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Malone says 'dust-up' with Diller over spinoff just business

By Jeff Smith, Rocky Mountain News (Contact)

Published July 1, 2008 at 10:06 a.m.

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John Malone

John Malone

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John Malone called the recent "dust-up" with former close friend Barry Diller an unfortunate dispute that "tested some nerves, cost a little legal money."

In a 40-minute interview Tuesday with the cable station CNBC, the chairman of Douglas County-based Liberty Media acknowledged he may have provoked Diller with some critical comments to The Wall Street Journal last fall about how Diller was running IAC/InterActiveCorp.

But Malone maintained that the recent legal dispute over IAC's spinoff of HSN, Ticketmaster and other units wasn't really a personal fight but instead a business decision.

"We have a CEO (Greg Maffei) who believed very strongly in - in the positions that he took," Malone said. "And you know that's why you have a CEO."

Liberty Media supported the spinoff, but accused Diller of trying to dilute its stake. Liberty lost the initial court battle, but recently came to a settlement in the case.

Malone also told CNBC he doesn't believe the U.S. is anywhere near the bottom in terms of the housing and credit crunch.

"I do think we're in a recession," Malone said, adding that he thinks the country's economy is in a "lot of trouble."

On the housing crisis:

"The housing crisis (has) destroyed an awful lot of capital and financial institutions. And it will continue to do so. And that's made financial institutions unable to provide credit support to the economy."

Of the impact on the country's largest satellite TV company, DirecTV, which Liberty now controls

"You can pay for a satellite subscription for a month for what one trip to the movies is gonna cost."

Of possible mergers with telcos such as AT&T

"I think it's perfectly logical . . . that the phone companies and the satellite companies will align with each other over time. Not necessarily combine, but align. And bundle (products)."

Of a possible DirecTV-Dish Network merger:

"Love it. It would be wonderful. But I don't think it's feasible with the antitrust situation as it exists today."

Malone's view of Dish Network

"We know Charlie very well. He's a neighbor. And you know, we get along great with him. . . . We've explored and continued to explore ways to jointly invest in content, to jointly invest in ad sales, to jointly invest in backhaul, to jointly invest in platform."

Of Liberty Global, an international cable firm

"If you add the DirecTV distribution to the Liberty Global distribution . . . makes us twice as big as Comcast in terms of . . . pay subscribers - video subscribers."

Of his relationship today with Diller

"I think we're still friends. But, you know, I mean, you get into these things that are - that are awkward."

Of the ownership of the Atlanta Braves as a result of a stock swap with Time Warner:

"After growing up with the Yankees it's pretty hard to fall in love with a team that's 1,800 miles away. But, you know, it's - it's fun. It's fun for the guys to have a team to root for, be involved. As you know, it was . . . financial structure motivated. But we love the asset."