|
|
|
Log in to manage your products and services from The New York Times and the International Herald Tribune.
Don't have an account yet?
Create an account '
Subscribed through iTunes and need an NYTimes.com account?
Learn more '
Log in to manage your products and services from The New York Times and the International Herald Tribune.
Don't have an account yet?
Create an account '
Subscribed through iTunes and need an NYTimes.com account?
Learn more '
Log in to manage your products and services from The New York Times and the International Herald Tribune.
Don't have an account yet?
Create an account '
Subscribed through iTunes and need an NYTimes.com account?
Learn more '
Log in to manage your products and services from The New York Times and the International Herald Tribune.
Don't have an account yet?
Create an account '
Subscribed through iTunes and need an NYTimes.com account?
Learn more '
Log in to manage your products and services from The New York Times and the International Herald Tribune.
Don't have an account yet?
Create an account '
Subscribed through iTunes and need an NYTimes.com account?
Learn more '
Log in to manage your products and services from The New York Times and the International Herald Tribune.
Don't have an account yet?
Create an account '
Subscribed through iTunes and need an NYTimes.com account?
Learn more '
Log in to manage your products and services from The New York Times and the International Herald Tribune.
Don't have an account yet?
Create an account '
Subscribed through iTunes and need an NYTimes.com account?
Learn more '
Log in to manage your products and services from The New York Times and the International Herald Tribune.
Don't have an account yet?
Create an account '
Subscribed through iTunes and need an NYTimes.com account?
Learn more '
Log in to manage your products and services from The New York Times and the International Herald Tribune.
Don't have an account yet?
Create an account '
Subscribed through iTunes and need an NYTimes.com account?
Learn more '
Log in to manage your products and services from The New York Times and the International Herald Tribune.
Don't have an account yet?
Create an account '
Subscribed through iTunes and need an NYTimes.com account?
Learn more '
There are many reasons to worry about Italy's prospects, but Mediobanca is no longer one.
After nearly seven decades of playing the puppet master of Italian capitalism, the merchant bank that Enrico Cuccia built has announced an official retreat. It is the end of an era.
Though Mediobanca's power was already much diminished since Cuccia's death in 2000, the new three-year business plan, unveiled on Friday in Milan, is a clear sign that corporate Italy, if not the state, is reforming.
Mediobanca will divest its holdings in other companies and focus only on retail and investment banking. That means the sale of part of its 13 percent stake of Generali, the insurer; 14 percent of media group RCS; 12 percent of a consortium that controls Telecom Italia; and a 5 percent chunk of Pirelli.
Cuccia founded the bank in 1946 as a bulwark for industrialists against the rising tide of post-war communism in Italy. The time was right for a Mediobanca. Domestic capital was scarce, politicians were skeptical of large private companies, and national borders were closed to the free movement of capital.
It worked out well for Mediobanca, largely thanks to Cuccia's ability to weave a tight net of finance and influence. The bank long stood at the center of Italy SpA. It could engineer mergers and takeovers, often without much concern for minority shareholders. It appointed and fired managers and generally meddled in all manner of financial affairs.
It also worked out well for Italy - for a while. Mediobanca helped nurture and finance a reasonably strong industrial economy in a country that had never had large, strong privately owned companies.
However, techniques that were clever and helpful in the 1950s and 1960s gradually became destructive and corrupt. Mediobanca became a byword for deals and shareholder pacts which unfairly favored insiders. It constructed cascades of holding companies, which allowed it to exert control more than the economic interests it held could justify. By the time Cuccia died, such tactics had helped make Italy a pariah for global investors.
An official acknowledgement that Mediobanca will, to paraphrase Cuccia, count rather than weigh shares, is welcome. If the words are followed by action, Mediobanca will unlock 2 billion euros of capital (after some hefty write-downs, naturally) that it can invest in its own business. It could return to its merchant banking origins, providing money and expertise to the next generation of Italian entrepreneurs.
Mediobanca's simplification goes along with a similar back-to-basics at its most important holding, Generali. Mario Greco, the chief execut ive, is selling some 4 billion euros of assets. He will use the cash to support the insurer's capital base and international expansion plans. That, combined with Mediobanca's planned reduction of its stake in the group, should make for a more robust Generali.
The dismantling will create more market discipline. RCS, publisher of the influential Corriere della Sera newspaper, for instance, must convince shareholders considering subscribing to its 421 million euro rights issue that it will make a financial return, not confer them editorial favors. That is a major change.
The old guard assembled around the Mediobanca corporate galaxy was known as “the salotto buonoâ€, the fine drawing room. The salotto will now be shuttered. That leaves many companies unprotected from a takeover, even - gasp - by foreigners. But the discipline of a more open market will help companies compete better against European and global peers. And at a time when international investment in the country has virtually dried up, a foreign economic invasion is the least of Italy's worries.
The willingness to abandon practices that had long outlived their usefulness should set an example for Italy's politicians. In the drawing rooms of Rome, there is much talk about the need for reform. There has been some action, but not nearly enough. The political establishment is still prey to the forces of inertia - those rules, regulations and institutions that hold the country back.
It is time to rediscover the capitalistic and innovative forces that united Italy in the 1860s and that gradually turned a poor agricultural and semi-feudal economy into an industrial miracle. In that context, the salotto buono's dissolution is, indeed, molto buono.
Rob Cox is editor of Reuters Breakingviews. For more independent commentary and analysis, visit breakingviews.com.
After a promising debut, shares in Gogo Inc. have hit some turbulence.
The in-flight Internet service provider's shares fell $1 in their first day of trading, closing at $16 on Friday. The company priced its initial public offering Thursday night at $17 a share, the top of its expected range.
Through its stock sale, Gogo raised about $187 million and was valued at almost $1.5 billion.
Though a familiar name to business travelers everywhere - it is the leading provider of WiFi on flights by Delta Air Lines, American Airlines and others - the company drew some concern among investors and analysts. While Gogo's revenues have climbed steadily over the past three years, to $233.5 million last year, it has posted losses applicable to its common stock over the same time.
The company now trades on the Nasdaq stock market under the ticker symbol “GOGO.â€
Gogo's offering was led by Morgan Stanley, JPMorgan Chase and UBS.
Regulator in New York sets tough bank fine. | Regulators are divided regarding consultants. | Consultants may face tighter rein from Albany. | Headhunter for the rich turned on them, says Andrew Ross Sorkin.
A look back on our reporting of the past week's highs and lows in finance.
Sprint Beats Dish's Latest Bid for Clearwire | Sprint Nextel is hoping to end the fight for an embattled wireless network operator that nonetheless has become the object of a bidding war. DealBook '
Regulator in New York Sets Tough Bank Fine | The Bank of Tokyo-Mitsubishi UFJ reached a settlement with the top financial regulator for New York State over accusations that it had sent about $100 billion in tainted money through the United States. DealBook '
Britain Prepares to Sell Its Stake in Lloyds and Weighs a Breakup of R.B.S. | Comments by George Osborne, the chancellor of the Exchequer, were the clearest sign yet of the government's approach to the two b ailed-out banks. DealBook '
Weak Bond Trading at Jefferies Prompts Wider Concern | The challenge for Wall Street firms is how to continue to generate fixed-income profits in this environment. DealBook '
Ex-UBS Trader in London Is Charged With Fraud in Libor Case | Tom A.W. Hayes appeared in a court on eight charges of conspiracy to defraud in connection with the London interbank offered rate. DealBook '
DealBook Column: Headhunter for the Rich Turns on Them | A British recruiter who supplies domestic workers has filed lawsuits against the families of some of the most prominent names in finance, says Andrew Ross Sorkin. DealBook '
Private Equity Firm Tied to New York Pension Scandal Raises $7.7 Billion From Investors | Riverstone Holdings said that it raised its largest fund ever, four years after a settlement over its role in a “pay-to-play†pension fund inquiry. DealBook '
Sony Rejects Call to Divide Its Businesses | Kazuo Hirai rebuffed a renewed push by Daniel S. Loeb to break up Sony's sprawling empire but saying the company's board would study the matter. DealBook '
Criticism for Lack of Oversight on Bank Advisers | A warning that there was a risk to the economy in the lax oversight of firms that banks hire to help them comply with federal rules. DealBook '
Ex-Chairman of the F.T.C. Is Set to Join Davis Polk | Jon Leibowitz is the latest among high-ranking government lawyers in Washington to assume a rich position in the private sector. DealBook '
‘Black Skinhead' | Markets are in turmoil and Benjamin Lawsky is on a tear. What's a financier to do, but crank up Kanye West and point the Maybach toward the Hamptons. YouTube '
The prison sentence of Jeffrey K. Skilling, the former chief executive of Enron who spearheaded the pervasive fraud that destroyed the energy company, was reduced by 10 years on Friday after a federal judge approved a deal between his lawyers and prosecutors.
Judge Simeon T. Lake III of Federal District Court in Houston, who oversaw Mr. Skilling's trial in 2006, signed off on an agreement that will decrease his 24-year sentence to 14 years.
The reduction was driven in part by a 2009 appeals court ruling that ordered a recalculation of Mr. Skilling's sentence because of a mistake made by the judge in interpreting the federal s entencing guidelines.
Mr. Skilling, 59, who has been serving his sentence at a federal prison in Colorado, appeared in court on Friday wearing an olive-drab prison uniform and a salt-and-pepper beard, and looking bulkier than he did during his days as a corporate chieftain.
He will now exit prison as early as 2017. There is no parole in the federal criminal justice system, but Mr. Skilling will most likely receive the standard 15 percent sentence reduction for good behavior and a one-year reduction for completing an alcohol-abuse treatment program.
“We are relieved that Jeff can now look forward a day when he can come home to his family and friends,†said Daniel M. Petrocelli, Mr. Skilling's lead lawyer.
In exchange for his reduced sentence, Mr. Skilling gave up about $42 million, all of which will be distributed to victims of Enron's fraud. He also agreed not to pursue any further legal appeals, including a claim that would have accused the prose cution team of misconduct.
“The sentence handed down today ends years of litigation, imposes significant punishment upon the defendant and precludes him from ever challenging his conviction or sentence,†Mythili Raman, the acting assistant attorney general, said in a statement.
Several Enron victims wrote letters to the court protesting Mr. Skilling's proposed reduced sentence. On Friday, Andrew Stoltmann, a lawyer who represented several victims, criticized the Justice Department for agreeing to the reduction and said it was unacceptable coming on the heels of the lack of prosecutions arising out of the financial crisis.
“By entering into this early release agreement, a clear message will be sent to corporate C.E.O.'s that if you get caught with the hand in the cookie jar, you will get little more than a slap on the wrist,†Mr. Stoltmann said.
Mr. Skilling's legal team mounted a zealous appeal, seeking to overturn his conviction on a variety of legal grounds. Last year, they said that Mr. Skilling would seek a new trial based on recently discovered evidence.
The case also made its way to the Supreme Court, which in 2010 questioned the use of the “theft of honest services†law that helped convict Mr. Skilling, finding it unconstitutionally vague. But a federal appeals court ruled that there was overwhelming evidence of his guilt, so his conviction was not tainted by the use of that legal theory.
Mr. Skilling, a former consultant at McKinsey & Company, joined Enron in 1990 and led its transformation from a sleepy pipeline operator to a global energy-trading colossus. He also played a central role in the accounting schemes that masked its debts and weak finances from shareholders and regulators.
The fall of Enron, which at its peak was one of the country's most admired businesses, cost shareholders billions of dollars and its employees their retirement savings. Its demise ushered in a wave of prosecutions that rooted out accounting fraud at once-highflying companies like WorldCom, HealthSouth and Adelphia Communications.
Prosecutors tried Mr. Skilling alongside Kenneth L. Lay, Enron's chairman, who was also found guilty in the fraud. Mr. Lay died about a month after the trial, and his conviction was vacated.
During Mr. Skilling's time in prison, his parents and his 20-year-old son have died.
A version of this article appeared in print on 06/22/2013, on page B2 of the NewYork edition with the headline: Ex-Enron Chief's Sentence Is Cut by 10 Years, to 14 .
Everybody talks about how Amazon has killed the American bookstore, how Facebook is isolating our children, how tiny changes in Google's search algorithms can destroy small businesses. But Wikipedia has left some damage in its wake, too.
There was the Encyclopedia Britannica, of course, which ceased printed publication in 2010. But there was another, less visible casualty: the Computer Desktop Encyclopedia (C.D.E.).
It's an online dictionary of 25,000 computer and consumer electronics terms, written over 30 years by Alan Freedman, his wife, Irma Morrison, and occasional part-timers. Until about eight years ago, the C.D.E. served as the built-in computer dictionary for 20 technology-related Web sites. (They used their own names for it: TechEncyclopedia, ChannelWeb Encyclopedia, ZDNet Dictionary, and so on.) Today, PCMag.com is the only tech site that still builds in the C.D.E. (FreeDictionary and YourDictionary.com also incorporate it. )
Mr. Freedman, a corporate computer trainer for many years, has therefore taken the only logical path: He's now made the C.D.E. free online to all, at computerlanguage.com. And he challenged me to compare his definitions with its rivals.
One thing is for sure: There's something to be said for having a single editor. Wikipedia entries, of course, are written collaboratively by strangers with different agendas and writing styles. And its technology definitions tend to be by engineers, for engineers.
Here, for example, is Wikipedia's opening paragraph for its 23-page entry on “SATAâ€:
Serial ATA (SATA) is a computer bus interface that connects host bus adapters to mass storage devices such as hard disk drives and optical drives. Serial ATA replaces the older AT Attachment standard (ATA; later referred to as Parallel ATA or PATA), offering several advantages over the older interface: reduced cable size and cost (seven conductors instead of 40), native hot swapping, faster data transfer through higher signalling rates, and more efficient transfer through an (optional) I/O queuing protocol.
Host bus adapters? Really? And should the opening paragraph really dive immediately into a description of its predecessor?
Rival Webopedia is similarly technical. It doesn't even have an entry for “SA TA†- only for “Serial ATA†- and it starts like this:
Often abbreviated SATA or S-ATA, an evolution of the Parallel ATA physical storage interface. Serial ATA is a serial link - a single cable with a minimum of four wires creates a point-to-point connection between devices. Transfer rates for Serial ATA begin at 150MBps. One of the main design advantages of Serial ATA is that the thinner serial cables facilitate more efficient airflow inside a form factor and also allow for smaller chassis designs. In contrast, IDE cables used in parallel ATA systems are bulkier than Serial ATA cables and can on ly extend to 40cm long, while Serial ATA cables can extend up to one meter.
And here's ComputerLanguage.com's opener:
(Serial ATA). The standard hardware interface for connecting hard disks and CD/DVD drives to the computer. Introduced in 2002, almost all computers use SATA drives.
Let's try another one, for a buzzword that's always bugged me: “form factor.†Wikipedia doesn't have a page for it, only a “disambiguation†page. It begins:
A Form factor may refer to:
(If you're wondering what “disambiguation†means, by the way, here's Wikipedia's helpful breakdown: In computational linguistics, word-sense disambiguation (WSD) is an open problem of natural language processing, which governs the process of identifying which sense of a word (i.e. meaning) is used in a sentence, when the word has multiple meanings. The solution to this problem impacts other computer-related writing, such as discourse, improving relevance of search engines, anaphora resolution, coherence, inference et cetera. “Et cetera?†Really?)
Here's Webopedia's entire definition: “The physical size and shape of a device. It is often us ed to describe the size of circuit boards.†Circuit boards!? I've actually never heard “form factor†used to describe circuit boards; more often, it's cameras, phones, speakers and so on.
And now, here's ComputerLanguage.com on “form factor:â€
form factor. The physical size of a device as measured by outside dimensions. With regard to a disk drive, the form factor is the diameter of the platters, such as 2.5″, 3.5″ and 5.25″, not size in terms of storage capacity. See footprint.
Let's try one more. Suppose you wanted to know what 4K television is all about. Wikipedia doesn't have an entry for it at all â€" only a listing for “4K resolution†(again with the engineering slant):
S everal 4K resolutions exist in digital television and digital cinematography. The term 4K refers to the horizontal resolution (instead of the vertical) of these formats, which are all on the order of 4,000 pixels.
Webopedia, whose definitions tend to be ancient, has no listing at all for “4K TV†or “4K television.â€
ComputerLanguage.com does:
4K TV. A TV set with 2,160 lines of resolution. Although TVs emerged in the 2013 time frame, cable and satellite TV providers are unlikely to transmit 4K content before 2016. Also called “Ultra HD†(UHDTV) and “4K x 2K,†a 4K TV scales 1080p content to 2160p resolution, which provides visual improvements especially noticeable on 60″ screens and above.
Frankly, ComputerLanguage.com's homemade-looking Web design cries out for modernization. And the pricing for its various app incarnations is bewildering: It's available for Windows ($5 a year), iPhone ($3, branded by PCMag.com) and Android (free).
But it's clear that for anyone who's not an engineer, its definitions are far superior to the crowdsourced, sprawling, digital haystack of Wikipedia. And they're far more current than what you find on Webopedia.
Yes, it's true. ComputerLanguage.com is the very definition of concise, a user-friendly, up-to-date technical dictionary.