Sony Unveils Its Answer to Apple’s iTunes
According to the article posted on businessweekly.com, the company better known as Sony is trying to copy a page from Apple. The article stated that Sony plans to start up an online website that will allow Sony to sell music, movies, books, and downloadable applications that are intended for mobile phones. Sony’s top managers don’t know what the website will look like, but that the strategy is to make it very similar to the Apple’s iTunes online store. This is Sony’s biggest attempt to link its products to its own library so that customers can be able to access all of Sony’s digital content. The person that is in charge of the new software strategy for Sony is the CEO Howard Stringer. The strategy has been Howard Stringer’s goal since he took over in the middle of 2006. Sony has been long viewed for making music players, cameras, and TVs, but has never focused on creating software to enhance its products. According to analysts, Sony’s strategy of creating software is a step in the right decision and should lead to future growth in sales.
The article also mentions about how Sony is currently during in this global recession. According to the article, Sony’s business has been hit hard by the recession and has Sony cutting back on electronics. Sony predicts that its sales will also fall about six percent in the near future. Sony’s biggest problem has to deal with two of its worst-performing products which are video games and TVs. Sony is trying to make a comeback by cutting corners wherever it can afford too, but with sales not heading in the right direction it’s not going to be an easy task which is also why the company is looking forward to creating more interaction with its products.
Reference: Hall, Kenji. (2009). Sony Unveils Its Answer to Apple’s iTunes. Businessweek. Retrieved from: http://www.businessweek.com/globalbiz/content/nov2009/gb20091119_588376.htm
Russia and Austria discuss South Stream pipeline
Apparently, Russia wants to increase its power as the top energy supplier to Europe by asking Austria to join them in what they call the South Stream natural gas pipeline project. Prime Minister Vladimir Putin stated on Wednesday that he wanted to strengthen Russia’s role as top energy supplier. Austria is loyal to Nabucco which is a rival pipeline project that has the support of the U.S. and European Union. Nabucco is also the only project that will supply gas to Europe, but will not be under Russian control. According to the article, Putin and the Austrian Chancellor Werner Faymann have both agreed to make a draft agreement on cooperation in South Stream. “Faymann said South Stream is in Austria’s interests and that Austria’s government had given a mandate to start negotiations two weeks ago”. He also notes that both South Stream and Nabucco shouldn’t been seen as rivals. The European Union has concerns about relying too much on Russia for energy because of the incidents that left several European countries without gas for two weeks. South Stream is one of two pipeline projects that Russia is promoting to help the struggling economically and the “politically turbulent Ukraine and Belarus. Apparently there are also disagreements between Putin and Faymann about Austrian Airlines and the flights to Russia. Putin has extended the current agreement, but plans to end it soon because the company was bought out by Germany’s Lufthansa. If Austria agrees to do conduct business with Russia with the South Stream project, both countires will be providing European countries with gas in the future.
Reference: Vasilyeva, Nataliya. (2009). The Associated Press. Russia and Austria discuss South Stream pipeline. Businessweek. Retrieved from: http://www.businessweek.com/ap/financialnews/D9BTGDB81.htm
According to the article, AirTran Airways believes that there is more opportunity to boost up revenue from add-on fees that it passes on to their customers. According to the Chief Financial Officer of AirTran Airways Arne Haak, customers want to be able to buy the cheapest ticket they can get, but don’t really mind how much fees they have to pay during the process. Arne Haak believes that charging customers for seat assignments at the time they are being booked is one area that the company can create more revenue. AirTran Airway which is based in Atlanta expects to make about $340 million in revenue which would include the increased add-on fees that are being going to be enforced. The growth in revenue will be up 45 percent from 2008. “AirTran has benefited by having low costs and focusing on domestic routes where it believes it can make money”. Also recently the company has been adding service to the Caribbean. Even with the recession, AirTran’s has been one of the companies to actually increase profit. AirTran is on of the most profitable U.S. carriers this year. According to the article, the company reported about $10.4 profit in their third-quarter report. The huge increase of revenue is largely due to the add-on fees that are being enforced by low-cost carriers and AirTran Airways. Haak believes that the add-on fees are here to stay because people will always want to fly at the cheapest price they can get which AirTran has been providing its customers for years.
Reference: Weber, Harry. (2009). The Associated Press. AirTran sees more opportunity for fee revenue. Businessweek. Retrieved from: http://www.businessweek.com/ap/financialnews/D9BPF8H80.htm
According to the article posted on Businessweekly.com, NBC has taken the meaning of “green screen” to another level. NBC has planned to spread a pro-environmental message next week using its five prime-time entertainment shows. NBC’s television series 30 Rock leads the way, which will show Al Gore (former vice-president) takes on a cameo role. The other television series that will be adding to the environmental theme are The Biggest Loser, The Office, Heroes, and Community. NBC’s “green” campaign has been operating for three years already and has focused largely on off-camera topics such as making company workplaces more eco-friendly. Also, information programs, as well as the news have been also enlisted to do stories about environmental issues. According to the article, the show 30 Rock will air a show that will help people relate and better understand the process of helping the environment. Behind the scenes though, the show has done its part by using chemical-free cleaning products and by removing water bottles in favor of water filters. Also the crew members rent hybrid vehicles. The other television shows mentioned will soon follow the same example as 30 Rock. During next week the shows will air their own version of spreading the word about environment issues. NBC new shows have already been leading the pro-environment movement. Such shows as The Today Show and Meet the Press have already done shows bringing up the topic. The weather channel has also been advising their viewers to lower their thermostats because it is more environments friendly. “Green screens, by the way, are blank screens on news sets upon which video or maps are projected”.
Reference: Bauder, David. (2009). The Associated Press. NBC enlists prime-time programs in green message. Businessweek. Retrieved from: http://www.businessweek.com/ap/financialnews/D9BTD4500.htm
Report: Dell to make Android phone for AT&T
According to the article, Dell Inc. is currently developing a new smart phone for AT&T that is able to run on Google’s Android phone operating system. The new smart phone is set to debut early next year, but Google, AT&T, and Dell declined to add a comment. The rocky economy has shaken Dell’s main product sales and analyst believe that Dell will fall faller down if it doesn’t do something fast which is why they believe that expanding and increasing it’s mobile technology is the way to go. In 2007 Dell hired a division executive from Motorola which spread rumors that Dell was working towards a new smart phone. Currently the Android is free for phone makers to modify and use which has made it very popular and is making its path onto better high-end phone which will rival that of Apple’s Iphone. AT&T currently sells the iphone, but isn’t afraid to offer other rival phones like the blackberry. I also heard about Verizon and Google teaming up together to develop the new smart phone Android which is why I think it is a good idea that AT&T jumped on board too. At this point the Android doesn’t come close to the iphone in the number of application it offers people, but eventually with time and development it should mirror that of the iphone with the same amount of apps offered. The Android will only benefit both businesses and customers because Verizon, Google, and AT&T plan to invest a lot of money and time into which will result in be services, phones, and operating systems.
Reference: (2009). The Associate Press. Report: Dell to make Android phone for AT&T. Businessweek. Retrieved from: http://www.businessweek.com/ap/financialnews/D9B6GNCG1.htm
Brussels Considers EU – Wide Tax Database
According to the article the European Commission have recommended a system that some have considered potentially controversial that will boost their fight against tax fraud by letting authorities the right to access taxpayer data in nearby countries. The reason for such a controversial proposal is because of the economic situation which has taken its troubles out on the economy worldwide. According to European Commissioner Laszlo Kovacs, because of the economic situation it is vital that the fight against tax fraud be done precisely and effectively. He also states that the main key is that both administrative cooperate between other tax administrations. According to the commissioner’s proposal all national tax officers will have the necessary means to do whatever it takes to stop tax fraud, but also will treat other state tax administrations will respect. His creation is the Eurofisc. “The key element of the blueprint is the creation of “Eurofisc”—a scheme for rapid exchange of targeted information to which the authorities from all 27 EU member states would have direct access, in order to stop fraud and catch fraudsters,” Mr. Kovacs said.”(Quote) The reason for the proposal is to prevent fraud over value added tax which according to the article happens when someone buys value added tax-free goods in a certain country and then sells them in a different state with the value added tax terms happen, but escape before having to pay the taxes. Europe’s government has been losing about 10% of its VAT receipts every year which is around 200 billion dollars. So finding a way to prevent such losses will be a big benefit for the Europe economy.
Reference: Kubosova, Lucia. (2009). Europe. Brussels Considers EU – Wide Tax Database. Businessweek. Retrieved from:
http://www.businessweek.com/globalbiz/content/aug2009/gb20090820_592668.htm
Wal-Mart’s Latest Ethics Controversy
According to the article, Chalace Epley Lowry who started working as a administrative assistant at Wal-Mart stores in it’s communications dept. have to endure a whole day of a orientation that really focused on ethics. Lowry, who now is unemployed, believed she saw a senior executive do some unethical things. Mona Williams, who is VP for corporate communications had asked Lowry to copy some papers. Lowry thought the papers were related to stocks, but later found out that Wal-Mart was planning to buy back stock. They planned to buy back $15 billion stocks.
According to the article, Lowry worried that Mona Williams might have done some unethical things. Lowry thought Williams traded on insider information. According to Wal-Mart Williams didn’t do anything wrong. Lowry now is looking for another position within the company because her information was discussed to Mona Williams. Mona Williams and the communication department have been the leaders to enforce good work ethics. The compliant against Williams is just another problem Wal-Mart stores has to deal with. Wal-Mart has already a “Tarnished image” because of its most recent firing of high-profile executive Julie Roehm. According to Wal-Mart Roehm was released because she took gifts from vendors and apparently had an affair with an employee. Wal-Mart and Roehm are scheduled to meet in court soon because Wal-Mart currently has a lawsuit against Roehm. A lot of people don’t like Wal-Mart and having issues about ethics isn’t going to win them back. Wal-Mart needs to enforce stricter ethic policies because all these scandals have just tarnished its image.
Reference: Gogoi, Pallavi. (2007). Wal-Mart’s Latest Ethics Controversy. Businessweek. Retrieved from: http://www.businessweek.com/bwdaily/dnflash/content/jun2007/db20070612_548611.htm
Travel Web Sites Try Waiving Fees
According to the article, businesses such as Travelocity, Expedia, and Orbitz have generally charged a $7 fee to each transaction, but now have decided to put those fees on hold until May 2010. Usually people that are looking forward to traveling would avoid these sites because of the fees, but they should consider checking these online travel agencies. According to the article, Expedia which is the biggest travel agency decided in April to waive its fees which made it the first business of its kind to do such a thing. Travelocity an Orbitz soon followed Expedia example and suspended fees as well. According to Henry H. Harteveldt who is Forrester Research travel analyst said that big advantage that online airline websites had is no gone. “Travelocity says the suspension of booking fees has helped it gain market share”. The travel agencies didn’t state what they plan to do after the May 2010 deadline they set for themselves. Some of the agencies think that with fees being cut, they believe that they can take control of a larger part of the market. I believe that if these agencies are able to provide a service without putting fees on top of it, then it will help gain more customers. Every time I go out of town, I always book hotels using travel agencies and now that they have cut fees for flying I might just visit my family in Texas. I’m happy to see that travel agencies are doing smart things to attract new customers and suspending fees will help them with that.
Reference: Freed, Joshua. Travel. (2009) Travel Web Sites Try Waiving Fees. Businessweek. Retrieved from: http://www.businessweek.com/investor/content/apr2009/pi20090422_479070.htm
Yahoo and Intel: Tech Sector Outcasts
In today’s world, investors use the reports from Yahoo! (YHOO) and Intel (INTC) for guidance when it comes to the tech sector’s health. Yahoo! is one of the largest media companies on the web. Intel is the world’s largest creator of computer chips which indicates the demand for computers and there components. Yahoo and Intel, posted a huge drop in net income in there second-quarter report which was release July 17. “Yahoo said net income fell to $160.5 million in the three months ending June 30, from $164.3 million a year earlier, with per-share earnings unchanged at 11 cents”. A major problem for these loses are due to their inability to keep up with the latest trends of using creative ways to add more ads with their search results like Google. Yahoo is way behind Google in that Google actively improves itself. Intel, like Yahoo is suffering and is not able to benefit from the growing demand in tech areas. Intel, like Yahoo is with Google, has problems because of its rivalry with Advanced Micro Devices. It seems like both Yahoo and Intel are losing the war. Yahoo believes that the process is going to take a long time, but it is pulling all its marbles on the new search-ad system called “Panama” which is designed to improve search queries with ads that will possibly create more revenue. Yahoo executives still believe that they need to do much more. They believe that investing in its advertising capabilities is one solution. The company must also find a solution about the increasing competition for ad dollars from popular online social networks. “That means coming up with creative ways to attract, and keep, the attention of audiences as well as advertisers.” Reference: Holanhan, Catherine. News Analysis. (2007). Yahoo and Intel: Tech Sector Outcasts. Businessweek. Retrieve from: http://www.businessweek.com/technology/content/jul2007/tc20070717_377371.htm
Sony Is Still Feeling the Recession’s Bite
According to the article, the global recession has affected every type of business, but it has hit the Sony Company earnings troublesome. On July 30, 2009 the Sony Company said that it posted a $271 million loss for the quarter of April-June. A year ago Sony posted a $772 million profit, this year it lost much more. The revenues also dropped from about 19% to that of $16.8 billion. Sony’s Chief Financial Officer Nobuyuki Oneda said that Sony had predicted to have a net lost. “Nobuyuki Oneda said the company expected stiff price competition in the electronics industry in the coming months and was sticking with earlier forecasts for an operating loss of $1.16 billion in the fiscal year through March 2010.”
Sony’s Chairman and CEO, Howard Stringer, tried to repair the companies profitability, but wasn’t able to due to the economic downturn and the financial issues. Oneda blames the global recession as part of the problem, but he also believes that the yen’s growing strength has made the company’s products much less competitive.
Now the company it trying to figure out if it is going to be able to stop its losses. While Sony is suffering, its competition is actually profiting from it. “Sony ranks second globally in flat-screen liquid-crystal displays, behind Samsung Electronics, but analysts predict it will lose market share—from 14% last year to below 12% this year. Sony sells a mere one-sixth as many Walkman media players worldwide as Apple (AAPL) sells iPods, according to Credit Suisse (CS) estimates. Sony was a pioneer with its eBook Reader, but it now trails Amazon’s (AMZN) Kindle, and sales of the company’s PlayStation 3 gaming console lag behind those of Nintendo’s (7974.T) Wii”. Due to its competitors Sony is facing many issues.
Oneda said the company continues to whittle down the number of suppliers. But the company isn’t just cutting back; it’s also bolstering its TV business by investing $715 million by April 2011 for one-third of a joint venture with Sharp (6753.T) to make liquid-crystal-display TV panels.
Even though Sony faces many problems, it is set to continue working to get back to its old glory form. “Oneda said the company continues to whittle down the number of suppliers. But the company isn’t just cutting back; it’s also bolstering its TV business by investing $715 million by April 2011 for one-third of a joint venture with Sharp (6753.T) to make liquid-crystal-display TV panels.” Oneda believes that the turning point can be reached, but it is going to take a lot of hard work to compete with its rivals.
Reference: Hall, Kenji. Consumer Electroncs. (2009). Sony Is Still Feeling the Recession’s Bite. Businessweek. Retrieved from: http://www.businessweek.com/globalbiz/content/jul2009/gb20090730_761001.htm
