Measuring Up

The pot calling the kettle black

Ever notice how many famous (or highly regarded) public figures who go through scandals (or are disgraced) rehabilitate their image only to jump right back into the spotlight a few years later? I’ve always been intrigued with the ease that most gain acceptance. And, although their lapses aren’t forgotten… typically they are forgiven.

Don’t get me wrong. In many cases, these former politicians, dignitaries or celebrities come back even stronger and have every right to do so because their new found visibility has little to do with past crimes or indiscretions. One case in point is Martha Stewart. Martha went to jail for insider trading (actually the official crime was lying to the government.) With her jail term served, those who cherished Martha’s wise home living advice and tips before, accepted her quite affectionately again by enthusiastically watching her shows, reading her magazines and books and maintaining their overall fan status.

Take a look at Eliot Spitzer and we see a completely different scenario, albeit an interesting storyline. It wasn’t so long ago that the former Governor of New York went through this state’s largest political scandal in recent history when the news broke that he was caught red handed frolicking with an expensive call girl. The governor quickly resigned from office and then created his own Richard Nixon-like, self exile scenario. We thought that would be the last of Mr. Spitzer, until 18 months later when he appeared on many talk shows to offer his very relevant commentary on the plummeting financial markets and Wall Street’s blame in the economic disaster that had resulted. Yes, people were shocked to see the disgraced governor in the spotlight again. Some were even outraged. Yet, in the end, this was most likely the smartest move Mr. Spitzer could have made to rehabilitate his image because the only positive and credible piece of his reputation that still existed was forged over a 12 year period as having an Elliot Ness approach to fighting Wall Street corruption and greed by standing up for all those ‘little people’ who needed to be protected.    

Then, there exists a few hypocrisies that I simply don’t understand. These include real life examples of larger than life successful people who fell from grace because of some misdeed, or simply because their success was built on a lie. Yet, somehow, they managed to come back in the most credible and public way to provide counsel or advice on the very same issues or manners that caused the controversy in the first place. One such example I’m thinking of is the former dot.com super star analyst Henry Blodget.

Do you remember Henry? I certainly do. Think back to 1998 or 1999. This young buck was seen as a God within the investment/technology community for his outlandish Internet investment picks. At that time he worked at Merrill Lynch and instantly reached star status after predicting that Amazon would rise to become a $400 stock (which it actually did.) Every technology or Internet company wanted to get on the radar screen of young Henry after that. He was paid at the highest Wall Street levels, treated like a rock star in all public circles and seen as a new sage on Wall Street. This all worked beautifully well until the Internet bubble busted and it was later found out that Henry and others from Merrill’s research/analyst department were conducting questionable activities within the firm.  He was sharing information (and more importantly) helping Merrill’s investment banking customers prosper by writing favorable financial reports on questionable business models. The Wall Street Chinese Wall relationship between research and investment banking was torn down because Henry (and others) helped Merrill make lots of money through these investment banking relationships at the expense of individual investors. In return, top analysts like Henry also received special early investment considerations into a number of the firm’s hot IPOs.

In the end, Henry’s picks all went south and his conflicted relationship within Merrill caused then New York State Attorney General to investigate him. Though he wasn’t ever convicted of anything, Henry was later barred from the securities industry and paid a fine of $2 million.

That’s why it makes no sense to me and truly comes across as the ultimate hypocrisy when I see that Henry is a top anchor and host on “Tech Ticker,” a heavily watched Internet news segment which dissects and analyzes the latest developments on Wall Street and within the technology world. I’ve watched these videos for over a year. While they are entertaining, it’s absurd that Henry actually plays the ‘heavy,’ watchdog role at times by beating up Wall Street executives and their companies for having ethical lapses and questionable judgment.

I’m not sure how Henry could be seen as credible by any audience on this topic based on a history laced with suspect decisions himself. Talk about the worst case of the pot calling the kettle black…

All the news that isn't fit to be relevant

Check out this photo. You see it, and, of course, you're led to believe that because these two Phillies are high fiving, their team won the World Series game on Saturday night. Right?

Not so. That high five took place in the early innings when the Phillies advanced to take a 2-0 lead. In the end, the Yanks caught up and won the game. Too bad the New York Times sports writer and photographer had probably already gone to bed, though. If someone had stayed to report the full game, we might be viewing a different photo.

This is just bad journalism. I rarely ever say or write this about The New York Times. But, it's Sports section has always been a cut below standard. Although there is some small print below the photo which tells the reader to go to NYTimes.com for the latest news. No reader wants to be unintentionally misled about the game results (a pretty important game) with the largest photo on the front page.

For years, The Times advertised that it had the best sports section around. What a crock that is. Yes, the articles are well written and the section does provide the reader with lots of important statistics and data. But, one area it always failed miserably in is providing the most recent, relevant news, like other rival papers do. And, I for one, have always had a problem with that.

In this case, it would have simply been better to not put any World Series photo front and center on the cover page. At least it wouldn't be wrong.

I never understood why this paper can't find a way to report any game played late at night in the next morning's paper. I guess with shrinking staffs and resources, this reality will never change. That's life. I just hope The Times understands when news isn't reported the next morning, it isn't really news at all.

This isn’t your grandfather’s Holiday Inn

I’ve kind of noticed how Holiday Inn is now making a concerted effort to reshape its brand image. You may have seen it too. The 50+ year old global hotel chain has refreshed a very tired brand logo (hadn’t been touched in 50 years,) has a new advertising campaign and is supposedly going through a complete makeover to recast itself from being a lower end, shabby, inexpensive lodging to one that will be considered friendlier, higher scale and a much more vibrant hotel choice for the next decade.

Analogies typically work well in these cases. I think Holiday Inn’s management is doing its best to crawl out of the basement of lower end hotels (I.e., Days Inn, Comfort Inn, etc.) by attempting to nicely situate itself in the company of the mid to higher end Marriotts.

Frankly, I wasn’t buying it. Over the last 35 years, I’ve watched this chain fall from grace. To me, it takes a hell of a lot more than new marketing and service guarantees to make good on an entirely new brand promise.

Then, I actually stayed at a Holiday Inn in Boca Raton, Florida (sorry to show that I am a snob, but I never do this.) I was more than pleasantly surprised with the experience and have to say that I’m on my way to becoming a converted man.

For starters, let’s talk about how I was greeted in the lobby. The man behind the desk actually came out to grab my bag and meet me with a handshake and a very warm smile. The lobby (by the way) had clearly been remodeled. No more old 70ish décor. Now, it felt vibrant with bright colors, new furniture and the overall décor screamed, we are different! Next, to my room. I walked in expecting the typical double beds, old warn out comforters, small, ugly bathrooms, etc. That just wasn’t the case. Instead, I actually did feel like I was in a higher end Wyndham or Marriott. The room was larger, had signature new bedding, a stylish bathroom with real granite, central air (believe it or not, that’s a perk typically in these hotels), nice furniture and even a mini bar (which really shocked the socks off of me.) I was very impressed and would have been just fine at that stage, but they gave me even more. A fairly high end fitness center was located on the floor below (previously unheard of) and the restaurant food was very good (seafood of course.)

I left this hotel feeling pretty damn good. But, as I started to write about it in this post, I realized that this one Holiday Inn could be an anomaly. Before putting pen to paper, I thought it would be a smart idea to find out if others have had similar experiences (or not). Quite simply, is the new brand promise really living up to expectations? According to the minimal qualitative research (uh…those would be phone call conversations with friends), the answer is yes. Two friends have stayed at the Holiday Inn in Lake George, NY. They loved it. Said it felt like a resort (you just don’t hear that about Holiday Inn). Two other friends had very good experiences at the Holiday Inn in SoHo, NYC and in Philadelphia.  

There you have it. While my research is far from being scientific or verifiable, one thing is clear. Holiday Inn is changing for the better. This just isn’t your grandfather’s Holiday Inn any more.

 

 

AIG just doesn’t give two sh*ts

When I first heard yesterday about how AIG had handed out $165 million in new bonuses, I thought it had to be a joke. Then, I knew it wasn’t, when I saw this article.

As a public relations practitioner, my first thought was – how could AIG have screwed up so badly again? Yet another body blow to a company that is hated, laughed at and is considered to be an almost unbelievable business case example of what is wrong today.

I mean… it’s CEO, Edward Liddy, concocted two reasons for the bonus hand outs that are simply implausible based on the situation our economy is in and based on who actually owns this insurance giant now.  They are:

Point #1 – AIG is contractually bound to pay these bonuses or the company will be sued.

Answer #1 – Ok, you are right Mr. CEO. AIG might be sued if these bonuses aren’t paid. But, who cares? We are living in unprecedented times. And, these times call for unprecedented actions. The fact is that if the government didn’t step in THREE times to pour billions of $$$ into AIG, the company would be bankrupt. Do you know what that means? There would be no money to pay bonuses anyway. Now, the public owns 80 percent of your company. So, much like the automakers did (can’t believe I’m saying something positive about this group,) all existing contracts/agreements and any other special considerations should have been considered null and void. Because the only thing that matters is the company’s survival. Not, whether it’s executives (many who helped AIG lose billions) continue to get rich. Bottom line – the bonuses were just plain wrong and are clearly a public relations tsunami.

Point #2 – AIG has to pay these bonuses to retain talent or they will leave for competitors.

Answer #2 – I have one question for you, Mr. Liddy. Where will they go? Last I checked, Wall Street has shredded over 400,000 jobs. Financial firms, insurance companies and everyone else in the industry are still laying off thousands. I’m really curious on this one– what other competitive jobs exist right now that will take in these high priced senior executives (many who have egg on their faces)? That’s right. It just doesn’t add up because there are no jobs to be had. And because of that, there is no credibility in this message.

Let’s get back to my original premise above. It took me a while (sorry, sometimes I am slow to see the obvious,) but now I get it. This really isn’t a public relations blunder for AIG, because AIG doesn’t care about its public image at all. That’s the only conclusion I can come to now. Over the last seven months, the company has continued to make mistake after mistake, with each one growing noticeably larger in the public’s eye. The most recent disaster was handled in such an amateurish way (the contents of the letter sent to our current Treasury Secretary,) that it’s almost inconceivable to me that AIG’s senior management  is even attempting to rebuild faith with the public or any of its key stakeholders (except those who received big bonuses, of course.)

Let’s keep our eyes wide open as to what comes next. With the President, Congress and the AG all swooping in, I think this might be the last mistake this now cartoonish looking company will be allowed to make.

How Much Does $18 Billion Really Cost

Last week’s news that Wall Street parceled out about $18 billion in bonuses more than incensed Americans and their legislators.

There’s no doubt that from a pure public relations standpoint, this collective hand out was really stupid. Do these CEOs have amnesia? It wasn’t 60 days ago when a civil war like- battle erupted pinning “Main Street against Wall Street” as the Treasury Department (lead by then secretary Hank Paulson) pleaded for Congress to write a $700 billion dollar check to bail out many failing financial institutions. To offer up bonuses to many in the rank and file so soon after this near death disaster, makes little sense and has certainly killed any lingering positive (or even neutral) perceptions about Wall Street that could have existed among the American people. No doubt, it will take a long time for trust to be rebuilt and any forthcoming bailout money will be scrutinized by Congress like never before.

But, putting aside this public relations nightmare (for a second), did Wall Street firms actually do anything wrong by letting many take home end of the year bonuses? I’d say that there is no cumulative black and white answer, just a lot of shades of gray.

Let’s talk about the clear negatives first.

-    Bankruptcy versus Bailout – The most iron clad point against Wall Street (in my mind) is that firms like Citi Group, AIG, Wachovia, Merrill Lynch and many other smaller ones were one step removed from going under. The government had to step in to either directly provide financing or help more solvent banks buy up these terminal companies so that they wouldn’t fail. If these companies had gone bankrupt, I can assure you that any bonus pool would have been close to zero. So basically, many of them financed the bonus compensation for their employees with government…uh…make that tax payer money instead of using the full sum to become “healthier.”

That is just deceptive and wrong. The firms/banks that fall into this category should be punished now.

-    Public companies – how can they justify? – The other argument I’d like to make is that many of these bailed out firms are public entities. So, while their stocks have lost 75-90 percent (in most cases), senior management still found a way to reward many through undeserved bonuses. Public companies serve shareholders first (not employees). Employees of public companies share the risk when their organization has a bad (or in this case God awful) year. Even if some departments within a particular area of a bank do well, that really should have little bearing on how compensation is doled out when the organization has made such fatal business decisions, wiping away untold amounts of shareholder equity.

Now, here’s the gray:

-    Many companies aren’t included in this bad lot and shouldn’t be – My bet is that there are a lot of mid-sized and smaller financial services players who didn’t receive bail out money and whose organizations weren’t close to failing (like those mentioned above). I actually know a few of them. Of course, propaganda isn’t pretty and all of Wall Street has been demonized through the president’s well calculated comments last week. If the average Wall Street bonus is about $110,000,  it’s important to keep in mind that the lesser known (and less publicized) firms handed out smaller sums of money that probably fell within acceptable ranges based on the fact that these organizations deserved them.

-    Bonuses are actually part of overall compensation – This is true. In fact, there are a lot of investment bankers who might make approximately $200,000 salary and then another $5 million (or more) in bonus money every year. Now, cry me a river for those bankers…because no one really cares. And again, if their banks are among those that made terrible business decisions and took tax payer money to survive, then they should just be glad that they still even have jobs moving forward.

Where I see gray are those smaller bonuses (like below six figures) handed out to lower rank and file employees from the healthier firms who depend on that money to live very average lives. Without them, their pay may be too low to adequately pay monthly bills while living in or around New York City.

In the end, my brief analysis doesn’t really matter because public perception of Wall Street is as negative as I’ve ever seen it. Ironically, most firms don’t hand out bonuses until February or March (kind of makes you wonder why so many banks snuck them in early this year, eh?). State and federal politicians, prosecutors, the media and consumers-at-large are downright angry. And, many smell blood in the air. I’d say that this collective $18 billion bonus pool is but a fraction of the real cost that this industry will be reeling from for years to come.

Status symbol or just vehicle for transportation?

The Big-3 automakers are still stuck in the middle of no-man’s land. Although Ford has essentially pulled out of the running for government financing, GM and Chrysler could go bankrupt very soon if the current administration doesn’t step in with a rescue plan.

I’ve read/watched many financial experts debate this issue.  The bankruptcy advocates typically have a myopic focus– they believe that this will provide GM/Chrysler with a “clean slate,” allowing them to wipe debt away and renegotiate so many onerous deals with unions, vendors and others that have hurt the companies so badly. The naysayers (on the other hand) seem to spend most of their time hitting the major (and obvious) point that bankruptcy will create a serious domino effect, forcing thousands of suppliers to go out of business. This, in turn, will ricochet back to all the car companies who won’t be able to buy parts for their vehicles. Ultimately, this would create millions of more lost jobs at the worst of times.

Both points of view have merit. Surprisingly, I’ve only read a few articles focusing on what I believe is a critical point in this giant mess– brand appeal.

I remember reading a survey a few years back in Brand Week which asked consumers of all demographic types what is the number one factor in selecting their automobile. More than nine out of ten answered brand appeal (that stuck out in my mind). The survey did a good job of digging deeper by asking these same respondents why brand is so important. The response by most (sorry, I forgot the statistic) was that it made them feel good about themselves as it was perceived to be a status symbol.

Consumer marketers have always understood these points. But, I’m not sure that those who are advocating bankruptcy for GM and Chrysler do. I’ve argued in past blogs that the Big-3 made their messy beds and now we should let each lie in them (by letting those who can’t survive go bankrupt.) But, on the flip side, I also believe that the negative connotation associated with bankruptcy will prove incredibly damaging to a number of mid to higher end automotive brands, especially in this economy.

Think about those who purchase a Cadillac, or more specifically, an Escalade. These consumers are typically urban, affluent and everything they wear, drive or purchase is focused on the status of success. Do you think most Escalade customers will continue their love affair with this brand when it is equated to the exact opposite, failure? I highly doubt it.

Of course, most brands from these manufacturers are designed for middle and lower classes. And, in this economy, price will certainly trump other features. Still, consumers representing all income levels are clearly in the “driver’s seat” when it comes to the car and type of deal they select these days. I think that a bankrupt GM will push many to select a Honda Accord versus a Saturn the next time around. And, the same goes for choosing the Nissan Altima instead of the Chrysler LeBaron if this company fares the same. By allowing these companies to fall into Chapter 11, their brands will be considered by many to be bankrupt as well.

When the trust is gone...

Bernard Madoff led the ultimate deception to cap off what could be the rockiest three month wallop to investor confidence in 80 years.

This pillar of the financial and philanthropic community has ravaged so many unsuspecting clients. Some are among the "who's who" of the rich and powerful. Others are ordinary working people who lost portfolios encompassing their entire hard worked life savings. And sadly, a few are charities who may have to shutter their doors now. While all the details have yet to emerge, one thing is clear. This man may go down in history as the most talented huckster to ever hit Wall Street.

I know a hedge fund manager who was duped by Madoff. He now counts himself among the millions of walking wounded who have been pulverized for one reason or another during this three month stretch. I finally spoke to him yesterday. His sobering comment to me was, "Ed, everyone had the ultimate faith in this salt of the earth man. I would have believed that the Pope would have scammed us before Madoff. Who can we trust now?"

And that's the $64,000 question, isn't it.

Two things are givens. Americans have short memories. And, they tend to be very resilient (probably in part because they do their best to forget those negatives.) But, in the near term, none of this really helps.

The trust is gone. I've heard one typically positive retiree (who lost 40 percent of his savings to the general market plummet) tell me that he is in utter shock. He's glad that he'll never be forced again to deal with our investment cycle. And, he’d never want to be standing in "my shoes" again (he meant 40 years old) because the system just isn't fair. He has lost heart and all faith.

Financial services firms continue to advertise, telling the world they can be trusted. Media consistently churn out articles such as the "5 or 10 steps" people need to take to make money now or retire with security. And, brokers are attempting to regain their composure by confidently telling clients what sectors they need to have their money in because "it will rise again."

But, most people are past the point of listening because almost no one, in any position, is believable today.

So, how can this trust be rebuilt? Well, the obvious answer is that it will take the resurgence of a positive economy (and stock market.) Once that happens, those short memories will fade further as investors are barraged with advice, marketing and sales pitches on how they can once again prosper. Good times breed confidence and the belief in more opportunity.

But until that happens, individual investors need straight, transparent communications from those would be advisors who might normally shy away from these most difficult topics. In some ways, there is no such thing as providing too much disclosure on facts or communications about issues that do (or don't exist) in this tumultuous period. There's an extremely large dose of paranoia running wild right now. Based on the Madoff crisis, that isn't all bad. Advisors who were once "trusted," need to anticipate doubts and open up their world to be believed (all over again) or they may find that many of their clients will terminate accounts and stash their savings in the only place that feels safe right now. Under the mattress.

Mastering the art of public relations is critical to Big-Three’s survival now

The big three automakers are in a terrible predicament. They can’t sell cars. Their bloated union contracts have forced billions of $$$ of hardship costs on the companies. And, their failure to innovate ahead of the curve has made each come close to complete failure.  Most of the malfunction that exists can be pinpointed on poor management decisions, lack of execution, inability to connect R&D all the way through to sales and other business related issues.

Yet, I find it quite ironic that the current fate of the Big-Three now largely depends upon how savvy each can become operating within a public relations fish bowl. Legislators, investors, consumers, the media and everyone else are all focusing in on every superficial move that each company CEO (and senior management) makes. When the three CEOs showed utter stupidity by each flying their own corporate jet to the first Congressional hearing and then not having any coherent plan as to how the bailout money would be spent, Congress sent them packing. Each looked like the kid who was thrown out of class for goofing off and still isn’t being allowed back in because of bad behavior.

But, it got worse. Much worse. None of the three corporate leaders made any sort of contrite statement during this same trip to Congress. Instead, they blamed their woes singularly on the current financial crisis. This public relations blunder made Congress (and everyone else watching) feel that these three amigos were living in a fantasy world. It also came across as quite arrogant and unbelievable.

Those superficial, yet quite consequential public relations gaffes almost killed all three of these companies. At the very least, they made all of us ridicule the American automotive manufacturers that much more. And, most importantly, made us feel zero sympathy at a time when each absolutely needed to be building up as much public support as possible.

You see, much like what happened before the initial Wall Street bail out, each member of Congress is still very concerned with how his/her constituents will feel about any vote to bail out these fallen titans of business. Yes, to some degree, the economics of the situation will play a key role in their decisions (i.e. how will two million added lost jobs hurt our economy? and even with the new infusion of cash, can these companies really regain any competitiveness?). But, I believe that as public perceptions change, so will the agendas of their legislators. And, that will impact so many decisions to questions that still haven’t been thought through or acted on yet. A few include: How much of a bailout will they receive? For how long will it last? How will they be monitored once the money is provided? What rules and punishments are attached to this taxpayer hand out? Who will be steering the ship once the money is received? What happens when the next CEO makes a stupid PR move?

It’s nice to see that senior management has begun to learn from their earlier PR mistakes (although, there really was no choice.) Each drove hybrids all the way to Capitol Hill. They also admitted that mistakes were made throughout the last few years which led to the current fiasco. And, they came armed with plans on how the proposed bail out money will be spent. I know there will be more PR blunders over the next weeks and months. It’s just an inevitable reality for these companies that aren’t used to being watched 24/7 and never really cared about their own public personas to this degree. But, I hope for their sake that each is scrutinizing every decision and move from a “what will the public think?” standpoint. Or, I do believe that the negative impact of poor public relations could serve to finally take these companies down.

New Yorkers hate "me, myself and I"

Stephon Marbury, the New York Knicks crest fallen star, has shown once again that he is one of the most selfish athletes to ever don a New York sports uniform. Unfortunately for this egomaniacal enigmatic point guard, he's also simply incapable of rebuilding his toxic image, even when the opportunity to shine is smacking him right in the face.

For those who aren't Knicks' fans, Marbury's latest (and most likely last) fall from grace is an important lesson in the importance of being professional and "doing the right thing," even under the most adverse conditions, when emotion and pride are compelling one to do just the opposite.

Here are the facts of this story:

* The Knicks hired a new general manager and coach this year
* The coach (Mike D'Antoni) quickly decided that Stephon Marbury wasn’t in his short or long term plans and ceremoniously benched him (and didn’t even ask him to dress on some days)
* This isn't a surprise because Marbury has a long standing reputation for being selfish and is a career loser with every one of his NBA teams (including one that D'Antoni coached)
* Marbury watched and waited. To his credit, he didn’t complain publicly and "dealt" with the situation. All the while, the Knicks aren't discussing whether they plan to buy Marbury out of his whopping $21 million salary, cut him, or something in between. The Knicks were beginning to look bad, at this point.
* Then the Knicks decided to trade their top guard (Jamaal Crawford) and two other key players. After this move, D'Antoni approached Marbury, telling him that he now needs him to play 25-30 minutes in the next game because they only have eight players eligible on the bench.
* Marbury refused to play.
* The Knicks suspended Marbury for one game because of this. This equals approximately $400,000 in lost compensation for Marbury.

Now, what do you think Mr. Marbury did wrong?

Stephon Marbury is an employee of the New York Knicks (which is owned by Cablevision). He was asked to pull through for his team and go to work on a day when the organization had too few teammates to get the job done. If Mr. Marbury was able to move beyond the resentment and animosity he undoubtedly feels towards his employer, the man could have quite possibly started a brave new road to repair his contaminated image. And, if the embattled point guard actually helped his team to win, well... then this talented player might just have been seen by some as a hero, sacrificing his own ego for the greater good of the team. Imagine that. Maybe, he could even have had a future in New York City.  

But, of course, that was just a dream. Marbury let us all down... again. The irony here is that by making the obviously selfish choice not to play, Marbury really only hurt himself this time. You see, thousands of fans who continue to fight to keep their jobs in this disastrous economy cannot accept the fact that this spoiled, over paid employee simply won't do the professional thing and go to work when called upon (even under the worst of circumstances). They can't understand it, because many of them have to do this very thing each and every day. And, it's safe to say that 99 percent of those who are just "surviving" these times don't make even 5 percent of Marbury's salary.

The other irony is that Marbury will be looking for a new team shortly. It might be a day, a week or maybe he'll be forced to wait until the end of the season, but this once highly touted guard now has to convince some other sucker (uh... that is general manager) that he has the "goods" to lead a professional basketball team. That would mean that Stephon would need to accomplish what we all know now is impossible. He’d need to actually put his own team ahead of me, myself and I.

The Internet "loves" Cease-and-Desist letters

Here's another example of bad lawyerly advice. Clear Channel Communications tried to force a Web site in Connecticut to take down an audio recording, only to have the segment pop up on hundreds of other sites within just days.

The cease and desist strategy began after an interview by Tom Scott, a talk radio host at Clear Channel station, WELI-AM in New Haven, recorded a heated interview with Democratic Senator Christopher Dodd. It seems that Mr. Scott is a former Republican state senator. He accused Mr. Dodd of misconduct in getting a personal mortgage. Or course, Mr. Dodd fervently denied this allegation.

For reasons unknown, the interview was never broadcast and Mr. Scott quit the station soon thereafter (he claims censorship took place). And, as fate would have it, the recording turned up on a local Internet news site, The New Haven Independent, along with this article highlighting the immediate demand by Clear Channel to remove this WELI unapproved interview. You can see that the article makes Clear Channel look pretty silly... as if it had something to hide from the public.

Of course, anytime a whiff of legal intimidation, censorship, or corporate "cleanup" is enforced on the Internet, the masses become aroused and this often leads to a story going viral. And, that's just what happened here. Political Web sites, bloggers and other radio stations (including at least one Clear Channel station) downloaded the recording and played or posted it. According to the managing editor of the Independent, "It crashed our server... and is by far the heaviest traffic we've had."

So, what's the moral of this story for corporations? Be smart about how you try to control your own content/intellectual property on the Internet (especially when it surrounds a potentially controversial issue.) Yes, it's important to be the master of your own domain. But, once the information has been released, the reality is that you really aren't in control anymore. Legally, you have every right to crack down on violators. But, the severely negative public relations impact from your actions might cost you a hell of a lot more in the end.