Kluge ranks as one of the least known but most powerful moguls in
the modern television industry in the United States. The major television
networks and their affiliates deservedly draw the most attention,
but Kluge proved a group of independent TV stations could make millions
of dollars. His Metromedia, Inc. pioneered independent stations
operations through the 1960s and 1970s. In the mid-1980s Rupert
Murdoch offered Kluge nearly $2 billion for the Metromedia stations,
which then served as the basis for Murdoch's FOX television network.
This deal made Kluge one the richest persons in the United States.
was the food business that led Kluge to television. In 1951 he invested
in a Baltimore, Maryland food brokerage enterprise, increased sales
dramatically, sold his majority stake in the mid-1950s, and began
to look for another industry that was growing. He found television.
In 1956 Kluge was too late to enter network television, but saw
possibilities with independent TV stations. He assembled an investment
group and purchased the former DuMont stations. He ran Metromedia
on a tight budget, saving rent, for example, by headquartering the
company across the Hudson River from new York City, in Secaucus,
New Jersey. He seized upon the programming strategy of simply re-running
old network situation comedies and low budget movies. And Metromedia
made millions with relatively small audiences, because costs of
operation were so low.
his stewardship, Metromedia grew into the largest independent television
business in the United States. Thereafter Kluge purchased assorted
businesses to add to his Metromedia empire. Over the years he acquired
the Ice Capades, the Harlem Globetrotters, music publishing companies
holding such titles as Fiddler on the Roof, Zorba the Greek,
and Cabaret, television production and syndication units,
Playbill magazine, and a highly profitable direct mail advertising
division. But he did make mistakes. One disastrous misstep was Kluge's
1960s purchase of the niche magazine Diplomat; another came
with his proposal for a fourth TV network. Neither project succeeded,
and the failures cost Metromedia millions of dollars.
reached his greatest successes in television by buying the syndication
rights to M*A*S*H. With this asset he finally gave rival
network affiliates a contest for ratings in the early fringe time
period. Not one to sit still, during the early 1980s Kluge cooked
up a deal to take Metromedia private. In 1984, by structuring a
$1.3 billion leveraged buyout on unusually favorable terms, Kluge
ended owning three-quarters of the new company and pocketing $115
million in cash in the process. Now private and in full control,
Kluge did not hesitate when Rupert Murdoch approached him with $2
billion to buy Metromedia's television stations.
of TV, Kluge attended to his other businesses. Under the Metromedia
name, he began to manufacture paging devices and mobile telephones.
In managing these telecommunication ventures, Kluge retraced the
steps he took in his television career: buy a license in a major
market at an affordable price, then wait as the market evolves,
and finally cash in.
In 1995 the Actava Group Inc., Orion Pictures Corp., MCEG Sterling
Inc. and Metromedia International Telecommunications Inc. signed
an agreement to form a global communications entity to be named
Metromedia International Group Inc. Kluge already owned a major
stake in Hollywood's Orion Pictures. The new four part alliance
merged wireless cable and Hollywood production skills to sell all
forms of mass communication to citizens in Eastern Europe and the
former Soviet Republics.
and selling has benefited Kluge enormously. His wealth, which Forbes
estimated at $5 billion as of the mid-1990s, vaulted him onto the
list of the richest persons in the United States. Kluge spent his
wealth so he could live like a king in a 250-room Georgian mansion,
Albemarle, situated on 10,000 acres in rural Virginia, near Charlottesville.
He hosted frequent shoots for his guests, handing out antique guns
to aim at birds released by a large staff of British-born retainers.
In 1988 neighbors began pressing charges when their household pets
turned up dead; local wildlife officials successfully prosecuted
Kluge's staff for slaughtering hawks, a protected species.
sum John Kluge represents the TV entrepreneur in the true sense
of the word. David Sarnoff and William Paley, more publicized figures
who started networks, have long been the subject of major biographies
and much research. Kluge, perhaps because his efforts have been
directed toward a less glamorous side of the television industry,
has not been studied. But as a pioneer in independent television
station ownership and operation, he deserves the same degree of
(WERNER) KLUGE. Born in Chemnitz, Germany, 21 September 1914.
Attended Wayne State University, Detroit, Michigan; B.A. in economics,
Columbia University, 1937. Married: 1) Theodora Thomson, 1946 (divorced);
2) Yolanda Zucco, 1969 (divorced); children: Samantha and Joseph;
3) Patricia Rose Gay, 1981 (divorced, 1990); child: John W. Kluge
II. Served in U.S. Army intelligence, 1941-45. Immigrated to U.S.,
1922; worked assembly line at Ford Motor Company; vice-president
and sales manager, Otten Brothers, 1937-41; bought radio station
WGAY, Silver Spring, Maryland, 1946; president and director of WGAY,
1946-59; president of New England Fritos, 1947-55; president, Mid-Florida
Radio Corporation, Orlando, Florida, 1952-59; president and director,
St. Louis Broadcasting Corporation, 1953-58; president, New York
Institute of Dietetics, 1953-60; president and director, the Pittsburgh
Broadcasting Company, 1954-59; president, treasurer and director,
Capitol Broadcasting Company, Nashville, Tennessee, 1954-59; partner
in Nashton Properties, Nashville, Tennessee, 1954-60; owner, Kluge
Investment Company, Washington, D.C., 1956-60; president and director,
Washington Planagraph Co., 1956-60; founder, with David Finkelstein,
wholesale food operation Kluge, Finkelstein and Company, Baltimore,
1956; partner in Texworth Investment Company, Fort Worth, Texas,
1957-60; president, treasurer and director, Associated Broadcasters,
Inc., Ft. Worth-Dallas, 1957-59; chair of the board, Seaboard Service
Systems, Inc., 1957-58; treasurer and director of television operation,
Mid-Florida Radio Corporation, 1957-60; partner in Western New York
Broadcasting Company, Buffalo, New York, 1957-60; president, Washington
Food Brokers Association, 1958; president, Metropolitan Broadcasting
Co. (MPC; became Metromedia, Inc., 1961; then Metromedia Company,
1980s), 1959; bought World Wide Broadcasting (WWB), 1960, sold WWB,
1962; vice-president, later president and chair of the executive
committee of the United Cerebral Palsy (UCP) Research and Educational
Foundation from 1972; Metromedia, Inc. changed to Metromedia Company,
1980s; purchased Texas-based LDS, 1983; bought Florida-based Network
1, 1984; purchased all outstanding shares (72%) of Metromedia Company,
becoming sole owner, 1984; sold off most Metromedia assets, 1984-92;
became 69% owner Orion Pictures, 1988; merged Metromedia Long Distance
with long-distance divisions of International Telephone and Telegraph
(ITT), forming Metromedia-ITT, 1989; merged Metromedia-ITT with
Resurgens Communications Group and LDDS Communications to form LDDS
Metromedia Communications, 1993. Chair of the board, treasurer,
director of Kluge, Finkelstein & Company since 1963; chair of the
board and treasurer Tri-Suburban Broadcasting Corporation and Washington,
Kluge and Company; chair of the board, president, and treasurer
Washington, Silver City Sales Co.; director, Marriott-Hot Shoppes,
Inc., Chock Full O' Nuts Corporation, National Bank of Maryland,
Waldorf Astoria Corporation, Just One Break, Inc., Belding Heminway
Co., Inc.; board of directors, Bear Stearns Companies, Inc., the
Schubert Foundation, Occidental Petroleum Corporation, LDDS Metromedia,
and national advisory board of the Chemical Banking Corporation;
trustee, Strang Cancer Prevention Center; chair, James Madison National
Council of the Library of Congress. Member: advisory council Manufacturers
Hanover Trust Company; board of governors, New York College of Osteopathic
Medicine; National Association of Radio and Television Broadcasters.
Address: Metromedia Company, 1 Meadowlands Plaza, East Rutherford,
New Jersey 07073, U.S.A.
Photo courtesy of Broadcasting and Cable
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15 August 1995.
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Justin. "College Boosters." Fortune (Chicago), 17 May 1993.
Julie L. "Metromedia's Kluge Gives Columbia $60-million for Minority
Scholarships." Chronicle of Higher Education (Washington,
D.C.), 28 April 1993.
Martin. "Metromedia Signs Off on Goldwyn Buy." Variety (Los
Angeles), 5 February 1996.
Donna. "Orion the Nucleus of New Kluge Venture: Metromedia International
Group will Use Film Library to Become Global Media Concern." Broadcasting
& Cable (Washington, D.C.), 5 September 1994.
Joseph. "The Millstones at Metromedia: What's Holding Back the Building
of a New Long Distance Empire." Business Week (New York),
1 March 1993.