How Long Before Big Tobacco Takes Over Pot?

I would love to hear from someone who actually works at a place like Phillip Morris about this. I assume they're already planning for it and will go live the second it is legalized at the Federal level.

So what you're saying is I should long Altria Group ASAP ??

I remember hearing as long ago as the mid-80's that Big Tobacco already had their trademarks in place for when pot was eventually legalized. They had their pack design done, all their logos, brand names, etc... I'm guessing they've been waiting for this for a long, long time.

The only play for the small to medium business owner when this happens (and you're absolutely correct in saying that it will) is to learn the individual state's distribution (and eventually sales) requirements/laws and work the logistics/distribution/security-of-product businesses. In most states that have legalized medicinal marijuana, the major hurdle in respective state legislatures has been the control and distribution of the product. Once the Federal government legalizes marijuana (realistic timeframe is arguably 48 to 60 months), the states will be slow to decipher/translate and implement Federal mandates/regulations, therefore whatever current laws are on each state's books will remain unchanged for a considerable amount of time... and by "a considerable amount of time" I mean "way too damn long... but long enough for an intelligent individual with a solid business plan and access to capital to make enough money to live 'comfortably' until they kick the bucket (and possibly 'chill' with The DogFather, AKA Snoop Dog, AKA Snoop Lion)."

Here's the one drawback to legalizing dope: we won't see hilarious videos of dipshits trying to rip off their dealers anymore:

//www.youtube.com/embed/GNpffvGQk2M

Hat tip: BroBible.

I wasn't aware that weed was so close to being legalized. I know that CO and WA made it legal entirely but I assumed that those were outliers. Even if it becomes legalized at the federal level, though, I'm positive that our friends running NYC will make it illegal here, at least in public places.

I can't wait to smoke a doobie without scheduling a drug test 30 days away.

Longing big tobacco companies, rate?

But if the major tobacco places start marketing it, will it have all the additives like cigarettes do or will it just be normal weed?

I'm sure they'll throw some nicotine in it or something to make you keep coming back for more.

I am not so sure. Marijuana is quite different than tobacco, you can easily grow the former at home as opposed to the latter that needs to be grown in large fields. There will be room for both in the new industry. Many of the land owners in the emerald triangle are fiercely independent and are very unlikely to sell to large industry. The problem for big pharma is even bleaker. You can't get exclusive rights on a plant. You can get a patent for a specific modified strain, however you have really no control over it once you release it to the market. The plant is too easy to clone. Consumers like the huge variety that is available in the cannabis market. I find it difficult to see the big players being able to keep up with the ever increasing number of genetic strains. To me the national legalization will only benefit the corporations if congress puts all sorts of regulations and fees to get into growing your own.

I don't toke so I'm an observer. This is hilarious. Eddie, I know you're going to miss some funny clips of dealers getting beat but think of it this way: there's going to be lots of rampant stupidity out in public display!

I think it's more likely that big pharma/tobacco will learn the same lesson gangs did back in the 70's: weed isn't a highly profitable drug. There's money to be made for sure, but it's not as physically addicting and anyone can grow it. Plus, pothead culture is typically averse to big business. I'm guessing that there's a huge "illegal risk" premium priced into current weed prices, and that the prices will be forced down and the market will crash before resetting itself. Who the hell is going to pay $20 for a nicklebag when they and every other pothead is growing it in their back yard? I think it's safe to assume that growing high quality weed is on the same level of accessible as brewing craft beer. Weed may have its "Sam Adams" or "Magic Hat", but I can't imagine that people are going to pay a huge premium, if they pay at all. The analgous "old standby" of Budweiser doesn't exist in the weed market, at least not commercially: the default is growing your own.

There are ways that they theoretically CAN make a buck: 1. Novelty. Find a new strain of weed that everyone just has to have, or pre make a labor intensive means of smoking it (see: pre rolled marijuana cigarettes) and patent/coptwrite it. 2. Try and bribe Congress to make it a "safety" issue and regulate the hell out of it. Or look at the laws governing moonshine: create a licensing requirement to block entry to the market. As much as business bitches about regulation, even finance, we all know that's bullshit. Business wants rules that make it easier for them to make money and harder for average person to compete. Smart people don't believes ideology, they just call upon it when it's convenient for them. Big business has been hijacking (or trying to hijack) the legal system since before there was a legal system....why would this market be any other exception? 3. Introduce another dimension of experience. They could learn a thing or two from the restaurant and beverage industry. Why do we pay $15 for a Belvedere martini instead of getting the $6 house vodka martini? Why do people pay $3 for a bottle of water they could just pour from the tap into a Britta filter and then into a reusable bottle? Why do they pay $8 per beer at a bar when they could pay $8 for a six pack of the same beer at a liquer store? Why do people drop $5 on a shoe shine that they can do themselves almost for free? There are social, convenience, vanity, particular tastes, marketing, and a variety of other factors at play. Big tobacco could focus on that market.

Still, the product or associated service that big tobacco would have to be far superior to what's currently available. People have been more than content growing their own and if there's anyone who's going to be paranoid about Monsanto's GMO weed, it's going to be potheads. I think corporate America will be disappointed, as well as the government that thinks its now going to cash in on taxing the habit. Consolidating the weed market is going to be like trying to consolidate the shoe shine market: you can make a few bucks and maybe make it scaleable, but this isn't the oil industry where you need $100BB to develop a field, and you're not going to see the same level of dominance, I don't see how it's possible.

On the plus side, our prison population will probably fall 50%, saving the taxpayer a bundle.

I'm also very curious about this as well. Canada privatized the medicinal marijuana industry this past December, and I have a few friends postponing their law careers to pursue a venture as producers - should be interesting to see how it all plays out.

I am a fan of the cannabis coffee shop concept employed in Amsterdam. Legal to purchase & consume the product on the premises...

Maybe it will be more like the beer market. Big tobacco will offer the "most popular" strains. Then you have little growers with "craft" strains. And then coffee shops offering their own strains like brew pubs. Then individuals growing for personal enjoyment.

Hopefully legalization happens soon. I have never smoked the stuff in my life, but fully support the end of prohibition of marijuana. I have a good friend from high school whose first job out of law school was working in the County DA's office of a major American city (think Chicago, Philly, Houston). You can probably believe the stories he tells of all the wasted time his office spent prosecuting petty marijuana crimes (i.e. some college kid gets arrested with a couple of joints). As taxpayers, we should all be concerned about the wastefullness going on in the justice system on things like this.

I support legalization, but lets not pretend there won't be consequences. I'm going to use it as an excuse to bitch slap hippies in my neighborhood for walking down the street with a joint.

I really don't think it will "move the needle" on usage all that much in the long term, but my neighborhood is going to be a Phish concert for several weeks after its legalized.

I am sure big tobacco will try to get into this market. It may be too late by then. Mom and Pop operations will aggregate to regional players. Big tobacco, while not far behind, will either acquire them or will become regional players in their home states and the Southeast. It will only take one instance of two states who share a border and legalize for the interstate commerce clause will come into effect. Obviously, this will open the possibility of a few interesting court cases that may go to the supreme court. Lets say that big tobacco would like to enter the market. Their best odds are at products that they already make in states that they already have factories. Should NC legalize, I would expect a working shift at the factory to produce weed cigarettes. From that, if profitable, they would expand to nearby states. How exactly? By using the great american system of lobbyist and advertising. It might be a great time to become a state senator.

tl;dr Big tobacco will make moves when legalization becomes profitable for them. Should their home states legalize, expect a big push into this market. If growth and profits remain stable, expect to see neighboring states legalize via their lobbying efforts. Two states sharing a border and the legal cases resulting from them and Big tobacco may be the a driving force in country-wide repeal of marijuana prohibition.

Long PM and RAI, short CXW. I've already owned RAI for years. I think this will adversely affect the private prison population. Should be a good thing to spend less money prosecuting and jailing people for it while on the other side increasing tax revenue.

Bernanke has only owned Altria stock for years....maybe he was waiting for something?

I wonder if you'll see laws prohibiting private growing in order to keep the tax revenue. Colorado rapes people with prices. You'll have pot gets going from a small fine to tax evasion lol.