Telecommunications Industry Overview

Telecommunications Industry Overview Telecom Sector Global Perspective Components and factors responsible behind the growth of telecommunications industry Two major factors responsible for the growth of telecommunications industry are use of modern technology and market competition. One of the products of modern technologies is optical fibers, which are being used as a medium of data transmission instead of using coaxial or twisted pair cables. Optical fibers can carry a high volume of data and are easier to maintain and install. Use of communication satellites makes this telecommunications industry a booming industry. The use of mobile network has a crucial role behind the growth of an improved telecommunications industry. Leading companies are showing their interest to invest in this telecommunications industry. Telecommunications industry is going to be a digitized one. Use of ISDN (Inter Services Digital Network) makes this telecommunication industry a total digitalized system and eventually enhanced the speed and quality of digital communication. Economical aspect of telecommunication industry World telecom industry is taking a crucial part of world economy. The total revenue earned from this industry is 3 percent of the gross world products and is aiming at attaining more revenues. One statistical report reveals that approximately 16.9% of the world population has access to the Internet. Present market scenario of world telecom industry Over the last couple of years, world telecommunication industry has been consolidating by allowing private organizations the opportunities to run their businesses with this industry. The Government monopolies are now being privatized and consequently competition is developing. Among all, the domestic and small business markets are the hardest. Market potentiality of world telecommunication industry The world telecommunications market is expected to rise at an 11 percent compound annual growth rate at the end of year 2010. The leading telecom companies like ATT, Vodafone, Verizon, SBC Communications, Bell South, Qwest Communications are trying to take the advantage of this growth. These companies are working on telecommunication fields like broadband technologies, EDGE(Enhanced Data rates for Global Evolution) technologies, LAN-WAN inter networking, optical networking, voice over Internet protocol, wireless data service etc. Top Global Telecom Players NAME ABOUT THE COMPANY SUBSCRIBERS in millions (09) REVENUE (in US billion$) China Mobile State owned Company, one of the 2 mobile phone monopolies in China Over 508 16.115 Vodafone Group Britains largest Telecom operator Over 427 68.32 Telefà ³nica, S.A. Multinational Company with stakes in Spain, Latin America Europa. Owns the O2 Brand Over 210 72.13 Amà ©rica Mà ³vil Mexican Operator. Controlled by the worlds richest man Carlos Slim Over 201 30.2 Telenor Group The company has a strong footprint in Central and Eastern Europe and Asia with over 40,000 employees. Over 172 15.73 Deutsche Telekom AG German telecom Company. Also owns t-mobile. Over 150 82.13 China Unicom China Unicom (BVI) Limited effectively holds 40.92% of the company and China Netcom Group (BVI) Limited holds 29.49%, while the remainder is traded on the Shanghai, Hong Kong and the New York stock exchanges. Both majority shareholders are state controlled enterprises. Over 186 14.62 TeliaSonera AB Offer services in 20 markets in the Nordic and Baltic countries, the emerging markets of Eurasia, including Russia and Turkey, and in Spain. Over 150 15.04 France Tà ©là ©com S.A. It is the main telecommunication company in France, the third largest in Europe. It currently employs about 180,000 people worldwide. Over 193 68.08 Bharti Airtel One of Asias leading integrated telecom services providers with operations in 19 countries across Asia and Africa. Zain is the new acquisition. Over 124 7.254 Mergers Acquisition Mergers and acquisitions (MA) and corporate restructuring are a big part of the corporate finance world. Every day, Wall Street investment bankers arrange MA transactions, which bring separate companies together to form larger ones. When theyre not creating big companies from smaller ones, corporate finance deals do the reverse and break up companies through spinoffs, carve-outs or tracking stocks. Not surprisingly, these actions often make the news. Deals can be worth hundreds of millions, or even billions, of dollars. They can dictate the fortunes of the companies involved for years to come. For a CEO, leading an MA can represent the highlight of a whole career. And it is no wonder we hear about so many of these transactions; they happen all the time. Next time you flip open the newspapers business section, odds are good that at least one headline will announce some kind of MA transaction. Sure, MA deals grab headlines, but what does this all mean to investors? To answer this quest ion, this tutorial discusses the forces that drive companies to buy or merge with others, or to split-off or sell parts of their own businesses. Once you know the different ways in which these deals are executed, youll have a better idea of whether you should cheer or weep when a company you own buys another company or is bought by one. You will also be aware of the tax consequences for companies and for investors. Defining MA One plus one makes three: this equation is the special alchemy of a merger or an acquisition. The key principle behind buying a company is to create shareholder value over and above that of the sum of the two companies. Two companies together are more valuable than two separate companies at least, thats the reasoning behind MA. This rationale is particularly alluring to companies when times are tough. Strong companies will act to buy other companies to create a more competitive, cost-efficient company. The companies will come together hoping to gain a greater market share or to achieve greater efficiency. Because of these potential benefits, target companies will often agree to be purchased when they know they cannot survive alone. Distinction between Mergers and Acquisitions Although they are often uttered in the same breath and used as though they were synonymous, the terms merger and acquisition mean slightly different things. When one company takes over another and clearly established itself as the new owner, the purchase is called an acquisition. From a legal point of view, the target company ceases to exist, the buyer swallows the business and the buyers stock continues to be traded. In the pure sense of the term, a merger happens when two firms, often of about the same size, agree to go forward as a single new company rather than remain separately owned and operated. This kind of action is more precisely referred to as a merger of equals. Both companies stocks are surrendered and new company stock is issued in its place. For example, both Daimler-Benz and Chrysler ceased to exist when the two firms merged, and a new company, DaimlerChrysler, was created. In practice, however, actual mergers of equals dont happen very often. Usually, one company wil l buy another and, as part of the deals terms, simply allow the acquired firm to proclaim that the action is a merger of equals, even if its technically an acquisition. Being bought out often carries negative connotations, therefore, by describing the deal as a merger, deal makers and top managers try to make the takeover more palatable. A purchase deal will also be called a merger when both CEOs agree that joining together is in the best interest of both of their companies. But when the deal is unfriendly that is, when the target company does not want to be purchased it is always regarded as an acquisition. Whether a purchase is considered a merger or an acquisition really depends on whether the purchase is friendly or hostile and how it is announced. In other words, the real difference lies in how the purchase is communicated to and received by the target companys board of directors, employees and shareholders. The Deal Start with an Offer When the CEO and top managers of a company decide that they want to do a merger or acquisition, they start with a tender offer. The process typically begins with the acquiring company carefully and discreetly buying up shares in the target company, or building a position. Once the acquiring company starts to purchase shares in the open market, it is restricted to buying 5% of the total outstanding shares before it must file with the SEC. In the filing, the company must formally declare how many shares it owns and whether it intends to buy the company or keep the shares purely as an investment. Working with financial advisors and investment bankers, the acquiring company will arrive at an overall price that its willing to pay for its target in cash, shares or both. The tender offer is then frequently advertised in the business press, stating the offer price and the deadline by which the shareholders in the target company must accept (or reject) it. The Targets Response Once the tender offer has been made, the target company can do one of several things: Accept the Terms of the Offer If the target firms top managers and shareholders are happy with the terms of the transaction, they will go ahead with the deal. Attempt to Negotiate The tender offer price may not be high enough for the target companys shareholders to accept, or the specific terms of the deal may not be attractive. In a merger, there may be much at stake for the management of the target their jobs, in particular. If theyre not satisfied with the terms laid out in the tender offer, the targets management may try to work out more agreeable terms that let them keep their jobs or, even better, send them off with a nice, big compensation package. Not surprisingly, highly sought-after target companies that are the object of several bidders will have greater latitude for negotiation. Furthermore, managers have more negotiating power if they can show that they are crucial to the mergers future success. Execute a Poison Pill or Some Other Hostile Takeover Defense- A poison pill scheme can be triggered by a target company when a hostile suitor acquires a predetermined percentage of company stock. To execute its defense, the target company grants all shareholders except the acquiring company options to buy additional stock at a dramatic discount. This dilutes the acquiring companys share and intercepts its control of the company. Find a White Knight As an alternative, the target companys management may seek out a friendlier potential acquiring company, or white knight. If a white knight is found, it will offer an equal or higher price for the shares than the hostile bidder. Mergers and acquisitions can face scrutiny from regulatory bodies. For example, if the two biggest long-distance companies in the U.S., ATT and Sprint, wanted to merge, the deal would require approval from the Federal Communications Commission (FCC). The FCC would probably regard a merger of the two giants as the creation of a monopoly or, at the very least, a threat to competition in the industry. Closing the Deal Finally, once the target company agrees to the tender offer and regulatory requirements are met, the merger deal will be executed by means of some transaction. In a merger in which one company buys another, the acquiring company will pay for the target companys shares with cash, stock or both. A cash-for-stock transaction is fairly straightforward: target company shareholders receive a cash payment for each share purchased. This transaction is treated as a taxable sale of the shares of the target company. If the transaction is made with stock instead of cash, then its not taxable. There is simply an exchange of share certificates. The desire to steer clear of the tax man explains why so many MA deals are carried out as stock-for-stock transactions. When a company is purchased with stock, new shares from the acquiring companys stock are issued directly to the target companys shareholders, or the new shares are sent to a broker who manages them for target company shareholders. The shar eholders of the target company are only taxed when they sell their new shares. When the deal is closed, investors usually receive a new stock in their portfolios the acquiring companys expanded stock. Sometimes investors will get new stock identifying a new corporate entity that is created by the MA deal. Why They Can Fail Its no secret that plenty of mergers dont work. Those who advocate mergers will argue that the merger will cut costs or boost revenues by more than enough to justify the price premium. It can sound so simple: just combine computer systems, merge a few departments, use sheer size to force down the price of supplies and the merged giant should be more profitable than its parts. In theory, 1+1 = 3 sounds great, but in practice, things can go awry. Historical trends show that roughly two thirds of big mergers will disappoint on their own terms, which means they will lose value on the stock market. The motivations that drive mergers can be flawed and efficiencies from economies of scale may prove elusive. In many cases, the problems associated with trying to make merged companies work are all too concrete. Flawed Intentions For starters, a booming stock market encourages mergers, which can spell trouble. Deals done with highly rated stock as currency are easy and cheap, but the strategic thinking behind them may be easy and cheap too. Also, mergers are often attempt to imitate: somebody else has done a big merger, which prompts other top executives to follow suit. A merger may often have more to do with glory-seeking than business strategy. The executive ego, which is boosted by buying the competition, is a major force in MA, especially when combined with the influences from the bankers, lawyers and other assorted advisers who can earn big fees from clients engaged in mergers. Most CEOs get to where they are because they want to be the biggest and the best, and many top executives get a big bonus for merger deals, no matter what happens to the share price later. On the other side of the coin, mergers can be driven by generalized fear. Globalization, the arrival of new technological developments or a fas t-changing economic landscape that makes the outlook uncertain are all factors that can create a strong incentive for defensive mergers. Sometimes the management team feels they have no choice and must acquire a rival before being acquired. The idea is that only big players will survive a more competitive world. The Obstacles to making it Work Coping with a merger can make top managers spread their time too thinly and neglect their core business, spelling doom. Too often, potential difficulties seem trivial to managers caught up in the thrill of the big deal. The chances for success are further hampered if the corporate cultures of the companies are very different. When a company is acquired, the decision is typically based on product or market synergies, but cultural differences are often ignored. Its a mistake to assume that personnel issues are easily overcome. For example, employees at a target company might be accustomed to easy access to top management, flexible work schedules or even a relaxed dress code. These aspects of a working environment may not seem significant, but if new management removes them, the result can be resentment and shrinking productivity. More insight into the failure of mergers is found in the highly acclaimed study from McKinsey, a global consultancy. The study concludes that companies often focus too intently on cutting costs following mergers, while revenues, and ultimately, profits, suffer. Merging companies can focus on integration and cost-cutting so much that they neglect day-to-day business, thereby prompting nervous customers to flee. This loss of revenue momentum is one reason so many mergers fail to create value for shareholders. But remember, not all mergers fail. Size and global reach can be advantageous, and strong managers can often squeeze greater efficiency out of badly run rivals. Nevertheless, the promises made by deal makers demand the careful scrutiny of investors. The success of mergers depends on how realistic the deal makers are and how well they can integrate two companies while maintaining day-to-day operations. Conclusion One size doesnt fit all. Many companies find that the best way to get ahead is to expand ownership boundaries through mergers and acquisitions. For others, separating the public ownership of a subsidiary or business segment offers more advantages. At least in theory, mergers create synergies and economies of scale, expanding operations and cutting costs. Investors can take comfort in the idea that a merger will deliver enhanced market power. By contrast, de-merged companies often enjoy improved operating performance thanks to redesigned management incentives. Additional capital can fund growth organically or through acquisition. Meanwhile, investors benefit from the improved information flow from de-merged companies. MA comes in all shapes and sizes, and investors need to consider the complex issues involved in MA. The most beneficial form of equity structure involves a complete analysis of the costs and benefits associated with the deals. Telecom Sector Overview INDIA Sub Base: 635.51 mn second largest market Wireless Penetration: 53.77% lowest in the world HHI Index: very high one of the most competitive market Prepaid Base: 96% one of the highest in the world Usage per sub per month: Minutes: 480 one of the highest ARPU: US$ 4.6 one of the lowest Rate per minute: US$ 0.01 one of the lowest in the world VAS:-11.6% One of the lowest Wireless Market Structure Subscriber Trends Customer Market Share (CMS) About Bharti Airtel BhartiAirtel, a leading mobile service provider in India is Bharti Enterprises flagship company. According to Forbes Global 2000 list, BhartiAirtel, Indias pioneering private telecommunication service provider is ranked no. 826. This integrated telecom service provider operates three strategic business units covering 23 telecommunication circles. These 3 strategic businesses are mobile business, enterprise business, and Airteltelemedia business. Their mobile business comprising fixed wireless and mobile services is spread over 23 telecom circles, whereas their Airteltelemedia business provides telephone and broadband services to clients in 94 cities. International and domestic long distance services and end to end telecommunication solution for companies are included in Airtel enterprise business. Brief history BhartiAirtel was established as Bharti Tele-Ventures Limited in 1985. This telecommunication company is a joint stock holding enterprise headquartered in New Delhi. BhartiAirtel, commonly called Airtel is among largest mobile service operator with a subscriber base of nearly 75 million. Airtel has a submarine cable landing station in Chennai connecting this South Indian city to Singapore. Products and services Services offered by BhartiAirtel can be classified into the following: Mobile services Based on number of customers BhartiAirtel is largest mobile service operator in India. This company offers mobile services based on GSM technology. For convenience of its customers BhartiAirtel has both pre- paid and post-paid facilities. Enterprise business BhartiAirtel provides integrated services comprising mobile, telephone, broadband, data and connectivity services internationally as well as nationally for small, medium and large scale enterprises. Its carrier service provides network connectivity through optic fiber over a distance of more than 35,000 km. BhartiAirtel is a member of South East Asia Middle East Western Europe 4 consortiums which include 15 global telecommunication service providers. AirtelTelemedia Services This Company offers high speed broadband services through landlines in 94 cities. Financials BhartiAirtel till March 2008 had assets worth US $6.61 billion. During period between April 2007 March 2008, it achieved sales amounting to US $6.61 billion and profits of US $0.94 billion. Awards and recognition BhartiAirtel was adjudged Best Carrier India at 2008 Telecom Asia. It was recognized as Best Cellular Service Provider and Best Broadband Service Provider at VD 100 awards for 2008. In 2007, BhartiAirtel won Business Leadership Award from NDTV Profit. BHARTI AIRTELS ROADMAP The management of BhartiAirtel Ltd is led by ManojKohli who planned to introduce affordability and high usage in its African portfolio which is currently a high price environment (with tariffs in some markets as high as Europe/US according to Bharti). Some of the key points about replicating Indian Wireless business model in Africa that are in favor of Airtel are, Bhartis 15-country portfolio has a population is 459m as of June 2010. Share of population living in urban areas in Africa is ~40% according to Bharti and expected to grow to 40%. This compares to 30% of Indias population living in urban areas. The youth population in Africa accounts for a fourth of the global youth and had a median age of 17-18 years. The working population is estimated to be higher than that in China and the middle class is 400m people, expected to growth to 500m. GDP growth in 27 economies in Africa is 5%+. BhartiAirtel stressed that governments had received Bharti well in Africa and that some officials stated that Bhartis plans are in-line with their own. Current Wireless penetration adjusting for Multiple SIMs is around 24%. Operators have 20MHz of 2G spectrum and 10MHz of 3G (those who do) which Bharti stated implies little room for more competitors. COMPANIES OF BHARTI ENTERPRISES BhartiAirtel: BhartiAirtel is Indias leading provider of telecommunications services. The company provides GSM mobile services across India in 23 telecom circles and broadband telephone services in 90 cities. Bharti Teletech Ltd.: Bharti TeleTech manufactures and exports world-class telecom equipment under the brand Beetel. It is the only Indian telephone company to be present in 30 countries mapping 5 continents. The companys product range include Basic Telephones, Caller ID Phones, Caller ID Boxes, Cordless Phones, 2.4 GHz Digital Cordless Phones, DECT 1.8 GHz Phones, and Set Top Boxes. Telecom Seychelles Ltd: Telecom Seychelles Ltd provides comprehensive telecom services including GSM Cellular, PSTN (Fixed Lines), Fax and Data, International Roaming, connectivity to Internet Services, Maritime Telecom Services (INMARSAT) and International Collect and Credit Card calling, in Seychelles, under the brand Airtel. BhartiTelesoft Ltd: BhartiTelesoft Ltd provides value added services and solutions to wireless and wireline carriers worldwide. BhartiTelesoft Ltd ha deployed products and solutions in 25 countries to over 100 network, and has a customer base of 150 million across 5 continents. TeleTech Services (India) Ltd: TeleTech Services (India) Ltd is a joint venture between TeleTech Holdings, Inc., worlds leading full-service provider of business process outsourcing and Bharti TeleTech Ltd. The company offers offer the entire spectrum of front-to-back-office business processes ranging from voice and non-voice customer support, back office administration (including credit and collections, account maintenance, application processing, claims processing, asset management, document management etc.), sales and marketing (including database marketing, marketing support, web sales and marketing etc.) to global customers. FieldFresh Foods Pvt Ltd: FieldFresh Foods (P) Ltd is an equal partnership venture between Bharti Enterprises and ELRo Holdings India Ltd, an investment company of the Rothschild family. The company provides premium quality fresh produce to the markets worldwide and promotes world class standards for agricultural practices, progressive farming techniques identification and adoption of appropriate technologies. Bharti Retail Pvt Ltd: Bharti Retail Pvt Ltd. is a 100% subsidiary of Bharti Enterprises. Bharti Retail is planning to launch its retail outlets in multiple consumer friendly formats in several cities across India African Telecom Sector It is one of the best penetrating opportunities for the global telecom players is the telecom market in Africa. In Asia, Europe, North America, the telecom sector is approaching a saturation point. The growth in these areas will be comparatively slower. The companies always look for the maximization of profit, whether it may be through cutting down of cost or increasing the sales. If the market reaches a saturation point then there is no opportunity to increase the sale. And if the company cannot decrease the cost then it will try either to diversify or to expand its grip in the global market. If the areas like North America, Asia and Europe are already in a saturation point then the next growing market for the global player will be Africa continent. Some of the major players in the telecom sectors of Africa are MTN, Zain, Vodacom, STC etc. Since the processes of liberalization and privatization have been taken into consideration by African countries such as Uganda, Tanzania, Nigeria, The Sudan, South Africa and Kenya, their telecommunication infrastructures have improved drastically. Many African governments have developed their telecommunication infrastructure by privatizing their former state-owned enterprises. So these open up the stage for global players to perform in it. Africa has become the fastest growing mobile-network market during last five years. The mobile user base has increased to more than 82 million in Africa. A survey by Ernst Young shows that between 2002-07, the industry grew by 49.3 percent as opposed to Asia which recorded a 27.4 percent growth. This reports estimate growth of the industry almost doubles that of Brazil which stood at 28 percent in the same period and is almost seven times the growth of France which grew at 7.5 percent over the same time. Even there was a report by The World Bank in which it mentioned that Afro-nations like Kenya have 95% of mobile network penetration and coverage gap of only 5%. Thus making it an attractive market to lure some of the major player from the world. Lets think a bit over this scenario. Why the Afro mobile market is developing so late and faster than any area that used to be at the same period of time. In 2004, only 6% of the African citizen owned mobile. The supply side was much higher than the demand side. And the prices dropped, but made the African mobile network market a huge potential market for the global players. They produced low cost and user-friendly phones and network plans to attract more and more customer so that the company can increase its customer base. But there some other criteria or which we also call as external environment of a company which affects a company to operate in that area. The Law of Land also affects the company to design its operation in a country. They may be the tax-policy, the FDI policy of the government, the policy regarding and regulating the telecom sectors etc. Because of these regulations, there are many Afro-nations like South Africa which hold a huge potential market. In South Africa, there are only three players in telecom network market. The heavy tax burden on both the operator and consumer is the major challenge for the industry, with an average taxation on the operators profits standing at 30%. For example, in Kenya, people pay tax of 26% on mobile communication and the operator pay the remaining 4%. The total tax paid is 30%. But still the government of these nations opines that the industry is highly profitable, despite of the fact that return on investment could be delayed due to poor infrastructure. The Afro-nation doesnt have the apt infrastructure or the geographical hindrances as well as the population is scattered. The main problem lies with the electric infrastructure. The company has to keep more than 2000 standby generators because of frequent power failure. On of the company operating in Kenya, Safaricom spends over KShs 171 million on diesels due to lack of power supply. This makes the cost of investment much high in comparison to the other area. The operating cost of the company is high in this area because of frequent power cut and even the tax rate is also high, thus bringing down the profit of the company. But it may be the future scenario of these countries which lures the global players. The company may sustain the loss in the short-run but it may earn profit in the long-run. Because the economy of Afro-nations are growing at a remarkable rate and the infrastructure are also gradually increasing. So it may in the long-run be aptly developed so as to favor the network industry. Moreover this is the entry level of the network sector in Africa as it is developing but once it get saturated the threat to entrants decreases because if they enter in to the segment, they will not find any extras to lure the customers. African Wireless Market Customer base: 36.36 Mn Perfomance Indicators: Revenue: 9,583 Mn EBITDA: 2,635 Mn Prepaid Base: 99.3% à ¯Ã†â€™Ã‚  one of the highest in the world Usage per sub per month: 103 Minutes à ¯Ã†â€™Ã‚  one of the lowest ARPU: ~US$ 7.4 à ¯Ã†â€™Ã‚  one of the competitive market Rate per minute: ~US ¢ 7.2 à ¯Ã†â€™Ã‚  one of the highest in the world VAS: ~7.9% à ¯Ã†â€™Ã‚  one of the lowest Emerging Market Characteristics in India Africa: Source: Airtel Investor Presentation Aug 2010 About Zain Zain is a Kuwait based company started under the name of Mobile Telecommunication Company (MTC) in 1983 and was later rebranded to ZAIN in 2007. Zain has present operation in 25 countries covering 17 countries in Africa and 8 countries in Middle-East, with a estimated workforce of 15000. As on February 2010, about 60% of the Zain customers are in Africa contributing only 15% to the net profit of Zain. Zain has a total of 65 million customers. Out of which 39 million customers are from Africa. The eight countries in Middle-East where Zain has it Operation are Bahrain, Iraq, Jordan, Kuwait, Saudi Arab, Lebanon, Palestine and Sudan, It has its operation in Lebanon under the brand name of MTC TOUCH. The seventeen countries which comprises of the members of the Zains Operative family in Africa are Burkina Faso, Chad, Democratic Republic of Congo, Republic of Congo, Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Sierra Leona, Tanzania, Uganda, Zambia and Morocco. Mr. Nabeel Bin S alamah is the CEO of the Zain Groups and Mr. Barak Al-Sabeeh is the chairman of the board of Director of the company. FINANCIAL FIGURES OF ZAIN Revenue : US$ 7.441 Billion Net Income :US$ 1.196 Billion Overview 4th largest mobile operator in the world in terms of geographic footprint, with a commercial presence in 23 countries 580 Million+ people under l

Hot Coffee Reaction Paper Essay

After watching the documentary â€Å"Hot Coffee,† I realized that it greatly explained how one incident started a domino effect that shook up the way Government protects big business forever. I strongly believe that Tort reform was meant to back big business and take away the rights of Americans who are wronged by these corporations. From a sociologist standpoint I can especially see the concerns of a conflict theorist because this is capitalism at its best. When Stella Liebeck sued McDonalds for a cup of hot coffee that she spilled on herself, a lot of people originally viewed the situation as a joke and as a plan for someone to get rich quick. Before watching the documentary I had no knowledge of the incident and thought it sounded like a case of lawsuit abuse. Soon after watching, I saw the negligence of McDonalds by not monitoring the temperature of the coffee and the major damage done to Stella’s skin. The medical bills were major and she deserved not only compensation for medical bills but punitive damages as well. She was awarded 160,000 dollars in damages and 2.7 million in punitive damages (eventually reduced to 480,000). After such an infamous case, it opened the floodgates for other Americans to go after businesses that had wronged them. In a case for Stella, the lawsuit was justified, but there were cases across the country were lawsuits were filed and many were trying to â€Å"get rich quick.† Sure it is a controversial situation but Tort Reform was used a defense mechanism for big business. Companies like tobacco corporations for example, were actually behind lawsuit abuse groups trying to help spark tort reform to favor them. They had all the money to back political campaigns for  nominees that would favor tort reform. This I believe is a matter of capitalism because the rich are investing in themselves and are literally fixing campaigns by funding whomever they believe look after their best interest. As another example, The Chamber of Commerce are a committee assembled of big business corporations who fund political campaigns for nominees who back their political views and invest in their well being instead of the nation as a whole. In other words, the rich want their nominees to win in order to protect their investments, therefore they all band together to achieve this goal. George W. Bush was definitely a beneficiary of highly funded campaigns and it showed. During his presidential campaign he was lobbying for Tort Reform and that meant capping punitive damages. There are cases where this cap hurts the people who are wronged from businesses that have wronged them. In the documentary the case of Colin Gourley strongly was affected by tort reform. Lisa Gourley gave birth to twins and during her pregnancy was constantly misdiagnosed and improperly observed. Because of the neglect of her doctor, one of the twins, Colin, was born with brain damage and would require therapy and special healthcare for the remainder of his life. She was constantly uneasy with the progress of her pregnancy but was always reassured by her doctor. Because of negligence, Lisa Gourley was awarded 5.6 million dollars in a lawsuit. However, due to the law in Nebraska, it was reduced to 1.6 million. This is a prime example of a system that failed a family due to tort reform. Ultimately this documentary opened my eyes to the many capitalist ways we operate as a country. This most definitely identifies with conflict theory. It is understood that this country is ran and protected by the wealthy. There are ways for things to change but this documentary demonstrates where our challenges lie.

Breaking News Journalism Is Still Alive - 769 Words

Breaking News: Journalism is Still Alive Words can be powerful and heavy and most of all complicated. On the other hand, dictionaries cut everything short. The Merriam-Webster definition of journalism, for example, is especially simple and direct—the job of collecting, writing, and editing news stories for newspapers, magazines, television, or radio. This definition fails to recognize though that just because something is written and published in a newspaper or on a news site does not mean that article falls into the realm of journalism. True journalism must follow certain rules like maintaining an independence from those they cover, having an obligation to the truth, and presenting the facts in a fair and balanced way. Most popular news†¦show more content†¦As Bill Kovach and Tom Rosentsiel write, â€Å"The purpose of journalism is not just to report but to create community. This involves creating channels, forums, and alliances, and helping connect people who are working on problems.† (Kovach, Bill, and Tom Rosenstiel. â€Å"Independence†.) Independence, open-mindedness, truth, and loyalty to readers and community are all the heart of true journalism. Unfortunately, with the term journalism skewed, sometimes good examples are hard to find. Although with some digging, there are news sources that adhere to journalistic ethics. Propublica, for example, is a nonprofit and independent news source that focuses on reporting facts. Their code of ethics is readily available on their website and clearly states the morals behind their company. By directly telling their audience what to expect and how their employees should behave, a clear cut process of news is shown and when a discrepancy is made they are held liable. The Center for Investigative Reporting is also a nonprofit and nonpartisan news source that is truth driven to hold the powerful accountable. The company has won multiple awards in journalism such as the MacArthur Award and has been a finalist for a Pulitzer several instances. They state that their goal is making their news stories â€Å"accessible, inclusive, and participatory.† Their website’s about page also e xplains, â€Å"We invite the public to hold us accountable for producing the best and deepest reporting on issues that affect

The Importance of Critical Thinking in the Prevention of Natural and Handmade Disasters Free Essay Example, 2000 words

Although intelligence agencies did their best, they were unable to prevent the attacks because the most information was withheld, ignored or distorted. Another reason why the terrorist attacks occurred was lack of application of critical thinking skills. Federal officials ignored the importance of these skills in unblocking communication arteries. In addition, they were unable to invent new ways through which communication could be promoted (Kiltz, 2009). Although the United States had been warned concerning the terrorist attacks, most leaders failed to perform their duties to ensure that these attacks were avoided. An example of this is the Homeland Security secretary, known as Michael Chertoff. He was among many other leaders that failed in their duties by ignoring the threats of terrorist attacks. Being the president s chief advisor on matters concerning disasters, he was unable to execute appropriate organizational decisions. Due to his dormancy during the attacks, soldiers were unable to access the necessary supplies and equipment that would be useful in preventing attacks. It was therefore difficult for them to respond to the terrorist attacks. All these are indications that Michael Chertoff lacked critical thinking skills. We will write a custom essay sample on The Importance of Critical Thinking in the Prevention of Natural and Handmade Disasters or any topic specifically for you Only $17.96 $11.86/page Most universities have developed degree programs concerning homeland management. The main reason for this is to ensure that all students are well equipped with critical and thinking skills that would enable them to deal with disastrous situations.