Chapter Eight

NEW YORK CITY/PALO ALTO, CALIFORNIA
SEPTEMBER 19, 2000

FROM THE WALL: STREET JOURNAL:

Industry Focus: Roger

Gordian's Growing, Failing Monstrosity

BY REYNOLD ARMITAGE

There is drama in the numbers: by its own accounting estimates UpLink's earnings have fallen 18 % in the past year, the largest slide in its third consecutive quarter of decline. Its stock prices continue to drop at an even more precipitous rate, having closed the week by falling $15.4656 to $45.7854 a share on Big Board composite volume of 100 million shares, a decline of 25 %. As a result of these losses the corporation's market value has plunged by about $9 billion, considerably below even the gloomiest of analysts' predictions and raising new questions about whether the high-tech giant can support its heavy investment in a global "personal communications satellite" network — one requiring the launch of about 50 LEOs and 40 gate way stations around the world, for a total investment of over $3 billion over the next five years.

There is drama in the numbers, but the entire story is more complicated than they reveal upon first examination. Certainly the defense and communications operations at the heart of Roger Gordian's past success desperately need to have the causes of their ill health diagnosed and remedied. But to completely understand the forces bringing down his parent company, one must look at the poor track records of its spawn. To offer but a few examples: the lackluster performance of UpLink's specialty automotive subsidiary, the chronic profit drain of its medical devices and power generation divisions, and the recent Dow losses suffered by its computer hardware and software offshoots due almost entirely to Gordian's imperious and unreasonable decree against the sale of cryptographic technology to emerging overseas markets. Indeed, the catalog of failures and borderline failures for what had been one of America's leading companies seems endless.

Unease runs deep among investors, who fear that Roger Gordian has created a patchwork monster, a multi-limbed aberration whose lifeblood is being diverted away from its corporate center to sustain its unwieldy reach. To be blunt, as UpLink's once highly valued stock continues to lose ground, it becomes less critical to ask whether its problems are due to hubris, inattention, or simple bad judgment on the part of its executives, and fitting to state the obvious bottom line — its board has failed to uphold its basic fiduciary responsibility to shareholders, namely guaranteeing a premium return on their investments.

Let us pause here to consider an image of cojoined or 4 'Siamese" twins— better yet, make them triplets — their bodies connected by an implacable tube of flesh, nerves, and intertwined blood vessels. In the cradle, they coo and embrace. As young adolescents they plan for a future that seems a bright, infinite frontier.

But adulthood brings change and discord. One of them grows to enjoy composing gentle romantic poetry. Another's great pleasures are drinking and arm-wrestling in rowdy taverns. The third simply likes to fish in the sun. Miscreated, mismatched, and miserable, they try to reach some lifestyle accommodation, equally dividing their time between preferred pursuits, but their basic incompatibility of nature causes all three to fail.

The poet cannot write because the long nights in hard bars make soft, lyrical thoughts impossible, and because he suffers hangovers from the alcohol flowing through their common bloodstream. The prodigal grows depressed and contrary while his versifying brother struggles to focus on the intricacies of rhyme and meter. Their constant arguing exhausts the fisherman, so that he merely sleeps away his mornings by the stream, and his rod frequently drops from his fingers to be dragged off into the water by a darting bass or trout, gone with a splash.

Eventually the three brothers wane and perish. The cause stated on their death certificates? One does not know the medical term, but perhaps it might rightly be called overdiversification.

What can be done to spare UpLink from a similar demise? For answers we might contrast the untenable generalism of its expansion to the cautious, focused growth of Monolith Technologies….

Although it wasn't yet time for the reception to conclude, Marcus Caine was feeling bored and stuffy-headed in the packed United Nations chamber. From his place at the dais, he sat staring past exotic floral arrangements at a profusion of television cameras, cables, floodlights, and microphone booms, all manipulated by a crew of scurrying technicians. Behind him was a large collapsible backdrop showing the U. N. symbol, a globe viewed from the North Pole and surrounded by olive branches. Because this was a UNICEF event, there was the added touch of a woman holding a young child in the center of the globe. Caine's wife, Odielle, sat quietly at his right, her face thin and clamped. On either side of them were officers of the organization's Executive Board and high-ranking members of its parent body, the Economic and Social Council. Below him, rows of interpreters in headsets were translating their insipid, windy speeches into six languages.

As the current speaker droned away about Caine's philanthropic largesse, he absently glanced down the length of the table at Arcadia Foxcroft, Lady Arcadia, his connection to the Secretariat, and the woman who had arranged the ongoing event. Wanting to stop his mind from drifting off entirely, he stared at her, made her his fixed point of concentration. It wasn't hard. She had the sort of face one would expect to see on a fashion model's head-shot — exciting, glamorous, provocative. Her peach-colored dress accented a spectacular figure. Lively blue eyes flashing, delicate lips parting over perfect white teeth, she was having a conversation with the fellow next to her, laughing at something he'd said. Though he couldn't hear the laughter from his seat, Caine was very familiar with the sound of it.

Somehow it always made him think of sharpened glass.

Caine watched her. A man-killer, Arcadia. And aware of it, as were all women of her type. She brushed back a wisp of auburn hair, revealing one of the diamond earrings that he'd bought for a small fortune at Harry Winston's and given her while they were in bed the previous night. He had dropped them between her thighs after they made love, and she had found that tremendously arousing. As she'd put them on, and then slid on top of him, groaning breathlessly, awakening him to delight again, he'd wondered how many other sexual dalliances she was having even while they conducted their affair, how many other partners were lavishing her with expensive gifts. Doubtless quite a few. Which was all right. Bad girl, Arcadia. He had his fair share of her, and thought it was only sporting to let the rest of the boys have theirs.

Besides, he liked to imagine her engaging in hidden, illicit acts out of his presence… just as he thrived on the tension of having his wife and mistress seated in the same room, rubbing elbows, making small talk, secrets running between them like unseen trip wires.

Caine was dimly aware that another speaker had taken the microphone. A famous Hollywood actress who had married a New York congressional leader, semi-retired from the big screen, moved out to East Hampton, damped her incandescent beauty behind scholarly wire glasses, and become a dedicated spokeswoman for children's causes. Caine wished he'd dated her when the chance had presented itself some years back. Now she was expressing her admiration of his professional standards, his accomplishments in wedding the mass media to computer technology, his inroads into new Asian cable television markets. She raised a chuckle from the crowd with a line that used the word "gizmo," shifted her tone to one of sober concern, and last but not least, praised his unflinching commitment to the Children, capital C. Thanks to Marcus Caine, she concluded wryly, it was truly becoming a small world after all.

Throughout the speech Caine kept his eyes on Arcadia, watching her flirtatious interaction with the dignitary beside her. He understood her quite well; indeed he and she were alike in a great many ways. Born in Argentina, the illegitimate daughter of a wealthy German expatriate and his one-time maid, she had been raised by her mother without paternal involvement or financial assistance, and was turning tricks in the streets of Buenos Aires before she was twelve. A decade and several wealthy clients later, having taught herself the manners and forms of sophistication, she slept her way into England's green and pleasant bowers, married a sputtering old lord who was ripe for the grave, secured his inheritance, and thus guaranteed her place in elegant High Society — make that capital H, capital S, please. She was a poseur, plain and simple. An urchin who had snuck into the ball and charmed her way into favor with the invited guests. No wonder her every gesture seemed an exaggeration. As if she constantly needed to prove herself to herself.

Yes, Caine understood her. As he sat among U. N. appointees chosen for their social status and connections, graduates of elite schools, men and women whose bloodlines and fortunes could be traced back centuries, pampered exquisites who were little more than walking family crests, how could he not? They were to the manor born. His father had been a sales executive who retired with a moderate pension after an undistinguished and psychologically anesthetizing career. His mother had taught third grade until she became pregnant with him and settled into being a housewife. Caine himself had been a good student throughout his youth, and attended Harvard for two years on a merit scholarship — but it had been withdrawn in his fourth semester when he'd gotten into some difficulties, and he'd never obtained his degree. Had he not fostered several important friendships before his expulsion he'd have been finished even before entering the race.

The fine ladies and gents in his company would have been astonished, completely astonished, if they knew what he thought of them, how contemptuous he was of them….

A flurry of movement to Caine's immediate right, near the podium, suddenly intruded on his thoughts. He straightened in his chair, breaking his attention away from Lady Arcadia. The speaker presently delivering an encomium to his humanitarianism was Amnon Jafari, Executive Secretary ECOSOC, and he seemed about to wrap things up. A group of dark-suited men had appeared from behind the collapsible wall with a six-foot-long blow-up of Caine's endowment check to UNICEF — three million dollars, which he'd promised to double once it was matched by donations from other wealthy individuals. The mock check was backed with plywood, and there were two members of the group holding it at each end.

The Secretary's voice was a deep tenor, and its volume grew as he ended his speech, expressing his gratitude to Caine with a final burst of enthusiasm. Caine heard his name boom from Jafari's lips to the acoustical drop ceiling, and then carry across the chamber to the VIP floor and public galleries. Applause crashed through the room like thunder.

It was time for him to accept the accolades. He would enjoy standing before the cameras while trying to outdo the pompous verbosity of his hosts.

He rose, went to the podium, and clasped Jafari's right hand in both his own. Then the Secretary stepped aside and Caine turned to face the crowd, the oversized reproduction of his check making a splendid prop behind him. He began his comments by thanking the roster of U. N. officials responsible for the event, speaking without reference to notes or the Teleprompter — Caine's eidetic memory was one of his strongest assets.

"Yes, I am honored to be here," he said when he was through rattling off names. Flashbulbs popped, cameras dollied in for close-ups. "But more than anything, I am grateful for the opportunity to stand before you today with a challenge. As many of you know, I have long been committed to extending the global reach of interactive electronic media, and especially Internet technology — for it is my belief that they are the modern magic that can unite the inhabitants and governments of Planet Earth and truly make us one, the tools that will bring about our next evolution as a species. Cyberspace allows us all, young and old, rich and poor, the great and the humble, to meet on a level field. A field with ever-expanding horizons and limitless potential."

He paused for some scattered handclaps, glanced over his wife's head at Lady Arcadia. She met his gaze and smiled at him, her lower lip tucked alluringly between her front teeth.

"Yet as we take our first steps into the infant twenty-first century, we must proceed boldly rather than tentatively to assure that none are denied access to this dynamic realm of information and knowledge. Those of us who have been blessed with lives of material comfort are obliged to share the rewards we have enjoyed. Listen up and listen well: It is time to dedicate ourselves to guiding and educating the children, so that they too may grow without limitation, and attain new and fulfilling horizons. Time for each of us extend a hand, and pledge a portion of our wealth to bringing them technology that will immeasurably improve their lives. It is a hard fact that advancement requires money. Schoolroom computers, high-speed DSL modems, Internet connections — none of these come free. From Bahrain to Barbados, from Afghanistan to Antigua, from the industrial capitals of Europe to the emerging nations of West Africa, the youngest and least fortunate of us must be guaranteed access…."

Caine went on in that vein for perhaps ten more minutes, and then decided to quit before he talked himself hoarse. His standing ovation was punctuated with cheers and bravos. He noticed that Odielle's clapping was rather feeble and halfhearted, and that her pinched expression seemed even tighter than it had been all morning — could it be she'd seen him exchange intimate glances with Arcadia, even knew something about his trysts with her? The thought made him tingle with a kind of giddy excitement.

But later for that. The show wasn't over yet, not until his Southeast Asian business associates — his benefactors, as they would have preferred to be considered — saw him run through his greatest hits. Doubtless, they would be watching and listening for them in front of their television screens.

Caine stood quietly until the crowd subsided, then announced that he would be taking a few questions from the press corps.

Predictably, the first one shouted at him had nothing whatsoever to do with his gift to UNICEF, or his challenge to the rich, or his crusade to put the deprived youngsters of the world on-line.

"Mr. Caine, as you know, the Morrison-Fiore bill will be signed into law the day after tomorrow." Caine recognized the reporter from the network newscasts; he had a scoop of dyed brown hair and an alliterative name. "Could you please give us your thoughts about that, and also about the fact that Roger Gordian is expected to simultaneously hold a press conference in Washington to declare his continuing opposition to the President's relaxed encryption policies."

Caine looked thoughtful. "I respect Mr. Gordian for his tremendous past accomplishments. But he has already expressed his views on the subject, and the people have voiced their grassroots opposition through their elected representatives. This is about our children and our grandchildren. About the future. Regrettably, Mr. Gordian has turned his eyes in the opposite direction."

"If I may follow up, sir… as the bill's most vigorous proponent in the public sector, will you be going to Washington for the signing ceremony?"

"I haven't yet decided." Caine manufactured a smile. "The President has been gracious enough to extend an invitation, but one day a week in the spotlight seems like plenty to me. Quite candidly, I've had enough of hotel rooms and am itching to get back to work."

The reporter sat down and a second man sprang to his feet.

"Do you believe there's any link between Roger Gordian's stance on the encryption issue and UpLink's diminishing stock values?"

Beautiful, Caine thought.

"That's a question better asked of an investment banker than a software developer," he said. "I'm really not here to speculate on my colleague's business difficulties. But if I may argue the obvious, the fortunes of any technology firm rise or fall on the willingness and ability of its leaders to look ahead rather than behind them." He paused. "Now, if we may get back to the children's initiative I've proposed today…."

But of course they didn't, which was exactly what Caine had wanted and anticipated. In the remaining minutes of the Q and A, Roger Gordian's name was mentioned half a dozen times, mentioned until he almost became an unseen presence at the press conference.

But not a participant to it, Caine thought. Today the floor was his, and his voice alone was being heard.

Engrossed in his own performance, he called on another reporter.

The future indeed.

That was very much what it was all about. "Roger—"

Putting his hand over the phone, Gordian looked up at his wife as she appeared in the doorway of his study, wedged the receiver between his neck and shoulder, and held his pointer finger aloft.

"Just a minute, hon."

"You said that twenty minutes ago. Before you called Chuck Kirby."

"I know, sorry, we tend to get long-winded," he said distractedly. "Right now, though, I'm just buzzing the airport. I intend to fly the plane into Washington for the press conference, and want the mechanics to check it out… "

Ashley gave him a look that meant business. "Gord, what do you see in front of you?"

He cradled the receiver. ' 'A wonderful but increasingly impatient spouse?"

She still wasn't smiling.

"Gorgeous, too," he said, knowing he was in for it.

"It's been three hours since I came home from the salon with shorter hair and blonder highlights than I've ever had in my life, and you've been holed up in here the entire time, too busy to notice," she said. "This is Saturday. I thought you were going to take the evening off."

He didn't say anything for a moment. Three hours since Ashley came home? Yes, he guessed it was. The afternoon seemed to have raced past before he'd managed to get a handle on it. As had the six months since his continual absorption with his work, his calling as she referred to it, had brought them to the brink of divorce. Always, he seemed to be trying to catch up. It was only after the murders of his dear friends Elaine and Arthur Steiner in Russia — a hail of terrorist gunfire having ended their lives and thirty-year marriage without reason or warning — that Gordian had awakened to what a gift he had in Ashley, and realized with terrible clarity how close he was to losing her. A half year of intensive counseling and earnest commitment had helped bridge many of the rifts between them… but every now and then there were marital ground tremors that reminded him the bridges weren't all that steady. Not yet, anyway.

"You're right, that's what I promised." He stretched his neck to work out a kink of tension. "I apologize. Do you suppose we can start over from here?"

Ashley stood there in front of his desk, a trim, elegant woman whose youthful good looks had made no discernible concessions to early middle age, her sea-green eyes very still as they met his gaze.

"Gord, listen to me," she said. "I'm not a pilot. I don't even like to sit near the window in a passenger plane and be reminded there are clouds underneath me, rather than over my head where they belong. But you've always told me how being in the cockpit of a jet frees up your mind, gives you a feeling of perspective and… what's that term you use? Ambient space?"

"Either that or altitude sickness," he said, smiling wanly. "You're a good listener, Ash."

"It's my best quality." She slowly crossed the room to his desk. "That space you talk about… it's a kind of luxury that you afford yourself, and I'm glad you're able to do it. But sometimes I'm also a little jealous of it. Do you understand?"

He looked at her.

"Yes," he said. "Yes, I do."

She expelled a long sigh. "I'm not blind to what's going on. I read Reynold Armitage's latest bunk in the Wall Street Journal I hear you and Chuck talking about stock sell-offs. I saw your face when the evening news carried Marcus Caine's remarks about you at the U. N. And I can imagine how it must sting."

Gordian started to answer, then hesitated, his brow furrowed, his lips pressed tightly together. Ashley waited. It was his nature to hold his thoughts in close, and she knew he often had difficulty raising the lid on them.

"I once met a snake-oil advertising man who would've called Caine's tactics a pseudo advocacy campaign," he said at length. "Or pseudo adversary campaign, it depends. He's been running both at once, you see. The basic idea is to use a public issue to gain attention for your firm, while promoting certain corporate agendas without being overt about it. You get the target audience to notice you by creating or stepping into a controversy, and then slip in the message you really want to convey between the lines. It's the marketing equivalent of a stage magician's top hat and cloak."

"And Marcus's so-called Children's Challenge obviously would be an example of the first type of campaign."

"A perfect example. Gives him an aura of take-charge philanthropism, a moral platform that's virtually attack-proof. You know anybody who's against kids?"

She gave him a faint smile.

"I can think of a few times when our own bugaboos were young that we almost qualified, but you've made your point," she said. "The pseudo adversary campaign…

that would be his dispute with you over the crypto bill, wouldn't it?"

He nodded. "If you're going to play this sort of game, the potential rewards should always outweigh the risks, and Marcus is well aware that the issues surrounding encryption really don't excite much public reaction. The average person doesn't see how relaxing export controls is going to make any difference in his daily life. Nobody cares except special-interest groups within the high-tech industry on one side, and the law-enforcement and intelligence communities on the other."

Ashley paused to digest it all.

"The strategy behind the UNICEF crusade isn't too down-deep," she said finally. "Let's give the kids computers and sell more Monolith software and have everybody feel good and pat themselves on the back. But what's he trying to achieve by taking you on over encryption? I don't see the… the subtext."

Gordian shrugged a little.

"You've asked the million-dollar question," he said in a vague tone. "And I'm not sure I can answer it."

Silence filled the room. Ashley realized he was sinking beneath it again, and leaned forward, lightly touching the fingertips of both hands to the edge of his desk.

"I understand how you feel, Gord," she said. "Do you accept that as a given?"

The question caught him by surprise.

"More than just accept," he said in a quiet voice. "Knowing that you understand… it's like a prize I've won without quite being sure how I did it, or whether it's even deserved. It makes me stronger than I'd be if I didn't know."

She smiled thoughtfully, looking straight at him. "I'd never, never want to minimize your difficulties, or suggest there's anything in the world I wouldn't do to help you with them. But what I was starting to say before…"

He studied her face in the brief pause. "Yes?"

"I was going to say that if you'd put those problems away for a few hours, if we could share some of the space you get up at thirty thousand feet right here on the ground, together, I'd trade UpLink, this house, our cars, every cent we have, everything we own. Or do you always have be to alone in the pilot's seat to let go?"

There was more silence. Ashley thought she could see the detached, inward-looking expression gradually lift from his features, but wasn't sure. Perhaps it was only wishful thinking.

She came close to exhaling with relief when he slowly reached out, covered her hand with his own, and let it rest where he'd put it.

"Let's go out to dinner, you name the restaurant," he said. "Your enchanting new haircut deserves to be viewed by one and all."

She smiled gently.

"You may have noticed," she said, "that my membership at Adrian's spa and beauty salon wasn't among the things I indicated a willingness to surrender."

He looked into the oceanic greenness of Ashley's eyes and smiled back at her.

"I very well may have," he said.

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