Great repost about PR problems with GTE
Kind of long but worth reading. What i bolded and underlined as you will see would be what i was frustrated with.
By: Annointed1
01 Jun 2005, 07:42 PM EDT
"PRESS RELEASE PROBLEMS. Today Tim Huff released a new PR about the move to Palmdale and perhaps not unexpectedly there has been considerable number of comments from RB regulars that (a) criticize the sophistication of the PR, or (b) point out some ambiguity in the information presented, or at least some confusion as to details, or (c) criticize those individuals who point out the perceived failings of the PR.
In the meantime, the objective fact is that the share price closed down, somewhat modestly, on the day of the PR release. Since many investors had been waiting expectantly for a PR release announcing the move to Palmdale (on the assumption that such news would have a positive effect on the share price), the underwhelming shareholder reaction to the PR and the decrease in the share price is at the very least disappointing. I say “at the least” because some may be annoyed or angered rather than merely annoyed, seeing the handling of this PR and its tepid reception as a wasted opportunity.
In my opinion (having been a shareholder now for 5 years and a committed “long” all that time), I think that there is some justification for being concerned about the lack of care and sophistication evidenced in the drafting of the Press Releases. More than once, a Press Release needed to be followed up by a subsequent Press Release in order to clarify some ambiguity or correct some error. More than once there have been grammatical or factual errors in the Releases (e.g. such as referring to the company’s symbol as GTEL rather than GTE, or failing to identify the parent company as Globetel rather than Sanswire). More than once, the effect of the Release (which one can assume was meant by the Company to convey positive information) was to depress the share price rather than stimulate it. More than once, the substance of the Release was criticized as “fluff’ rather than substance, and again the impact of the Release on the share price was either nil or negative.
This history suggests, to me at least. that the management of the company is plagued by an ongoing, uncorrected public/investor relations communication problem. Now perhaps others don’t see this as a significant problem, but I do. As I see it, the problem is many-sided: First, the “public” perception of the company, including sophisticated investors, is adversely affected by Press Releases that give the appearance of inept or unconsidered draftsmanship. The company’s image is diminished, to some degree by unprofessional Releases, and that cannot be helpful especially when a small company is struggling to get recognized as a serious player with a bright future. Second, Press Releases that aren’t well crafted and drafted with an eye to both factual accuracy and market impact do a disservice both to the company and to loyal long-term shareholders. Most of us, who are longs, have held the stock through thick and thin, over long periods of time, with the expectation that the company will ultimately prosper and that our investments will increase. We eagerly await the release of the next PR with the hopeful expectation that it will significantly propel the stock price upward. It is my opinion that the company’s management does a substantial disservice to the loyal shareholders by not crafting each Press Release with the utmost care in order to maximize its potential to advance the share price. I am not talking about hyping or manipulation, in the sense of manufacturing inaccurate information; what I am talking about is taking the time and effort to maximize the effectiveness of the Release.
I know that many company officers might take the position that their primary mission is to manage the operations of the company and that it should not be their concern to affect the stock’s market price. However, I think that is somewhat naïve, at best. Stock price is, or should be, a concern. Doing whatever is ethically possible to help support and increase the stock price is a legitimate concern of company management; after all, their actions in attempting to increase the share price of the company would in effect be attempting to increase the equity of the shareholders (the actual owners of the company). I personally think that company management ought to be concerned with increasing equity for the owners of the company whenever and however possible, within legal constraints. After all, increasing shareholder equity is a valid metric for evaluating the effectiveness of management. Moreover, doing whatever is possible ethically to help advance the stock price also benefits the company in the long run because by making the company’s shares more valuable, management increases the utility of those shares for acquisitions, expansion, financing and attracting new investors (and thus additional capital) who are lured by the escalating share price.
I apologize for being so long winded here, but I am getting a little frustrated by what I perceive as a somewhat “relaxed” management attitude when it comes to communicating the exciting story of our company in a way that would have a tangible effect on increasing the stock price. Many on this board have complained that there has been a lack of information released to the public, in an effective way (i.e. a way that is designed to help generate market excitement and thus help support or propel the stock price) that details all the various activities of the company – the progress of the Super Hubs, the credit card processing activities, the expansion of the VOIP business, the Magic Money card deployment, the Magic Phone, the strategic partnership with regional phone companies not to mention all of the potential excitement generating information regarding the Stratellite.
This is not meant to be a “bash” in any way. I am still fully committed to the company and have a hell of a lot of money on the line tied up here. I also believe that barring some unforeseen catastrophe the stock price will ultimately be much higher in the next few months, and I plan to stick around to benefit from that increase, but I am nonetheless a little miffed at what I see as missed opportunities to help move this stock price forward.
Mr. Huff – you have a lot of very loyal and very committed investors – they are a significant and very valuable resource of which you and the company should be very thankful and appreciative. It is not an easy thing to develop and maintain shareholder loyalty, but once you have earned that loyalty, I think that there is also a reciprocal obligation to do everything you possibly can to reward that shareholder loyalty and commitment. Respectfully, as a shareholder speaking just for myself, it is my opinion that you could best reward my loyalty and long term commitment by doing what you can to help move this stock price forward.
You seem to be doing and excellent job in strategically advancing the company’s operations (for that I am sure we are all thankful), unfortunately it is my assessment that you are not doing a very stellar job in “effectively” communicating the message of this company to the investment community. As a shareholder, my somewhat myopic test for the “effectiveness” of the job that the company has recently been doing in communicating information is the impact of the company’s communications on the stock price – by that measure, I think the recent string of Press Releases have been sadly “ineffective”.
Effective corporate communication to the investment community is both an art and a science. It is best left to those who are talented and skilled in such communication. I think that it has been amply demonstrated that much has been lacking in this department. Consequently, I urge you to make an important executive decision that will have a major beneficial impact on the fortunes of this company and its shareholders – as soon as possible obtain the best possible professional assistance to help create effective public relations and public communications for the company. If one of the ultimate objective of management is to have the investment community perceive Glotetel as a serious company with “billion dollar” potential, it’s time to stop issuing company communications that are more indicative of a second rate company.
Hoping to see you all at $15 per share or better." -Annointed1
