internet hands old enough to remember the early days of the Internet (i.e., before 1994). The question I asked was, If you could pick one event that got the business started, that precipitated the onslaught, what would it be? Remember, prior to 1994 there were still no Internet businesses. There were no Internet executives. There were no Internet entrepreneurs. There were intellectual propositions, an open architecture network. And there were, certainly, intellectual poseurs—avatars of a new way of thinking, communicating, procreating, and so on. But there was no business.

  Nominations for the event that might be considered the Internet equivalent of the assassination of the Archduke Ferdinand, included the following:

  1. The debut of Mosaic, the first piece of software that allowed you to see images on the World Wide Web.

  2. The sudden increase in modem speeds and the drop in prices, quickly bringing the Internet to a one-hundred-dollar 14.4 standard.

  3. The National Science Foundation deregulation decision allowing commercial traffic on the network.

  4. The Murdoch organization’s purchase of Delphi, the online service that first offered national Internet access, a purchase that suddenly called the media business’s attention to the network. It even seemed to many people that Murdoch had bought the Internet (Murdoch’s lurch into the business turned out to be more absurd than visionary—a kind of “let’s buy it because we can afford it” business plan—and presaged Delphi’s long and costly collapse through the creation of IGuide and the Murdoch organization’s ill-fated partnership with MCI).

  There was even a vote for the green card lawyers, Cantor and Siegel, the infamous duo whose junk mail advertisements to Internet newsgroups—spam!—to promote their services as immigration lawyers prompted the wrath of the Internet community, a response that in turn focused attention on the Internet as a potential advertising medium.

  My vote was for Time Warner. Suddenly, quixotically, in 1994, Time Warner turned some of its best minds and brightest lights to the Net, an event that, in addition to sucking me into the vacuum of that organization’s limited knowledge, more than anything else proclaimed the Internet media—with the potential for advertising, personalities, entertainment, OJ! The big boys were ready to play. The game had suddenly gotten interesting.

  Well after even normal Manhattan work hours, one evening in early 1994, I picked up a ringing phone in our office, not half a block from Time’s, to hear a large, embracing, overpowering voice from inside Time Warner:

  “Is this Michael Wolff? The Michael Wolff who knows more about the Internet than anyone in New York? This is Larry Kirshbaum. I want to know everything you know. When can I come over?”

  Everybody knew Kirshbaum. The Celestine Prophecy, Bridges of Madison County, the Madonna sex book, and the Gone With the Wind sequel—all were born in Time Warner’s book division out of Kirshbaum’s overbrimming enthusiasms and phenomenally accurate commercial instincts.

  “You’re so brilliant. You’re so fabulous,” announced Kirshbaum the next day, rushing to embrace every Internet accessory in my office (my modem, my Wired magazine, my T-shirt collection, my conference badges). “You understand. You get it! I love you! We have to work together! We’re going to do incredible things. What can we do? How do you want to do it? Whatever you want. Whatever! We’ll merge! Time Wolff!” he crowed, his face in mine, one hand grasping one of mine, his other hand rubbing my back. A large man with a Lyndon Johnson physicality (reaching, clasping, hugging, rubbing), a watermelon-shaped head, and eyes with an unnatural power surge, it was hard not to get excited by what excited Larry Kirshbaum.

  “In five years there won’t be any books or magazines or newspapers. It’ll be all Net! We’re ready. Come over. Let’s do this! Let’s just do it! We
’ve got to do it!”

  It was two hours of pitched and manic enthusiasm. I came to understand that I had somehow become (at least in Kirshbaum’s mind) the Dalai Lama of New Media, and that, according to Kirshbaum, the world as we knew it, and my life as I had known it, were about to change.

  What the hell.

  I had a whirlwind of Kirshbaum and Time Warner over the next few weeks. I found myself marveling at the speed and efficiency and decision-making process of today’s synergistic megacorporations. I was beginning to believe that Kirshbaum and I were destined to turn Time Warner into the world’s greatest Internet company overnight.

  Then, on a rainy afternoon, as I considered the shape and the direction of Time Wolff and waited for yet another executive from Time Warner to arrive, my revelry was interrupted by a smallish, soaking-wet man who seemed to have somehow gotten by our usually vigilant receptionist. As it happened, he was the executive I was waiting for.

  “Bruce Judson, general manager, Time New Media,” he said, putting out his hand and pulling up a chair to my desk. He had the sense of purpose and entitlement and yet unassuming air of an IRS auditor.

  He was really wet.

  “I have your book,” he said, holding up a dripping copy of NetGuide. “I can’t tell you exactly what we’re planning,” he said in a lowered voice. “We’ll need you to sign a nondisclosure first, but it’s big. We want you to come over and be our consultant.”

  “Yes,” I said. “Kirshbaum has told me all about everything. I’m up to speed.”

  Judson looked momentarily saddened. “It’s all been moved from Larry. We’re centralizing all Internet initiatives. We’re creating a committee to study what Time Warner should do. Larry is of course a very important voice at Time Warner, but he’s not going to be directly involved.”

  “I’m a little confused.”

  Judson seemed genuinely contrite. “I know.”

  I saw political reality setting in. Kirshbaum, who had made a play to go beyond books—a profitable but not glamorous commodity at TW—to the new electronic media, had been brought up short (it was not that easy to escape from books). It also seemed that in my first Time Warner political battle, I was a survivor.

  “The New Media group has been asked to report to the CEO on the company’s Internet options.”

  “Poor Larry,” I said.

  “Oh, he’s a team player.” This would have seemed coldly corporate to me, perhaps the ultimate corporate put-down, were it not for Judson’s own boyish enthusiasm. He was really very excited about the Internet.

  “The committee is me; Curt Viebranz, the executive vice president for New Media, who’s my boss; and Walter Isaacson, the editor of New Media,” he said, as though outlining the prom committee.

  “I know Walter,” I said, tensing.

  Walter was undoubtedly the most successful journalist of my generation. Everyone else I knew at Time in our age group looked so much like water carriers next to Walter. Not only had Walter Isaacson been recognized as a sure shot to the supreme editor’s chair for all of Time and the heir to Henry Grunwald, Time’s last true editorial pope, but he had written (when? at what time of day? with what energy?) two big books about American diplomacy. The first, with Evan Thomas, was The Wise Men. The second, written alone, was a nine-hundred-page biography of Henry Kissinger; it was the definitive work on the Kissinger career.

  There was no faulting Walter’s journalistic talents, so his contemporaries were reduced to something that sounded pretty clearly like sour grapes. I knew an old friend of Walter’s who claimed that he dropped her shortly after her father, a member of a high-brow club, recommended Walter to the club’s membership committee. I knew a writer who seethed at Walter’s prominence on the celebrity-filled Hamptons softball team and couldn’t say enough about the paucity of Walter’s athletic talents. I myself was prone to pointing out that on the many times we had met after the first time (when he had complimented me on a book I’d just written), he never failed to greet me as though for the first time (“Glad to meet you. I’m Walter Isaacson”).

  Every doubt I’d ever had about my own career choices and progress resurfaced when I considered Walter’s success. I was suddenly filled with self-loathing that I would be working with Walter as an Internet person (even as the Dalai Lama of New Media) instead of as a real journalist.

  “I don’t know him that well,” I told Judson, lest Walter not remember me again. “We’ve just met a few times.”

  “But you know what it means that Walter is involved in this?”

  “I think I do.”

  You could say that one of the most significant players in the world’s most significant media enterprise had turned his attention to the Internet, which might well mean that the Internet had arrived; it was going to be as big as television, after all. This was no longer the world of geeky boys and messianics and computer magazines. It was Time Warner, which knew a thing or two about inventing media, about marrying technology to ideas and entertainment and commerce.

  Still.

  It was a bit of a surprise to find Walter Isaacson here. Walter’s was an old-fashioned career: its models were old-fashioned (the journalist as intellectual), its principles were old-fashioned (loyalty to a corporation—he’d worked for the same company since college!). So far, the Internet had attracted people who were pretty nearly the exact opposite of Walter. These tended to be people—like Wired’s Louis Rossetto, for instance—not all that grounded in success and not all that directed in their careers. A certain philistinism seemed to be a help, too. You had to allow for the possibility that the Internet would do weird things to reading, writing, even—egad—editing. Hell, to the whole information structure as we know it.

  One Internet manifesto, propounded (oddly by the mega-pulp author Michael Crichton) in Wired, argued that traditional news organizations were falling way behind the information curve because the Internet gave readers immediate access to primary sources—the same sources that, for instance, Time’s reporters were using. What’s more, it argued, we all had our special interests—sports or business or health or books or politics—which we’d soon be able to follow to our heart’s content online. We’d soon see—as anyone who has ever had firsthand knowledge of an event covered in newspapers and newsmagazines has seen—how news organizations misunderstand the issues, mangle the facts, and generally get it, by a goodly measure, wrong. Such a newfound empowerment and perspective would quickly undermine what credibility these news organizations had left.

  This quickly became the ever-rising mantra on the Net. The way we receive news and information was going to be fundamentally changed. The information end user (i.e., reader) would take control of the experience and the process. The middle men (editors, reporters) and the publications they worked for (Time, for sure) were on their way to the ash heap.

  It was hard not to be infected by this anarchic possibility. For one thing, it was at least a little bit true. For another, you could quickly get a little giddy starting to reimagine the whole structure and basis of the information flow. And, of course, who wouldn’t want to deliver a smarting blow to Time and a tweak to Walter?

  At Time, Walter was the editor of New Media. While that title sounded suspiciously vacant, it put him at number three on the masthead for all of Time, Inc. It was a position without real portfolio, set up so that Walter could do his thing—surprise everyone, find opportunities, expand. Almost every media organization had someone devoted to new media. (New media was supposed to include games like Nintendo, interactive TV, and CD-ROM. In any event, it was certainly not supposed to replace old media. Nor was it supposed to have anything to do with the software business, which was not media at all.) But they were auxiliary types, without real authority. They weren’t princes of the company, like Walter.

  “This is big,” Judson said, lowering his voice. “This is so big! Jerry Levin has taken a personal interest in what we’re doing. He’s going to be paying close attention to what we recommend. A
nd we don’t know a thing about this, so we’re depending entirely on you!”

  While I had offered plenty of people plenty of advice, I had never truly been a consultant before. Consultants appear frequently in the technology business, because the business involves a constant turnover of skill sets and knowledge bases. The technology business is, in effect, the business of acquiring new knowledge. Of the many ways that process can be accomplished, hiring consultants is one of the cheapest (“Maybe you can spend a couple of weeks with us and do a brain dump”). It is, however, often a pretty vague proposition. I would imagine that most consultants are secretly startled that they have ever been hired and, in their heart of hearts, profoundly question the value of the knowledge they have to impart. No one more so than I.

  The Online Steering Committee, of which I was now a member, met on the thirty-fourth floor of the Time Life Building. In all large corporations there is a holy area. The thirty-fourth floor of Time is among the holiest in New York. It is the Manhattan office of my imagination. Think of movies of the ’40s. Secretaries in tight-waisted suits. Hauteur. Formality. Henry Luce.

  The meeting was in the office of the president for Multimedia, Curt Viebranz, and by protocol, Judson told me, would always be in his office when he attended, because in the corporate hierarchy Viebranz, nominally outranked Isaacson, whose office was also on this hallowed floor.

  There can’t be that much real estate left like this in corporate America. Viebranz had a three-office suite. The anterior office was for the secretary/personal assistant. The next room (as large as the largest room in my house) contained, with room to spare, a desk and a conference table and an intimate seating area with couch and easy chairs for five or six; this seemed to be where the work of the world was done. The ultimate room was the private chamber (twice the size of the largest room in my house), and this seemed to be where the executive retreated from the hubbub and distractions of the world.