Harvey Kirck

Harvey Kirck

U.S. Media Mogul

John (Werner) Kluge. Born in Chemnitz, Germany, September 21, 1914. Attended Wayne State University, Detroit, Michigan; Columbia University, B.A. in economics 1937. Married: 1) Theodora Thomson, 1946 (divorced); 2) Yolanda Zucco, 1969 (divorced); children: Samantha and Joseph; 3) Patricia Rose Gay, 1981 (divorced, 1990); child: John W. Kluge II. Served in U.S. Army intelligence, 1941--45. Immigrated to United States, 1922; worked assembly line, Ford Motor Company; vice president and sales manager, Otten Brothers, 1937--41; bought radio station WGAY, Silver Springs, Maryland, 1946; president and director, WGAY, 1946-59; president, New England Fritos, 1947-55; president, Mid-Florida Radio Corporation, Orlando, 1952-59; president and director, St. Louis Broadcasting Corporation, 1953-58; president, New York Institute of Dietetics, 1953-60; president and di­rector, Pittsburgh Broadcasting Company, 1954-59; president, treasurer, and director, Capitol Broadcasting Company, Nashville, Tennessee, 1954-59; partner, Nashton Properties, Nashville, 1954-60; owner, Kluge Investment Company, Washington, D.C., 1956-60; president and director, Washington Planagraph Com­pany, 1956-60; founder, with David Finkelstein, wholesale food operation Kluge, Finkelstein and Com­pany, Baltimore, Maryland, 1956; partner in Texworth Investment Company, Fort Worth, Texas, 1957-60; president, treasurer, and director, Associated Broad­ casters, Inc., Fort Worth-Dallas, 1957-59; chair of the board, Seaboard Service Systems, Inc., 1957-58; trea­ surer and director of television operation, Mid-Florida Radio Corporation, 1957-60; partner in Western Ne'w York Broadcasting Company, Buffalo, New York, 1957-60; president, Washington Food Brokers Associ­ation, 1958; president, Metropolitan Broadcasting Company (became Metromedia, Inc., 1961; the Metromedia Company, 1980s), 1959; bought Work Wide Broadcasting (WWB), 1960, sold WWB, 1962 vice president, later president and chairman of the ex­ecutive committee, United Cerebral Palsy Research and Educational Foundation, from 1972; purchased Texas-based LOS, 1983; bought Florida-based Net­work 1, 1984; purchased all outstanding shares (72 percent) of Metromedia Company, becoming sole owner, 1984; sold off most Metromedia assets. 1984-92; became 69 percent owner, Orion Pictures, 1988; merged Metromedia Long Distance with long-­ distance divisions of International Telephone and Tele-­ graph (ITT), forming Metromedia-ITT, 1989; merged Metromedia-ITT with Resurgens Communications Group and LDDS Communications to form LOOS Metromedia Communications, 1993. Chair of the board, treasurer, director, Kluge, Finkelstein and Com pany, from 1993; chair of the board and treasurer, TriSuburban Broadcasting Corporation and Washington, Kluge and Company; chair of the board, president, and treasurer, Washington, Silver City Sales Company; di­rector, Marriott-Hot Shoppes, Inc., Chock Full O' Nut­ Corporation, National Bank of Maryland, Waldorf As­toria Corporation, Just One Break, Inc., Belding Hem­inway Company, Inc.; board of directors, Bear Steam, Companies, Inc., Shubert Foundation, Occidental Petroleum Corporation, LDDS Metromedia, and national advisory board, Chemical Banking Corporation; trustee, Strang Cancer Prevention Center; chair, James Madison National Council of the Library of Congress . Member: advisory council, Manufacturers Hanover Trust Company; board of governors, New York College of Osteopathic Medicine; National Association of Radio and Television Broadcasters.

John Kluge.

Photo courtesy of Broadcasting & Cable

Bio

     John Kluge ranks as one of the least-known but most powerful moguls in the history of the modern television industry in the United States. The major television networks and their affiliates deservedly draw the most attention, but Kluge proved that a group of independent TV stations could make millions of dollars. His Metromedia, Inc., pioneered independent station operations through the 1960s and 1970s. In the mid­ 1980s, Rupert Murdoch offered Kluge nearly $2 billion for the Metromedia stations, which then served as the basis for Murdoch's FOX television network. This deal made Kluge one of the richest people in the United States.

     It was the food business that led Kluge to television. In 1951 he invested in a Baltimore, Maryland, food brokerage enterprise, increased sales dramatically, sold his majority stake in the mid- l 950s, and began to look for another industry that was growing. He found television. In 1956 Kluge was too late to enter network television, but he saw possibilities with independent TV stations. He assembled an investment group and purchased the former DuMont stations. He ran Metro­ media on a tight budget, saving rent, for example, by headquartering the company across the Hudson River from New York City, in Secaucus, New Jersey. He seized upon the programming strategy of simply rerunning old network situation comedies and low­ budget movies. And Metromedia made millions with relatively small audiences, because costs of operation were so low.

     Under his stewardship, Metromedia grew into the largest independent television business in the United States. Afterward, Kluge purchased assorted businesses to add to his Metromedia empire. Over the years he acquired the Ice Capades, the Harlem Globetrotters, music publishing companies holding such titles as Fiddler on the Roof, Zorba the Greek, and Cabaret, television production and syndication units, Playbill magazine, and a highly profitable direct-mail advertising division. But he did make mistakes. One disastrous misstep was Kluge's 1960s purchase of the niche magazine Diplomat; another came with his proposal for a fourth TV network. Neither project succeeded, and the failures cost Metromedia millions of dollars.

     Kluge reached his greatest successes in television by buying the syndication rights to M*A*S*H. With this asset, he finally gave rival network affiliates a contest for ratings in the early fringe time period. Not one to sit still, during the early 1980s Kluge cooked up a deal to take Metromedia private. In 1984, by structuring a $1.3 billion leveraged buyout on unusually favorable terms, Kluge ended up owning three-quarters of the new company and pocketing $115 million in cash in the process. With Metromedia now private and under his full control, Kluge did not hesitate when Rupert Murdoch approached him with $2 billion to buy Metromedia's television stations.

     Outside of TV, Kluge attended to his other businesses. Under the Metromedia name, he began to manufacture paging devices and mobile telephones. In managing these telecommunication ventures, Kluge retraced the steps he took in his television career: buy a license in a major market at an affordable price, then wait as the market evolves, and finally cash in.

     In 1995 the Actava Group, Inc., Orion Pictures Corp., MCEG Sterling, Inc., and Metromedia international Telecommunications, Inc., signed an agreement to form a global communications entity to be named Metromedia International Group, Inc. Kluge already owned a major stake in Hollywood's Orion Pictures. The new four-part alliance merged wireless cable and Hollywood production skills to sell all forms of mass communication to citizens in Eastern Europe and the former Soviet Republics.

     Investing and selling has benefited Kluge enormously. His wealth, which Forbes estimated at $5 billion as of the mid-1990s, vaulted him onto the list of the richest people in the United States. By the beginning of the 21st century, Metromedia International was mired in the same economic downturn that pulled down numerous telecommunications enterprises. Following an unprofitable cycle and the bankruptcy of Metromedia Fiber in May 2002, several top managers left the company in the wake of shareholder criticism. In July 2002, Kluge, at 87, resigned as chairman of the board, though he retained control of Metromedia Fiber.

    In 2003 Metromedia Fiber Network Inc. was eased of some of its bankruptcy burden when the telecommunications executive Craig McCaw bought some of its debt in exchange for an agreement that he would own a significant stake in the company when it comes out of bankruptcy. Kluge agreed to back the $25 million that remained after McCaw bought suppliers' claims against the company and agreed to back half of a $50 million stock offering. In 2003 Metromedia Fiber planned to change its name to AboveNet Inc.

Works

  • The Metromedia Story, 1974

Previous
Previous

Klein, Paul L.

Next
Next

Knowledge Network