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Playing at Serial Acquisitions: The Case of Vodafone

Han Smit and Thras Moraitis

in Playing at Acquisitions: Behavioral Option Games

In a period of only a few years in the early 2000s, Vodafone's then CEO Chris Gent grew the company from a small UK-based mobile operator into the world leader, with over 240 million customers. He ... More

In a period of only a few years in the early 2000s, Vodafone's then CEO Chris Gent grew the company from a small UK-based mobile operator into the world leader, with over 240 million customers. He did this via a sequence of 26 strategic transactions, including the acquisition of AirTouch and deals leading to the creation of the Verizon wireless business in the United States. Judging from Vodafone's acquisition story, Gent played his cards well, while both Vodafone's rivals and the financial markets acted irrationally in some instances. However, even Gent may have made some typical serial acquisition errors on the road to building the world's leading telecom company. This chapter uses the Vodafone story to illustrate how behavioral pitfalls in strategy, valuation, and bidding can be related to various components of the options and game valuation approach.Less

BITs Come Home to Roost but No Philip Morris Moment Yet!

Prabhash Ranjan

in India and Bilateral Investment Treaties: Refusal, Acceptance, Backlash

This chapter studies closely the ISDS claims brought against India. A careful analysis shows the following: First, cases like White Industries v. India and Devas Multimedia v. India expose the broad ... More

This chapter studies closely the ISDS claims brought against India. A careful analysis shows the following: First, cases like White Industries v. India and Devas Multimedia v. India expose the broad and vague language of Indian BITs. Second and equally important is the fact that these cases show that none of the claims have been brought against India because India exercised her sovereign public power in good faith in order to attain an important public policy goal such as protection of the environment or promotion of public health etc. All these claims have arisen against India mainly due to bad regulation. Third, these ISDS claims also show the failure of the organs of the Indian State to be sufficiently sensitive to India’s BIT obligations. Fourth, a closer study of these cases especially of the cases brought by Vodafone and Cairn energy shows India’s hostile attitude towards ISDS.Less

The Mannesmann Executive Compensation Trial in Germany

in Law and Capitalism: What Corporate Crises Reveal about Legal Systems and Economic Development around the World

Germany has the third largest economy in the world, yet the features of German capitalism stand in stark contrast to the American system. The role that law plays in the economy differs also, as ... More

Germany has the third largest economy in the world, yet the features of German capitalism stand in stark contrast to the American system. The role that law plays in the economy differs also, as vividly illustrated by the recent criminal trial of corporate executives for deciding to award a key manager a large bonus in connection with the successful completion of a merger. This chapter shows how a social system and a legal regime organized along very different lines was deemed scandalous. In February 2000, a merger agreement joining Mannesmann, a German firm, and Vodafone, a British telecommunications company, was signed. Mannesmann had traditionally focused on the coal and steel sectors but had diversified into telecommunications in the 1990s. However, after failing to mobilize the French company Vivendi as a white knight and facing increasing shareholder support for the Vodafone offer, Mannesmann's management conceded defeat.Less

Media Ownership and Concentration in Spain

Juan P. Artero and Alfonso Sánchez-Tabernero

in Who Owns the World's Media?: Media Concentration and Ownership around the World

This chapter looks at media ownership and concentration in Spain. Once it has provided an overview of the Spanish media landscape, the chapter considers print media (newspapers, book publishing, ... More

This chapter looks at media ownership and concentration in Spain. Once it has provided an overview of the Spanish media landscape, the chapter considers print media (newspapers, book publishing, magazine publishing), audiovisual media (radio, broadcast television, multichannel TV platforms, video channels, film), telecommunications media (wireline and wireless telecom), and Internet media (Internet Service Providers, search engines, online news market). Concentration has decreased in five sectors, mainly as a result of Spanish deregulation policies: (terrestrial) television broadcasting, ISPs, multichannel TV, and wireline and wireless telecom. Telefonica has also become a dominant presence in South America, and has expanded to other European countries. Other market participants are Orange and Vodafone. Concentration among print media has increased due to the loss of advertising revenue and because of declining sales. Major firms are Prisa and Planeta. In the audiovisual media, major firms are the public RTVE, Planeta, and Berlusconi’s Mediaset.Less

Media Ownership and Concentration in the United Kingdom

Petros Iosifidis

in Who Owns the World's Media?: Media Concentration and Ownership around the World

This chapter describes media ownership and concentration in the United Kingdom. After summarizing the British media landscape, the chapter focuses on print media (newspapers, book publishing, ... More

This chapter describes media ownership and concentration in the United Kingdom. After summarizing the British media landscape, the chapter focuses on print media (newspapers, book publishing, magazine publishing), audiovisual media (radio, broadcast television, multichannel TV platforms, film), telecommunications media (wireline and wireless telecom), and Internet media (Internet Service Providers, search engines, online news market). A major concentration issue is Rupert Murdoch’s hold over various media properties. The public service BBC has been traditionally a powerful player in broadcasting, and has moved into digital and online services. Commercial operators have called for the government to curb BBC’s expansion efforts in the online market. The existing law is ineffective in preventing concentration and opened the door for more concentration and cross-ownership in the traditional industries like newspapers and broadcasting. In telecom, the major firms are BT and Vodafone. Cable TV is dominated by Liberty Global, while satellite TV is controlled by the Murdoch group. In print media, the major firms are Bertelsmann, Pearson, Bauer, Trinity Mirror, Daily Mail and General Trust, and The Guardian.Less

Media Ownership and Concentration in Egypt

Nagla Rizk

in Who Owns the World's Media?: Media Concentration and Ownership around the World

This chapter examines media ownership and concentration in Egypt. Following an overview of the Egyptian media landscape, the remainder of the chapter focuses on print media (newspapers), audiovisual ... More

This chapter examines media ownership and concentration in Egypt. Following an overview of the Egyptian media landscape, the remainder of the chapter focuses on print media (newspapers), audiovisual media (radio, broadcast television, multichannel TV platforms, video channels), telecommunications media (wireline and wireless telecom), and Internet media (Internet Service Providers, search engines). The evolution of politics underlies the configuration of the media ecosystem in Egypt. Although the contemporary media landscape in Egypt has become more dynamic within the last decade, government involvement is a cornerstone to the development, or lack thereof, of each sector. The government owns the TV broadcaster ERTU, the wireline incumbent Telecom Egypt, and the three major newspapers. In mobile communications, entrants are Vodafone, Etisalat, and Mobinil.Less

The World’s Major Media Companies

Eli M. Noam

in Who Owns the World's Media?: Media Concentration and Ownership around the World

This chapter presents the world’s top media companies in 13 industries across 30 countries. The industries are measured by revenue, as well as by a measure called the power index. Following that, the ... More

This chapter presents the world’s top media companies in 13 industries across 30 countries. The industries are measured by revenue, as well as by a measure called the power index. Following that, the world’s largest media firms are determined on the basis of revenues, market shares, and power index. The result show that platform media are by far the largest, and among them the largest, by the power index, are the companies owned by the Government of China, as well NTT, AT&T, Telefonica, Verizon, Deutsche Telekom, Grupo Carso, Vodafone, and Orange. Among content media, the top companies are, by power index, the Government of China, Google, the Murdoch group, Comcast, Globo, BBC, and Disney.Less

Media Ownership and Concentration in Germany

Julia Bösch, Max-Josef Meier, Philipp Rösch-Schlanderer, and Achim Ekkehard Henning Wolf

in Who Owns the World's Media?: Media Concentration and Ownership around the World

This chapter looks at media ownership and concentration in Germany. Once it has given an overview of the German media landscape, the chapter focuses on print media (newspapers, book publishing, ... More

This chapter looks at media ownership and concentration in Germany. Once it has given an overview of the German media landscape, the chapter focuses on print media (newspapers, book publishing, magazine publishing), audiovisual media (radio, broadcast television, multichannel TV platforms, video portals, film), telecommunications media (wireline and wireless telecom), and Internet media (Internet Service Providers, search engines, online news market, Internet portals). The central players in German audiovisual media are the dozen public service broadcast institutions, organized in ARD and ZDF. Policy is set by the Länder audiovisual regulatory organizations dominated by the large political parties. Several large print publishers have established a major role in television, such as Bertelsmann (RTL) and Axel Springer (ProSiebenSat1). Agreements between all Länder has created the basics of a dual public-private system of broadcasting. The system includes regulation for media concentration, stating that no single company can control more than 30% of all TV audiences. In telecom, the major players are Deutsche Telekom, Vodafone, and Telefonica. Other major print publishers are Burda, Bauer, and Holtzbrinck.Less

Media Ownership and Concentration in Ireland

Roddy Flynn and Paschal Preston

in Who Owns the World's Media?: Media Concentration and Ownership around the World

This chapter focuses on media ownership and concentration in Ireland. Following a summary of the Irish media landscape, the rest of the chapter considers print media (newspapers, magazine ... More

This chapter focuses on media ownership and concentration in Ireland. Following a summary of the Irish media landscape, the rest of the chapter considers print media (newspapers, magazine publishing), audiovisual media (radio, broadcast television, video channels, multichannel TV platforms), telecommunications media (wireline and wireless telecom), and Internet media (Internet Service Providers, search engines). Overseas involvement in Irish media, information, and communications industries has intensified over the past two decades. These changes are associated with shifts in the ownership structure of Irish media and changing regulatory practices and structures. Irish media are strongly influenced from the outside, by ownerships from the UK and the US, and by UK media such as BBC and BSkyB being widely available in the Irish market. The major telecom providers are Eircom, Vodafone, Telefonica. The largest print publishers are INM, Thomas Crosbie, and the Murdoch group. In audiovisual media, the largest participants are the public RTE, the Murdoch group, and Liberty Media.Less

Conclusion: The Everything Device

Ravi Agrawal

in India Connected: How the Smartphone is Transforming the World's Largest Democracy

The world changed on January 9, 2007. It was the Macworld trade show in San Francisco, an annual showcase for Apple products, and founder Steve Jobs was about to introduce a new gadget. “Every once ... More

The world changed on January 9, 2007. It was the Macworld trade show in San Francisco, an annual showcase for Apple products, and founder Steve Jobs was about to introduce a new gadget. “Every once in a while, a revolutionary product comes along that changes everything,” announced Jobs. The Macworld audience had a Pavlovian expectation for something game-changing that day. In 1984 Apple introduced the Macintosh, which went on to transform computing and make the mouse a mainstream accessory. Then in 2001, the iPod arrived. “It didn’t just change the way we all listened to music. It changed the entire music industry,” Jobs reminded his audience. (This was no exaggeration. When Apple began offering individual songs for ninety-nine cents on its iTunes store, the era of record companies selling entire albums was shattered.) “Today, we’re introducing three revolutionary products. The first one is a wide-screen iPod with touch controls.” Jobs paused for dramatic effect. On cue, the audience broke into hearty applause. “The second,” continued Jobs, “is a revolutionary mobile phone.” This time, before he could pause, cheers rang out—with a louder, prolonged burst of clapping. Apple had never manufactured a phone before. “And the third,” he went on, as a big screen behind him mirrored his words, “is a breakthrough internet communications device.” A whoop, followed by a polite round of clapping; by now the audience was a bit confused at the deluge of new products. Jobs let his words hang in the air, teasing the crowd as it waited in anticipation. “So, three things,” he recapped, as the screen behind him showed three Apple icons representing an iPod, a phone, and the internet. “A wide-screen iPod with touch controls, a revolutionary mobile phone, and a breakthrough internet communications device.” Silence. “An iPod, a phone, and an internet communicator,” Jobs repeated, as the screen displayed each of those icons in the center, flipping to reveal the next one. The animations behind Jobs had been carefully choreographed to match his words. Less