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Cellular Phone Safety Concerns Hammer
Stocks
IT IS
EASY TO PINPOINT THE MOMENT THAT SET IN MOTION THE CHAIN OF
EVENTS THAT CAUSED WHEELER TO PUT CARLO IN THAT JOB—AND
EVENTU¬ALLY RESULTED IN AN EPIC COLLISION OF SCIENCE AND
POLITICS.
IT WAS
JANUARY 21, 1993, AND WASHINGTON WAS ALIVE WITH NEW
BEGINNINGS.
A NEW
PRESIDENT HAD JUST BEEN INAUGURATED. A NEW CONGRESS HAD JUST
BEEN INSTALLED. AT BOTH ENDS OF PENNSYLVANIA AVENUE, THE
POWERS OF THE NATION'S CAPITAL WERE STILL CELEBRATING THEIR
GOOD FORTUNE. BUT AT CTIA HEADQUARTERS TOM WHEELER, THE
NEWLY APPOINTED PRESIDENT AND CHIEF LOBBYIST OF THE POWERFUL
TRADE GROUP, WAS SCRAMBLING HIS TROOPS IN AN EFFORT TO STAVE
OFF AN INDUSTRY CRISIS AND , IN FACT, A NATIONWIDE PANIC.
On this politically
charged day after Inauguration Day, CNN talk-show host Larry
King wound up making major news by booking a guest who had
nothing to do with politics at all—a private citizen from
Florida whose story ignited a crisis that would shake the
power brokers from Washington to Wall Street. David Reynard
of Tampa, Florida, told Larry King why he was filing a
lawsuit naming cell phone industry companies as defendants.
Reynard was alleging that his late wife, Susan, had suffered
a fatal brain tumor due to her repeated use of her cellular
telephone.
"Suit Over Cellular
Radiation Raises Hazard Questions," said a headline in The
Los Angeles Times.
"Cellular Phone Safety
Concerns Hammer Stocks," said The Wall Street Journal. In
the week following that Larry King Live interview,
Motorola's stock prices dropped by $5.37 to $50.50 after a
brokerage house lowered the stock rating for the nation's
largest cellular phone manufacturer. And stock prices for
cellular service provider companies dropped as well: McCaw
Cellular stock fell $2.87 to $33, and Fleet Call stock fell
$1.62 to $20.52.
Meanwhile, the cellular
phone industry had its own headline spin: "CNN Runs Scare
Story," the CTIA Newsletter had dismissively declared. But
the industry's problem was that the story really did seem
scary to millions of cell phone users. News of the lawsuit,
and its hard-to-prove claim, quickly became a national and
international news sensation. It triggered an instant
inquiry from a subcommittee chairman in the U.S. Congress,
and it quickly caught the attention of an even more powerful
and influential opinion-shaper: Jay Leno made it part of his
late-night TV comedy monologue. Before the year would end,
Tom Wheeler would write a memo to his top advisers that
aptly characterized his beleaguered industry's view of its
public enemy: "The Hydra-Headed Cancer Scare." |
