(This column appeared originally in the 2/4 issue of Dan’s Papers)
Don’t Worry About Winery Consolidation
HP and Compaq have merged, AT&T recently acquired Cingular Wireless
and Verizon is buying WorldCom. Mergers and acquisitions are a part of
every day life in the business world. And, no matter how romantic an
image it might have, wine is a business. Big business.
So, it should come as no shock that the big fish in the wine pond are
gulping up smaller fish all the time, including many producers of the
wines you see at your local wine shop every day.
Fairly recently, Constellation Brands, already owners of the ubiquitous
Franciscan Estates, Ravenswood, Simi and Estancia brands, acquired
Robert Mondavi. Similarly, Diageo Chateau & Estates Wines, which is
responsible for Beaulieu and Sterling wines, gobbled up Chalone Wine
But what does this all mean for you, the wine lover? That really depends.
As fewer, larger corporate wine producers start to make more of the
wines we see every day, some worry about the
“watering down” of these once-proud brands. They worry that quality is
going to suffer as the “art” of winemaking is lost and replaced by
dollar-driven efficiency and techniques.
Should we worry?
Heck no. I think this consolidation is a fact of life, and it only has
positives in the wine world. Here’s why:
For the average wine drinker – someone who drinks wine regularly but
doesn’t want think too much about what goes in his or her glass –
consolidation is actually a good thing. Because of the vast quantities
of wine and brands involved, there is increased competitive pressure on
large producers. Increased competition means better prices and better
values for the consumer. Sounds like a good thing to me.
How will consolidation affect the people who do want to think about the
wine they drink, the real hard-core oenophiles who drink fine wine? I
don’t think we’re going to be affected much at all. Sure, Constellation
runs Mondavi, Franciscan Estates, Ravenswood, Simi and Estancia – all
solid, sometimes good producers – but these aren’t the wines wine geeks
drink anyway. These were, for the most part, large producers even
pre-Constellation, not the artisans crafting the most interesting wines
Serious wine drinkers probably aren’t cellaring cases of Ravenswood’s
12-dollar Zinfandel, are they?
Wine will always be a diverse industry. For every huge
conglomerate, there are hundreds of small chateaux in Bordeaux. On Long
Island, we’re lucky enough to be surrounded by several producers that
are committed to crafting fine, delicious wines. Sure, some are better
than others, but that’s true anywhere. The best Long Island pours are
interesting and take full advantage of our unique microclimate.
And, as our region matures and grows into an even more important
winemaking area, we’ll reap the benefits, regardless of who buys what
winery in California.
So, relax doomsayers. Consolidation is a good thing at best and a
non-issue at worst. Have a glass of wine, whatever you enjoy, and think
about more important, perhaps truly threatening, things.
Lenn Thomson is a contributing wine writer for Dan’s North Fork. Email him at email@example.com