The Tobacco Deal - U.S. Tobacco Industry Case Study

Five key companies dominate the U.S. tobacco industry. These corporations mainly specialize in the manufacture and sale of cigarettes. At the forefront, controlling almost half of the U.S. market for cigarettes and owning the Marlboro brand, lies Philip Morris Companies, Inc. Only half of their revenues come from the sale of tobacco products; Philip Morris also includes and owns food and beverage businesses, notably Kraft and Miller Brewing. Next in line is RJR …

…In the original agreement last summer, the tobacco companies agreed to end most tobacco advertising that depicted human figures. New ads would be black and white "tombstone" ads that give just the name of the brand. The White House has cautioned that mandating such restrictions could result in court challenges. Instead, some Hill lawmakers have discussed capping annual payments the industry would make. They imagine the industry would settle for 25 to 30 percent of annual earnings.