2001’s Merger Scorecard
TheOnion.com, the satirical online weekly that often captures through grandiose exaggeration of life’s mundanities the precise ridiculousness of passing news moments, once ran an observant headline: “Just Six Corporations Remain.”
To those who don’t follow every move in these corporate gobblings, that assertion has seemed too true in recent weeks. Company couplings are down slightly this year (about 8,040 in 2001 versus 10,800 in 2000), but the perceived scale is larger. How many more huge companies can get huger?
You’ve got your French water company buying a movie studio from a liquor company and acquiring a TV network while investing in a satellite TV provider begun from a pickup truck now buying, for $25 billion, the other satellite company with its own metal planets orbiting Earth.
Ah, then along comes a family cable TV outfit that started with 1,200 customers in Tupelo, Miss., and somehow found $52 billion--that’s larger, by the way, than Poland’s government budget--to buy just the cable TV part of AT&T.; Remember AT&T;, the giant sliced apart years ago by a Solomonic federal judge unaware that immensity, like the Terminator, would be back? Experts think AT&T;’s telephone leftovers will be re-agglomerated soon by one piece sundered from the parent. Can companies be Oedipal?
There should be a James Bond-scale villain in all this, someone quite mad in an isolated mountain redoubt, bent on controlling the ozone layer with satellite rays and a private army in nifty uniforms. Only such incomprehensible wealth grasps the multimultibillion-dollar merger prices these days. (We disclose here that Tribune Co., this newspaper’s owner, isn’t exactly a ma-and-pa outfit.)
Do mega-merger maneuvers matter to real people who must consult their wallets before ordering at Starbuck’s? Corporate egos clashing in public is great entertainment, like squabbling movie stars without the meticulously messy hairdos. Regulatory inquiries provide further fodder for debate, controversy and a gauge to political attitudes. Competitive pricing might matter if one single American ever actually stopped watching TV over a $1.50 cable increase or tracked his Anytime Minutes. And program diversity, if not quality, actually seems to increase as owners decrease; no channel shortage yet. Next, a Merger Channel?
Wait a minute. This could make the plot for a blockbuster movie produced by one of the international corporations conspiring to control the world’s communications and entertainment industries about an international corporation conspiring to control the world’s communications and entertainment industries. They’ll make mega-money to finance future mega-mergers by telling the story of what they’re actually doing in current mega-mergers. Talk about financial synergy.
