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Talking Liberty With President & CEO Greg Maffei

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Greg thank you for being here today and I've been wanted us for a long time. So thank you for being on kindred cast and you seem like you were getting a little bit tired and exhausted just hearing all these titles and responsibilities but imbedded within all of us is superior shareholder returns along the way across the portfolio definitely. You're proud of I think. That's why stills getting to sit in the chair by reference that we met during your three sixty networks days a long time ago when I used to cover the bonds and ran that company which was in fiber company generally speaking like the old days but even with Microsoft. I remember when you made the investment in comcast in one thousand nine hundred seven which was a billion dollar investment in the cable business. You were sort of the first to bring the technology industry together with the media industry and the cable industry in that respect a very long time ago. When I was at Microsoft we were very interested. In what the cable industry was doing to build out high speed data build out the high speed Internet Bill Gates and I spent a bunch of time with a lot of people in the cable. Business including Brian Roberts comcast including John Malone thrilling. When I first met him back in ninety three we tried to sell them set top boxes. We tried to drive a lot of things. We were very instant what they were doing with at home. Which was the primary vehicle. Another one road runner which are the primary consortium vehicles to build up that high speed data and eventually Ryan Roberts is the one I said. Look if you want to help us. You should put money and all the cable companies but the only one who really stepped up and wanted our money. Initially we did a bunch more Brian. So then we ended up buying seven percent of comcast and I was on observer on the board so that was my first exposure to cable. Yeah it was a real catalyst. I remember for evaluation starting to rise again people's concerns being alleviated about what the future of cable could be seen as perpetual petrol theme right when you have these traditional media businesses that are always count out in the age of Technology and innovation disruption. And all of a sudden you have real endorsement and it sustains itself and brought Bannon's everything else obviously there are examples that went the other way like newspapers and other things you know. We were lucky twice or I've been lucky twice to catch the right cycle. We did very well in that comcast investment road at up on the growth of high speed data. And then really again when we did charter in two thousand thirteen sort of caught if not a bottom of near bottom on the industry's accelerated since yeah. Is that the way that you think about? Investing and think about buying companies is that you're somewhat countercyclical because obviously given your perch and your history in the industry you could have expertise in any number of areas. So how do you prioritize it? What do you think about? What drives your successes your approach? I wish we were that systematic or organized. Yeah you definitely have to have a thesis and oftentimes. It's gotTa be tacking against conventional wisdom because conventional wisdom gets valued to the Max. And if you're following along that's a really hard place to be. It may work for a while and it kind of momentum play but it's hard to sustain so finding things are out of favor is certainly a good place to start and doesn't mean it'll nestle get back into favor but it's a good place to look. I can also speak to. The other side doesn't matter how clever you were in emerging telecom in the early two thousands when I was running sixty when the capital goes away and when the trend blows up on you you're GONNA have a lot of problems all the emerging telecom companies. But when you think about the career and it is a unique path right. And obviously we'll get to the liberty part of your career now but when you think back at your evolution as an executive and as an investor what do you point to to be sort of like those key moments where you've got to be really good at your craft and obviously it's a humbling experience every single day. But how do you think back at your path and wise unique and differentiated versus others again? I'm not sure there's a systematic thing. I've tried to keep my doors open but I know I've also gone just incredibly lucky to be at Microsoft of the right time and place to move. When I was really from Dillon Reed over to CITICORP venture capital eventually get out to Seattle to get an John Malone and for him decide. I was the right person to come here where there was a lot of things that were available to fix. Initially we got some early wins and to have the perch so Microsoft needed my skill set at the time. They really didn't have it. Liberty could use my skill set but I could have end up someplace where a lot of smart people could have filled that role or I could have been someplace where your skill set wasn't necessarily so highly valued so there's a lot of selling yourself short by saying it's all lack. I look back at my business school class. A lot of smart men and women smarter than I am or accomplished who didn't necessarily ended up. Lisa metrics having same mobile success some degree. That's the luck of. Where do they end up? Where did I end up? What was needed at the time when we ended up at that spot right? Well let's talk about how you got the liberty then so Dr John Malone needed a CEO of liberty media. How did that come about? And what came to be where it was attractive to you? I'd known John. Since ninety three and he actually been on the board of three sixty networks investor and three six networks. I've lost all his money there. But he's still talk to me. He said I was good at generating tax losses in early two thousand five or mid two thousand five. I got a call from mutual friend of ours. Who said John Malone wants you to come liberty? Do you want to talk to and you. At Oracle the time Oracle. I only been three. I said sure like to talk to John. I mean I'd known him for twelve years. That Point Pete served on a board company Iran so I knew reasonably well. We'd actually talked about various ways we might work together so John Calls Me and says who could run liberty and I thought he was going to call about me. I said nothing comes right to mind. I think about some names so I called the mutual friend back and said well. He got me but he didn't want my name. He was asking for other names so and the friend said he wants to. He wants. He's just playing with you. Then he called back and said you know maybe you'll be the guy that's pretty funny. Well played so will happen so I joined in November of two thousand five as I there was. I think a bunch of relatively low hanging fruit of things to fix clean up and you know in any job. It's always get some early wins because it gives you credibility to make bigger bets. Yeah did you have a an understanding with John when he became? Ceo of how you both would divide the responsibilities already just all in it together. You were giving us a lot more credit than I think. The only thing I remember John Offer. Let me send something like the future is what you make it or something like that. It was a pretty open canvas and if you look nobody would have predicted enormous change when I joined in five today. What liberty looks like and nobody would predicted where we would go right now in the John. Ri- nobody but was there a mandate was there a vision or an objective or again with more of a two smart people getting together and try and make the right investments. Look I think John Appreciate? I'd come out of the technology side and had some familiarity with that in. Oh five if you WANNA look like a relatively. Technically strong person. Coming out of Microsoft helped compared to being traditional media players. I certainly wouldn't put myself up as a technology expert on a relative basis. That was helped. Yeah we'll plus you understood. I feel like capital structure and CFO like dynamics which would help with tax and shareholder value. And not just strategic deal making. When I was at Microsoft we did all these Put ones we were buying our stock back and we were selling against it and it was sort of a we knew we had big tailwind that we made up a bunch of money on this porn. And it's because it's in your own stock it's tax free. John loved that it was fascinated with that so Chinese doughy say the put warrant guy or something like that he was always happy because that's John Malone kind of play. Yeah well how do we think about liberty media because from the outside looking in just taking a eagle in the sky perspective for a second is unclear whether liberty media is a public private equity firm? That just happens to invest in media assets or Obscene Media Operating Company or to leveraged bet on the industry what is Liberty Media and hatchery benchmark or is it just a unique animal altogether book. I think you could say it's all three of those things in various times. It's malted when I first got here. We really owned very few assets in total on. Qvc was the only one we have any scale. We had a bunch of minority positions. And we've actually swapped for control or more influential positions. Barwane more positions over time. We'd like to think we try to do it. In this parts of the industry with our history as a company with John's vision John's expertise and contacts. We've had some insights into perhaps where we thought things would do. Better and where we thought we'd get worse and been able to trade our way out of those hopefully not inefficient or trade. Are we in to the good ones? And so that's been somewhat of a bet on the best parts of media. We'd like to think from where we could actually make progress. You'd love to be some of these places but you can't get in any smart way so it's not like it's an obvious bad to buy the stock but we've tried to promote the thing to a more operating assets being happy also being places where we have a influential position but on the right side of where the trends are

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