ry prices Tough Calls would have been about $40 billion higher. Since AT&T accounted for about 38 percent of industry revenue, it would have had about $5 bil- lion more revenue per year. Instead of declining revenue, it would have shown growth. And history would have been very different. Treadmill of Expectations The lesson learned here, of course, is strictly academic: Don't compete with cheats. The more practical-and perhaps obvious-lesson is to be extremely cautious in setting expectations. AT&T, like many other companies in this era of booming stock markets, was on a treadmill of ever-increasing expectations that crested in its December 1999 analyst meeting at the Waldorf-Astoria. Again like many other companies in this era of "irrational exuberance," AT&T fed the unrealistic expecta- tions of a market with a tapeworm in its gut. We mistook the market's nurses-the media and financial analysts who tracked the product of its digestive system-for the patient itself. And that is how we lost control of market expectations: We attempted to feed an insatiable beast. It's a familiar story. Even now that the fever of hot new offerings and ever-rising stock prices has cooled, too many companies treat the media and financial analysts as stakeholders rather than as channels to the people whose welfare is really tied to the company's fortunes- its own employees, customers, and investors. The media, by defini- tion, need to be fed something new on an ever-shortening news cycle. And, as Louis Lowenstein, Simon H. Rifkind Professor Emeritus of Finance and Law at Columbia University, once wrote, sell-side (bro- kerage) analysts "may not always see the forest for the trees, but their collective thirst for information-the information that will drive new trades and commissions-is unquenchable." The real tragedy is that some companies build their business plans, their recruiting, and even their structure around their perception of how analysts will react. And some boards mistake analysts' percep- tions and biases for the reality 