Mark Cuban was a guest on "Conversations with Michael Eisner" tonight on CNBC. It was a very interesting show, starting with Ted Turner (Turner Broadcasting, CNN), Sumner Redstone (Viacom) on the show as well. I have had several conversations with Mark over the last several weeks. He is an incredibly bright, passionate, and funny guy.
Ted Turner started off the show talking about how he built TBS from nothing in the early days of cable TV. Turner built the first "super station" WTBS, and was one of the first cable TV entrepreneurs. Turner said he got rich buying all the companies that Eisner (ABC / Disney) passed over. Eisner passed on buying Hanna/Barbera the Saturday morning cartoon producer. Ted Turner bought it for $550M. Ted said others saw a library of cartoons, but Ted saw "The Cartoon Network" and decided Hanna/Barbera would be the basis of this new network he would build. 
Turner and Cuban see things that the average person doesn't. I had a conversation with Mark a few weeks ago about the market value of YouTube and the legal issues. After Google acquired YouTube for $1.65B I sent Mark my financial analysis that pegged the value at about $600M.
Mark's sage response? "the thing about valuing these companies is that its not about what they do now. Its about what their prospective buyers can turn them into. If they have some vision, maybe that price is cheap. If its just about doing business as is, maybe that price is expensive."
On High Definition TV Mark said "I looked at HD TV and I saw a PC. Everyone else looked at it and saw a $10K monstrosity that no one would buy." "I just started working backwards in terms of bandwidth. If every TV network goes Hi Def, there is not enough bandwidth to go around. They just don't see it yet."
Mark Cuban is a visionary, but deep down he is just a passionate guy that loves to compete. Eisner compared Cuban to Sumner Redstone and said wouldn't you like to be in his place? Cuban said "No, I would rather build it than buy it...build it and go through the process. To me, the fun is...the sport of business. That is what I get into."
Sports and business are Mark Cuban's two passions. He does both at a very high level. Mark has plenty of money. It is all about the competition...and the fun.
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Mark Cuban is lucky not smart. The YouTube guys are smart. The only reason Yahoo! paid a stupid $6.6 billion for Broadcast.com is because the analysts in the day said that Yahoo! HAD TO HAVE a broadband "play" to complete. So they bought his company. Broadcast.com was not a viable business model.
Posted by: John Coktosen | October 24, 2006 at 11:57 AM
John, I don't know the YouTube guys, but I do know Mark Cuban and I can tell you he is really smart...and lucky. As for YouTube...they have been extremely lucky too.
You know what they say "Luck is what happens when preparation meets opportunity".
BTW, Broadcast.com was doing $20M a quarter, and on track to do $100M in revenues for the year when Yahoo bought them. They had a very viable business model.
Posted by: Don Dodge | October 24, 2006 at 11:48 PM