Llewellyn King: The case against mega-mergers is written in U.S. history
A judge has green-lighted the $85 billion merger of Time Warner and AT&T. Unless the Trump administration appeals and wins on appeal, another behemoth will take the field.
This merger, it is assumed, will lead to a flurry of other mergers in communications. Witness Comcast’s $65 billion bid for Fox, topping Disney’s $52.4 billion offer.
This is heady stuff. The money on the table is enormous, in some cases dwarfing the economies of small countries.
Merging is an industry unto itself. A lot of people get very rich: They are investment bankers, arbitragers, lawyers, economists, accountants, publicists and opinion researchers. When really big money moves, some of it falls off the table into the willing hands of those who have managed the movement.
The fate of the real owners of these companies, the stockholders, is more doubtful after the initial run-up. The earlier merger of Time with Warner Communications is considered to have been disadvantageous for stockholders.
Another concern is the mediocre performance of conglomerates. The latest to have run into trouble is General Electric, which had managed to do well in many businesses until recently.
A more cautionary story is what happened to Westinghouse when it went whole hog into broadcasting and lost its footing in the electric generation businesses. This was spun off, sold to British Nuclear Fuels in 1997, then sold again to Toshiba and later went into bankruptcy.
From the 1950s, Westinghouse it bought and sold companies at a furious rate, until the core company itself was sold in favor of broadcasting. One of Westinghouse’s most successful chairmen, Bob Kirby, told me it was easier for him to buy or sell a company than to make a small internal decision.
In another pure financial play, a group of hedge funds bought Toys R Us and with the added debt, it failed.
In many things, big is essential in today’s economy. News organizations need substantial financial strength to be able to do the job. Witness the cost of covering the Quebec and Singapore summits. As Westinghouse proved by default, big construction needs big resources. That is indisputable.
When growth through acquisition becomes the modus operandi of a company, something has gone very wrong. The losers are the public and the customers. The new AT&T, if it comes about, will still need you and I to lift the receiver, watch its videos and subscribe to its bundles.
Recently, I was discussing the problems customers have with behemoth corporations on SiriusXM Radio's "The Morning Briefing with Tim Farley" when a listener tweeted that I hated big companies and their CEOs and loved big government.
Actually, I’d just spent a week with the CEOs of several companies, admirable people, and I don’t think government should be any bigger than needs be. I certainly don’t think government should perform functions that can be better performed in the private sector.
The problem is size itself.
When any organization gets too big, it begins to get muscle-bound, self-regarding. Although it might’ve been built on daring innovation, as many firms have been, supersized companies have difficulty in allowing new thinking, reacting nimbly and adopting innovative technologies and materials.
If large corporate entities were as nimble as small ones, the automobile companies would’ve become the airplane manufacturers in the 1920s and 1930s. They had the money, the manufacturing know-how and the engineering talent. They lacked the vision. It was easier to be rent-takers in the production and sale of automobiles.
Likewise, it’s incredible that FedEx was able to conquer the delivery business when another delivery system, Western Union, was up and running. But Western Union was big, smug and monopolistic. They had the resources and an army of staff delivering telegrams.
Companies like Alphabet (Google’s owner) snap up start-ups as soon as they are proven. That snuffs out the creativity early, even if it wasn’t meant to, and makes Google even more dominant. I would argue too big for its own good -- and for ours.
Llewellyn King (llewellynking1@gmail.com) is executive producer and host of White House Chronicle, on PBS. He is based in Rhode Island and Washington, D.C.
The epicenter of merger mania -- Wall Street, with the New York Stock Exchange draped with the flag.
Mark Luskus: Corporate interests use stolen identities to flood Internet with fake comments
Via OtherWords.org
My identity was stolen this year. The perpetrator didn’t open credit cards in my name or gain access to my finances. Instead, they used my name to submit a comment to the Federal Communications Commission (FCC) in support of repealing net neutrality rules.
Those rules, enacted in 2015, declared the internet to be a free and open place. They prevent Internet service providers, or ISPs, like Comcast and AT&T from restricting access to any Web sites — either permanently or to charge you more money to access them.
Imagine your water company charging you more for the water that comes out of your shower than the water that comes out of your sink. Or imagine not being allowed to use your shower at all, even though you pay a water bill.
That’s what net neutrality rules protect consumers from when it comes to the internet.
But Ajit Pai, the current FCC chairman and a former very high-level lawyer for Verizon, and his Republican colleagues on the commission has voted to repeal net neutrality. To do this, he had to solicit public to comment on the matter.
In the past, this has resulted in millions of pro-net neutrality comments — which makes sense, because most Americans support it. But this time, an unusual number of anti-net neutrality comments showed up.
Why? Because of the 22 million comments received, half or more of them appear to be fake, likely posted by bots or special interest organizations attempting to sway the FCC’s opinion. When I checked the FCC’s Web site, I learned that one of those fake comments used my own name and address.
Someone had stolen my identity to advocate for a position that I didn’t agree with.
Several people and organizations, including the New York attorney general, have petitioned the FCC for information on the scale and origin of fake comments. However, the FCC has rejected these petitions.
As a federal agency, the FCC should be far more concerned about the identity theft of the citizens they’re tasked to represent.
Internet providers like Verizon, the former employer of the FCC chairman, complain that net neutrality rules slow their investments in internet technology. However, ISPs exist in a shockingly non-competitive market.
More than 50 million households in the United States have only one choice of provider, and those providers score the lowest customer satisfaction rates of all 43 industries tracked by the American Consumer Satisfaction Index. Personally, I’ve never had an ISP that offers reasonable customer service or internet speeds and reliability at the levels I pay for.
This isn’t an industry that consumers are satisfied with, so why should they hold even more power than they already do? No wonder they have to rely on sleazy tactics like stealing identities and posting fake comments.
The internet has become an essential tool in the 21st Century. A small handful of companies shouldn’t have the power to decide which parts of it people can access.
Corporate-funded lies and identity theft highlight a major threat to the benefits of increased communication. How can we prevent special interest groups from warping the internet to spread misinformation and further their political goals?
That’s a question we must answer, because misinformation campaigns are rampant, and they’re being used to restrict your rights and freedoms. But at the very least, a former Verizon employee shouldn’t hold the power to give ISPs a major win at the expense of consumers — and a free and open Internet.
Mark Luskus is a med student at Emory University, in Atlanta He’s particularly interested in infectious diseases and public policy.
Jim Hightower: Those billboards are watching you
Via OtherWords.org
OK, people, we need to discuss billboards. Yes, we really must.
At best, these giant corporate placards are problematic — they loom garishly over us, clutter our landscapes, and intrude into our communities with no respect for local aesthetics or preferences. Now, however, billboards are getting a high-tech reboot, allowing advertisers to invade not only our places, but also our privacy.
Having to see billboards everywhere is bad enough. Far worse, though, is that the modernized, digitalized, computerized structures can see you — and track you.
Clear Channel Outdoor Americas, having already splattered the country with tens of thousands of billboards, has revealed that it’s partnering with AT&T and other data snoops to erect “smart” billboards that will know and record when you drive or walk past one.
Using your own mobile phone, they can then follow your travel patterns and consumer behavior. Aggregating that information with other available data, Clear Channel can then know the average age and gender of passersby who see an ad on a particular billboard and know whether they later make purchases.
It’s “a bit creepy,” admits Andy Stevens — Clear Channel’s own vice president for “research and insights.”
Stevens rationalizes the company’s zippy new Orwellian billboards as just another step into the digital future: “We’re just tapping into an existing data ecosystem,” he shrugs. The millions of profiles collected by Clear Channel are “obviously…very valuable to an advertiser.”
Yet maybe they’re more valuable to those of us who treasure our privacy and have given no permission to be targeted and tracked by a billboard huckster. And we thought government spying was out of control.
For information on corporate snooping, go to www.epic.org.
OtherWords columnist Jim Hightower is a radio commentator, writer and public speaker. He’s the editor of the populist newsletter, The Hightower Lowdown.