December 15, 2006

Weblog Awards: The Final HOURS (121506)

Filed under: General,News from Other Sites — Tom @ 5:20 pm

Voting ends tonight at 11:59 PM ET. Vote for BizzyBlog here. You have one more chance to vote. If you’re new here and in evaluation mode, see the biz/econ-related posts in the “Top 20″ near this page’s top right. Also, vote for Viking Spirit, Right Angle Blog, Pundit Review, Hot Air, Brussels Journal, Willisms, Sean Gleeson.

Race Report: My competitor for 4th place is up by about 20 votes as of 5:30 PM.

Business Question: Will Old Media Change, or Go Under?

ANSWER: Indications are ….. they’re volunteering to do the latter.

_______________________________

More time and energy has been spent on the business side of the print, radio, and TV media since I started BizzyBlog than I ever expected.

My intent was initially to focus on errors, omission, and bias in specific reports on and opinions about current economic events, and plenty of that has taken place.

I did not anticipate covering the implosion of Old Media as a story unto itself, but it has been impossble not to. That’s because even when it has become clear that out-of-balance, out-of-touch, and intractably-biased newsrooms have been the primary contributors to declining circulations, falling viewership, and in-the-tank stock prices, Old Media has responded by laying people off, and changing almost nothing else. It’s as if they would rather die than change how they do business. It seems to me to be almost unprecedented in the annals of business for virtually an entire industry to take on such a mindset.

The litany of the staggering seems endless. Just off the top of my head, there’s NBC/MSNBC, the LA Times (layoffs at least twice), the Washington Post (layoffs at least twice), the New York Times (share price down over 50% in 3 years), Knight Ridder Newspapers (ultimately sold), almost every major paper in Ohio, etc., etc. Yet no one seems to ask if there is anything out of whack about the news product or a serious disconnect from the audience. They slough it off on the Internet (which, though relevant, cannot possibly fully explain the steep circulation declines that are occurring), and move on with the same old slanted news coverage as if nothing happened.

The latest example of “we don’t need to change” comes from hiatused Black Swamp Conservative Chad Baus of the Buckeye Firearms Association. Read the whole exchange of e-mails. There is a relationship between an organization that won’t acknowledge an obvious mistake, even when caught red-handed, or the need to change, and this. And so, it will continue.

In the midst of a generally strong economy, the decline of Old Media is second only to that of the comeuppance occurring at Detroit’s traditional Big Three as the industry implosion story of the past 5 years. That’s why it has gotten the attention it has here, and will continue to.

Dvorak Thinks Microsoft Will STILL Be the Next ‘Big Tobacco’

John Dvorak thinks a case that is essentially the State of Iowa suing The Evil Empire for $330 mil is the first of many, and that they will succeed:

This began when some sharp lawyers in Des Moines dug through all the old antitrust documents and found even more crazy notes and memos from all sorts of important insiders. This includes memos that hint at anticonsumer behavior. The latest update to the case sent out by the PR machine promoting this lawsuit is here and definitely worth reading if you have the time.

I have mixed feelings about this lawsuit. If successful, it’s going to lead to more and more copycat lawsuits against Microsoft in an attempt to bleed the company dry. My advice to the company: Get that cash out of the bank immediately! Spend it or give it to shareholders before you lose it to these folks.

The danger for Microsoft is that with each new set of attorneys in each state (the ones that didn’t get a piece of the original federal antitrust suit), you’ll see newer and more creative concepts developed for the court to hear. In the Iowa case they are promoting something called ABTE—”applications barrier to entry.” This is exemplified by the practice of cutting products out of the loop in various ways and focusing on applications that run only on Microsoft products—a Web page that opens only under Internet Explorer, for example, or a media file that can be played only by a Microsoft player. It doesn’t take much research to find Web sites that were created by Microsoft to this day that won’t run properly under Firefox.

If the ABTE concept flies, then Microsoft is toast in one state after another as long as any sort of consumer-protection laws lurk on the books someplace. The smart state attorney generals are watching the Iowa case while scouring the books for some way to get on this potential gravy train. I mean, let’s face it, there are a lot of laws that nobody pays much attention to that are still there waiting for the unwary.

The worst part about this is that Microsoft will have a very difficult time beating these cases, since each one will be more fine-tuned than the next.

….. I don’t see how the company is going to get out from under these suits. First, the suits will come from state after state. Then certain cities will find a way to soak the company. Microsoft will fight the first few, but then a cookie-cutter template and precedents will emerge, making each case easier than the next. Then Microsoft will get out the checkbook, and it will become a money-grab.

This is ridiculous. I hope Dvorak’s wrong.

No one would ever confuse me for a Microsoft cheerleader, but if he’s right, the states and the private law firms representing them will pocket hundreds of millions, if not billions. If form holds, the average “deceived” consumer will get, oh, I don’t know, maybe a $100 discount on their next Vista or Office purchase. Big whoop. Or, as was the case with tobacco, the winning state(s) will convince the courts that they should handle the settlement money instead of their supposedly aggrieved citizens. That would be just another way to get what is in effect a tax increase levied on a single company.

To what possible constructive end?

Rules of the Game Report: Oil Royalties

Filed under: Business Moves,Economy,Taxes & Government — Tom @ 11:39 am

If this is true (free registration may be required), the Uncle Sam’s enforcers need to let it rip:

Report Says Oil Royalties Go Unpaid

An eight-month investigation by the Interior Department’s chief watchdog has found pervasive problems in the government’s program for ensuring that companies pay the royalties they owe on billions of dollars of oil and gas pumped on federal land and in coastal waters.

In a scathing report to Congress, the Interior Department’s inspector general says the agency’s data are often inaccurate, that its officials rely too heavily on statements by oil companies rather than actual records and that only about 9 percent of all oil and gas leases are being reviewed.

The report undermines claims by top Interior officials that the department is aggressively pursuing underpayments and outright cheating by companies that drill on property owned by the American public.

The Times’ distortions during the aftermath of the Sago Mine deaths in January and the Times’ total misread, and refusal to let go, of the personnel reductions in the death-tax auditing area at the IRS are enough to make one skeptical that things are as bad as portrayed in this instance.
But if true, aggressively pursuing collection of what the government is legally owed would be a totally proper way to “extract” money from oil companies. Maybe then Congress could lay off the punitive and economy-hurting “windfall profits” baloney.

The Problem Is in the Tubes

Filed under: General — Tom @ 11:04 am

….. at least from my desk through the tubes to my web host, occurring somewhere in the Internet backbone. Access is very spotty. It may be happening from where you are too. Level 3 has been advised.

Assuming this min-post even gets through, this is to let you know that from this point I won’t be looking at much of anything on the site until this evening. Several posts are already scheduled, so new stuff will still appear throughout the day. Hopefully response will improve in the meantime.

Imamagine That: An Elaborate, and Dangerous, Orchestration

Katherine Kersten, of the official “mainstream source” Minneapolis Star-Tribune, has done the most important part of the dot-connecting process relating to the six imams incident at Minneapolis-St. Paul Airport in November — from the Muslim extremists in the Middle East, to Congressmen Keith Ellison and John Conyers, to Conyers’ End of Racial Profiling Act (with a serving of stepped-up civil litigation on the side), to increasing the likelihood that a future aviation-based terror attempt will be “successful” (column here; blogpost with comments here; bolds are mine):

On Dec. 1, a curious report on the grounded-imams incident at the Minneapolis-St. Paul International Airport appeared on the website of the Iranian Quran News Agency. The report quoted extensively from Madhi Bray, executive director of the Muslim American Society Freedom Foundation. The foundation is the American arm of the Muslim Brotherhood, “the world’s most influential Islamic fundamentalist group,” according to the Chicago Tribune.

Bray’s initial statement about the incident had an all-American, see-you-in-court ring. He demanded “large financial compensation for the imams,” adding, “We want US Airways and any other airline displaying this type of behavior against Muslims to be hit where it hurts, the pocketbook.”

….. But the report on the Iranian website, which has appeared on a variety of Muslim websites worldwide, had a larger primary focus. After the imams incident, it quoted Bray as saying Muslims want “new, broad-sweeping legislation that will extract even larger financial and civil penalties for any airline that participates in racial and religious profiling.”

….. One piece of legislation in the works is the End Racial Profiling Act.

….. The act, although it doesn’t as yet impose large penalties, would bar any federal, state or local law enforcement agency from “relying, to any degree, on race, ethnicity, national origin, or religion in selecting which individuals to subject to routine or spontaneous investigatory activities.” That would include questioning, searches and seizures.

One of the act’s central features is its definition of illegal profiling. Under it, if airport security personnel question passengers who are disproportionately Muslim or of Middle Eastern descent, this alone would constitute a presumptive violation of the law. Law enforcement agencies would bear the burden of proving that discrimination was not the cause.

What would the effect of such a law be?

“A law that would compel security professionals to focus on keeping their statistics within certain norms rather than on their mission keeping airline travel safe would have a devastating effect on our ability to ensure airline safety,” said Daniel Horan of the Los Angeles Police Department in an interview.

The End of Racial Profiling Act has languished until now. What did it need to reinvigorate it? New congressional leadership, and that’s coming in January. But it needed something else in this media age: a high-profile incident to jump-start it.

What better than the media circus at the Minneapolis-St. Paul International Airport on Nov. 20?

The End of Racial Profiling Act changes the calculus totally. Passenger safety moves to a distant third place on the priority list, behind:

  • Not investigating anyone who might be suspicious if the balance of investigations done previously will tilt in the “wrong” direction (i.e, not letting law-enforcement and homeland security people do their jobs).
  • Not offending anyone, especially of “Muslim or Middle Eastern descent.”

If such a bill passed, it would make hijacking and/or commandeering a plane by those who fit the profile of those who have done so in the past much easier. It’s as if September 11, 2001 never happened. Political correctness would trump safety, even survival — all brought to you by a lazy media that with the sole exceptions of Kersten and The Washington Times (which the elitists claim doesn’t count anyway), has refused to follow up meaningfully on new information relevant to the imams story after the initial incident.

Not as important but still very relevant — Anyone in the traveling public who becomes convinced that airport security has been handcuffed will choose to drive to their destinations when possible, and fly less often, if at all. Enough of that, and airlines start going out of business.

All of this is why folks like Richard Miniter, Debra Burlingame, and several center-right bloggers have felt the need to step into the breach. If the beat reporters were doing their jobs, none of the others’ work would have been necessary.

Barack Obama — He’s All Ears; Maureen Dowd Questions Whether He’s All Man

Filed under: MSM Biz/Other Bias,Taxes & Government — Tom @ 7:34 am

Note: Links in this post were updated in January 2008 to articles at the New York Times that became available when the newspaper took down its TimeSelect firewall in late 2007.

______________________________________________

In the third-last paragraph of her October 21, 2006 “Obama’s Project Runway” column (the one that, luckily for Barack Obama, almost no one outside of Manhattan reads), the New York Times’ Maureen Dowd wrote this about Barack Obama:

He’s intriguingly imperfect: His ears stick out, he smokes, and he’s written about wrestling with pot, booze and ”maybe a little blow” as a young man.

On Sunday, December 10, roughly 50 days later, noted in a column by Lynn Sweet of the Chicago Sun-Times, Obama took on Dowd over arguably the least relevant item in that sentence:

Obama is very sensitive about his press. After his press conference, he headed toward New York Times columnist Maureen Dowd and chided her — in a kidding way — for a comment in the 12th of 14 paragraphs in an Oct. 21 column. She wrote that Obama’s “ears stick out.”

“I just want to put you on notice,” he said.

“I was teased relentlessly when I was a kid about my big ears.”

Wow — 50 days later, the guy was still stewing over four words about his ears.

(Note: There appears to be a bit of debate over whether Obama was serious. Sweet obviously says “kidding” above. This commenter, and especially this one, at Lynn Sweet’s Sun-Times blog surely believe Obama was serious, as does Rush. Allah thinks he was kidding. I’ve heard it several times; I do NOT believe Obama was kidding [see more on his tone of voice later], and you don’t “put someone on notice” unless you’re serious.)

Rush played audio on Wednesday of the entire exchange (this may or may not work by the time you read this; it will probably load in your browser if it works) in a much longer show segment, and here’s the relevant portion (about 60% of the way through):

OBAMA (off mic): You talked about my ears, and I just want to put you on notice: I’m very sensitive about — What I told them was, ”I was teased relentlessly when I was a kid about my big ears.”

DOWD: We’re trying to toughen you up.

Put aside for the moment that Dowd would never cut a conservative politician a break like she just did to Obama in reaction to what he said. The exchange would be Exhibit A in her next column about what a weak, thin-skinned weenie the guy was.

But back to Dowd-Obama: The “ears thing” isn’t even the half of it.

Let’s look at a couple of other things MoDo has written about Obama recently.Here she is in her Nov. 11 column, four days after the mid-term elections:

Talking about hope and opportunity and inspiration has propelled Barack Obama into the presidential arena. His approach seems downright feminine when compared with the Bushies, or even Hillary Clinton. He languidly poses in fashion magazines, shares feelings with Oprah and dishes with the ladies on ”The View.”

Now to her Dec. 13 column — First the title (!), then the last two sentences.

Will Hillzilla Crush Obambi?

….. So there is a second question, perhaps one that will trump race and gender. It’s about whether he’s tough and she’s genuine.

Wow. Maureen Dowd has seen Barack Hussein Obama up close and personal. She has recognized the faux-forceful tenor of the voice that chided her and fears — nay, almost knows — that he is at best a fortysomething version of one of these. Even worse, she’s frightened to death that he could actually be one of these, or, conceivably, even one of these (item 3a at link).

MoDo knows her Democratic men, and she can spot serious trouble in a Democratic male candidate. It is clear from what she has written that she isn’t just trying to “toughen up” Barack Obama about his ears; no, she’s clearly worried that “toughening him up” is a comprehensive long-term project that has a high probability of turning out badly. I believe she would prefer that the project not be launched.

_______________________________

UPDATE: Here are links to a virtual Obamarama of “Earie” art and commentary — Return of the Conservatives, Riehl World View, Rush’s home page and supporting post (both will change Friday evening), Stuck on Stupid, Radio Equalizer, WmWms, American Harbinger, Hang Right Politics, Holy Coast, Right Jokester, and Church Militant.

UPDATE 2: America’s Next First Lady speaks to the Obama Ear Flap –

It’s not his big ears – but his big mouth that he should worry about. And now, Mrs. Obama, it’s your job to make him put a sock in it.

Geez, who’s the candidate here?

Couldn’t Help But Notice (121506)

Two more tips (here, which may require registration; and here, with a HT to RightAngle at RAB) of a very big iceberg have peeked out of the water. It’s not pretty.

____________________________________

If this becomes law (HT Instapundit), and if it’s deemed to apply to bloggers (many are saying it will, regardless of John McCain’s intent), no blogger, forum, or anyone else with a brain will allow unmoderated comments (Comment sections not allowing pics can still have links to them).

____________________________________

I agree that if I were Microsoft, I would not be bragging about this (HT Techdirt):

The launch of Microsoft’s Vista will create 100,000 jobs in the US, the same as that claimed for Europe, but will bring in almost twice as much cash – some $70bn.

Hey, the consultants will be happy, but Techdirt sees the larger point:

Put another way, companies will have to bring on 100,000 more people and spend another $70 billion to deal with the launch, if the figures are accurate. Why are they bragging about this again?

Mac Snob Alert: Would mass conversion to OSX cost anywhere near $70 bil?

___________________________________

Tax tips — These three items were legislated into effect for another year by Congress last week (actually more were, but the others are too boring and narror to mention):

  • The deduction for state and local sales taxes (you get to deduct the greater of state/local sales taxes or state/local income taxes IF you itemize)
  • The above-the-line deduction for qualified higher education expenses
  • The above-the-line deduction for teachers’ classroom expenses (I believe this up to $250)

The aforementioned mind-numbing detail would not have been necessary if the Fair Tax were in place instead of our insult-to-our-intelligence income tax system.

Delinquencies and Foreclosures Edged Up (MarketWatch, which requires free regstration, said “Jumped,” which I say is an exaggeration, except for subprimes, which DID jump):

U.S. homeowners had a harder time keeping up with their mortgage payments in the third quarter, the Mortgage Bankers Association said Wednesday, with the delinquency rate rising to 4.67% from 4.39% in the second quarter. A year ago, 4.44% of mortgage holders were 90 days or more past due on their loans.
The foreclosure rate inched higher in the third quarter, with 1.05% of mortgages in the foreclosure process vs. 0.99% in the second quarter, the MBA said. While delinquency rates on all types of loans rose in the third quarter, it was the subprime category — loans made to less creditworthy borrowers, that shot up the most to 12.56% from 10.76% a year ago.

A comprehensive disaster appears not to be on the horizon, except in subprimes, which if bad enough (and it isn’t yet nationally, but it is in some locales), could pull the real estate market down with it. The subprime problem can be laid at the feet of the mortgage securitizers (Fannie Mae, Freddie Mac, etc.), who relaxed standards way too much; some lenders, who approved loans they knew people had little chance of repaying; and many borrowers, who should have known better. The “fun” will be divvying up the blame if subprime delinquencies get much worse.

Items Not Picked Up Elsewhere in (whoa) Biz Weak

Maybe my favorite moniker for this usually very weak publication doesn’t apply in this instance.

Here are a few nuggets in the last two issues of Business Week that I haven’t caught anywhere else (links may require subscription):

  • (Dec. 11) Iran’s oil production is sufferiing for the same reason it always does in a despotic nation — diversion of funds that should be used for investment to other things, shortage of native expertise, excessive conusmption due to below-market domestic pricing. This as much as anything else may explain why Ahmadinejad is “suddenly” having some difficulty on the home front.
  • (Dec. 11) The New York Times has apparently been in discussions about going private for several months.
  • (Dec. 18) Web pharmacy fraud — “Only 11% ….. require a prescription. ….. (therefore) 89% appear to operate illegally. 15 billion e-mail messages a day are spam for drugs, yielding tens of thousands of purchases a day.” Following up on this post and the comments from Tuesday, if it’s, say, 30,000 purchases a day, that’s only a 0.0002% conversion rate. Doesn’t matter; sending the messages costs the spammer almost nothing, and despite everyone’s best efforts, that rate will never get to zero.
  • (Dec. 18) Maybe there is some justice — BizzyBlog Internet Wall of Shame member Yahoo! only has a 5% share of China’s Internet search requests (leader Baidu has 62%; Wall of Shame member Google has 25%). For this reason and others, the also-ran status is richly-deserved.

Your Government-Owned Enterprise Dollars at Waste (121506)

Filed under: Consumer Outrage,Taxes & Government — Tom @ 6:05 am

I guess it’s all just, uh, water under the bridge (link may require free registration):

For years, New York City has failed to collect on millions of dollars in overdue water bills because its records are so riddled with factual errors and outdated information that pursuing deadbeats and delinquents has become virtually impossible.

An examination of the city’s water records by The New York Times revealed that, at least on paper, tens of thousands of property owners have not paid a penny for water in at least two years. Officials insist that debtors collectively owe hundreds of millions for water they used but never paid for.

But whether they are true deadbeats or customers with legitimate disputes, all debtors enjoy a virtual immunity because the city, unlike Boston or Los Angeles, will not use aggressive collection methods like service suspension because its records are so unreliable.

A private company, or in this case a privatized water company with appropriate mandated municipal oversight, would never let things get this screwed up.

Positivity: Electric Breakthrough Goes Commercial

Filed under: Business Moves,Positivity — Tom @ 6:00 am

These things obviously take time. But the time for high-temperature “superconductors,” a term some of us recall was thrown around with reckless abandon during the 1980s, has come:

December 12, 2006
Electric breakthrough goes commercial
Utilities and even the Navy are snapping up new and highly efficient superconductors.

WESTBOROUGH, MASS. — Twenty years after their much ballyhooed discovery, high-tech materials capable of delivering 150 times the electricity of conventional wire are starting to push into the commercial market.

They promise to make generators, industrial motors, and even power lines far more efficient as the technology becomes more affordable. At least eight new cable projects already are under way in the United States, Europe, China, South Korea, Japan, and Mexico. This month, a leading US innovator in the field will shove out the factory door its first commercial product using the technology, which will help the Tennessee Valley Authority (TVA) keep its grid stable.

“It’s been a long time coming, a real marathon, but it’s exciting because we’re seeing the promise become reality,” says the firm’s president, Greg Yurek, of American Superconductor Corp. in Westborough, Mass.

Only about a dozen companies worldwide specialize in the technology – high-temperature superconductors (HTS) that can deliver electricity with nearly no resistance to the current. Besides ASC, two are based in the US: SuperPower Inc., a subsidiary of Royal Philips Electronics, and MetOx.

“It’s not just R&D anymore,” says Trudy Lehner, a spokeswoman for SuperPower. “It’s clearly moving into a commercial stage.”

This year, ASC has seen orders soar for its HTS wire. In September, a Korean research institute ordered 22,000 meters of it. Later this month, ASC will send the US Navy in Philadelphia a superconducting motor made with HTS wire for its newest warship – a motor less than half the size and one-third the weight of a copper-based motor.

“The market right now is much more poised for this type of technology than what we would have seen just a few years ago,” says Neal Elliott, industrial program director for the American Council for an Energy Efficient Economy, a Washington advocacy group.

….. That may change if the economics improve. On the basis of cost per unit of power transmitted, first-generation HTS wire is twice to three times as expensive as copper cable, depending on the application. By 2010, Yurek claims ASC’s second-generation wire should have roughly the same price performance as copper.

Read the whole thing.