Jeff Bewkes Blames AT&T Incompetence For Bungled Time Warner, HBO Mergers
from the everybody-is-to-blame-except-myself 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.
In a new book slated to be released next week, Time Warner CEO Jeff Bewkes didn't hold back when talking about AT&T's absolute incompetence at running a media empire:
"The most disappointing thing to me about the AT&T merger," Mr. Bewkes is quoted in the book as saying, is that he and his board thought AT&T "would basically leave our people alone." That didn't happen, he said. "We didn't think they would go to such a level of malpractice as to not listen to anybody… even though they themselves had no experience in those areas."
Granted Bewkes was the one that proposed the sale of Time Warner and HBO to AT&T in the first place as a way to fend off a Rupert Murdoch News Corporation acquisition attempt. But if you've paid even the slightest bit of attention to U.S. telecom over the past 30 years, you quickly come to understand that US telecom a sector dominated by hubris and yes men and women who live in reality-optional bubbles. Being a government pampered monopoly creates an executive culture that's not great at listening to or playing with others, and AT&T is the poster child.
Whether it's Verizon's Go90 or AT&T's megamerger spree, the end result is always fairly consistent any time a telecom giant wanders outside of its core competencies (running networks and lobbying to dismantle competition and regulatory oversight). 50,000 people lost their jobs as a result of AT&T incompetence and hubris, and AT&T executives are still out there acting as if they are the victims. That's the message again sent in the book by AT&T CEO John Stankey, who blames everybody but himself for the implosion:
"If you are in an acquisition and somebody pays a premium for your stock, by definition it means something has to change," Stankey is quoted as saying in Miller's book, according to the WSJ. "If you paid a premium for an operation and you continue to operate it exactly the same way, you never pay back the premium."
Stankey also said that "he still believes in the vision behind AT&T's purchase" but that he made the spinoff deal with Discovery in part because investors "refused to give us credit for [the] progress" made with Time Warner. "One of the jobs I need to do in carrying AT&T forward is ensuring we come up with a strategy that the investor base will tolerate and work through and give us the right credit for," Stankey said.
This is the same AT&T that not only proposed but funded OAN as a facts option disinformation mill. It's the same company that has repeatedly been caught ripping off customers, governments, and schools, and has spent decades engaging in sleazy lobbying tactics to protect its regional broadband monopoly. And it's the same telecom industry that has failed repeatedly every single time they try something new (mobile payment systems, app stores, Millennial-targeting ad ventures, apps, whatever). Especially if it requires collaboration, competition, innovation, creativity, and adaptation.
Anybody surprised that myopic telecom monopoly executives wouldn't be good at running a new media venture in a functional, competitive new market either wasn't paying attention -- or was just blinded by giant number signs.
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Filed Under: competition, content, jeff bewkes, merger, telcos
Companies: at&t, hbo, time warner
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"If you are in an acquisition and somebody pays a premium for your stock, by definition it means something has to change," Stankey is quoted as saying in Miller's book, according to the WSJ. "If you paid a premium for an operation and you continue to operate it exactly the same way, you never pay back the premium."
Yeah... I don't know what dictionary he uses but I have never heard of that definition for premium. That whole paragraph makes no sense.
"give us the right credit for"... I believe you were given the right credit... you messed thing up and were given credit for doing that. Job well done.
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Re:
Stock in itself has no value. The only value comes from what someone else will pay for it when you sell it. Until you sell it, it has no intrinsic value (just ask the former owners of Enron stock).
See also: the Tulip Mania of 1634
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"and give us the right credit for"
We are trying to give you credit for destroying shareholder value & you are fighting tooth and nail trying to pretend it wasn't your bad leadership that screwed it all up.
You think you are a master of the universe, but your entire industry is given training wheels by every governmental entity who should be taking you to the woodshed with all the shit you've pulled.
You haven't built ATT to be anything, decades of lobbying created a bloated screwed up company that makes money because no one else gets to use the playground. You magically forget that your 'success' is due to not having to compete or pay for your sins & make these grand plans assuming that running a zombie corporation that would keep trudging along with or without you at the helm can totes do what these other companies who actually work for a living can do.
Stay in your lane, stop buying and screwing things up.
Without the government holding your hand, you really shouldn't try to cross the street.
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Re: Shareholders burned
yeah, the AT&T shareholders paid a heavy price for the incompetence of their top (hired) managent.
But of course that top management retains their fat salaries/perks/golden-parachutes.
This destructive oligarchic diseae ultimately infects most huge organizations -- especially government ones.
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Re:
Imagine if they didn't get free government cash to basically do nothing, and weren't premited to lock out competitors from their networks and markets?
They'd either shape up or die. I'm fine with either.
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Re: Re:
Sadly, I suspect "imagine" might be the best you can do. I genuinely don't see the leaders of major companies getting meaningfully punished, or suffer the consequences of poorly made decisions. They're far too well protected.
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Karl's made it clear he doesn't read the comments, because he keeps repeating this line, but just to reiterate:
DC had been dismantling Vertigo for years before the AT&T merger. AT&T fucked up a lot of stuff at Warner after the merger, but pre-merger WB was doing just fine smothering Vertigo all by itself.
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On the plus side...
AT&T has billions less to spend on lobbying.
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Re: On the plus side...
AT&T has the same (or more) to spend on lobbying.
AT&T has billions less to spend on providing an acceptable level of service.
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Re: On the plus side...
You ever looked at how cheaply you can purchase your own pocket congress critter?
Its a pittance.
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So many little things happening in this.
Wow, what a way to clear out the Veteran workers and the Low level workers to start over at LOWER wages.
Love that a Corp, that Lobbies the gov.(with money paid to them by Us), Gets money from the Gov. (our money), Buys up other companies, Raises Prices(our money), then repeats.
Why is our Money fighting Against us?
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