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Taking a Bet on BET: Johnson Jumps onto the Small Screen
Johnson was convinced he was onto something. He had no prior business experience, but he was convinced he had discovered an untapped market. Using $15,000 of his own money, he put together a business plan for his new station. With that, he was able to convince John Malone, head of Tele-Communications (TCI) to invest half a million dollars in the venture.
“It doesn't sound like a lot, but to me, from a family of ten, a half million dollars was probably more money than I'd seen in the whole town where I grew up,” says Johnson, “in terms of the whole black population probably didn't have a half million dollars in net worth.”
Johnson then met with UA-Columbia Cablevision president Bob Rosencrans, who owned slots on a cable television satellite. He agreed to let Johnson use those slots for his new black programming channel. Johnson named his new business Black Entertainment Television (BET) and went live for the very first time on January 8, 1980.
BET was the first black-owned broadcasting company on cable television in history. Still, it began as an unimpressive mesh of poor-quality programming. It started with only two hours of old movies each Friday. In fact, for the first five years, BET would only lose money. Soon, however, it began to expand its programming, and cable operators jumped on board. They believed that many of their subscribers would be interested in watching black-oriented shows.
“BET was a business opportunity waiting for someone to put it together,” says Johnson. It might have only begun as a few hours of programming, but it soon expanded into a full-fledged cable station, offering music videos, comedy and religious shows, and college sports – all targeted to an audience that had as of yet gone unnoticed by the previous broadcasters.
Eleven years after its initial launch, BET became the first black-owned company to be listed on the New York Stock Exchange. Today, BET has three spinoff channels and is the largest black-owned cable company in history. Johnson bought back all the BET stock seven years after it went public for $1 billion. He then sold it to media giant Viacom two years later for $3 billion, in a move that pocketed Johnson $1.8 billion.
Although he stayed on as the head honcho at BET, he retired in 2005. Now, he focuses his time on his new company, RLJ Development. Under this umbrella, he has created the largest black-owned hotel company, controlling over 100 Marriott franchises. He also purchased the Charlotte Bobcats for $300 million. In 2006, Johnson also became a founding partner of OurStories, an African American film company.
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