Monthly Archives: April 2012

Andrew Hill

There’s a famous scene in The Devil Wears Prada where Meryl Streep, as the terrifying editor of a Vogue-like fashion magazine, lectures dowdily dressed Anne Hathaway on the way her “lumpy blue sweater” is, in fact, distantly influenced by the catwalk collections of Oscar de la Renta and Yves St Laurent.

In the same way, are the recent votes of institutional shareholders against executive pay somehow an echo of the Occupy movement’s vocal, if ill-focused, protests, from Wall Street to the City of London?

I think they are. But it suits both sides to disagree, even if the most productive changes in the way capitalism has historically functioned might be achieved by greater engagement. Read more

John Gapper

The Rupert Murdoch on the witness stand for day two of his evidence to the Leveson inquiry was less impressive than the Murdoch of day one.

After his halting testimony to a House of Commons last July, he was refreshingly on form on Wednesday – coming out punching with a display of crisp, sharp replies, even if quite a few were implausible (as I discussed in my column).

Matthew Engel summarised his performance nicely in the FT:

Ga-ga? Rupert? Eyes bright, sharp as a tack – and in control of the situation. “I hope I’m like that at 81,” said a young man in the public gallery. Normally a barrister on his feet cuts an intimidatory figure when cross-examining a seated witness. This time Mr Jay looked like a supplicant backing away from the boss’s desk.

But Mr Murdoch sounded slower and more tired on Thursday, hesitating longer over his replies and sometimes rambling. His reply to a question about his suggestions for media regulation went on a long time and had various digressions. Read more

Lord Leveson’s inquiry into the British press on Wednesday tackled one of the most pressing mysteries facing government and the media: how on earth does Rupert Murdoch ever get anything done?

Andrew Hill

The greenest job applicants know that to make any sort of impression on their prospective employer they must at least know something about the company where they wish to work and the position for which they’re pitching. That lesson appears to have been lost, however, on many of the experienced hands seeking to join the boards of Britain’s financial companies.

Hector Sants – outgoing chief executive of Britain’s Financial Services Authority – used his valedictory speech on Tuesday to underline how would-be directors are failing even the most basic examination of their credentials for high office. Read more

John Gapper

James Murdoch faces tough questioning at the Leveson Inquiry. Getty Images

James Murdoch faces tough questioning at the Leveson Inquiry. Getty Images

The Leveson inquiry has finally arrived at the heart of an issue that has long bedevilled the UK media and political establishment – do newspaper proprietors get favourable treatment in business in return for supporting politicians?

James Murdoch, now the deputy chief operating officer of News Corporation, insisted angrily that he expected no more from politicians reviewing News Corp’s bid for the rest of the equity in British Sky Broadcasting in 2010 than to play it straight down the line:

In response to a suggestion from Robert Jay, counsel to the inquiry, that News Corp had courted Jeremy Hunt, the culture secretary, to get the bid through, he replied:

“That is absolutely not the case. Any question of support from a newspaper for one individual politician or another would never be linked to a commercial transaction… I simply wouldn’t do business in that way.”

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It’s not that they’re wicked or naturally bad
It’s knowing they’re foreign that makes them so mad!

– ‘A Song of Patriotic Prejudice’

Flanders and Swann, the English songwriters whose 1960s ditty gently ribbed nationalists and national stereotypes, would have had a field day last week. Canadian Mark Carney was added to the list of candidates to become the next governor of the Bank of England, prompting this priceless, po-faced observation from one of the central banker’s supporters: “As a Canadian national he is a subject of the Queen. That is important.”

Andrew Hill

In the 1980s, British radio presenter Steve Wright used to stage phone-ins to his show from a ranting imaginary listener, “Mr Angry from Purley”.

Well, the phone lines from Purley are burning up, judging from some of the reactions to Vodafone’s agreed £1bn cash takeover of Cable & Wireless Worldwide, which was created by the demerger from Cable & Wireless in 2010. It’s rare to find a deal that has got up so many people’s noses.

CWC:LSE

Underwater: C&W – privatisation to demerger*

Investors may be happy with a 38p-a-share bid, compared with the 19.8p at which CW&W stock languished in February before an approach was made. But they are angry about the drop in CW&W’s share price since demerger, and those who enjoyed the growth spurt of the late 1990s are even angrier about the overall decline of the once-mighty Cable & Wireless group, a descendant of the Victorian consortium that laid the first submarine cable across the Atlantic . One City fund manager told the FT recently that Cable & Wireless Group was “the worst stock he ever bought“. Read more

John Gapper

Fred Wilson, the venture capitalist who is a mainstay of New York internet start-ups, has some provocative thoughts on the lifecycle of web and mobile apps – that their lifecycles are similar to those of hit television shows:

“This round trip from nothing to everything to nothing again is also true at some level with many tech companies. Digtal Equipment Corporation was founded in 1957 and shuttered in 1998. RIM was founded in 1984 and in all liklihood will be gone before the end of this decade. Same with Sun Microsystems, Silicon Graphics, and many more iconic tech companies.”

As he says, the networks effects that work in favour of social networks on the way up can also turn against them:

“Network effects are powerful in both directions. They can help you grow exponentially. But when they are going against you, they work just as fast. Myspace’s decline was mind-blowingly quick. RIM’s has been as well. Who is next?”

 Read more