The Great Texas Water War

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"It's ironic that two Texas people compete," he mused. "It's foolish. I think they would be a lot bigger a lot faster if they had a focus that was bigger."

To Davis, that bigger focus means such soft-drink giants as The Coca-Cola Co. and PepsiCo., at whose expense he expects the bottled-water market to grow to a $4-billion-a-year industry by the year 2000. And to meet the challenge, Davis has increased Perrier's already sizable budget for promotion and advertising, and introduced three new flavors (orange, lemon, and lime). Perrier had also become a regional bottler in its own right, buying up such local brands as Poland Springs, in New England; Calistoga Mineral Water, in California; and Oasis Bottled Water, in Texas. The regionals would allow Perrier to expand its share of the water market by recapturing consumers who preferred to buy American. It would also allow the company to control an increasing number of the "fronts" on the all-important supermarket shelves.

It is just such pressure from Perrier, in fact, that finally forced Rick Scoville and Ron Bownds to call a halt to their feud. The terms of the agreement, reached last November, are confidential, and both parties are pledged not to talk about each other, or their dispute.

In a sense, they had no choice. By most estimates, the next two to five years will see a major consolidation in the water business, from which only a handful of players will survive. After that, according to Hank Forrest, director of sales and marketing for Utopia, the industry will be left to national companies with enough money to support national television advertising. Perrier will be one, of course. Anheuser-Busch Beverage Group Inc., which just bought New York-based Saratoga Springs Co.'s Sparkling Mineral Waters, may well be another. And the soft-drink companies might jump in too -- certainly it would be less risky than switching formulas for a sliver of the cutthroat cola market.

Ron Bownds hopes Utopia will be among the national brands that survive. Since he filed his suit last summer, sales have been growing by a third or more each month, and distribution has already spread to Arkansas, Oklahoma, Louisiana, and California. Within a few months, Utopia will introduce orange, lemon, lime, and cherry flavors, and offer plastic containers for vending machines and airlines. A new half-million-dollar plant is under construction to bottle the expanded line. And to distribute it, Bownds looks to shift from food brokers, who bring everything from soup to nuts to stores once a week, to beer distributors, who make more frequent deliveries and specialize only in beverages. The Anheuser-Busch distributor in Yonkers, N.Y., has already taken on the Utopia line.

In fact, if things go according to plan, Ron Bownds expects to be shipping Utopia overseas before too long, perhaps starting with Perrier's home turf in France. "Wouldn't that be something," he marvels in his affecting Texas drawl, "to find Utopia on the Champs Elysees." You can tell this man is on a roll. Hardly a day goes by that Bownds doesn't get an offer to sell the company, or a few feelers or inquiries from investors. One promoter has even written hoping to turn Utopia into an upscale health spa.

Bownds says he doesn't worry much about Scoville anymore, although Utopia is still only about one-third the size of Artesia. He says he never wanted a feud in the first place, but once it started, he figured there was no way he could lose. Scoville had a good story to tell with his Artesia versus Perrier, but Bownds had a more powerful myth working in his favor. In Texas, there could be nothing so appealing as a country boy fighting to keep the family spread.

Down in San Antonio, Rick Scoville now understands the logic of all that. He sees more clearly his mistakes. It was bad enough that he had his white hat knocked off in public, that he allowed himself to get kicked around in the press. But he also knows that it could have been worse -- much worse -- if Bownds's suit had ever gone to trial.

Not that Scoville has any intention of letting Utopia walk away with the Texas water business. Like his competitor, he is charting a new course. After Bownds began new plant construction in Utopia, Scoville announced that he, too, would be building a new plant and introducing new flavors. And a new advertising campaign is in the works -- something along the lines of "All waters are not created equal." The way Scoville figures it, his Artesia was the first local water, and that should count for something. And he's still the biggest, at least in Texas.

There is the impression, however, that Rick Scoville no longer has much zest for the battle. "It's getting to be a very dirty business, the water business," he complains. Scoville talks wistfully of selling out, as he had always planned. He's written to both Philip Morris Inc. and General Foods Corp., but so far there has been no interest.

For now, the streets of San Antonio are claim. But it would not take much to rekindle the feud between Rick Scoville and Ron Bownds. "If the agreement is broken, we'll go back to open warfare," promises Scoville, somewhat ominously. Bownds's reaction is customarily sly. "What else can you expect from someone from Connecticut?" he asks, smiling. In Texas, that's a question that demands a response.

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