The Two Real Life Dramas At Cap Cities/Abc

Tom Murphy was playing to a tough crowd. The chairman of Capital Cities/ABC had been invited to speak at a media conference sponsored by investment bank Allen & Co. in Sun Valley, Idaho. But the talk of the meeting was Barry Diller, who had announced a dazzling merger of QVC and CBS, only to see it scuttled two days before Murphy's July 14 speech. How could Murphy possibly top that?

Simple. He told the group that Cap Cities planned to make a bid for General Electric Co. Because federal regulations would prohibit ABC from owning a second network, Murphy said he intended to spin off GE's subsidiary, NBC. And he was talking to Diller about selling it to him. The announcement was an elaborate joke, of course, designed to tickle this deal-crazed audience.