Barry Diller and John Malone, one of the media industry’s premier power couples, are having some relationship issues.
Over the course of a dozen years, with backing from Malone’s Liberty Media Corp., Diller built an $18 billion empire that includes the HSN home-shopping network, Ticketmaster, Expedia and . When business was good, Malone pretty much left him alone.
But lately, the businesses Diller runs haven’t been looking good. The stock of IAC/InterActiveCorp., which Diller heads and in which Malone’s company owns a majority voting stake, is down. And Malone, a cable-TV magnate who refers to the relationship as a “marriage,” is talking as if the union is heading for the rocks.
“There was a time when there was, I think, a 20 percent Barry premium” on Wall Street, Malone noted during a recent interview in his Douglas County office. “Today, you could argue there is a Barry discount.”
Malone is looking to unwind the complex business ties that link him to Diller. So is Diller, who eventually wants his independence.
“We’ve been frustrated with each other at times,” says Diller, who hastens to add that he believes the relationship is still working.
But thus far, they haven’t been able to figure out how to split up. Years ago, Malone gave Diller the power to vote Liberty Media’s shares in IAC. An asset-swapping deal that took shape earlier this year fell apart. And now Malone is asserting his influence.
“The hook is set. It is our company,” he says of IAC. “Barry ain’t going to be able to spit the hook.”
The jockeying by the two moguls comes as broader unrest sweeps through the entertainment and media industries. New technologies are threatening traditional businesses such as television and movies, leaving some old-school moguls scrambling to cope with a rapidly changing landscape.
Diller, 65, and Malone, 66, are accustomed to being thought of as the biggest intellects in the room. Both men are headstrong, and they share an obsession with dealmaking. But they have little else in common.
Diller and Malone met more than two decades ago when Diller was running Paramount. Diller recalls being impressed by Malone’s Ph.D. in operations research from Johns Hopkins University and his reputation for shrewd and complex investments.
