Cox Enterprises, Inc.

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Cox Enterprises, Inc.

1400 Lake Hearn Drive
Atlanta, Georgia 30319
U.S.A.
(404) 843-5000
Fax: (404) 843-5142

Private Company
Incorporated: 1968
Employees: 30,000
Sales: $2.09 billion

Cox Enterprises, Inc. is a diversified media company. It publishes 17 daily newspapers, 10 weeklies, and one monthly magazine, and operates 21 radio and television stations and 24 cable television systems. It is the largest U.S. operator of automobile auctions, with 46 auction facilities in 1991. Starting in the late 1980s Cox ventured into home video rental and direct mail and point-of-purchase advertising. As of 1990 it was the 14th-largest media company and the 69th-largest privately held company in the United States. Cox Enterprises was not incorporated until 1968; before that it was an assortment of primarily newpaper businesses owned by the Cox family. In 1964 Cox Broadcasting Corporation had been established as a public company to operate the Cox family’s broadcasting and cable businesses.

In 1898 James M. Cox bought The Dayton Evening News— now the Dayton Daily News—in Dayton, Ohio, for $26,000 that he had raised from several friends. Cox, a native of rural Ohio, had been a schoolteacher, a reporter for The Middletown Signal in Middletown, Ohio, and for The Cincinnati Enquirer, in Cincinnati, Ohio, and a Washington, D.C.-based secretary to Ohio congressman Paul J. Sorg. Cox quickly became an influential newspaper publisher; in 1905 he bought the Springfield Press-Republic, also in Ohio, changed its name to the Springfield Daily News, and established a newspaper chain, which he called the News League of Ohio. He also entered politics; he represented Ohio’s third district in Congress from 1909 to 1913 and was elected governor of Ohio in 1913. Cox was defeated when he ran for re-election in 1915, but won in 1917 and 1919, making him the state’s first three-term governor. In 1920 he was the Democratic Party’s presidential candidate, with future-president Franklin D. Roosevelt as his running mate. He lost the election to Warren G. Harding.

After the defeat and his completion of his gubernatorial term in 1921, Cox returned to public life only once, when Roose-velt, by then president, appointed him a delegate to the 1933 World Monetary and Economic Conference in London. Instead, Cox focused on his media business. In 1923 he acquired the Miami Metropolis, in Florida, changing its name to the Miami Daily News, and the Canton News, in Canton, Ohio. In 1930 he sold the Canton paper and bought the Springfield Sun, in Ohio. He entered broadcasting in 1934, establishing Dayton’s first radio station, WHIO.

In 1939 Cox acquired The Atlanta Journal, in Georgia, and its AM radio station, WSB. The newspaper had been founded in 1883 and had gone through several owners; the radio station, which began broadcasting in 1922, was the South’s first. As with other newspapers he had acquired, Cox wished for the Atlanta paper to maintain its own style and personality.

In 1948 Cox entered the new medium of television with WSB-[TV] in Atlanta; the company also set up WSB-[FM] as a companion to the original AM radio station. In 1949 the company acquired a second Dayton, Ohio, newspaper, The Journal Herald, and put WHIO-[TV] and WHIO-[FM] radio on the air in that city. In 1950 Cox acquired The Atlanta Constitution. The Atlanta Journal and The Atlanta Constitution began a combined Sunday edition while publishing separately during the week, an arrangement that continues.

James Cox died in 1957 at age 87. His son, James M. Cox Jr., succeeded him as the leader of the family businesses and oversaw continued expansion. The family acquired AM and FM radio stations and a television station, all operating under the call letters WSOC, in Charlotte, North Carolina, in 1959.

The Coxes were among the first major broadcasters to enter cable television, acquiring a cable system in Lewistown, Pennsylvania, in 1962. In 1963 they acquired KTVU-[TV] in the San Francisco-Oakland, California, area and radio stations WIOD-[AM] and WAIA-[FM] in Miami. In 1964 the Cox family established Cox Broadcasting Corporation to run the radio and television operations. The broadcasting concern had its shares publicly traded on the New York Stock Exchange, but the family retained substantial ownership. The same year, broadcasting and cable operations expanded with the purchase of WPXI-[TV] in Pittsburgh, Pennsylvania, and cable systems in Washington, Oregon, and California.

In 1966 Cox Broadcasting added a business- and technical-publishing division; in 1967 it went into motion-picture production. Its Bing Crosby Productions unit eventually made such movies as Ben, Walking Tall, and The Reincarnation of Peter Proud. In 1968 all the various Cox-owned newspapers were organized into Cox Enterprises, Inc., which remained a private company. The same year, Cox Broadcasting set up Cox Cable Communications Inc. as a publicly traded, partially owned subsidiary.

Another 1968 event was the company’s entry into the automobile-auction business, with the broadcasting group’s purchase of auction facilities in Manheim, Pennsylvania; Bordentown, New Jersey; and Fredericksburg, Virginia. New and used car dealers traditionally have used auto auctions to buy and sell from each other. During the 1980s banks with repossessed cars, car rental agencies, and fleet operators began to use auction facilities for sales.

In 1969 the newspaper group added three Florida daily papers: the Palm Beach Daily News, The Palm Beach Evening Times, and The Palm Beach Post. The broadcasting group’s operations expanded that year with the purchase of Tele-Systems, a California cable operation, and of auto auctions in Kansas City, Missouri, and Lakeland, Florida. An auction facility in High Point, North Carolina, was added in 1970; a cable system in Santa Barbara, California, and an auto auction in Pittsburgh came on in 1971.

The following year brought the acquisition of TeleRep, a national television-advertising-sales representation firm, which sells time on client stations to national advertisers. The firm eventually added a programming arm, Television Program Enterprises, to produce and sell syndicated programming, including “Entertainment Tonight,” “Star Search,” and “Lifestyles of the Rich and Famous.” An auto auction facility in Milwaukee, Wisconsin, also came into the company lineup in 1972.

The presidential election of 1972 brought a break in James Cox Jr.’s association with the Democratic Party. Cox, who had attended the 1912 Democratic convention with his father, decided in 1972 to endorse President Richard M. Nixon for reelection over Senator George McGovern, and ordered all Cox Enterprises newspapers to do the same—the only time Cox ever became involved in the newspapers’ editorial policies. Two editors resigned as a result. Eventually, the family allied itself with the Democrats again; Anne Cox Chambers, one of James Cox Jr.’s two sisters, was an early supporter of Georgia governor Jimmy Carter and served as ambassador to Belgium when Carter became president. In the mid-1970s the Coxes’s Atlanta newspapers switched to a pro-Carter from an anti-Carter stance, but management said the switch was not related to Chambers’s support of Carter.

Also in 1972, Cox Cable announced plans to merge with American Television and Communications Corporation, but the Justice Department sued to block the deal. The suit led the companies to call off the transaction early in 1973; both contended the merger would not violate federal antitrust law, but noted the litigation could delay the deal by several months. Later in 1973, Cox Cable set a merger with LVO Cable Inc., but subsequently called it off because of market conditions. Another major event of 1973 was Cox Broadcasting’s purchase of KFI-[AM], Los Angeles.

James Cox Jr. died in 1974 at the age of 71. His sister Barbara Cox Anthony’s husband, Garner Anthony, took over the primary direction of the family companies, and the expansion continued.

Cox Broadcasting added an auto auction in Orlando, Florida, in 1974, and one in Fresno, California, in 1975. Also in 1975, it bought a cable television system in Myrtle Beach, South Carolina. Cox Enterprises acquired four Texas newspapers in 1976—the Austin American-Statesman, the Waco Tribune-Herald, the Port Arthur News, and the Lufkin Daily News. The same year, Cox Broadcasting added KOST-[FM], Los Angeles, and acquired a cable system in Pensacola, Florida. It also acquired an auto-auction facility in Anaheim, California, and built one in Atlanta.

In 1977 the Cox Cable subsidiary was merged back into Cox Broadcasting; over the next three years, the broadcasting group added 26 cable television franchises, including one in Omaha, Nebraska, and another in New Orleans, Louisiana. Also in 1977, the broadcasting operation acquired WLIF-[FM], Baltimore, Maryland, and Cox Enterprises bought the Mesa Tribune in Arizona.

The broadcasting company acquired WZGO-[FM] in Philadelphia, Pennsylvania, in 1979; the newspaper group acquired Texas’s Longview Morning Journal and The Longview Daily News in 1978 and The Daily Sentinel, of Grand Junction, Colorado, in 1979. Also in 1979, Cox Broadcasting discontinued motion-picture production, but continued to market its inventory, in favor of concentrating on its broadcasting and cable television businesses.

The major event of 1979, however, was the Cox family’s negotiation of a sale of Cox Broadcasting to General Electric Company (GE), in what would have been the biggest broadcasting merger in history. The Coxes wanted to sell the broadcast concern apparently because they feared the Federal Communications Commission (FCC) eventually would force a break-up of their newspaper and broadcast operations in the cities where they had both—Atlanta, Dayton, and Miami. GE’s extensive broadcast holdings, however, resulted in a barrage of complaints to the FCC about concentration of ownership; the delays resulting from these complaints delayed the sale and paved the way for price renegotiations, which led to the deal’s collapse early in 1980. The Coxes were asking $637 million; GE’s final offer was $570 million.

Both Cox companies went through more changes and expansion in the early 1980s. WSB-[TV] changed its network affiliation to ABC in 1980, after having been an NBC affiliate for more than 30 years. Cox Enterprises bought the Tempe Daily News in Arizona in 1980; Cox Broadcasting bought a Boston auto auction in 1981, and KDNL-[TV], St. Louis, Missouri, in 1982.

The broadcasting concern sold its business- and technical-publishing arm to Hearst Corporation in 1980; the aim, as with the end of film production, was to concentrate on the broadcasting and cable businesses. The auto auctions, although unrelated to these businesses, were retained because of their growth and profitability.

In 1982 Cox Broadcasting changed its name to Cox Communications, Inc. to better reflect its positions in both broadcasting and cable. The year 1983 was an acquisitive one. Cox Communications acquired auto auctions in Phoenix, Arizona, and in Toronto, Ontario, and a cable franchise in Staten Island, New “York. The company also agreed to swap WLIF-[FM] in Baltimore for a Chicago FM station, WXFM, whose call letters subsequently were changed to WCKG; to buy a Detroit television station, WKBD, after divesting itself of a cable system in St. Clair Shores, Michigan; and to buy 90% of CyberTel, a radio common carrier system in St. Louis. These transactions were completed the following year. Also in 1983, Cox Enterprises bought the Chandler Arizonan, followed by the acquisition of another Arizona newspaper, The Yuma Daily Sun, in 1984. Cox Communications bought another auto auction, in Houston, Texas, in 1984.

In 1985 Cox Enterprises purchased Cox Communications for $75 a share. Cox Enterprises had owned or controlled 40.2% of the communications company’s 28.2 million outstanding shares. The combined corporation became the nation’s 13th-largest media company; before the merger, Cox Communications ranked 19th and Cox Enterprises 21st.

Other 1985 events were the acquisition of a Texas newspaper, The Orange Leader, and an Orlando, Florida, TV station, WFTV; and a swap of a cable television system in Avon Park, Florida, for one owned by Storer Communications in Fortuna, California. In 1987 Cox Enterprises sold its Philadelphia radio station to Malrite Communications Group and sold its Datext unit to Lotus Development Corporation. It had established Datext, which packaged financial information on compact discs, in 1984. It also sold CyberTel to a St. Louis investor.

At the end of 1987 the company had another change in top leadership, as Garner Anthony stepped down from the post of chairman and chief executive officer of Cox Enterprises and was succeeded by his stepson, James C. Kennedy. In 1991, sisters Barbara Cox Anthony and Anne Cox Chambers remained active in the company, chairing the Dayton and Atlanta newspapers, respectively.

By 1988 Cox Enterprise#x0027;s Miami News, like many afternoon newspapers, was suffering declining readership and advertising. Cox sought a buyer for the paper; there were discussions with a group of Chicago investors. A sale, however, could not be worked out, and Cox closed the paper at year-end. In 1989 Cox sold its St. Louis TV station to Better Communications, but expanded in other areas. It acquired an equity stake in Blockbuster Entertainment Corporation and became a franchisee of Blockbuster Video stores. Other acquisitions were Trader Publications, a publisher of advertising-only magazines; The Clipper, Inc., a publisher of coupon magazines; The Stuffit Company, a direct mailer of coupons and custom mailings; Main Street Advertising USA, a direct mail advertising company; Cox In-Store Advertising, formerly Buckler Broadcast Group, a point-of-purchase advertising business; and an interest in IP Services, Inc., a software company. It also entered into a joint venture with Picture Classified Network (PCN) to expand coverage and distribution of PCN’s Gold Book automobile price guide.

Cox sold two of its Texas newspapers, the Port Arthur News and Orange Leader, to American Publishing Company in 1990; Cox officials said they wanted to concentrate on the company’s other Texas papers. The same year, Cox acquired two radio stations, WSUN-[AM] of Tampa, Florida, and KKWM-[FM], now KLRX-[FM] of Dallas.

In March 1991 the Justice Department sued Cox Enterprises for $3.67 million for failing, in 1986, to seek federal approval before buying a $101 million stake in Knight-Ridder, another communications company. The Justice Department asserted that Cox violated a law requiring individuals and groups to seek federal approval before buying large amounts of stock in another company. A lawyer for Cox Enterprises stated that Cox believed its purchase was not subject to the law because the shares were bought for investment purposes. Also in March, GE auto auctions combined with Cox’s Manheim auctions, adding 20 auctions to Manheim’s 26; the venture also includes Ford Motor Credit Company.

In April 1991 Trader Publications was merged with Landmark Target Media of Norfolk, Virginia, and Cox held 50% of the resulting company. In May the company announced it would sell its Blockbuster stores.

Principal Subsidiaries

Trader Publications, Inc.; Stuffit Company; The Clipper, Inc.; Palm Beach Newspapers, Inc.; Cox Arizona Publications, Inc.; Cox Home Video, Inc.; TeleRep, Inc.; Southeast Paper Manufacturing Company (33.3%); Hualalai Land Corporation; Nine Bar Ranch Texas, Inc.; Clarendon Farms, Inc.