Big Tobacco and Vaping: It’s Complicated.

With a mountain of money behind them, it seems logical that Big Tobacco would capitalize on the surging vaping market. Some have alleged the vaping industry is completely backed by the largest tobacco companies, that Big Tobacco is a puppeteer turning smokers and vapers against each other, profiting from both opposing views. Billions of dollars and international clout poise Big Tobacco for control and profit in this industry. We have investigated the relationship between Big Tobacco and vaping, with some alarming findings.

TROUBLE IN PARADISE:

iStock_000020179169_Medium

At one time, the tobacco industry had untouchable power. Since America’s birth, tobacco has been a cash-crop. The bizarre mix of relaxing, stimulating, pain-relieving, and addicting properties kept Americans (and soon the world) coming back for more tobacco. A steady surge through the 19th century shot the industry to the apex of the American economy, reaching a fever-pitch at the end of World War II.

In 1951, epidemiologists Austin Bradford Hill and Richard Doll went on the attack. With about 40,000 British doctors, Doll and Hill linked tobacco smoke and serious illness. In the decades to come, smoking was bludgeoned with advertising bans, plain packaging, and diminishing demand.

Countless class action lawsuits threatened the future of smoking. Furious, grieving, and drowning in medical bills, citizens became increasingly litigious in the 1990’s. A product that kills a wide margin of its users is bound for trouble; Stella Liebeck’s “hot coffee” lawsuit had set a powerful precedent for consumer’s rights.

Tobacco was forced to adapt. Desperate to secure a future, the biggest tobacco companies reached out to the government. State Governments agreed to the Master Settlement Agreement, which would guarantee states would get a cut of Big Tobacco’s profits in exchange for tossing out the lawsuits. Many State Governments sold their shares to Wall Street for cash up front (based on tobacco sale projections through 2025), instead of waiting for the yearly payments. The governments had their money, Big Tobacco dodged a legal holocaust, and both parties were pleased. Temporarily.

Cigarette sales plummeted in the new millennium. The decline was sharper than even pessimistic analysts could have predicted. Dwindling revenue meant less money for the states, meaning the governments who had cashed out were now on the hook to fill the gap.

Just when it seemed like things couldn’t get worse for Big Tobacco, vaping hit the scene. Millions of smokers made the switch. This exacerbated the pressure on state governments. Vaping, the wild-card new variable, was demonized by state-funded groups. Organizations such as the California Department of Public Health have attempted to hamper the growth of vaping through aggressive, unreasonable legislation and propaganda/FUD campaigns.

 

BIG TOBACCO EXPANDS ITS HORIZONS:

Electronic Cigarette Traffic Light Concept

Bonnie Herzog of Wells Fargo saw the surge of vaping sales coming. “It’s game-changing…I’m of the view that in the next decade consumption of these products will surpass consumption of tobacco cigs.” University of Ottawa law professor David Sweanor likens cigarettes to another antiquated product: The Kodak Scenario. Kodak film was once a powerhouse in the industry. Then along came digital photography. Kodak failed to adapt, and filed for bankruptcy in 2012. In business, you don’t want to “do a Kodak.”

With these intense changes to the world of nicotine consumption, what’s a behemoth tobacco company to do?

As covered before, Big Tobacco is no stranger to scrutiny. Executives and researchers in the tobacco industry have known how unhealthy cigarettes are, long before the research went public. Customer loyalty is hard to sustain when your customers are literally killed by your products.

Not surprisingly, in light of the mind-blowing success of vaping, Big Tobacco began buying out independent vapor companies. Lorillard purchased Blu for $135 million in April of 2012. British American Tobacco bought CN Creative. Imperial Tobacco made a deal with Hon Like, the Chinese inventor of modern e-cigarettes. Japan Tobacco bought Zandera, who manufactures E-Lites.

What does this mean for the future of vaping?

THE BIG SQUEEZE:

iStock_000010198153_Medium

If the restrictive legislation such as the FDA’s proposed Deeming Regulations were to pass, only the very wealthy companies would survive. Every application to meet the requirements of new legislation would take upwards of 5,000 hours per application, per product combination. Not only would this process be tedious and limiting to the industry, but so expensive that it would snuff out the majority of independent and developing companies.

At this point, the stage would be set for Big Tobacco to establish a monopoly. The “Deeming Regulation” would hand the vaping industry to Big Tobacco, who has shown us again and again that they have no regard for public health. In addition, the “cigalike” products distributed by Big Tobacco are less effective in getting smokers to switch to vaping, when compared to open-system and higher power vaping products. In summation, the legislation proposed would kill independent companies, make wealthy tobacco companies richer, and more people would die from smoking.

Something to think about:

What do you think would happen if Big Tobacco had a monopoly on vaping?

 

Tim is Mt Baker Vapor's resident creative weirdo. He writes, composes music, draws, designs, produces podcasts, investigates, and blows the trumpet for the Common Man.

23 thoughts on “Big Tobacco and Vaping: It’s Complicated.

  1. It’s seems like they would be playing a bigger role in the vape market if they were trying to squeeze out small vapor companies. So far, products like the lack luster cigalikes as in Vuse (RJ Reynolds) and Mark Ten (PM) have failed. Maybe they are just backing these proposed FDA rules on vaping in hopes we will go back to those old analog sticks, once those rules suck the creativity out of the vaping experience.

    1. I hope that all the vape companies out there can survive and resist the pressure to fold under big tobacco. I won’t be surprised when they start trying to buy up some of the smaller vape companies out there. We need to stay strong and resist their temptations of money. It’s not about the money, it never has been. We’re here to get people off of cigarettes. End of story.

  2. I think the only reason none of the tobacco companies have attempted to make open system, more powerful products is that if something went wrong, they’re really opening themselves up to lawsuits. With the current cigalikes, everything is contained, and there’s not nearly as much room for anything to go wrong.

  3. So far, products like the lack luster cigalikes as in Vuse (RJ Reynolds) and Mark Ten (PM) have failed. Maybe they are just backing these proposed FDA rules on vaping in hopes we will go back to those old analog sticks. It’s seems like they would be playing a bigger role in the vape market if they were trying to squeeze out small vapor companies.

  4. It’s a shame that the entire concept of regulation has been so corrupted that we can’t even pretend there won’t be special interests at play, because it’s not like the realistic alternative is a magical fantasy land where vaping continues as it is, i.e. vibrant and experimental. One way or another the big corporate players will find a way to dominate the market, the only question is whether they’ll do it via regulation or via buyouts and market monopoly.

    The best option we have is working to advocate for effective regulation that minimizes the power of Big Tobacco and balances safety needs with innovative potential. That’s the only conceivable avenue that doesn’t lead to the death of vaping as we know it.

  5. Smart people switch to vaping from cigarettes, Big Tobacco buys out politicians and activists against us. Society as a whole is not very smart, if you understand you know I’m not being rude. If you are offended, I am sorry you are not in the group. Vaping is a choice, it is not a trend…

  6. I’ve been vaping nearly ten years. When my first order from Hong Kong came, I bit the bullet and refused to have a tobacco cigarette for ten days. I’ve never looked back; except when ordering became a problem and then I had to use Paypal.
    Equipment was not as friendly or long lasting back then; but wrapping and taping the thin electric cord round the end of old styled eCigs plugged into my computer or pocket battery extended the life of equipment from about two weeks? to six or more months. Atties, of course, had to be purchased regularly. Still, it cost far less than 10% to vape than to purchase cigarettes*. Now with such excellent, long lasting equipment, there are only advantages to this better sport. But I can’t see how the Tobacco companies are going to take over the e-cig industry. There just isn’t enough money in it for them without corrupt government interference. In Canada we can hold our politicians feet to the fire. They are not going to pull any Yanky shenanigans against the people.
    Again, ten years on, equipment now lasts a long time and works far, far better. And the experience, health, safety and convenience, once break-in has been reached, is far better. No smelly house or clothes, no burnt shirts, stained teeth, filthy lungs and bad breath or other problems. I now get my equipment and e-liquid from a local independent Canadian seller as I want to keep the locals in business. It costs me less than $10 a week purchasing the highest-kick liquid; that kind of money would never satisfy bone-ugly, Big Tobacco’s hunger. Some friends put their own e-liquid together and save even more.
    The only ‘buy’ the tobacco industry would ever get out me is Good-bye, good riddance’ and go bankrupt! Corporate tobacco companies are patently contemptible. And bonus, tobacco farmers can now make far more loot growing industrial hemp. Speaking of hemp, I haven’t even gone into practical uses of e-Cigs for certain spiritual oils.?
    * There are health benefits to nicotine! There are no benefits, other than nicotine, in industrial tobacco. Search it out: seek and ye shall find.
    I’m an old hippie who never surrendered. Millennial’s are taking up the torch. Rock on buds!
    Namaste and care,
    mhikl

    1. Hi Mhikl,

      Great post! Like anything else, once the government is involved everything becomes complicated. With everyone for sale in an election year nothing is surprising. It’s customers like you that refuse to fall in line that keep the fight alive. Keep up the good fight!

  7. When we obtain a new Prez this January, Big Brother will try to shame us vapers with how we are hurting the livelihoods of all those poor folks who are small tobacco growers. Like anything else, they will have to adapt to their economic situations in order to provide for their families. I quit 50 yrs of smoking with my switching to vaping! I adapted and will be living longer because of the change. And that’s all I have to say about that!

    1. Hear, hear! The bottom-line about vaping is that it is a change. Change is threatening. To the status quo, to the cashflow, to the very machinery of politics. Those who have grown accustomed to being in control do not relinquish control easily, and they will kick and scream as long as smokers are switching to vaping.

      Thank you for your insights! The plot thickens…

  8. My Wife and I enjoy all your products from your Company. I see a big future in it and would if I could, buy some Company Shares from you if I could. I like to deal direct with out any middle man. We both stopped smoking on Nov. 4, 2016.. Thanks to you, we are both in our 50’s and feeling much better now. Think about it please and get back to me please. I’M looking forward to hearing from someone, Thank you and Happy New Year…

    1. We are not publicly traded so no Company Shares to purchased! If you want to avoid middle men, just purchase from us directly online! Right now all 15ml bottles are marked down to $1.88 until supplies last!

  9. Well, its slightly shameful that some of the tobacco companies are spending handsome amount of money on advertising false propagandas against the vaping. If a user vape or smoke, its his choice. He shouldn’t be forced to do so. No matter what, deep inside they tobacco industry also believe that vaping is much safer than tobacco traditional smoking. And now when people are switching to vaping, they want to get their hands dirty in such negative advertisement of vaping. Still I would say that these are two big industries and they should respect each other without throwing shit at eachother. PEACE!

    1. Thank you very much for your feedback and we definitely agree with you! “If you want to make peace with your enemy, you have to work with your enemy. Then he becomes your partner” -Nelson Mandela

Leave a Reply

Your email address will not be published. Required fields are marked *