IAC Chief Executive Barry Diller took several groups to task at the Reuters Media Summit, but he reserved special disgust for CEOs at profitable companies who add to the country’s rising unemployment rate.
Also targeted by the former Hollywood executive were “incredibly, shockingly stupid” Big 3 auto executives, the Internet’s strange and growing dictionary, and Hollywood’s lack of creativity.
Diller said companies had a higher obligation, especially in tough times like these:
“The idea of a company that’s earning money, not losing money, that’s not, let’s say ‘industrially endangered,’ to have just cutbacks so they can earn another $12 million or $20 million or $40 million in a year where no one’s counting is really a horrible act when you think about it on every level. First of all, it’s certainly not necessary. It’s doing it at the worst time. It’s throwing people out to a larger, what is inevitably a larger unemployment heap for frankly no good reason.”
A few seconds later, he added:
“It’s not that you don’t want to earn as much money as you can — it is your obligation, of course — but companies have obligations beyond that and they certainly have obligations beyond that at certain times, in the times in which they operate. And they also certainly ought to know that meeting and beating expectations is probably yesterday’s game and it will be increasingly so, which would be by the way very healthy for companies. Running a company that meets and beats expectations, and that runs their company accordingly, are companies that I would question why anyone would invest in.”
Diller was equally confounded by the top three U.S. auto executives, who recently were criticized for separately flying corporate jets to Washington before hearings to request a $25 billion taxpayer bailout.
“It’s incredibly, shockingly stupid if you’re going, when you think about it. On that count alone I wouldn’t give them any money. And not because of any reason other than why would I give money to someone so dumb to go to Washington to ask for money and fly in a Gulfstream. You’d say, ‘You’re not qualified. Unless you leave, I’m not giving you money.’”
Other topics:
* When discussing social networking: “Think of the bimbo words this Internet has created: portal, social network; I could riff on …. networking, horrible word too.”
* Hollywood: “Margins used to be very good in the movie business. They’re now, what, 4, 5 percent in a decent year, so where’s the joy in that? Is there really a joy in ‘Superman 17′ or “Iron Man 2′?”
* Movie studio executives: “‘Mogul’ is yesterday. It just doesn’t apply. You use the word ‘mogul’ and what you do is conjure up the fantasy, the memory of when there were actual movie moguls who made their decisions, believed in what they did, were outsized personalities. There’s no outsized personalities in the movie business anymore.”
* Indiscriminate spending: “There is a reluctance, even with people who have vast resources. Right now, it just isn’t the order; it isn’t the day. You’re not going to see a birthday party for three million bucks. I don’t care how many billions you have or paying Mick Jagger $3 million to come and sing for your birthday. I notice this with my friend. I just notice this as a condition of this period.”
To hear the always entertaining Diller riff, go ahead and click on the links…
(Photo: Reuters)
72 comments so far
Previous | 4 | 3 | 2 | 1 | Next
Companies also lay-off in anticipation of bad times and to fortify their cash reserves.
- Posted by taskDiller and all of you people are NUTS!
- Posted by Richard LundThe reason the companies are making money in the first place is that they are doing Responsible things such as cutting costs AND cutting jobs in this difficult market so as to maintain profitability. Do you have any idea what those numbers you “throw around” are in terms of percentages of revenue? That is what is important. If 40m is 1% of revenue, cutting costs and jobs IS indeed the responsible thing to do. That company is on the edge of Losing money. Yet you and this genius Diller seem to think that you are smarter than they are; and want to “tell” them what they should do. That is socialism, communism, central planning. I know you don’t like those terms; but they do apply.
[...] media baron Barry Diller is asking profitable companies to pull back on the pink slips. He says, “It’s not that you don’t want to earn as much money as you can — it is your obligation, [...]
- Posted by Swampland - TIME.com » Blog Archive Too Big To Fail «These comments are horrible. Since when is a company obligated to employ a certain amount of people? A company has obligations to its shareholders, NOT to employees. No matter the size of the business or corporation, profit is the goal. Employees have to EARN the right to have a job by producing what is expected of them. It concerns me that so many people commenting here believe that they deserve jobs just because a company makes a certain amount of profit. Welcome to the Obamanation.
- Posted by DasonIn theory, companies have no obligation to their employees and visa versa, except to pay for work and to work for pay. However, since employees are not machines, companies must craft policies to maximize work received from employees and to allow employees to maximize pay received from companies. This is an implied symbiotic relationship. Without this relationship, low employee morale will threaten the viability of the company.
- Posted by JimmyHe is right. It is a socialist mind set, but, those layoffs contribute to the bad economy. It’s short term thinking. If companies making money held strong with less profits then the economy would improve faster. Pay attention, read about Honda’s approach to the last auto crisis. They didn’t lay off people.
- Posted by GeorgeI was pleased to see that he isn’t in favor of layoffs so that a company can make 40 mil in profit rather than 20. That is what he is saying. If your company is turning a profit (but not as much as last year) then you have no business laying people off. Layoffs for the sake of maintaining an already high profit margin is ridiculous. It’s short term, quarterly book cooking. These companies will have to rehire in the next quarter anyways, as they will be understaffed. Finally a CEO with a head on his shoulders. Thanks Barry.
- Posted by GeneBob A the Republosaurus!
Companies do have a responsibility to their shareholders/owners. True. They ALSO have responsibilities to their employees, customers, vendors, and the society they live in, because their actions affect them all. One does NOT take huge precedence over all the others. Employees take no risks? What planet is he from? Diller is a decent human being.
BTW, it’s “oblivion” not “oblivian” - and Obama is simply stating the obvious, that those with more money than they know what to do with can contribute a bit more to support the social structures that enabled their wealth accumulation. It’s “nitwits” not “nit witts,” “affect the middle class” not “effect.”
- Posted by John B.Who the hell is this guy?
- Posted by $[...] Says the Dillster: “The idea of a company that’s earning money, not losing money, that’s not, let’s say ‘industrially endangered,’ to have just cutbacks so they can earn another $12 million or $20 million or $40 million in a year where no one’s counting is really a horrible act when you think about it on every level. First of all, it’s certainly not necessary. It’s doing it at the worst time. It’s throwing people out to a larger, what is inevitably a larger unemployment heap for frankly no good reason.” [...]
- Posted by Barry Diller: Layoffs, Shmayoffs / JossipCompanies don’t care about people only profits. If the CEO made 20 million $$ last year what’s makes you think they would take anything less this year. The real sad part about it is if the CEO does a lousey job he still gets big $$$, were as an employee gets canned. You think Congress and Senators care look at what they get $$ of what we know of, meanig they get money from lobbists special interest etc. When they get caught with money in their freezers they still don’t get booted out. Healthcare for life for them and spouse, great gig.
- Posted by toray99diller speaks for me for shure. he’s not like the babbling idiots who call themselves experts.
http://www.youtube.com/watch...
goldieshouse.piczo.com
- Posted by richWhere was this idiot for the last 15 years when the globalist swine exported every job they could to the third world or today when the conservative politicians daily agenda is to eliminate american workers jobs and praise the socialiized workers of the communist orient. Good luck asking the hollow men of wall street safely handed their bailout without question or hearings to accept a 90% profit rather then the 99% they have with their slave labor,,these types have no nationalism only devotion to their euros safly in their overseas banks
- Posted by mcnertnyI think Diller makes some fine points, in particular that many companies are showing very little imagination and that “laying off” people is way to “pretend” to manage a business in hard times. So much so that Cathie Black, President of Hearst Magazine, recently told a group of industry peers, “We had to lay people off in the last few months, and that’s OK.” “That’s OK,” to my mind an off-the-cuff comment like that reveals a real failure of leadership.
- Posted by RWordplayDiller is right on. Certainly, a struggling company needs to make adjustments in its workforce as needed to fit demand. However, he is talking about layoffs as an easy short term solution to artificially inflate profits in an already profitable company so the fat cats in the board room can continue to increase their already ridiculously inflated salaries, pay themselves 6 figure bonuses, and throw themselves big parties in exotic locals that they fly to in their private jets. Corporate crooks are driving our economy into the ditch and our government is bailing them out. Wake up people.
- Posted by Jeff WBarry the communist! Companies have an obligation to their stock holders or their owners. They are the ones who risked their money and time to start and keep the company running.
Employees are along for the ride. It is in their best interest to make the company profitable. If it is not it means cuts must be made.
Remember, these are the people Obama promised to tax into oblivian. These are the rich Obama and the Democrats hate so much. These are the people who can afford to pay more to our socialist government. THIS WON’T AFFECT YOU MIDDLE CLASS AMERICANS, THE messiah SAID SO.
Now they are cutting your jobs all you Obama nit witts. Just wait until the socialists increase their taxes. DON’T WORRY, THE messiah SAID IT WON’T EFFECT THE MIDDLE CLASS. Welcome to Amerika!
- Posted by Bob AIf you lay off employees now it’s a red flag that your business is failing or will soon in the future.
- Posted by hal halopIt’s not worth firing 10 employees to have a drop in the stock of your company.
IN addition, most of the comments that are bashing Barry Diller are from those who were not on this earth when corporations knew they had a responsibility to more than just their stockholders. There was a time when corporations died after a certain number of years, unless they had the approval of the citizen representatives of that state to continue. Maybe we need to return them to that kind of reponsibility.
- Posted by Don DureauI believe that he is not talking about those about to go out of business, he is talking about corporate responsibility. Corporations have more responsibility other than to their stockholders. Barry is right on and I am proud to call him the Chairman of our corporation.
- Posted by Don DureauAll one has to look at is the oil markets. Did it make sense for oil to be at $147/barrel this past summer? Yes, if you believe in killing the goose that lays the egg (i.e., Consumer spending, especially in America). Yes, Americans are in over our heads with debt. Yes, corporations need to maximize profits. Yes, Yes, Yes. What we’re seeing though is the downside of short term thinking. OPEC/Super Majors/entire oil ecosystem/politicians/Hedge Funds all bought and told bunch of lies to prop up $147/barrel story. Hurricanes? India? China? War on Terrorism? All used to justify jacking up oil to unsustainable rates.
Communism and Socialism are not the long or mid term answers. History has proven this. Free enterprise and Capitalism will win the day. BUT - in times like these, government needs to step up and regulate these markets.
Diller himself has contributed to past hypes (ask.com on part with Google? Please!). But he is right - in current GLOBAL craziness, long term thinkers will reap what they sow. And what we need right now is Long Term Leadership and stability - not short term thinking so that stock price goes up $.10.
- Posted by Texas Horns