Customer Reviews

Disconnected: Deceit and Betrayal at WorldCom

5 star:		(6)
4 star:		(4)
3 star:		(3)
2 star:		(3)
1 star:		(1)

 

 

This book could have been much better if it progressed in a linear fashion. Much time is spent talking about small time players and the industry in general, but Worldcom and Bernie Ebbers seem to be on the backburner. The scandal is not brought up until the last 15 pages of the book, with only vague reference to "cooking the books" and writing off capital expenses.

It's an easy, quick read that is mildly entertaining. Unfortunately, it falls short in the facts and research department.

It's a pity that the only currently available book on the WorldCom meltdown is "Disconnected." While I'm sure Ms. Jeter is a respected writer on Mississippi business "Disconnected" is a perfect example of what can go wrong when a journalist/columnist tries to write a book; it reads more like a series of columns cobbled together rather than anything coherent and unified, which is a shame as the WorldCom fiasco deserves better than this. As a former legacy-MCI middle manager I was hoping "Disconnected" would be an incisive look into how it all went wrong and while it does that to varying degrees of success it's a major effort to get through the book, primarily due to the poor writing. Jeter has a pronounced tendency to repeat herself, which often left me wondering if these were old columns "cut and pasted" together to make a book. One particular problem is Jeter's habit of introducing a player and 40 pages later mentioning them in passing without putting them back into context. A great example of this is Diana Day-Cartee who was involved in WorldCom's forerunner LDDS and allegedly one of Bernie Ebbers many mistresses. She's mention in Chapter 3 "The Spending Spree" (pages 30, 36, & 37) then disappears until page 72 when she pops back up again casually mentioned in passing as, "Diana (Day) married some music executive." Huh? Would it kill Jeter just to append a quick "Bernie's alleged former lover" or "Early LDDS stalwart"? This is typical of Jeter's treatment of characters in the book, she fails to provide context as to who they are and how they're relevant leaving you to flip back and try to recall who the heck they were. Again, this is typical of the problems when a journalist tries to expound things to book-length, but it isn't always like that as witnessed by Neil Hayes's "When the Game Stands Tall." Jeter takes great pains to try and be impartial, which was probably due to the fact this was written and rushed to press before Ebbers trial and there was no way of knowing how the verdict would go.

Jeter's book also lacks depth as it is told primarily from the legacy-WorldCom side of things and often ignores the perspective of the other companies forced into WorldCom. Some things in the book are spot-on, dead-accurate, and at times it was like a sickening trip down an unpleasant memory lane. But Jeter also gets some things absolutely dead-wrong which tells me she was over-relying on WorldCom sources rather than speaking to ex-MCI employees, which is sad as most of them would have been all too happy to talk (myself included). "Disconnected" would have benefited from a much more diligent editor and the book as considerable dead-space thanks to its odd layout (blank pages). Most of the recommendations on the back dust jacket are puff pieces from fellow Mississippians who likely never read the book beforehand and include her editor at the Mississippi Business Journal and a travel writer (!?). While I did find "Disconnected" a compelling page turner that I read rather quickly I was particularly interested in the subject matter. If it were anyone else I don't know they'd slog through this mess. With Ebbers and Sullivan rightly convicted its time for an updated version that fixes these problems, but preferably I'd rather see someone else just start from scratch.

This book was really enjoyable to read. It was straight forward and informative but without taking sides or making excuses for the company which I expected, considering the author was a Mississippian, the home of WorldCom. The only negative I've seen about the book is that it isn't full of accounting analysis about the company and the fraud itself. I think that's the point. The fraud is as simple minded and immature. You have a very high profile, international company so crucial to the world's telecommunication system and yet Scott Sullivan pulls the most blatant of frauds by just posting as expenses line costs that weren't. There's really nothing complicated or sophisticated about the move. It's not like Enron that created layer upon layer of fraud and deceit. Indeed, we now see that Scott Sullivan is planning to use the "but everybody else does it" defense.

The key in the tale lies in the mindset of the management team operating in the insular world of the Mississippi business climate. Also the look at how Bernie Ebbers went from a man selling stock in the company literally door to door facing his neighbors, to being a "front man" on Wall Street and deceiving the business community there with the help of Jack Grubman was incredible. That's where the story is.

I agree the book is probably not for someone who is looking for an accounting mystery. That just wasn't the case at WorldCom.
But the look at the people and their manner of dealing with others and the growing arrogance, tells the tale.

The book is presenting facts in a not too organised way. The most interesting facts are already presented at the beginning so that the following 150 pages just give more details.

It might have been better to focus more on the problem/case itself instead of describing early history in every detail.

Weakest point of "Disconnected" is that the book ends in the middle of the ongoing story and the reader does not know what was the outcome of this scandal.

Why to buy this book: This book will bring you up to speed on WorldCom.

What this book does: (1) gives a fact-based history of Worldcom from start (1984) to just past the end (December, 2002), (2) identifies and discusses key figures in the rise and fall, (3) introduces the foibles of Ebbers, (3) critiques the clash of corporate culture following of MCI acquisition (4) describes accounting coverup in broad terms (5) suggests four reasons for the fall: denial of Sprint takeover by Justice Department, inability to integrate and manage MCI, costly excess capacity entering the business slowdown of 2000-2003, Ebbers inadequacies.

What this book does not: (1) provide acceptable levels of detail in the acquisitions, (2) give enough detail for the strengths and weaknesses of key figures, (3) provide sufficient detail about the accounting cover up, (4) thoroughly analyze each of the reasons the reasons for the fall.

The author is somewhat confused by accounting terms, and perhaps about what the accounting issues were.

After reading this book, you will be ready for (and need to read) the next books that come out on WorldComm. At least, I want to know more about it.

Having panned the book, I still would recommend it to my students.

I found this book to be very basic and lacking details of the actual events that brought this company down. One minute you are reading about the genral morale of the office then all of a sudden there is a reference to "cooking the books" or something to the effect that this company is going to fall like a deck of cards. No where do you get the details of the actions that actually took place.If I wanted fluff I could have just watched some TV news stories on the company.

Some background: In 1986 I was hired by a regional long-distance carrier, based in Boca Raton, Florida, to fill a temp position in their line costs department. The company's name was Microtel and it was one of the upstart telco's that arose when Judge Green handed down his decision to break up ATT. Two and a half years later, I'd gone from temp to analyst to supervisor to Manager of Line Cost Administration; Microtel, had acquired a half dozen smaller, weaker telcos, and had, itself, recently been swallowed by Atlanta-based ATC (Advanced Telecommunications Corporation).

The environment in the brand-new long-distance industry of that time is best summed up by two statements made to me after I'd been hired. The first was by an analyst who'd been there a few months. "This is an industry that runs on testosterone," she told me. The other came when I asked my department manager what authorizations I'd need to start a certain project. "Damn the paperwork," he said. "Get it done and we'll worry about paperwork later."

In her book, "Disconnected: Deceit and Betrayal at WorldCom," Lynne Jeter does a remarkable job of capturing the entrepreneurial, over-the-top spirit that was the hallmark of the telecom industry at its outset, and of WorldCom, in particular, from the time Bernie Ebbers took its helm when it was still called LDDS to its demise and the aftermath. Think of thousands of Mom and Pop enterprises, each on steroids, each trying to grab weak competitors, knowing survival depended on growth, forced to keep the profit margin high in order to continue making acquisitions in order to keep surviving. A deadly and exhausting treadmill.

Jeter's writing matches her subject: it's compelling, urging us from one paragraph to the next, one chapter to the next, one episode in the life of LDDS/WorldCom to the next.

But this is a book that doesn't merely tackle the rise and fall of a business and its subsequent economic effect; Jeter keeps the priority where it belongs: "Disconnected..." is mainly the story of the people who started WorldCom, the rivals who feared it, its employees, from top to bottom, and the people in the community where it was based who were proud such a giant was birthed in Mississippi. It is a very human story.

Well-researched throughout, with both financial documentation and personal quotes and anecdotes from knowledgeable people, Ms. Jeter is savvy enough to not point a finger at the culprits likely to have pulled down WorldCom, or to lead the reader to a predetermined conclusion. Rather, she lays out the evidence and lets us decide for ourselves. Throughout, this is reportage at its best, not tainted by opinion.

Bernie Ebbers guided WorldCom almost from its beginning, although he claimed, "I am not a technology dude." But Jeter includes a telling illustration that provides insight for why Ebbers was so successful. Before LDDS came along, Ebbers was an entrepreneur who owned some motels and a restaurant. One day he told a friend, "You've got to slice tomatoes this thick because that's where a lot of your profit is." From there to running a multi-billion dollar company, he was a man who knew where the profit was.

Little touches like that separate the finer writers from the rest, and make interesting stories from lifeless facts.

But, the other major player in the company's demise was WorldCom's Chief Financial Officer, Scott Sullivan, who authorized or ordered the accounting entries that have since been called into question for overstating profits.

Oddly, I met Sullivan in 1990, in his pre-WorldCom days. He'd been with my company, ATC, only a few weeks as our number two man in Finance, but was new to the telecom field. As Manager of Line Costs, I was working late one night, trying to trace why a large amount of line usage wasn't reconciling to dollars. I determined the answer was in a report compiled by another department and walked over to see. Scott came in a few minutes after me. He'd been trying to figure out the same problem from a preliminary report he'd received. I found the error and showed it to him. He disagreed; he didn't understand that the behavior of usage through multiple switches in multiple switching systems over multiple lines, inherited from companies acquired over a half dozen years, could result in double counted minutes. I explained it and answered his questions. Polite and attentive throughout, when I'd made my case, Scott thanked me, shook my hand and left.

A few weeks later I left ATC, having decided the ninety-hour weeks weren't worth the paycheck. Over the years, I lost touch with my coworkers and then with the industry itself. ATC became a paragraph on my resume.

So, imagine my surprise when I picked up "Disconnected..." and saw Scott Sullivan's name and read of the heights he had reached at WorldCom. And then, imagine my shock when I neared the end of the book and read about the charges the SEC had leveled at Sullivan.

It makes me wonder whether, while I was teaching him how to not double count usage, Scott, bright and nimble-minded as he is, was figuring out ways to use the information to prop up company share price, and of course, his own personal stake in the company. I hope not. He seemed like a nice guy.

But, as we all knew, back when Judge Green handed down his decision, the door opened for billions to be made...if someone could just figure out how.

Lynne Jeter shows us that a few did figure out how, and tells us what happened when keeping those billions became too, too tempting.

I was expecting this book to be a great story, but very disappointed. I cannot believe the publisher allowed the author to publish this book as it is. The book is insipid and dull, has no flow, no story, or no plot. Let me present an example. I have read many insightful Newsweek articles by a writer Allan Sloan. For example, Sloan describes a Sprint merger event in this way, "If talk is getting cheaper, why did MCI WorldCom pay $115 billion to buy Sprint? The once staid phone companies have launched a merger blitzkrieg in an effort to emerge at the center of the wired world. Can regulators handle the complex new order....." It has a clear logical axis, and has a force to attract readers into it.

But Jeter describes it like this, "The merger announcement of WorldCom and Sprint spurred building activity around Worldcom headquarters as real estate developers readied for economic prosperity. The real estate inventory swelled with new planned unit....." It always presents off-center, trivial detail which makes a reader bored. 70% of books are consumed to described a dry and dull fact, like "the merger of company A & B raised the stock to $X" etc. There is no insight here.

But unfortunately, unlike Enron scandal, there is no other book that centered on the Worldcom scandal. You would get much better comprehension by collecting articles in Newsweek or Business Week, if you have LexisNexis or EBISCOhost.

I bought this book because I was writting a school paper about M&A's and Corporate Governance, and I found it very helpful. It describes through different stages the psychology and personality of Bernie Ebbers and some of his partners and employees in WorldCom, shows the way they did business and helps to identify the kind of organizational culture they created -that finally dictated the failure of this company-.

From an investor point of view is shocking to learn how some of this monster companies with ever-rising stock prices, are full of "air" with no real business model in sight, and still Wall Street analysts taking them to the top picks.

At some points is difficult to follow the story, because you need to remember too many names or events in order to understand who's who and what's what.

If you want deep detail of the accounting fraud, this is not the book for you, but if you want to understand the human reasons that took this massive company apart, you'll find it very interesting.

This book was really enjoyable to read. It was straight forward and informative but without taking sides or making excuses for the company which is what I expected, considering the author is from Mississippi, the home of WorldCom. The only negative I've seen about the book is that it isn't full of accounting analysis
about the company and the fraudulent activy. I think that's the point. The fraud is as simple minded and immature as it gets. You have a very high profile company so crucial to the world's telecommunications system yet Scott Sullivan pulls the most transparent of frauds by posting as expenses line costs, which of course weren't. There's nothing really complicated or sophisticated about the move. It's not like Enron, a company that created layer upon layer of fraud and deception. Indeed we now see that Sullivan is planning to use the "but everybody else is doing it" defense.
The key in the tale lies in the mindset of the management team operating in the insular world of the Mississippi business climate. Also the look at how Bernie Ebbers went from a man selling stock in the company literally door to door facing his neighbors, to being a "front man" on Wall Street and fooling the business community there with the help of Jack Grubman was incredible. That's where the story is.
I agree the book is probably not for someone looking for an accounting mystery. That just wasn't the case at WorldCom. The people and their attitudes are the story. It takes an arrogance to believe one can get away with what was done and it's all there in the book.