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    Carbonite and Howard Stern

    Carbonite and Howard Stern

    As detailed yesterday, the Media Matters employee spearheading efforts to pressure advertisers to stop advertising on the Rush Limbaugh show considered the March 3 Saturday night announcement by Carbonite that it was ceasing all advertising on Rush’s show to be a turning point.

    Just the day before, on March 2, Carbonite’s CEO David Friend had issued a statement which reiterated Carbonite’s long-standing policy that it did not consider its advertising an endorsement of a talk show host’s views.  Friend noted in that March 2 statement that  “I have scheduled a face-to-face meeting next week with Limbaugh” to discuss the issue, but that the pressure was “the worst we’ve ever seen.”

    Carbonite’s policy of staying out of politics was critical because its business strategy was tied to talk radio, including numerous controversial figures.

    In an April 2011 interview (h/t commenter Eliot Ness), Friend revealed how important Rush was to Carbonite, and how Carbonite entered into that relationship fully aware of the controversies of Limbaugh and other Carbonite endorsers, such as Howard Stern (emphasis mine):

    Andrew: One of the shows that you’re on is the Rush Limbaugh show, very controversial. Why aren’t you afraid to be associated with that kind of controversy?

    David: Well, we’re also with Rachel Maddow and Ed Schultz.

    Andrew: I see.

    David: We’ve pretty well booked up every major talk radio show host in the country, who knows how to sale. Over 40 of them. It included Howard Stern, I mean it’s the whole gamut. So when we started going down this path I said, “Look, I’m  going to go crazy if I have to sit here and parse the politic leanings of all of these radio show people, because some of them are left some of them are right, some of them are just crazy, and forget it, all I care about is I’m going to give you the money, you’re going to use Carbonite yourself, because we don’t want people talking about Carbonite unless they’re actually users. I’m not going to give you the subscription for free, they’ve got to buy it, and they have to talk about it from the heart. I don’t want any canned commercials. So when it comes time to talk about Carbonite, you stop talking about politics or whatever you’re talking about and you talk about Carbonite for a minute. And that’s all that matters around so if you can sell Carbonite and convince people that you use it, you love it, and you should go try it. If you can do that, we’re going to continue to support you.”

    Andrew: And the reason you went down that direction is because you want the reputation of the person who’s on the show to influence the decision of their fans, you want an endorsement?

    David: Their fans trust them.

    Andrew: Right.

    David: And with good reason. I mean, Rush Limbaugh will not advertize any product. He’s spent a good deal of time trying Carbonite, thinking about it, because his reputation is on the line, as are all the other talk show hosts. I mean, Howard Stern, Rachel Maddow.

    Andrew: For me it’s Leo Laporte. I hear all the time talk about you.

    David: Yeah, these people used Carbonite and they really liked it. When I go down and visit these guys, they want to know how the company’s doing, they want to see all the new products. And can remember sitting with Rush Limbaugh, showing him how he could access all of his files on his iPhone and he was like, “Holy mackerel, that’s what I’ve always wanted.” He said, “I can be anywhere and get anything on any of my computers.” And he had like five Macs, he’s got one at home, he’s got two in the office, he’s got one here, one there. And he doesn’t have to worry about leaving them on anymore. He can get to 100% of all of his stuff no matter where he is. And so he gets excited about that stuff and then when he goes on the air and talks about parley, he’s genuinely excited about this product and it come through in the delivery. You can tell when you’re hearing these guys talk that it’s not soap or something he really doesn’t care about. It’s a cool product and they like it.

    The March 3 Saturday night Carbonite press release announcing that Carbonite was breaking its relationship with Rush emphasized concern for Friend’s daughters and civil discourse:

    A Statement from David Friend, CEO of Carbonite as of 6:45pm ET, March 3:

    “No one with daughters the age of Sandra Fluke, and I have two, could possibly abide the insult and abuse heaped upon this courageous and well-intentioned young lady.  Mr. Limbaugh, with his highly personal attacks on Miss Fluke, overstepped any reasonable bounds of decency.  Even though Mr. Limbaugh has now issued an apology, we have nonetheless decided to withdraw our advertising from his show.  We hope that our action, along with the other advertisers who have already withdrawn their ads, will ultimately contribute to a more civilized public discourse.”

    What changed from Friday, March 2 to Saturday, March 3?  Why didn’t Friend wait until the following week to meet with Rush, as he stated he would do in his March 2 press release?  Given the carnage to Carbonite’s share price, Friend owes shareholders an explanation.

    Carbonite also has to explain its double standard.  There has been a lot of attention to the fact that Carbonite still maintains relationships with Ed Shultz and other liberal talk show hosts who engage in personal attacks and uncivil discourse directed at conservatives.

    But the connection to Howard Stern has not received much attention.

    Stern is notorious for his demeaning antics towards women, including highly sexualized episodes on his show for decades.  Yet none of that seems to bother Carbonite.

    Stern also is vicious towards conservative policians such as calling Sarah Palin “a big f-ing crybaby”, “you f-er,” “you c–t” (NSFW):

    Yet Carbonite continues to promote its product through Stern and to run spots on his show.  This ad which still is on Carbonite’s website, appears to be for a 2007 promotion:

    I don’t want Carbonite to stop advertising on Stern’s show or to break the relationship.

    I do want Carbonite to admit the obvious, that it gave into pressure from Media Matters and others under implied if not explicit threat of a secondary boycott, not out of concern for our daughters or the promotion of civil discourse.

    [note: the title of this post was changed shortly after publication]


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    Eliot Ness | March 16, 2012 at 7:32 pm


    SEC reports show that the executives of money-losing Carbonite have paid themselves lavishly.

    • David Friend is Carbonite’s founding CEO, President, Chairman of the Board and a major shareholder.
    • In 2010, Friend paid himself $515,203 for overseeing Carbonite’s staggering loss of $496,513 per week.
    • Friend engineered for himself a “golden parachute” worth $2.27 million, 1.6 million shares of stock, and massive stock options. 300,000 options @ $12.88 107,730 options @ $1.31 235,000 options @ $10.36

    Friend has engineered incredibly generous acquisition and severance agreements for himself and his executives — considering that Carbonite loses $100,000 every business day.

    David Friend $ 2,270,793
    Jeffry Flowers $ 1,040,338
    Robert Rubin $ 882,379
    Swami Kumaresan $ 773,465
    Andrew Keenan $ 643,526

    Carbonite executives have received substantial 10-year stock options that will allow them to pick the pockets of shareholders if the stock ever recovers from Friend’s head-on collision with Battleship Limbaugh.

    Eliot Ness | March 16, 2012 at 7:35 pm


    On 8 Mar 2012, at the height of the Limbaugh controversy, Carbonite’s management once again picked its investors’ pockets by conjuring up 1,005,493 shares of stock out of thin air, to be “offered to employees in employee benefit plans.”

    “Options, restricted stock, and all other stock-based and cash-based awards may be granted to individuals who are then our officers, employees, directors, or consultants or are the officers, employees, directors, or consultants of certain of our subsidiaries. Such awards also may be granted to our directors. Only executive officers and employees may be granted incentive stock options, or ISOs.”

    Lorenzo Poe | March 17, 2012 at 8:37 am

    So, a new verb would be ‘fluke’? As in ‘go fluke yourself’ meaning make a grandstand play and watch as your world goes down the toilet?

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