Barry Diller, once a big wheel in Hollywood, was one of the first businessmen to figure out that this would be the wave of the future. He started a company now called InterActiveCorp or IAC. Though you may not recognize the name, Fortune Magazine recently named IAC America's most admired company in Internet services, ahead of eBay, Amazon, Yahoo, and even Google.
And you've certainly heard of some of the company's brands, like Ticketmaster or the dating service Match.com. As correspondent Lesley Stahl reports, IAC is an Internet giant that Diller sewed together, piece by piece.
Diller has for years had a reputation as a business visionary from his success in Hollywood when he ran Paramount Pictures and then created the Fox television network. He's now in his third act, as his own boss. This time the vision was that a TV screen could do a lot more than entertain us. It all started 15 years ago when he looked into the future.
The year was 1992 and Barry Diller, who had turned 50, was wandering around the country in search of a new idea. He had just done the unheard of: leaving one of the top jobs in Hollywood, running the Fox studios. "I thought, this is the dumbest thing I've ever done in my life," Diller remembers.
Asked if it was dumb or scary, he admits, "Oh, [I was] totally scared. It was like 'What the hell am I going to do?' 'Cause I didn't have an idea in my head."
His companion on the journey was his best friend and now wife Diane von Furstenberg, the fashion designer. They were two vagabond millionaires. "We didn't know what we were gonna do," von Furstenberg recalls. "And then one day I went to visit QVC."
She was going to the home shopping cable channel in suburban Pennsylvania to sell her designs; Diller happened to tag along to the studio that day.
"And I was struck. I'd never seen a television set used that way. All I'd known from television screens is telling stories," Diller remembers. "I saw this interactivity, this primitive interactivity and this mix of computers and televisions and phones. And I thought, 'I don't know.' This seized my curiosity."
What grabbed him, what he saw – and this was well before people started going online – was a future where most shopping would be done by interacting with a screen. On the way home, they couldn't stop talking about it. "We drove and we got lost, because we were like so excited, talking about this entire new world that we had just experienced. It was incredible," von Furstenberg remembers.
"This is the first interactive thing...that he saw, and [it clicked]?" Stahl asks.
"But Barry can see something way before you can see anything," von Furstenberg explains.
Diller decided to buy QVC. The move surprised a lot of people. "They said I'd lost my mind," he remembers.
Diller had traded the glamorous life in Hollywood for running a cable channel in West Chester, Pa. For one, cold winters were a new reality for the executive. "I'd never been any place in the winter except to ski!" he says, laughing.
"And the first day he went to work there, he took the Metroliner. And he was not happy. He was not happy at all," von Furstenberg remembers with a smile. "And he called me and he said, 'What did you make me do? Why do you do that?'"
He knew his Hollywood friends thought QVC was tacky and a joke, but within days of his getting there, the company's stock shot way up.
Barry Diller made his first fortune as his own boss. But then he was beset by a string of setbacks. He got into a bidding war to buy his old work-place, Paramount, which he lost. It was embarrassing. "I didn't feel like I lost. I just felt I didn't make the last bid. Now by the way, it was stupid. I should have made the last bid. But I was very fresh to being on my own, and in the clutch I actually didn't have the guts to do it," Diller says.
"You're admitting a mistake," Stahl remarks.
"Absolutely," Diller acknowledges.
It was a mistake he learned from. But in making other deals, he ended up losing QVC. Yet his gut told him he had been right: that interactive commerce would catch on. So he turned around and bought QVC's competitor, Home Shopping Network. Then the Internet came along, and deal by deal, he assembled an interactive retail empire, IAC, buying Ticketmaster, Citysearch, Evite, Match.com, LendingTree – over 60 sites and growing.