I got a review copy of the new book, Dethroning the King, which is all about the hostile takeover of Anheuser-Busch by InBev, a few weeks ago but haven’t had a chance to read it yet. It looks fascinating and I’m looking forward to devouring it as soon as I can. For now, I’ll have to make do with the Wall Street Journal review of the book, which only makes me want to read it more. Anybody else read it yet? Thoughts?
Fox Business yesterday did an interview with Sam Calagione, of Dogfish Head Brewery, promoting his new Discovery channel show, Brew Masters.
My friend and colleague, John Holl, was fortunate enough to appear on his local cable television station in New Jersey, News 12 New Jersey. He brought along several beers to suggest for the holiday tomorrow, including:
With the announcement that Yuengling Brewery is buying their fourth brewery to continue to expand their market, the Wall Street Journal today has a nice overview of the company’s plans for the future. Check out After 181 Years, Local Beer Stops Playing Hard to Get.
Dick Yuengling (Photo by Scott Lewis)
I’m not sure who moominvillea is, but they appear to have set up a twitter account for the sole purpose of tweeting news outlets about what he’s calling “beergate.” I don’t know much, but apparently “Finnish news anchor Kimmo Wilska [was] reporting on misconduct of bars selling alcohol [and was caught on camera pretending to drink a bottle of beer]. He was fired later at same day.”
According to the Helsinki Times:
The Finnish Broadcasting Company (YLE) has sacked Kimmo Wilska, a newsreader who pretended to drink from a beer bottle during a bulletin featuring a report on alcohol licence inspections on Wednesday.
Wilska had worked for YLE’s English-language service on an occasional basis.
Timo Kämäräinen, a managing editor in charge of the English-language service, said the public broadcaster did not tolerate the kind of behaviour seen on Wednesday in any of its news bulletins.
The UK’s Asylum adds the following details:
In what turned out to be his last on-air report for YLE, Finland’s second-largest TV channel, [Wilska] carried out a rather amusing prank that unfortunately got him oh-so-very-fired.
As you’ll see from the clip below, as he speaks over footage of beers being poured, the camera quickly cuts back to the studio to show Kimmo, beer in hand, the amber nectar dribbling out of the top.
He swiftly puts the boozy beverage down, and carries on with his report. A joke, of course, but his bosses failed to see the funny side, promptly giving him the boot.
Known as ‘Finland’s Barry White’ because of his sonorous voice, a Facebook support group has already sprung up, defending Kimmo for a joke he promises wasn’t meant to be aired, and was solely for the crew’s amusement.
A Facebook support page, the Kimmo Wilska Support Group, as of this evening has attracted over 48,000 supporters. Even the L.A. Times is covering the story.
Below is the video, at least for now. Several sources are saying that YLE is “forcibly remov[ing] the YouTube video claiming copyright law, even though there are GAZILLIONS of other YLE videos on YouTube. They seem to be particular[ly] angry about this one.” If it’s gone, just search his name and you’ll undoubtedly find another version, because I don’t think YLE will be able to shut down all of them now that it’s gone viral.
At first blush, it certainly seems like the television station’s knee-jerk reaction to fire him was a fairly stupid decision.
As I reported yesterday, San Francisco mayor Gavin Newsom kept his promise to veto the proposed ordinance that seeks to add an additional tax on alcohol sold in the city.
Here’s mayor Newsom’s veto letter that he sent to city supervisors:
This letter communicates my veto of the ordinance pending in File Number 100865, finally passed by the Board of Supervisors today, September 21, 2010. This ordinance proposes an Alcohol Mitigation Fee to be imposed on alcoholic beverage wholesalers and others who sell or distribute alcoholic beverages in San Francisco.
I cannot support this unnecessary and harmful new fee that will hurt our City’s economy and cost us jobs at a time when we most need them.
In this economy, I fundamentally believe that we need to be encouraging local businesses – large and small – to continue to work and operate in our neighborhoods, to continue to provide jobs and security to the residents of San Francisco, and to continue to support our City’s economy in its recovery. It is in these times of struggle that we need to stimulate our local economy – not pursue policies that will stifle growth and put our county at a competitive disadvantage with every other county in California.
In addition, while we have faced significant budget deficits for the last three years, we consistently have supported the provision of critical health care services to our residents most in need – at a much higher rate than surrounding counties. And, we will continue to do so. Therefore, I do not accept the premise that, but for this fee, we will be slashing our health care programs.
I also strongly believe that we are in questionable legal territory due to state preemption issues, and that passing this ordinance would risk millions of dollars in attorney’s fees that we can ill afford. I prefer to hold those battles for creative policy areas where we believe we are in strong legal standing.
I remain committed to working with the Board of Supervisors and City departments to continue to identify impactful programs to help chronic inebriates in San Francisco. However, I do not believe that an alcohol impact fee is the best approach in achieving that policy goal. Our best hope for continued strong financial standing of this City and support for public health services is to help our local economy grow and thrive.
The media reaction has been swift and voluminous. At least twenty media outlets throughout the state have weighed in since yesterday afternoon. Here’s what the San Francisco Chronicle, by John Coté, had to say:
Newsom contends the fee would hurt jobs and is illegal, treading on the state’s authority to regulate alcohol.
“You don’t help the city’s general fund by spending hundreds of thousands of dollars on a lawsuit we’re going to lose,” Newsom said.
Other opponents, such as the San Francisco , argue the fee is really a tax and thus needs voter approval. The city attorney issued a confidential opinion to supervisors that warned of potentially significant legal risks associated with the legislation on both fronts. Liquor industry representatives vowed to sue if the legislation were enacted.
And I love this gem. “Avalos said there was simply ‘no evidence’ that consumers would face inflated costs.” Puh-leeze. His insistence that there would be no mark-up on the tax from wholesaler to retailer to consumer is completely naive and disingenuous. Everyone in the business community is telling him the tax will be marked up, but that’s not “evidence.” Does he think they’re all lying just because they don’t like the tax? Has he never worked in any business capacity? That’s what businesses do, they mark up their costs and pass them along to consumers. Not doing so is how you go out of business.
In a provocative article today, the business-oriented website, TheStreet.com, which describes itself as the “leading digital financial media company,” pondered whether Anheuser-Busch InBev might possibly be considering buying the Craft Brewers Alliance (CBA). The piece, by Miriam Reimer, entitled Anheuser-Busch Takeover Target: Craft Brewers Alliance?, certainly had the wags wagging on the blogosphere today.
There’s a great reminder of just how insignificant craft beer is to the business world in the opening paragraph, which refers to the CBA as that “little-known craft beer maker.” Compared to the big two, that’s understandable, but given that the brands in CBA are some of craft’s biggest players, it’s also pretty funny and humbling. But it’s good to remember that what many of us take so seriously is just a very small sliver of a much bigger pie.
At any rate, the idea of ABI buying the CBA was floated by Washington Street Investments president Bryce Peterson. Despite stating that “such speculation is premature,” he had no problem engaging in it himself. The thinking is, apparently, that ABI “might think it’s smart to buy a strong brand in the craft area and use its incredible distribution and marketing strengths to grow the acquired business.” Which sounds good on paper, but that’s exactly the reason that Anheuser-Busch earlier invested in the CBA brands individually, before their merger in 2008. When craft beer was beginning it’s latest growth trend, A-B distributors started wanting to carry some, too, and that drove A-B to partner with RedHook and Widmer to satisfy that demand. As a result, I’m not sure what buying the remaining 64.4% of CBA that ABI does not own would accomplish. The bulk of the article is given over to share prices, quarterly sales, and other business analysis. It’s interesting, up to a point, but all the numbers don’t seem to manage to answer the basic question of what advantage there would be for ABI. Plus, isn’t ABI still trying to trim the fat to pay for buying Anheuser-Busch?
The article concludes with a poll, asking readers to answer the question posed by the title: “Yes — Anheuser-Busch sees long-term potential in Craft’s growing corner of the market” or “No — Anheuser-Busch wouldn’t bother with such a small-time player.” What’s surprising is that as of this evening better than 17% thought “no.” They obviously are oblivious to A-B’s history. I’ve never seen a niche market too small for them try to own or destroy … ever. And InBev is even more ruthless than A-B was, so it’s hard to imagine them not going after craft beer in some fashion. Whether it will be by buying the CBA, at least at this point, is still an open question.
UPDATE 8.26: Author Miriam Reimer did a follow-up article to this one, Anheuser-Busch Thirsty for Craft Brewers, Poll Says, focusing on the poll at the end of it. She contacted me about the piece, and we spoke on the phone for a good half-hour, quoting me briefly in the article on page 2.
I almost forgot about this. The week before last I got a call from the local CBS television station, CBS 5, asking me to comment on a story they were working on regarding a recent Consumer Reports beer tasting that was published in their August issue. In Bargain beer from Costco, they had consumers taste blind the Kirkland brand beers, Costco’s private label beer, with prominent commercial brands of a similar style — Samuel Adams Boston Lager, Samuel Adams Boston Ale, Sierra Nevada Pale Ale, and Paulaner Hefe-Weizen.
The conclusion was that their “untrained panelists liked the Costco beers about as much as the same-style name-brand beers. (For each type, some people liked the Kirkland Signature better, some liked the brand name better, and some liked both equally.) Our consultants said that although the brand-name beers were more flavorful, clean-tasting, and complex, the Costco beers were quite quaffable and, to use the consultants’ technical term, ‘party-worthy.'”
The CBS producer asked me if I was “surprised” by those results. I explained that I wasn’t, and proceeded to tell her about the basics of how a private label beer is created, that licensed commercial breweries work with a retailer to create and brew the beer for them. I did a number of private label lines of beers when I worked at Beverages & more, beers like Coastal Fog, Brandenburg Gate and Truman’s True Brew. We also had a label in development to be called J.R. Brooks to do English styles like India Pale Ale, but I left before it saw the light of day. Anyway, I went on explaining that almost any private label beer done by a good brewery will likewise be pretty good, too. Nothing surprising about it all. It’s simply that most consumers probably don’t think about where the beer comes from, nor should they, I suppose. All that matters is that it tastes good. And then I added, almost as an afterthought, just to hammer home the point that private label beers that come from good homes are usually good beers, that it was Gordon Biersch that created and brewed the Costco beers.
At that point, the producer asked if they could come to my home in Novato and interview me on camera for the story they were working on. I agreed, but they called back and asked if there might be some beer-themed location that might also work. I suggested Moylan’s brewpub, since it’s only a mile or so from my house. We met there, they shot some B-roll of me walking with beer, sniffing a beer, drinking a beer, getting a beer poured. Then they picked a location and we sat down to talk on camera for about ten minutes. As I expected, they used under a minute in the finished story.
The video itself is online, but you’ll have to watch it there as they don’t seem to allow embedding.
You never know how these things will turn out, and the bit they zeroed on on, of course, was that the beer was made by Gordon Biersch. They treated it like a scoop of sorts, though it’s not exactly a secret. Whenever a contract private label beer is made, publicly available forms must be filed with the proper authorities, labels approved, etc. The labels, of course, by law must include the city and state where the beer was brewed, so it’s usually not that hard to figure out who made a private label beer. When you see Paso Robles, CA on a Trader Joe’s beer, you can pretty much guess that Firestone Walker brewed it. So when the Kirkland beers labels read “San Jose, California,” there aren’t too many production breweries in San Jose that could have made it. Really, anybody with just a little knowledge could have figured it out. When the labels were first approved, several people reported the news that Gordon Biersch would be making the Kirkland beers, myself included. I even spoke to Dan Gordon about it briefly at the time. But then they came out, and the news died away, as these things tend to do.
On the TV report, they said they tried to reach Gordon Biersch but got “no comment” so I hope I didn’t “out” Dan in some way that will make life tough for him, though in truth I doubt that’s possible. As I said, who does private label contract beers is more of an open secret, everybody in the beer community knows who does them and the records with the specifics are public. It’s just that the public at large doesn’t usually care enough or have the inside knowledge necessary to figure it out, even if they did want to know.
I think what’s more surprising is that neither Consumer Reports or CBS thought to question who made the beer. In a report about comparing the taste of two different beers, one by a commercial brewery and one a private label beer, shouldn’t that have been the first question Consumer Reports asked: who made the second beer? That would have gone a long way in explaining the result, don’t you think?
A new study was just published online, and will be in print in next month’s journal Alcoholism: Clinical and Experimental Research with the nearly impenetrable title Sociodemographic Predictors of Pattern and Volume of Alcohol Consumption Across Hispanics, Blacks, and Whites: 10-Year Trend (1992–2002). CNN simplified the story’s title, originally from Health.com, to More Americans Drinking Alcohol. To me the most interesting thing about this is that it’s really two stories, one positive and one sort of negative, and it’s all in the way it’s framed.
As presented on CNN, the story begins with mainly the positive aspects of the story. More Americans Drinking (Alcohol) summarizes the study like this:
Between 1992 and 2002, the percentage of men and women who drank alcohol increased, as did the percentage of whites, blacks, and Hispanics, the study found.
Americans don’t seem to be drinking more, however, as the average number of drinks consumed per month remained steady.
“More people are drinking, but they seem to not be drinking heavily as frequently,” says Rhonda Jones-Webb, an epidemiologist and alcohol expert at the University of Minnesota School of Public Health, in Minneapolis.
So that’s good news, especially considering that moderate drinking is healthier for you than abstaining or over-indulging. So if more people are hitting the sweet spot, so to speak, that should be good news, eh?
Oh, but wait, here comes the other shoe:
Yet the study revealed an important exception to that trend: an uptick in the number of people who binge drink at least once a month. Binge drinking is defined as consuming five or more drinks in one day.
“We need to address this increase, which may be associated with alcohol abuse,” says Dr. Deborah Dawson, Ph.D., a staff scientist at the National Institute on Alcohol Abuse and Alcoholism, in Bethesda, Maryland. “We may need focus our attention on preventive measures that target binge drinking.”
Of course the main problem with all that alarm over binge drinking is the definition itself. Five drinks in one day is an absurd way to define binge drinking. Originally it was essentially a bender with no limits. Little by little the definition has been whittled down by organizations and our government keen to have a number they could use in compiling statistics. But that also means a five-course beer dinner creates an event where every single diner is a binge drinker. Even the new Dietary Guidelines just released have changed the standard from daily to weekly allowable amounts and changed the daily standard to four drinks for a male, so long as the weekly limit is not reached. So that means four drinks in one day is fine, but one more and you’re a dangerous binge drinker. It’s this sort of nonsense that allows neo-prohibitionist groups to use suspect statistics with the government imprimatur to give them more credibility than they rightly deserve.
Then there’s this chestnut:
The rise in the proportion of drinkers and in binge drinking could be a sign that society is more accepting of alcohol consumption (and overconsumption), says Dr. Stephen Bahr, Ph.D., a professor of sociology at Brigham Young University, in Provo, Utah.
“There has been much emphasis on drug education and treatment but not as much emphasis on alcohol misuse, which could signal a change in norms and explain the increase in the prevalence of drinkers,” he says.
I don’t know what planet Bahr lives on, but when my kindergartner is lectured to with MADD propaganda that alcohol is a drug and he comes home with the notion that his parents are drug users because they have a beer with dinner, I’d say there’s plenty emphasis on alcohol misuse. It’s absurd in light of all the anti-alcohol propaganda for anyone to suggest people are drinking more because they haven’t heard it might be bad for them. If anything, they’re preached to death.
The original Health.com piece, Survey: More Americans Drinking Alcohol, is under the section heading Alcoholism, subtly framing the story as if it’s about alcoholism, which of course it’s not. More people drinking does not automatically mean there are more alcoholics or even more people at risk of becoming alcoholics. But framed the way it is, that’s what it seems to presuppose.
Some of the other findings, as reported by Health.com:
The study itself only concluded the following, at least in the abstract:
The only common trend between 1992 and 2002 across both genders and 3 ethnic groups was a rise in the proportion of drinkers. There was also a rise in drinking 5 or more drinks in a day (Whites, Blacks, and Hispanics) and drinking to intoxication (Whites and Blacks), but this was limited to those reporting such drinking at least once a month. The reasons for these changes are many and may involve complex sociodemographic changes in the population.
I’m sorry, having five drinks on a given day once a month, or even once a week, is hardly a sign of the fall of civilization, even if a few more are now than they were ten years ago. I’m not even sure it’s all that newsworthy. But for reasons passing understanding — perhaps it’s simply the 24/7 news cycle — it became news and even got picked up by CNN.
USA Today ran an interesting story earlier this month about the dry counties dotting still the landscape, areas within eight states where despite alcohol being legal statewide, it’s still illegal in those counties (along with some specific towns). According to Dry America’s Not-So-Sober Reality: It’s Shrinking Fast, many of the remaining 328 may soon become wet, too.
From the article:
Today, 1 in 9 counties is still dry. But drys are losing ground on all levels, from the state — since 2002, 14 states have ended bans on Sunday alcohol sales — to the very local. In April, a 19-block section of western Louisville (the M-107 precinct) voted 89-41 to go wet.
The number of Tennessee communities that allow sales of liquor by the drink (in bars and restaurants) has increased 56% since 2003. In the same period, 22 of Texas’ 254 counties and more than 235 of its municipalities have gone wet (or “moist,” a nebulous category in which beer and wine might be legal, but not liquor).
Even in Kansas — the state that produced the ax-wielding saloon-wrecker Carry Nation; that passed the first state prohibition law in 1881; and that did not repeal it until 1948 — 16 counties have gone wet since 2002.
One interesting side note is that economics is one of the most popular reasons, with communities wanting the tax revenue from alcohol sales. But that’s also the way that neo-prohibitionists have been going after alcohol, by trying to impose more and higher taxes. An interesting dichotomy, I’d say. Below is a nice chart of where the dry counties are and their number as compared to the total counties in each state.
