AT&T CFO Wants A Cookie For Screwing Up The Time Warner, DirecTV Mergers
from the fail-upward dept
We've noted more than a few times how the AT&T Time Warner and DirecTV mergers were a monumental, historical disaster. AT&T spent $200 billion to acquire both companies thinking it would dominate the video and internet ad space. Instead, the company lost 9 million subscribers in nine years, fired 50,000 employees, closed numerous popular brands (DC's Vertigo imprint, Mad Magazine), and basically stumbled around incompetently for several years before recently spinning off the entire mess for a song.
I just got done noting how the US press' total failure to adequately outline the scope of this mess ensures that the executives, regulators, and various megamerger cheerleaders will never be held accountable for it. That, in turn, all but guarantees it will happen again. And again. And again. America's obsession with "growth for growth's sake" and megamergers is built on the inherent promise that no matter how many times a megadeal results in layoffs, chaos, and no benefits for anyone other than executives and investors, we'll simply refuse to learn anything from the experience.
That requires a lot of revisionist history. So, as if on cue, AT&T CFO Pascal Desroches this week complained that AT&T didn't get enough credit for turning HBO Max into a successful streaming brand. AT&T was forced to spin off this mess because the doddering telco sucked at running a media company. But Desroches is trying to claim the recent spinoff of its media ventures occurred because AT&T didn't get enough credit for building HBO:
"AT&T CEO John Stankey was “keenly focused on” the company being in the early stages of a “significant evolution in connectivity,” 5G and fiber, with management knowing it needed to invest there and in HBO Max, he told the Oppenheimer Annual Technology, Internet & Communications Conference.
“One of the things we realized (was that), even though we were succeeding in our launch of HBO Max, the market wasn’t giving us the appropriate credit for it,” Desroches said.
This is a weird rewriting of history. Ex-AT&T CEO Randall Stephenson was literally shoved into early retirement because instead of focusing on the company's core competencies (running and building networks; spying on Americans; lobbying the government to hamstring competition), AT&T blew an absolute ocean of money trying to elbow its way into the TV business. But like so many telcos (see: Verizon Go90), decades as a pampered government telecom monopoly leaves you ill-suited toward making adequate inroads in creative, competitive industries.
To be clear, AT&T's path post-merger was pretty obvious. It had to take the HBO brand, not fuck it up, and shovel it into a functional streaming experience. But the company struggled for the first several years to do that. It released so many conflicting, confusing AT&T and HBO streaming brands that they even managed to confuse their own support employees. Meanwhile, AT&T executives, obsessed with engagement over quality, have taken the HBO brand and watered it down. Now you can see a lot of quality HBO fare like Six Feet Under intermingled with AT&T concepts like "Fuckboy Island," which kind of speaks for itself.
If you actually talk to any of the creatives at places like DC or HBO (the ones who weren't fired, anyway), they're quick to point out that AT&T brass really had no idea what they were doing. It was like having an alleyway brawler run an opera house. Telcos aren't good at adaptation, creativity, competition, or innovation, because as government-pampered monopolies, they've never had to be. I'm not sure how many times we have to watch a telco fall on its face in this fashion before that becomes clear to people.
The reality is that AT&T screwed up, then had to spin off the entire mess because it screwed up. For AT&T's CFO to suggest the spin off was because the "market didn't give us a cookie" for building HBO Max is some weird, revisionist history. Revisionist history that once again ignores the 50,000 post-merger(s) layoffs, the fact AT&T received billions from government to make all of this work (the $42 billion Trump tax cut, merger approvals, the death of net neutrality), and still somehow screwed it up. There is absolutely no scenario in which any AT&T executive involved in any aspect of this mess gets a cookie.
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Filed Under: acquisitions, broadband, content, hbo, john stankey, mergers, pascal desroches
Companies: at&t, directv, time warner
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Send the dude back to business school. The market doesn't run on cookies, it runs on money.
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A common criticism of millennials and Gen Z is mocking them for participation trophies.
Nobody seems to point out that boomers have been demanding them ever since they felt insecure and irrelevant.
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In today's world, people expect a "cookie" for anything, because the companies in charge of ratings have set it up that way. If you want to leave a review saying how bad a product or service is, you'll likely have to give them at least 1 point to do so. "My driver tried to murder me. Here's a star, but only one!"
IMDb gives 4 stars to "FBoy Island", which the Buzzfeed writer thought "sound[ed] amazing"—so maybe it doesn't quite speak for itself. If you look at their chart of the worst movies ever, you'll find nothing below 2.0. In fact, Kirk Cameron's Saving Christmas shows 1.4 on the linked page; still, you produce the apparent biggest piece of shit ever, that's good for 1.4 cookies by IMDb standards. This is exactly the kindergarten "everyone gets a star" concept made real.
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Fastest way to wreak a business....
Fastest way to wreak a business is to put MBAs in charge.
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There is a special place in hell reserved for cancelling Mad Magazine...it is below Beezelbub's toilet bowl since everything that company now touches turns to fecal matter.
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Money is an unnecessary convenience; the market relies on PROVIDING A GOOD PRODUCT EFFICIENTLY ENOUGH TO MAKE IT AFFORDABLE.
You can take barterable goods (or wampum, beads, or coins) from people by force, and then provide them with some product they wouldn't have paid for--but that's not a "market", that's a "tax". If anyone (except a government) does that, it's "organized crime".
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AT&T website privacy notice
In order to best congratulate ourselves for our services, our CEO requires cookies. By using our website, you agree to send one dozen walnut-prune macaroons to our corporate offices within three days of clicking "Agree".
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Mad Magazine would have been a good place to do a "story" on AT&T and its catalog of messy things.
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Their attempt to abolish cookies in favor of magic-packets shouldn't entitle them to a cookie now
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The old ways are gone.
ATT and others have been having a hard time trying to adapt to the New World of the internet.
We have watched over many years as Allot of video sites come and go. Some tried to fight back, and NOT be liable for what was published on their sites, as in section 230 WHICH should have protected many of them.
There were allot of confusing lawsuits in the past, back and forth and around, and Who was right/wrong or in a court that had very little tech knowledge.
We have watched many of the channels Try to jump onto the net and build something, even the cartoon channels made things abit 'Stupid'(more commercial then cartoons). You would think an ISP would have Some fundamentals of How the internet works.
Google learned by Jumping in with allot of tech and machines. And I wonder how many lawsuits they fought off.
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The new target
AT&T is going now after the billions in the new infrastructure package negotiated by Congress. They figured ..there is nothing like free money..if in doubt waTch the crumbling Telco infrastructure in AT&T territory.
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I don't think Karl's reading the comments, since he keeps repeating this line even though I've pointed out on two separate occasions that it's not really reasonable to lay the end of Vertigo at AT&T's feet, but here it is again in case it's useful information for anyone here in the comments:
There's plenty of stuff AT&T fucked up (and Mad is definitely on that list). But WB corporate had it in for Vertigo years before it became AT&T corporate.
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Re:
"Cancelling" isn't really the right word; it's still being published, but it's mostly reprints now. Last I checked they were still putting a few pages of new material in each issue, but it was mostly old stuff.
Still and all, yeah, it's an utterly boneheaded move, creatively and commercially. I hope that the new owners at Discovery reverse course on that and some of AT&T's other disastrous decisions.
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Re: Fastest way to wreak a business....
Please tell me how I can get such a management job, getting paid millions a year for generating billions a year in losses!
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Corrupt, not stupid
America's obsession with "growth for growth's sake" and megamergers is built on the inherent promise that no matter how many times a megadeal results in layoffs, chaos, and no benefits for anyone other than executives and investors, we'll simply refuse to learn anything from the experience.
Oh the irony of blaming the press for softselling the failure and ensuring it'll be repeated and then doing the same thing...
Barring maybe some really new and naive individuals none of the people involved are idiots. They are not cheering on and supporting mergers because they 'just don't know any better' they know full well what's going to happen and support it anyway because it's certain to be profitable for them either directly or indirectly. If the people involved were as stupid as they'd have to be to see example, after example, after example of what mergers like this do and not get it they'd be incapable of getting to work never mind actually doing the job, so treating them like idiots by framing the problem as them just not learning from the past is giving them way more benefit of the doubt than they deserve.
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Re: Re: Fastest way to wreak a business....
Go to a MBA mill school, have no idea about industry you're in, but convince the board you have "business savy" because of the three letters, write a contract with a golden parachute, profit...
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Re: Re: Re: Fastest way to wreak a business....
But I am sick of top executives getting over the top pay because of the "risk and responsibilities" of their positions, but also get a golden parachute if they are fired, which basically nullifies the reason they supposedly get over the top pay to begin with....
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Can... can i pay for my internet or other AT&T bills with "appropriate credit"? I would sure be happy to do that, as would millions of others.
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Re: Re: Re: Re: Fastest way to wreak a business....
Even without the classical golden parachute or the pay and benefit scale that rapidly inflated over the last decades, CEOs were never taking any fucking "risk", and most don't have any special skill or knowledge. Even networking claims are shit since everyone in those networks are the same as the last dumbfuck. That's all just a scammy meme corporate culture has been trying to shove into our minds. (Well, just like most of the bullshit they claim is "capitalism" or "innovation" or "progress", really.)
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Cookie?
How about a foot you know where?!!
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Re: Re: Re: Re: Re: Fastest way to wreak a business....
While I do see good reasons for top managers to have (somewhat) bigger salaries than factory workers; I don't see a reason for excessive salaries (more than a factor 10 of a typical worker).
I admit that a good manager makes a difference for a company (Steve Jobs for Apple), but there are a lot of bad managers with too high a salary for their quality. Look for managers that "hop jobs" every few years and ask their former companies what they achieved in those years. A good manager can stay at his company because he knows there are no skeletons in his closet.
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Re: Re: Re: Re: Re: Re: Fastest way to wreak a business....
The disparity between top managers and people-who-actually-do-stuff was wide enough in the 40s.
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Re:
You do realize that those are based upon averages?
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Re: Re:
Yeah, but what of it? Zero and negative values are not an option, which makes these very biased averages. A person now expresses extreme displeasure by giving one or two "cookies". When I went to school, a person with a failing mark of 40% would not get 4 stars (effectively what IMDb does); they'd get zero, as would anyone below like 80%.
I've definitely seen movies that deserve negative ratings. Like, if you watch this for an hour, the badness of it will stick in your mind long enough to effectively waste three hours of your life. Perhaps I'm just being old-fashioned, but I think the ratings should be more like 0 for something that goes as expected, positive for things that especially good in some way (as in the Michelin star system), and negative for bad experiences.
There's real pressure to give maximal ratings for completely average experinces. Uber, for example, may demote any driver with an average rating below 4.75/5. That's fucked up, and devalues the whole system. Someone doesn't deserve 5/5 stars for driving me someone without incident, but apparently I'd be an asshole for giving them any less—leaving me no good way to reward drivers that go above and beyond. It probably all started with eBay: "they took my money and shipped the product, and it arrived and actually works! Internet shopping, amazing!! A+++++++!!!!".
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