Rewriting History

The Chron pities the fools who bought Enron's hype

This just in: Enron wasn't quite as successful a company as many people believed.

This startling news comes to us courtesy of the Houston Chronicle, whose major front-page Sunday story January 27 was headlined "The Myth of Enron."

Enron looked successful, the story said, "but years before its spectacular fall…there were signs that Enron was never what it seemed…[A] close look at its history shows that the company relied on a steady stream of hype and distractions to gloss over its failures and avoid answering tough questions."

Those bastards. According to the Chron story, among those taken in by the Enron PR machine were Wall Street analysts, investors and "others." Those "others" apparently didn't include the Chronicle. The paper's longtime fawning coverage of Ken Lay's empire -- which was hardly unique, but still egregious -- was never mentioned.

So let us mention it. Specifically the paper's glowing megastory last April titled "The New Power," which gloried, in excruciating detail, in all the magnificence of Enron.

"The Myth of Enron," January 27: "The company never seemed to remain focused on specific strategies for long…Enron was always plugging The Next Big Thing, said a former longtime senior officer of the company. [Lay] threw out something new to keep investors, Wall Street analysts and others looking ahead, rather than back."

"The New Power," April 15: "Analysts said selling less-profitable assets is all part of Enron's strategy of frequently changing its businesses, which has been a cornerstone of its success. 'You're never going to win on every single investment, but Enron is usually smart enough to know when to get out,' said Rebecca Followill, an analyst in Houston for Howard, Weil."

"The Myth of Enron": "[T]he diversions could only last so long. Enron, the former official said, 'ran out of ideas about a year ago.' "

"The New Power" (well less than a year ago): "An open attitude towards new ideas is often cited as one of the key components to the success of Enron as the company continually reinvents itself."

"The Myth of Enron": "There were indications that Enron could be shaky years before its stock started its steady slide early last year."

"The New Power": An expert who's studied the company "said the question he is most often asked when he teaches his Enron case study is whether the company can keep finding new businesses to enter to sustain its strong growth. His answer is yes. 'I think their model can revitalize a wide variety of areas; I think Enron is going to be around for a long time,' [he] said."

And then there was this:

"The Myth of Enron": Analyst Jim Chanos "started shorting Enron stock -- or betting that it would fail -- in November 2000…Chanos' research found that…the company had a very low rate of return on capital." The story quoted Chanos as saying, "People who looked at the financials carefully were sort of underwhelmed."

Not the Chron, though. A month after Chanos's November 2000 move, Enron announced Jeff Skilling would be its new CEO, and the paper's headline back then was "No Ordinary Jeff: Lay's Successor Praised for His Skills and Vision."

"In a telephone interview," the story said, "Skilling echoed Lay's confidence in the company's well-being. 'The business is doing great, we have developed a business model that works and so it is going to be pretty much business as usual,' Skilling said."

Pretty much.

Dot-Com Death

Citysearch, the online city guide that more or less began -- at least in Houston -- in a blaze of glory four years ago, has died.

Ticketmaster, the company that now owns the outlet, announced January 28 that it was laying off 111 Citysearch employees nationwide. While the service will continue to operate in a half-dozen cities, the Houston version will be shutting down, according to those in the know.

(A Ticketmaster spokesman refused to comment on specific cities.)

Citysearch was an outgrowth of Microsoft's Sidewalk venture. The Seattle software giant made a big splash when it entered the Houston market in 1997, hiring notables such as former Houston Pressers John Wilburn and Brad Tyer, foodie Alison Cook, and Houston Post alumni Betsy Parish and Eric Gerber. Ticketmaster bought Sidewalk's nationwide operation for about $280 million two years later.

The company got rid of the writers and focused on local listings, to no avail.

Hallelujah Chorus

Add Channel 13's legendary Marvin Zindler to the list of vocal Ken Lay defenders. Twice in the past week he has offered commentaries on the departed executive. "My instinct tells me he has done nothing wrong," he said January 30. The next night he took time to heap praise on Lay's character by noting how twice (in the last ten years) Lay had let Zindler use Enron's corporate jet to transport sick kids to treatment.

Is it just us, or do Dave Ward and Shara Fryer look more and more alarmed whenever the camera cuts to them after one of Zindler's unhinged speeches?

 
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