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China playing rough with big media

Written By limadu on Jumat, 31 Januari 2014 | 21.29

media china

Western media outlets have published stories that detail the wealth accumulated by Chinese officials, including President Xi Jinping.

HONG KONG (CNNMoney)

The reporter, Austin Ramzy of The New York Times, left Beijing on Thursday for Taipei. Chinese officials had declined to issue new work documents to Ramzy, a longtime resident of China who has in the past renewed his credentials without incident.

Ramzy will join a growing group of reporters that have been denied access to the mainland.

China has for months declined to act on the visa applications of Times employees Chris Buckley and Philip Pan. Correspondents for The Washington Post, Bloomberg, Al Jazeera and Reuters have been similarly barred from reporting in China. In December, more than two dozen Times and Bloomberg staffers were issued visas at the very last minute.

Journalists face obstacles in other ways. Earlier this month, CNN's Beijing correspondent, David McKenzie was assaulted by Chinese security while covering a trial of a high-profile Chinese activist.

In a statement, the executive editor of The Times, Jill Abramson, said the news organization "remains committed to covering China as our thorough and frequent coverage of the country attests." She added, "We are working with Chinese authorities and hope that all of our talented journalists will be able to work there normally."

Chinese officials have attributed delays to paperwork mistakes and have said it is China's right as a sovereign nation to decide which individuals should be granted visas and residency permits.

On Thursday the White House said in a statement that it was "very disappointed" that Ramzy was forced to leave. White House press secretary Jay Carney said that the actions of Chinese authorities "are not consistent with freedom of the press -- and stand in stark contrast with U.S. treatment of Chinese and other foreign journalists."

Ramzy, for his part, wrote on Twitter that he was "sad to be leaving Beijing. Hope I can return soon."

Related: China's anti-corruption drive eats into growth

For foreign media outlets hoping to grow their business in China, the staffing challenges underscore the risks associated with aggressive reporting on Chinese government officials.

"Doing any kind of business in China as a foreign company is hard," said David Schlesinger, former editor-in-chief of Reuters News who also served as the chairman of Thomson Reuters China until August 2012. "And if all businesses are difficult, the media business is doubly so."

Schlesinger is now the founder of Tripod Advisers, a media consulting firm specializing in emerging markets like China.

Related: Foreign firms will always struggle in China - Baidu CEO

Despite the risks for foreign companies, analysts think China's media sector is poised for explosive growth.

Western media, including the Times, The Wall Street Journal and Reuters, have invested heavily into developing Chinese language news websites. Yet these ventures -- and their English language sister publications -- have at various points run up against Chinese censorship.

Bloomberg's website was blocked by authorities in China following the publication of a story that detailed the massive wealth accumulated by the family of Xi Jinping, the incoming party chief.

The Times' website was similarly blocked after the paper published an expose on the $2.7 billion fortune amassed by the family of former Premier Wen Jiabao.

"The leadership is still nervous about stories like this and maintaining social order," said Bruce Dover, a media consultant who was in charge of News Corp's business development in China from 1992 to 1998. "They are still very twitchy about stories that are negative about China, and particularly the Communist Party."

Bloomberg has another business interest in China, selling its financial-information terminals.

Sales in China make up a small portion of Bloomberg's overall revenue, according to founder Michael Bloomberg, who recently estimated that his company probably has about 3,000 terminals there, out of some 315,000 overall.

The New York Times reported in November that Bloomberg editors in New York had killed a story that exposed the financial dealings of a Chinese tycoon with close ties to the Communist Party, leading critics to accuse the company of self-censorship. Bloomberg executives and editors have disputed that version of events and said the story was not ready for publication.

A Bloomberg spokesman declined to comment for this story. Michael Bloomberg, in an interview with Capital New York, said terminal sales in China had been minimal because the country "doesn't have a big developed banking system." Nodding to the country's potential as a growth market, he added, "Some day it will."

Said Schlesinger: "Any media company that wants to do both journalism and business in China will face a very difficult set of choices." To top of page

First Published: January 31, 2014: 9:05 AM ET


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Wal-Mart: Food stamp cuts to hit profits

NEW YORK (CNNMoney)

The cut in food stamps went into effect Nov. 1. Food stamps had been increased during the height of the recession, but that expansion expired without Congressional action.

The expiration of the program saved the government $5 billion.

And more cuts in food stamp funding could be on the way. A bipartisan deal on a new farm bill reached earlier this week could trim $90 a month in benefits for 850,000 food stamp recipients.

The nation's largest retailer also said bad weather was affecting its financial performance.

Shares of Wal-Mart (WMT, Fortune 500)fell in premarket trading on the warning. To top of page

First Published: January 31, 2014: 8:29 AM ET


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Nadella would be safe choice for Microsoft

satya nadella microsoft

Satya Nadella has done a solid job leading Microsoft's cloud business. And his reward appears to be the CEO job.

NEW YORK (CNNMoney)

According to several news reports, Nadella will likely be named Microsoft's new CEO in the coming weeks. CNN could not independently confirm that, and Microsoft (MSFT, Fortune 500) declined to comment on the speculation.

As Microsoft's cloud and enterprise group chief, Nadella oversees the company's server software and back-end technology for corporate customers. He also is in charge of several consumer cloud products, including Office 365, the Bing search engine, Xbox Live and Skype.

This is one of Microsoft's best-performing business units: Cloud services sales more than doubled last quarter and corporate software licenses outpaced the rest of the industry. As Microsoft Windows revenue dries up amid a PC sales swoon, Nadella's group has been instrumental in driving Microsoft's growth.

In many ways, Nadella is an obvious choice for CEO. He is personable and often funny in public interviews. He isn't intimidating in the way that current CEO Steve Ballmer and former CEO Bill Gates (who is still chairman) often were. He doesn't have Ballmer's notorious bombast either. He stays on message.

Nadella also oversees a division where Microsoft believes its bread will be buttered in the coming years. Corporate revenue already makes up two-thirds of Microsoft's overall sales.

But Nadella may not shake things up too much at Microsoft. He is not a corporate visionary in the way that Ford (F, Fortune 500) CEO Alan Mulally is. Mulally was widely believed to be a top candidate for the Microsoft job but has repeatedly said he's staying at Ford.

Related: Microsoft about to take Windows XP off life support

Nadella isn't bringing fresh perspective or any outside influence. Instead, Nadella is a 22-year veteran of Microsoft who has been overseeing the less-sexy corporate software and services side of the company since 1992.

Before starting his current role, he also headed Microsoft's server and tools business, its corporate division and research and development for Microsoft's online services unit. Prior to joining Microsoft, Nadella worked at Sun Microsystems, which is now owned by Oracle (ORCL, Fortune 500).

Microsoft's most apparent weaknesses, however, are in its consumer business. Windows 8 has sold poorly in part because Microsoft radically redesigned the familiar operating system to move beyond the walls of the PC. It was a bold and necessary move, but Microsoft threw consumers in the deep end without guiding them along

Related: Microsoft would be better off it hired Adobe's CEO

The company, meanwhile, is watching Apple (AAPL, Fortune 500) and Google (GOOG, Fortune 500) pass it by in the fast-growing mobile business. Some consumers are replacing their PCs with tablets like the iPad, a device that doesn't run Windows. Microsoft Surface and Windows Phone have garnered some critical acclaim, but their sales have been paltry compared to iOS and Android devices.

Microsoft is making a big bet on its own hardware though with the pending purchase of the mobile device business of Nokia (NOK).

But given Nadella's background, it seems unlikely that he will radically change Microsoft's consumer strategy. And if Microsoft doesn't gain ground against Google and Apple, Microsoft's biggest competitors will quickly become cloud giants Amazon (AMZN, Fortune 500), IBM (IBM, Fortune 500) and Oracle.

If that's the case, then Nadella might just be the best guy for the job. To top of page

First Published: January 31, 2014: 8:31 AM ET


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New ammo packs 3 shots into one bullet

Written By limadu on Kamis, 30 Januari 2014 | 21.29

LAS VEGAS (CNNMoney)

So he invented the Multiple Impact Bullet, a unique new round that, upon firing, splits into several fragments connected by ballistic-strength fiber.

The fiber holds the shrapnel together in a Y-shaped pattern, which makes for much better accuracy than a shotgun's blast of pellets. That minimizes the chances of hitting unintended people or things, said Kuchman.

The bullets spread to a diameter of 14 inches for handguns and 24 inches for long guns. The fiber itself, which is spooled up inside the core of the slug, slices paper targets to ribbons, but does only "superficial" damage to flesh, Kuchman said.

They're intended for self defense, says Kuchman. Multiple impact bullets improve the accuracy of nervous, would-be victims with unsteady hands by giving them several chances to hit their target with just one shot. The company uses slogans such as, "Because you can't afford to miss" and "First hit advantage is everything!"

Related: Machine gun tourism in Sin City

Todd and his brother Jaye, who refer to themselves as the "bullet brothers," founded the Denver-based Advanced Ballistic Concepts, or ABC, in 2010 and launched their new bullet on Jan. 6.

The company says it already has $100,000 worth of orders. "It's been selling [like] gangbusters," said Kuchman. "In fact, our web site crashed after our initial press release."

The ammunition is available on ABC's web site, as well as at some Colorado gun stores. The 10-round packs of .45 bullets for handguns and 12-gauge slugs for shotguns run about $50 or $60. Soon, 9mm will be available also.

ABC employs a full-time staff of 11 and about 90 part-time assemblers.

Related: Duck Commander launches line of Mossberg guns

Earl Griffith, firearms technology expert for the U.S. Bureau of Alcohol, Tobacco and Firearms, said that generally speaking, any bullet is legal as long as it can't pierce armor.

While the Multiple Impact Bullet is certainly innovative, says WedBush gun analyst Rommel Dionisio, it will be tough to break into a market dominated by "tried-and-true" brands like Winchester and Remington.

Dionosio said it might take extensive testing, which could take years, and maybe even adoption of the ammunition by a major law enforcement agency to give it the credibility it needs to succeed in the consumer marketplace.

Related video: Shooting full auto at the SHOT Show

The Kuchmans grew up on a farm in a relatively rural section of New Jersey where they learned to hunt and fish. Guns were a way of life.

Todd Kuchman has invented various products over the last 12 years, including the Scratch-less Disc, which fell by the wayside in a digital world.

ABC already makes several other types of ammunition, specializing in "green" metals free of lead. They include the Stinger, a bullet that's advertised as "less lethal" because it's made of aluminum, plastic or rubber. It also sells the Stunner, which inflicts more serious damage, but is designed to not pass through walls.

"Our mantra is perpetual innovation," said Kuchman. To top of page

First Published: January 30, 2014: 6:57 AM ET


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Stocks: Investors hoping for a rebound

sp 500 futures 7

Click on chart to track premarkets

NEW YORK (CNNMoney)

U.S. stock futures were edging slightly higher ahead of the opening bell, though global markets were predominantly in the red.

Investors are watching international developments closely, after a reduced flow of cheap money from the Federal Reserve accelerated a sell-off in some emerging market currencies.

U.S. stocks fell more than 1% Wednesday after the Fed said it was cutting another $10 billion per month from its economic stimulus program. Investors were disappointed the central bank didn't address the recent turmoil in emerging markets.

The turmoil has prompted a flight from riskier assets, including stocks.

The Dow Jones industrial average has fallen on six out of the last seven trading days and is down 5% so far this year. The S&P 500 index has dropped by 4% since the start of 2014, with the bulk of the losses sustained over the past few days.

Related: Fear & Greed Index slides back into extreme fear

Investors will get their first reading of U.S. fourth-quarter GDP from the Commerce Department Thursday at 8:30 a.m. ET. Briefing.com's consensus forecast is calling for annual growth of 3% for the broadest measure of the economy.

Also at 8:30, the government will release its weekly report on initial jobless claims.

Beyond economic data, it's another day chock full of earnings reports.

"Today is one of the busiest days on the corporate reporting calendar with 10% of the S&P 500 provid[ing] earnings updates, including Exxon Mobile and Google which are the second and third largest companies by market cap," Deutsche Bank analyst Jim Reid wrote in a market note.

UPS (UPS, Fortune 500) and Exxon Mobil (XOM, Fortune 500) are on deck to report ahead of the opening bell, while. Amazon (AMZN, Fortune 500) and Google (GOOG, Fortune 500) are set to report in the afternoon.

Related: CNNMoney's Tech30

There have been some bright spots. Facebook (FB, Fortune 500) shares surged more than 13% in premarket trading following strong quarterly sales and earnings results.

Google shares also rose after the company announced it was selling its Motorola Mobility smartphone business to China's Lenovo for $2.9 billion.

Related: Asia stocks battered by emerging market fears

European markets were in negative territory in morning trading, and Asian markets also took a knock.

Japan's Nikkei dropped 2.5%, while Hong Kong's Hang Seng shed 0.5% and Australia ASX All Ordinaries lost 0.8%. The Shanghai Composite, which often diverges from other Asian markets, advanced 0.6%.

The HSBC report on Chinese manufacturing showed a retraction, coming in at 49.5 for January, down slightly from the flash reading of 49.6. Any reading below 50 signals contraction. To top of page

First Published: January 30, 2014: 5:14 AM ET


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Economy grew solidly in fourth quarter

NEW YORK (CNNMoney)

Gross domestic product -- the broadest measure of economic activity -- grew at a 3.2% annual pace in the fourth quarter, according to a Commerce Department report. That figure beat economists' expectations, and although it's not indicative of gangbusters growth, the data seems to show the economy is moving forward modestly. GDP rose at a 4.1% clip in the third quarter.

Consumer spending picked up at a 3.3% annual pace, and U.S. exports to other countries outpaced imports.

But cuts in federal government spending continued to weigh on growth. GDP would have grown at a 4.2% pace in the quarter, if it weren't for federal spending cuts.

For the whole year, the economy grew 1.9%, down from 2.8% in 2012. To top of page

First Published: January 30, 2014: 8:59 AM ET


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Flipagram photo app tops the charts

Written By limadu on Rabu, 29 Januari 2014 | 21.29

NEW YORK (CNNMoney)

Flipagram allows you to select multiple photos from your phone and create a short slideshow. Instead of just capturing a single moment through one photo, the creators of Flipagram see it as a way for users to tell stories with mini-movies.

Photos from a vacation with family or an outing with friends can turn into a single Flipagram. Plus the app lets you set slideshows to music, which you can choose from your phone or from the app itself. You can buy the music you hear on a Flipagram through a link on the app.

Celebrities like Britney Spears and rapper Macklemore have already started using the app. Spears recently used Flipagram to promote the launch of her Las Vegas show.

Unlike its rivals, Flipagram doesn't have its own social network yet (the company says it's coming). But Flipagrams can be posted to Facebook and Instagram -- you might have already seen your friends' Flipagrams showing up on your feeds.

Related: Sony gets rights to Sandberg's 'Lean In'

The company claims there are "tens of millions" of people using Flipagram, but it wouldn't disclose the exact amount of registered users.

Flipagram says it isn't fixated on making money off of their idea just yet. In fact, the app's makers made it free to download after originally charging 99 cents for the software.

Instead, Flipagram's team says it is currently focused on improving the app and growing its user base.

"If we do that well and continue this type of growth, I think there are manifold ways of making money," Farhad Mohit, CEO of Flipagram, told CNNMoney.

Mohit said the Flipagrams themselves could become an important revenue stream for the company. Just as Britney Spears used the app to promote her concert on the platform, Mohit said advertisers could make Flipagrams in the future.

"Commercials are mini stories, so over time we will see many different use cases," Mohit indicated.

Mohit isn't one of the founders of the Flipagram, but the creators came to him to help steer the company. Mohit is an Iranian-American who helped to create Shopzilla.com, a shopping comparison website that Scripps (SNI) bought for $525 million in 2005.

The path to a payday for many hot apps is being acquired by a bigger company like Facebook (FB, Fortune 500) or Yahoo (YAHOY), but Mohit said he believed that the app could be profitable down the road on its own.

For now, Flipagram has to prove that it is more than just the app of the moment. Time will tell if it has the staying power to avoid becoming just another one of the plethora of photo sharing apps that people download, use a few times and then delete. To top of page

First Published: January 29, 2014: 7:04 AM ET


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Microsoft is about to take Windows XP off life support

windows xp

Microsoft will end official support for the 12-year-old Windows XP on April 8.

NEW YORK (CNNMoney)

You wouldn't think that killing off an operating system that debuted in the first year of the Bush administration would ruffle too many feathers. But an amazing 29% of computers across the globe are still running Windows XP, according to NetMarketShare. That makes it the world's second most widely used operating system, just behind Windows 7.

Microsoft's (MSFT, Fortune 500) plan to end support for XP doesn't mean that a third of the world's PCs will just stop functioning on April 8. But there are some very real consequences of continuing to use the operating system.

After April 8, Windows XP computers will be more susceptible to malware and viruses beginning, since Microsoft will no longer address major holes in the software. Although antivirus software will continue to fend off some malicious attacks, Microsoft's security updates provide an essential line of defense.

Related: 5 things we want for Windows 9

For Windows XP users, the best course of action is to bite the bullet and buy a copy of Windows 8. The problem is that most older computers won't be able to upgrade to Windows 8. Many of those consumers will have to buy a new PC. Microsoft has an upgrade assistant that allows people to determine whether their computers are compatible with the latest version of Windows.

For those who are able to upgrade but aren't ready to make the jump to the fully redesigned Windows 8, Windows 7 is an option. It's still on sale, offers a more familiar PC experience and will be supported until 2020.

The Windows XP impact will be felt more by companies than by consumers. Forrester Research estimates that 20% of North American and European corporate computers are still running Windows XP. But that will soon change: Forrester forecasts that only 6% of those companies' PCs will be running Windows XP by April.

That remaining 6% will predominately be small and medium-sized companies and government agencies, where budget restraints may pose a problem, according to Scott Dowling, a Microsoft software consultant for En Pointe Technologies. The vast majority of large Western businesses have already upgraded to Windows 7 or Windows 8, but small businesses have been slower at catching up.

Related: Microsoft sales soar 14%

In China, however, XP-related problems will likely be much more pronounced. About three-quarters of Chinese PCs are running XP, according to NetMarketShare.

Thousands of ATMs will also potentially be exposed after Microsoft ends Windows XP's life support. A recent Bloomberg Businessweek story revealed that 95% of ATMs in the US are still running Windows XP, and only about 15% of them will be upgraded before April 8.

ATMs have already proven vulnerable to malware attacks, and without Microsoft around to patch things up, it's going to be a slow, costly endeavor for ATM companies to get their machines updated or replaced. (It's worth noting that Microsoft has been warning them of this deadline for years.)

So why is Microsoft killing off Windows XP? The operating system has lasted far longer than Windows versions of the past, and patching the ancient-by-tech-standards OS is exhausting valuable Microsoft resources. Microsoft has pushed back XP's death date for several years after initially planning to kill it off by 2010.

To soften the blow for its corporate and ATM customers, Microsoft will sell custom support that will allow companies to receive additional security patches. But Dowling have heard reports from customers that the cost of custom support is prohibitive.

For the rest of the world, it's time to get updating. To top of page

First Published: January 29, 2014: 7:11 AM ET


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From dog toys to software -- seriously!

lettuce employees candid

Lettuce cofounders Raad Mobrem (left) and Frank Jones (right), with one of their employees (seated).

NEW YORK (CNNMoney)

Raad Mobrem did. Cofounder and CEO of Lettuce, a Los Angeles-based firm that makes inventory management software, he started out making dog toys -- and then realized there was even more demand for his company's in-house order system.

Not surprisingly, the toughest part of pivoting was simply deciding to do it.

"I've always been focused on doing one thing really well," Mobrem said. "So at first, it was hard for me to see demand for our software app as anything but a distraction from our 'real' business."

Mobrem started that business, called Dura Doggie, in 2008. As a mechanical engineering major at the University of California at Santa Barbara, Mobrem took an entrepreneurship course and got an A-plus on a business plan for a pet toy firm. With Frank Jones, a college friend who'd already graduated, the pair decided to make Mobrem's idea a reality.

Related: Hardest part of being the boss? Firing people

They did, and it took off fast, with Dura Doggie's pet toys on the shelves of more than 2,000 retail stores across the U.S., Canada and Asia. There was just one problem, and it was a big one.

"We were taking orders and processing them really inefficiently. It was all done on paper, so some orders weren't even legible," Mobrem said. Dura Doggie was also spending about $3.50 per catalog, which they gave away. "For a start-up that was trying to stay lean, it seemed crazy."

So Jones developed a mobile app that not only replaced the catalogs but also processed orders, tracked inventory and validated credit cards. It caught on.

"People kept coming up to us at trade shows to watch us do everything on iPads," Mobrem said. "One company offered us $50,000 to customize something similar for them."

Throughout 2010, those requests kept coming in. So in early 2011, Jones, who was Dura Doggie's chief technical officer, started spending all his time on the inventory-management platform, figuring out how to customize it for outside clients.

Related: The right way to leave your business behind

Mobrem was lucky in two respects. First, the cofounders found an eager buyer for Dura Doggie, so they were able to make a clean break without warehouses full of inventory to sell off. Second, the same three investors they'd had from the outset (one of whom is Mobrem's dad) stayed on board, committing nearly $2 million for Lettuce's launch.

Pivoting from one industry to a totally different one has been tricky.

"Be prepared for the rules to be unfamiliar," Mobrem advised. "Don't get discouraged if it takes some time to adjust."

One difference between dog toys and high tech, he said, is "the etiquette of approaching potential investors. In most businesses, you can cold call investors, but that isn't how it works in tech, where you can't get a meeting without first being introduced through a mutual acquaintance."

Another big adjustment: Tech employees, of whom Lettuce now has 16. "You have to treat software developers like rock stars," he said.

Unlike the workers who filled orders at Dura Doggie, software engineers "expect a lot of praise and recognition for their work," he explained. "They're proud of what they do, and they need to know that you appreciate it."

Related: The danger when one client is 80% of sales

Lettuce isn't profitable yet, and Mobrem won't reveal the firm's revenues. Still, he said the potential market for inventory-management software is so big, he's glad they made the change.

"If you see a way to get into a business that could be even bigger and better than the one you have now, be realistic," he said. "Take emotion out of it, put your fears aside, and just look at the numbers."

If he'd done that when Lettuce's first app showed promise, he would have taken the plunge "five or six months sooner -- which, in the software world, is a long time." To top of page

First Published: January 29, 2014: 7:15 AM ET


21.29 | 0 komentar | Read More

Flipagram photo app tops the charts

NEW YORK (CNNMoney)

Flipagram allows you to select multiple photos from your phone and create a short slideshow. Instead of just capturing a single moment through one photo, the creators of Flipagram see it as a way for users to tell stories with mini-movies.

Photos from a vacation with family or an outing with friends can turn into a single Flipagram. Plus the app lets you set slideshows to music, which you can choose from your phone or from the app itself. You can buy the music you hear on a Flipagram through a link on the app.

Celebrities like Britney Spears and rapper Macklemore have already started using the app. Spears recently used Flipagram to promote the launch of her Las Vegas show.

Unlike its rivals, Flipagram doesn't have its own social network yet (the company says it's coming). But Flipagrams can be posted to Facebook and Instagram -- you might have already seen your friends' Flipagrams showing up on your feeds.

Related: Sony gets rights to Sandberg's 'Lean In'

The company claims there are "tens of millions" of people using Flipagram, but it wouldn't disclose the exact amount of registered users.

Flipagram says it isn't fixated on making money off of their idea just yet. In fact, the app's makers made it free to download after originally charging 99 cents for the software.

Instead, Flipagram's team says it is currently focused on improving the app and growing its user base.

"If we do that well and continue this type of growth, I think there are manifold ways of making money," Farhad Mohit, CEO of Flipagram, told CNNMoney.

Mohit said the Flipagrams themselves could become an important revenue stream for the company. Just as Britney Spears used the app to promote her concert on the platform, Mohit said advertisers could make Flipagrams in the future.

"Commercials are mini stories, so over time we will see many different use cases," Mohit indicated.

Mohit isn't one of the founders of the Flipagram, but the creators came to him to help steer the company. Mohit is an Iranian-American who helped to create Shopzilla.com, a shopping comparison website that Scripps (SNI) bought for $525 million in 2005.

The path to a payday for many hot apps is being acquired by a bigger company like Facebook (FB, Fortune 500) or Yahoo (YAHOY), but Mohit said he believed that the app could be profitable down the road on its own.

For now, Flipagram has to prove that it is more than just the app of the moment. Time will tell if it has the staying power to avoid becoming just another one of the plethora of photo sharing apps that people download, use a few times and then delete. To top of page

First Published: January 29, 2014: 7:04 AM ET


19.33 | 0 komentar | Read More

Microsoft is about to take Windows XP off life support

windows xp

Microsoft will end official support for the 12-year-old Windows XP on April 8.

NEW YORK (CNNMoney)

You wouldn't think that killing off an operating system that debuted in the first year of the Bush administration would ruffle too many feathers. But an amazing 29% of computers across the globe are still running Windows XP, according to NetMarketShare. That makes it the world's second most widely used operating system, just behind Windows 7.

Microsoft's (MSFT, Fortune 500) plan to end support for XP doesn't mean that a third of the world's PCs will just stop functioning on April 8. But there are some very real consequences of continuing to use the operating system.

After April 8, Windows XP computers will be more susceptible to malware and viruses beginning, since Microsoft will no longer address major holes in the software. Although antivirus software will continue to fend off some malicious attacks, Microsoft's security updates provide an essential line of defense.

Related: 5 things we want for Windows 9

For Windows XP users, the best course of action is to bite the bullet and buy a copy of Windows 8. The problem is that most older computers won't be able to upgrade to Windows 8. Many of those consumers will have to buy a new PC. Microsoft has an upgrade assistant that allows people to determine whether their computers are compatible with the latest version of Windows.

For those who are able to upgrade but aren't ready to make the jump to the fully redesigned Windows 8, Windows 7 is an option. It's still on sale, offers a more familiar PC experience and will be supported until 2020.

The Windows XP impact will be felt more by companies than by consumers. Forrester Research estimates that 20% of North American and European corporate computers are still running Windows XP. But that will soon change: Forrester forecasts that only 6% of those companies' PCs will be running Windows XP by April.

That remaining 6% will predominately be small and medium-sized companies and government agencies, where budget restraints may pose a problem, according to Scott Dowling, a Microsoft software consultant for En Pointe Technologies. The vast majority of large Western businesses have already upgraded to Windows 7 or Windows 8, but small businesses have been slower at catching up.

Related: Microsoft sales soar 14%

In China, however, XP-related problems will likely be much more pronounced. About three-quarters of Chinese PCs are running XP, according to NetMarketShare.

Thousands of ATMs will also potentially be exposed after Microsoft ends Windows XP's life support. A recent Bloomberg Businessweek story revealed that 95% of ATMs in the US are still running Windows XP, and only about 15% of them will be upgraded before April 8.

ATMs have already proven vulnerable to malware attacks, and without Microsoft around to patch things up, it's going to be a slow, costly endeavor for ATM companies to get their machines updated or replaced. (It's worth noting that Microsoft has been warning them of this deadline for years.)

So why is Microsoft killing off Windows XP? The operating system has lasted far longer than Windows versions of the past, and patching the ancient-by-tech-standards OS is exhausting valuable Microsoft resources. Microsoft has pushed back XP's death date for several years after initially planning to kill it off by 2010.

To soften the blow for its corporate and ATM customers, Microsoft will sell custom support that will allow companies to receive additional security patches. But Dowling have heard reports from customers that the cost of custom support is prohibitive.

For the rest of the world, it's time to get updating. To top of page

First Published: January 29, 2014: 7:11 AM ET


19.33 | 0 komentar | Read More

From dog toys to software -- seriously!

lettuce employees candid

Lettuce cofounders Raad Mobrem (left) and Frank Jones (right), with one of their employees (seated).

NEW YORK (CNNMoney)

Raad Mobrem did. Cofounder and CEO of Lettuce, a Los Angeles-based firm that makes inventory management software, he started out making dog toys -- and then realized there was even more demand for his company's in-house order system.

Not surprisingly, the toughest part of pivoting was simply deciding to do it.

"I've always been focused on doing one thing really well," Mobrem said. "So at first, it was hard for me to see demand for our software app as anything but a distraction from our 'real' business."

Mobrem started that business, called Dura Doggie, in 2008. As a mechanical engineering major at the University of California at Santa Barbara, Mobrem took an entrepreneurship course and got an A-plus on a business plan for a pet toy firm. With Frank Jones, a college friend who'd already graduated, the pair decided to make Mobrem's idea a reality.

Related: Hardest part of being the boss? Firing people

They did, and it took off fast, with Dura Doggie's pet toys on the shelves of more than 2,000 retail stores across the U.S., Canada and Asia. There was just one problem, and it was a big one.

"We were taking orders and processing them really inefficiently. It was all done on paper, so some orders weren't even legible," Mobrem said. Dura Doggie was also spending about $3.50 per catalog, which they gave away. "For a start-up that was trying to stay lean, it seemed crazy."

So Jones developed a mobile app that not only replaced the catalogs but also processed orders, tracked inventory and validated credit cards. It caught on.

"People kept coming up to us at trade shows to watch us do everything on iPads," Mobrem said. "One company offered us $50,000 to customize something similar for them."

Throughout 2010, those requests kept coming in. So in early 2011, Jones, who was Dura Doggie's chief technical officer, started spending all his time on the inventory-management platform, figuring out how to customize it for outside clients.

Related: The right way to leave your business behind

Mobrem was lucky in two respects. First, the cofounders found an eager buyer for Dura Doggie, so they were able to make a clean break without warehouses full of inventory to sell off. Second, the same three investors they'd had from the outset (one of whom is Mobrem's dad) stayed on board, committing nearly $2 million for Lettuce's launch.

Pivoting from one industry to a totally different one has been tricky.

"Be prepared for the rules to be unfamiliar," Mobrem advised. "Don't get discouraged if it takes some time to adjust."

One difference between dog toys and high tech, he said, is "the etiquette of approaching potential investors. In most businesses, you can cold call investors, but that isn't how it works in tech, where you can't get a meeting without first being introduced through a mutual acquaintance."

Another big adjustment: Tech employees, of whom Lettuce now has 16. "You have to treat software developers like rock stars," he said.

Unlike the workers who filled orders at Dura Doggie, software engineers "expect a lot of praise and recognition for their work," he explained. "They're proud of what they do, and they need to know that you appreciate it."

Related: The danger when one client is 80% of sales

Lettuce isn't profitable yet, and Mobrem won't reveal the firm's revenues. Still, he said the potential market for inventory-management software is so big, he's glad they made the change.

"If you see a way to get into a business that could be even bigger and better than the one you have now, be realistic," he said. "Take emotion out of it, put your fears aside, and just look at the numbers."

If he'd done that when Lettuce's first app showed promise, he would have taken the plunge "five or six months sooner -- which, in the software world, is a long time." To top of page

First Published: January 29, 2014: 7:15 AM ET


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Ford workers to get record $8,800 profit share checks

Written By limadu on Selasa, 28 Januari 2014 | 21.29

ford assembly line workers

Ford said it will pay an average of $8,800 to about 47,000 hourly U.S. workers, up about $500 from last year.

NEW YORK (CNNMoney)

Ford (F, Fortune 500)said it will pay an average of $8,800 to about 47,000 hourly U.S. workers, up about $500 from last year.

The company agreed to more generous profit sharing in the most recent labor agreement; in return, veteran workers gave up an increase in their hourly pay rate. Ford also agreed to hire more workers and has increased the number of hourly workers by 6,000 over the last two years.

Ford plans to continue hiring workers in 2014, saying it will have its largest staffing increase in 50 years.

General Motors (GM, Fortune 500) and Chrysler Group, which both agreed to similar labor contracts two years ago, are also expected to report improved profit sharing payments in the coming week.

Ford's net profit for the quarter matched year-ago results. Its full-year net income was the strongest in more than a decade.

While full-year results improved in North America, fourth quarter earnings were down slightly. But losses in Europe narrowed, and Ford improved earnings in Asia. Revenue and vehicle sales increased worldwide and in North America for the quarter and the year.

Related: Ford unveils aluminum F-150

But Ford repeated its earlier guidance that profits will be lower in 2014 as it spends more on vehicle introductions.

Ford announced Tuesday that it will shut the plants that make its best-selling Ford F-150 pickup for 11 weeks later this year as it prepares for a radical change in the pickup's design, using far more aluminum. The company also said vehicle pricing is likely to be lower as it has to discount the current year models as it introduces a record number of new models this year. To top of page

First Published: January 28, 2014: 8:10 AM ET


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Home prices show signs of topping out

NEW YORK (CNNMoney)

The annual measure of home prices still increased 13.7% in November, but that was only narrowly better than the rise posted in October.

The housing recovery was one of the stronger aspects of the economy last year, boosting household wealth and home construction.

But with mortgage rates climbing steadily since hitting record lows in May, it's clear the housing recovery is starting to lose some steam.

"While housing will make further contributions to the economy in 2014, the pace of price gains is likely to slow during the year," said David Blitzer, chairman of the index committee at S&P Dow Jones Indices.

The Case-Shiller index chronicles prices across the nation's 20 largest metropolitan areas. Fourteen of those markets posted double-digit percentage gains over the last year, but only nine posted any month-over-month gain.

The improvement in housing was driven by pent-up demand for home purchases, combined with lower unemployment and a drop in foreclosures. Mortgage rates have been climbing steadily of late but remain low by historical standards, making housing prices far more affordable than they were at the height of the bubble last decade.

National prices are still nearly 20% below peak levels reached in mid-2006, according to Case-Shiller. To top of page

First Published: January 28, 2014: 9:15 AM ET


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Companies to pledge help for long-term jobless

lockheed martin

Lockheed Martin is among the companies that say they have signed on to best practices aimed at minimizing hiring discrimination against the jobless.

WASHINGTON (CNNMoney)

President Obama, in his State of the Union address Tuesday, is expected to announce the initiative, which will ask companies to sign on to "best practices" that will help minimize hiring discrimination against people who have been out of work for many months or longer.

Lockheed Martin, (LMT, Fortune 500) Xerox (XRX, Fortune 500), Deloitte and Siemens AG (SI) confirmed their pledges to CNNMoney. The White House didn't comment on the effort.

As the economy slowly recovers from the recession, the number of workers who have not found a job for at least six months or more has grown.

The causes of the long-term unemployment problem are complex, and discrimination hard to prove. But some researchers have found that discrimination plays a role. Some companies have even posted blatant job ads saying jobless need not apply.

Obama proposed in 2011 that Congress prohibit discrimination based on unemployment at companies with more than 15 workers. Bills were introduced in the Senate and House, but little progress was made.

Since then New Jersey, Oregon, the District of Columbia and New York City have all passed laws banning discrimination against the jobless.

The latest White House effort sidesteps gridlock in Congress, which has declined to extend federal benefits for millions of Americans losing extended unemployment insurance.

Life without benefits gets tougher for jobless

Labor experts and advocates for the unemployed question how enforceable or effective such a pledge would be.

"It's a great first step," said Maurice Emsellem, director of the Access and Opportunity Program at National Employment Law Project, which advocates for the unemployed. "It can't just be about voluntary compliance and fair standards. You have to go further than that."

-- CNN's Brianna Keilar contributed to this piece. To top of page

First Published: January 28, 2014: 9:19 AM ET


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India hikes rates amid market volatility

reserve bank of india

India's central bank raised a key interest rate to 8% Tuesday.

HONG KONG (CNNMoney)

The quarter-point rate increase was not expected by economists and comes amid an increasingly gloomy and volatile outlook for some emerging markets. It was the bank's third rate hike since September.

Citing economic uncertainty in China, Europe and Japan, the bank's governors said that financial market contagion "is a clear potential risk."

"Notwithstanding the boost from stronger external demand, uncertainty continues to surround the prospects for some emerging economies," the bank said in a statement.

The bank also said it did not expect further policy tightening, signaling that rates may now have reached their peak. Inflation is currently running at around 10% in the country.

"The RBI clearly wants to see inflation, particularly consumer price inflation, fall a good deal further," said Daniel Martin of Capital Economics.

Related story: India's finance minister says 8% growth is realistic

Emerging markets have been hammered in recent days on fears that a reduced flow of cheap money from the Federal Reserve will lead to a flight of cash from weaker economies. Signs of a slowdown in China's huge manufacturing sector and problems in its shadow banking system have only added to worries.

Related story: Turkey turmoil prompts central bank meeting

Developing markets got a major boost from of low interest rates in the United States, which encouraged a rush of capital into the developing world. Should rates rise and that trend reverse, vulnerable economies could take a hit as their currencies weaken and investors flee.

"The risk is there, but well managed emerging markets will be able to cope with it," Montek Singh Ahluwalia, deputy chairman of India's planning commission, said last week in Davos, Switzerland. To top of page

First Published: January 28, 2014: 4:51 AM ET


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China's $500 million shadow bank rescue

icbc china

China appears to have avoided a high-profile default that would have cost investors millions.

HONG KONG (CNNMoney)

That's the question being asked in China, where the murky rescue of a high-yield fund appears to have prevented a default that would have cost investors millions and undermined faith in the country's financial system.

But the 11th hour bailout by a mysterious third party has raised questions about China's readiness to let investors pay the price for failed investments and mounting risk in the country's shadow banking system.

Three years ago, a group of wealthy Chinese investors put 3 billion yuan ($500 million) into an investment trust -- the cheerfully named Credit Equals Gold #1 Collective Trust Product.

The product was marketed by Industrial and Commercial Bank of China, a state-owned enterprise that is one of the largest and most profitable banks in the world.

But the fund was designed and issued by China Credit Trust, one of the many shadow banks in China that offer loans to companies or individuals that may have trouble securing traditional bank financing.

In this case, the product was underpinned by a loan to a troubled mining operation in northern China that would later collapse as the price of coal plummeted. Investors were promised a juicy 10% annual return over three years, but were told earlier this month not to expect payment.

Related: Chinese experts play down shadow banking risk

Some of the investors, who reportedly put as much as $500,000 each into the fund, said ICBC should reimburse them since it had marketed the product.

ICBC insisted that it had never guaranteed the product, and had no legal responsibility to pay investors. The bank's chairman even went so far as to describe the episode as a learning opportunity for investors, shadow banks and ICBC.

State media reports suggest that opportunity has been missed, thanks to a bailout by an unnamed third party that ensures investors will recover their initial investment. Interest will not be paid.

Related story: China's richest man prefers U.K. deals over U.S.

A default could have prompted investors to pull their money from other trust products and stop providing the deposits needed to supply credit and fuel economic growth.

"A default would likely lead to a loss of confidence in China's trust and other shadow credit markets and a shrinkage of liquidity in those markets, and hence, a credit crunch," said UBS economist Tao Wang.

The bailout seems to have eliminated that risk. But some analysts argue that a default is needed to demonstrate Beijing's commitment to allow market forces to play a larger role in the economy, and to send a message to investors that high-yield investments carry significant risk.

"These bailouts further perpetuate the implicit government guarantee that investors have come to expect when they purchase financial products in China," wrote analysts at Bernstein Research.

Unless losses are allowed, investors will continue to pour money into unproductive projects, they added.

Related story: What's going on with China's latest credit crunch?

The rapid expansion of shadow banking has sparked worries in Beijing about the efficiency of the overall credit system, and some fear the $6.5 trillion sector has reached a scale where it could sap growth. Beijing has promised reforms, but some observers think the government is dodging the hard choices.

"[This] is just another example of China kicking the can down the road," the Bernstein analysts said. To top of page

First Published: January 28, 2014: 6:18 AM ET


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Stocks look to earnings, emerging markets

sp 500 futures 7

Click on chart to track premarkets

NEW YORK (CNNMoney)

U.S. stock futures were mixed ahead of the open, with the Nasdaq pointing down while the Dow Jones industrial average and S&P 500 were indicating a positive start to the day.

Earnings season is in full swing, with quarterly results expected before the opening bell from firms including Comcast (CCV), Ford (F, Fortune 500) and Pfizer (PFE, Fortune 500). After the close, expect to see results rolling in from Yahoo (YHOO, Fortune 500), AT&T (T, Fortune 500) and Electronic Arts (EA).

Apple (AAPL, Fortune 500) looks to be in for a rough trading session. Shares sank more than 7% in premarket trading after the firm's fourth quarter iPhone sales came in below expectations Monday.

DuPont (DCDDX) reported a jump in quarterly sales and operating earnings, propelled by insecticide sales in Latin America as well as earlier seed shipments. The company also announced a $5 billion share buyback.

Related: Fear & Greed Index swallowed by extreme fear

Emerging markets have returned center stage over the past few days as protests and wild currency fluctuations led to a sweeping sell-off.

Early Tuesday, Ukraine's prime minister offered to resign in a bid to ease a political crisis in his country.

Turkey's central bank is set to hold an emergency meeting Tuesday in an effort to halt the lira's steep decline. And India surprised investors with a rate hike to combat rising prices.

Related: Is this an emerging markets crisis?

The turmoil has been sparked, in part, by the U.S. Federal Reserve's plans to reign in the flow of cheap money. The markets expect the Fed to announce a further cut to its bond-buying program Wednesday, which could prompt a withdrawal of cash from vulnerable emerging markets.

"With all this [turmoil] in the background and ahead of tomorrow's Fed policy meeting in which most in the market now expect a further reduction of the bond-buying program by $10 billion, it's a no-brainer that asset allocators around the world are shedding their emerging market holdings," said Ishaq Siddiqi, a market strategist at ETX Capital in London.

Related: CNNMoney's Tech30

In economic news, the U.S. Census Bureau is set to release its monthly report on durable goods orders at 8:30 a.m. ET. The Case-Shiller 20-city home price index is due at 9:00, while the Conference Board's Consumer Confidence Index comes out at 10:00.

President Obama will give his annual State of the Union message at 9.00 p.m. ET.

European markets were edging higher in early trading while Asian markets ended mixed.

U.S. stocks fell Monday for a fifth consecutive day, continuing the slide from the previous week. To top of page

First Published: January 28, 2014: 5:02 AM ET


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Sony downgraded to 'junk'

Written By limadu on Senin, 27 Januari 2014 | 21.29

sony

Moody's is concerned that Sony will not be able to maintain the profitability levels it had experienced years ago.

LONDON (CNNMoney)

Shares in Sony (SNE) dipped by 3% in Japan as most Asian markets experienced significant losses Monday.

Moody's (MCO) explained that the Japanese company was facing extreme pressure in its TV and PC units, due to "intense global competition, rapid changes in technology, and product obsolescence."

Ultimately, Moody's concluded that it would be difficult for Sony to improve and stabilize its profitability.

"We expect the majority of [Sony's] core consumer electronics businesses -- such as TVs, mobile, digital cameras and personal computers -- to continue to face significant downward earnings pressure," Moody's wrote.

Sony released its Playstation 4 ahead of the Christmas period and recently announced it would introduce streaming games. While Moody's acknowledged that the successful launch of the Playstation 4 would help boost profitability, this wasn't enough to push profitability back to 2010 levels.

Related: Sony files patent for a "SmartWig"

Sony shares rose 57% in 2013 as the Japanese markets rallied, though investors acknowledge that the company faces many competitive pressures from the likes of Microsoft (MSFT, Fortune 500) and Apple (AAPL, Fortune 500).

The downgrade comes in the same month that Nintendo (NTDOF) warned investors that it was expecting an operating loss of 35 billion yen ($335.2 million) for the fiscal year ending in March, following disappointing software and hardware sales in the busy end-of-year buying season. To top of page

First Published: January 27, 2014: 7:01 AM ET


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FAA orders inspections of Boeing 767s

NEW YORK (CNNMoney)

The problem being cited is something that the FAA and Boeing have been looking into since 2000, and the planes have already been subject to earlier inspections.

But the FAA, in a notice in the Federal Register on Monday, said it has determined that potential problems with rivets could cause "failures or jams" that affect the plane's ability to climb or descend. The failure could result in "possible loss of control of the airplane," the FAA said.

The problem has not been cited as a cause in any crash of a 767, which is one of the most widely-used Boeing jets. Boeing has delivered 1,061 of the long-range, widebody planes since it went into service in 1982.

Related: Airbus calls for wider seats on long flights

Some of the airlines objected to the proposed FAA action. United Continental (UAL, Fortune 500) filed comments arguing that previous inspections ordered by the FAA, along with service bulletins from Boeing, have addressed the risks being cited by the FAA in its new order. But the FAA rejected that argument.

Boeing (BA, Fortune 500) spokespeople were not immediately available for comment Monday. The order takes effect March 3, and airlines must perform the inspections within 6,000 flight hours of that date for each aircraft. To top of page

First Published: January 27, 2014: 7:35 AM ET


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2015 Honda Fit: The secret star of the Detroit auto show

2015 honda fit

The 2015 Honda Fit

(Fortune)

As for the Fit, it is a four-door subcompact hatchback in a market that reserves its enthusiasm for big displacement engines and sport coupe styling. Americans bought only 53,513 in 2013 (Ford (F, Fortune 500) sold more than 763,000 F-series trucks during the same time), making the Fit little more than a niche model in a small and profit-challenged segment.

But competitors take note. Overlooking the new Fit will be a big mistake. Consider:

• In a remarkable achievement in packaging, the 2015 Fit is smaller on the outside but significantly larger on the inside. Offering the interior room of a compact-size car in a subcompact body will boost Honda's fuel economy and give it a leg up in the mileage wars.

• The Fit represents a spirited return by Honda to its sporty small car roots with edgier styling, peppier powertrains, and greater functionality. It is the first tangible evidence that the Japanese manufacturer has shucked off its recession-driven, cheap-and-cheerful mindset and recaptured the energy that has made it the U.S.'s fourth bestselling brand.

• When Honda starts producing the Fit in North America later this year, it will nearly quadruple the supply of available vehicles, making Fit the spearhead of Honda's drive to boost U.S. sales.

Too much corporate and reputational baggage to pile on to a tiny car? Not at all.

The new Fit is faster, smarter, and thriftier. With its new 1.5-liter engine, the Fit will generate 130 horsepower, an increase of 13 hp over the engine of the 2014 car, while reducing weight and improving efficiency.

MORE: 14 auto predictions for 2014

The combination of the new powertrain with a new chassis is expected to enable the Fit to have class-leading EPA-estimated fuel economy ratings of up to 36 miles per gallon combined -- 33 mpg city and 41 mpg highway. That will get Honda far down the road toward meeting 2025 CAFE standards that dictate a stiff 54.5 mpg fleet average

Electronics play a leading role in the new Fit: Bluetooth provides smartphone connectivity, a multi-view rear camera improves visibility, and a blind-spot camera is available, along with keyless entry and start -- all this in a car that will likely have a starting price around $16,000.

Best of all, in a feat akin to stuffing dozens of circus clowns into a Volkswagen Beetle, Honda has shrunk the overall length of the 2015 Fit by 1.6 inches and at the same time created more space inside. Even though its width is up by a scant 0.3 inches, and its height remains unchanged at 60 inches, the Fit's rear-seat legroom has been increased by nearly five inches, and overall passenger volume has gained 5%.

The extra room comes partly from stretching the wheelbase by 1.2 inches and stealing some space from the cargo area, but otherwise Honda engineers have been closemouthed about how else they got there. All they acknowledge at this point, according to published sources, is a 57-pound reduction in the weight of the basic floor pan attributable to more extensive use of high-strength steel. The improved structural stiffness should benefit both ride and handling.

In the race for greater fuel economy, boosting the usable interior space while making the car smaller overall is like drawing to an inside straight in Texas hold 'em. As traffic tightens and electronics connect more cars, drivers will spend more time behind the wheel, making the quality of their accommodations more important.

MORE: The next thin slice of luxury from Ford

Safety is an issue too, and Honda engineers claim to have improved the dismal performance of the second-generation Fit in crash tests performed by the Insurance Institute for Highway Safety. The 2013 Fit was the only vehicle that ranked "poor" in both categories of lower-body injuries, prompting Consumer Reports to yank its "recommended" rating. Honda says the 2015 car will attain a "good" rating for all IIHS test modes.

The Fit is that rare automobile whose U.S. sales potential is untested. The car has been made in Japan since it was launched in 2001 (it came to the U.S. in 2006), and production limits have caused its U.S sales to be rationed. That will change in February when Honda starts up operations at a new plant in Celaya, Mexico for the U.S. market. The additional capacity comes just in time. The new Fit became the bestselling car in Japan during its first full month on sale, beating out the Toyota Prius (TM).

Once it is running at full capacity, the Mexico plant will be capable of building 200,000 Fits and a Fit-based crossover annually. Their success in the showroom will be key to Honda reaching its goal of selling 1.8 million to 2 million cars, crossovers, and SUVs in the U.S. by 2017. Right now, that target looks far away. In 2013, Honda-brand sales amounted to just 1.36 million units. But Honda's ability to move the metal should not be underestimated. It isn't widely appreciated, but of the seven bestselling passenger vehicles in the U.S. last year, three are made by Honda: the Accord, Civic, and CR-V crossover. The new Fit will find itself in rarefied company. To top of page

First Published: January 27, 2014: 7:14 AM ET


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Sony downgraded to 'junk'

sony

Moody's is concerned that Sony will not be able to maintain the profitability levels it had experienced years ago.

LONDON (CNNMoney)

Shares in Sony (SNE) dipped by 3% in Japan as most Asian markets experienced significant losses Monday.

Moody's (MCO) explained that the Japanese company was facing extreme pressure in its TV and PC units, due to "intense global competition, rapid changes in technology, and product obsolescence."

Ultimately, Moody's concluded that it would be difficult for Sony to improve and stabilize its profitability.

"We expect the majority of [Sony's] core consumer electronics businesses -- such as TVs, mobile, digital cameras and personal computers -- to continue to face significant downward earnings pressure," Moody's wrote.

Sony released its Playstation 4 ahead of the Christmas period and recently announced it would introduce streaming games. While Moody's acknowledged that the successful launch of the Playstation 4 would help boost profitability, this wasn't enough to push profitability back to 2010 levels.

Related: Sony files patent for a "SmartWig"

Sony shares rose 57% in 2013 as the Japanese markets rallied, though investors acknowledge that the company faces many competitive pressures from the likes of Microsoft (MSFT, Fortune 500) and Apple (AAPL, Fortune 500).

The downgrade comes in the same month that Nintendo (NTDOF) warned investors that it was expecting an operating loss of 35 billion yen ($335.2 million) for the fiscal year ending in March, following disappointing software and hardware sales in the busy end-of-year buying season. To top of page

First Published: January 27, 2014: 7:01 AM ET


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Stocks: Set for a positive start

20130127 premarkets

Click chart for in-depth premarket data.

NEW YORK (CNNMoney)

U.S. stock futures moved higher, with the S&P 500 rising 0.2% ahead of the open. Global markets remained under pressure.

Last week was a rough week for U.S. stocks. The Dow Jones industrial average shed around 2% on Friday, to end the week down 3.5%. The Nasdaq and S&P 500 both closed down over 2% on Friday, and posted losses for the week.

Related: Fear & Greed Index

Shares in Google (GOOG, Fortune 500) were little changed Monday morning after the company announced it acquired London-based artificial intelligence firm DeepMind Technologies. It's the latest in a series of start-up purchases by the tech giant as it looks to beef up its expertise in artificial intelligence and robotics.

Sony (SNE) shares lost 2.3% in premarket trading after the firm's debt rating was downgraded to 'junk' status by Moody's, with the agency warning that profitability at the tech company would likely remain weak and volatile.

Related: Emerging markets rattled as anxiety rises

Emerging markets extended recent losses on Monday amid worries about an economic slowdown and liquidity shortfalls.

European stocks fell in morning trading, with London FTSE 100 index losing 1%.

Shares in Vodafone (VOD) tumbled 5% in London after AT&T (T, Fortune 500) said Monday it would not purchase the British telecom company. There had been recent speculation that a bid was imminent.

British oil and gas firm BG Group was another weak spot, with shares plunging 15% after the company warned investors that it faces challenging business conditions.

Related: Tata Motors exec dead after Bangkok hotel fall

Asian markets ended in the red. The biggest loser was Japan's Nikkei index, which closed down 2.5%. To top of page

First Published: January 27, 2014: 5:55 AM ET


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2015 Honda Fit: The secret star of the Detroit auto show

2015 honda fit

The 2015 Honda Fit

NEW YORK (Fortune)

As for the Fit, it is a four-door subcompact hatchback in a market that reserves its enthusiasm for big displacement engines and sport coupe styling. Americans bought only 53,513 in 2013 (Ford (F, Fortune 500) sold more than 763,000 F-series trucks during the same time), making the Fit little more than a niche model in a small and profit-challenged segment.

But competitors take note. Overlooking the new Fit will be a big mistake. Consider:

• In a remarkable achievement in packaging, the 2015 Fit is smaller on the outside but significantly larger on the inside. Offering the interior room of a compact-size car in a subcompact body will boost Honda's fuel economy and give it a leg up in the mileage wars.

• The Fit represents a spirited return by Honda to its sporty small car roots with edgier styling, peppier powertrains, and greater functionality. It is the first tangible evidence that the Japanese manufacturer has shucked off its recession-driven, cheap and cheerful mindset and recaptured the energy that has made it the U.S.'s fourth bestselling brand.

• When Honda starts producing the Fit in North America later this year, it will nearly quadruple the supply of available vehicles, making Fit the spearhead of Honda's drive to boost U.S. sales.

Too much corporate and reputational baggage to pile on to a tiny car? Not at all.

The new Fit is faster, smarter, and thriftier. With its new 1.5-liter engine, the Fit will generate 130 horsepower, an increase of 13 hp over the engine of the 2014 car, while reducing weight and improving efficiency.

MORE: 14 auto predictions for 2014

The combination of the new powertrain with a new chassis is expected to enable the Fit to have class-leading EPA-estimated fuel economy ratings of up to 36 miles per gallon combined -- 33 mpg city and 41 mpg highway. That will get Honda far down the road toward meeting 2025 CAFE standards that dictate a stiff 54.5 mpg fleet average

Electronics play a leading role in the new Fit: Bluetooth provides smartphone connectivity, a multi-view rear camera improves visibility, and a blind spot camera is available, along with keyless entry and start -- all this in a car that will likely have a starting price around $16,000.

Best of all, in a feat akin to stuffing dozens of circus clowns into a Volkswagen Beetle, Honda has shrunk the overall length of the 2015 Fit by 1.6 inches and at the same time created more space inside. Even though its width is up by a scant 0.3 inches, and its height remains unchanged at 60 inches, the Fit's rear-seat legroom has been increased by nearly five inches, and overall passenger volume has gained 5%.

The extra room comes partly from stretching the wheelbase by 1.2 inches and stealing some space from the cargo area, but otherwise Honda engineers have been closemouthed about how else they got there. All they acknowledge at this point, according to published sources, is a 57-pound reduction in the weight of the basic floor pan attributable to more extensive use of high-strength steel. The improved structural stiffness should benefit both ride and handling.

In the race for greater fuel economy, boosting the usable interior space while making the car smaller overall is like drawing to an inside straight in Texas hold 'em. As traffic tightens and electronics connect more cars, drivers will spend more time behind the wheel, making the quality of their accommodations more important.

MORE: The next thin slice of luxury from Ford

Safety is an issue too, and Honda engineers claim to have improved the dismal performance of the second-generation Fit in crash tests performed by the Insurance Institute for Highway Safety. The 2013 Fit was the only vehicle that ranked "poor" in both categories of lower-body injuries, prompting Consumer Reports to yank its "recommended" rating. Honda says the 2015 car will attain a "good" rating for all IIHS test modes.

The Fit is that rare automobile whose U.S. sales potential is untested. The car has been made in Japan since it was launched in 2001 (it came to the U.S. in 2006), and production limits have caused its U.S sales to be rationed. That will change in February when Honda starts up operations at a new plant in Celaya, Mexico for the U.S. market. The additional capacity comes just in time. The new Fit became the best-selling car in Japan during its first full month on sale, beating out the Toyota Prius (TM).

Once it is running at full capacity, the Mexico plant will be capable of building 200,000 Fits and a Fit-based crossover annually. Their success in the showroom will be key to Honda reaching its goal of selling 1.8 million to 2 million cars, crossovers, and SUVs in the U.S. by 2017. Right now, that target looks far away. In 2013, Honda-brand sales amounted to just 1.36 million units. But Honda's ability to move the metal should not be underestimated. It isn't widely appreciated, but of the seven bestselling passenger vehicles in the U.S. last year, three are made by Honda: the Accord, Civic, and CR-V crossover. The new Fit will find itself in rarefied company. To top of page

First Published: January 27, 2014: 7:14 AM ET


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Michaels stores: Possible data 'attack'

Written By limadu on Minggu, 26 Januari 2014 | 21.29

michaels craft store hacked

The country's largest crafts chain said Saturday it learned recently of 'possible fraudulent activity' on some customer payment cards, suggesting there may have been a breach.

NEW YORK (CNNMoney)

Michaels said Saturday that it learned recently of "possible fraudulent activity" on some of its customers' payment cards, suggesting there may have been a breach.

CEO Chuck Rubin said the company has not confirmed a breach, but wanted to alert customers.

"We are concerned there may have been a data security attack on Michaels that may have affected our customers' payment card information and we are taking aggressive action to determine the nature and scope of the issue," Rubin said in a statement.

The company gave no additional information on the possible breach, including how many customers may be involved, when those customers shopped at Michaels, and if the possible breach affected online or in-store shoppers.

In recent weeks Target (TGT, Fortune 500) and Neiman Marcus have each acknowledged breaches.

The attack on Target affected as many as 110 million customers, including 40 million credit and debit card shoppers at the height of the holiday shopping season.

Neiman Marcus said a three-month breach in the summer and fall affected 1.1 million customers.

Michaels says it operates more than 1,100 stores in the U.S. and Canada. To top of page

First Published: January 25, 2014: 2:42 PM ET


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Buckle up! 2014 will be a bumpy ride

davos laurence fink

BlackRock CEO Laurence Fink: "I hear way too much optimism going forward -- we're going to be in a world of much greater volatility."

Davos, Switzerland (CNNMoney)

Financial experts at the World Economic Forum in Davos were cautiously optimistic about the outlook for growth in 2014, but the beginning of the end of post-crisis emergency financial support will be bumpy.

The Dow just had its worst week since 2011. And emerging market currencies got hit hard as investors fled riskier assets.

Investors were troubled by signs of weakness in China's huge manufacturing sector and a looming default in the shadow banking system. Expectations that the Federal Reserve will continue to pull back monetary stimulus pushed things along.

"I hear way too much optimism going forward -- we're going to be in a world of much greater volatility," said BlackRock CEO Laurence Fink.

Related: Cry for me Argentina? Peso plunges

Investors had been encouraged by "good, consistent" central bank policy around the world in recent years, he said. But the next impetus for growth would depend on governments in China, Japan, the U.S. and Europe delivering on promised economic reforms.

"That troubles me, because there has been great consistency of governments dragging their feet," Fink said.

Monetary policy is already beginning to change in the U.S. and U.K., in response to stronger growth and falling unemployment.

The Federal Reserve has begun to "taper" its purchases of government bonds, and some analysts predict the Bank of England will raise interest rates as early as the fourth quarter.

Bank of England Governor Mark Carney said there was "no immediate need" for an increase in the cost of borrowing, and that when it comes, the process will be gradual.

But the return to more normal levels of market volatility would feel worse than it is, coming after an extended period of calm, he said.

Related: India headed for 8% growth

The International Monetary Fund upgraded its forecast for world growth on Tuesday. It warned that the outlook would depend on the impact of the withdrawal of central bank support.

"This is clearly a new risk on the horizon, and it needs to be watched," IMF Managing Director Christine Lagarde said.

The flow of money back to the U.S. and other developed economies would not affect emerging markets uniformly, she added. Investors would differentiate based on political stability, commitment to reform, and signs of financial weakness.

"The risk is there, but well managed emerging markets will be able to cope with it," said Montek Ahluwalia, deputy chairman of India's planning commission.

Fink said too much attention was paid to the actions of the Fed and other central banks, and not enough to the reforms needed to respond to the massive technological changes that are destroying jobs. To top of page

First Published: January 25, 2014: 11:22 AM ET


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Weather Channel-DirecTV blackout: No end in sight

directv weather channel

TV channel owners and distributors usually haggle in private. But the dispute between the Weather Channel and DirecTV underscores how contentious the negotiations can become.

NEW YORK (CNNMoney)

On Friday, DirecTV Chief Executive Mike White published a letter online blasting television channels for acting like "it's their absolute birthright to be paid more and more each year for the same content they offer, regardless of how many customers actually watch their channels."

White didn't stop there. He asserted that the Weather Channel's total audience has been declining as consumers gravitate to the Web.

"Why should DirecTV customers pay more for a channel they are watching far less?" he wrote.

White's letter was unusual. Television channel owners and distributors usually haggle in private and come up with carriage agreements that both sides can live with.

The dispute between the Weather Channel and DirecTV underscores how contentious the negotiations can become.

Related: Cable TV competition from the Web

White asserted in his letter that DirecTV believes the channel is only worth "one-quarter" of the price the channel wants.

According to research firm SNL Kagan, the Weather Channel earns about 13 cents per television subscriber per month. During the dispute, the channel has said that it's asking for a penny more, while DirecTV is asking it to accept a 20% reduction, or roughly 10 cents per subscriber per month.

The more drastic reduction that White described in his letter is basically unheard of in the television business.

But White's stated logic may appeal to many of his customers: "In every other industry, when the demand for any product is reduced, prices go down, they don't go up. That is the heart of this issue."

In response, Weather Channel spokeswoman Shirley Powell said that DirecTV's decision to drop the channel "has nothing to do with keeping costs down for consumers." She noted that DirecTV recently said it would raise its prices by 4.4% on average.

Related: Verizon bets on future of TV

For his part, White conceded that DirecTV was raising its prices along with other TV providers like Comcast, Dish and Time Warner Cable. But he blamed the content providers.

"[W]e are forced to raise our prices annually due to programmers like the Weather Channel, demanding to be paid more and more each year," he wrote. He said DirecTV "will be forced" to pay 8% more for programming in 2014 and that it was passing on to its customers only a 3.7% increase.

White's letter sent a message to DirecTV customers: Don't switch to another provider, because channels like the Weather Channel are forcing them to raise rates, too.

DirecTV provides television service to about 20 million homes, totaling roughly one in six households in the United States. Before the dispute with the Weather Channel, DirecTV introduced an upstart channel, WeatherNation, as an alternative.

White admitted in Friday's letter that WeatherNation is not an "exact substitute" -- far from it -- but said it "offers our customers what they want at a fraction of the price."

One of White's main points is the same one that outside analysts have pushed: The television version of the Weather Channel is being cannibalized by the parent company's Web sites and apps. The channel's Weather.com is one of the preeminent sources for online weather information.

"Our customers tell us the Weather Channel is their fourth choice when looking to access weather information," White said. "They first turn to mobile devices and computers for instant weather information and then to local news sources that have a better grasp on local conditions."

Last week, on CNN's "Reliable Sources," I asked Weather Channel meteorologist Jim Cantore if the channel's apps were pulling people away from TV.

"Here's my analogy," he said. "If your knee is starting to ail a little bit, you may go online and see what the symptoms may be. But at the end of the day, you're going to the doctor to find out what's going on with that." The flagship television channel, he said, is the doctor.

But the back-and-forth between the Weather Channel and DirecTV suggests that DirecTV subscribers won't be seeing that doctor anytime soon. To top of page

First Published: January 25, 2014: 7:31 PM ET


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Michaels stores: Possible data 'attack'

michaels craft store hacked

The country's largest crafts chain said Saturday it learned recently of 'possible fraudulent activity' on some customer payment cards, suggesting there may have been a breach.

NEW YORK (CNNMoney)

Michaels said Saturday that it learned recently of "possible fraudulent activity" on some of its customers' payment cards, suggesting there may have been a breach.

CEO Chuck Rubin said the company has not confirmed a breach, but wanted to alert customers.

"We are concerned there may have been a data security attack on Michaels that may have affected our customers' payment card information and we are taking aggressive action to determine the nature and scope of the issue," Rubin said in a statement.

The company gave no additional information on the possible breach, including how many customers may be involved, when those customers shopped at Michaels, and if the possible breach affected online or in-store shoppers.

In recent weeks Target (TGT, Fortune 500) and Neiman Marcus have each acknowledged breaches.

The attack on Target affected as many as 110 million customers, including 40 million credit and debit card shoppers at the height of the holiday shopping season.

Neiman Marcus said a three-month breach in the summer and fall affected 1.1 million customers.

Michaels says it operates more than 1,100 stores in the U.S. and Canada. To top of page

First Published: January 25, 2014: 2:42 PM ET


19.33 | 0 komentar | Read More

Buckle up! 2014 will be a bumpy ride

davos laurence fink

BlackRock CEO Laurence Fink: "I hear way too much optimism going forward -- we're going to be in a world of much greater volatility."

Davos, Switzerland (CNNMoney)

Financial experts at the World Economic Forum in Davos were cautiously optimistic about the outlook for growth in 2014, but the beginning of the end of post-crisis emergency financial support will be bumpy.

The Dow just had its worst week since 2011. And emerging market currencies got hit hard as investors fled riskier assets.

Investors were troubled by signs of weakness in China's huge manufacturing sector and a looming default in the shadow banking system. Expectations that the Federal Reserve will continue to pull back monetary stimulus pushed things along.

"I hear way too much optimism going forward -- we're going to be in a world of much greater volatility," said BlackRock CEO Laurence Fink.

Related: Cry for me Argentina? Peso plunges

Investors had been encouraged by "good, consistent" central bank policy around the world in recent years, he said. But the next impetus for growth would depend on governments in China, Japan, the U.S. and Europe delivering on promised economic reforms.

"That troubles me, because there has been great consistency of governments dragging their feet," Fink said.

Monetary policy is already beginning to change in the U.S. and U.K., in response to stronger growth and falling unemployment.

The Federal Reserve has begun to "taper" its purchases of government bonds, and some analysts predict the Bank of England will raise interest rates as early as the fourth quarter.

Bank of England Governor Mark Carney said there was "no immediate need" for an increase in the cost of borrowing, and that when it comes, the process will be gradual.

But the return to more normal levels of market volatility would feel worse than it is, coming after an extended period of calm, he said.

Related: India headed for 8% growth

The International Monetary Fund upgraded its forecast for world growth on Tuesday. It warned that the outlook would depend on the impact of the withdrawal of central bank support.

"This is clearly a new risk on the horizon, and it needs to be watched," IMF Managing Director Christine Lagarde said.

The flow of money back to the U.S. and other developed economies would not affect emerging markets uniformly, she added. Investors would differentiate based on political stability, commitment to reform, and signs of financial weakness.

"The risk is there, but well managed emerging markets will be able to cope with it," said Montek Ahluwalia, deputy chairman of India's planning commission.

Fink said too much attention was paid to the actions of the Fed and other central banks, and not enough to the reforms needed to respond to the massive technological changes that are destroying jobs. To top of page

First Published: January 25, 2014: 11:22 AM ET


19.33 | 0 komentar | Read More
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