Just Call Him STEVE

When the staid old-school directors of Time Inc. signed on with Warner baron Steve Ross as their new chairman, blue chip met poker chip in the media merger of the century. But did they really know whom they were getting? In an excerpt from To the End of Time, RICHARD M. CLURMAN reports on the controversial rise of the former funeral-home executive who became Bill Paley's son-in-law and the highest-paid C.E.O. of a public company in America

RICHARD M.CLURMAN

ACIRCUS MAXIMUS, one headline writer called it. Variety, the slangy bible of show biz, screamed, "NO BIGNESS LIKE SHOW BIGNESS. Ego, hostility, greed, fear and power-lust: Suddenly, [the] war over the singular prize of Time Inc. has all the elements of a silver screen epic."

Robert Lenzner, the experienced and usually restrained financial reporter, wrote that it was "the greatest spectacle in the history of the takeover game. The epic proportions of the drama attracted Wall Street's investment bankers sweeping the world for bidders and big bucks, while the legal eagles invent new offensive and defensive strategies." USA Today weighed in with "Henry Luce wouldn't be very happy. Time Inc., Luce's beloved empire, is on the block like a side of beef." On the CBS Evening News, the sums of money involved were described as just about equaling "the total U.S. foreign-aid program in 1989."

What was all the shouting about? Only the creation of the biggest media empire ever, the corporate interfaith marriage of sixty-seven-year-old Time Inc., a Waspy, blue-chip American institution, for years the largest combined maga-

zine and book publisher on earth, to Steven J. Ross's pokerchip Warner Communications Inc., the swinging pop-entertainment conglomerate, whose movies and sounds of music ricochet around the world.

Wamer and Time were as different from each other—in their people and their products—as the scrappy old Brooklyn Dodgers and the haughty old New York Yankees. Different leagues, different managers, different fans—same hometown.

Ross and many of his cohorts had risen impressively from the mean streets of New York, arriving from all over the career map at what became Warner Communications. Most of the Time crowd had different histories. Their early playing fields were often the campuses of the Ivy League, then up the ladder, rung by rung, on the tidy organization chart of Time Inc. When the two companies and two cultures came together, some considered it a metaphor for the American Dream of cultural pluralism annealed in the corporate melting pot.

What was really notable about the marriage was that Time's executives and twelve outside directors, who were so full of doubts about Ross when they got engaged, still knew little about him when they wed. None had known him except distantly. Of the dozen outside Time directors who agreed to make Ross their new chairman and co-C.E.O., only one on the combined Time Warner board had ever taken the trouble to meet with him (at one dinner) before the final deal was completed. But for that single encounter, the outside directors of Time Inc. chose Ross to be their chairman and leader for the next ten years, and co-C.E.O. for at least five, without ever talking to him first.

The three Time executives who negotiated the deal (chairman J. Richard Munro, president Nicholas J. Nicholas, and vice-chairman Gerald M. Levin—pronounced like "begin") spent hours with him, but they knew Ross only in the most superficial way. They had volumes of numbers and analysis on the deal itself, but only the sketchiest knowledge of Ross. What they knew of his personality, strengths, and weaknesses they gleaned from his wooing ways in face-to-face observation. They never informed themselves by seriously seeking the scores of people—many unabashed admirers—who could have filled out the picture of the man whom they agreed to take in as their seniormost partner.

It's not as if Ross had led a quiet, uneventful life. But they never inquired, for example, into S.E.C. files concerning the collapse of Atari, Warner's most profitable division in the early eighties, and the insider trading in Warner stock that occurred right before its downfall. They had only the dimmest knowledge of his fierce battles with media baron Rupert Murdoch or investor Herbert J. Siegel. Nor did they know anything of the quick departure of every one of Ross's top executives. Or the criminal scandal and convictions surrounding gangland's Westchester Theatre, in which Warner was involved. Ross was listed as a "co-conspirator," but availed himself of his Fifth Amendment rights so that he would not have to testify before the grand jury. All the Time people knew was that he was never indicted and that the criminal investigation of him was finally dropped.

Had they inquired about the affair, the information they could have unearthed about Ross was not faded old stuff. It had been collected afresh after an eight-year-long investigation commissioned by Warner's own board and reported in a secret 663-page document in May 1986—one year before the Time Warner merger talks began. Known as "the Armstrong Report," it concerned the criminal fraud for which one Warner consultant had gone to jail; Ross's top lieutenant and closest friend had admitted guilt; and Warner's assistant treasurer, who handled Ross's personal accounts, had been convicted of fraud, racketeering, and perjury. The report, which seriously questioned Ross's "credibility," could have been made available to Time by just asking Warner for it.

Key Time executives and board members say they didn't ask, because it might have been "embarrassing" to Ross. "Steve is such a sensitive soul," one of them explained, and another added that it might have "killed the deal."

Had the Time executives and outside directors asked and found out these and other easily obtainable facts and insights about Ross and the history of his management, maybe it wouldn't have mattered to them. Nor might it have made any difference to know that Ross's recollections of his World War II service, college degree, pro-football experiences, and other milestones in his autobiography were the products of his own imagination. Perhaps it would have seemed irrelevant. They liked and admired Ross and his company for other reasons. Ask Ross what the most important thing to know about him is and he responds proudly with a homily that he repeatedly expressed to the Time executives: ' 'More important than anything else is that my word is my bond."

Many a biographer and journalist has made the mistake of recording flaws and foibles of a subject without taking the measure of his accomplishments. Ross's life is the stuff of a Warner Bros, melodrama: a lead character of undeniable talents rising from a sports-slacks salesman and funeral greeter to become a pop-entertainment Medici. Then he became the leader of the most visible media conglomerate in the world.

But a writer or reporter from any one of Time's magazines would have been severely chastised or fired for turning in even a short profile of Ross based on the scant insight and information Time's board and top executives had before the merger. Ross says he was willing, even eager, to meet with the Time directors, but they never asked him. The answers to their initial doubts and questions would have been readily available to them. Had they seriously inquired, they might have been surprised.

Across Sixth Avenue, down the street from the Time & Life Building, past granite walls, manicured flower beds, and roaring fountains, stands the Warner Communications Building, at 75 Rockefeller Plaza, in the older part of the complex. No one spoke aloud of succession there, unlike at Time, where the topic of who would succeed whom provided never-ending collegial anguish. At Warner, Steven J. Ross was in charge.

By the late seventies, Ross had built the company in less than twenty years from a mixed—and mixed-up—collection of ventures into an international leader in movies, records, popular publishing, and cable. When he started out, Ross knew more about the opportunities on the streets of New York than Broadway or Hollywood Boulevard. As important to his success as his intricate deal-making talent was his beguiling "charm." That was the word everyone used to describe him. A weekend neighbor and friend, Steven Spielberg, made a picturesque comparison from his landmark movie. "I think of Steve as a six-foot-three-inch E.T."

At Warner, "Ross" and "boss" more than rhymed. No one ever disputed that. Warner without Ross was almost unthinkable to his chorus of well-paid operating managers and aides. Nor did they hint in his presence that they wanted it any other way. After noisy disagreements and four-letterword clashes, salted with Yiddish argot, they would recite in public the company's anthem: "We love Steve Ross"— "love" was always the verb—"he's like a father to us."

At Time Inc. in those days, love on the premises was more often the high-tension emotion of interoffice affairs than a term of endearment for bosses. But Ross was different. Deals and endearment were his lifelong game. He was a hugger, a kisser (of men and women), a wooer. "Heartfelt" is his favorite adjective for toasts. His largess of spirit and pocketbook for the chosen knew few bounds. Ross had a mission, different from but as driving as anyone's at Time. He wanted—needed—to be loved, successful, and, by all kinds of benefactions, large and small, to hold sway over those around him. "Steve was a charming host, a slightly uncomfortable guest," one of his now departed office claque says.

The Time executives who negotiated the deal had only the sketchiest knowledge of Ross.

He was truly known only to his family and the executives who worked with him closely, some from the beginning. Their feelings and views were refracted through a prism of affection, awe, and suspicion. To discuss their insights outside their circle was considered an act of disloyalty, a risk few would take. Most who really know him speak candidly about Ross only behind a shield of anonymity. "We all sort of plead the Fifth Amendment when you ask us about Steve," says one of them.

"No one from Warner," says the company's accomplished music impresario, Ahmet Ertegun, who heads the Atlantic Records Group, "will say anything to outsiders that's critical of Steve. He takes such good care of everybody. ' ' Ertegun, for example, says, "I would never leave Steve. Everybody has always offered me big deals. Now I just go in to Steve when my contract is up and say,

'Here's what my lawyer says I should ask you for.

But I'm telling you if you don't give it to me I'm staying anyway.' "

Another Ross intimate, who has watched him admiringly at every phase of his life, says of him,

"Steve got his training in business from working for his father-in-law at funeral parlors, where he met you on the worst day of your life. The day when your parents or your children or your loved ones dropped dead.

He was there to make you feel good. And he learned how to do that better than anyone in the world because he had the best training in the world. He took that ability into show business and made it work better than anyone I've ever seen in my entire life. He would carry your bags, light your cigarettes, open the door, smother you with gifts, let you use the company's airplanes, overtip all the time, listen to your life story no matter how bored he was, without telling you anything about himself. You need a word beyond just 'obsequious' to describe him."

David Geffen, the precocious and stormy entertainment whiz who defected from Warner in 1991 and made close to a billion dollars after selling his company to competing MCA, had worked under Ross for twenty-three years. Geffen once said to him in the midst of one of their many disputes, "Steve, do not light my cigarette. It's costing me too much."

hen Ross started to collect the companies that became Warner Communications, they were a motley lot that defied definition.

His company developed from his father-in-law's Riverside funeral parlor ("expanded service with traditional dignity") and limousines into the Kinney Service Corporation, named after Kinney Street, around the corner from its first Newark

office. Kinney's divisions and subsidiaries came and went almost as fast as cars in its parking lots.

Its bosses referred irreverently to the funeral part of their business as "our permanent-parking division." But Kinney's central engine was an array of stock swaps, acquisitions, successes, failures, spin-offs, warrants, mergers, buyouts, tax write-offs, trades, or whatever deal device was handy, inching by chance toward coherence. "There were few conventional acquisitions," one of Ross's marveling lawyers remembers. "There's almost no deal we did that we weren't creating new tax laws. It was heady stuff."

After the funeral parlors and limousines came car rentals; parking lots; hotel-, hospital-, and office-cleaning companies (including a contract to tidy up Rockefeller Center—RCA's David Samoff was the uncle of one of Ross's early executives); printing; drywall partitions; real estate; security guards; painting and plumbing contracting; window washing; comic books {Superman, Batman, Wonder Woman); Mad magazine; licensing (cartoon characters and sports memorabilia); movie cameras (Panavision); newsstand periodical distribution; a New Jersey bank; paperback books; data processing. Close to 160 Kinney-whatever units in the conglomerate. Kinney called itself "the Servicemakers—a unique one-stop shopping complex for banking, corporate, institutional and real estate communities."

The go-go 1960s found Kinney going at high speed. Ross's crazy quilt of companies was growing and prospering. But a service company—what was that? Even Wall Street couldn't figure it out. Then, in 1967, with advice from a few of his corporate friends, Ross bought a Hollywood talent agency named Ashley Famous, which had deep roots in the movie and TV business. Its boss, Ted Ashley, an able executive, pointed Ross to a decaying Hollywood movie company, WarnerSeven Arts. Its film department was ailing, but, barely visible at first to Ross, it had a successful popular-records business. Ross grabbed the package. With Ashley at its head, the company started making hit films again (Summer of '42, Klute, A Clockwork Orange, Dirty Harry, The Exorcist) and restored the legendary Warner Bros. name.

In the years following, his high-rolling acquisition bent had few limits. Leisure and entertainment was a broad charter. He built Jungle Habitat, a New Jersey animal park, which was a disaster. That "dispelled forever," remembers one of Ross's sharp-tongued former cronies, "the popular illusion that lions eat only Christians." Ross collected Knickerbocker Toys, a major interest in the Pittsburgh Pirates, Malibu Grand Prix (auto racetracks), Ralph Lauren perfume and cosmetics, and the moribund New York Cosmos soccer team, which he brought to life by paying the Brazilian soccer superstar Pele millions to join the roster. He tried two-way pay-TV in Columbus, Ohio (QUBE), MTV, Nickelodeon, the new Atari video games. All are gone from Warner's group now, all but one—its cable-TV franchises.

Ross was acclaimed for his daring and generosity. To oblige itinerant visitors and executives, he later bought five Trump Tower apartments, an air force of planes and helicopters, and the Villa Eden in Acapulco, a memorable full-service retreat perched high on a hill overlooking the resort's harbor. In Ross's New York office, the conference table for the executive suite was so big and shiny that one of his top managers closed a meeting with the wisecrack "We've got to clear out of here by noon so the Rangers can use the table for hockey practice." Ross was hanging out with Frank Sinatra, Barbra Streisand, Spielberg, and Clint Eastwood. His business was booming. He was a hero to Wall Street and his stockholders. He was courting presidents of the United States and a governor of New York.

Little did he or anyone else know he was on the edge of becoming the leading character in a drama that would have taxed Hollywood's most mournful tragedian.

Time's leadership-succession process was as judicious and balanced as a 5-4 Supreme Court decision. Steve Ross's history during the same period in the late seventies and early eighties reads more like a Greek tragedy. Ross had a series of disasters. Only the first involved his succession.

Under chairman Ross, Warner never had a chief operating officer. "I'm not a manager," Ross says. "I'm more of a dreamer." His management style, explains someone who has experienced it, "is not hands-off. That's misleading. He inspires rather than runs or curtails. He's in many ways a Jewish mother. Some people appear to be generous. He really is. "

But he couldn't face elevating one of his four top headquarters executives at the risk of losing the affection of the others. Below his sovereign throne he also resisted bureaucratic layers of command. To fudge both problems, Ross set up a four-man Office of the President (there was no president), all four vying for his attention. "They were not the best people in the world," says an ex-Warner executive who knew them all, "but they were devoted to Steve, as I still am. Steve always picked people who were completely within his control." Each of the four was in charge of overseeing financially the impresarios who ran Warner's creative and other divisions. Within a few years, in a series of personal and corporate thunderclaps, all four would be gone, none retired.

While they were still there, it was a dazzling life. "So overwhelming," one of them remembers. "When I left the office to go on a trip to the Coast, my driver didn't take me to LaGuardia, which is fifteen minutes away. He took me to the helicopter so I shouldn't have to—God forbid— get in some traffic. The helicopter would take me right onto the field where the plane was, a steward and all those things waiting. So you go on your own plane and you are picked up by a limo at the other end, driven to the Beverly Hills Hotel, and you get into Bungalow 10, with four bedrooms, where you're alone or with two other people. Then you walk into a movie studio where you're kind of a king. And you're telling me our life didn't change—these little guys from Manhattan, Brooklyn, and the Bronx!"

The youngest and newest arrival to the quartet was thirtyfive-year-old Ken Rosen, handsome and dark-haired, whose father had wrenched himself from Manhattan's Lower East Side ghetto to become a modestly successful lawyer and a politically connected administrative judge. Rosen was a fastmoving deal-maker. "Around Steve he was deferential and always looking for direction," says a contemporary. "With others, he was developing into a sort of Steve Ross Jr."

He came to Ross's attention early, as an acquisitions specialist in the Ashley Famous Artists deal. Ross kept his eye on Rosen as he cut a small swath through the financial side of entertainment investments. When Ross brought him to Warner, it was to do mergers and acquisitions. He quickly became Ross's constant companion and protege, "the younger brother Steve didn't have," says one friend. Carmen Ferragano, Ross's longtime assistant, told a reporter that "Kenny absolutely worshiped Steve, and I think Steve was receptive to being worshiped." Rosen's executive companions in the new Office of the President were drawn to the apparent crown prince but jealous of his close relationship with Ross.

"Kenny helped us all," one of them says. "Under Steve's wing, he showed us how to live." Soon they all had extravagant contracts with a rondo of short-term and long-term bonuses, incentive stock plans, and severance insurance that would convert the pain of leaving into an enriching experience. These were not just severance packages, recalls another of the four, "they were more like suitcases or steamer trunks." One of their compensation consultants, who fled in dismay, describes the executiveenrichment process with all its new gimmicks as "lowering the top of the tennis net from its regulation height to two inches from the ground."

Ross remembers the period with melancholia. "I started to groom Ken Rosen to be the president. I had no real replacement. In 1976 I negotiated four contracts with the men in the Office of the President. Ken was fifteen years younger than the other three. This is the scary part of it. He was the only one—they all got the same contract—who wanted a clause for disability. That was in November. The contract started January 1, 1977."

Three months later, on Sunday, April 3, Rosen was riding the Central Park bridle paths.

His horse suddenly bolted and Rosen plunged headfirst into a tree. He was near death, in a coma for months. Ross rarely left Rosen's bedside. "Steve would actually shake him out of his semi-consciousness," one friend remembers. "Steve talked him alive" was the sentimental consensus. A Ross business confidant told a reporter, "Steve loved Kenny and I also think he's addicted to helping people. He relaxes from his own problems by helping others, and he gets satisfaction from being needed."

Today, Rosen, fifty, lives in Innisfree Village, a familystyle collection of cottages for the mentally handicapped, seventeen miles outside Charlottesville, Virginia, nestled in the foothills of the Blue Ridge Mountains.

At Time Inc., the generation of new managers in the eighties had never really known their company's founder, Henry R. Luce. At Warner, even though Ross owned less than 1 percent of its stock, the company was dominated by his personality and the roller coaster of his life. Like every other Warner trip, the company's odyssey through the seventies and eighties was as much personal as it was corporate. It is impossible to know Warner—past or present—without knowing Steve Ross in a more personal way than chronicles of business usually demand.

"Why," wonders a member of his family, "is it that Steve is the only mogul uncomfortable on the top of his mountain?" To most casual observers of Ross in action, he is an exemplar of self-assurance, charm, command, with the grace of a man in possession of his success, abundantly offering his own blanket of security to those around him. One longtime intimate explains, "Steve gets loyalty. The people who work for him swear by him and they'll jump off mountains in order to please Steve Ross because he makes damn sure they get rewarded for what they do." One of his former executives explains the jump in a different way. "His relationships with people are a combination of incredible sincerity and total insincerity. If Steve told me to go jump out the window, I would, not because I'd do whatever Steve told me, but because I'd know there would be

a safety net two floors below."

Yet there is another Steve Ross—as there is another everybody. Ross himself is enclosed in a protective wall by his staff. He is a master of sizzle and ballyhoo, yet his Warner operation has been a fortress of silence and secrecy. "We do a terrible job P.R.-wise," says Ross. "Primarily I'm the reason. I don't give interviews. Newspapers get angry. Magazines get angry. So finally I give an interview and we make a hundred more enemies. " (He was interviewed extensively for this report.)

When a reporter recently and routinely asked for Ross's prepared bio (every C.E.O. has one), he was told, "We're working on it." Eight weeks later it arrived in its latest version, without a word about the man himself, only about his company. The lead sentence said, "It is almost impossible to separate the 20-year history of Warner Communications Inc. from the business career of Steven J. Ross."

"I think everybody is afraid of being found out," says one longtime Ross admirer, "except those people who finally decide that they are who they invented themselves to be. Steve is extraordinary at those things he's good at—making you want to be his friend, his ability to work financial magic, making you feel that you have a privileged and a special relationship with him. Actually, there's no such thing as being close to Steve, because nobody's really close. On some level he's a visionary. But it's odd. He obviously doesn't think very highly of himself. You can see it in the way he behaves, he holds himself, the way he constantly services people."

Ross tells his own life story earnestly, with the belief and conviction reinforced by repetition. Separating the facts from the fiction requires more excavating than merely asking. Even more than with most fabulists who star in their own imaginative scripts, Ross appears to believe the stories he tells about his own life. He seems to embrace whatever tales he once told no matter how incorrect they are.

The Flatbush section of Brooklyn, where Steve Ross was born on September 19, 1927, was populated largely by Jewish immigrant families, most living on marginal incomes in solid two-story row houses, a neighborhood where young boys played stickand stoopball on tree-lined streets. They were characterized in The New Crowd, a lively account of the roots of Jewish success in America, as "the first-born sons of middle-income or working-class families headed by a self-employed father. They were expected to do far better than their parents, most of whom were immigrants or the children of immigrants—many from Eastern Europe.''

Young Steve fit the specs perfectly. His father, the son of Russian and Alsatian immigrants, at first earned a good living in the homebuilding business. When the 1929 stock-market crash and the Depression hit, Ross's family was left penniless. They moved from their house on Carroll Street to a small apartment building on Newkirk Avenue, surrounded by brownstones. In 1932, when young Steve was in kindergarten, his father changed the family name from Rechnitz to Ross, in order to get a job as an oil-burner salesman. "He couldn't get a job with that name, so he changed it,'' Ross says.

"We were poor, poor,'' Ross remembers. "Sometimes we had rolls for dinner—and that was it.'' But his proud, dignified mother, he says, always insisted on having finger bowls on the table, symbolic to him of a self-esteem that she engraved on his memory. She also had strict rules about good manners. "If I ever sat down before my mother or my sister and I didn't help them by holding their chair, I didn't have that roll. My mother taught me dignity and self-respect. When you grow up in the Depression and on the streets, you always remember.''

Ross attended nearby P.S. 152, on Glenwood Road, then later Erasmus high school. (In those days New York City had the best public-school system in the U.S.) He was, even then, a mixture of shyness and overconfidence. Young Steve was well liked by teachers, who remembered his best subject was math.

After his father began to pull himself out of the hardship of the Depression years, he and his wife decided "for the children's sake'' to move to "the city,'' i.e., Manhattan, a nickel subway ride away but a big step up. With his family still unable to afford the tuition, Steve transferred, on an athletic scholarship, he says, to the predominantly Jewish Columbia Grammar School, where "you could meet new people.''

Already over six feet, Steve played varsity football, baseball, and basketball. He was elected vice president of the student council and a member of the junior-prom committee, where his flair on the dance floor made him a natural. He was co-winner in the vote for "most popular'' boy in his senior class. In the yearbook, Steve's way with the girls was attested to by a joking reference to him as "the noted bigamist.''

Ross graduated from Columbia Grammar in June 1945, three months short of the World War II draft age. He has often told friends he "lied'' about his age when he was fifteen so that he could get into

Continued on page 122 the navy. Actually, he was seventeen and eligible for the navy, so instead of waiting to be drafted, he chose his own service.

Continued from page 116

After six months of basic training in New York and Virginia, Ross boarded the U.S.S. Hopping, a destroyer escort converted into an auxiliary-personnel destroyer. "We were shallow-draft," Ross says, "so that we could get close to islands." His recollection of his wartime service is that "we carried supplies and Marines into landings in the Pacific, then the war ended. Because of having overseas duty most of my time, which was very unusual," Ross explains, "we had all these points, so I got out early." ("Points" were awarded to servicemen and women, with bonus awards for combat and overseas duty, to determine in what order they were to be discharged.)

Ross, who wears almost invisible hearing aids, attributes the need to his navy service. "I have a hearing problem," he says. "I love to have a dinner for six or eight people. That's fine. I have trouble hearing more. At cocktail parties if you're a tall person with a hearing problem you get all the background noise of a cocktail party without hearing anything. I'm about six foot three and a half. You stand there with a smile on your face hoping you're shaking your head at the right time." He says his impairment became noticeable "ten years after the war, when I was twenty-eight or twenty-nine. It was caused by the firing of guns off the ship. They didn't have the type of equipment they have now to protect you."

Ross's official service record tells an entirely different story. In fact, two weeks after Ross began active duty in the navy, and more than six months before he joined his ship, the war in the Pacific had already ended. Seaman First Class Steven Jay Ross, 7172226, spent five months of his one year and eleven days in the navy lollygagging aboard the U.S.S. Hopping. Nearly two months before Ross joined her crew, navy records say, she was in the Charleston, South Carolina, shipyard, where "ammunition was unloaded," and the ship began a "pre-inactive overhaul." She went from dry dock to an anchorage in Norfolk, Virginia, where Ross boarded. She was under way at sea with Ross aboard for only two days, heading from Norfolk to Charleston for more shipyard work, then at sea five more days to Green Cove Springs, Florida, where she was decommissioned.

The Hopping had indeed seen heavy action in both the Atlantic and Pacific. But a hyperactive Warner press agent embellished the myth even further, confusing, as Ross does, the ship with the man, when he wrote that, "during World War II, Mr. Ross saw action with the U.S. Navy in the Atlantic and Pacific theaters."

After the war, veterans were given tuition-free access to schools and colleges under the G.I. Bill of Rights. They could attend any accredited school that would admit them. But, for those like Ross who hadn't yet started college, it was hard to break through the crowd going back. A number of new schools sprang up to capitalize on the oversupply of applicants.

The headmaster at Columbia Grammar, whose advice Ross says he sought, thought he would be best served by the advantages and personal attention of a small college. Ross remembers the headmaster recommended that, "as opposed to a triple bunk bed in a gymnasium at a Duke or Wisconsin. He didn't think my education would be very good going to a class with 120 or 130 others." The academic intimacy and privacy of a small school appealed to Ross. "He told me it didn't matter, Yale, Harvard, or anything else. We were living in an unusual time and it was best to find the best professors with a small amount of people. After the war you sort of deserve a room by yourself or with only one other person."

Paul Smith's two-year junior college, on the site of an old resort hotel in the isolated north woods near Lake Placid, New York, was just such a place. No matter that it specialized in "resorts management," "hospitality," and "forestry," with a background program in liberal arts. Or that it gave only an A.A. (associate of arts) degree, upped in old Warner handouts to a B.A. (the more conventional four-year bachelor of arts).

Ross entered its first class, in 1946, surrounded by other ex-G.I.'s. When they weren't studying, they went snowshoeing, skiing, hunting, trapping, fishing, or partying on weekends in Saranac Lake. "It was fantastic," Ross says. "You could go fishing or hunting with your professors." Ross is Paul Smith's most famous graduate, remembered fondly by classmates and professors for three attributes: (1) "He was brilliant in my field of high-powered mathematics, particularly calculus," one professor recalls; (2) "Ross was one handsome dude," a classmate says, "good-looking, articulate, quiet—he stood out, young ladies paid a lot of attention to him"; (3) "Touch football was very popular and he was an addict," says another.

In the fall of 1947 the college paper reported:

Taking full advantage of Deerwood's weak line. . .the Campus Commandos scuttled the Deerwood Devils to the tune of 14 to 6. . . Saturday, November 1st. . . . [In the third quarter] Steve Ross, who had been playing a wonderful game at right end, was injured while attempting to knock down a pass. . . . During the bitterly contested battle on the gridiron ...Steve, after many brilliant receptions while playing end for the Commandos, was once more in the center of a scramble for the pigskin. When the mass of players untangled themselves he was alone on the turf with the first major injury incurred on the field of competition for Paul Smith's College. . . . Steve was admitted to the Saranac General Hospital.

The school paper reported: "Steve's left arm was badly broken below the elbow, and a steel plate was used to strengthen the joint which was torn.

. . . After a physician's consultation, it was decided that the injury was serious and the patient would have to remain there for at least three weeks."

Ross has a different recollection of his broken arm and football career, which reached its apogee playing not touch football in college but end for the professional Cleveland Browns. At one time in his life, the children's bedrooms were festooned with Cleveland Browns banners and souvenirs, supposedly a reminder of those dreamy days. He also explained to his friends and family that the metal plate in his arm came from a bone-breaking collision in a Browns play called "the cross," more often known as "the Statue of Liberty," in which a passer raises the ball, which is snatched from his cocked arm by one of his teammates. The Cleveland Browns, the local newspapers, and his putative teammates have no recollection or record of him or anyone with a name close to his ever playing with the team.

Over the years, Ross has scaled down his tale of playing defensive end for the Cleveland Browns. "I tried out and was accepted" in 1948, he now says, but "I broke my arm in training camp with the Cleveland Browns—I have a plate in my arm." His career with the Browns was short-lived, he now claims. "Because of the arm it went fast. I got in and out of the camp fast." Where was the camp? "Cleveland—somewhere.''

Dozens of people who have been close to Ross sympathize with, more than criticize, his mythmaking. "Steve invented all that stuff," says one of them. "Steve's accomplishments are really extraordinary. He does not have to invent false history. I think it speaks to his lack of feeling good about himself. I don't say he's unique in this regard, not at all. Nor do I hold it against him. It makes me feel sad for him."

In those days, even after World War II, American business was largely segregated. Blacks, who had been totally segregated in the armed services (in sports as well), were still virtually inadmissible in the white-collar working world. Firstor second-generation Jews were incomparably better off but still mostly shunned in businesses run by Wasps and more assimilated Jews. Irish and Italians were in similar confinement. Steve Ross and his striving friends, raised in the Bronx or Brooklyn, and from the "wrong" or no colleges, had to make their own way in a harsher, hustling world.

"Machers," they were called, a halfderisive word for "doers" in the Yiddish idiom Ross never uses. "They were selfmade New York Jewish businessmen," one of their more privileged colleagues says. "A few were either working in secondary positions in good investment banks or senior positions in bad ones— they were deal-oriented." They heard the usually unspoken but clear message that they should "stay with their own" and not invade established businesses. So whatever his prowess on the playing fields and his charming presence, Ross found himself in New York's garment district. He started as a stockroom boy and was later a salesman of sports slacks, then a children's-bathing-suit salesman in a company owned by an uncle.

In 1954, when he was twenty-six, he married Carol Rosenthal, the handsome daughter of the owner of the Riverside, an expanding West Side funeral-parlor empire. The Rosenthal family offered their new son-in-law a job in the business. Ross at first said no. "I said I can be cut twenty-two places and it's fine with me," recalls Ross. "But I can't stand to see anyone else cut. I could pass out." They understood and told him, "No, not downstairs, upstairs in administration." From upstairs, away from the embalmers, Ross built the Riverside into the mini-conglomerate Kinney Corporation.

At home, things weren't going so well. "When I was in the funeral business," Ross says, "I sometimes worked a night shift. That's not very conducive to a good marriage." While Ross was expanding Kinney into the movie business, he was spending much of his time in California or working on deals in New York. Even fewer hours were left for his wife, son, and daughter. In 1974 they separated and in 1978 divorced.

Of the marriage, a chastened Ross says today, "I have a thirty-four-year-old and a twenty-nine-year-old and now an eightyear-old. I always said I'd give them more time. So I just hope that we're all right in saying quality is more important than quantity when you have been given a second chance."

By then Ross was a risen star in the corporate movie world. He met Courtney Sale, the daughter of a Texas Coca-Cola-bottling family. An attractive Skidmore graduate, she had run her own small art gallery in Dallas before transplanting herself to New York. She began working as an art dealer for several galleries and was an aspiring documentaryfilm maker. A Warner friend had introduced her to Ross. For two years they were inseparable, until one night at that favorite watering hole "21" he met Amanda Burden.

In Orson Welles's landmark film, Citizen Kane, the key to unlocking the mysteries of Charles Foster Kane's life is a child's sled hauntingly referred to at the beginning and end of the movie as "Rosebud." "If there's a Rosebud in Steve's life," says someone who knows Ross well, "it will take you back to Amanda."

At thirty-one, Amanda Mortimer Burden was finishing a postponed college education at Sarah Lawrence College in Bronxville, a suburb of New York City. Amanda was as beautiful an undergraduate as ever graced a college campus, with social credentials to match. She was the daughter of the socially registered Stanley Mortimer and the impeccable style setter Barbara "Babe" Paley, second wife of CBS chairman William S. Paley and one of New York and Boston's "fabulous Cushing sisters." Each of the sisters had married "well": Babe to Wall Street and Standard Oil heir Stanley Mortimer, then to Paley; her sister Minnie to Vincent Astor, later to the painter James Fosburgh; and Betsey, first to James Roosevelt, F.D.R.'s eldest son, and then to John Hay "Jock" Whitney.

Amanda, who had divorced Carter Burden, another New Yorker prominent in the Social Register, was introduced to Steve Ross by her friend William vanden Heuvel. Ken Rosen suggested it.

Courtney Sale was no match for the alluring, flirtatious Amanda. Ross instantly set Courtney aside. Within months, he had moved into Amanda's apartment at 10 Gracie Square, overlooking the East River. Ross became her round-the-clock companion, and embraced her two young children, showering them with treats.

When Ross flew to China with a group of Warner cronies and their wives, Amanda went along. She and the children accompanied Ross on a trip to Disneyland. When he took friends on the Warner plane to Las Vegas, she and other friends watched him, glistening with sweat under his three-piece suit, chips overflowing every pocket, happily distributing some of his card-table winnings to his guests.

Second only to his movie studio, Ross's biggest enthusiasm was the Warner-owned Cosmos soccer team. He was such a rooter at every game that, as a joke, aides gave him a parachute-type harness, supposedly to keep him from falling out of his box as he cheered the Cosmos on. Amanda went with him to every game, knew all the players, and enjoyed becoming a soccer groupie.

From the Beverly Hills Hotel pool to the charity ballrooms of New York, they became the talk of both coasts. Her mother, Babe, who had no fondness for Jews in the abstract, liked Ross less in person. Bill Paley, who had grown up in a Chicago ghetto, was rich and a young-manabout-town by the time he and his family settled in Philadelphia. He became prouder of his broadcast eminence, his friendship with Jock Whitney, his finely hewn taste in art, and the cultural artifacts of aristocracy than of his Jewish roots. At a small CBS meeting, Paley once asked an incredulous executive who used the word "kvetch" what it meant. Ross was not Paley's kind of Jew—"Tacky," he said. "Paley was imperious and thought of himself as a king," says one former Warner executive, "which just heightened Steve's sense of unworthiness."

Amanda had been a neglected child, tended by nannies, never close to her mother. Amanda's conspicuous public displays of affection for Ross seemed to her friends to be her way of striking, in one blow, at both her mother's and stepfather's snobbery. "She was sticking it to them," speculates one intimate.

She arranged Ross's lavish fiftiethbirthday party. It was described by one awed Warner executive: "Three hundred of Steve's closest friends were there at the Waldorf. It was one of the greatest parties of all times. Governor Hugh Carey and Sinatra. Joe Raposo composed a special song. Clint Eastwood sent a telegram. It was written up in the social pages. I was so privileged to be there. It was mostly corporate people—a pecking-order party, all corporate and divisional. Those kinds of things made you feel like family."

Ross's family was always at Warner, never at the Paleys', where he was treated with condescension. Sally Bedell Smith reports in her biography of Paley that in 1978, when Babe Paley died of cancer,

Bill Paley picked up the phone to call Steve Ross, then chairman of Warner Communications, who was dating Amanda at the time and would marry her a year later. In the early days of his career, Ross had been an undertaker. "Call me when it is over and I'll be there," he had said to Amanda. Arriving within minutes, Ross said, "If you go out of the bedroom, I will take care of it all." So the family filed out, leaving a silver-haired movie mogul to tend to arrangements for Babe Paley's lifeless body.

Ross, several of his associates say, "still gives great funerals." But marriage ceremonies were a different matter. He wanted his ex-wife, Carol, to marry again (she did in June 1979) before he himself did, so as not to disaffect the Rosenthal family, another friend explains. Ross was a reluctant groom, more comfortable with the people who worked for him than in the salons of Amanda's or the Paleys' friends. Their potential marriage created a fiery on-and-off tension between them. On her deathbed. Babe Paley was told by a friend that the marriage seemed to be off. Babe beamed, the friend says, rose weakly from her bed, and "danced a little jig," chanting happily, "They're not getting married, they're not getting married."

But in November of 1979, after four years of vacillation, they were married privately. Later, Paley gave the wedding party in his opulent apartment. The guests were mostly Amanda's and Paley's friends, with a small sprinkling of Warner executives. When one of Ross's officemates rose to deliver a tasteless toast suggesting that, since they had been living together so long, what was so exciting about this wedding, Paley harrumphed to a guest close at hand, "Brooklyn meets Park Avenue."

If the long courtship had often been romantic, the marriage was tense. Although Ross was one of the most generously rewarded executives in the country, within the family he complained incessantly to both his wives about being short of money, never failing to display his high living elsewhere. Apart from his business, Ross seemed to have few interests. Backgammon, at which he was a whiz, was his favorite diversion.

Although the glamorous couple showed up in the gossip columns mostly at charity dinners and political fund-raisers, they spent more time with Ross's Warner pals, cultivating his show-biz and growing political connections, than they did on Amanda's turf. There were no quiet moments of reading, since Ross doesn't read; four longtime Ross associates say separately that Ross has never been known to have read a single book in the years they have known him.

On the evenings Amanda and he were home alone, Ross, often clad in a bathrobe, watched movies, played with Amanda's children, or sat in a comer scribbling notes for deals on small pads. When they went out evenings, if he hadn't had his hair coiffed in the office, a stylist took care of him at home. Everyone who knows him says he has always been meticulous about his appearance.

No one had yet coined the term "trophy wife," but Amanda was the comeliest trophy of that species. Though she was simply if tastefully adorned—"the Halston look"—before she met Ross, he did spend to redecorate her. Ross bought her wardrobes of clothes from Giorgio's of Beverly Hills on Rodeo Drive. He also gave her a few baubles (two pairs of earrings, a ring and bracelet), and liked to see her "dressed up" when they went out.

Even her fine piquant features were emboldened by enhancing new makeup, right down to her newly reddened fingernails. Whatever their troubles at home, in public Steve carried her on his arm with the proud look of the possessor of the finest pick in the aviary. "He became different when he married Amanda," says a close friend. "He was a Brooklyn boy and he was basking in her glow." Another friend who knew them both says, "It was the start of Steve's public persona when he met Amanda. And when they married, he thought he was getting Babe Paley. She hoped she might be getting another Bill Paley. They were both wrong. Steve changed dramatically after the marriage. He loved the social aspect of it. He was all caught up in it."

Nonsense, says Ross, "that's wrong." It was Warner's growth and his new relationship with Paley that were the main differences in his life. "Other than my lunches or dinners with Bill," things were the same, he says. "Bill and I used to have these discussions about cable versus networks. He had CBS Records. We had Warner Records. We were both in publishing. He was a customer of ours. We sold them some TV shows and movies. So we had interesting business and personal discussions. We got along very well. My life didn't change at all."

In the eighth month of his marriage to Amanda, Ross was suddenly rushed from his office to nearby Lenox Hill Hospital, struck down by a heart attack. After treatment and a summer of recovery, Steve took Amanda off on a convalescent cruise to the Caribbean aboard the Q.E. 2, among tourists and holiday revelers. Amanda hated it; Ross surrounded himself with the strangers aboard and charmed them.

When they returned, Ross, who'd conquered his addiction of five packs of Parliaments a day ("I was never without a cigarette," he says), had more than his health on his mind. He had put his sadness over Ken Rosen behind him and handsomely remarried. But the month after their return from the Caribbean, one week after they moved into a gargantuan Park Avenue triplex previously owned by Seagram heir Edgar Bronfman, Ross got another stunning blow. After barely sixteen months of married life, Amanda had had enough. She walked out.

Ross was angered, hurt, but powerless. He flew off to Warner's Acapulco haven with his lady-in-waiting, Courtney Sale. In the spring of that year, Ross demanded an immediate divorce. Granted.

After their divorce, Amanda Mortimer Burden Ross had her pick of surnames. She chose to be known thereafter as Amanda Burden.

A year later, in October of 1982, close to three hundred guests gathered in the ballroom of the Plaza hotel, including Governor Hugh Carey, Steven Spielberg, Cary Grant, Barbara Walters, and Quincy Jones. They heard another wedding toast, this time to Courtney and Steve from Warner Bros.' Ted Ashley: "To Steve Ross, who, for all his success, has continued to find true happiness elusive—until now."

Not quite. It was only intermission time in the seesaw melodrama that was Steve Ross's life.

"When you're all done," says one veteran Warner executive who was forced out, "you can't make mincemeat out of the guy, because he has amazing talent— and huge fatal flaws."

In the years ahead, Ross's flaws haunted him, but his talent overcame, producing the biggest deal of his life. Did he consider the merger with Time Inc. the capstone of his career? "I hope not," Ross says. "I don't see it as an end." In language reminiscent of George Leigh Mallory's answer to the question of why he wanted to climb Mount Everest ("Because it is there") or Willie Sutton's explanation of why he robbed banks ("That's where the money is"), Ross describes his inhalation of Time:

"I just feel it was something that had to be done, a natural. When you look at it as a businessman, it was there and we did it. Other people describe it differently, but I guess one would have to say that this is the biggest in my life because it was a $14 billion deal. In 1962, when we put Kinney together, then in 1969, when we acquired Warner-Seven Arts, that was unique, all different turns of events. So you reflect back and you say, Well, you started a company in 1962 that was acquired in 1989 for $14 billion. It's something that one will always remember."