APRIL 27, 2003
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Q&A: Charles J. Fombrun
"There is a direct correlation between reputation and market capitalisation. Reputation has to be treated as an asset, measured as an asset." Thus spake Charles J. Fombrun, reputation guru, Professor at New York University's Stern School of Business, and Founding Director of the Reputation Institute. For more, log on.


Q&A: Keith Smith
Keith Smith—not to be confused with a Hot Springs Arkansas-based egg marketer by the same name—lives in Hong Kong, as the boss of an idea-hatchery. More specifically, as the Regional Chairman of the Asia pacific operations of TBWA. His most significant 'business coup'? Swinging the Wonderbra account.

More Net Specials
Business Today,  April 13, 2003
 
 
Law And Orders
It's not just small businesses who flout the law to promote their causes.

As I write this, a little-known us firm called Halliburton has just been awarded a contract worth over $1 billion (Rs 4,800 crore) to rebuild some part of destroyed Iraq.

A few curiosities, though. One, that Halliburton is awarded the job even though it's teetering on the edge of bankruptcy. Two, that it gets chosen in a 'secret' process, where no other bidders are even asked to present proposals. And three, curiouser and curiouser, as Alice would say, Halliburton is still paying annual compensation to its former chief executive officer Dick Cheney, the current Vice President of the US. When everyone's talking about the 'conflict', shouldn't we also talk of 'interest'?

   
   

All this from an administration that recently made loud, sobbing noises about ethics and corporate governance. A few more dots become visible, I connect them. I read of a Senator from Southern California who tables a bill mandating that when Iraq's mobile telecom services are re-built, they should not use the GSM platform that Iraq and the rest of the Asian world have been using till now, but pick instead a less-popular technology called CDMA.

There's not really much to choose between these two technologies, except that an overwhelming majority of the world uses the GSM standard. Orders for CDMA will result in royalties accruing to Qualcomm, which just happens to be located in southern California. Qualcomm, in a fit of reluctant honesty, concedes that it has been paying lobbyists to promote its cause with cash-hungry US politicians.

Is there something in CDMA that requires skull-duggery to sell it? Back in India, its biggest backer, Reliance got permission to provide local services, and then went ahead and announced mobile roaming services that it never paid licence fees for, unlike the other GSM operators in the country.

Such deviousness often backfires. Qualcomm and Halliburton can learn from the UK experience. In the weeks before Hong Kong was handed over to the Chinese authorities in 1997, the British handed over the construction contracts for airport and bridges to little-known UK construction companies, in preference to larger, more experienced firms who bid lower. The Chinese protested-and gritted their teeth. Sure enough, post-takeover, those firms found themselves almost completely sidelined when it came to the bigger business inside China. Does Qualcomm really think it's gaining brownie points with its ham-handed efforts to buy its way into the spoils of the Iraq war? Do you think the rest of the Arab world will welcome Qualcomm with open arms?

It isn't just the technology-driven businesses that are playing this game. Take the case of broadcasting major NBC, which is owned by General Electric. They go and fire their anchor Peter Arnett because he, to quote, "offers an opinion" in an interview to Iraq television. I wasn't aware that US media people were not supposed to have opinions. Even opinions as harmless as thinking that the US is finding the Iraq operation more difficult than it originally thought it would be. Something even a cerebral amputee would agree with today-though, not, in this case, the scared old men at NBC who begged and asked "How high?" when the Pentagon said "Jump!"

The ease of buying off news organisations surprises me. Virtually 100 per cent of the western world's journalists are now, to use that word reminiscent of parasitism, 'embedded' into US and UK armed forces, and hence report the US and UK point of view. Which includes showing Iraqi prisoners of war and generally furthering the propaganda that the good guys aren't suffering casualties, while the bad guys are on the run.

So when non-Western journalists (gosh, you mean they can report? Handle a camera? How did they learn that??) show American prisoners of war, it's suddenly wrong and a breach of the particular Geneva convention that the US didn't want to sign.

I'm waiting for the time when newspapers forget journalism, ask you what events you want to have covered, and charge you to write it up and print it.

Oh wait, hasn't The Times of India already gotten to that?


Mahesh Murthy, an angel investor, heads Passionfund. He earlier ran Channel V and, before that, helped launch Yahoo! and Amazon at a Valley-based interactive marketing firm. Reach him at Mahesh@passionfund.com.

 

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