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BLOG: Justin Beiber, The iPhone 5, Zombies, and Collusion in Silicon Valley

Mark Gibbs | May 27, 2011
A collection of big companies in Silicon Valley colluded, twice, to screw employees. Color me disgusted.

Justin Beiber. The iPhone 5. Zombies. You only have to mention any of those pop icons and it's a news free-for-all. But try substantive news about how big tech companies misbehave badly. You'll get hardly anything.

Consider, for example, the recent revelations that a handful of major Silicon Valley firms -- Adobe, Apple, Disney Pixar, Google, Intel, Intuit, Genentech, and Lucasfilm -- conspired to limit the salaries of their top employees.

No, not the salaries of the top executives ... d'oh, that'll never happen. No, I mean the salaries of senior technical people; the people creating core systems and software. In this case the in-depth press coverage has been limited to the trades and a few quickly forgotten mentions in the mainstream press.

Now, it's not as if this kind of collusion is something new. Oh no, these guys had been caught doing this kind of stuff before. In 2010 the Department of Justice settled with Apple Google, Adobe, Pixar, Intel, and Intuit over a deal that essentially added up to a "no poaching" agreement. The companies had agreed to not cold call each other's staff with employment offers. And that agreement went back at least as far as 2005!

According to the DoJ "senior executives at the companies actively managed the deals" but, according to Google "it made the agreements not to cold call employees at Apple, Intel and Intuit in order to maintain a good relationship with the companies."

So, let's be clear; one of the most powerful companies in the world, to wit, Google, was afraid of antagonizing smaller companies. Really? What kind of wimpy buffoons run Google?! What would Apple have done to Google? Stolen their lunch money? Beat them up behind the bike shed after school? What a load of crap.

Part of the problem was that a number of people sit on two or more boards of the companies involved. Cnet reports: "Google CEO Eric Schmidt sat on Apple's board, and former Genentech CEO Arthur Levinson sat on the boards of both companies. Bill Campbell is currently a director on both Intuit and Apple's boards and played an instrumental role in helping Google get off the ground. Paul Otellini, Intel's CEO, currently sits on Google's board of directors. And, of course, Apple founder and CEO Steve Jobs also founded Pixar, and sat on its board of directors until selling the company to Disney in 2006."

So, in September last year, the result of the DoJ investigation was that the various companies involved agreed to stop behaving badly and to stop not cold calling prospective employees working for each other ... all without admitting any wrongdoing! This is like young Master Washington saying "yes, I cut down the cherry tree but you can't punish me because I 'fessed up." Baloney! You cut down the damn tree! You are grounded mister!

 

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