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Monday, June 30, 2014

The Origins of ABC

Long before The Walt Disney Company purchased ABC in 1995, even before it invested in DISNEYLAND in 1955, ABC was a fledgling network that owed its very existence to anti-trust law. You see, it was formed from the cast off parts of two companies- NBC and Paramount.

Under the old studio system, the big studios owned their own theaters. This was deemed a violation of anti-trust law, however, so the studios had to divest their theater holdings. Paramount spunoff its theater chain into an independent company run by Leonard Goldenson. 

Meanwhile, NBC and CBS also ran afoul of anti-trust laws. Back then, they were mostly involved in radio and ran coast to coast radio networks. NBC had two separate networks- NBC Red and NBC Blue. The red stations were the stronger ones, so when they had to sell off part of their empire, they chose to sell NBC Blue.

Sensing that movie theaters had already seen their greatest years, Mr. Goldenson chose to buy NBC Blue, sell off Paramount's theaters and form a third network- ABC. It would find itself hanging on by a string until it chose to invest in a tiny park that a crazy man planned to open in Anaheim, California. A decision that would turn the third place network into a powerhouse.