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Files.cwa-union.org

2012 YP, SEA
COMPANY OPENING REMARKS - MORGAN
Let me begin by welcoming everyone to the 2012 bargaining session. A lot has changed in since we last sat down to bargain. In fact, a lot has changed in just the past two months. This Company is not the same Company that you worked for 2 months ago. It may not seem like a lot has changed in your everyday work, but it’s important to understand that this Company is very different than it was before. First of all, YP has a new owner. In May 2012, AT&T sold YP to private equity firm Cerberus Capital. As the majority owner of the Company, Cerberus is committed first and foremost to getting a solid return on its investment. Cerberus has a strong track record in operating ailing companies such as YP, and turning them around. And it has an aggressive plan to turn YP around. But there is a relatively small window of time for them to do this. If the business does not start showing signs of life in the short term, there won’t be a business in the long term. What has also changed is how the Company derives its revenue – All we have now is our print and Internet advertising revenue. We don’t have mobility revenue, nor wireline revenue, to fall back on. There is no AT&T to come and pump money into this business if it’s failing. We have no safety net. So what’s changed business-wise? Unfortunately, not much yet. As Bill Ridgeway will be describing in a brief presentation about the state of the business here in the Southeast, we are still sliding. Our revenues in the Southeast alone are down nearly half, by almost $500 million, since 2008. Our EBITDA margin, or the percentage of actual earnings, is the lowest among out key competitors. And not surprisingly, our employee Headcount has dropped nearly 30 percent in under 4 years. We are now One Company, and One Team, for One Mission. That Mission is to create an industry leading sales organization and reverse our negative trends. But we need to create efficiencies. We need to operate differently and we need flexibility in our collective bargaining agreement to help make that happen. Because our competitors are making it happen – DEX One and Supermedia both operate at higher margins, which means they operate more leanly and efficiently. I look forward to working with you over the next month. As you all know, we have our work cut out for us. We need to address issues that are causing us to lose in the market place. We need to position the Company to execute on our business imperatives. We must prepare this Company for the future - which can not look like the recent past. There are many obstacles to transforming the business. We must negotiate a contract that overcomes those obstacles. So, what is my message as we start these very critical negotiations? • First of all, I am excited to be here. • We are at a critical juncture in our company and our industry. • Our company is in a crisis and we are all in a fight for our lives. • Consequently, we are at a point where, as a bargaining team, we have an opportunity to positively, or negatively, impact the future of our company and the lives of our employees and your members. • The decisions we make over the next few weeks will determine the • 3 years ago, when we last bargained, we were part of a huge conglomerate and the yellow pages was worth about $4.7 billion in revenue. Since then, our • In 2009, we had almost 900,000 customers. This has dwindled to around • And, in 2009 we were made up of over 10,000 employees. Today, we stand • Our Culture is Nimble, Entrepreneurial, and Decisive • We are a High Performance Sales Organization • BUT, The Future is NOW in OUR Control • We, as bargainers, have a unique opportunity. • An industry analyst recently said that “a successful future for Yellow Pages will include evolutionary changes such as transitioning online to IYP, embracing
transparency, pay-for-performance, user-generated content, publishing cycle changes, pricing model changes, and sales process changes.” • However, I contend that revolutionary change – not just evolutionary - will need
to be embraced right now to truly seize the opportunity. • We will need to think back to our origins and rediscover the essence of what made us the most valuable source of advertising to our customers. • I am confident that we will rise to the occasion • I am confident we will accomplish revolutionary change in these negotiations,
• I am excited to be here and happy to be working with you! I am hopeful that we can collectively do the hard things that will need to be done to get this business back on track and provide us all with a more secure future in a

Source: http://files.cwa-union.org/district3/MorganOpeningRemarks.pdf