31 March 2010

Bulgarian Councilman Booted for Tending his Imaginary Farm

AOL News

Anyone who plays FarmVille knows it is critical to harvest your crops on time. But maybe it's not as important as administrating the second-largest city in Bulgaria.

Dimitar Kerin was voted off a committee assignment by the Plovdiv City Council for his inability to stop tending his virtual crops on the Facebook game during meetings.

Kerin was not alone in his obsession among council members. Council chairman Ilko Iliev had previously warned several of them that the new wireless network and laptops provided to all 51 council members were not to be used for playing games on social media sites during budget meetings. Kerin was singled out for continuing to manage his farm and milk his cows despite Iliev's warnings.

Saying that Kerin "needs more time for his virtual farm," council member Todor Hristov made the proposal to oust Kerin, according to Novinite, a news agency out of the Bulgarian capital, Sofia. Kerin was voted off his committee 20-19.
FarmVille is the most popular app on Facebook and winner of "Best Social Game" at the 2010 Game Developer Choice Awards. Games like it can be particularly addictive because of its real-time game mechanics. Crops are going to mature and even die whether or not players are logged in. If they want to maximize their yield, they better be ready to bring in their crops the second they're ready to harvest. Even if it's during a city council meeting.

The blog "Gameolosophy" has some advice for people like Kerin about managing their FarmVille obsession without going cold turkey:

"Prefer crops whose maturity takes three to four days to ripen to those that take only hours," blogger Sheila Europa writes. "This way, you won't have to keep your game window open, thus eliminating the need to be glued to the screen the whole time."

30 March 2010

Murdoch to Sulzberger: You are a Girly Man ?

Vanity Fair

It’s not just that Rupert Murdoch doesn’t like Arthur Sulzberger, or doesn’t think he’s a serious newspaper publisher. It’s that he thinks he’s weak—girly. Sulzberger—“young Arthur”—was a frequent subject during the many hours I talked to Murdoch when I was writing his biography. Sulzberger was always, for Murdoch, a punch line. Murdoch even mimicked him in a way to suggest … well … a certain lack of manhood.

It is a joke that is shared by Murdoch and Robert Thomson, the former Australian-rules football player who is now the editor of Murdoch’s Wall Street Journal: Arthur is a sort of poofter.

Well, on the front page of the Journal’s Weekend section this morning is a feature on how women from healthier populations prefer feminine-looking men. The piece is illustrated with a grid showing facial features of such feminine-looking men..

There is, in the bottom image of the lower quadrant of a male face, an unmistakable—if you pay attention to such things—dimple and odd right ear.

Without a doubt, the Wall Street Journal has selected Arthur Sulzberger as a prime example of its idea of a feminine-looking man.

Pure coincidence?

Murdoch often uses the editorial power of his papers to pursue his business goals. Foremost on his agenda is to maul The New York Times. Murdoch believes that one advantage he has in going after the Times is that Sulzberger is so easy to play and rile up—Murdoch once, with me, used puppet strings to refer to Sulzberger—and that Murdoch has a special understanding for how to get under Sulzberger’s skin. In the past, Murdoch has taken particular delight when the New York Post’s “Page Six” has ridiculed Sulzberger—with Sulzberger calling Murdoch personally to protest. “Whinging” is the word Murdoch uses for Sulzberger’s calls.

So just imagine what Young Arthur felt this morning when he saw the lower quadrant of his face in the Journal representing the archetypal girly-man.

This is a psychological warfare side of what’s going to be a very nasty newspaper war.

Anheuser-Busch InBev Pits Madonna Against Paris Hilton in Marketing Blitz‏

AB InBev Enlists Madonna, Pussycat Doll Amid Marketing Splurge

Anheuser-Busch InBev NV hosted Madonna and Pussycat Doll Nicole Scherzinger in its Brahma Box and plastered Rio de Janeiro’s streets with billboards during last month’s Carnival as part of an advertising blitz.

Better known for its cost-cutting culture, the maker of Budweiser and Stella Artois kept marketing spending as a percentage of sales near 2008 levels last year, while SABMiller Plc and Heineken NV cut back.

Chief Executive Officer Carlos Brito, who flies economy class, boosted advertising spending by 20 percent to $1.4 billion in the final quarter of last year alone. That increase came at the expense of profit, with the Belgian company missing analysts’ earnings estimates by about 7 percent.

“There has never been any doubt that Brito and his team are the best cost-cutters in the industry, the question was whether they could simultaneously build brands,” said Matthew Jordan, head of research at Matrix Corporate Capital LLP in London. The increased marketing “puts AB InBev at the vanguard of the industry’s race to rebuild advertising and promotions.”

Brazilian-born Brito, CEO of InBev NV since 2005 and formerly head of Cia de Bebidas das Americas, or AmBev, oversees a management team with a zero-based budgeting approach -- where every expense must be justified each year. After paying down or refinancing debt from 2008’s $52 billion purchase of Anheuser- Busch Cos Inc., the world’s largest brewer is giving all its attention to growth from its existing brands for the first time.

Building Brands

AB InBev will invest in its main brands “come hell or high water,” Chief Marketing Officer Chris Burggraeve said in an interview from New York.

“Our company is often seen in one way, but this is a story of ‘and’ and not ‘or’ when it comes to operating efficiently and building brands,” he said.

With few options for transformational beer mergers, and an ongoing arbitration with Grupo Modelo SAB standing in the way of AB InBev buying the 50 percent of the Mexican brewer it doesn’t own, the company is using marketing to drive growth.

So-called organic sales -- the “key health indicator for consumer companies,” according to UBS AG analyst Melissa Earlam -- will likely increase 3.5 percent in 2010, the median estimate of nine analysts surveyed by Bloomberg News showed. That compares with estimated sales growth of 1.2 percent at Heineken and 5.2 percent at SABMiller, the survey showed.

AB InBev shares have risen 4.3 percent this year, trailing Carlsberg A/S’s 20 percent gain, Heineken’s 16 percent jump and SABMiller’s 7.2 percent climb. They more than doubled in 2009.

Budweiser Select 55

In the second half of 2009, AB InBev released Bud Light Golden Wheat and Budweiser Select 55 in the U.S., and new varieties of its Antarctica and Bohemia brands in Brazil to attract new consumers. In the U.K., a new Budweiser campaign was supported by billboards, TV commercials, and print advertisements, while on-pack promotions focused on the brand’s sponsorship of soccer’s World Cup in South Africa.

“The fact that against a backdrop of media deflation, AB InBev have increased spend shows they’re playing things for the long-term,” said UBS’s Earlam. “It’s what you want to see.”

Investing more in advertising its brands will not only spur volume sales this year, it will give AB InBev greater power to increase prices in the future, Burggraeve said.

“Brand health today is price-premium potential tomorrow,” said the executive, who worked at Coca-Cola Co. and Procter & Gamble Co. prior to joining AB InBev in 2007.

Simulated Striptease

AB InBev trails Heineken in terms of price per hectoliter of beer sold with the Belgian brewer generating about $92 per hectolitre this year, compared with 123 euros ($164) per hectolitre sold at Heineken, according to the analyst survey.

“In the past AB InBev may have been more concerned with volume share than value share in markets,” said Evolution Securities Ltd. analyst Andrew Holland, who has a “buy” rating on the shares. “Big, dominant positions, like they have in Brazil, will make it easier to get prices up.”

The company’s sales growth will be amplified when it begins to sell Budweiser into Latin American markets and sells more Stella Artois and Beck’s in the U.S. through Anheuser distributors. The brewer is evaluating which markets are the most suitable for Budweiser, though is in “no hurry,” Chief Financial Officer Felipe Dutra has said.

In Brazil, AB InBev called on Madonna and Scherzinger to help promote its brands when its main rival in the country got Paris Hilton to simulate a striptease on TV.

The singers joined local celebrities in the Brahma Box during last month’s five-day Rio Carnival as Primo Schincariol Industria de Cervejas e Refrigerantes SA aired commercials with Hilton fondling a can of Devassa at the window of her apartment.

New Campaigns

While the sales impact of new campaigns in Brazil was immediate, a return on the sudden increase in spending in more depressed markets or on previously neglected brands will take longer, said Matrix’s Jordan.

“If the brands were in poor health, it will take some time, perhaps even a few years, of heavy advertising for them to catch up with competing brands,” Jordan said.

In the U.K., outspending every other lager brand last year has already paid off for AB InBev: billboards designed by James Bond poster artist Robert McGinnis spurred market share gains for Stella Artois, reversing five years of retreating share in the 18 billion-pound ($27 billion) market.

SABMiller has cut sales and marketing expenditure in Latin America from around 11 percent of sales in the prior two years, when it invested in revamping the Bavaria brand in Colombia, to between 7 percent and 8 percent.

Most Valuable Brands

“Our approach is primarily about optimizing return on marketing investment,” said SABMiller’s brand communications director Charlie Hiscocks. “Expensive marketing does not necessarily equal effective marketing,” he said, also noting that the cost of advertising has fallen.

Heineken’s marketing spend was 11.3 percent of sales last year, down from 11.7 percent in 2008. “We haven’t launched many new propositions,” said spokeswoman Veronique Schyns.

AB InBev now controls the world’s most valuable beer brands in Budweiser and Bud Light, which explains the shift in its attitude towards marketing, according to Royal Bank of Scotland Group Plc analyst Jonathan Cook.

“InBev recognize that the branding side wasn’t necessarily their utmost priority, and they’ve got such an opportunity with Budweiser that that had to change,” said Cook, an analyst at in London with a “hold” rating on the shares. “They are showing they’re much more than just an acquisition machine.”

29 March 2010

Even with Comcast's new Web Site, 'TV Everywhere' Still Isn't

The Washington Post

Subscribers to Comcast's TV and Internet services have been getting a little something extra lately: access to a Web site that lets them watch many of the channels their bills cover. 

The site, called Fancast Xfinity TV (http://fancast.com), builds on an earlier version that left out premium channels. The Philadelphia-based carrier launched it in December and brought it to the Washington area last month. 

Fancast Xfinity is the most ambitious attempt yet to implement an idea called "TV Everywhere." Under this concept, channels and providers work together to provide online access to shows and movies -- but only to people who already pay for conventional, offline viewing on televisions. (Verizon is testing a similar service called Fios TV Online.) 

That authentication requirement makes logging onto Fancast Xfinity a little more complicated than watching a sitcom on Hulu or one of the networks' own sites. In addition to subscribing to both Comcast's TV and Internet services, you also need to install a Comcast Access program -- which itself installs extra video and support software. 

Once you've entered the user name and password of your Comcast account -- I used a temporary one arranged by Comcast's public relations department because I don't subscribe to its services -- you authorize your computer for access to the site. You can also authorize two other computers at any time. 

This wasn't any particular trouble to set up on a Windows 7 laptop. On a Mac, however, I could use the site only in the Firefox browser -- for reasons unexplained in its system-requirements page, Fancast Xfinity doesn't work in Apple's Safari browser on the current version of Mac OS X without extra tweaking. 

Comcast touts an inventory of 19,000 TV shows and movies, but that impressive-sounding total falls well short of what its cable boxes can deliver. Sports are mostly out, but even among the comedy, drama and documentary offerings, you find strange gaps. For example, its HBO content is just as spotty as that channel's new HBO Go site, leaving out the likes of "Entourage" and "Curb Your Enthusiasm." Its AMC selection excludes "Mad Men," while Apple's iTunes Store sells entire seasons of that show. 

You can't blame those gaps on Comcast, though. Each network has to decide whether it wants to build an audience by giving viewers more ways to watch its work -- or whether it would rather stick with last decade's business model. 

You can, however, blame Fancast Xfinity's usability issues on Comcast. This site provides far fewer ways to manage your viewing interests than Hulu; you can't add shows to a queue or have the site add new episodes to that playlist automatically. It doesn't say whether particular titles are in high-definition or something less than that. And its lists of what's available are categorized sloppily. "Slumdog Millionaire" is filed under "comedy," for instance. 

Picture quality varied wildly, even over a fast, 15 megabits-per-second Fios connection. A Food Network "Throwdown With Bobby Flay" show could have the look of a VHS recording; MTV's "The Real World: D.C." came closer to standard-definition TV quality; an episode of "The Wire" looked better yet (but sometimes mysteriously slowed down); the first chapter of HBO's "Band of Brothers" came over in crisp high-definition that looked terrific even on a 40-inch HDTV (but I had to reboot the computer to get out of a cycle in which Comcast Access asked me to authorize the laptop for viewing, had me sign in again, then asked me to authorize the laptop for viewing again). 

Bear in mind that Fancast Xfinity is free to Comcast subscribers. And even with its quirks, it provides a convenient way to catch up on missed episodes, sample new shows and follow your favorite programs -- like a TiVo in the sky. 

In that respect, it's a far better way to breathe new value into a cable subscription than stuffing still more channels into a programming bundle. 

But what about people who don't subscribe to Comcast but might gladly pay less for online-only viewing? My experience suggests that's technically possible, but Comcast doesn't seem interested in poaching customers from competitors that way. Wrote spokeswoman Kate Noel: "Right now we have no plans to offer this as a service separate from their television service." 

Fair enough; this site is Comcast's business to run as it sees fit. I'll just say this: I can only wish my employer were doing so well that it could afford to ignore potential markets. 

28 March 2010

Autistic Teen has Perfect NCAA Bracket

Back Porch Fanhouse

How is your bracket for the NCAA Men's basketball tournament looking right now? Lots of red ink (or "Xs," or whatever you do to signify a missed game), I presume? Well, you obviously didn't fill it out the way Alex Herrmann did.

His secret, as you can see from the video below, is that he loves the numbers. As a person living with autism, he apparently studied numbers so much that he found the winning combination, at least to this point.

View more news videos at: http://www.nbcchicago.com/video.

"I'm good at math," Alex told NBC Chicago. "I'm kind of good at math and at stats I see on TV during the game."

Northern Iowa over Kansas? Check. Ohio over Georgetown? You bet. Mr. Herrmann hit every single game and has a perfect Sweet 16. His apparent affinity for all things numerical along with some luck -- after all, there were a few close calls in the first 48 games, no -- has him in position to make a historic run among the massive amount of people who fill out a bracket religiously each March. You'd think he's destined to see things fall apart soon (he has Purdue winning it all), but I don't know anyone who has picked every game correctly thus far. Why doubt him now?

Perhaps he should have pursued something more lucrative than entering CBS' free bracket competition. Unfortunately, that was his only entry. He could have won up to $10,000,000 with a perfect bracket on FanHouse, a cool mil on Yahoo!, and a whopping $13 million on sportsbook.com. Of course, since Alex is only 17, he wouldn't have been allowed to collect any of these potential jackpots.

To wit, Alex's mother told NBC Chicago potential financial gain wouldn't have made much a difference anyway.

    "If he would have won any money he would have just saved it," his mother Diane said. "He's a big saver."

Not shockingly, it hasn't taken long for the anonymous skeptics of the internet to start levying accusations against Alex and his brother (a 24-year-old Purdue grad who is in charge of the CBS "bracket manager" game in which Alex entered his bracket). Deadspin, due to the apparent outrage of a few readers who emailed them, illustrated how easily you could change picks in the CBS bracket manager portal, though they did not accuse the family of doing this.

Frankly, this kind of thing is very aggravating. No one can just enjoy a story anymore without trying to find the negative in it. For the cynics out there, though, I'll humor you. It's possible. Here's my question, in response: Why now? If the family was going to pull the wool over the eyes of the nation, why didn't they wait until the Final Four or even later? And what did they have to gain in terms of finances? No one is paying anything for a perfect bracket through two rounds that could easily fall apart in one game. If they really wanted to hit it big in a nefarious way, they'd have waited. Additionally, the family of a person with autism knows that large amounts of attention only cause said person to shut down, as sticking with a set routine is what keeps them centered. They wouldn't have brought this hoopla upon themselves just for kicks. In fact, the family politely declined an interview request from FanHouse.

Alex referred to how his picks have fared thus far as "amazing," and I believe everyone with a heart should agree and leave it at that. Remember, being incredibly unlikely doesn't equate to impossible.

According to some research, the odds of a perfect bracket throughout the competition could be around 150 million to 1. Sure, it's one of the most incredible long shots you'd ever hear about, but it's not impossible. Also, it's important to note Herrmann hasn't yet come close to doing this. There are still 15 remaining games in the NCAA Tournament.

Maybe it's emotion that takes Herrmann down eventually. He came across as a methodical thinker in explaining his success to this point, but, as I mentioned earlier, his pick for national champ is Purdue -- the team that is his favorite due to his brother having attended there.

His Elite Eight teams are: Northern Iowa, Tennessee, Syracuse, Kansas State, Baylor, Purdue, Kentucky and West Virginia. In the Final Four, Alex has Tennessee, Kansas State and Kentucky joining Purdue, with Kansas State finishing as the runner-up.

Finally, I hope Alex would be proud of me. While I'm not even in the same ballpark when it comes to his prowess in prognostication, I did do enough to win $1,000 for Autism Speaks (my four-year-old daughter is autistic) in a charity picks contest on RichardGardner.com -- by having the most points after two full rounds.

Solidarity, brother.

24 March 2010

Mind Over Media?


The neuroscience behind effective media planning

The marketing world faces an increasingly complex challenge – that of understanding what truly motivates a consumer to select one brand over another, and the resulting role different marketing channels can play in influencing this decision. In this respect, marketers have long lacked access to one fundamental piece of insight which can inform effective marketing channel choice and drive a media strategy; namely how the human brain physically processes the messages provided.

Royal Mail commissioned independent research through Millward Brown, employing the University of Bangor’s psychology department and fMRI (functional Magnetic Resonance Imaging) scanner to image the different parts of the brain which are activated when stimulated by either a physical, printed message like direct mail, or digital marketing such as email or online advertising.  The fMRI scanner was used to map the activated parts of the brain in research subjects by highlighting changes in the blood supply.

The research was conducted among 10 males and 10 females from the local Bangor area, with an average age of just over 30. They were shown prompts of physical direct mail and digital marketing on a screen, which had been edited to show just the basic elements of images and text. Each participant saw half of the adverts in paper format and half in digital format.

‘Scrambled’ images were also used to provide a control for the impact of colours and text, and to allow researchers to account for physical material stimulating more than one sense (touch and sight). By subtracting results for the original image from the scrambled, researchers could identify those brain patterns relating to the content of the materials rather than the sensory qualities of the medium, and identify areas of the brain stimulated by online versus those engaged by hard-copy materials.

The study found that physical media generated more activity in the parietal cortex, an area closely associated with the integration of visual and spatial information. This suggests that print-based material is more ‘concrete’ for the brain, and can act as a cue for memory. This may mean that physical direct mail material has a better connected memory ‘trace’ in the mind. This is not simply due to the fact that physical media is just that – tangible, and therefore stimulating to both sight and touch. It seems the multisensory nature of the material results in the print marketing methods being seen as more ‘real’ by the brain.

Direct mail-based material was also associated with responses which suggest greater ‘internal’ thinking – suggesting it is processed more in relation to subjects’ own feelings and memories. Researchers focused on the ‘default network’ in subjects’ brains, which is a network of brain regions which become more active when a person is not focused on the outside world. When given physical print stimuli, this region was less deactivated than when subjects were presented with digital information .

Material presented to subjects on the screen elicited responses associated with greater difficulty in maintaining attention on the task. Researchers noted that online materials proved harder to focus on, engaging areas of the brain associated with greater filtering of irrelevant information in order to attend to the task, such as the temporo-parietal junction.

Perhaps most strikingly, physical prompts were found to elicit brain activity in regions closely associated with emotional processing, such as the limbic region. Arousing emotions is widely accepted in marketing practice to provoke a more favourable response, but this is typically communicated by the creative rather than the medium itself. This study’s findings suggest that physical, tangible media can stimulate an emotional reaction which results in enhanced recognition, heightening the priority given to the brand in subsequent encounters.

For marketing strategies which need to capture people’s attention to communicate content, emotional connections can be vital in opening the door to a response, establishing a positive emotional impact and giving subsequent communications a more receptive response. This study suggests that physical communications can act as ‘priming agents’, helping a brand message to establish a more visceral emotional connection which can be vital in the initial stages of a campaign to set brand recognition and pave the way for future messaging.

The marketing industry has long recognised that different channels can be used for different effects in campaigns, but the addition of neuroscience to the mix adds another layer of insight to a media planning process which is becoming increasingly complex in a rapidly fragmenting media landscape. When it comes to media selection – which tools to use at which stage of the communications process – this study makes a strong case for the media world to take into account how each media channel is physically processed in the brain.

23 March 2010

More Cities Ban Digital Billboards

USA Today

As the USA cracks down on texting while driving, more than a dozen cities around the nation have banned what some consider a growing external driving distraction: digital billboards.

Digital billboards change images every four to 10 seconds, flashing multiple messages from one or more advertisers on the same sign. Opponents such as John Regenbogen of Scenic Missouri deride them as "television on a stick."

Several communities have banned digital billboards outright, the most recent being Denver earlier this month. Other places have put a moratorium on them pending a federal study on whether they distract drivers. At least two other cities and two states are studying moratoriums.

"The digital billboards are a distraction," says Fred Wessels, an alderman in St. Louis, which just approved a one-year moratorium on new such signs in that city.

"If they weren't distracting, they wouldn't be doing their job," says Max Ashburn, spokesman for Scenic America, a national non-profit group that seeks to limit billboards.

Research on the issue is mixed. A Virginia Tech Transportation Institute study in 2007, financed by the billboard industry, found that they aren't distracting. A review of studies completed last year for the American Association of State Highway and Transportation Officials, however, concluded that they "attract drivers' eyes away from the road for extended, demonstrably unsafe periods of time."

"There's no doubt in my mind that they are not a driving distraction," says Bryan Parker, an executive vice president for Clear Channel Outdoor, which owns about 400 digital billboards. He cites industry-sponsored studies of collisions before and after digital billboards were installed in Albuquerque, Cleveland, and Rochester, Minn., that found no correlation.

"We've looked at that very carefully," says Bill Ripp, vice president of Lamar Advertising, which owns 159,000 billboards, 1,150 of them digital. "We don't want to cause any unsafe conditions for drivers."

Digital billboards are a fast-growing segment of the outdoor advertising market. Since a federal rule against them was eased in 2007, the number of digital billboards has more than doubled to about 1,800 of 450,000 total billboards. At least 39 states allow them. They cost an average $200,000 to $300,000 apiece, according to the industry group Outdoor Advertising Association of America.

In 2007, the Federal Highway Administration relaxed a rule against digital billboards, saying they don't violate the 1965 Highway Beautification Act's ban on "intermittent," "flashing" or "moving" lights. FHWA is researching the signs, using eye-trackers inside volunteers' vehicles to determine whether drivers look at the billboards and for how long. The study is to be completed this summer.

There is little current data on whether greater distractions for drivers come from in-vehicle or external factors. The Department of Transportation, which is leading the national push against texting while driving, says that 5,870 people were killed in distracted driving crashes in 2008. But the agency has not determined how many of those deaths involved an electronic device, another distraction such as eating or tuning the radio, or something outside the vehicle.

22 March 2010

AOL Goes 'Local' with $10M VC Fund

Washington Business Journal
AOL Inc. continues to bet on local content, establishing a $10 million venture capital fund it will use to make investments in startups focused on local markets.

AOL said it will also increasingly incorporate local content on its AOL.com homepage, using geographical targeting to match content to where a user is located.

“Local is one area of the Internet that has not been built out in an extensive way,” said AOL CEO Tim Armstrong. “While there are companies in the local space, AOL has the technology to digitize the local space at scale. We believe it is an untapped market for the most part and one of the largest commercial opportunities online that has yet to be won.”

AOL will also expand its Patch network, a local content and advertising network of community focused content. It already has a presence in about 40 cities and will add 15 more. As part of that expansion, AOL will hire local editors in each town it serves.
AOL will also relaunch its City’s Best network, local entertainment guides, in 25 cities by this fall.

AOL, whose spinoff from Time Warner Inc. was completed in December, is betting its future on content, much of it provided by outside sources. Its Seed.com portal is specifically for freelance journalists, writers, photographers and videographers who are seeking out assignments or who submit original content.

AOL has also been investing in technology, acquiring dozens of small companies whose technology can enhance its own multimedia and marketing capabilities.

AOL had $239 million in 2009 earnings, compared to a $1.5 billion loss in 2008.

AOL has cut its workforce by a third, mostly through layoffs after a participation in voluntary buyouts fell short of goals. The company had 2,400 employees in Northern Virginia at the end of 2009. It moved its corporate headquarters from Dulles to New York in 2008.

20 March 2010

New Social Marketing Trend: Group Buying Sites

Raleigh News Observer

It used to be that companies looking for new customers would take out an ad or make a new TV commercial.

But now a legion of new Web sites are harnessing the power of social networking sites like Twitter and Facebook to help businesses connect directly with customers.

The sites, which are generally called "group buying sites," combine two of many shoppers' favorite things: bulk buying and a hidden deal.
Three such sites - groupon.com, livingsocial.com and twongo.com - started operating in the Triangle in the last month.

All three offer a deal-of-the-day that shoppers can elect to buy. On Friday, Twongo offered a $50 gift certificate to Cafe Parizade in Durham for $27.

Users are encouraged to share the deals via Twitter, Facebook and other social media for an instant word-of-mouth vibe.

Each site, however, has a unique twist on its deal.

Twongo's discount increases as more people buy the deal. For instance, if enough people purchased that Parizade certificate the price would drop all the way to $23 for everyone. Groupon has a "tipping point" - a certain number of buyers are required before the deal becomes a reality. And at LivingSocial.com, if you get three friends to buy the deal-of-the-day, you get it free.

Such Web sites are gaining popularity, said Larry Joseloff, vice president of content for Shop.org, the National Retail Federation's online shopping division.

"I think it's become hip again to find a great deal and to find great value, and I think retailers are trying to find new ways to be creative," he said. "I've heard both schools of thought, that this is a sea of change and that this is a temporary shift. Only time will tell."

The businesses that offer deals through the group-buying Web sites generally don't make much on the offers.

The deals are usually at least 50 percent off what a customer would normally pay in the restaurant or store. But the businesses don't even keep all of that; most split the profits with the site. So Cafe Parizade would get about $12 for that gift certificate and serve up a $50 dinner.

Still many business owners see the sites as just another way to advertise.

"I think a lot of marketing is keeping your name in front of people, and it costs money to keep your name in front of people," said Brad Hurley, co-owner of the 42nd Street Oyster Bar in Raleigh. The restaurant recently sold 277 $50 vouchers for $24 each on twongo.com.

The Twongo deal is better than other advertising methods such as home mailers, Hurley said, because it's a sure thing.

"With more traditional advertising, you have to give something away kind of as a hook to get somebody there," he said. "This way, you're generating some revenue, and if people go online to buy a certificate then there's a real good chance that they're going to come and use it."

Still, business owners should be prepared before jumping into the group-buying social media arena, cautioned Shawn Briscoe, co-owner of the Alter Ego salon in downtown Raleigh. Alter Ego offered a manicure and pedicure deal valued at $55 for $25.

They sold more than 400 of them. Briscoe was expecting a few dozen at most.

"You have to be prepared for the power of it, I think," she said.

The salon had to institute a per-day limit on the number of Groupon coupons they can take.

"Otherwise, we wouldn't be able to pay our rent," Briscoe said.

But overall, she said, she was pleased with the experience; many of the new customers are booking return visits.

"It really blew my mind," she said. "But if we had done haircuts or something, we would have really been in trouble."

As for the sites themselves, they say they hope their growing numbers increase awareness of this type of shopping.

Cary-based twongo, launched in the Triangle on Jan. 22, is already considering expanding to new markets, said Scott Bowen, one of three founders.

"Companies are starting to call us now, which is really cool," he said.

Having started in 2008, Groupon is one of the oldest and largest of the group-buying sites with 3 million subscribers in 40 cities across the country.

The Chicago company launched in Raleigh-Durham on Feb. 7 and has 20,000 subscribers here. It has sold 4,000 deals in the area.

Groupon is trying to entice shoppers by adding things like business reviews and chat functions, said Mark Desky, vice president of marketing.

"We started kind of more as a city guide, but now that we're in so many markets, people now consider us as a travel guide," he said.

And, as social media sites like Twitter continue to expand, group-buying sites see more opportunity.

"I think social media is no longer just for young people," said Jake Maas, CFO of LivingSocial, which is based in Washington, D.C., and launched Thursday in the Triangle and three other cities.

"I think a lot of merchants are surprised at the extent to which they can actually reach out and attract new customers. And they don't have to actually believe us. Because at the end of the day, what they really care about is can you actually deliver customers. And we're able to do that in a very tangible and transparent way."

19 March 2010

Man Accused of Stalking Ivanka Trump Arrested

USA Today

A 27-year-old man accused of stalking Ivanka Trump has been arrested in Reno

Police say Justin Massler was arrested Tuesday on a New York warrant alleging he used the Internet to stalk the daughter of Donald and Ivana Trump.

Ivanka Trump, 28, is the co-host of Celebrity Apprentice and a vice president at her father's real estate company.

Massler described himself in a blog posting as "a celebrity stalker who is obsessed with Ivanka Trump."

Massler had been living on the East Coast and visiting his mother in Reno. His mother, Randee Massler, says he has only written about Trump on the Internet and hasn't come close to her.

He remains held in the Washoe County Jail in Reno.

Verizon Seeks to Ban Cablevision Set-Top Boxes


As competition for video subscribers heats up in the New York City area, Verizon Communications Inc. has taken a swipe at cable TV rival Cablevision Systems Corp., accusing it of infringing on several Verizon digital set-top box patents.

Verizon filed a complaint Tuesday with the U.S. International Trade Commission seeking to ban imports of certain digital set-top boxes used by Cablevision. Verizon accuses the cable operator of violating five of its patents, including one on programmable set-top boxes.

Verizon also wants Cablevision to stop offering for sale or lease imported digital set-top boxes that allegedly violate its patents.

It says Cablevision is using Verizon set-top box technology to compete against it. Verizon offers FiOs TV service in the New York City area.

Cablevision said Verizon is suing because it can't compete.

"It is becoming increasingly clear that Verizon is having difficulty competing on the merits in the marketplace, so they are resorting to filing lawsuits and pursuing regulatory bailouts," Cablevision said in a statement. "We obviously plan a vigorous defense."

Verizon said it limited its complaint to one claim for each patent so that the matter could be resolved quickly in about 12 months.

17 March 2010

Please Accept Cookies: Girls Scouts take to the Web

Voice of America News

Each year, young girls fan out,  turning to friends and neighbors — as well as their parents' coworkers — to sell Girl Scout cookies.

The treats have been something of an institution in the United States for more than 80 years. The ad campaigns have been updated over the years, but perhaps the biggest change is happening in 2010. This year, girls are taking their pitches for the $700 million a year business online.

Enabling cookies

Four girls from Troop 30313 cluster around a laptop in troop leader Monique Lazzarini's kitchen. The San Francisco scouts are learning how to market their cookies with eVites, text messages and on Facebook.

They're taking advantage of the fact that, for the first time, the Girl Scouts organization is embracing online cookie marketing.

Eleven-year-old Emily Costanza says she's enjoying the chance to learn about social media. "I feel that everyone should be using this resource," she says. "It's very helpful and it's a very [good] experience for younger children because when they're older they'll know how to use it, and it's a way to have fun with technology."

That makes Laurel Richie, chief marketing officer for the Girl Scouts of the USA, happy. "I love the fact that we're moving from door-to-door to online because it says that we're really in touch with girls today," she says.

Leadership for the 21st century

The century-old girls' organization promotes cooperation and leadership. Richie says, whether the girls are selling cookies in person or marketing them online, the important thing is they're coming up with plans and executing them.

"We've been hearing all kinds of things," she says. "I almost can't think of a media outreach vehicle that isn't being used. We have 2.6 million Girl Scouts across the country; there are probably 2.6 million different little marketing plans for the cookie program."

This official enthusiasm for digital marketing wasn't apparent last year when a young Girl Scout in North Carolina posted a simple video on YouTube to pitch her cookies. The organization called the video a violation of its rules, and the scuffle over the 8-year-old's viral effort became a national story.

Richie says the girl's safety was the main concern. "So we just took a moment to breathe and to make sure we could find a way to meet their desire to market online with our desire to make sure they do it in a way that is safe."

Staying safe online

The organization worked with Microsoft to develop a safety program for their scouts.

Ten-year-old scout Natalie Guitierrez ticks off some of the points. "Don't show your picture, don't tell your last name, you don't want anyone to come find you, which is really bad. Don't tell them your phone number." She knows that people are not necessarily what they seem online. "If they say, like, 'It's safe, I'm OK, I'm a doctor or something,' they might be lying."

Laurel Richie says a new Girl Scout pledge to be careful on line incorporates those ideas, and is just as important as teaching girls the technologies themselves.

The kids are doing their work online supervised by troop leaders and sometimes, parents. Parents who are getting busier by the day welcome technological help for cookie sales.

Marina Park, who heads the Girl Scouts program in Northern California, says it's been hard to find parents with the time to volunteer with the group, let alone do cookie sales door-to-door. "If the parents are working, you really don't want [to be] walking your kids after dark when there's homework to be done and dinner to be made," she says. "It really simplifies the whole thing."

Sweet success

The new marketing technique seems to be having an effect on sales. At the group's national office, Laurel Richie says she's been hearing that this has been an impressive selling season around the country. Troop leader Lazzarini says her girls have sold two to three times as many boxes as they had by this time last year.

Marina Park says advanced sales have gone up 9% across Northern California. "That's a significant change, particularly because by and large, cookie sales have been flat to declining nationwide for some time, and so to see a big uptick like that is pretty significant."

And pretty important, too. The money raised from cookie sales helps train troop leaders, improve camp sites and offer financial assistance to make Girl Scouts activities available to all girls who are interested.

But if for some reason the online sales don't work out, there's always the old tried and true approach — selling in person.

16 March 2010

'Alice' Extends Her No. 1 Stay with $62 Million

LOS ANGELES (AP) — Alice is still ruling the movie palace.

Johnny Depp and Tim Burton's "Alice in Wonderland" easily remained the No. 1 weekend draw with $62 million, according to studio estimates Sunday. The Disney fantasy has climbed to a $208.6 million total domestically, becoming the first $200 million hit released this year.

In its second weekend in theaters, "Alice in Wonderland" pulled ahead of the $206.5 million domestic haul of "Charlie and the Chocolate Factory" to become the top-grossing of Depp and Burton's seven films together, which include "Edward Scissorhands," "Sweeney Todd" and "Corpse Bride."

"I believe it's literally the magical, if you would, pairing of Tim and Johnny," said Chuck Viane, head of distribution for Disney. "When you take those two, they always seem to make something really out of the ordinary."

"Alice in Wonderland" added $76 million overseas to bring its international total to $221 million and its worldwide gross to $430 million.

A rush of new movies had so-so openings, led by Matt Damon's Iraq War thriller "Green Zone," which debuted at No. 2 with $14.5 million domestically. Released by Universal, "Green Zone" stars Damon as the leader of a U.S. Army team who stumbles onto a conspiracy over the search for weapons of mass destruction in Iraq.

Paramount's romantic comedy "She's Out of My League" debuted at No. 3 with $9.6 million. The movie stars Jay Baruchel as a geek in an unlikely romance with a babe.

"Twilight" star Robert Pattinson's romantic drama "Remember Me" opened at No. 4 with $8.3 million. The Summit Entertainment release stars Pattinson and "Lost" co-star Emilie de Ravin in a dark story of young lovers with tragedy in their past.

In its fourth weekend, Paramount's "Shutter Island," the latest collaboration between Leonardo DiCaprio and Martin Scorsese, was No. 5 with $8.1 million, raising its domestic total to $108 million.

Debuting at No. 6 with $7.6 million was Fox Searchlight's comedy "Our Family Wedding," starring America Ferrera as a Hispanic bride marrying a black man.

"Alice in Wonderland" took in nearly as much as the rest of the top-10 movies combined.

"It's like this great divide between the No. 1 and 2 films, which says that without `Alice in Wonderland' in the marketplace, we'd be hurting right now," said Paul Dergarabedian, box-office analyst for Hollywood.com. "By itself, it's really propelling huge box office."

Hollywood's business soared, with overall revenues at $144 million, up 43 percent from the same weekend last year, when "Race to Witch Mountain" led with a $24.4 million debut.

For the year, revenues are at $2.24 billion, up 9 percent compared to receipts last year, when Hollywood took in a record $10.6 billion.

Factoring in higher admission prices, movie attendance this year is running 6.7 percent ahead of 2009's, according to Hollywood.com. Before "Alice in Wonderland" opened, attendance was lagging slightly behind last year's.

"In just a couple of weeks, `Alice' has turned the entire marketplace around almost single-handedly," Dergarabedian said.

James Cameron's science-fiction sensation remained a strong draw after nearly three months in theaters, taking in $6.6 million to raise its domestic total to $730.3 million. The 20th Century Fox release has topped $2.6 billion worldwide.

Summit Entertainment's "The Hurt Locker," which beat "Avatar" for best picture at the Academy Awards, got a slight box-office bump from its Oscar triumph. The Iraq War drama, which is out on DVD but came back to theaters for Oscar season, pulled in $828,000, raising its box-office total to $15.7 million.

Estimated ticket sales for Friday through Sunday at U.S. and Canadian theaters, according to Hollywood.com. Final figures will be released Monday.

1. "Alice in Wonderland," $62 million.

2. "Green Zone," $14.5 million.

3. "She's Out of My League," $9.6 million.

4. "Remember Me," $8.3 million.

5. "Shutter Island," $8.1 million.

6. "Our Family Wedding," $7.6 million.

7. "Avatar," $6.6 million.

8. "Brooklyn's Finest," $4.3 million.

9. "Cop Out," $4.2 million.

10. "The Crazies," $3.7 million.

15 March 2010

Court OKs TV Rules Opposed by Comcast, Cablevision

WASHINGTON (AP) - A federal court Friday upheld regulations that require cable TV companies to make sports programming and other channels they own available on equal terms to rival TV providers such as satellite companies.

The ruling by the U.S. Court of Appeals for the District of Columbia leaves in place the Federal Communications Commission "program access" rules, which are intended to ensure that cable companies cannot withhold highly desirable programming that they own from competitors.

The rules require Comcast Corp., for instance, to make channels that it owns - including E! Entertainment, Versus and the Golf Channel - available to rivals such as DirecTV Inc., Dish Network Corp., AT&T Inc.'s U-Verse video service and Verizon's FiOS video service.

The decision was a setback for Cablevision Systems Corp. and Comcast, which were challenging the FCC's decision to extend a ban on exclusive programming contracts for five years.

Comcast has nonetheless pledged to extend the program access rules to the local NBC and Telemundo stations it would control as part of its proposed combination with NBC Universal. Comcast is seeking FCC and Justice Department approval to buy a 51 percent stake in NBC Universal from General Electric Co.

Comcast said it was disappointed in Friday's ruling.

"The program access rules are based on an outdated and obsolete view of the competitive landscape," Cablevision said in a statement.

DirecTV and Verizon hailed the ruling as a win for consumers.

"This decision protects consumers' ability to view the programs they demand as they gain new choices among video providers," Verizon said in a statement. The phone company has spent billions on its new FiOS fiber-optic network to deliver video and high-speed Internet services.

The circuit court decision comes amid growing concern in Washington about the rules governing access to both broadcast programming and channels owned by cable companies.

On Sunday, after talks broke down between ABC and Cablevision over the fees the cable company would pay to air the network, the ABC station in New York pulled its signal from Cablevision, causing subscribers to miss the first 15 minutes of the Oscars. A coalition of cable, satellite and phone companies seized on the incident to ask the FCC to prohibit broadcasters from interrupting signals during negotiations or before popular events, and to mandate binding arbitration.

FCC Chairman Julius Genachowski told lawmakers at a hearing Thursday that the FCC would review whether existing federal regulations still make sense.

Friday's ruling is the second key victory for cable rivals in as many months when it comes to program access rules.

In January, the FCC voted to close to the so-called "terrestrial loophole," which lets cable companies get around program access rules by distributing programming over landlines rather than satellite connections.

Comcast, Cablevision and Cox Communications Inc. have relied on the loophole to deny sports programming to competitors such as DirecTV, Dish, AT&T and Verizon.

Genachowski praised Friday's ruling. "The commission's program access rules have played a vital role in making diverse and attractive video programming available to cable and satellite TV viewers," he said in a statement.

14 March 2010

Revenge of the Cable Guy

Business Week

If you think online TV will be free forever, think again. The cable companies have a plan to keep control—and stick you with the bill

Once upon a time, not so long ago, a bunch of small companies in Silicon Valley thought the future of television was theirs. Soon, the thinking went, TV would be everywhere. Frequent fliers would tune in on laptops and vacationers on tablets from the beach. If so inclined, you'd be able to watch Glee on a cell phone in a tree house. The network suits and the cable guys just didn't have the digital chops to make it happen. Fueled with venture money, tech companies with names like Boxee, Roku, and Sezmi pursued their dream of untethering viewers from their TV sets—and owning a piece of the advertising revenue.

As the big picture comes into focus though, it looks like the cable guys are playing the lead roles, using the $32 billion they pay content providers each year as leverage. The alphabet soup of newbies is still waiting in the wings for a moment that might never come.

What happened? Part of the answer is TV Everywhere, a service in its infancy, conjured up in quiet strategy sessions by Jeff Bewkes and Brian Roberts, the CEOs of Time Warner (TWX) and Comcast (CMCSA). They took a lesson from the music labels, which looked up one day to find that Steve Jobs and Apple (AAPL) had taken control of their inventory. The cable guys came up with a quick fix, one so technologically simple that you don't have to be a geek to get it: Viewers can watch shows for free, but only if they're cable subscribers first. In other words, as long as you tap a subscription code into your device—any device—you can watch anything you want, whenever you want.

It's worth hitting pause here for a moment. Right now, Time Warner is offering the service in only a few markets. Comcast has rolled out a trial, or beta, version to about 80% of its subscribers. There are plenty of kinks to be sorted out. And as usual when it comes to show business, nothing is quite as simple as it appears. For TV Everywhere to work, the behemoths of the business must stand together and stamp out the rampaging weed called free. After all, if you can get programing for free—real free—why would you ever pay a cable bill?


That's what was worrying Time Warner's Bewkes in the fall of 2008. Back then, Time Warner ran the country's second-largest cable operator (spun off in March 2009) and was also a content provider. Bewkes had previously been in charge of the company's HBO unit, turning the premium cable channel into a profit machine with 30 million subscribers.

Bewkes watched with growing alarm as Hollywood stampeded online to offer TV shows and movies for free, say two Time Warner executives. At the time, Hulu, a video site operated by Fox (NWS), NBC Universal, and Disney, (DIS) was about a year old. For TV addicts, Hulu was a near miracle. Miss the latest episode of Damages on the FX channel? If so, you could watch Glenn Close play a conniving lawyer on Hulu 24 hours later for free. Hulu's owners shared the advertising revenue from the site, but everyone knew it wasn't making money and there was no clear path to profitability. As he watched one entertainment company after another put their TV shows and movies online for free, say the executives, Bewkes began to fear that the pay TV industry would eventually find itself in the same untenable position as newspapers.

That's when the scene shifts to Wisconsin, where HBO was running an experiment in Milwaukee and Green Bay. HBO was letting people watch its programing online as long as they could prove they were HBO subscribers.

The results of the test were unexpected: Viewers who tuned into Big Love on their laptops didn't spend any less time watching HBO on their TV sets. Bewkes was buoyed by the possibility that the same model might work more widely and that his cable properties might be able to keep subscribers from gravitating elsewhere, says a Time Warner executive involved in the discussions. Bewkes told his team: "We can't just talk about it, or play the victim. We need to build a model," the executive recalls. The Time Warner CEO was unavailable for comment.

It wasn't the first time the cable industry had found itself in danger of being outflanked by tech-savvy rivals. In 1999, TiVo began selling a handy little box that allowed people to record dozens of hours of TV shows on a hard drive. After a certain amount of handwringing, the cable guys struck back with overwhelming force. They figured out the technology and marketed their own digital video recorders, for which they charged subscribers an extra $10 or so a month. Next came Apple. Along with Amazon.com (AMZN) and others, Steve Jobs began renting TV shows online. The cable companies beat back that onslaught by beefing up their video-on-demand offerings and giving subscribers a bunch of free shows with a few clicks of the remote. "The cable industry has been very good at not jumping too early on a technology, and watching it play out first," says Colin Gounden of Grail Research, which advises companies on new products. "They have a knack for getting the timing right."

The new attack from Silicon Valley was the most serious yet, because it threatened to permanently cut the coaxial connecting the cable companies and their subscribers. "We wake up every day and there is some new competitor out there—a Roku or a Boxee," says Melinda Witmer, Time Warner Cable's programming chief. "People like to think of cable operators as monopolists, but we face a lot of competition just to keep the business we have." Technically there was nothing too complicated about Bewkes' plan to expand the Milwaukee experiment.

The new service would need a way to automatically confirm that people were paid-up subscribers. Other than that, TV Everywhere, as Bewkes called it, would mostly use existing online infrastructure and established user interfaces.


Far more daunting was the prospect of persuading the rest of the industry to join up. Unless most of the pay TV and content players banded together, TV Everywhere wouldn't work; viewers could simply flock to sites that didn't require a cable subscription. Bewkes, say two Time Warner executives, decided to float his proposal with Roberts, the chief of Comcast, the largest cable system in the U.S., with 24 million subscribers. In early 2009, Bewkes began wooing Roberts, traveling from his New York City office on Columbus Circle to Comcast's imposing 57-story headquarters in Philadelphia.

Roberts long ago realized that online video was important to the future of his company. In 2006, Comcast had created an interactive media unit that poached heavily from Silicon Valley. The company's first major development project was Fancast, a video site like Hulu that offered hundreds of shows free to all comers. Roberts, who declined to be interviewed for this story, had unveiled Fancast at the Consumer Electronics Show in Las Vegas in early 2008. Before long, says one Comcast executive, he began thinking about a service that would offer much more content—but only to Comcast subscribers. When Bewkes came calling he didn't have to convince Roberts of the importance of preserving the subscription model online. And like most everybody in the cable industry, Roberts was aware of HBO's online experiment in Wisconsin.

Roberts and Bewkes initially disagreed on one big point, say two Time Warner executives who say they can't speak on the record because the discussions were sensitive.

Roberts believed subscribers should be required to go to a central site operated by their pay TV provider in order to view cable shows. Bewkes, true to his divided soul as a content creator and distributor, felt users should be allowed to tap into any cable channel's Web site as long as it was part of the TV Everywhere ecosystem. Bewkes, say the executives, reasoned that letting individual channels keep their own sites would allow them to maintain their brands. Eventually, Roberts agreed.


The Time Warner executives say Roberts and Bewkes saw the cable industry's annual convention, held last April in Washington, D.C., as an opportunity to proselytize about TV Everywhere to the rest of the industry. During one panel discussion, Roberts told his audience that online video was "a friend, not a foe" and that for Hollywood it represented a new way to make money "in this horrific advertising environment."

In Hollywood, studios and cable channels were hearing a very different message from the Silicon Valley upstarts who wanted to cut deals for their programing. Netflix's (NFLX) Ted Sarandos pushed studio executives to give his company the latest movies for its online video service. Steve Jobs proposed launching a stripped-down cable service that would cost consumers $30 a month. Boxee founder Avner Ronen says he traveled to Los Angeles from his base in New York so many times that his "plane knew the way."

Phil Wiser, founder of Sezmi, an online TV subscription service, says his goal was simple: to "replace cable and satellite." He flew executives from NBC Universal, Sony (SNE), the Discovery Channel, and others to Sezmi's offices in a converted horse barn in Northern California, where he wined, dined, and pitched them. Sezmi wanted the content creators to allow him to use their movies and TV shows for an à la carte service that would give customers the freedom to pay for only what they wanted to watch. The studios declined, so he decided to borrow the industry's subscription model. Owners of Sezmi's $299 set-top box would receive network and cable shows for $19.99 a month, about a third the cost of a typical cable subscription.

Wiser told the studios that he would match what cable was paying for episodes of such shows such as The Real World, Top Chef, and Damages. It was an unprecedented offer for a startup, but only one company initially agreed to make its content available: NBC Universal, which is already available on Hulu. Wiser says it took another 18 months to lure more content providers, including Turner Broadcasting (TWX) (owned by Time Warner) and Discovery Networks. What's more, Wiser acknowledges he had to pay the content guys more than they get from the big cable companies. When Sezmi boxes went on sale in Los Angeles in February, the service was missing ESPN, The History Channel, The Food Network, HBO, and other popular channels. "Trying to do this is not for the faint of heart," says Wiser, a former Sony (SNE) executive. "These firms see dozens of new pitches every week, so they're skeptical."

Skeptical—and satisfied. The makers of movies and TV shows are attached to the billions they receive from cable companies and are understandably reluctant to engage in grand experiments with upstarts touting unproven business models. Joshua Sapan runs Rainbow Media Holdings (CVC), which controls AMC, IFC, the Sundance channel, and others. He says tech companies have approached him about licensing AMC shows, but, he asks: "Why would I license my channel to someone and give them Mad Men the day after it shows up on AMC?"

Back at Time Warner Center in New York and One Comcast Center in Philadelphia, the cable operators began to realize they had the studios locked down. As Frank Biondi, former president of the media giant Viacom (VIA), puts it: "Why would [the studios] make a deal with a competitor to their largest customer and risk angering them?"

In summer 2009, Bewkes and Roberts joined forces to take the TV Everywhere model out for a spin with 5,000 Comcast subscribers across the country. Those viewers were able to tap into programing provided by cable channels TNT and TBS, both owned by Time Warner. The speed with which the industry moved on from that trial balloon is a measure of just how important locking in subscriber revenue is to cable's future. In December, Comcast rolled out a beta version of the new service, now christened Fancast XFinity TV. Time Warner Cable has a trial going with nearly 10,000 customers in Syracuse, N.Y., New York City, and Columbus, Ohio. Verizon Communications (VZ) is testing a service nationally, and DirecTV, the satellite operator, plans to as well.

Comcast's service is the furthest along and provides a window on where TV Everywhere is headed. Only subscribers who pay for digital cable—and take Comcast's broadband service—are eligible. (The company is still working out how to bring XFinity TV to the third of its subscribers who get broadband from other companies.) Subscribers can tune into two dozen channels, from CBS to Animal Planet, and view 19,000 full-length TV shows and movies. They can use it on as many as three PCs and get most episodes 24 hours after they first air on TV. Much of that was available on Comcast's free site, but now shows on HBO and the Discovery channel have been added to the lineup. Eventually, Comcast aims to let subscribers access XFinity on their smartphones and tablets.

TV Everywhere has a ways to go before the cable guys can declare victory. There's a ton of stuff to figure out—how the ad model will work, devising a new ratings system with Nielsen. And then there's the question of profits. The cable guys like them, and they're not real comfortable with free. So chances are, down the line, the costs of the new free will probably sneak onto subscribers cable bills. And you know what? We'll all keep paying.

13 March 2010

Feds Pledge Tough Review of Comcast-NBC Deal

WASHINGTON (AP) - Federal regulators are pledging rigorous reviews of Comcast Corp.'s proposed purchase of NBC Universal to ensure that it would not stifle competition or harm consumers.

Christine Varney, the Justice Department's antitrust chief, and Julius Genachowski, chairman of the Federal Communications Commission, offered no indication at a hearing Thursday of what the outcome of those reviews could be.

But many lawmakers and industry analysts expect regulators to approve the deal with conditions to prevent a combined company from abusing its market power.

At Thursday's Senate Commerce Committee hearing, lawmakers expressed concern about the dangers of allowing the nation's biggest cable TV and broadband company to take control of NBC's vast media empire.

"When consolidation occurs in these markets, we need to pay attention," said Commerce Committee Chairman John D. Rockefeller, D-W.Va. "When companies swell to include both content and distribution, we need to pay attention. Because it is vitally important that when we have mergers in these markets, consumers cannot be left with lesser programming and higher rates."

Comcast is seeking government approval to acquire a 51 percent stake in NBC Universal from General Electric Co. Comcast already owns some cable TV channels, including E! Entertainment and the Golf Channel. NBC Universal owns the NBC and Telemundo broadcast networks, along with popular cable channels such as CNBC, Bravo and Oxygen and the Universal Pictures movie studio.

The Justice Department will focus its review on the antitrust implications of the deal, while the FCC will look at whether the transaction is in the public interest. The FCC will soon begin accepting public comments to help guide its analysis. Both reviews are expected to last all year or longer.

Sen. John Kerry, D-Mass., called on Varney and Genachowski to ensure that Comcast won't be able to extract higher prices from rival cable TV, satellite, phone and Internet companies for access to its popular video programming - in turn driving up prices for consumers.

That issue is drawing attention in Washington this week after a dispute over fees that Cablevision Systems Corp. pays to carry the ABC station in New York caused Cablevision subscribers to miss the first 15 minutes of the Oscars on Sunday.

A number of cable TV and satellite companies have seized on the incident to ask the FCC to prohibit broadcasters from pulling signals during negotiations and to mandate binding arbitration. Genachowski told senators on Thursday that the FCC would review whether existing federal regulations still make sense.

Kerry also urged regulators to ensure that Comcast won't lock up video programming on the Internet by making it available only to cable TV subscribers.

Comcast Chairman and CEO Brian Roberts told the committee that the combination would benefit consumers and drive innovation by accelerating "the delivery of the 'anytime, anywhere,' multi-platform video experience Americans want."

He added that the transaction would not reduce competition because "there is no significant overlap between the assets of the two companies."

12 March 2010

Facebook Threatens Suit Against Daily Mail

Guardian UK
Social networking site fears reputation permanently damaged by false claim that it let older men pressure teenage girls for sex

Facebook has threatened to sue the Daily Mail for damages after the paper wrongly claimed in a piece published on Wednesday that 14-year-old girls who create a profile on the social networking site could be approached "within seconds" by older men who "wanted to perform a sex act" in front of them.

The paper apologised in print today and online yesterday for the error, which the author of the piece, Mark Williams-Thomas, insisted had been introduced by editors at the paper despite being told it was wrong. In fact, Williams-Thomas – a retired policeman who now works as a criminologist – had been using another, unspecified social network.

But the giant social networking site, which has 23 million users in the UK alone, said that although the Mail has changed the headline of the article online – so that it now reads "I posed as a girl of 14 online. What followed will sicken you" – it had not at first changed the page title of the article online, used by internet search engines to index content, nor the URL of the piece, which is also a factor in search-engine indexing.

At 10am today the title still read "I posed as a girl of 14 on Facebook. What followed will sicken you" while the URL contained the text "i-posed-girl-14-facebook-what-followed-sicken-you". The title and URL were, however, amended before noon.

A UK spokeswoman for Facebook said the company was still considering legal action and looking at the "brand damage that has been done".

Charles Garside, assistant editor of the Daily Mail, said that the apology had been produced in consultation with Facebook, and that representatives of the paper and Facebook would be meeting today. The changes to the URL and page title were "a technical matter", he said, adding: "We are removing elements of that".

The incorrect naming of Facebook is understood to be blamed on "a matter of miscommunication".
Facebook staff claimed that attempts to add a comment to the piece, as readers are able to do, were repeatedly blocked by the Daily Mail.

The company is concerned that the article may have done permanent harm to its reputation in the UK. "If you were a Middle England reader and your child was on Facebook, this sort of thing would have a very serious effect on what you thought of us," said the Facebook spokeswoman.

Tensions over Facebook's position in the UK as a popular site among people of all ages, allowing them to contact each other, have been magnified in the past week after Peter Chapman was convicted of murdering Ashleigh Hall, a 17-year-old girl who thought that Chapman, 33, was also a teenager. Chapman had got in touch with Hall via Facebook, leading to criticisms from some senior police officers over the measures that the site takes to protect susceptible individuals .

But the Daily Mail piece, which carried Williams-Thomas's byline, suggested that anyone who signed up as a 14-year-old girl would be approached "within minutes of the profile going up". The piece also said that "messages from men poured in" and that "the first three who approached me were aged between 20 and 40".

However, Williams-Thomas and his agent, Sylvia Tidy-Harris, both insisted on their Twitter feeds that he had not used Facebook for the Mail article.

It "was on another well-known SNS [social networking service], not Facebook", said Tidy-Harris, echoing Williams-Thomas.

Tidy-Harris said that yesterday had "Been a hellishly tough day trying to juggle @mwilliamsthomas misquote in daily mail along with meetings and literally 100ks of calls/emails".

At Facebook, the anger at the misrepresentation was magnified because, they say, they were initially unable to get any response from the paper to their appeals for corrections.

"The people at Facebook in the US were reading this and knew at once that it couldn't have been our platform," said the Facebook UK spokeswoman. "We have made Facebook much more favourable to the safety of minors – minors under 18 cannot receive messages from somebody over 18."

That means it would be impossible for the scenario described by Williams-Thomas to happen on Facebook.

Facebook's representatives said that they tried to get a response from the Mail throughout Wednesday without success, and that attempts by people at its PR agency to post comments on the piece with clarifying text failed. The Mail uses moderators who on that story approved comments before they could appear. By this morning the article had 380 comments.

Williams-Thomas has not responded to requests to specify which social networking service he was using by the time of publication.

Why Pro Athletes Love Toronto

The Wall Street Journal

Chic, Discreet and Increasingly Party-Filled, Canada's Sports Hub Permits Jocks to Cut Loose  

American pro athletes used to think of Toronto as a backwater. High taxes and low temperatures combined with a woeful lack of television exposure back in the States made playing here about as appealing as Canada's national dish of french fries soaked in gravy and cheese curds.

B.J. Armstrong, the first expansion-draft pick of the NBA's Toronto Raptors, famously asked to be traded shortly after setting foot here for the first time.

Today, however, Toronto is a road trip just about every pro athlete looks forward to. Some say the city has a cool, international vibe that increasingly stands out. Some like the plentitude of cheap concert tickets—a boon for athletes with big posses—or the convenience of the must-be-19 drinking law. (Rookie guard DeMar DeRozan of the Raptors, who is 20, was ordering chocolate milk at dinner before his teammates told him the good news).

Athletes get a warm welcome at the city's relatively libertine gentlemen's clubs which, according to a spokeswoman for the Toronto Convention and Visitors Bureau, tend to "clear out the champagne room" for visiting athletes. And it helps that the tentacles of the tabloids and gossip Web sites rarely extend this far into the frozen north. "People like to come here to party," says Raptors power forward Chris Bosh.

Basketball stars like LeBron James and Shaquille O'Neal of the Cleveland Cavaliers and Jamaal Magloire of the Miami Heat (a Toronto native) have come to Toronto for fun—even during the NBA offseason. Since the Buffalo Bills began playing annual games at Toronto's Rogers Centre (formerly SkyDome) in 2008, an increasing number of NFL players have started passing through "the 416," which is the city's area code. Baseball players, who've been coming here since 1977 to play the Blue Jays, have good memories.

"It reminds me of Tokyo," says Hideki Matsui, the Angels' new designated hitter, who many years coming to Toronto with the New York Yankee. Going out with his teammates was always a relief, he says, because "the attention level is not as bad as New York—though being a pretty big-sized Asian person there are a few people who recognize me."

Though it may not have more bars and clubs than other pro sports towns, many of Toronto's 3,300-plus establishments holding liquor licenses are concentrated within walking distance of the city's major sports venues—and close to the hotels where athletes tend to stay. Five new five-star hotels are expected to open in the area in the next two years.

When the sun sets in Toronto and the roof of the Rogers Centre starts to glow like giant spaceship, the downtown club district—once a quiet industrial stretch of garment factories—begins to teem with life. Strolling the streets from bar to bar are well-dressed revelers of all ethnicities.

Jarrett Jack, a Raptors guard, says the "mix of people" in Toronto is far more interesting than he sees in most NBA towns. "One girl told me she's from Hungary and Chile—I'm like, how does that happen?" says Mr. Jack. "You kind of go outside the box here."

"There are certain cities you go to where you want to get there a day ahead and give (the players) a chance to have their fun—and Toronto has become one of those cities," says Raptors assistant coach Alex English.

At the center of much of the city's athlete nightlife is an event planner and promoter named Mona Halem, a former employee of the Air Canada Centre, which is home to the Raptors. Ms. Halem has become "notorious" throughout the sports world, says Raptors forward Antoine Wright, for assembling attractive party guests to fete nearly every franchise that comes to town.

Last week, around midnight, not long after they'd checked into their hotel, several members of the New York Knicks put on expensive sweaters and hailed cabs to Tattoo Rock Parlour, a club in the city's "Queen West" neighborhood.

Knicks rookie Toney Douglas, who was descending the hotel elevator in a sparkling diamond necklace and a puffy vest, said he never goes out before games and isn't a fan of cold weather, but had heard from friends that Toronto, "party-wise," was one city worth making an exception for. "It's something different – it's another country," he said.

Ms. Halem, who owns a company called Lady Luck Entertainment, holds a math degree from York University and is better known to local athletes as "the boss," was hosting a party there that she'd been promoting for weeks on Facebook as "New York Meets Toronto."

Inside the club, Ms. Halem made the rounds, greeting players and making introductions. The guests of honor chatted and danced until the early morning— except for Knicks shooting guard Tracy McGrady, who left early, pronouncing Toronto "a great town" on his way out the door. The Knicks fell the next day to the Raptors 102-96.

Toronto's resident athletes say they can't go nuts on the town like their friends on visiting teams—for one thing, they're far more recognizable, and for another, the scene gets old. "It's pretty much the same people every time," says Mr. Bosh, adding that he gets "hounded" everywhere he goes.

The popularity of these parties—some athletes say they've cancelled appearances and forfeited thousands of dollars in fees to attend them—has made Ms. Halem a known entity throughout sports.

Darren Sanders, the director of security for the Baltimore Ravens—a team that hasn't even played in Toronto—says his team was told recently about the growing popularity of Toronto among athletes, and about her role in making it so. "She is definitely on the radar," he says.

This city used to be decidedly off the sports radar. The Raptors struggled mightily until the 1998 arrival of now-Orlando Magic forward Vince Carter, who helped the team set league attendance records and led it to the playoffs three years in a row. Mr. Carter also invested in a local nightclub, spurring fresh interest in the city's nightlife from musicians and other celebrities.

After Mr. Carter's departure, the Raptors struggled again until Bryan Colangelo took over as general manager and overhauled the roster. He discovered that foreign players were more than happy to trade U.S. TV time for the chance to play in a city with one of the largest Italian populations outside of Rome and direct flights to Istanbul and Ljubljana, Slovenia.

Mr. Colangelo says Toronto's growing diversity and relative freedom from paparazzi madness have made it increasingly attractive to American athletes as well. "There are some markets where guys get singled out and that sure doesn't happen here," says Mr. Colangelo. "There's a great relationship between the players and our fans and the people that watch over the city."

11 March 2010

Pink Floyd, Queen May Leave EMI as Guy Hands's Buyout Mission `Implodes'‏

Bloomberg News

Pink Floyd, Queen May Ditch EMI as Buyout ‘Implodes’
Pink Floyd and Queen, bands that have been with EMI Music for about four decades, may head for the door, according to two people familiar with their talks, as concern mounts about the U.K. record label’s finances.

Pink Floyd, whose catalog includes such albums as “Dark Side of the Moon” and “The Wall,” and Queen, with its best- selling single “Bohemian Rhapsody,” have met with other major record labels about leaving, said the people, who spoke on condition of anonymity because the discussions are private.

Guy Hands, whose Terra Firma Capital Partners Ltd. bought EMI for 4 billion pounds ($6 billion) at the height of the buyout boom in 2007, has until June to convince the firm’s investors to inject new capital to keep EMI afloat. Without that funding, EMI may end up in the hands of creditor Citigroup Inc. and may merge with a rival, analysts said.

“This is how a company implodes,” said Claire Enders, a former EMI executive and the head of Enders Analysis Ltd., a London-based music and entertainment research firm. EMI rivals Universal Music Group, Sony Music Entertainment and Warner Music Group Inc. are likely courting the label’s top artists such as Lily Allen and Katy Perry, she said.

Adding to the turmoil, Hands is suing Citigroup, saying the bank tricked Terra Firma into buying EMI in 2007. The company also today said EMI Music Chief Executive Officer Elio Leoni- Sceti will step down effective March 31. It asked 53-year-old Charles Allen, currently non-executive chairman, to assume the role of CEO.

Under Pressure

In a letter to Hands, part of court documents filed Feb. 4 in New York, Leoni-Sceti had written that morale at the company had reached a low and that artists were questioning whether to stay.

EMI is in talks with artists, “all of whom are questioning to some degree whether it is wise to continue a relationship with EMI,” Leoni-Sceti wrote in the Oct. 2 letter, saying their concerns were sparked by a Citigroup report on EMI’s prospects. Hands had named Leoni-Sceti to the top job in July 2008 with no music industry experience.

Neil Bennett, a spokesman for EMI, the world’s fourth- largest record company, declined to comment for this story.

Mark Fenwick, the manager for Pink Floyd, declined to discuss the contract with EMI. The group, which first signed with the label in 1967, last year sued EMI and Terra Firma for what it said were miscalculated royalty payments. At a hearing in London yesterday, the band’s lawyer argued for royalties on online and single-track sales.

Jim Beach, the manager of Queen, declined to comment on plans for its EMI contract. Queen signed with EMI in 1972.

Disappearing Revenue

Pink Floyd’s exit may be especially painful for EMI because of the loss of future sales of the band’s works, such as the still-popular 1973 album “Dark Side of the Moon.”

“That’s just a constant revenue stream that would suddenly disappear,” said Larry Kenswil, a music industry attorney for Loeb & Loeb in Los Angeles.

OK Go, a rock band that has criticized EMI over the availability of its videos online, announced today that it has left the label to create its own company called Paracadute.

EMI’s management style since Hands took over sparked outbursts from several top artists, including Lily Allen and Joss Stone. Industry executives have accused Hands of running the label like a hedge fund rather than a creative shop.

Terra Firma’s acquisition of EMI Group Ltd. just weeks before the credit markets collapsed in 2007 was the firm’s largest. Hands started the firm in 2002 raising 2.1 billion euros ($2.9 billion) for investments such as the German rest- stop chain Autobahn Tank & Rast Holding GmbH.

Artistic Differences

Radiohead and the Rolling Stones abandoned EMI when Hands took over, and as contracts with Pink Floyd, Queen and Robbie Williams come up for renewal, EMI faces the prospect of one or all leaving.

EMI Grammy Award winner Joss Stone last month asked on her Web page, “What manager will want their band signed to a company which might not exist in its current form in a year’s time?”

“The mistake Hands made is basically coming into a business he didn’t fully understand,” said Colin Lester, who signed the Arctic Monkeys and Travis and manages Grammy Award- nominated Craig David. “It’s important to have relationships with artists and it’s not based on the same matrix as other businesses.”

EMI, home to the Beatles, last month posted a 1.5 billion- pound annual loss and said its liabilities exceeded assets by 408 million pounds as of March 31, 2009. Terra Firma has asked EMI for a new business plan and needs the approval of 75 percent of investors to put more capital in by end-June.


Back to Warner?

Speculation that Warner Music Group will bid for the U.K. music company has also heated up. Should EMI breach debt covenants, Citigroup could take control of the company and sell it to Warner Music. New York-based Warner Music made way for Hands to buy EMI after abandoning a takeover in July 2007. On Feb. 9, Warner Music Chief Executive Officer Edgar Bronfman Jr. said regulatory hurdles shouldn’t prevent his company, the world’s third-largest record label, from buying EMI.

“The current expectation is that EMI will cease to be owned by Terra Firma and Citigroup will take it over and sell it Warner,” Enders said. Amanda Collins, a spokeswoman for Warner Music, declined to comment.

To cut debt, EMI considered selling Abbey Road Studios, where the Beatles recorded most of their songs, only to withdraw the plan last month after a public outcry led to the site being put on a protected list by English Heritage.

Lily Allen, Robbie Williams

“They could have a yard sale and sell the gold records off the wall, but I don’t think that’s going to solve the problem,” said Ted Cohen, a former senior vice president of EMI’s global digital operation.

For artists renegotiating contracts, the lure of a financially sound company such as Universal Music or Sony is obvious, said Jonathan Shalit, who manages Myleene Klass and Jamelia. “It doesn’t take a rocket scientist to figure out that you’d sign with a solid company.”

Lily Allen early last year told The Word magazine she “hated” Terra Firma. “They don’t know how to run a creative business. They are killing us, frankly.”

Robbie Williams’s manager, Tim Clark, who two years ago said Hands behaved like a “plantation owner,” has changed his tune, telling Music Week magazine in February that EMI “really got a grip with things” on its operational side. Clark didn’t respond to messages seeking comment.

‘Period of Flux’

EMI has had some victories. Lady Antebellum, a country band signed to EMI, was this year’s first to sell a million albums in the U.S., according to Nielsen SoundScan. It was the fastest to cross the million-mark since 2005, SoundScan said. EMI has also had 200 new signings globally in the last 18 months, including Cypress Hill and American Voodoo.

Still, Scott Booker, manager of the Flaming Lips, said the cloud over Terra Firma and EMI does influence whether he would advise one of his acts to sign with the label.

“Would I sign to EMI right now? No,” said Booker, who also heads of the Academy of Contemporary Music at the University of Central Oklahoma. “I’d wait to see where the dust settles; there is going to be a period of flux over there. Why get in the middle of that? They just can’t afford to promote and market the same way they used to.”

Changing Hands

EMI’s challenges come against the backdrop of the music industry grappling with declining CD sales amid piracy and a shift in consumer preference for digital downloads. U.S. compact disc sales fell 65 percent from 2000 to 2009, according to SoundScan. Vivendi SA’s Universal Music Group, the world’s largest record label, reported revenue fell 6.2 percent last year to 4.36 billion euros.

EMI’s Leoni-Sceti has said the company’s revenue will rise in the current year, after gaining 4.6 percent in the 12 months ended in March 2009. Earnings before interest, taxes, depreciation and amortization more than tripled to 163 million pounds. EMI has said it sees earnings by that measure rising to 200 million pounds this year.

After buying EMI, Hands changed the management team. Former CEO Eric Nicoli left shortly after Hands bought the company. He was replaced by cleaning-products executive Leoni-Sceti, the former head of Europe for Reckitt Benckiser Plc.

“Hands came with a clear statement of intent to do things differently,” said Mark Mulligan, a music industry analyst at Forrester Research Inc. in London. “Hands and Terra Firma’s principles are very sound and he made some very shrewd moves, but at the same time he reacted just as strongly on what he saw as excesses.”

‘EMI’s Heritage’

Terra Firma in November offered to inject 1 billion pounds into EMI in return for a similar cut in the music company’s 2.5 billion-pound debt held by Citigroup, people with knowledge of the talks said then. Citigroup spurned the offer, saying it would have forced the bank to write off debt without getting equity in EMI.

“My hope is that EMI either gains strength by being able to borrow what it needs or merge with another label,” said Lester, the manager who signed Arctic Monkeys. “The heritage of EMI is important to the music industry.”