O’Reilly’s house of cards is shaking

Time magazine November 2007

We will have a completely different type of Waterford. Waterford Wedgwood will be a very profitable business in eight to 12 months.

This was Tony O’Reilly’s prediction to the prestigious Time magazine, along with a bullish claim that the newspaper industry was “growing quite slowly, but it is growing.”

Now the predictions have turned to sand.

“Problems at Waterford Wedgwood come at a unfortunate time for Sir Anthony, who is also grappling with €1.4 billion of debts at Independent News & Media (IN&M), his ( separate) media group. Although the two companies are entirely separate, both are under pressure, with IN&M trying to offload its Australian business to reduce debts.”

No one can say that the boss of Irish and UK Independent newspapers including the Belfast Telegraph, ducks a challenge. But with cost-cutting proceeding apace, is the time coming close for predator Denis O’Brien to strike or form an unholy alliance with O’Reilly? The odds on a sale even of shrinking cash cow the Belfast Telegraph must gradually be shortening, as O’Reilly’s house of cards, already fragile before the onslaught of recession, starts to wobble.

  • Belfast Gonzo

    I wonder if Denis is in any better financial shape than O’Reilly. And who would buy any newspaper at the minute? Even fewer than those who buy Irish china that isn’t made in Ireland.

  • Gonzo,

    … Irish china that isn’t made in Ireland …

    Wedgewood doesn’t market itself as ‘Irish’ any more than the English Indo does. It trades on its tradition, straight from Josiah himelf. And that’s part of its problem – it looks stuck in a rut.

  • Greenflag

    This may be sad ending for two companies with a long tradition in the manufacturing history of these ‘islands ‘ unless a buyer is found . Wedgewood China goes back to Josiah Wedgwood and the Potteries District of Staffordshire . The original Wedgwood was one of the founders of the ‘Lunar Society’ that progressive bunch of mainly English ‘intellectuals ‘ who got together to discuss the newest findings in the science etc in the mid to late 18th century iirc . Many of these china companies have gone into liquidation since as far back as the 1980’s . Waterford’s reputation is of more recent vintage although it’s marketing arm has made much use of tenous historical links with cut glass production in Ireland several centuries ago . Arklow pottery is also long since gone .

    Is Beeleek in Fermanagh still holding out or does anybody know .

    I hope they can find another buyer so that the tradition can be maintained however given the present economci slowdown the appetite for ‘luxurious’ china has been dampened and anyway the Chinese can produce excellent china for a tenth of what it costs ‘europeans ‘ or americans . I doubt if the USA have even one major manufacturer of any size left in this industry which at one time used to employ iirc some 100,000 people in the Potteries in Staffordshire and surrounding areas .

  • Why am I still a UUP voter?

    Tony O’Reilly: created jobs, not hundreds, not thousands, not even tens of thousands, but with the expansion of Heinz, hundreds of thousands.

    Brian Walker: public sector parasite, whose pension private sector employees, you know, like those who had jobs O’Reilly helped create, have to pay, whether they like it or not.

  • Rory Carr

    “…a bullish claim that the newspaper industry was “growing quite slowly, but it is growing.”

    Not only ‘bullish’ but also another word, quite close but with an additional consonant, springs to mind. But then a huxter must talk up his wares.

    Oh, and do we really have to put up with the semi-literate UUP yahoo above?

  • GreenflagIs Beeleek in Fermanagh still holding out or does anybody know.

    Yeah, Belleek is still hanging in, but god knows why. Apart from the sentimental US market, I cannot see why anyone buys their stuff.

    Your point re the Chinese is off the mark. In fact they are at a disadvantage in the European markets for porcelain. Most of it is produced in labour-free hi-tech factories that give China no advantage, and the shipping costs from China are crippling. As an example, IKEA have recently awarded an enormous order for cheap china to a European manufacturer. I’ve seen the production line and its impressive – staffed by about three people! Even the hi-tech machinery used to make the porcelain is European (German).

  • Harry Flashman

    “Oh, and do we really have to put up with the semi-literate UUP yahoo above?”

    To be fair Rory, UUP makes a valid point, every poster here drones on about how the economy is failing and the need to invest in industry and employment yet when men like O’Reilly and others (Sean Quinn, Michael O’Leary come to mind, even the late TBF Thompson in another thread) actually risk their money and work day and night to make a success of their businesses there is almost unanimous sneering and begrudgery hurled at them from people who have usually spent their entire working lives sponging off the tax payer and sucking at the public tit.

    Do we actually want private enterprise to succeed or should all Irish entrepreneurs just feck off to the States or Singapore or somewhere where they might actually be appreciated?

  • jack

    ‘Yeah, Belleek is still hanging in, but god knows why. Apart from the sentimental US market, I cannot see why anyone buys their stuff.’

    I think the workers in the Fermanagh factory are on a three/four day week at the moment.A lot of Belleek’s new ranges are made in China and shipped into Ireland.

    Horseman

    They have several ranges currently in the market and some seen to be doing quite well (made in China and shipped into Ireland)

    http://www.newsletter.co.uk/business/It39s-beginning-to-look-a.4772924.jp

  • jack,

    … some seen to be doing quite well …

    I guess everything is relative. I’m familiar with the Europrean ceramics industry, and to say that Belleek is barely a bit-player is being kind to them. They are an utter irrelevance. I predict their demise sometime in the not-too-distant future.

  • Ri Na Deise

    ‘Sir Antnee’ turns everything he touches to shit. He has run the longest standing business in Waterford and one of the oldest in Ireland into the ground. He should be run out of the country and he can take his west brit rag with him.

  • Belfast Gonzo

    Horseman

    Oops. I meant crystal (a reference to how Waterford comes from eastern Europe).

  • Jimmy Sands

    These job losses appear to have made some people very happy indeed.

  • Rory Carr

    “…when men like O’Reilly and others (Sean Quinn, Michael O’Leary come to mind, even the late TBF Thompson in another thread) actually risk their money and work day and night to make a success of their businesses”

    But what they actually risk, Harry, is capital which is no more or less than the stored up excess labour value that has been witheld from earlier labour power. Their money,yes – the laws (their laws) insist – but not their wealth; that wealth was created and extracted from the labour power of the workers who produced that from which the capiatlists increased their capital through profits.

    That is the iron law of capital and I am surprised that you still pretend to be unaware of it, or like most cheerleaders for anti-human capitalism, simply pretend to so do.

  • Jimmy Sands

    Of course if there were still any surplus value knocking around they wouldn’t be closing. Perhaps the staff should reimburse him?

  • Seán

    He is already a tax exile.

  • Why am I still a UUP voter?

    Goodness, yet more nasty, personal attacks. Perhaps if the blameless victim this time – the bould “Sir” Tony – had had the nous to post here on Slugger under his own name, then the politepolitzei would rush to his defence and remove all of, as our Dub friends might put it, de filth too? Or can this really be a service reserved just for ‘substantial’ Jeff Peel? Is there a sort of blog insurance one can take out to avail of this facility?

  • Jimmy Sands

    Tony O’Reilly is Insufficiently National. There can be no worse crime.

  • Mack

    Rory Carr
    But what they actually risk, Harry, is capital which is no more or less than the stored up excess labour value that has been witheld from earlier labour power. Their money,yes – the laws (their laws) insist – but not their wealth; that wealth was created and extracted from the labour power of the workers who produced that from which the capiatlists increased their capital through profits.

    Rory, you can’t actually believe this? Someone has to bear the risk of not getting paid – or going bankrupt. Employees don’t do it – it’s the very definition of an entreprenuer (risk bearer).

    Surely, you would allow workers to store the fruits of their labour for future use? It’s a small step then to allow them invest their claim on future labour efficiently so as to provide a good return? All they need do is open a deposit account at a bank. Individually workers savings may be small, but in the aggregate they are huge. Channeled efficiently to entreprenuers via banks they are a positive force for progress.

    That capitalism is debased into cronyism, corporatism and worse by some should not mean we throw the baby out with the bath water.

    We need innovators, risk bearers, disruptors and crucially creative-destruction to drive living standards ever higher. None of these things are easily achievable in a centrally planned economy – vested interests block whenever they can.

    Can you imagine a government beaurocrat inventing the mobile phone, personal computer, or i-pod?

    Alan Greenspan tells of seeing out-dated farm machinery – some of it more than 70 years old – on his first trip to Soviet Russia. Why are they still using that he asked? Because it works was the reply. Without legally protected property rights (incentive), individual access to capital or credit there can be no creative destruction, no disruption of what is good with what is better.
    Living standards may creep upwards or lunge downwards under politburo organised “great leap forwards”. But only competition will drive technological innovation ever faster.

    If the goal is higher living standards for all – or even just for the poor – I give you Chinese leader Deng Xiaopeng

    “Black Cat White Cat It’s a Good Cat if it Catches the Mouse”

    Capitalism catches the mouse – socialism does not.

  • Greenflag

    horseman ,

    ‘I’m familiar with the Europrean ceramics industry, ‘

    Where is still exists ? Germany , Italy , Spain – Of course most of the larger european countries used to have large manufacturers who supplied both the high and low end of the mass market . The Italians were and still are known for their tiles but now Spain and Brazil and others have caught up .

    The fact that Belleek appear to be have some of their production ‘outsourced to China and probably just add the ‘decoration ‘ etc at the home plant is indicative . The highest cost for these business is labour and energy . The plant you mention which is high tech (three employees) won’t be a major player in increasing ’employment’ in whichever country it’s located in.

    To be fair to Tony O’Reilly even he did not foresee a major downturn like the present . He remains regardless of the Waterford Wedgwood outcome one of Ireland’s most successful businessmen .

  • Jimmy Sands

    “Can you imagine a government beaurocrat inventing the mobile phone, personal computer, or i-pod? ”

    Wasn’t Einstein a government beaureaucrat?

  • Mack

    Jimmy Sands
    Wasn’t Einstein a government beaureaucrat?

    In a Capitalist system 😉
    He did his science at home anyway.

    The Russians were pretty keen on science too. That doesn’t mean they brought many standard of living enhancing products & services to market.

  • Rory Carr

    Surely, you would allow workers to store the fruits of their labour for future use?

    Not only would I allow it, Mack, I would positively encourage it. What I would demand however is that the worker not be denied the greater portion of the fruits of his labour power as is the prevailing practice where the capitalist witholds it, claiming that all profit belongs only to his capital to be deployed at only his whim. (And, boy! look where the exercise of that whim, or ‘prudent judgement as he would have it, has landed us today). This applies in the form of executive proxy decision by the board in the case of public corporations – Harold Geneen of ATT was as much of a monolithic, undisputed tyrant (and thug) as was ever the Emperor Bokassa and beside him Genghis Khan was a gentle, compassionate leader.

    And do keep a lookout for what you call ‘the continuing rise in living standards’ over the coming months and years that is if you are not so young as to have to be keeping a lookout for ‘incoming’ from whatever enemy your boss-class has conjured up to keep your mind off such troublesome concerns as rent, food, education and health care for you and your family. Yes it really is that bad. They really, really have fucked it up this time.

    (Submit word :Red. Wouldn’t you bloody know?)

  • David

    I was helping a friend clean out the basement in Eastern Europe a few years ago when we discovered a big old TV, with lots of transistors and the like. I thought wow a relic from the early 70s. My friend however pointed out that this was actually a state of the art USSR TV from about 1990 when they decided to upgrade the consumer goods in the dying days of the Soviet bloc. It didn’t work, of course.

    He also had a computer from the same time that was an illegal USSR copy of the ZX Spectrum in a different box (it did have a better keyboard though made in 1982 in the west). The march of technology is was not fast under the socialist system.

    Without capitalism innovation dies.

  • Jimmy Sands

    “claiming that all profit belongs only to his capital”

    What do you think the word “profit” means?

    And I believe O’Reilly started out as a wage slave too.

  • cynic

    Absolutely right. Let’s drive out all these capitalists who have invested in Ireland to exploit the workers and make money on our backs.

    Sure every cloud has a silver lining and we will be free of their capitalist ways like regular meals, foreign holidays and decent housing.

    So its back to the plough or the church lads. Sure those rickets weren’t so bad after all and the chances of the blight coming back aren’t that high and there’s a real shortage of priests.