“NBC is an AT&T Sock Puppet”

Terry Heaton:

How do I say it more clearly? Honestly, folks, we need better leadership than this in the seats of media power, and until that happens, we’ll just continue to miss the point, over and over and over again.
At an anti-piracy summit in Washington Wednesday, NBC’s Jeff Zucker actually called for AT&T and other Internet-service providers to install filtering software to, and get this, “weed out pirated content and unclog networks.” This is one of the most dangerous and desperate things I’ve ever heard come out of the mouth of someone who, among other things, is charged with certain responsibilities vis-a-vis the First Amendment. And the REAL PROBLEM is that this line was likely penned by the Telcos, not Zucker or his writers. I mean, come on! “Unclog networks?” Where have we heard that before?
AT&T would LOVE to filter the Web.

Has Managerial Capitalism Peaked?

Jim Heskett:

There is a growing call for a redress of the imbalance between what John Bogle terms managerial capitalism and owners’ capitalism. Bogle describes owners’ capitalism in his book, The Battle for the Soul of Capitalism, as “an enormous transfer of wealth from public investors to the hands of business leaders, corporate insiders, and financial intermediaries.”
Headlines remind us of very large payouts to CEOs, regardless of their performance. (In fact, it could be argued that in many cases, payouts are inverse to success, since many have been occasioned by the firing of the recipients.) Some critics contend that managers have received a disproportionate share of the fruits of corporate success, leaving too little for workers or owners. Even hedge funds have been derided as better management compensation devices than investment vehicles.
What’s the reason for these phenomena? According to one report, Michael Jensen and Kevin Murphy, in a book to be published in the next several months, C.E.O. Pay and What to Do About It, lay much of the blame at the feet of boards of directors. They claim that CEOs in public companies should be answerable to directors for poor performance but in fact are not. Directors, representing an indirect form of governance, are poor representatives of owners. They are far too lax in influencing employment contracts and management incentives. The options they grant are too generous and fail to take into account the cost of capital employed during the term of the option. The severance payment arrangements to which they agree are too lavish, regardless of the reasons for severance.