Showing posts with label safra catz. Show all posts
Showing posts with label safra catz. Show all posts

Thursday, 25 November 2010

The missing crook

 

President Richard Nixon stepped down from office in 1973 after the arch-famous Watergate scandal. He basically had been responsible for having placed illegal systems to spy the Democrat Party.

Despite his attempts to defend his case with his famous “I’m not a crook” quote, he was over.

The Oracle-SAP trial that has ended so far with the jury’s verdict of a $1.3 billion to be paid by the latter to the former, and has been based on some sort of spying the arch-enemy too. We guess that, as in 1973 the internet was not so developed, no downloading of anything was really possible at that time.

The only conceptual difference we are finding between Watergate and SAP-gate is the missing crook. We have no one taking full accountability for the theft, and standing up to try to defend himself declaring he is not a crook.

The Pontifex Maximus at the oracle, aka Big Mouth Larry, certainly has tried to make Leo Apotheker, former SAP CEO, to take the Nixon role, but the latter swiftly avoided to serve as a witness before the jury.

Now, what might have the perception of Leo Apotheker in the market been? It could very well be a bad one, meaning that his no-show might have created an impression of cowardice or having something to hide. Should this be the case, it could very well impact HP seriously as well.

After the recent announcement by HP of its latest quarterly results, HP shares came up quite sharply, so good the results were compared to expectations. The day after, almost all the gains have been lost again, leaving HP’s share value halfway between Monday’s closure and Tuesday’s opening. Could it eventually have happened because having SAP been fined so much, the market thinks Leo Apotheker had something to do with that?

We do not have, of course, any proof of any involvement at all of Leo Apotheker in the TomorrowNow case. And we do not intendo to suggest he has the slightest guilt. However, we still think it could very well happen that people could think the way we described.

What suggests as well that HP should be cautious and careful about this, and keep an eye open to avoid being “collaterally damaged” by this verdict. HP is not completely unlinked to the case, at least from a market perception perspective.

Tuesday, 9 November 2010

Commie Pontifex

 

While World War I was at its peak, say 1917, the Soviet Revolution led by Vladimir Lenin was as well about to succeed. Lenin’s plans were based on support form people’s masses and organizations, one of the biggest and most important being, of course, the Army. As the Army was engaged at war, mainly against the German Empire of the time, Lenin desperately needed to withdraw Russia from the war at any cost, surrendering it needed. What actually happened thanks to Lenin’s propaganda skills. Russia surrendered to the German Armies, which were in fact occupying part of the Russian Empire territory, signed the Brest-Litovsk Agreement, and went home.

In order to get the Russian Army quit the war and join his ranks, Lenin mastered a convincing motto: "(World War I) is a war waged between German capital against Anglo-French capital but fought by workers”. He basically was calling Russian soldiers to disengage from a cause that was not theirs.

As the Russian commoner enlisted in the Imperial Army of Czar Nicholas Romanov was indeed from humble extraction and relatively fed up with the Romanov aristocracy, it was relatively easy for Lenin to succeed. The Russian High Command found itself with an unexpected enemy rising from inside that ultimately led to a dramatic defeat and an endless suffering of the people for decades. The Russian Army turned from fighting Germany to fighting local aristocracy. In other words, from fighting the technical and theoretical enemy (the Germans) to fighting a closer one which could be seen as more directly responsible of their suffering and poverty, ie their own aristocrats and landlords.

So the war against Germany was “technically” correct, but too high-level and far a concept. Russian soldiers where inflamed by Lenin to think shorter and focus on matters closer to them, to their daily lives.

If we think about an average juror serving at the Oracle-SAP trial, one thing we could consider is the actual way he might think. After all, an average juror is very much like an average citizen. They are on fixed income or salary, they have average rents… they are in fact far from the glamour and high standards of billionaires fighting about billionaire figures that are simply too big to fit in an average citizen’s mind. The numbers and figures talked during trials are way out of reach and beyond possibilities and imagination of average citizens. Therefore, even if legal argumentations could be technically correct, it’s fairly likely that a juror may think that this is a war waged by billionaires that just want to increase their obscene fortunes, but fought by regular employees.

Winning an jury trial is about winning the minds of jurors. It’s not about convincing experts, lawyers, technicians. And we think this is what probably Big Mouth Larry, Pontifex Maximus at the oracle, was aiming to when delivering the messaging he did in his testimonials on Monday. A technically correct argumentation, supported by Safra Catz’ moderate position, with the personal touch about the salaries of 100,000 families.

Now, for an average juror, all this sympathetic touch said by the guy owning the 6th biggest fortune in the world, the guy that spends thousands of dollars a day to sustain his standards of living, that affords teaming with other millionaires to yacht around the world, might sound a bit hypocritical. If the salary of 100,000 Oracle employees depended on the $4 billion Oracle is demanded on SAP and the Pontifex Maximus is so concerned with that, what the heck prevents him to spare $4 bn from his personal fortune to cover the problem? Wouldn’t he recover it sooner than later, so successful a businessman he is at Oracle?

We think that for the moment, Oracle’s strategy, technically correct from certain aspects, has missed completely the main target, which is winning for themselves the jurors minds and favor. It probably has not been the best choice to get the Pontifex to deliver the first heavy artillery blows, and they have missed who they need to convince. The battle’s not about technicalities that, by the way, fail to have documented support. It’s about convincing commoners about their cause being fair.

We understand it can be really difficult for a billionaire to think commie, but a commander at war should not forget considering the battlefield (ie jurors’ minds) specificities when planning battle. And, yes, Pontifex Maximus: This is something your dear Sun Tzu wrote.