Some Lies Refuse To Die: New York Daily News Perpetuates Steve Jobs Compensation Falsehood

by , 1:00 PM EDT, September 18th, 2003

Once a good bit of factual inaccuracy gets going, it's often hard to stop it. Such is the case with Graef Crystal's fuzzy math attack on Apple's compensation for Steve Jobs. Originally published by Bloomberg News, Mr. Crystal's column on out-of-control pay for CEOs took a nine-year total compensation package for Apple CEO Steve Jobs of US$158.6 million, and called it instead a one-year compensation package of US$219 million.

TMO published a column by this author debunking that piece, and explaining the actual math involved. For those keeping score at home, Steve Jobs's total compensation for the last six years, coupled with the next three years over which his stock grant will vest, is actually US$17 million per year. While some will still call that excessive, it's a far cry from the US$219 million in one year that Mr. Crystal claimed Steve Jobs was getting paid.

The New York Daily News has taken that one step higher by publishing a report that says that Apple Computer has actually paid Steve Jobs US$219 million per year for the last three years. That's a whopping total of US$657 million, though again, in reality Mr. Jobs has been compensated US$158.6 million for a nine year period (see The Spin below for an update on that number). The newspaper's source for this outrageous inaccuracy? The same Graef Crystal.

At least 15 firms paid their CEOs more than $19 million a year over the last three years, according to data from independent compensation consultant Graef (Bud) Crystal.

That includes Apple Computer, which paid CEO Steve Jobs $219 million per year for the last three years, including salary and options, according to Crystal.

You can read the full story at The New York Daily News.

The Mac Observer Spin:

As we have said before, if you want to argue about CEO pay, that's fine, but use real numbers. In actuality, the value of Mr. Jobs compensation has actually risen since we last tackled this subject in August. That's because Apple's stock has risen, meaning that Apple's CEO has created shareholder value while also raising the value of his own stock grant. At today's value, Mr. Jobs stock grant is worth US$114.7 million, combined with the US$84 million jet, for a total value of US$198.7 million. Over the nine year period for which it was offered, it comes out to a bit more than US$22 million per year. Note that even with the rise in value of the package since August, it still doesn't add up to the total figure portrayed by Mr. Crystal at that time.

Still, what gets our goat on this subject is the sensational nature of the attacks on Apple and its CEO compensation. The people putting together the reports and opinions that have criticized that compensation are smart enough and educated enough to know that they are inaccurately portraying those numbers, making the attacks little more than an opportunistic grab at the headlines.

Our view on this is not necessarily a popular view, but we think that with entertainment and sports celebrities pulling down the same kind of money, that some CEOs are earning their pay. Steve Jobs is included in that group, but if you are going to argue against that, use real numbers from which to argue.