The great MCI debate

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Kevin Werbach, linked to my previous article on MCI and the death of telecom as we know it, and has posted very interesting commentary. In his opinion, there are two holistic points of view on the whole MCI debate.

This is what Kevin has to say.

bq. There are really only two intellectually honest viewpoints about the future of the telecom industry.  Om’s perspective is on one side, where the most thoughtful advocate is Eli Noam of Columbia University.  The argument is that telecom is locked in a deflationary death spiral, which only the stabilizing influence of regulators and oligopolies can avert.

From the way I read my previous post on the MCI debate, it makes a whole different point and discusses the moral issue. I am not discussing the deflationary death spiral and the need for Bells. In fact, I could care less about the Bells.

The point I was trying to make is that MCI nee WorldCom committed a massive fraud, (however simple as some commentators have said, but still a fraud,) and has gotten away scot free for its bad behavior. $750 million in fines is not enough because nearly $50 billion in shareholder equity has been wiped out.

The little guys who entrusted their money to the equally corrupt mutual fund industry are the ones holding the bag. The creditors, large banks and vulture funds have managed to push through this bankruptcy and will be able to recoup their funds quickly enough. The little guy gets screwed one more time.

Nevertheless, trying not to get away from the issue, I like to point out that since AT&T, Sprint, and the Bells did not commit fraud and are paying off their debt as any almost reasonable business entity, why should they suffer from the largesse of justice system. The long term impact of course would be financial upheaval at these companies and can the telecom industry afford that? Your guess is as good as mine. If they slowly die the natural death, so be it. But why accelerate the death spiral by supporting a criminal and fraudulent enterprise.

That was the point I was trying to make.

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I have to agree with the person who posted on the 12th , the WHOLE industry is corrupt it is just that MCI is the company who has came out abt it, AT&T, SBC, Qwest & Verizon all have major issues as well just not public yet , I have nothing but heartfelt sorrow for all of the people who lost thousands and millions of dollars in the end of it all. Although investing itself is a big risk what was done is an unfair cheat to the equity holders.
However mci DOES have all new execs and we even have an ethics commitee in place as well as many other items in place to ensure to the government and the public that we not only will do everything to ensure that this will never happen again but to show that MCI is a ROLE-MODEL for corporate governence.I am a small individual within the company(mass markets OBTM at that time) and the fraud that happened 2 yrs ago was so high above that we just knew our CEO stepped down , kindof a large group of pee-ons so to say , but now … When i hear people say that they should liquidate the co. or close them down, etc.. , I cant help but think how bad that is . not only for my personal employment,but for the 54,999 other employees scatterd throughout the country that i will never meet, and for the telecom industry, the Internet, thousands of small businesses, enterprises ,and residential consumers alike- who may not enjoy directly , but thrive from the fruits of the company like saving ..Having a lower bill from SBC or whoever b/c MCI is a competitor in their area and so they lower their prices for consumer retention, Having Reliable Internet access from resellers who use our PoP’s ,or any other company who uses our expansive network for daily business(you would be suprised to see all of the large well known companies)
So to conclude I think Michael Cappellas is doing a great job leading MCI into the future of communication and the rest of the world can look forward to great products and services NOW and in the future

These are my own thoughts i am in no way representing any of the views by MCI(r) and/or any of its subsidararies respectivly

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