You Have The Right To Pay...$25,000 That is

Google has to pay a $25,000 fine because a lack of cooperation in an investigation into the company's storage of personal data over wireless networks. There has been a lot of scrutiny facing Google and how it stores its' data. Many lawmakers have a negative view of Google and this lack of cooperation strengthens that this dislike. Since May 2007, Google collected content form wireless networks and other things such as passwords and history. According to executive director of Electronic Privacy, Marc Rotenberg notes that, "Google unlawfully intercepted and stored millions of wireless communications from Wi-Fi routers. "Google violated FCC orders by delaying its search for emails and not verifying the accuracy of its submissions. There have been also other data protection issues in countries like Canada France, and the Nethederlands. We all use Google but when it starts tracing everything we do and following our every online footstep it can be a very dangerous service.

The full article can be found at: http://www.bloomberg.com/news/2012-04-15/fcc-seeks-25-000-fine-from-google-in-wireless-data-privacy-case.html                                                                                                                                      

Dodgers Here, Get Your Dodgers Here

Do you have $2.15 billion to spend? If so you can buy the Los Angeles Dodgers after they won permission to sell the Major League Baseball team. Kevin Gross, a U.S. Bankruptcy Judge, approved the reorganization plan. Major League Baseball is worried about some parts of the sale such as who will own the parking lots and whether a mediator would be necessary in the future. The current owner put the Dodgers into bankruptcy which he claims was due to MLB Commissioner Bud Selig rejecting a new contract between them and Fox Sports. This has put them into a cash crisis although they are tied for fifth-most World Series championships. Whoever owns the dodgers wil have a lot of work to do to revitalize the franchise but there is potential to make a good amount of money.

The full article can be found at:http:/f/www.bloomberg.com/news/2012-04-14/dodgers-win-court-approval-to-sell-team-exit-bankruptcy.html

Angry Birds May Be a Little Happier In China

Rovio Entertainment Oy, creator of "Angry Birds", said it's in talk with Baidu Inc. and Sohu.com Inc., Chinese companies, in order to bring its' game to the world's biggest Web market. They are looking at bringing the game, which has recorded more than 100 million downloads in China,  in new methods. The game runs on Google's Android and Apple's iPhone and iPad devices. Rovio is based in Finland and notes that smart devices are growing rapidly in China. This translates into more game downloads. Angry Birds has crossed the threshold into merchandise such as stuffed toys and coffee mugs through its online store. They are also working on an IPO though they do not know the location yet. They raised $42 million from investors last year and with a country that has 513 million Internet users. Rovia stands to make a lot of money in China.

The full article can be read at: http://www.bloomberg.com/news/2012-04-12/angry-birds-creator-in-talks-with-baidu-sohu-in-china.html

Safeway On The Rise

It has been speculated that Safeway Inc., a large grocery chain, based in Pleasanton, California might be acquired because payouts for executives had been changed "in the event of a takeover." Stocks rose 2.5 percent and advanced 7.5 percent this week, the biggest increase since 2009. On April 9, the CFO Robert L. Edwards assumed the presidency of the more than 1,600 stores. Safeway is the second-largest U.S. grocery chain rose 6.3 percent and it has a market capitalization of about $5.7 billion. Safeway is not commenting over the speculation for takeover. They adopted a practice called "double-trigger vesting acceleration" that would require executives to stay at the company to get their money in case the company is bought. It is a very unique strategy and helps further the belief that the company will be bought by some other large group.

The full article can be found at: http://www.bloomberg.com/news/2012-04-13/safeway-rallies-most-since-2009-on-possible-takeover-spec.html

Pick Your Monopoly

Apple and five leading book publishers are trying to break up Amazon’s e-book monopoly.  Currently, most e-books are sold through Amazon.com, which utilizes a “wholesale” model in which they are sold to the retailer who then sets the retail price. They would like to move to an “agency model” where publishers set the price and retailers get a fixed commission. Amazon employs the “wholesale” model and this leads to cheaper prices than the “agency model.” The government is supporting lower prices and the Justice Department’s antitrust division has threatened to take Apple and these publishers to court.  Apple’s contract would prohibit publishers from entering into “wholesale” arrangements with any other major distributor and that no other distributor could sell books for less than Apple. The antitrust division claims that there was collusion between Apple and the publishing companies and an attempt at price-fixing.

            On the other hand, Amazon’s monopoly with e-books at $9.99 has been and is continuing to drive local bookstores and even Barnes & Noble out of business. Andy Gavil, antitrust expert at Howard University, says the only safe mechanism for price setting is open competition. Furthermore, Amazon sold e-books at a price that was lower than what they were actually paying the publishers for that book. Many industry competitors see this as predatory pricing in order to create that monopoly that in all reality they have today.  What makes this different than other types of monopolies and such is that this is taking place in the technology sector, which is naturally accustomed to winner-take-all competitions. The best examples being Google and Facebook that each holds a monopoly on the search engine and social media markets.

            This relates to our class because it deals with a near-monopoly and the forming of a potential oligopoly. Amazon is a near-monopoly because although other places sell e-books, Amazon undersells them all and controls that market. This underselling also works as a barrier to entry that stops other competitors from truly competing with them. An e-book that iTunes will sell for $12.99, Amazon will have it on their site, the same item, for $9.99. Apple and the publishing companies are trying to create a differentiated oligopoly. The antitrust division believes that all these groups colluded with Apple so that they could make more money by setting prices themselves. Collusion helps ensure that each firm involved will make the most profit by having all firms use the same pricing strategy. Apple will stand there to prevent any incentive to cheat since it is the retailer handling the transactions. This article shows how open competition would be the best system and avoid all these pricing wars and strategies but technology will always be a market where they can only be one company who stands on top.

The full article can be found at: http://www.washingtonpost.com/pick-your-monopoly-apple-or-amazon/2012/03/05/gIQA0kBB4R_story.html

Vacations Will Get Even More Expensive

The airline industry is enjoying the benefits of consolidation although gas prices continue to skyrocket. So far in 2012, there have been three fare hikes even though there were 11 increases so far between the years of 2010 and 2011. Crude oil has increased nearly 30% over the past six months. The increase in oil prices has been leading to less planes in the air and furthermore, more crowded seats. United has filled nearly 80.6% of its overall seats and all these costs are just being transferred to the customer. Some predict that airlines will try three to four more fare hikes before the summer travel season with sales only to help fill during the mid-peak times. Besides those that must fly due to business, I believe this summer will have sharp declines in flight revenue because the average four person family will have a hard time paying for such a flight. When the cheapest round-trip on average is $362 and this is in March, by the time summer comes around people could be finding the cheapest tickets being at least $400 per person. More families might resort to driving to closer destinations or holding off on vacations for a year or two to save money or wait for prices to decrease.

Read the full article at: http://www.businessweek.com/articles/2012-04-02/forget-gas-prices-air-fares-are-getting-more-painful

Burger King Trying to Keep Up with Competition

Burger joints are no longer the obvious front runners when it comes to the fast food business. McDonalds is still in first place but now Subway and Starbucks claim the 2nd and 3rd spot respectively in largest chains. People are now more focused on what they are eating and are looking for healthier alternatives whenever they can get them. Smaller chains like "Five Guys" have shown that people will also pay more for a burget that is made-to-order and also contains better ingredients. Burger King has failed to keep up with the changing times and is now looking to reinvent itself and improve in the future.

Burger King has gone through a very rigorous reevaluation and examination of its current offerings after being purchased by 3G Capital. The meetings involved everything from oils and eggs in mayonnaise to the intensity of vanilla used. Many of the offerings being rolled out seem to mirror McDonalds but it is what the consumer wants. Along with the food, the restaurants themselves are being renovated from their current aging appearance. Franchisees also are getting a 50% discount on the annual $50,000 franchise fee.

Advertising is also getting beefed up with commercials featuring popular celebrities. Burger King wants to stress how much the store has changed from its past. In a competitive market like this, where fast food, no longer simply means "burgers and fries." Companies need to find ways to innovate and re-establish themselves as something modern. Burger King has been around for a very long time and so has McDonalds but McDonalds always keeps adding and removing things from their menu to stay ahead of the times.

Read the full article at: http://www.google.com/hostednews/ap/article/ALeqM5in3sqZbXhPsLKovi_S3bVBkMOq6w?docId=0d1ce06d4aab4a4db711236bab016575

BPA Business Will Still Be In Business

A ban to remove bisphenol A, or BPA, from cans and other packaging was rejected by the FDA because not enough data was provided to support the ban. BPA has been in use since the 1960s and it extends the shelf life of canned foods and beverages. Whereas companies like Campbell Soup Co. have been working on phasing out the use of the chemical, companies like Coca-Cola Co. say that it is safe and do not plan on removing it. It is argued that BPA may affect the brain and prostate gland in fetuses and young children.

BPA is a million-dollar business and a ban would hurt profits at large can-makers and the biggest producer of the chemical, Saudi Basic Industries Corp. Some believe that the FDA is no longer protecting the public by allowing this chemical to remain while others such as the chairman of the North American Metal Packaging Alliance praise the decision.

Although no one wants to have chemicals in their cans, the fact that there is large amounts of money involved means that no will would dare touch their industry. The FDA should research the different  chemicals found in food but unless anything is immediately life-threatening they will more likely just let it continue to exist. For as much as the FDA exists for regulating, it is still a business and will support other business when it comes to profit-maximization.

Read the full article at: http://www.bloomberg.com/news/2012-03-30/u-s-denies-request-to-ban-chemical-in-food-and-drink-packaging.html

Call Your Friends and Pay for Dinner...With the Same Device?

New Zealand is working on a joint venture that would essentially turn cell phones into credit cards. Phones will become "virtual wallets" that can pay for purchases at supermarkets and train stations. Paymark Ltd. is New Zealand's leading credit-card processor and is joining forces with the three top cell-phone carriers (Vodafone New Zealand Ltd., 2degrees Ltd., and Telecom Corp of New Zealand Ltd.) for this creation. With this new collaboration, customers will be able "to make secure payments, collect loyalty points and use public transport..." This service uses near-field communication which means that customers simply need to hold an enabled phone near specific terminals at locations to make the purchase.

Phones can really do anything now and are being used constantly throughout the day. Our smartphones have become our computers, our cameras, and mostly everything that we used to carry around in our pockets or backpacks. This is a great initiative and furthermore, it's even better to see these different companies working together to build a better technology. It will be interesting to see however credit card companies reaction to this because it has the possibility to eliminate the need for a credit card in the future. Although it's simply starting with just supermarkets and trains, the possibilities for this have no end. Credit card companies will have to keep an eye out to make sure that this does not come and steal their entire market away from them.

Read the full article at: http://www.bloomberg.com/news/2012-04-01/new-zealand-mobile-phones-to-become-virtual-wallets-in-venture.html

Planters Peanut Butter......Finally

Finally, after 100 years, the most logical entry into a new market is coming with Planters going into the U.S. peanut butter market. The only problem is that with so much competition in this market Planters has a lot of work ahead of them. Planters is targeting adults with their peanut butter campaign and using a mascot, "Doug," voiced by Kevin Dillon, known for his character on the hit HBO show, Entourage. Kraft, which owns Planters, is trying to work its' way more into the grocery business where it has been lacking for years.

Kraft had been neglecting its Planters brand for some time, until the relaunched Mr. Peanut with the voice of Robert Downey Jr. The marketing team started thinking of new products and it's using peanut butter in different ways. Instead of typical peanut butter & jelly sandwiches, it is focusing more on more comprehensive recipes using peanut butter. Planters will probably succeed due to it's great brand recognition and the fact that people associate Planters with a quality nut product.

Read the full article here:  http://www.businessweek.com/articles/2012-03-08/krafts-planters-heads-for-the-peanut-butter-aisle#p2

Rodgers' Discount Double Check

What happens when a touchdown dance and an insurance company get together? You get the "Discount Double Check," an Aaron Rodgers creation that took on a life of its' own. Originally done by Rodgers as a touchdown dance during practice, State Farm partnered up with him and turned the move, with a new name, into a phenomenon. The "Discount Double Check" took a life of its' own with sports players and commentators using it as a part of their normal vernacular. This was an advertiser's dream. State Farm was able to successfully penetrate into mainstream media and become a part of the sports world.

The downside however is that people are not making the association with the discount double check and State Farm. People know the move and the phrase but the tie-in with the company is not really there. State Farm will continue to spread the phrase but it will work more in strengthening the relationship. It’s certainly better to have your product name out there divorced from the company than to not have it out there at all,” says Bob Dorfman, creative director at Baker Street Advertising. They have an enormously popular sports star and a great slogan so this phrase seems like it is here to stay.

Read the full article: http://www.businessweek.com/articles/2012-03-06/state-farm-steals-a-touchdown-dance-and-scores-free-advertising

Mormon Mall

Last week, a 700,000 square-foot mega mall funded by the Jesus Christ Church of Latter Day Saints opened in the heart of Salt Lake City. More than 90 retailers will be inside this mega-store and 1/3 of them are brand new to Salt Lake City. City Creek Center, the mall's name, has fountains that spew fire and water, a retractable sun room, along with other man-made fixtures. The store has a deal with the church and will be closed on Sundays and also will be sharing some profits with the church. Mormons have a tradition with this type of investment. Brigham Young, the Church’s second president, founded Zions Cooperative Mercantile Institution which is sometimes referred to as “America’s First Department Store."

This mall is sure to be a hit in Salt Lake City because it incorporates new stores and modernized shopping but still stays true to Mormon beliefs and tenants. Also, this mall shows that although we are slowly coming out of a recession some groups, like the Church of Latter Day Saints, still has money to develop and build. What will be interesting is if stores like Macy's and Tiffany & Co. will sell the same merchandise they do in other stores in the City Creek Center or will they adjust to fit a Mormon audience.

The full article can be found at: http://www.businessweek.com/articles/2012-03-16/what-slowdown-the-mormons-are-building-a-mega-mall

An Apple TV TV

It looks like Apple's biggest supplier is branching out into the TV business with a $1.6 billion dollar investment in the Japanese LCD TV company Sharp. Sharp is currently struggling after it said it's expecting to lsoe $3.48 billion this fiscal year. The Sharp plant though is the most efficient plant at making 60 in. TVs and could be the future leader in smart televisions. People are expecting to see a debut of an iTV by the end of the year.

Television may be a smart move for Apple because it works strongly on the interconnection between its different devices. Everyone also knows that Apple TV is reworking itself to come out bigger and better and having an Apple constructed television would be a nice compliment. Apple is trying to be a constant part of a consumer's day and television would just increase the amount of time that a person can use an Apple product.

The full article can be found at: http://www.businessweek.com/articles/2012-03-28/sharp-investment-makes-sense-if-apple-tv-is-coming

All Bags Fly for Free...Not Exactly

Southwest Airlines focuses its' advertising campaign and it's slogan attacking other airlines for their gratuitous use of fees. A big Southwest motto is that "Bags Fly Free," which is true unless you are flying on their wholly-owned subsidiary, AirTran Airways. Although it's been three years since the purchase, the fees still remain. AirTran still is an independent operation but Southwest is working on incorporating it and making it a part of the Southwest brand. This is a slow process but also bag fees are a strong source of revenue. The issue is that if Southwest Airlines prides itself on no fees but their subsidiary charges fees will this hurt the brand name.  The merit to Southwest Airlines motto may be tarnished a little bit but the divide between both companies helps distinguish one from the other. I believe that AirTran will have its best year once it's fully incorporated into Southwest.

Read the full article at: http://www.businessweek.com/articles/2012-03-28/at-southwest-not-all-bags-fly-free

Feedback Schmeedback

Just because a company asks for your opinon does not necessarily mean that they want to hear it. Many major companies use a "Great Man/Woman" approach with one person making all the major decisions. Some people like Larry Ellison of Oracle makes all the decisions from advertising to product development. Steve Jobs was notorious for this because it was not until later in life that he stared listening to others around him but still, the final decision was up to him. The firms have a type of CEO idolatry which although have had some successes may ultimately lead to their downfall. No matter how knowlegedable and visionary a CEO is, they still may make mistakes about trends in the market or what next move should be made. Business intelligence and knowledge management have made huge strides in the past years but many big companies would rather stick to what they are doing and not listen to those who actually consume and use their product.

A strong exception is Google that basically revolves its' whole money-producing function around what works with customers and what does not. Google makes its money through advertising and it uses feedback to understand what produces the best advertising. Facebook, on the other hand, uses advertising for revenue but is struggling against Google because it can not produce the same amount of revenue. This may be due to strategy or some factor but definitely, feedback and business intelligence plays a role. Customers are how an operation survives so listening to them and their needs is the only way to adapt, change, and thrive.

Read the full article at: http://www.businessweek.com/articles/2012-03-26/analyze-this-tech-companies-dont-use-their-own-products

German Amazon?...Well, Not Exactly

Amazon is having competition in southeast Asian markets but from itself? The Samwer brothers, who are known for copying American businesses and launching copycat versions have just released a copy on Amazon.com. Lazada.com, their new website, copies the layour and even color scheme of Amazon. They are targeting southeast Asian countries that have not been locked up by Amazon yet. So far the brothers have made over a $1 billion dollars by copying sites like Ebay, Pinterest, etc. Their effectiveness comes out of a well-funded "clone factory." This however brings up the question that if websites can be successfully copied and can become popular in smaller markets, what's to prevent their reach into larger albeit still international markets?

Copyright laws will protect these copycats from competing with their original American versions but overseas, especially in countries with more relaxed copyright laws, these sites may thrive. It's a delicate balance the Samwer brothers must manage but it does show that copycat websites can be successful and that brand name does not mean the same thing all over the world.

The full article can be found at: http://www.businessweek.com/articles/2012-03-22/german-copycats-clone-amazon-dot-com

Order Up! Japanese Is On The Menu

Investors have been dumping millions into Japanese farms and fish ponds as the world's appetite for Japanese products increases. Food investors have already invested at least $281 million. "Food is the one area that has a big investment potential,” says Mori, 44, president of Dogan Investments in Fukuoka City. Twenty-five regional banks have increased their lending to farmers who want to export their products abroad. Banks are giving low lending rates because they believe that the taste for Japanese delicacies will only expand and they will make back what they lend and more from these farms.

Wagyu beef and black swine are also two other major livestock that have been growing exponentially and customers have been scouting out these markets. Owners of these farms have essentially changed from farmers to securities salesmen because of the growth in these industries. This can serve as a great boost for the Japanese economy who has had lending decrease over the past 2 years. The world's tastes are expanding and Japan is enjoying the boom it gets from these new globalized consumers.

The full article can be found at: http://www.businessweek.com/articles/2012-03-15/funds-hope-to-cash-in-on-japanese-cuisine

Will Apple Need Carriers Anymore?

It appears that Apple is currently looking for telphone software engineers to work on iOS. Many people are very excited about this because Apple is looking to add voice-over-IP (VoIP) capabilities to its iPhone and iPad operating system. This is doubly exciting because it could potentially mean that it may drop its' carriers and launch its own voice service. On the other hand, it could mean that they want to work even closer with its partners because VoIP is the next generation in voice services. Apple neds experts to develop SIP-based clients to communicate with carriers' IMS cores.

Apple will most likely not go into the the VoIP business for many of the same reasons that Google is not getting into the business. This technology will probably go into a cross-device VoIP set-up that allows customers to trade phone calls among iPhones, iPads, and Macs. This communication could range from phone calls to videoconferencing to instant message. Carriers will never be able to limit Apple's ingenuity and this initiative, if it is successful, may make Apple products even more popular then they are now.

The full article can be found at: http://www.businessweek.com/articles/2012-03-23/is-apple-planning-its-own-mobile-voice-service

Extra! Extra! Want to buy a Daily Variety?

The Web once again shows it's strength and how if you can't update then you can't stay in the game. Daily Variety, Hollywood's 107 year old industry trade publication has been put up for sale. This comes after the trade newspaper has been losing out to its' competitors Deadline, the Wrap, and its' traditional competitor, the Hollywood Reporter. The Reporter had a relaunch in 2012 where it put daily news on its website and released a weekly magazine.

Daily Variety is still known around the world and this valuable asset makes it a "trophy brand," according to Ken Sonenclar, managing director at DeSilva & Phillips investment banking. The sale praice will probably be around $50 million but to survive the newspaper will not only have to get better managment but also revamp itself. Variety was one of the first newspapers to block its Web content to non-paying subscribers. Its' competitors, however, post much of the same news for free online. Daily Variety needs to be taken into the digital world. People can get the same news and the same information for free in an instant. They need to figure out what makes them different and how they can market that to customers.

The full article can be found at: http://www.latimes.com/business/ct-variety-sale-20120324,0,7980325.story

"The Hunger Games" - More of a Dessert to Finish a Great Quarter in Hollywood

Hollywood executives are breathing a little easier after the phenomenal first quarter it has had after coming out of a disappointing 2011. Last year had the lowest levels of movie attendance in 16 years when it dropped 4%. The newly-released "The Hunger Games" just had the 3rd biggest opening ever with $155 million dollars although it cost Lionsgate studios only a little more than $80 million to make the film. This has been the biggest first-quarter increase in years and this is changing the film industry's mindset that the first quarter and winter, in general, is only for the "least attractive pictures."

This winter has produced a number of hits with filmgoers such as "The Lorax," "Chronicle," "The Woman in Black," and the "The Devil Inside" which opened to a strong $33.7 million on the year's first weekend. Veteran movie producer Sean Daniel notes that "Word of mouth goes viral today," and that Internet trailers help build excitement and it keeps the audience in a "moviegoing frame of mind." Recent movies also have been so varied that it is attracting a wider scope of individuals. Furthermore, social media and targeting specific cable channels has made advertising more impactful and cost-effective.

This trend seems like it will continue because the two biggest films of the year, "The Avengers' and "the Dark Knight Rises" have yet to come out and those will definitely be breaking some records. All in all, 2012 does not look like to be the end of the world, at least not for the film industry that is, they will surely be resting easier once the year's sales figures come in in December.

The full article can be found at: http://www.latimes.com/entertainment/news/movies/la-fi-ct-projector-20120323,0,1353397.story