This post is written as part of AOL Money & Finance's Best & Worst 2006. Cast your vote for the most overused buzzword.
Thanks to Regulation FD (for "fair disclosure"), average investors have won the right to listen to the often torturous dance between Wall Street analysts and publicly traded companies during earnings season. When things go right, there are shouts of "great quarter guys," but when someone asks a particularly long-winded or controversial question, they usually say that they will "take it (their answer) offline." Executives promise to get back to the analyst "offline" if they don't feel like answering their questions. Like most buzzwords, this phrase doesn't say what the speaker really means.
Unfortunately its popularity seems to be skyrocketing. I mean, look at this search on the SeekingAlpha site. My theory is that some PR or IR person told a CEO: "Look, you may think the analyst is a moron, but calling him a moron is counterproductive in the long-run." Analysts have found it more useful to say "I'll take it offline" rather than "I wonder what load of bull you will give me to this insightful question."
There is a more serious issue here. Though it was never the rule's intention, companies are so scared of getting in trouble with the SEC over FD that they are reluctant to allow their executives to say anything that could conceivably be newsworthy in public. Spontaneous statements from CEOs, CFOs, and other top executives seem to be less common now, and that's a pity. I am not saying executives should be controversial just to get quoted in the media, but the public would have more faith in corporate America if executives would say what they really mean from time to time. Sadly, some companies are even afraid to go offline and will only answer questions on their earnings call. That's silly. Thank goodness, there are exceptions to this trend, such as media mogul Barry Diller of InterActiveCorp (NASDAQ:IACI) and Sirius (NASDAQ:SIRI) honcho Mel Karmazin. Otherwise, I would never be able to stay awake during earnings calls.
Jonathan Berr is the editor of the blog http://www.desperateinvestors.com.
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Reader Comments (Page 1 of 1)
12-19-2006 @ 10:27AM
G. A. M. said...
"Take it (their answer) offline" has been around since the early 1990's, long before Internet communication became the norm. I first heard it from my second-line supervisor, office manager in a 20-attorney law firm, when a question was off topic and could be dealt with later.
12-19-2006 @ 10:54AM
Jonathan Berr said...
That's really interesting. I wonder if people heard that phrase in the 80s or the 70s. Thanks for writing.