March April 2006

[David Jamieson]

~G

yes, difficulty factors, just like how it is judged now. But the forms do not have to be all teh same, they just have to contain certain elements that range in difficulty.

[GeneChing]

Warning To Jeff Bewkes: Mess With Former AOL Boss Jon Miller At Your Own Peril (TWX, YHOO)
Peter Kafka | August 3, 2008 7:00 AM

jon miller kung fu aol.jpgWe're still trying to make sense of the puzzling he-said, he-said regarding Time Warner's (TWX) decision to stop former AOL CEO Jon Miller from taking a seat on Yahoo's board. The latest spin we're hearing from the Time Warner camp: Miller and Yahoo (YHOO) may have misinterpreted "body language" from Jeff Bewkes which made them think they had permission to get out of a non-compete. Whatever.

What we do know: We are not going to mess with Jon Miller. Not because of his track record at AOL (for an interesting discussion about Jon's tenure there, check out the back and forth in the comments on our earlier post). But because he can snap us like a twig.

At least, that's the impression we get looking that the photos* in the March/April 2006 issue of Kung Fu Magazine, where Jon explains his study of Chinese martial arts, which he started up 30 years ago.

In the magazine's cover story, Jon describes martial arts not as a kind of violence but as a way to train himself physically, mentally and spiritually. He sounds like the kind of guy who might take this week's setback in stride.

“Chen Taiji emphasizes extremely high levels of precision taught with tiny corrections that have a big impact. Master Ren is a technician. He knows where/how everything should be and is supposed to work. Everything is very precise.” He notes Chen Taiji’s emphasis on precision as “translating to my work in the business world, where small things that start wrong can end up as big problems.”

Miller adds, “As Master Ren teaches, Peng is a connected state of fullness; it is both hard and soft. The concept of Peng can be helpful in dealing with situations like workplace confrontations. You don’t have to meet confrontations head-on, but can yield with them. I don’t say this type of thing in the office, because they don’t think that way, but I do.”

Then again, Jon seems capable of dealing with problems head-on, too. We've double-checked with a knowledgeable source (former AOL employee Ira Weinschel, who was kind enough to direct us to the article), and that is indeed Jon on the cover of the magazine. He's the one using his elbow to separate someone's head from his neck. If we were Jeff Bewkes, and we'd seen that picture, we'd let Jon have any seat he wanted.

* Bonus reason not mess with Jon: He studies martial arts with Lou Reed (yes, that Lou Reed), who took the photos for the Kung Fu article.

18 hours a week - not bad at all.

Internet industry **** Jonathan Miller in high demand
By Jessica Guynn, Los Angeles Times Staff Writer
August 1, 2008
SAN FRANCISCO -- For 18 hours each week, Internet investor Jonathan Miller studies tai chi in New York with legendary master Ren Guang-Yi, whose devotees include Lou Reed, Bette Midler, Hugh Jackman and other celebrities.

During the sessions, Miller's lanky frame flows through fluid, continuous movements, punctuated by quick bursts of energy. Three decades of Chinese martial arts have made his limbs so supple that he can do the splits at 51. And the physical and mental discipline has sharpened his ability to quickly size up and react to situations while remaining calm even in the adrenaline-spiking pitch of combat.

Those skills also come in handy in the corporate setting. Miller has navigated some of the media world's most complex and difficult business challenges, including the attempted turnaround of AOL, Time Warner Inc.'s ailing digital unit. And they have earned him a spot on the short list for some of the Web industry's highest-profile job openings.

He is a prolific venture capitalist with Velocity Interactive Group, a digital media firm. But Microsoft Corp. has contacted him about replacing Kevin Johnson, who oversaw the software giant's online efforts and its bid to buy Yahoo Inc. And billionaire investor Carl Icahn added Miller to the list of board candidates being considered for Yahoo Inc., which is holding its annual shareholder meeting in San Jose today.

After much speculation that he would join Yahoo's board, two people familiar with the situation said Thursday that he might not. Miller and Yahoo declined to comment.

But, clearly, Miller has established himself as a hot hand on the Internet. He made his mark in e-commerce at Barry Diller's media conglomerate, then as chairman and chief executive of AOL, from which he was pushed out in November 2006. He has detractors, particularly inside Time Warner, but gets plaudits from analysts and colleagues who say he is one of the industry's foremost strategic thinkers.

Herb Scannell, CEO of Internet television start-up Next New Networks and former vice-chairman of MTV Networks, calls Miller "one of the smartest guys I have come across in the media world." Geoffrey Sands, who heads McKinsey & Co.'s media and entertainment practice, says Miller thinks several moves ahead of his competitors.

Miller's experience and connections bridge old and new media, arming him with unique and valuable insights, said Peter Chernin, president and chief operating officer of News Corp.

"By any measure, Jon is one of the most astute people about the Internet," Chernin said. "He has really good judgment and a deep intellectual understanding of the Internet. In a world of a lot of flash, he's a guy of real substance."

Soft-spoken and approachable, he has the gift of a Hollywood studio boss for handling big egos without becoming one, colleagues say. Diller, the media mogul, once described Miller as a "first-rate executive" who is "completely sweet and decent."

Jason Calacanis, who founded Weblogs Inc. and sold it to AOL in 2005, said Miller would be a top draft pick for any corporate team. "It's like landing Phil Jackson to coach the Lakers: People want to play for him and people want to play with him," Calacanis said.

Miller has weathered corporate storms. He took over AOL in 2002 during a period of dramatic upheaval. In more than four years there, he helped stabilize the Internet icon and remake it into an ad-driven business to better compete against Yahoo, and he oversaw a lucrative search advertising deal with Google Inc. that gave Google a 5% stake in AOL.

Time Warner replaced him in 2006 with NBC executive Randy Falco. AOL and Time Warner declined to comment this week, but at the time they signaled that they believed AOL needed someone with a stronger vision and more operations experience.

Some weren't so sure. Calacanis, who stayed on after selling Weblogs to AOL, quit in protest. On his blog, longtime AOL executive Ted Leonsis credited Miller with saving AOL from becoming a "case study in failure for business school classes" and creating "a new case study in courageous and visionary leadership."

Pali Research analyst Rich Greenfield said Miller took over AOL in the middle of a crisis and led an important transformation that is "still in process."

Miller grew up in New York and Boston, the son of a noted feminist psychologist and an economist. At Harvard, he majored in psychology and minored in film studies, holding down a job tending bar on the side.

After graduating with honors, he moonlighted as a bouncer at a rock 'n' roll club. A Celtics fan, he became an executive with the National Basketball Assn., focusing on television production and brand marketing. He later held senior positions at Viacom Inc., where he kick-started a British version of Nickelodeon, and with Diller's online division, now known as IAC/InterActiveCorp, where he developed innovative ways to combine the company's Internet, broadcast and cable units.

Miller first encountered Ross Levinsohn in the late 1980s when he was with the NBA and Levinsohn was at a sports agency. The two set a partnership in motion two decades later. Levinsohn left News Corp., where he was president of its Fox Interactive Media unit, two days after Miller left AOL. "His was the second phone call I received," Levinsohn said.

A week later, the two spent an afternoon discussing business and life over drinks at the Beverly Wilshire Hotel. They had bid for many of the same companies and each had negotiated big search deals with Google.

They quickly realized they also shared the same aspiration: to invest in emerging online trends. They formed Velocity and in December merged it with a Silicon Valley firm, ComVentures, which had $1.5 billion under management.

The venture capital game is more rough-and-tumble than it used to be. Fewer venture-backed start-ups are being bought by bigger companies and far fewer are going public. But the pair have developed a philosophy called "connected investing" in which they go after companies in online video, publishing and advertising that can help each other gain traction. In turn, they help start-ups with their connections to big media players.

Both Miller and Levinsohn are sought for their connections and expertise. When Microsoft was contemplating a proxy fight to gain control of Yahoo, it asked Levinsohn to join its slate of board candidates (Microsoft dropped the plan). For now, they both enjoy the challenge of investing in small Internet ventures.

"We have a similar ethos about where the Web is going," Levinsohn said.

[GeneChing]

Yahoo is in our neck of the woods.

Yahoo acquisition rumor buoys stock
Ryan Kim, Chronicle Staff Writer
Wednesday, December 3, 2008

(12-02) 16:34 PST SUNNYVALE -- Shares of Yahoo jumped 7 percent Tuesday following a report that former AOL chief executive Jonathan Miller was interested in buying the struggling search company.

Citing unidentified sources with knowledge of the situation, the Wall Street Journal reported that Miller, who stepped down from his position at AOL two years ago, was talking to private-equity investors and sovereign wealth funds in an attempt to buy Yahoo for $28 billion to $30 billion, or $20 to $22 per share.

Yahoo stock on Tuesday gained 76 cents, or 7.08 percent, to finish at $11.50 per share.

Miller, a partner in Velocity Interactive Group, a venture capital fund, also was previously rumored to be a possible choice for the chief executive position at Yahoo, after founder Jerry Yang said last month that he was stepping down from the post after 18 months on the job.

Yahoo called the Wall Street Journal's report a rumor. "We don't comment on rumors," said Yahoo spokesman Brad Williams, who declined to comment further.

A representative for Velocity said the company would not comment on rumors or speculation. Miller could not be reached for comment.

Analysts dismissed the report, saying it would be unworkable in today's credit markets.

"We think it would be hard to get such a large deal in this credit market for a reasonable price," said Laura Martin, senior media analyst for Soleil-Media Metrics. "The debt and equity costs of raising that kind of money given the current credit conditions would be very difficult."

Martin said unlike a deal with Microsoft, Miller would not be able to enjoy any operational synergies that could save on costs. A deal with Microsoft, however, is looking more unlikely with each passing week, she said, considering Yahoo's straits. And even if Microsoft came back to the table, it would not be offering anywhere near the $33 per share it offered earlier this year.

Microsoft CEO Steve Ballmer said recently that he's not interested in buying all of Yahoo but remains open to a deal combining the companies' search businesses.

The two companies were locked in a public takeover tussle earlier this year when Microsoft tried to buy Yahoo for $47.5 billion. Microsoft eventually walked away after Yahoo insisted it was worth more.

The aborted merger incensed some Yahoo investors, who were hoping for a lucrative payout from the deal. It applied more pressure on Yang to prove the company was on solid ground with firm prospects for the future.

The picture got darker for Yahoo when Google last month backed away from an online advertising partnership, which the Justice Department threatened with an antitrust suit.

Trip Chowdhry, an analyst for Global Equities Research, estimates the company essentially is worth only $8 billion now, about half its current market value. He said the thought of Miller paying a premium for Yahoo is laughable.

"Forget about the premium; Yahoo is a declining asset company," he said. "It just doesn't make sense that someone would pay that much for Yahoo."

Miller was close to joining the Yahoo board this past summer but was precluded from it by a noncompete clause with his previous employer, AOL, which prevented him from working with a rival. That clause is set to expire this spring.

[GeneChing]

If only they had reported he had been on the cover of our mag. If only....

Ex-AOL CEO Miller Isn’t Candidate to Buy or Run Yahoo (Update2)
By Gillian Wee and Tim Mullaney

Dec. 17 (Bloomberg) -- Speculation that Jonathan Miller, former chief of Time Warner Inc.’s AOL, would buy Yahoo! Inc. pushed Yahoo’s shares up as much as 16 percent two weeks ago, as some analysts called him a candidate to replace CEO Jerry Yang.

Yet Miller isn’t trying to buy Yahoo and isn’t a candidate for the firm’s top job, people familiar with the matter said. Rather, as a partner at a venture firm he founded called Velocity Interactive Group, he’s scoping out new media investments at a time when spending in that space is dropping.

“It’s a difficult environment for any business transaction right now,” Miller, 52, said in an interview. “The environment right now is clearly unsettled.”

Miller wouldn’t comment on his reported involvement with Yahoo. Through investments in Web video and online advertising, Miller said he wants to own companies that cater to people who watch television and read the news online.

Venture firms invested only $102 million in first-round financings for media companies in the third quarter, down 45 percent in a year to the lowest levels since 2005, according to a PricewaterhouseCoopers MoneyTree Report.

In July, Miller made headlines when Carl Icahn named him as a potential director for Yahoo when the billionaire investor was seeking to oust the board. Analysts including Laura Martin of Soleil Securities have mentioned Miller as a potential successor to Yang, though a non-compete clause Miller signed bars him from joining any AOL rival until March.

****tail Napkin

In November 2006, the month Time Warner fired him from AOL, Miller started working with Ross Levinsohn, who had left News Corp. as the head of its Internet group. Over ****tails at the Four Seasons in Los Angeles, the pair sketched out ideas on the back of a napkin in seven minutes, Levinsohn recalls.

A year ago, they merged an existing fund they owned with ComVentures, which had raised $300 million in capital and had more than $1.5 billion in assets. The $300 million had been raised based on the promise of early stage and growth investments, Levinsohn said. He and Miller are still looking at investments with what’s left in the fund, Levinsohn said.

“Only people with the most stellar track records can raise money in this market environment,” said Brooks Zug, co-founder of HarbourVest Partners LLC in Boston, which manages more than $30 billion in venture capital and buyout investments. “Many investors prefer to commit where the odds of success are higher because there’s a proven track record.” Zug said he and his partners haven’t spoken to Miller.

Icahn Opposition

Yahoo shares rose after the Wall Street Journal said Dec. 2 that Miller might pursue a takeover of the company. Ashley Huston, a Journal spokeswoman, said the paper stands by the story.

On Dec. 3, Icahn told CNBC that he would oppose a potential bid for Yahoo by Miller. Icahn didn’t return calls seeking comment.

Yahoo may not announce its successor to Yang until January or later, a person familiar with the matter said Dec. 9. Yahoo shares, down 44 percent this year, fell 25 cents to $13.11 at 4 p.m. New York time in Nasdaq Stock Market trading.

Miller and Levinsohn say they’ve been spending their time on the dozen companies they’ve invested in together.

‘Be a Player’

“He wants to be a player, roll companies up, buy divisions of public companies,” said Ted Leonsis, former AOL vice chairman and owner of the Washington Capitals hockey team, who has kept in touch with Miller since they both left the Web unit two years ago. “Jon would be astute at finding and handling them.”

Miller is working on projects such as Next New Networks, which makes Internet television shows in what Miller likens to “the Viacom of the Web.” There’s also FatTail, which helps companies manage their advertising inventory. Miller, who picked up Chinese martial arts 30 years ago to rebuild his strength after getting mononucleosis, also does two hours of tai-chi on weekdays and eight hours on weekends.

“Miller does not have credentials as a big company CEO nor does he have credentials as a turnaround guy since he was fired from AOL by Time Warner,” Soleil’s Martin said.

AOL replaced Miller in 2006 with NBC executive Randy Falco. To counter fleeing dial-up Internet users, Miller had tried to refocus AOL on advertising, introducing services such as music. He led the 2004 purchase of Advertising.com, an online ad network that forms the centerpiece of AOL’s current advertising strategy, for $435 million.

“If you believe in things going forward - these large trends I’ve been talking about - there’s not a better time to be invested in some of these things,” Miller said.