Chapter 298: Barry Diller

At The Carlyle, New York, Rudy Giuliani introduced Arthur to a New York State Congressman, Joseph Brown.

"Good evening, Arthur," Joseph Brown shook hands with Arthur.

"Good evening, Mr. Brown," Arthur held congressmen in high regard, be they senators or representatives.

"The initiative to revitalize Times Square has the support of Hollywood entertainment groups like Galaxy. This is crucial for Manhattan's development!"

Reading between the lines, Arthur knew he was inquiring about the Galaxy Plaza skyscraper project. "As America's and the world's financial center, Manhattan attracts over ten million tourists annually. Times Square is a historically significant location in New York. We have a duty to preserve it. Galaxy Group is planning to construct a new mixed-use building in the vicinity, set to break ground next year."

Joseph Brown smiled as he clinked glasses with Arthur. "You truly are Hollywood's golden boy."

Next, Arthur was introduced to various influential figures, including:

- Arthur Sulzberger Jr. of The New York Times' owning family;

- S.I. Newhouse of Conde Nast, which owns The New Yorker, Vanity Fair, and Vogue;

- Steve Roberts from the Roberts family, owners of Comcast;

- And Hollywood stars like Robert De Niro and Kevin Costner.

"Arthur, can I have a word?" Barry Diller suddenly approached Arthur.

"Of course, Mr. Diller, please," replied Arthur, who had been closely following the Paramount acquisition, where Diller was competing with Sumner Redstone.

The two moved to a lounge area, and Arthur couldn't help but speak up. "QVC is now competing with Viacom for Paramount, Mr. Diller. You're a formidable contender!"

Barry Diller shook his head. "QVC's previous bid was $8.7 billion, while Viacom's offer is $9.2 billion. After acquiring Blockbuster, Viacom has raised more funds."

"Oh," Arthur chuckled, "Blockbuster has numerous chain stores; their cash flow must be quite substantial."

Barry Diller looked at Arthur. "I heard that companies like 20th Century Fox, Paramount, Turner Broadcasting, and Disney all had significant interest in Galaxy?"

"Yes, they all wanted to acquire Galaxy over the past couple of years," Arthur shrugged. It wasn't exactly a well-kept secret.

"Being bought out is indeed an unpleasant feeling," Barry Diller remarked as he called over someone to bring two glasses of wine.

He clinked glasses with Arthur. "Have you ever thought about becoming one of the rule-makers yourself? You should know that MGM aside, the Big Six studios are the top players in the American film industry.

With the MPAA rating system and robust international distribution channels, they can set numerous obstacles for new independent film companies!"

Arthur smiled. "These things aren't set in stone, like RKO's demise, and United Artists' defeat. Universal and Columbia also started with low-budget films, right?"

"It seems you're quite confident!" Barry Diller considered Galaxy's current success. The summer box office performance was indeed unbeatable.

Arthur remained composed. "Mr. Diller, let's cut to the chase."

Barry Diller pondered for a moment. "I want to team up with you to acquire Paramount Communications. Although Paramount's board says the highest bidder wins, with Galaxy's involvement, the outcome would be different. Combining Galaxy with Paramount would make us the market leader. With you onboard, Paramount's board would seriously consider this. An insider designated as the future leader carries significant weight."

"Hmm," Arthur looked at the wine in his glass. "Mr. Diller, you mean QVC would team up with Galaxy to acquire Paramount, while I would still be your deputy?"

"Uh," Barry Diller paused and then looked at Arthur's unchanged expression. "I've already persuaded several Wall Street investment firms to provide financing. And besides, I'm getting older. Eventually, Paramount and Galaxy would be yours anyway!"

"Sigh," Arthur sighed powerlessly, looking at Barry Diller. "Given the current trend, Paramount's asking price will surely exceed $10 billion. QVC's valuation is no more than $1 billion at best. My Galaxy, with its cable TV network shares alone, is worth more than QVC.

Not to mention Galaxy Films. With Galaxy's current tremendous growth, why would I team up with a TV shopping network to acquire Paramount?"

Barry Diller stared wide-eyed, "But it's Paramount, Arthur. You'd become the head of Hollywood's premiere film group! Isn't that incentive enough?"

Arthur shook his head, exasperated. "What I'm saying is, why should I bring you along when it's you who should be bringing me? My Galaxy is now Hollywood's most profitable company. In two years, I've made more achievements than you have in twenty years.

Mr. Diller, think about this: what makes you, entirely reliant on investor funds, eligible to be my equal? My current assets are higher than Sumner Redstone's. The Redstone family doesn't hold much equity in Viacom."

Arthur finished his drink. "In my eyes, your attempt to acquire Paramount is a no-win situation. As for Viacom's determination, you should be aware. Without a $10 billion bid, Paramount's board won't be moved.

Don't tell me your investment backers are willing to valuate Paramount at $10 billion. You know the current state of Columbia and Universal.

With increasing debts, you don't want to follow in Sony and Panasonic's footsteps, right?"

Barry Diller was dumbfounded, looking at the confident and bold Arthur Smith. Are today's young Hollywood personalities all this self-assured and arrogant?

Arthur stood up. "Mr. Diller, Hollywood has entered a new era. You belong to a bygone age. Paramount's board isn't foolish. Your purely leveraged buyout can't compare to those with strong backing."

Watching Arthur leave, Barry Diller's face fluctuated unpredictably as a feeling of powerlessness overcame him. The opponent was not only young and vigorous but also exuded authority, unwilling to settle for a subordinate role.

To Arthur, QVC's TV shopping network was insignificant. In comparison, Viacom was a media giant and couldn't match up to Galaxy.

Arthur muttered to himself, "These old Hollywood guard truly can't see the writing on the wall!"

*****

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