MorningBird

Have you seen any good news lately?

Why is bad news more interesting than good news? The local TV news is about fires, rapes and murders—and weather. Have you ever seen anything on a local TV newscast but disasters, criminal events, and weather? (Some would classify weather forecasting as a criminal event.)

And newspapers are no more cheerful. But I’ll cut newspapers some slack on the weather. Your house could blow away before the newspaper arrives, and so we don’t pay much attention to weather reports in the newspaper. But newspapers print the same dreadful news, along with the national dreads, which local TV rarely mentions (the local dreads, the weather and the commercials don’t leave much time for national news on Channel X).

The daily newspaper national news usually includes a mix of sports, business and politics from Washington, London, Sri Lanka, Sao Paolo, and other places we can’t pronounce or locate on a map. Of course if your newspaper is a weekly, the weather section is ludicrous. But weekly newspapers have an especially sobering section that warrants extra space—the obituaries.

We don't pay enough attention to the good stuff. And so, I put together a sampling of news that I think should merit attention. These are listed in no particular order; simply as they fell from my still functioning, 67 year-old, non-Alzheimer affected brain.

Dateline: Durham, NC. "The Duke University Lacrosse team had a 100% graduation rate this year." It's true. Did you know that? We hear a lot about dumb jocks that can’t get to the verb, but not much about student-athletes who go to class, study, and earn a diploma. The Duke Lacrosse Team's academic achievements will be good news for some, but bad news for others; depending on their persuasion about that dreadful event with the dancer.

Dateline: Washington, DC: The National Center for Health Statistics: "In 2002, 2.6 million babies were born to parents with a marriage contract." The report said that another 1.4 million children were born out of wedlock that year. (And 1.4 million were killed in the womb.) Why don’t we celebrate parents who don't kill their babies? I don't care if they have a marriage contract; although I wonder why one would bring a child into this world without a social and legal umbrella. Note: 2002 is the most recent period I could find statistics for. Maybe it's better now.

Dateline: Atlantic City, NJ: "Last night, in Atlantic City, Bill Cosby held forth with two hours of non-profanity laced stories. They were rolling in the aisles." Mr. Cosby is dealing with his own set of dreads at the moment, but we should not forget the wholesome humor he has entertained us with for decades. He is a funny man and he does it without four-letter words.

Dateline: Philadelphia, PA. "Not one Philadelphia city official was indicted yesterday." (OK, I made this one up, but I'm sure there were a few days in the recent past when that statement would have been true.) Unless you live in Philadelphia, you cannot appreciate what a joyous reception that headline would receive. Of course, no one would believe it. Maybe they could run it in the funnies section.

Enough. I don't purposefully watch the local news on TV, but occasionally it drifts into my space, and without exception, I am amazed at the negative content. Maybe I should say the continuity, for it never changes: fires, rapes and murders. Local newspapers are no different; they too headline the dreads.

But the dreads can mean different things to different people. For some, they can be happy events, in a perverse sort of way. Take the NY Times for example. A few weeks ago a low level White House official was convicted of something to do with the Jack Abramoff scandal. You know the guy in Washington who bought off some Republican Congressmen? (They don't tell us that he bought off some Democrats, too.) Anyway this low level White House official got caught with his hand in the cookie jar, or his ass in a G-5, I'm not sure what. I had never heard of him before that event, and I can't remember his name now. I'm sure you can't either. And that's my point. The NY Times had this poor slob's color photo ON THE FRONT PAGE ABOVE THE FOLD, a space normally reserved for stock market crashes, declarations of war, and the death of world leaders. So much for objectivity in the newsroom. I assume this sad event was a happy one for The New York Times. (I'm not taking sides; I could pull a similar story from Fox News.)

This is one--but only one--of the reasons TV, newspapers, and news magazines are threatened. Not because they are partisan, but because they attempt to hide it. The Internet is a refreshing change. Amateur news on the web is unabashedly awash with opinions, and it is delivered head-on, not cloaked in oblique language. It comes from the bottom up, not top down from the editor's desks of the establishment news industry. And it is delivered in real time, not shackled to the 6:00 newscast, or the lumbering printing press.

The rise of the Internet and specifically the blogging format will surely go down as one of the most important events in news gathering history; perhaps all of history. It has liberated thought. Expression is unstructured, even out of control at times; uncontrollable might be a better description. But this medium has revealed some very good thinkers--and exceptional writers. And it has shrunk the world like nothing else in history. The establishment should be worried.

That is the good news.

Whose pipes?

According to Chairman Edward R. Whitacre, "at&t will not give its pipes away."  Mr. Whitacre is a lifelong employee of the old AT&T and the Bell Telephone system, and no doubt (in his mind anyway) his crowning achievement was to put the telephone company back together--at least the parts not owned by Qwest and Verizon, which by-the-way, include MCI, that old Bell nemesis that started this mess back in the last century.

The pipes Mr. Whitacre is referring to are the last mile connections to our houses and places of business, favorite bars and so on.  The last mile is an industry buzzword for the copper wire that connects us to the old telephone network.  I say "old" for even though the telephone network is still the big kahuna for talking and faxing (about 180 million U.S. telephone subscribers use it every day), it is aging fast.  In fact it is technologically dead, a condition that Mr. Whitacre will not admit, for at&t is racing forward with a new hybrid system to transmit voice and data and video that relies on that poor, brittle, slow copper wire for the "last mile."   

Mr. Whitacre does not talk about the miles in between the last miles.  In the last few years, tens of thousands of miles of copper have been replaced by fiber optic cable. More than we need.  There are more unused strands of fiber-optic cable strung around the world than stars in the sky.  And those strands of glass connect population centers all over the world; East, West, North and South; yep it runs under the oceans too.  Compared to copper wire, fiber-optic cable is like a Ferrari is to a Volkswagen Beetle.  It ain't no contest Alice.

Messages race around the world on fiber (and satellite), but when they get to our neighborhoods they screech to a halt and crawl into the house on copper wire.  Mr. Whitacre likes it that way.  Now don't get me wrong; at&t (and Verizon and Qwest) have miles and miles of fiber-optic cable too, but they also have lots of competition for that long haul business.  And so they have staked out the last mile to defend their turfs; not with innovative products and services--no, with money.  Money thrown at the politicians in Washington.

Mr. Whitacre says he paid for that last mile and therefore deserves a decent rate of return on his investment.  (I'll get back to that in a  minute.)  And furthermore, he says, "I'm not going to let my competitors use it for nothing."  He claims to be talking about Yahoo and Google and Microsoft and a hundred other companies that are bringing new and better communications tools for us to use.  But he is really talking about us--the consumers.  He wants to build a fence around that last poor little strand of slow-poke copper and charge extra for certain Internet activity.  at&t can't compete with better products and services and so why not just lock the gate? Of course we, the poor lobby-less consumers, do not have a Congressman hooked on our tool belt, but if we did, we would point out that we already paid for access to our ISP--handsomely in fact, to the tune of $40 per month and up for broadband service.  And our ISP pays for every bit and byte of data that it transmits over Mr. Whitacre's slow poke last mile. 

Now back to Mr. Whitacre's  claim that at&t deserves a decent rate of return on its investment.  Why?  Is Disney guaranteed a decent rate of return when they make a bad movie? Remember the New Coke?  Was Coca-Cola rewarded for that flop?  If you're old enough, you surely remember the Edsel, the largest disaster in automotive history.  Who reimbursed Ford for that fiasco?  If at&t can't make money under the present Internet open source system, step aside.  Who cares if at&t carries Internet traffic or not?  Do you?  I don't?

Mr. Whitacre has worked for a monopoly for so long that he can't stop looking to the government to bail him out.  He's used to bullying his way to success, the consumer be damned. Sadly he has the money to do that in Washington.  But it will be a temporary victory, for the Googles and the Skypes of this new age will surely find a way around Mr. Whitacre's legislative roadblock.  Where will at&t turn then?  Probably to new management; executives seasoned in the rough and tough world of free enterprise.  at&t and the other Bell survivors will have to flush out the current crop of monopolist bred managers, if they are to survive.    

YOU WANT PRIVACY?

I was born into a world of party line telephones.  My family shared a telephone line with our neighbors in a rural community of 1,500 people.  If I wanted to call my friend Jimmy, I walked over to the only phone in the house, removed the earpiece, held it to my ear, and spoke into a microphone located in the base station.  Base station is a 20th Century word, and I use it here, only because I can’t remember what we called that part of the telephone; probably nothing, the whole thing was simply the telephone—and it was big. 

There was no rotary dial and no keypad.  I would listen to see if anyone was on the phone, and when I heard voices, I hung up (most of the time).  But if I recognized one of the voices, I might join the conversation.  If the line was silent, I simply waited for Mabel, the telephone operator, to answer, and then I would say,  “Mabel, would you connect me with Jimmy, please?”  (I had only to use Jimmy’s first name, because Mabel knew that Jimmy Bevans was the only Jimmy in my life.) And depending on Mabel’s mood and workload, I might have a conversation with her, before she connected me to Jimmy’s house.

Then I would listen for two rings that meant the telephone was ringing in the Bevans house. Of course it was also ringing in the other houses that shared that telephone line with Jimmy’s house, but two rings meant it was for the Bevans family, and the other subscribers on that line, were not supposed to pick up.  Most of the time they did not ’t, but you could never be sure.  In that telephone age, privacy was a foreign word. 

It was the 1940’s; America was fighting the largest war in the history of the world and there was no privacy on the telephone, but not because the government was listening—our neighbors were.  And nobody seemed to care.

Later, my family got a private telephone line, which meant two things. 1) When the phone rang, we did not’t have to count the rings; we knew it was for someone in our house, and 2) we knew that nobody was listening to the conversation; not even on another phone in the house, as inside wiring was yet to come.  The introduction of the private telephone line is a forgotten event, buried by the technological Tsunami that engulfed the globe after WW II, but it was a serious milestone, because it extended the intimacy of private conversations beyond the physical realm.

Fast forward to 2006.  Today, we can’t get away from the telephone—ours or someone else’s.   Telecommunications is the new subculture.  Wire line phones, cordless phones, cellular phones, satellite phones, VoIP phones, smart phones, flip phones, throw-a-way phones, family plans, prime-time minutes, weekend rates, ring tones, prepaid plans, roll-over plans, two-year contracts; it can make you dizzy to think about it.

A typical worker in the industrialized world has at least three telephone numbers—and three telephones: a home phone, a cellular phone, and another phone at work. Much of the equipment and the services are incompatible.  For example, cellular phones and land line phones are not interchangeable; they only work on their networks.  And land line service and cellular service—minutes and plans—are contractually dysfunctional.

But that’s only one side of the coin.  Now that the Internet is telephone friendly, the hot buzzword is connectivity. Say what? You only want to talk on your phone?  Get with it, man!  Instant messaging, text messaging, emailing, music downloads, video downloads, built-in cameras and podcasting are the digital telephone’s fast lanes.  And it’s all about sharing: Sharing favorite photos, favorite music, favorite bookmarks, favorite friends, favorite this, favorite that…and we’re concerned about privacy?

Meanwhile, we have Google, Yahoo!, MSN, and this-and-that search engine, all capturing everything about us—forever—including our mobile forays.  Our cookies broadcast every click.

We’ve come full circle, my friends. Welcome back to the party line. 

INVESTING IN A DIGITAL AGE

Dust off my resume, Momma

HEADLINE: “HP's Fiorina Walks Away with $45 Million”

That was the latest headline I read last night; Ms. Fiorina’s kiss-off award is up a mere $24MM from the original $21MM estimate published last week. I didn’t read the fine print, but I think the $45MM was only a near-term projection, and implied that more stock options are over the horizon for the banished Chairwoman. And if the next CEO brings the stock out of the doldrums (something Ms. Fiorina could not do), presumably her options will be worth a lot more. When has ineptness been so rewarding?

This is not a diatribe on Ms Fiorina’s performance (the board decided that), but I couldn’t help but notice that she shepherded a stock worth $40 on the day she became CEO in September 2001 straight downhill to $20 on the day she left the company. I don’t know what they paid her for working there, but can you tell me why she was awarded such an outrageous amount for not working there? Is executive talent in such short supply that HP must pay $45 million for failure? What will they pay for success? Dust off my resume, momma.

I blame the board of directors. Every board member who signed-off on Carly’s pre-nuptial unemployment contract should resign. Thank God, I"m not an HP shareowner, but if I were, I would be hunting for scalps.