Silicon Valley's image troubles run a lot deeper than just PR

Like most others in Silicon Valley, I've watched Hewlett-Packard's slow-motion train wreck - its unethical and probably illegal anti-leak spying program - with awe. HP has compounded its behavior with a bumbling, limited hang-out PR strategy.

Like most others in Silicon Valley, I've watched Hewlett-Packard's slow-motion train wreck - its unethical and probably illegal anti-leak spying program - with awe. HP has compounded its behavior with a bumbling, limited hang-out PR strategy.

Company founders Bill Hewlett and Dave Packard, whose "HP Way" was a testament to doing things honorably, are surely spinning in their graves. Meanwhile, the current management is trying hard to spin its misbehavior into something that will let the company go back to business as usual. Good luck.

HP's woes have shifted focus away from another corporate ethical debacle, namely the stock options scandal. That, you'll recall, involves corporate chieftains and their obedient (or incompetent) directors, who've abused shareholders to further enrich the executives.

As a Silicon Valley resident, I'm sorry to say these affairs have the Valley and its longstanding arrogance in common. The 1990s stock bubble and its predations were bad enough. The latest news has made things worse, even if apologists can't accept reality.

After The Washington Post called the Valley's image "tarnished," San Jose congressman Michael Honda begged to differ. "This could not be farther from reality," he wrote in a letter to the editor. He correctly noted that Silicon Valley remains an immensely innovative, dynamic place. He was entirely right, moreover, to add that most executives in the region are honest.

But when the Valley's most venerable big company gets caught running a sleazy spying operation, and when roughly half of the companies known to be under investigation for stock options shenanigans are in the tech business, you can't just ignore reality. Or maybe you can, if you're a member of Congress.

I'm writing this several days before CEO Mark Hurd, Silicon Valley alpha lawyer Larry Sonsini, former board chair Pattie Dunn, and others are scheduled to appear at a congressional hearing on the matter. I'm betting they have more bad news ahead of them before the company returns to an even keel.

I'm almost feeling sorry for HP's PR folks at the moment. The daily leak-a-thon - almost surely coming from Congress, to which HP turned over bales of documents - must surely be demoralizing.

Sonsini's role in the Valley's dual debacles may be the most intriguing. As outside counsel for HP, he offered advice - not to worry, we're doing nothing illegal, he effectively told the board as its spying operation neared public disclosure - that met a low standard indeed: What's acceptable is what you can get away with, not what's right.

Sonsini's firm has also represented many of the tech companies under investigation in the options matter. No big surprise, given that the firm has been the Valley's most influential and powerful for years, but it does raise more questions. Handling PR for Sonsini and his colleagues right now must be nightmarish, too.

No doubt, the Valley's image will recover eventually. But making that happen will require some honest introspection in executive suites and boardrooms, not just clever PR. How likely is that?

Dan Gillmor is the author of We the Media: Grassroots Journalism By the People, For the People. His blog is at bayosphere.com/blog/dangillmor. He is also director of the Center for Citizen Media (www.citmedia.com/blog).

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