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from Breakingviews:

AT&T puts shareholders on hold for DirecTV

By Jeffrey Goldfarb
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

AT&T is putting its shareholders on hold to buy DirecTV. Its $67 billion acquisition of the satellite TV operator announced on Sunday brings with it an unexpectedly robust $1.6 billion of cost savings. Even so, these don’t quite cover the cost of the premium. In any case, AT&T says it will use the money to roll out rural broadband service. Customers and regulators are getting the first call.

A little more than three years after AT&T launched an eventually torpedoed $39 billion bid for T-Mobile US, it has found another acquisition target big enough to match its ambitions. Instead of expanding in domestic cellular, though, the $190 billion company led by Randall Stephenson is aiming to marry video and broadband as the competitive landscape for television and internet service reshapes for the mobile and digital era.

The deal math suggests AT&T is paying over the odds for its quarry. The synergies AT&T expects from the deal, mainly from cheaper TV programming, amount to a present value of roughly $10 billion. The $95-a-share purchase price represents 30 percent more than where DirecTV stock was trading in late March before a news report indicated it might be bought. So the $11.2 billion premium exceeds the value of the savings.

In what looks like a bid to appease regulators, though, AT&T is pledging to use the money saved to provide high-speed internet service to 15 million locations mostly outside urban areas. Much of it will probably be fixed wireless, which is slower than fiber but also much cheaper to install.

from Jack Shafer:

It’s an ad, ad, ad, ad world

The last place you'd expect to discover a map to navigate the future of the content-advertising landscape would be a book about the golden age of radio. But damn it all to hell, there it is on the concluding 12 pages of Cynthia B. Meyers' new book, A Word From Our Sponsor: Admen, Advertising, and the Golden Age of Radio.

Not to discourage you from reading Meyers' first 281 pages about the co-evolution of broadcasting and advertising before excavating her new media insights, but this is one of those books that demands to be read backwards -- conclusion first, historical arguments and research later. In Meyers' view, advertising is not something appended to radio and TV broadcasts or shimmied into the pages of newspapers and magazines. Advertising has been both the dog wagging the tail and the tail wagging the dog, sometimes occupying points in between, its symbiotic relationship with popular media forever ebbing and cresting. And while the past never predicts the future, this book gives readers a peak around the media future's corner.

The commercial Web that permeates our culture today was revolutionary because it allowed news and entertainment content to migrate from the lockdown of the radio and TV networks, as well as from print. But that migration was already in progress when the first banner ad (for AT&T) ran on Hotwire.com in late 1994. A decade before, cable had given advertisers new venues to place their TV bets, and VCRs (and later DVRs) gave viewers the power to time-shift and edit ads out of their consumption. The advent of videotape and discs further liberated audiences from advertising's hold.

Does bad publicity kill merger plans — and should it?

Last week Fairfax Financial Holdings chief executive officer Prem Watsa insisted that he would not walk away from a BlackBerry deal. “We’ve never renegotiated,” he said. “Over 28 years our reputation is stellar on that front. We just don’t do that.” Watsa’s statement followed a 6 percent loss in share price. The firm was in a tough spot. Reporters covered the market’s lack of enthusiasm and the deal looked like it could be a goner.

What Watsa does is anyone’s guess. But a new paper in the Journal of Financial Economics that examines the media’s role in acquisitions sheds light on the complexities of Watsa’s bad press amid falling share prices. Baixiao Liu of Florida State University and John McConnell of Purdue University found that a CEO was more likely to shelve a bad deal if reporting in the New York Times, the Wall Street Journal and Dow Jones News Service was negative, not necessarily because of its merits, but because of its effect on managers. The authors conclude that news reporting can be a force of good in corporate governance, even when managers act in their interest.

Liu and McConnell examined 636 acquisition attempts by 537 firms between 1990 and 2010 valued at more than $100 million. Of the 636 acquisition attempts, 121, or 19 percent, were abandoned. Annual rates were evenly distributed over time and industries. Between 1990 and 1999, 20 percent were abandoned and from 2000 to 2010, 7 percent were. They controlled for stock ownership, companies in heavily-regulated industries, and other variables that might nudge an acquisition toward the trash heap.

D.C. scandals: They had Nixon ‘to kick around’

President Richard Nixon at a White House press conference during the Watergate scandal. REUTERS/Courtesy Nixon Library

The profusion of scandals bedeviling the Obama administration has evoked many comparisons with other presidencies — particularly Richard M. Nixon. There is no evidence, however, of serious skulduggery by White House officials or members of the re-election campaign, as in the Nixon administration. More important, America’s over-excited and enticed puritanical conscience has not been mobilized to impute what Kafka called “nameless crimes” to the president as there was with Nixon.

There seems no national desire to tear President Barack Obama down. Not like with Nixon, who faced an atavistic desire to destroy a distinguished administration and scuttle its entire effort in Vietnam, in which 57,000 Americans died and hundreds of thousands were wounded. A near unanimity of national media has not suddenly formed to crucify (bloodlessly but no less effectively) the leader of the country, nor is there any pandemic of the tribal conviction that “the king must die.” These were distinctive characteristics of the Watergate and Vietnam crises.

from MediaFile:

Content everywhere? More like content nowhere

Will Big Media and Big Tech companies ever stop punishing their biggest fans?

Like many people, I woke up yesterday and reached for my iPad for my morning hit of news, entertainment and information, so I could start my day. (And like many, I’m embarrassed to admit it.) Padding to the front door to get a newspaper still sounds more respectable, but my iPad gives me a far more current, rich and satisfying media experience than a still-warm printed Times could ever produce.

Except, lately, it doesn’t. Yesterday morning, I saw the exciting news that Bill Simmons, ESPN’s most popular, profane and controversial writer, had secured an interview with President Obama. Simmons published his interview in podcast, text and video form on Grantland, a longform sports journalism website he founded last year under the ESPN umbrella. I clicked over to the story from my Twitter feed and saw three YouTube excerpts of Simmons with Obama. And that’s all I saw. When I hit play on the videos, I discovered ESPN had set them to be “unavailable” on mobile devices.

Moving on, I tried to read a New York Post headline that also found its way into my Twitter feed. But when I tapped in, the Post webpage that loaded was not the story I wanted to read. Instead it was a notice, which I took as an admonition, that to read New York Post content on an iPad, I would have to download the app, which retails for $1.99.

from Paul Smalera:

What real Internet censorship looks like

Lately Internet users in the U.S. have been worried about censorship, copyright legalities and data privacy. Between Twitter’s new censorship policy, the global protests over SOPA/PIPA and ACTA and the outrage over Apple’s iOS allowing apps like Path to access the address book without prior approval, these fears have certainly seemed warranted. But we should also remember that Internet users around the world face far more insidious limitations and intrusions on their Internet usage -- practices, in fact, that would horrify the average American.

Sadly, most of the rest of the world has come to accept censorship as a necessary evil. Although I recently argued that Twitter’s censorship policy at least had the benefit of transparency, it’s still an unfortunate cost of doing global business for a company born and bred with the freedoms of the United States, and founded by tech pioneers whose opportunities and creativity stem directly from our Constitution. Yet by the standards of dictatorial regimes, Internet users in countries like China, Syria and Iran should consider themselves lucky if Twitter’s relatively modest censorship program actually keeps those countries’ governments from shutting down the service. As we are seeing around the world, chances are, unfortunately, it won’t.

Consider the freedoms -- or lack thereof -- Internet users have in Iran. Since this past week, some 30 million Iranian users have been without Internet service thanks to that country’s blocking of the SSL protocol, right at the time of its parliamentary elections. SSL is what turns “http” -- the basic way we access the Web -- into “https”, which Gmail, your bank, your credit card company and thousands of other services use to secure data. SSL provides data encryption so that only each end point -- your browser and the Web server you’re logging into -- can decrypt and access the data contained therein.

from Paul Smalera:

Twitter’s censorship is a gray box of shame, but not for Twitter

Twitter’s announcement this week that it was going to enable country-specific censorship of posts is arousing fury around the Internet. Commentators, activists, protesters and netizens have said it’s “very bad news” and claim to be “#outraged”. Bianca Jagger, for one, asked how to go about boycotting Twitter, on Twitter, according to the New York Times. (Step one might be... well, never mind.) The critics have settled on #TwitterBlackout: all day on Saturday the 28th, they promised to not tweet, as a show of protest and solidarity with those who might be censored.

Here’s the thing: Like Twitter itself, it’s time for the Internet, and its chirping classes, to grow up. Twitter’s policy and its transparency pledge with the censorship watchdog Chilling Effects is the most thoughtful, honest and realistic policy to come out of a technology company in a long time. Even an unsympathetic reading of the new censorship policy bears that out.

To understand why, let’s unpack the policy a bit: First, Twitter has strongly implied it will not remove content under this policy. If that doesn’t sound like a crucial distinction from outright censorship, it is. Taking the new policy with existing ones, the only time Twitter says it will ever remove a tweet altogether is in response to a DMCA request. The DMCA may have its own flaws, but it is a form of censorship that lives separately from the process Twitter has outlined in this recent announcement. Where the DMCA process demands a deletion of copyright-infringing content, Twitter’s censorship policy promises no such takedown: it promises instead only to withhold censored content from the country where the content has been censored. Nothing else.

Supporting the past, ignoring the future

By Rasmus Kleis Nielsen
The opinions expressed are his own.


Western media industries are going through a rapid and often painful transformation today with the rise of the Internet and mobile platforms, the erosion of the largest free-to-air broadcast audiences, and the decline of paid print newspaper circulation.

Despite all these changes, the important and sometimes neglected ways in which governments provide support for the media have remained largely unchanged for decades.

There is a real need to reform our 20th century support arrangements to make sure they effectively serve our needs in the 21st century. Public sector support for the media should not be industrial policy, propping up specific ailing incumbents, but democratic policy, aimed at ensuring that timely, accessible news from a diversity of sources is available to the entire population.

The Fox in the Tea Party

By Theda Skocpol and Vanessa Williamson

The views expressed are their own.


Many observers of the role of U.S. media in politics as of the early twenty­-first century are alarmed that partisanship has crept in. This rarely bothers very conservative pundits, of course, because (even if they constantly com­plain about “liberal media bias”) they know that the elephants in the room are on their side. Liberals and self-styled nonpartisan critics engage in constant tut-tutting about the horrors of partisan media. They forget that American democracy was born and flourished through the nineteenth cen­tury in an environment where major newspapers, the mass media of the day, were all closely aligned with political parties. “Objective news” was not to be found; nineteenth-century editors and reporters alike presented highly se­lective versions of the facts, often in luridly emotional ways.

Only in the twentieth century, as sociologist Michael Schudson explained in his ground-breaking book Discovering the News, did professional journalists gain a degree of autonomy. Journalists developed norms of objectivity and “bal­ance,” which leading newspapers and, later, television networks tried to follow, more or less. Norms of objective journalism led to the convention of looking for quotes from sources on “both sides of the issue”—a practice more reflective of the fact that there were two major parties roaming the U.S. political tundra than of any law that major questions have only two possible answers. Social movements and protest efforts outside the two major parties found it harder to get a hearing in the objective-and-balanced media regime.

Given the impressive scope of conservative media, American democracy is, in an important sense, caught betwixt and between in the new media world. The frank, exuberant, all-around partisanship of the nineteenth century is not quite what we now have. True, there are both liberal and conservative bloggers, and on the tube, the Fox political slant is weakly countered by liberal-slanted shows on MSNBC. But mostly what America has right now is a thousand-pound ­gorilla media juggernaut on the right, operating nineteenth-century style, coex­isting with other news outlets trying to keep up while making fitful efforts, twentieth-century style, to check facts and cover “both sides of the story.”

from The Great Debate UK:

Women leaders: High peaks, low gullies

glenda_stone- Glenda Stone is an Australian businesswomen in the UK, CEO of Aurora and a commentator on economic gender issues. The opinions expressed are her own. Reuters will host a “follow-the-sun” live blog on Monday, March 8, 2010, International Women’s Day. Please tune in.–.-

In Australia there is a common expression of social phenomenon called the “Tall Poppy Syndrome”. It is a pejorative term that describes human behaviour of attacking, despising or attempting to cut down or criticise people of genuine merit because their achievements or talent distinguish them above their peers. Targets are often accomplished people with a public profile: business leaders, politicians, academics - and at times even celebrities and sporting personalities.

The media can be especially vicious in strategising, fuelling and orchestrating smear campaigns with the sole intention of defaming and questioning the character and ability of high-profile leaders.

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