While Disney was making waves in Los Angeles, Simon was on the East Coast playing golf with Jack Welch, the head of General Electric, joined by Daenerys and several top executives from both GE and Daenerys Entertainment.
In March, after clearing the merger review, GE began implementing its merger and restructuring plan with Time Warner. Over the past three months, the two companies had largely integrated. After much negotiation, Terry Semel, former CEO of Time Warner, was appointed head of GE's media and entertainment division, overseeing assets such as Time Warner and NBC. Bob Wright, a long-time Welch loyalist and former head of NBC, was assigned as Semel's deputy.
Having experienced the internal factionalism within Time Warner, Jack Welch decisively ousted high-level managers like Gerald Levin and Robert Daly, aiming to ensure that internal power struggles wouldn't hinder GE's media division's growth.
For stable expansion, a company often needs a strong leader. Simon felt that Welch had essentially stepped into the role once held by Steve Ross, making it possible for Semel and Wright to coexist smoothly.
Welch had suggested this golf outing to strengthen ties between the two management teams.
In contrast to GE's dominance over Westinghouse in sectors like power and energy, Welch was well aware that GE's media assets couldn't compete with Daenerys Entertainment. In fact, Daenerys' current market valuation was higher than GE's entire market capitalization. Aware of Simon's interest in maintaining a balance of power between Daenerys and Time Warner, Welch actively supported this duality, even choosing Semel—who had a close relationship with Daenerys—to lead GE's media assets.
At a golf course near the affluent northern suburbs of Greenwich, everyone played while casually discussing various political and economic topics. A seasoned golf enthusiast, Welch had almost professional-level skills. Simon, on the other hand, despite his vast range of skills, found golf a weak spot. Still, no one, including Welch, Semel, or Robert Iger, made any comments about Simon's amateurish performance. Instead, they all made an effort to accommodate his novice level.
Such indulgence is rare in the world of serious golfers. In such circles, players with vastly different skill levels rarely play together, as a significant handicap difference can lead to ridicule or exclusion. People who aim to join these circles often spend heavily on lessons and dedicate hours to perfecting their game just to keep up.
In short, unless one's status is exceptionally high, others rarely make such accommodations.
As Welch watched Simon take a casual swing, resulting in the golf ball veering well off course, he smiled and walked alongside Simon, saying, "I read that 'Foreign Corrupt Practices Act' proposal you sent over recently. It's enlightening, though using this strategy too often might provoke some backlash."
Simon absentmindedly gripped his club tighter, testing its strength, and inadvertently bent the expensive titanium club. Seeing Welch's raised eyebrows, Simon merely smiled, summoned a nearby female caddy, and exchanged the club. "I'm mostly trying to convey an idea, Jack. The next few decades will be an era of rapid globalization. The global economy will be increasingly integrated, but every country will continue to have its own rules. If we want to come out on top, we need to drag our competitors into playing by our rules and leverage that advantage to defeat them."
Jack Welch considered this, then, with a self-deprecating chuckle, said, "I'm 61 now and already planning my retirement. I won't have much chance to participate in these battles down the line."
Simon shook his head. "I regret that."
Noticing Simon's tone, Welch became thoughtful and asked, "Simon, what do you think will happen to GE after I retire?"
Simon glanced at him. "Jack, do you want me to be honest?"
"Of course."
"I'm extremely, extremely pessimistic."
Hearing Simon repeat "extremely," Welch instinctively slowed down, his tone turning serious. "Why?"
"Because of what I just mentioned—globalization," Simon replied, matching his pace. "In a globalized world, many of GE's current businesses—such as power, lighting, transportation, and water services—will inevitably be replaced by companies from Asia, Latin America, and Eastern Europe, where costs are lower. Ultimately, GE will retain only a few cutting-edge sectors, like aviation and nuclear power. Oh, and media, as the federal government's cultural sector is quite robust and, if managed well, will remain relevant indefinitely."
Jack Welch stopped in his tracks, his pause catching the attention of Robert Iger and others in the distance, who assumed there might be an issue. But since neither Welch nor Simon signaled for them, they tactfully stayed away.
After some thought, Welch said, "Simon, I think you're overstating things. The global economy already has globalized traits, yet GE has maintained its strength."
Simon, not particularly interested in golf, pointed to the course's edge. "Jack, how about we take a break?"
Welch, eager for an answer, agreed, and they summoned a golf cart. Soon, they arrived at a clubhouse outside the course and sat down in a café. After the waiter brought coffee and dessert, Simon continued, "Globalization is only part of it. Another issue is your successor. Jack, no matter how carefully you select your replacement, I can confidently say this: they won't have the same authority or command over GE as you do now. This lack of control will inevitably lead to external influences on GE's operations."
"External influences?"
Simon gestured toward himself. "Like me."
Welch's expression shifted with a hint of wariness. "Simon, what are you planning?"
Simon chuckled. "Jack, I'm also a GE shareholder. You should trust that my interests align with GE's."
Welch's expression remained guarded.
Simon shrugged. "Fine. The third reason, beyond globalization and a weaker successor, is that federal financial capital is gaining dominance. Meanwhile, industrial capital has been steadily declining for decades due to this country's increasing deindustrialization. With your command, Jack, GE has stayed on course. But once you're gone, financial capital will swiftly become a driving force behind GE's growth. Look at what Wall Street has been doing since the 1980s, and you'll understand. AT&T is a perfect example."
Since AT&T's breakup in the 1980s, it has been continually stripped of assets. The underlying reason is Wall Street's financial influence, where, through constant divestment and restructuring, capital interests extract as much short-term profit as possible. Even Simon had his eye on some of AT&T's businesses, waiting for the right time to act.
Whether such actions would harm AT&T's foundation or impact its long-term development was irrelevant.
The fate awaiting GE after Welch's departure was much the same.
Under Welch's leadership, GE had grown into a vast empire. Yet, after his retirement, GE faced a decade of divestments that ultimately left its market value at less than one-tenth of its peak.
Welch's face showed a mix of emotions after hearing this. His sharp mind quickly grasped the harsh truth Simon had laid out, seeing it as an inevitable industry trend. Feeling a sense of resignation, he still asked, "Simon, why are you telling me this?"
Simon took a sip of his coffee, leaned back, and said, "Consider it a reflection, Jack. There's no need for disappointment; everything has a natural life cycle—birth, growth, prosperity, decline, and end. From my vantage point, I can't help but see these patterns and realize that there's very little we can truly change."
Welch studied the young man before him and, smiling, said, "Simon, I didn't expect your outlook to be older than mine."
"If you'd lived for hundreds of years, experiencing countless lifetimes, you'd feel the same."
Welch chuckled. "That's a joke, right? Everyone's intrigued by you, myself included. But Simon, I believe you're a marvel, not a miracle."
Simon just smiled.
After a moment, Welch put down his coffee cup and, with a visible hesitation, asked, "Simon, are you planning to control GE in the future?"
Simon didn't deny it. "Why do you say that?"
"Your intentions are too clear. I've noticed the recent companies you've set up: FusionTimes, SolarCity, and SpaceX. Nuclear, solar, and aerospace. GE has deep roots in each of these areas and could greatly assist these ventures. You act like you don't care, but I can tell you want to change things, and to do that, the more resources, the better. You're also right that no one after me will have my influence at GE. And, most importantly, you're young."
Sensing Welch's piercing gaze, Simon kept his smile, then gave a slight nod.
Relaxing into his chair, Welch thought it over and then looked at Simon intently. "Simon, I'll think about this seriously."
"I look forward to your decision."
With that, they moved on. Welch changed topics, bringing up the ongoing negotiations between the DC movie team and Batman actor Adam Baldwin. "Simon, I think Baldwin's asking price—$15 million as a base salary and 10% of global box office gross—isn't unreasonable. Don't you agree?"
Negotiations with Baldwin, who played Batman, had been circulating in Hollywood for some time, with both sides seemingly interested. Unlike Brad Pitt, who was cast as the lead in Face/Off, Baldwin had struggled outside the Batman role, and as Daenerys Entertainment continued to soar, Baldwin saw an opportunity to secure a larger stake in the Batman franchise.
The standard top-level salary had been effectively capped at $15 million by Simon's influence in recent years. The sticking point
was Baldwin's insistence on a share of global box office profits, not just domestic.
That Welch would personally raise this matter surprised Simon—but it also made sense.
A visionary for company strategy, Welch often engaged in hands-on management.
In fact, he had personally negotiated with Seinfeld star Jerry Seinfeld, eventually securing a final season for $100 million, resulting in a legendary finale with 75 million viewers.
Since Welch had raised the matter, Simon replied, "I agree that the price is fair. The current issue is the number of films. We'd like to sign Baldwin for three more films, ensuring continuity through Justice League 2, while his team wants a one-film deal. I want to avoid that uncertainty."
Assuming future DC films grossed $1 billion globally, the studio could expect roughly $400 million from ticket sales. With an estimated production and marketing budget of $200 million, a 10% profit share would mean $20 million for Baldwin, or $35 million total for the film's star.
Welch, seeing Simon's stance was less about price and more about contract length, acknowledged the logic and let it rest. He, too, understood that long-term agreements were essential for the DC Universe's continuity.
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