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Appendix II. PTAT System, Inc.

Appendix II. PTAT System, Inc.

In light of the public scrutiny subjected to Orion, at a Christmas party in 1983, Jonathan Miller, a journalist of Communications Daily fame, taunted the author in his kitchen with the following: “McKnight, why don’t you drop that satellite idea—it’s just too hard! Why don’t you just go underseas with a cable. There would be no opposition.” In 1984 several seasoned veterans of the telecommunications policy game in Washington listened to Brian Hughes (also present in Jonathan’s kitchen) explain that an undersea fiber optic cable could circumvent the policy and legal thicket encountered by Orion and succeed in the private movement of telecommunications traffic to Europe. The team, led by Konnie Schaffer and Ronald Coleman, packaged, financed, designed, built, and began to install the cable stretched between New Jersey, Ireland, the UK, and France. Cable & Wireless, the British telecommunications company, volunteered to support the launch financially and delivered a cable of extraordinary quality. I was hired in 1987 to wrap the entire enterprise into a sale to an American carrier. With a seasoned veteran of the private telecommunications industry, Robert Bennis of Westinghouse, and a glib, charming, and hard-driving engineer out of MCI named Warren Liss, we embarked upon a one-year campaign that accumulated 17 written expressions of interest from Fortune 100 companies. I then approached an old colleague from my days at the FCC, Nancy Carey, who was William Esrey’s special assistant and who helped align the parties for maximum success. Nancy is the one who delivered our number 2 benefit to Mr. Esrey for his use in the staff meeting (we of course withdrew the benefit from our presentation). Mr. Esrey looked brilliant in front of the staff and suddenly it was his baby. The result was a 1988 meeting with William Burgess, Sr. VP International at Sprint, which culminated in Bill’s remark, “I wish to begin the bidding at 100% of your working assets.” Soon thereafter we closed on the sale of PTAT for $285 million cash plus all accumulated debt, 17 months before the cable was ready for service.


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