THE CARBONITE MANEUVER BACKFIRES

You may have noticed that I earlier mentioned the handful of half-hearted advertisers who fled the Rush Limbaugh show following the preposterous Sandra Fluke adventure.  I observed that the sponsors didn't make Limbaugh famous — he did that himself, all by himself. 

The sponsors are privileged to advertise on the Limbaugh show... It makes the sponsors more famous to be associated with a legitimate self-made celebrity. 

And what happens when such privileged sponsors decide to rashly pull their advertising from the hottest radio talk show in America?  Do they honestly think their petulant little demonstration of political bias is going to HURT Rush Limbaugh?  Well, let's see... 

Investors FLEE Carbonite After CEO Pulls Ads from Limbaugh Show

On Saturday, Carbonite CEO David Friend released a statement on his company’s website declaring that Carbonite had decided to “withdraw” advertising from Rush Limbaugh’s radio show in the wake of his controversial remarks involving Georgetown Law student Sandra Fluke because it will “ultimately contribute to a more civilized public discourse”:

Even though Mr. Limbaugh has now issued an apology, we have nonetheless decided to withdraw our advertising from his show. We hope that our action, along with the other advertisers who have already withdrawn their ads, will ultimately contribute to a more civilized public discourse.

However, it hasn’t done much to contribute to his company’s stock price. Since the market opened on Monday through its close today, Carbonite stock (NASDAQ:CARB) has plummeted nearly 12 percent, outpacing the drop of the NASDAQ index in that same time period by nine-and-a-half points. It was also one of the biggest decliners on the NASDAQ on Tuesday.

Hmm.  So, when the Carbonite CEO showed his true color (yellow) and ran like the coward he is, he actually damaged his own product and his company's reputation with investors. 

What did he think was going to happen? 

See, Rush Limbaugh has a reputation for standing behind his word and his convictions.  Even when the shit hits the fan, Limbaugh will offer a simple apology and move on, but he won't back down from what he said or did.  Typically, Rush concedes, "I may have used a wrong word or two, but my message stands."  That's why Rush Limbaugh survives everything. 

And that's the difference between a self-made celebrity and a scalded dog CEO of a data storage company.  The CEO runs away from risk, he distances himself from risk in order to preserve his product and his company. 

However, intelligent Enterprise Risk Management (ERM) is more than just running away from risk.  Intelligent ERM dictates that you sometimes assume a great risk, that you accept it for the ultimate good of your company. 

This is also called having a backbone.  It's also called being a leader. 

It's also why intelligent companies don't allow the CEO to make knee-jerk decisions that may injure the company.  Often, the CEO is the dumbest guy on the premises, okay?  As is amply demonstrated by the Carbonite Maneuver (that's a little pun for you Star Trek geeks out there). 

The CEO of Carbonite, David Friend, has publicly demonstrated that he doesn't mind jeopardizing his own company over political issues. 

David Friend's rather rash decisions reflect negatively on his company and perhaps even give us a glimpse of his company's inner workings. 

I wouldn't necessarily WANT my valuable files secured by a CEO who has demonstrated that he is so politically sensitive that he'd steer his company off track and into trouble over a silly comment made on a radio show. That doesn't lend to consumer confidence, which should be the utmost concern for a company whose product is SECURITY.