Problem:
Your company, Netcast Communication began as a traditional Cable Television provider in the early 1970 in rural Washington State. Today, it dominates cable, internet, satellite and telecommunications services in 16 western states. Over the past 35 years, it has developed patented equipment and services (including a revolutionary 4G device that downloads programming anywhere in the world), franchised technical support and service centers across North America, and it acquired local cable systems to build an empire many have called "unfair competition" - a monopoly.
Monopoly or not, investors are enjoying a significant return on their investment and they're happy.
As a cable industry pioneer, Netcast pursued a growth strategy to acquire related business and develop new uses for its services. As a result, it now owns a media production facility, AM and FM radio stations, six metropolitan daily newspapers, 15 multi-screen cineplex movie theaters, and an online store for televisions, computers and other related products. It also established its franchise business to consult with other cable operators across North America and holds contracts with multi-national corporations to provide corporate video and television programming and networks.
Put simply, Netcast gets some revenue from virtually every cable, internet, or telecommunication program and service purchased by consumers or businesses in North America.
In 2005, ABI Media Enterprises, a relative newcomer, filed an anti-trust lawsuit with Justice Department against Netcast claiming Netcast's market dominance is illegal and represents unfair competition; a monopoly. Netcast responded by saying "that's ridiculous." In its defense, Netcast has argued that their exclusive territory, franchise agreements, and patented products and services, and media group are justified to recoup their considerable research and development costs.
After years of endless motions and hearings, a judge announced this morning that Netcast is indeed a monopoly and that the company will be severely punished. Investors and industry experts believe Netcast will be forced to sell off its movie theaters, media group, franchising and consulting businesses and its exclusive cable networks. It will also be forced to allow competitors like ABI to use its existing cables a reduced rates effectively opening up once exclusive business to free market competition.
You are responsible for financial communications at Netcast. What communications approach do you take to preserve the value of Netcast's stock?