WorldCom's greed caught up with it
by Andy Oram
Related link: http://news.com.com/2009-1033-945345.html
WorldCom's size double, quadrupled, continued to increase
geometrically over the decade as it kept buying and buying. Even when
it first began to talk of acquiring MCI, several observers suggested
that it was stretching itself too thin. WorldCom wanted to buy Sprint,
too; the whole telecom field is lucky the European Union put a stop to
it. But in the dot-com era, this was considered just the accepted
strategy of gaining market share by any means and at any cost.
So finally it came down. The tragic flaw was in the original
strategy. I imagine that the questionable accounting practices were
just symptoms; they're the kinds of desparate measures taken by
managers trying to stretch out an unavertable decline. Very few
managers, I believe, practice unethical accounting, trading, or
reporting as a matter of course, and most of these no longer have to
do so because they have cushy jobs in the Bush administration.
Why do you think WorldCom went bankrupt?