06.13.11
David Edwards
http://www.rawstory.com/rawreplay/2011/06/target-forces-employees-to-watch-this-anti-union-propaganda-video
Gawker obtained a training video that Target uses to warn its employees about the danger of joining a union.
The 13-milute video titled “Think Hard Before You Sign” is hosted by Doug and Maria, two actors posing as Target employees.
“We’re a target because we’re a threat to unions,” Doug claims. “The unions that represent grocery store workers.”
“When we take business away from unionized grocery stores that means they need fewer employees,” Maria continues.
“And fewer grocery store employees means fewer union members. And fewer members? Well that’s a problem for the union business. That’s right, I said business. Union business,” Doug adds.
“With a union you no longer have your own voice. Have a great suggestion? You can’t take it directly to your manager. You have to go through the union layers. Need help with a problem? Same thing. Someone else will do the talking for you. And there’s no guarantee you’ll like what they have to say. Guarantees. Guarantees and promises. That’s something else you might hear from a union. Unions often make big promises about wages and benefit increases if the team member will only sign their card. Those are promises they can’t keep,” Maria insists.
“The risk of getting a union with out a vote, big promises that can’t be kept, pressure on guests not to shop at our stores, for all those reasons and a whole lot more please think hard before you sign any card or petition,” Maria concludes.
Showing posts with label Target. Show all posts
Showing posts with label Target. Show all posts
Thursday, June 30, 2011
Friday, March 27, 2009
Starbucks, Costco and Whole Foods team up
http://www.reuters.com/article/domesticNews/idUSTRE52L03920090322
Starbucks, Costco and Whole Foods team up on labor bill
Sat Mar 21, 2009
LOS ANGELES (Reuters) - Starbucks, Costco Wholesale Corp and Whole Foods Market are joining forces to propose alternatives to a bill that makes it easier for workers to unionize but is strongly opposed by U.S. corporations.
The three retail giants said on Saturday they sought a "third way" as big business and labor unions face off over the Employee Free Choice Act, backed by President Barack Obama.
The "card check" legislation would let workers form a union when a majority of employees sign authorization cards. That would change the current practice in which workers usually vote on unionizing, although the bill would leave the election option open for workers to choose.
Passing the bill is a top priority of labor unions, which in November helped Obama win the White House and the Democrats increase their hold on Congress. Unions, which suffered decades of declining membership, argue that elections allow anti-union managers to intimidate and harass employees.
U.S. businesses and investors oppose the legislation, with analysts saying retail names from Wal-Mart to Target would face higher labor costs and greater unionization risks. Wal-Mart said last week it was confident the legislation would be defeated in Congress.
Starbucks, Costco and Whole Foods, which invited other corporations, unions and public interest groups to join them, proposed instead that unions be given more access to meet with workers, stricter penalties for labor violations and a guaranteed right to request secret ballots in all circumstances.
"We believe in and trust our employees, which is neither anti-union nor pro-status quo," said Costco CEO James Sinegal.
The three companies will provide more details of their proposals on Sunday.
"Given the severe economic crisis facing America, it is time to avoid the polarization that has occurred on both sides of this issue, and instead, come together to find a productive approach," said Lanny Davis, an attorney with Orrick, Herrington & Sutcliffe, who was cited in the statement.
(Reporting by Edwin Chan; Editing by Peter Cooney)
Starbucks, Costco and Whole Foods team up on labor bill
Sat Mar 21, 2009
LOS ANGELES (Reuters) - Starbucks, Costco Wholesale Corp and Whole Foods Market are joining forces to propose alternatives to a bill that makes it easier for workers to unionize but is strongly opposed by U.S. corporations.
The three retail giants said on Saturday they sought a "third way" as big business and labor unions face off over the Employee Free Choice Act, backed by President Barack Obama.
The "card check" legislation would let workers form a union when a majority of employees sign authorization cards. That would change the current practice in which workers usually vote on unionizing, although the bill would leave the election option open for workers to choose.
Passing the bill is a top priority of labor unions, which in November helped Obama win the White House and the Democrats increase their hold on Congress. Unions, which suffered decades of declining membership, argue that elections allow anti-union managers to intimidate and harass employees.
U.S. businesses and investors oppose the legislation, with analysts saying retail names from Wal-Mart to Target would face higher labor costs and greater unionization risks. Wal-Mart said last week it was confident the legislation would be defeated in Congress.
Starbucks, Costco and Whole Foods, which invited other corporations, unions and public interest groups to join them, proposed instead that unions be given more access to meet with workers, stricter penalties for labor violations and a guaranteed right to request secret ballots in all circumstances.
"We believe in and trust our employees, which is neither anti-union nor pro-status quo," said Costco CEO James Sinegal.
The three companies will provide more details of their proposals on Sunday.
"Given the severe economic crisis facing America, it is time to avoid the polarization that has occurred on both sides of this issue, and instead, come together to find a productive approach," said Lanny Davis, an attorney with Orrick, Herrington & Sutcliffe, who was cited in the statement.
(Reporting by Edwin Chan; Editing by Peter Cooney)
Tuesday, November 11, 2008
Beast of the Month - August 2008
Robalini's Note: Still a little behind, but catching up...
Beast of the Month - August 2008
Hu Jintao, Chinese President
"I yam an anti-Christ..."
John Lydon (aka Johnny Rotten) of The Sex Pistols, "Anarchy in the UK"
"One World, One Dream"
Slogan of the 2008 Summer Olympics
On August 8, the Summer Olympics will be held in Beijing. It will begin at 8PM, which will make it the eighth hour of the eighth day of the eighth month of the eighth year of the century. (In case you didn't know, eight is considered the luckiest number in China, and the Chinese people are particularly superstitious about it.) When it is, it will be viewed in the korporate media as the final coronation of China as one of the few world superpowers. Like it actually needs one.
It's hard to believe it's been nine years since someone from China has won BOTM, and eleven since Jiang Zemin took home the trophy. Why that's particularly hard to believe is because in the past nine years, China has not gotten weaker, but rather frighteningly stronger.
Want the proof? Just walk down the aisle of your local Best Buy, Target or (of course) WalMart. Try to avoid buying products which aren't made in the People's Republic. Good luck. Freelance writer Sara Bongiorni did that a full year in 2005 with her family. Needless to say, it often turned shopping for even everyday products into an epic journey. Her four-year-old son, despondent over the cool toys and gadgets he was unable to obtain, had this to say about the end of the boycott: "When we can buy China things again, let's never stop." Ms. Bongiorni summed up her dilemma thusly:
"The funny thing about China's ascent is that we, as a nation, could shut the whole thing down in a week. Jump-start a 'Just Say No to Chinese Products Week,' and the empire will collapse amid the chaos of overloaded cargo ships in Long Beach harbor. I doubt we could pull it off. Americans may be famously patriotic, but look closely, and you'll see who makes the flag magnets on their car bumpers. These days China delivers every major holiday, Fourth of July included."
Of course, if China was merely destroying Team USA's manufacturing sector while poisoning kids with lead-filled toys, it would be bad enough. Currently, China is the number two holder of US Treasury securities, ahead of the UK and only trailing Japan. It is number two with a bullet. What this means is that increasingly China will have a major say in the decisions of our political establishment. It's hard to ignore that in the late 80s and early 90s, for all the hysteria that was directed at the evil Japanese empire, they were nowhere near the economic threat to America that China is now, and a fellow democracy to boot as compared to a communist dictatorship. So where are the panic-stricken pop novels like Michael Crichton's Rising Sun over China?
Okay, maybe that's a little over-the-top: China, after all, is no longer a communist dictatorship, it's a capitalist dictatorship. China has a $7 trillion a year GDP when measured in purchasing power parity, second only to the USA. Since 1978, when free market reforms were implemented, it has grown at an annual rate of over 8 percent. This growth has been aided over the last decade by the reacquisition of both Hong Kong in 1997 and Macau and 1999. Hong Kong long has been the world's shining example of free market economics (Milton Friedman gushed about it in his 1980 book Free to Choose) while Macau has surpassed Las Vegas as the world's largest gambling center, and now only Dubai exceeds it as an example of 21st century capitalism on steroids. Meanwhile, China's biggest oil producer PetroChina became the first trillion dollar company in value last November, and Shanghai has become the world's largest cargo port. With all this money flowing to China, talks of reunification with Taiwan can no longer be dismissed as merely a dream.
But China is definitely still an ugly dictatorship. The crackdown on Tiananmen Square may have happened nineteen years ago, but an environment toxic to freedom still is alive and well. When Hu Jintao (The Konformist Beast of the Month) was selected to take over China's presidency in 2002 from Jiang Zemin, there was widespread hope that he would become the nation's Gorbachev, that political freedom would be unleashed by what was suspected to be a closet liberal. This was aided by his close relationship with Premier Wen Jiabao, who is about as close to a populist figure that can be found in the Chinese establishment. Nearly six years later, this has been proven to be a bogus fantasy, a fantasy exposed most blatantly by the continuing suppression of the people of Tibet. Indeed, the recent crackdown on Tibetan followers of the exiled Dalai Lama has become so intense, there has been a heavy push for nations to boycott the Olympic opening ceremonies as protest. Other noted examples of China's continued repression are the persecution of the Falun Gong religious movement, the backing of a ruthless military junta in Burma and its ties to the bloodshed in Darfur via continued support of Sudan.
Some refer to the 2008 Games as the "Genocide Olympics" thanks to these crimes against humanity, and has led to further calls for a boycott, most notably from actress and UNICEF Goodwill Ambassador Mia Farrow, actor and Tibetan activist Richard Gere, director Steven Spielberg and Nobel Peace Prize winner Desmond Tutu. The most in-your-face example of China's continued autocratic style is the nation's crackdown on the Internet, which is already a major hurdle for journalist attempting to cover the Olympic Games. This is despite being lied to repeatedly by China that Internet censorship would be lifted on journalists during the games. (Hard to believe a dictatorship would use deception to land an esteemed multi-billion dollar reward.) According to an International Olympic Committee commissioner: "Had the I.O.C., and those vested with the decision to award the host city contract, known seven years ago that there would be severe restrictions on people being able to enter China simply to watch the Olympics, or that live broadcasting from Tiananmen Square would essentially be banned, or that reporters would be corralled at the whim of local security, then I seriously doubt whether Beijing would have been awarded the Olympics.” The climate of persecution that pervades the Summer Games has been so vast, criticisms of Beijing's toxic smog due to intense air pollution have been almost an afterthought. It appears that for all the talk of open markets leading to freedom, it's going to take longer to achieve Chinese democracy than it has taken Axl Rose to finish his GNR album of the same name.
Over the last eight years, two camps of the GOP have been divided over whether to continue treating China as a trading partner or turning them into an adversary for a Cold War sequel. (These two camps can be referred to as the "Shopping Mall Fascists" and the "War & Oil Fascists" for those keeping score at home.) This division is illustrated in the pro-China positions of both Fox Chairman Rupert Murdoch and Christian televangelist Pat Robertson, both having normally anti-Communist views apparently trumped by their desire to profit in the untapped Chinese market. (Robertson's mammon is particularly telling, as he actually has defended China's forced abortion policy to control population, a step beyond the mere "pro-choice" position of American abortion activists he regularly bashes.) The general results of this debate has led the Bush Team to continue the plunge into transferring dollars into China's coffers while getting any dig into them whenever they can, no matter how petty. One noted example: the April Fools 2001 crash between a US spy plane and a Chinese fighter jet that led to the death of PLA pilot Wang Wei. Immediately, the Bush Administration insisted the incident happened in international airspace (a dubious claim) and demanded the release of the entire crew. (It's hard to imagine that if a Chinese spy plane near US borders caused the death of an American navy pilot, Team USA would immediately release the crew and their plane without investigation.) Ten days later, when the Bush Administration gave a belated and unconvincing apology after an increasingly shrill hysteria swept through the press, China released the crew, but by then the diplomatic damage had been unnecessarily done. Cut to 2006, when a visit by Jintao to the US was littered with snubs that showed a calculated pattern. Among the greatest hits: referring to China as “the Republic of China" (the actual title for Taiwan) during the official White House greeting. Perhaps even worse was granting a Falun Gong anti-China activist press credentials to a joint Bush-Jintao press conference. The press conference was interrupted for three minutes by an angry denunciation of Jintao and China by the activist, something which would've been halted immediately if it was an attack on Bush's failed War in Iraq. Normally, the granting of a press pass is so controlled, only right-wing closet gay prostitutes who sleep at the White House overnight can evade the tight scrutiny, which indicates the Falun Gong supporter's activities were sanctioned by the Bush Administration all along.
Of course, not all battles between China and the US are so minor. Both countries have used bogus excuses to use military weaponry in space, moves that indicate a "Star Wars" may eventually explode between the two nations for control of the Earth's skies. And as PetroChina's rise clearly shows, there is a huge battle already being covertly waged between the two countries over the vast Caspian Sea oil reserves. This covert war may go deeper than most suspect: while 9/11 conspiracy theories mainly focus on the US military, Israel, Saudi Arabia or the UK as the alternative culprit, Gordon Thomas makes the case in the book Seeds of Fire that the terrorist attack was actually a Chinese operation to punish the US and strengthen ties between China and Islamic nations. In particular, the book details the close financial relationship between China and the Taliban before 9/11. (Coincidentally, the Taliban was run from power almost immediately after China was voted into the WTO in November 2001.) That being the case, perhaps the tensions between the US and China will become increasingly overt as China continues to gain power without firing a single weapon.
In any case, we salute Hu Jintao as Beast of the Month. Congratulations, and keep up the great work, Hu!!!
Sources:
Barboza, David. "Macao Surpasses Las Vegas as Gambling Center." New York Times 23 January 2007 <http://www.nytimes.com/2007/01/23/business/worldbusiness/23cnd-macao.html>.
Bodeen, Christopher. "Under Hu, China Tightening Media Reins." Washington Post 21 April 2006 <http://www.washingtonpost.com/wp-dyn/content/article/2006/04/21/AR2006042100951.html>.
Bongiorni, Sara. "A Year Without 'Made in China'." Christian Science Monitor 20 December 2005 <http://www.csmonitor.com/2005/1220/p09s01-coop.html>.
Bongiorni, Sara. A Year Without "Made in China": One Family's True Life Adventure in the Global Economy. Hoboken: Wiley, 2007.
Chin, Larry. "Is the Anglo-American Empire Losing the 'Great Energy Game'?" Online Journal 8 January 2007 <http://onlinejournal.com/artman/publish/article_1612.shtml>.
"China's Hu Vows to 'Purify' Internet." Reuters 24 January 2007 <http://www.reuters.com/article/idUSPEK9570520070124>.
"Dalai Lama: China Causing 'Cultural Genocide'." CNN 17 March 2008 <http://edition.cnn.com/2008/WORLD/asiapcf/03/16/tibet.unrest>.
Eimer, David. "China Earthquake: Superstition a Potent Force." London Telegraph 24 May 2008 <http://www.telegraph.co.uk/news/worldnews/asia/china/2021715/China-earthquake-Superstition-a-potent-force.html>.
"The Genocide Olympics?" Washington Post 14 December 2006.
Harnden, Toby. "Outrage as Preacher Refuses to Condemn Chinese Abortions." London Telegraph 20 July 2001 <http://www.telegraph.co.uk/news/worldnews/1316790/Outrage-as-preacher-refuses-to-condemn-Chinese-abortions.html>.
Hilton, Isabel. "China's One-party Monopoly of Power Is Coming to an End." London Guardian 12 July 2007 <http://www.guardian.co.uk/commentisfree/2007/jul/12/comment.china>.
Kahn, Joseph. "China Confirms Test of Anti-Satellite Weapon." New York Times 23 January 2007 <http://www.nytimes.com/2007/01/23/world/asia/23cnd-china.html>.
Kluger, Jeffrey. "Was A Satellite Shootdown Necessary?" Time 20 February 2008 <http://www.time.com/time/health/article/0,8599,1714811,00.html>.
Lou, Ying. "PetroChina's Value Tops $1 Trillion, Surpassing Exxon." Bloomberg November 2007 <http://www.bloomberg.com/apps/news?pid=20601087&sid=aQyRJI72Kor8>.
Marquand, Robert. "E.U. Weighs Olympic Boycott Over Tibet." Christian Science Monitor 27 March 2008.
Mone, Gregory. "Choking at the Olympics." Popular Science August 2007.
Musil, Steven. "Internet Censorship Plagues Journalists at Olympics." CNET News 29 July 2008 <http://news.cnet.com/8301-1023_3-10002097-93.html>.
Ritter, Peter. "The New Space Race: China vs. US." Time 13 February 2008 <http://www.time.com/time/world/article/0,8599,1712812,00.html>.
"Shanghai Now the World's Largest Cargo Port." Asia Times Online 7 January 2006 <http://www.atimes.com/atimes/China_Business/HA07Cb02.html>.
Stelter, Brian. "Networks Fight Shorter Olympic Leash." New York Times 21 July 2008 <http://www.nytimes.com/2008/07/21/sports/olympics/21nbc.html>.
Thomas, Gordon. Seeds of Fire: China And The Story Behind The Attack On America. Tempe: Dandelion Books, 2001.
"WHO Fears Over Beijing Pollution." BBC 17 August 2007 <http://news.bbc.co.uk/2/hi/asia-pacific/6950883.stm>.
Beast of the Month - August 2008
Hu Jintao, Chinese President
"I yam an anti-Christ..."
John Lydon (aka Johnny Rotten) of The Sex Pistols, "Anarchy in the UK"
"One World, One Dream"
Slogan of the 2008 Summer Olympics
On August 8, the Summer Olympics will be held in Beijing. It will begin at 8PM, which will make it the eighth hour of the eighth day of the eighth month of the eighth year of the century. (In case you didn't know, eight is considered the luckiest number in China, and the Chinese people are particularly superstitious about it.) When it is, it will be viewed in the korporate media as the final coronation of China as one of the few world superpowers. Like it actually needs one.
It's hard to believe it's been nine years since someone from China has won BOTM, and eleven since Jiang Zemin took home the trophy. Why that's particularly hard to believe is because in the past nine years, China has not gotten weaker, but rather frighteningly stronger.
Want the proof? Just walk down the aisle of your local Best Buy, Target or (of course) WalMart. Try to avoid buying products which aren't made in the People's Republic. Good luck. Freelance writer Sara Bongiorni did that a full year in 2005 with her family. Needless to say, it often turned shopping for even everyday products into an epic journey. Her four-year-old son, despondent over the cool toys and gadgets he was unable to obtain, had this to say about the end of the boycott: "When we can buy China things again, let's never stop." Ms. Bongiorni summed up her dilemma thusly:
"The funny thing about China's ascent is that we, as a nation, could shut the whole thing down in a week. Jump-start a 'Just Say No to Chinese Products Week,' and the empire will collapse amid the chaos of overloaded cargo ships in Long Beach harbor. I doubt we could pull it off. Americans may be famously patriotic, but look closely, and you'll see who makes the flag magnets on their car bumpers. These days China delivers every major holiday, Fourth of July included."
Of course, if China was merely destroying Team USA's manufacturing sector while poisoning kids with lead-filled toys, it would be bad enough. Currently, China is the number two holder of US Treasury securities, ahead of the UK and only trailing Japan. It is number two with a bullet. What this means is that increasingly China will have a major say in the decisions of our political establishment. It's hard to ignore that in the late 80s and early 90s, for all the hysteria that was directed at the evil Japanese empire, they were nowhere near the economic threat to America that China is now, and a fellow democracy to boot as compared to a communist dictatorship. So where are the panic-stricken pop novels like Michael Crichton's Rising Sun over China?
Okay, maybe that's a little over-the-top: China, after all, is no longer a communist dictatorship, it's a capitalist dictatorship. China has a $7 trillion a year GDP when measured in purchasing power parity, second only to the USA. Since 1978, when free market reforms were implemented, it has grown at an annual rate of over 8 percent. This growth has been aided over the last decade by the reacquisition of both Hong Kong in 1997 and Macau and 1999. Hong Kong long has been the world's shining example of free market economics (Milton Friedman gushed about it in his 1980 book Free to Choose) while Macau has surpassed Las Vegas as the world's largest gambling center, and now only Dubai exceeds it as an example of 21st century capitalism on steroids. Meanwhile, China's biggest oil producer PetroChina became the first trillion dollar company in value last November, and Shanghai has become the world's largest cargo port. With all this money flowing to China, talks of reunification with Taiwan can no longer be dismissed as merely a dream.
But China is definitely still an ugly dictatorship. The crackdown on Tiananmen Square may have happened nineteen years ago, but an environment toxic to freedom still is alive and well. When Hu Jintao (The Konformist Beast of the Month) was selected to take over China's presidency in 2002 from Jiang Zemin, there was widespread hope that he would become the nation's Gorbachev, that political freedom would be unleashed by what was suspected to be a closet liberal. This was aided by his close relationship with Premier Wen Jiabao, who is about as close to a populist figure that can be found in the Chinese establishment. Nearly six years later, this has been proven to be a bogus fantasy, a fantasy exposed most blatantly by the continuing suppression of the people of Tibet. Indeed, the recent crackdown on Tibetan followers of the exiled Dalai Lama has become so intense, there has been a heavy push for nations to boycott the Olympic opening ceremonies as protest. Other noted examples of China's continued repression are the persecution of the Falun Gong religious movement, the backing of a ruthless military junta in Burma and its ties to the bloodshed in Darfur via continued support of Sudan.
Some refer to the 2008 Games as the "Genocide Olympics" thanks to these crimes against humanity, and has led to further calls for a boycott, most notably from actress and UNICEF Goodwill Ambassador Mia Farrow, actor and Tibetan activist Richard Gere, director Steven Spielberg and Nobel Peace Prize winner Desmond Tutu. The most in-your-face example of China's continued autocratic style is the nation's crackdown on the Internet, which is already a major hurdle for journalist attempting to cover the Olympic Games. This is despite being lied to repeatedly by China that Internet censorship would be lifted on journalists during the games. (Hard to believe a dictatorship would use deception to land an esteemed multi-billion dollar reward.) According to an International Olympic Committee commissioner: "Had the I.O.C., and those vested with the decision to award the host city contract, known seven years ago that there would be severe restrictions on people being able to enter China simply to watch the Olympics, or that live broadcasting from Tiananmen Square would essentially be banned, or that reporters would be corralled at the whim of local security, then I seriously doubt whether Beijing would have been awarded the Olympics.” The climate of persecution that pervades the Summer Games has been so vast, criticisms of Beijing's toxic smog due to intense air pollution have been almost an afterthought. It appears that for all the talk of open markets leading to freedom, it's going to take longer to achieve Chinese democracy than it has taken Axl Rose to finish his GNR album of the same name.
Over the last eight years, two camps of the GOP have been divided over whether to continue treating China as a trading partner or turning them into an adversary for a Cold War sequel. (These two camps can be referred to as the "Shopping Mall Fascists" and the "War & Oil Fascists" for those keeping score at home.) This division is illustrated in the pro-China positions of both Fox Chairman Rupert Murdoch and Christian televangelist Pat Robertson, both having normally anti-Communist views apparently trumped by their desire to profit in the untapped Chinese market. (Robertson's mammon is particularly telling, as he actually has defended China's forced abortion policy to control population, a step beyond the mere "pro-choice" position of American abortion activists he regularly bashes.) The general results of this debate has led the Bush Team to continue the plunge into transferring dollars into China's coffers while getting any dig into them whenever they can, no matter how petty. One noted example: the April Fools 2001 crash between a US spy plane and a Chinese fighter jet that led to the death of PLA pilot Wang Wei. Immediately, the Bush Administration insisted the incident happened in international airspace (a dubious claim) and demanded the release of the entire crew. (It's hard to imagine that if a Chinese spy plane near US borders caused the death of an American navy pilot, Team USA would immediately release the crew and their plane without investigation.) Ten days later, when the Bush Administration gave a belated and unconvincing apology after an increasingly shrill hysteria swept through the press, China released the crew, but by then the diplomatic damage had been unnecessarily done. Cut to 2006, when a visit by Jintao to the US was littered with snubs that showed a calculated pattern. Among the greatest hits: referring to China as “the Republic of China" (the actual title for Taiwan) during the official White House greeting. Perhaps even worse was granting a Falun Gong anti-China activist press credentials to a joint Bush-Jintao press conference. The press conference was interrupted for three minutes by an angry denunciation of Jintao and China by the activist, something which would've been halted immediately if it was an attack on Bush's failed War in Iraq. Normally, the granting of a press pass is so controlled, only right-wing closet gay prostitutes who sleep at the White House overnight can evade the tight scrutiny, which indicates the Falun Gong supporter's activities were sanctioned by the Bush Administration all along.
Of course, not all battles between China and the US are so minor. Both countries have used bogus excuses to use military weaponry in space, moves that indicate a "Star Wars" may eventually explode between the two nations for control of the Earth's skies. And as PetroChina's rise clearly shows, there is a huge battle already being covertly waged between the two countries over the vast Caspian Sea oil reserves. This covert war may go deeper than most suspect: while 9/11 conspiracy theories mainly focus on the US military, Israel, Saudi Arabia or the UK as the alternative culprit, Gordon Thomas makes the case in the book Seeds of Fire that the terrorist attack was actually a Chinese operation to punish the US and strengthen ties between China and Islamic nations. In particular, the book details the close financial relationship between China and the Taliban before 9/11. (Coincidentally, the Taliban was run from power almost immediately after China was voted into the WTO in November 2001.) That being the case, perhaps the tensions between the US and China will become increasingly overt as China continues to gain power without firing a single weapon.
In any case, we salute Hu Jintao as Beast of the Month. Congratulations, and keep up the great work, Hu!!!
Sources:
Barboza, David. "Macao Surpasses Las Vegas as Gambling Center." New York Times 23 January 2007 <http://www.nytimes.com/2007/01/23/business/worldbusiness/23cnd-macao.html>.
Bodeen, Christopher. "Under Hu, China Tightening Media Reins." Washington Post 21 April 2006 <http://www.washingtonpost.com/wp-dyn/content/article/2006/04/21/AR2006042100951.html>.
Bongiorni, Sara. "A Year Without 'Made in China'." Christian Science Monitor 20 December 2005 <http://www.csmonitor.com/2005/1220/p09s01-coop.html>.
Bongiorni, Sara. A Year Without "Made in China": One Family's True Life Adventure in the Global Economy. Hoboken: Wiley, 2007.
Chin, Larry. "Is the Anglo-American Empire Losing the 'Great Energy Game'?" Online Journal 8 January 2007 <http://onlinejournal.com/artman/publish/article_1612.shtml>.
"China's Hu Vows to 'Purify' Internet." Reuters 24 January 2007 <http://www.reuters.com/article/idUSPEK9570520070124>.
"Dalai Lama: China Causing 'Cultural Genocide'." CNN 17 March 2008 <http://edition.cnn.com/2008/WORLD/asiapcf/03/16/tibet.unrest>.
Eimer, David. "China Earthquake: Superstition a Potent Force." London Telegraph 24 May 2008 <http://www.telegraph.co.uk/news/worldnews/asia/china/2021715/China-earthquake-Superstition-a-potent-force.html>.
"The Genocide Olympics?" Washington Post 14 December 2006.
Harnden, Toby. "Outrage as Preacher Refuses to Condemn Chinese Abortions." London Telegraph 20 July 2001 <http://www.telegraph.co.uk/news/worldnews/1316790/Outrage-as-preacher-refuses-to-condemn-Chinese-abortions.html>.
Hilton, Isabel. "China's One-party Monopoly of Power Is Coming to an End." London Guardian 12 July 2007 <http://www.guardian.co.uk/commentisfree/2007/jul/12/comment.china>.
Kahn, Joseph. "China Confirms Test of Anti-Satellite Weapon." New York Times 23 January 2007 <http://www.nytimes.com/2007/01/23/world/asia/23cnd-china.html>.
Kluger, Jeffrey. "Was A Satellite Shootdown Necessary?" Time 20 February 2008 <http://www.time.com/time/health/article/0,8599,1714811,00.html>.
Lou, Ying. "PetroChina's Value Tops $1 Trillion, Surpassing Exxon." Bloomberg November 2007 <http://www.bloomberg.com/apps/news?pid=20601087&sid=aQyRJI72Kor8>.
Marquand, Robert. "E.U. Weighs Olympic Boycott Over Tibet." Christian Science Monitor 27 March 2008.
Mone, Gregory. "Choking at the Olympics." Popular Science August 2007.
Musil, Steven. "Internet Censorship Plagues Journalists at Olympics." CNET News 29 July 2008 <http://news.cnet.com/8301-1023_3-10002097-93.html>.
Ritter, Peter. "The New Space Race: China vs. US." Time 13 February 2008 <http://www.time.com/time/world/article/0,8599,1712812,00.html>.
"Shanghai Now the World's Largest Cargo Port." Asia Times Online 7 January 2006 <http://www.atimes.com/atimes/China_Business/HA07Cb02.html>.
Stelter, Brian. "Networks Fight Shorter Olympic Leash." New York Times 21 July 2008 <http://www.nytimes.com/2008/07/21/sports/olympics/21nbc.html>.
Thomas, Gordon. Seeds of Fire: China And The Story Behind The Attack On America. Tempe: Dandelion Books, 2001.
"WHO Fears Over Beijing Pollution." BBC 17 August 2007 <http://news.bbc.co.uk/2/hi/asia-pacific/6950883.stm>.
Friday, March 28, 2008
Small Business Forced to Close by Wal-Mart
http://www.politicalaffairs.net/article/articleview/6649/1/324/
Small Business Forced to Close by Gov't. Subsidies to Wal-Mart
By Sherwood Ross
3-25-08
Small retailers the nation over are being pushed out of business by government subsidies to chain competitors such as Wal-Mart and Target through a variety of “corporate socialism” schemes, taxation authority David Cay Johnston says.
Municipalities are permitting “tax increment financing” that allow the big chains “to keep the sales taxes that you are forced to pay at the tax register,” Johnston said on the television interview program “Books of Our Time,” sponsored by the Massachusetts School of Law at Andover and broadcast by Comcast.
“Instead of that money going to the schools and the fire department and the police department and the library, it is funneled through a mechanism of local government, usually a special authority, to finance the purchase of municipal bonds so that means that the wealthy underwriters and the lawyers and auditors all get a piece of this money to buy the land and build the store,” Johnson told TV host Lawrence Velvel, dean of the law school.
The store is then leased to the big chain developer “at terms that amount to giving it to them for free or nearly free over a period of time,” Johnston said, “and it’s destroying local business.” An amazing aspect of this “corporate socialism” policy, Johnston says, “is that local business owners have not risen up and stopped this.”
“A system in which government, whether Federal or local, picks the winners in the economy, is not capitalism, it’s not competition, it’s not free market, it is corporate socialism, it is statism, it’s the state making these choices,” Johnston said.
In his new book, “Free Lunch”(Portfolio) Johnston amplifies this point by noting “Sam Walton practiced corporate socialism. As much as he could, he put the public’s money to work for his benefit. Free land, long-term leases at below-market rates, pocketing sales taxes, even getting workers trained at government expense were among the ways Wal-Mart took every dollar of welfare it could get.”
“Walton had a particular fondness for government-sponsored industrial revenue bonds,” Johnston continued, “which cost him less in interest charges than the corporate bonds the market economy uses to raise money.”
Johnston said in the television interview that if the public really understood what was happening they would not permit government subsidies to corporations to go forward.
Johnston pointed out: “Subsidies to retail cannot make us wealthier. Retail is at the end of the economic line. If you want to subsidize things, first subsidize education, then subsidize basic research, then subsidize applied research and development and subsidize infrastructure---rails and canals and highways---and maybe in some cases manufacturing and mining to get something going. But the least bang for the buck, and often the negative bang for the buck, would be subsidizing retail. What’s happening is wealthy families, the richest families in America, are getting welfare and they apparently have no shame about this.”
Johnston points out government handouts for Wal-Mart “reduce the costs of competing in the market” and by soliciting the subsidies “Wal-Mart shifted some of the risks of its expansion onto the majority of Americans who are not regular Wal-Mart shoppers.”
He said the fortune Wal-Mart is reaping is no different from what other corporate players are getting. “We are transferring enormous amounts of money to corporations and wealthy individuals,” Johnston pointed out. For example, he said, “We gave Warren Buffett’s companies a hundred million dollar gift last year.” (Buffett’s firm has a two-thirds-billion-dollar, interest-free loan from our government for more than 28 year, Johnston notes. Similarly, Donald Trump benefits from a tax enacted to help the elderly and the poor but part of which is now diverted to his casinos, Johnston says.)
“The incomes of the top one percent are exploding, are pulling away from everybody else,” Johnston said, “while the middle-class is stifling and the bottom is dropping out (of the economy).”
Author Johnson, for many years the tax reporter for The New York Times, has won a Pulitzer Prize and many other awards and uncovered so many tax dodges that he has been called the “de facto chief tax enforcement officer of the United States.”
The Massachusetts School of Law(MSL), sponsors of “Books Of Our Time,” is a non-profit institution dedicated to providing a quality, affordable legal education to minorities’, immigrants, and students from economically disadvantaged families who would otherwise not be able to attend law school and enter the legal profession.
--Further Information: Sherwood Ross, media consultant to MSL at sherwoodr1@yahoo.com
Small Business Forced to Close by Gov't. Subsidies to Wal-Mart
By Sherwood Ross
3-25-08
Small retailers the nation over are being pushed out of business by government subsidies to chain competitors such as Wal-Mart and Target through a variety of “corporate socialism” schemes, taxation authority David Cay Johnston says.
Municipalities are permitting “tax increment financing” that allow the big chains “to keep the sales taxes that you are forced to pay at the tax register,” Johnston said on the television interview program “Books of Our Time,” sponsored by the Massachusetts School of Law at Andover and broadcast by Comcast.
“Instead of that money going to the schools and the fire department and the police department and the library, it is funneled through a mechanism of local government, usually a special authority, to finance the purchase of municipal bonds so that means that the wealthy underwriters and the lawyers and auditors all get a piece of this money to buy the land and build the store,” Johnson told TV host Lawrence Velvel, dean of the law school.
The store is then leased to the big chain developer “at terms that amount to giving it to them for free or nearly free over a period of time,” Johnston said, “and it’s destroying local business.” An amazing aspect of this “corporate socialism” policy, Johnston says, “is that local business owners have not risen up and stopped this.”
“A system in which government, whether Federal or local, picks the winners in the economy, is not capitalism, it’s not competition, it’s not free market, it is corporate socialism, it is statism, it’s the state making these choices,” Johnston said.
In his new book, “Free Lunch”(Portfolio) Johnston amplifies this point by noting “Sam Walton practiced corporate socialism. As much as he could, he put the public’s money to work for his benefit. Free land, long-term leases at below-market rates, pocketing sales taxes, even getting workers trained at government expense were among the ways Wal-Mart took every dollar of welfare it could get.”
“Walton had a particular fondness for government-sponsored industrial revenue bonds,” Johnston continued, “which cost him less in interest charges than the corporate bonds the market economy uses to raise money.”
Johnston said in the television interview that if the public really understood what was happening they would not permit government subsidies to corporations to go forward.
Johnston pointed out: “Subsidies to retail cannot make us wealthier. Retail is at the end of the economic line. If you want to subsidize things, first subsidize education, then subsidize basic research, then subsidize applied research and development and subsidize infrastructure---rails and canals and highways---and maybe in some cases manufacturing and mining to get something going. But the least bang for the buck, and often the negative bang for the buck, would be subsidizing retail. What’s happening is wealthy families, the richest families in America, are getting welfare and they apparently have no shame about this.”
Johnston points out government handouts for Wal-Mart “reduce the costs of competing in the market” and by soliciting the subsidies “Wal-Mart shifted some of the risks of its expansion onto the majority of Americans who are not regular Wal-Mart shoppers.”
He said the fortune Wal-Mart is reaping is no different from what other corporate players are getting. “We are transferring enormous amounts of money to corporations and wealthy individuals,” Johnston pointed out. For example, he said, “We gave Warren Buffett’s companies a hundred million dollar gift last year.” (Buffett’s firm has a two-thirds-billion-dollar, interest-free loan from our government for more than 28 year, Johnston notes. Similarly, Donald Trump benefits from a tax enacted to help the elderly and the poor but part of which is now diverted to his casinos, Johnston says.)
“The incomes of the top one percent are exploding, are pulling away from everybody else,” Johnston said, “while the middle-class is stifling and the bottom is dropping out (of the economy).”
Author Johnson, for many years the tax reporter for The New York Times, has won a Pulitzer Prize and many other awards and uncovered so many tax dodges that he has been called the “de facto chief tax enforcement officer of the United States.”
The Massachusetts School of Law(MSL), sponsors of “Books Of Our Time,” is a non-profit institution dedicated to providing a quality, affordable legal education to minorities’, immigrants, and students from economically disadvantaged families who would otherwise not be able to attend law school and enter the legal profession.
--Further Information: Sherwood Ross, media consultant to MSL at sherwoodr1@yahoo.com
Sunday, March 2, 2008
When will iTunes replace Wal-Mart as No. 1?
http://www.news.com/8301-10784_3-9880001-7.html
February 26, 2008
When will iTunes replace Wal-Mart as No. 1 music retailer?
Posted by Greg Sandoval
Apple's iTunes will likely whip past Wal-Mart Stores to become the largest U.S. music retailer sometime this year.
The NPD Group issued a report Tuesday that said Apple had outpaced Best Buy and Target to become the No. 2 U.S. music retailer. Unless the downward trend in CD sales suddenly reverses, Apple will be No. 1, said Russ Crupnick, the NPD Group's president of Music.
"Digital sales were up close to 50 percent and CD sales were down 20 percent last year," Crupnick said. "Even at half that growth rate in digital sales, Apple will in all likelihood catch Wal-Mart this year."
Anybody in their teens or early 20s is going to ask, "So what else is new?" To them, digital downloads has been part of their lives for years. It's only natural that a download store emerge as the top seller.
But anybody older is going to remember that it wasn't too long ago when music buying meant flipping through CD racks at the former retail powerhouses, Sam Goody and Tower Records.
"That's the question that the music industry has to answer soon: How do we get young people to start paying for music again? They've got to make it easier for teens to buy online."
--Russ Crupnick, analyst
Tower no longer operates retail stores, and Sam Goody's owner is renaming whatever locations it hasn't closed. "Yeah, it's astonishing--just in the post-Napster era--to see what's happened to the retail-sales environment," Crupnick said.
Apparently, the transition from offline to digital sales is occurring faster than most people expected. (Remember how record executives used to whip out statements like: "Discs are still how most people listen to music."
They may have been right then, but perhaps that won't be the case much longer.
Consider that the music industry is seeing pressure on CD sales from multiple fronts. In the offline world, there is a sort of death spiral going on, Crupnick said. As CD sales continue to slide, retailers like Wal-Mart, Best Buy, and Target devote less and less floor space to discs--which of course serves to erode sales even further.
Amazon.com, the e-tailer that used to be synonymous with ordering CDs off the Internet, has opened a music-download store to challenge iTunes.
Then there is the teen market that is abandoning CDs in droves. According to the report issued by NPD on Tuesday, nearly half of all U.S. teens (48 percent) did not purchase a CD last year. That is up from 2006, when about 38 percent of teens made no CD purchases.
Older music fans are transitioning at a slower rate but it's happening there too. In total, NPD Group said that the music industry waved bye-bye to about 1 million CD buyers last year.
Music remains popular, according to report, which found the amount of music acquired by consumers went up 6 percent. The trouble is that less of it is being paid for. Spending among Internet users fell from about $44 per capita to $40.
It must also be said that not all of Apple's success is due to the growing digital demand. Apple has flat out done a better job of retailing than competitors, Crupnick said.
For example, the music industry should follow Apple's lead and direct their attention to teenagers, Crupnick said.
Teens lack credit cards and this often prevents them from buying at almost everywhere but iTunes, Crupnick said. Apple avoids credit cards by pushing the gift cards, which teens can pay for at retail locations and then use them to purchase songs online by keying in a code. No credit cards needed.
"That's the question that the music industry has to answer soon," Crupnick said. "How do we get young people to start paying for music again? They've got to make it easier for teens to buy online. Apple CEO Steve Jobs has done a wonderful job of this. Teens have a way to do commerce with iTunes."
Tags:Apple, iTunes, Wal-Mart, Best Buy, Tower Records
February 26, 2008
When will iTunes replace Wal-Mart as No. 1 music retailer?
Posted by Greg Sandoval
Apple's iTunes will likely whip past Wal-Mart Stores to become the largest U.S. music retailer sometime this year.
The NPD Group issued a report Tuesday that said Apple had outpaced Best Buy and Target to become the No. 2 U.S. music retailer. Unless the downward trend in CD sales suddenly reverses, Apple will be No. 1, said Russ Crupnick, the NPD Group's president of Music.
"Digital sales were up close to 50 percent and CD sales were down 20 percent last year," Crupnick said. "Even at half that growth rate in digital sales, Apple will in all likelihood catch Wal-Mart this year."
Anybody in their teens or early 20s is going to ask, "So what else is new?" To them, digital downloads has been part of their lives for years. It's only natural that a download store emerge as the top seller.
But anybody older is going to remember that it wasn't too long ago when music buying meant flipping through CD racks at the former retail powerhouses, Sam Goody and Tower Records.
"That's the question that the music industry has to answer soon: How do we get young people to start paying for music again? They've got to make it easier for teens to buy online."
--Russ Crupnick, analyst
Tower no longer operates retail stores, and Sam Goody's owner is renaming whatever locations it hasn't closed. "Yeah, it's astonishing--just in the post-Napster era--to see what's happened to the retail-sales environment," Crupnick said.
Apparently, the transition from offline to digital sales is occurring faster than most people expected. (Remember how record executives used to whip out statements like: "Discs are still how most people listen to music."
They may have been right then, but perhaps that won't be the case much longer.
Consider that the music industry is seeing pressure on CD sales from multiple fronts. In the offline world, there is a sort of death spiral going on, Crupnick said. As CD sales continue to slide, retailers like Wal-Mart, Best Buy, and Target devote less and less floor space to discs--which of course serves to erode sales even further.
Amazon.com, the e-tailer that used to be synonymous with ordering CDs off the Internet, has opened a music-download store to challenge iTunes.
Then there is the teen market that is abandoning CDs in droves. According to the report issued by NPD on Tuesday, nearly half of all U.S. teens (48 percent) did not purchase a CD last year. That is up from 2006, when about 38 percent of teens made no CD purchases.
Older music fans are transitioning at a slower rate but it's happening there too. In total, NPD Group said that the music industry waved bye-bye to about 1 million CD buyers last year.
Music remains popular, according to report, which found the amount of music acquired by consumers went up 6 percent. The trouble is that less of it is being paid for. Spending among Internet users fell from about $44 per capita to $40.
It must also be said that not all of Apple's success is due to the growing digital demand. Apple has flat out done a better job of retailing than competitors, Crupnick said.
For example, the music industry should follow Apple's lead and direct their attention to teenagers, Crupnick said.
Teens lack credit cards and this often prevents them from buying at almost everywhere but iTunes, Crupnick said. Apple avoids credit cards by pushing the gift cards, which teens can pay for at retail locations and then use them to purchase songs online by keying in a code. No credit cards needed.
"That's the question that the music industry has to answer soon," Crupnick said. "How do we get young people to start paying for music again? They've got to make it easier for teens to buy online. Apple CEO Steve Jobs has done a wonderful job of this. Teens have a way to do commerce with iTunes."
Tags:Apple, iTunes, Wal-Mart, Best Buy, Tower Records
iTunes No. 2 music seller in US
http://www.businessweek.com/ap/financialnews/D8V23V300.htm
The Associated Press
February 26, 2008
NPD: iTunes No. 2 music seller in US
By RACHEL METZ
Apple Inc.'s online iTunes music store is now the number-two music retailer in the U.S. behind Wal-Mart Stores Inc. as measured by unit volume, market researcher NPD Group said Tuesday.
NPD said that iTunes moved into second place due to the amount of music it sold during 2007, which was based on a 12-track CD equivalency for song downloads.
The market researcher began tracking music sold stateside during the middle of 2006. In the fourth quarter of that year, Best Buy Co. took second place behind Wal-Mart, while Target Corp. took third place and Apple's iTunes store fourth place, NPD analyst Russ Crupnick said.
For the full year 2007, Best Buy came in third and Target fourth, he said.
Crupnick called Apple's move to the number-two spot "fairly understandable given the pressure that's been on CDs and the almost 50-percent growth in digital downloading in the past year."
About 10 percent of music acquired in the U.S. was through legal downloads in 2007, and consumers who bought digital music legally through pay-to-download Web sites grew by 5 million to 29 million in 2007, NPD said Tuesday.
Meanwhile, an estimated 1 million consumers did not buy CDs in 2007, and 48 percent of U.S. teenagers didn't buy any CDs during the year, up from 38 percent in the year before, according to NPD data.
"It wouldn't surprise me if we see the same things continuing into 2008 because what our research is showing is that teens are continuing to check out on the CD," Crupnick said.
NPD also said that the amount of music consumers bought in the U.S. rose 6 percent in 2007, though the decline in CD sales and increase in legal digital download sales still led to a 10 percent overall decrease in music spending.
Apple shares fell $2.55, or 2.1 percent, to $117.19 in morning trading, while Wal-Mart shares rose 80 cents to $51.13.
The Associated Press
February 26, 2008
NPD: iTunes No. 2 music seller in US
By RACHEL METZ
Apple Inc.'s online iTunes music store is now the number-two music retailer in the U.S. behind Wal-Mart Stores Inc. as measured by unit volume, market researcher NPD Group said Tuesday.
NPD said that iTunes moved into second place due to the amount of music it sold during 2007, which was based on a 12-track CD equivalency for song downloads.
The market researcher began tracking music sold stateside during the middle of 2006. In the fourth quarter of that year, Best Buy Co. took second place behind Wal-Mart, while Target Corp. took third place and Apple's iTunes store fourth place, NPD analyst Russ Crupnick said.
For the full year 2007, Best Buy came in third and Target fourth, he said.
Crupnick called Apple's move to the number-two spot "fairly understandable given the pressure that's been on CDs and the almost 50-percent growth in digital downloading in the past year."
About 10 percent of music acquired in the U.S. was through legal downloads in 2007, and consumers who bought digital music legally through pay-to-download Web sites grew by 5 million to 29 million in 2007, NPD said Tuesday.
Meanwhile, an estimated 1 million consumers did not buy CDs in 2007, and 48 percent of U.S. teenagers didn't buy any CDs during the year, up from 38 percent in the year before, according to NPD data.
"It wouldn't surprise me if we see the same things continuing into 2008 because what our research is showing is that teens are continuing to check out on the CD," Crupnick said.
NPD also said that the amount of music consumers bought in the U.S. rose 6 percent in 2007, though the decline in CD sales and increase in legal digital download sales still led to a 10 percent overall decrease in music spending.
Apple shares fell $2.55, or 2.1 percent, to $117.19 in morning trading, while Wal-Mart shares rose 80 cents to $51.13.
Wednesday, February 27, 2008
DVD FORMATS
http://www.theglobeandmail.com/servlet/story/LAC.20080220.RBLURAY20/TPStory/?query=Toshiba
DVD FORMATS: HOW SONY'S BLU-RAY TRIUMPHED OVER TOSHIBA'S HD
Stringer makes his mark
Sony's CEO led his company to victory in the high-definition sweepstakes by convincing the major studios to come aboard
BARRIE MCKENNA AND MATT HARTLEY
February 20, 2008
WASHINGTON, TORONTO -- Howard Stringer made history in 2005 for being the first non-Japanese executive to take the helm at Sony Corp. But he may be better remembered as the one who won the high-definition war, erasing the stain on the electronics firm's image ever since it lost the videotape war two decades earlier.
Although celebrated yesterday, the victory was sealed last month when Sony swayed Warner Bros. to back Sony's Blu-ray technology and quit producing movies using Toshiba Corp.'s rival HD DVD format.
What remains a mystery is just how big a push Warner needed to pick sides. Analysts say Sony only prevailed following a heated bidding war against Toshiba, with the reward reaching as much as $400-million (U.S.). Neither side has confirmed the size of any bids or payments.
It was supposed to be the technology equivalent of First World War trench warfare: A prolonged battle to the death between Toshiba and Sony for global domination in high-definition DVDs.
In the end, the denouement was more like Germany's swift 1940 end run of the Maginot line.
Less than two years after its first HD DVD player hit the market, Toshiba president Atsutoshi Nishida raised the white flag, declaring yesterday that it would stop making and selling the devices altogether within a month.
Toshiba's unconditional surrender leaves the spoils to Sony, maker of the rival Blu-ray disc player - a technologically superior format that had the backing of virtually all the major movie studies and retailers.
"We simply had no chance to win," Mr. Nishida acknowledged bluntly.
The final straw, he said, was Warner's decision last month to exclusively release movies in Blu-ray. The decision by Warner, with about 20 per cent of the movie market, put a critical mass of the industry in the Blu-ray camp.
With billions of dollars in global sales at stake, experts had predicted the Toshiba-Sony battle would go on for years - not unlike the 1980s battle of videotape formats between VHS (Matsushita) and Betamax (Sony). That war lasted a decade, leaving Sony battered and humiliated.
So how did this epic battle come to such an abrupt end?
The answer lies in part with the bruising Sony experienced with Betamax, which, like Blu-ray, was also the better product on paper.
For more that 20 years, Sony has been "haunted by Betamax" and was fiercely determined not to let history repeat itself, explained Xavier Drèze, a marketing professor at the University of Pennsylvania's Wharton business school.
"Sony was much smarter," Prof. Drèze said. "They understood this time they couldn't do it alone. They understood that they needed strategic partnerships with industry players."
The war was over when Sony managed to line up a critical mass of partners - in Hollywood, Silicon Valley and on Main Street.
The tipping point was Warner Bros. But Sony Pictures, Walt Disney Co. and News Corp.'s Twentieth Century Fox Film Corp. had already done the same - signing exclusive sealed deals with presumably rich royalty arrangements.
"This was heavy hitters in a back room talking about what the royalty structure was going to be and how much money they were willing to put on the table to be exclusive with one camp or the other. That was the determining factor here," concluded Van Baker, an analyst with market research firm Gartner Inc.
Until last month, Warner had been backing both technologies.
Last Friday, Wal-Mart Stores Inc. announced it would sell only Blu-ray DVDs. Officials said "customer feedback" prompted its decision.
Netflix Inc., Best Buy Co. Inc., Blockbuster Inc. and Target Corp. had earlier done the same.
"Everyone was tired of the format war, the retailers were tired of it, the consumer electronics vendors were tired of it and they just wanted this thing to get settled," Mr. Baker said.
"Consumers and the industry learned the hard way with Beta and VHS that a prolonged format war was disastrous. There was a lot of motivation to get one or the other to win and the only thing that protracted it was the amount of money flying around."
The groundwork for Sony's stunning victory, however, came months, even years ago. Prof. Drèze said Blu-ray had several things going for it that helped it to build loyalty with consumers and the industry.
Six years ago yesterday - and years before the first Blu-ray disc or player was sold - Sony had lined up most of the other computer and electronics makers, including LG Electronics, Panasonic, Samsung, Apple and Dell.
Sony also owned a major movie studio. So it could push its own technology.
Third, the company sold Blu-ray to rival movie studios with the promise of superior digital copyright protection.
Sony also used its PlayStation video game console, which also works as a Blu-ray player, as a sort of "Trojan horse," Prof. Drèze said.
Sony has already sold 10.5 million of its PS3 consoles, compared with roughly one million HD DVD players. PlayStation buyers, he said, unwittingly embraced Blu-ray and undermined HD DVD.
Ultimately, the technology is superior. Blu-ray can hold up to three times more data (200 gigabytes versus 60) and offers higher resolution.
In the end, it could be a pyrrhic victory for Sony. The age of hard copy discs is already giving way to digital downloads, stored and played from PCs, iPods and other portable devices.
"I don't think the heyday of DVD is going to return," said Mr. Baker, the analyst. "For most consumers, digital downloads are going to be very appealing."
How Sony lost Betamax
1 QUALITY OVER
QUANTITY Despite better picture quality, Sony's original Betamax tapes could record only one hour of video, while rival VHS tapes could store double that.
2 SECRET RECIPE
Sony initially failed to license its Betamax technology to a sufficient number of manufacturers, thinking it could go it alone. This led to a situation where VHS players competed against one another for share, driving down prices and making the format more attractive to consumers.
3 BUYING V. RENTING When both systems arrived in the United States in the mid-1970s, VHS machines were less expensive to rent. When consumers began to purchase rather than rent their video players, they tended to go with VHS machines. 4PORN CONUNDRUM Sony refused to license the Betamax technology to adult film companies, who turned to VHS tapes and ended up creating a multibillion-dollar industry.
How Sony won Blu-ray
1 BIGGER IS BETTER
Sony's Blu-ray discs can store upward of 50 gigabytes of data on a single disc, while HD DVDs hold about 30 gigs.
2 PLAYSTATION 3
By including a Blu-ray drive in its next-generation video game console, Sony was able to drive sales of both the PS3 and its new DVD format.
3 SOLID PARTNERSHIPS Not wanting to duplicate the Betamax mistake, Sony took the initiative to license its Blu-ray technology with as many partners as possible. When Blu-ray was first announced in 2002, Sony had already signed up eight partner companies committed to producing players.
4 CONTENT IS KING
By signing exclusive deals with more studios and content providers than Toshiba, Sony was able to squeeze its competitor to the sidelines. Warner's defection to Blu-ray was the fatal blow.
Matt Hartley
Dead technologies
Media formats we have used, loved and discarded for the next best thing
The cassette tape
A Walkman and roller skates, anyone? Tapes were the original portable format and made music pirates of us all. (Can I tape your Fleetwood Mac Rumors?) But they were hated by record companies. The sound quality tended to go tinny after a few dozen plays, and many tapes wound up melting in a car on a sunny day.
Eight tracks
Developed by plane maker Bill Lear, eight-track tapes were large and couldn't be rewound. And because of their high tape speed, didn't sound great. Nevertheless, they were popular in the 1970s, thanks to the auto industry, which installed thousands of eight-track players. When sales slipped, companies eager to pare formats quickly dropped the eight track. Vinyl
Cumbersome to play and easily damaged, albums faded out in the late 1980s. But album covers managed to become a genuine art form and another way to grab music buyers' attention. Lately, albums have a enjoyed a comeback, thanks to collectors, club DJs and scratching (ask your kids).
Compact discs
CDs are dead? They will be soon. Who needs all those plastic cases and discs when you can fill your hard drive and iPod with thousands of songs? Using a credit card, of course. Downloading music for free is wrong, isn't it?
DVD FORMATS: HOW SONY'S BLU-RAY TRIUMPHED OVER TOSHIBA'S HD
Stringer makes his mark
Sony's CEO led his company to victory in the high-definition sweepstakes by convincing the major studios to come aboard
BARRIE MCKENNA AND MATT HARTLEY
February 20, 2008
WASHINGTON, TORONTO -- Howard Stringer made history in 2005 for being the first non-Japanese executive to take the helm at Sony Corp. But he may be better remembered as the one who won the high-definition war, erasing the stain on the electronics firm's image ever since it lost the videotape war two decades earlier.
Although celebrated yesterday, the victory was sealed last month when Sony swayed Warner Bros. to back Sony's Blu-ray technology and quit producing movies using Toshiba Corp.'s rival HD DVD format.
What remains a mystery is just how big a push Warner needed to pick sides. Analysts say Sony only prevailed following a heated bidding war against Toshiba, with the reward reaching as much as $400-million (U.S.). Neither side has confirmed the size of any bids or payments.
It was supposed to be the technology equivalent of First World War trench warfare: A prolonged battle to the death between Toshiba and Sony for global domination in high-definition DVDs.
In the end, the denouement was more like Germany's swift 1940 end run of the Maginot line.
Less than two years after its first HD DVD player hit the market, Toshiba president Atsutoshi Nishida raised the white flag, declaring yesterday that it would stop making and selling the devices altogether within a month.
Toshiba's unconditional surrender leaves the spoils to Sony, maker of the rival Blu-ray disc player - a technologically superior format that had the backing of virtually all the major movie studies and retailers.
"We simply had no chance to win," Mr. Nishida acknowledged bluntly.
The final straw, he said, was Warner's decision last month to exclusively release movies in Blu-ray. The decision by Warner, with about 20 per cent of the movie market, put a critical mass of the industry in the Blu-ray camp.
With billions of dollars in global sales at stake, experts had predicted the Toshiba-Sony battle would go on for years - not unlike the 1980s battle of videotape formats between VHS (Matsushita) and Betamax (Sony). That war lasted a decade, leaving Sony battered and humiliated.
So how did this epic battle come to such an abrupt end?
The answer lies in part with the bruising Sony experienced with Betamax, which, like Blu-ray, was also the better product on paper.
For more that 20 years, Sony has been "haunted by Betamax" and was fiercely determined not to let history repeat itself, explained Xavier Drèze, a marketing professor at the University of Pennsylvania's Wharton business school.
"Sony was much smarter," Prof. Drèze said. "They understood this time they couldn't do it alone. They understood that they needed strategic partnerships with industry players."
The war was over when Sony managed to line up a critical mass of partners - in Hollywood, Silicon Valley and on Main Street.
The tipping point was Warner Bros. But Sony Pictures, Walt Disney Co. and News Corp.'s Twentieth Century Fox Film Corp. had already done the same - signing exclusive sealed deals with presumably rich royalty arrangements.
"This was heavy hitters in a back room talking about what the royalty structure was going to be and how much money they were willing to put on the table to be exclusive with one camp or the other. That was the determining factor here," concluded Van Baker, an analyst with market research firm Gartner Inc.
Until last month, Warner had been backing both technologies.
Last Friday, Wal-Mart Stores Inc. announced it would sell only Blu-ray DVDs. Officials said "customer feedback" prompted its decision.
Netflix Inc., Best Buy Co. Inc., Blockbuster Inc. and Target Corp. had earlier done the same.
"Everyone was tired of the format war, the retailers were tired of it, the consumer electronics vendors were tired of it and they just wanted this thing to get settled," Mr. Baker said.
"Consumers and the industry learned the hard way with Beta and VHS that a prolonged format war was disastrous. There was a lot of motivation to get one or the other to win and the only thing that protracted it was the amount of money flying around."
The groundwork for Sony's stunning victory, however, came months, even years ago. Prof. Drèze said Blu-ray had several things going for it that helped it to build loyalty with consumers and the industry.
Six years ago yesterday - and years before the first Blu-ray disc or player was sold - Sony had lined up most of the other computer and electronics makers, including LG Electronics, Panasonic, Samsung, Apple and Dell.
Sony also owned a major movie studio. So it could push its own technology.
Third, the company sold Blu-ray to rival movie studios with the promise of superior digital copyright protection.
Sony also used its PlayStation video game console, which also works as a Blu-ray player, as a sort of "Trojan horse," Prof. Drèze said.
Sony has already sold 10.5 million of its PS3 consoles, compared with roughly one million HD DVD players. PlayStation buyers, he said, unwittingly embraced Blu-ray and undermined HD DVD.
Ultimately, the technology is superior. Blu-ray can hold up to three times more data (200 gigabytes versus 60) and offers higher resolution.
In the end, it could be a pyrrhic victory for Sony. The age of hard copy discs is already giving way to digital downloads, stored and played from PCs, iPods and other portable devices.
"I don't think the heyday of DVD is going to return," said Mr. Baker, the analyst. "For most consumers, digital downloads are going to be very appealing."
How Sony lost Betamax
1 QUALITY OVER
QUANTITY Despite better picture quality, Sony's original Betamax tapes could record only one hour of video, while rival VHS tapes could store double that.
2 SECRET RECIPE
Sony initially failed to license its Betamax technology to a sufficient number of manufacturers, thinking it could go it alone. This led to a situation where VHS players competed against one another for share, driving down prices and making the format more attractive to consumers.
3 BUYING V. RENTING When both systems arrived in the United States in the mid-1970s, VHS machines were less expensive to rent. When consumers began to purchase rather than rent their video players, they tended to go with VHS machines. 4PORN CONUNDRUM Sony refused to license the Betamax technology to adult film companies, who turned to VHS tapes and ended up creating a multibillion-dollar industry.
How Sony won Blu-ray
1 BIGGER IS BETTER
Sony's Blu-ray discs can store upward of 50 gigabytes of data on a single disc, while HD DVDs hold about 30 gigs.
2 PLAYSTATION 3
By including a Blu-ray drive in its next-generation video game console, Sony was able to drive sales of both the PS3 and its new DVD format.
3 SOLID PARTNERSHIPS Not wanting to duplicate the Betamax mistake, Sony took the initiative to license its Blu-ray technology with as many partners as possible. When Blu-ray was first announced in 2002, Sony had already signed up eight partner companies committed to producing players.
4 CONTENT IS KING
By signing exclusive deals with more studios and content providers than Toshiba, Sony was able to squeeze its competitor to the sidelines. Warner's defection to Blu-ray was the fatal blow.
Matt Hartley
Dead technologies
Media formats we have used, loved and discarded for the next best thing
The cassette tape
A Walkman and roller skates, anyone? Tapes were the original portable format and made music pirates of us all. (Can I tape your Fleetwood Mac Rumors?) But they were hated by record companies. The sound quality tended to go tinny after a few dozen plays, and many tapes wound up melting in a car on a sunny day.
Eight tracks
Developed by plane maker Bill Lear, eight-track tapes were large and couldn't be rewound. And because of their high tape speed, didn't sound great. Nevertheless, they were popular in the 1970s, thanks to the auto industry, which installed thousands of eight-track players. When sales slipped, companies eager to pare formats quickly dropped the eight track. Vinyl
Cumbersome to play and easily damaged, albums faded out in the late 1980s. But album covers managed to become a genuine art form and another way to grab music buyers' attention. Lately, albums have a enjoyed a comeback, thanks to collectors, club DJs and scratching (ask your kids).
Compact discs
CDs are dead? They will be soon. Who needs all those plastic cases and discs when you can fill your hard drive and iPod with thousands of songs? Using a credit card, of course. Downloading music for free is wrong, isn't it?
Friday, February 15, 2008
Wal-Mart Expands In-Store Clinics
http://money.aol.com/news/articles/_a/wal-mart-expands-in-store-clinics/20080207065909990001
Wal-Mart Expands In-Store Clinics
By MARCUS KABEL,AP
(Feb. 7) -- Wal-Mart Stores Inc. will open its first in-store medical clinics under its own brand name after leasing space in dozens of stores to outside companies that operate the quick-service health stops.
Wal-Mart plans to open 400 cobranded walk-in clinics by 2010. "The Clinic at Wal-Mart" will jointly bear the names of Wal-Mart and its partners and have an identical look, prices and record keeping system.
The world's largest retailer said Thursday it will open "The Clinic at Wal-Mart " as a joint venture with local hospital systems in Atlanta, Dallas and Little Rock, Ark., starting in April.
Bentonville, Ark.-based Wal-Mart is among several U.S. supermarket and drug store chains that in the past couple of years have begun opening store-based health clinics, which are staffed mostly by nurse practitioners or physician assistants and offer quick service for routine conditions from colds and bladder infections to sunburn.
About 7 percent of Americans have tried a clinic at least once, according to an estimate by the Convenient Care Association, an industry trade group formed in 2006.
That number is expected to increase dramatically, as chains like Wal-Mart, CVS Corp., Target Corp. and Walgreen Co. partner with mini-clinic providers like RediClinic and MinuteClinic to expand operations. The trade group estimates there will be more than 1,500 by year-end, up from about 800 in November.
Wal-Mart has clinics in 77 stores, including nine in Wisconsin and Florida operated by local hospitals. Clinics in 23 locations in Florida and three other Southern states have been in limbo since last month when New York-based CheckUps shut down.
Now Wal-Mart has signed a letter of intent to work with local hospital systems and RediClinic to open cobranded walk-in clinics in 200 Wal-Mart Supercenters.
Wal-Mart has also signed a letter of intent to partner directly with St. Vincent Health System, a part of the Catholic Healthcare Initiatives system, to open four cobranded clinics in Little Rock.
Co-branding means the clinics will jointly bear the names of Wal-Mart and its partners and have an identical look, prices and record keeping system, Wal-Mart spokeswoman Deisha Galberth said.
Having the local hospital system involved will also increase the level of trust among shoppers, Galberth said.
Wal-Mart said this is the first step toward opening 400 cobranded clinics by 2010.
Retail analyst Patricia Edwards of San Francisco-based Wentworth Hauser and Violich said the move benefits Wal-Mart by giving the clinics added credibility.
"Especially among middle- and upper-income shoppers, it becomes more like stopping in at any location of their group health care provider. It doesn't have that connotation of going cheap," Edwards said.
Edwards said putting Wal-Mart's name on the clinics also fits with the retailer's drive for a public role in health care to counter union-led criticism that it skimps on employee health insurance.
Wal-Mart has introduced the clinics as well as $4 prescriptions for some generic medicines, and Chief Executive Lee Scott pledged last month to find other ways to help cut health care costs, including promoting the use of electronic health records instead of paper files.
Wal-Mart Expands In-Store Clinics
By MARCUS KABEL,AP
(Feb. 7) -- Wal-Mart Stores Inc. will open its first in-store medical clinics under its own brand name after leasing space in dozens of stores to outside companies that operate the quick-service health stops.
Wal-Mart plans to open 400 cobranded walk-in clinics by 2010. "The Clinic at Wal-Mart" will jointly bear the names of Wal-Mart and its partners and have an identical look, prices and record keeping system.
The world's largest retailer said Thursday it will open "The Clinic at Wal-Mart " as a joint venture with local hospital systems in Atlanta, Dallas and Little Rock, Ark., starting in April.
Bentonville, Ark.-based Wal-Mart is among several U.S. supermarket and drug store chains that in the past couple of years have begun opening store-based health clinics, which are staffed mostly by nurse practitioners or physician assistants and offer quick service for routine conditions from colds and bladder infections to sunburn.
About 7 percent of Americans have tried a clinic at least once, according to an estimate by the Convenient Care Association, an industry trade group formed in 2006.
That number is expected to increase dramatically, as chains like Wal-Mart, CVS Corp., Target Corp. and Walgreen Co. partner with mini-clinic providers like RediClinic and MinuteClinic to expand operations. The trade group estimates there will be more than 1,500 by year-end, up from about 800 in November.
Wal-Mart has clinics in 77 stores, including nine in Wisconsin and Florida operated by local hospitals. Clinics in 23 locations in Florida and three other Southern states have been in limbo since last month when New York-based CheckUps shut down.
Now Wal-Mart has signed a letter of intent to work with local hospital systems and RediClinic to open cobranded walk-in clinics in 200 Wal-Mart Supercenters.
Wal-Mart has also signed a letter of intent to partner directly with St. Vincent Health System, a part of the Catholic Healthcare Initiatives system, to open four cobranded clinics in Little Rock.
Co-branding means the clinics will jointly bear the names of Wal-Mart and its partners and have an identical look, prices and record keeping system, Wal-Mart spokeswoman Deisha Galberth said.
Having the local hospital system involved will also increase the level of trust among shoppers, Galberth said.
Wal-Mart said this is the first step toward opening 400 cobranded clinics by 2010.
Retail analyst Patricia Edwards of San Francisco-based Wentworth Hauser and Violich said the move benefits Wal-Mart by giving the clinics added credibility.
"Especially among middle- and upper-income shoppers, it becomes more like stopping in at any location of their group health care provider. It doesn't have that connotation of going cheap," Edwards said.
Edwards said putting Wal-Mart's name on the clinics also fits with the retailer's drive for a public role in health care to counter union-led criticism that it skimps on employee health insurance.
Wal-Mart has introduced the clinics as well as $4 prescriptions for some generic medicines, and Chief Executive Lee Scott pledged last month to find other ways to help cut health care costs, including promoting the use of electronic health records instead of paper files.
Sunday, January 13, 2008
Can Burt’s Bees Turn Clorox Green?
http://www.nytimes.com/2008/01/06/business/06bees.html
January 6, 2008
Can Burt’s Bees Turn Clorox Green?
By LOUISE STORY
IN the summer of 1984, Burt Shavitz, a beekeeper in Maine, picked up Roxanne Quimby, a 33-year-old single mother down on her luck, as she hitchhiked to the post office in Dexter, Me. More than a dozen years Ms. Quimby’s senior, the guy locals called “the bee-man” sold honey in pickle jars from the back of his pickup truck. To Ms. Quimby, he seemed to be living an idyllic life in the wilderness (including making his home inside a small turkey coop).
She offered to help Mr. Shavitz tend to his beehives. The two became lovers and eventually birthed Burt’s Bees, a niche company famous for beeswax lip balm, lotions, soaps and shampoos, as well as for its homespun packaging and feel-good, eco-friendly marketing. The bearded man whose image is used to peddle the products is modeled after Mr. Shavitz.
Today, the couple’s quirky enterprise is owned by the Clorox Company, a consumer products giant best known for making bleach, which bought it for $913 million in November. Clorox plans to turn Burt’s Bees into a mainstream American brand sold in big-box stores like Wal-Mart. Along the way, Clorox executives say, they plan to learn from unusual business practices at Burt’s Bees — many centered on environmental sustainability. Clorox, the company promises, is going green.
But not even Clorox can sanitize the details of a fallout between Mr. Shavitz and Ms. Quimby that began in the late 1990s — when Ms. Quimby managed to buy out the bee-man for a low, six-figure sum. She has been paid more than $300 million for her stake in Burt’s Bees, and she spends her time traveling, refurbishing fancy homes in Florida and preserving large tracts of land in Maine. Burt himself, now 72, makes his home again in the converted turkey coop — expanded but without running water or electricity — but with $4 million or so to his name.
As unlikely as their journeys have been, Ms. Quimby and Mr. Shavitz are pioneers in an entrepreneurial movement that has lately won the affection of corporate behemoths.
Clorox was willing to pay almost $1 billion for Burt’s Bees because big companies see big opportunities in the market for green products. From 2000 to 2007, Burt’s Bees’ annual revenue soared to $164 million from $23 million. Analysts say there is far more growth to be had by it and its competitors as consumers keep gravitating toward products that promise organic and environmental benefits.
In the last couple of years, L’Oréal paid $1.4 billion for the Body Shop and Colgate-Palmolive bought 84 percent of Tom’s of Maine, which makes natural toothpaste and deodorant, for $100 million. Clorox is also creating eco-friendly product lines of its own.
Many corporate leaders have sold their shareholders on green initiatives by pointing out that they help cut costs — an argument that is more persuasive now, while energy costs are sky high. But as companies rush to put out more and more “natural,” “organic” or “green” products, consumers and advocacy groups are increasingly questioning the meaning of these labels.
Clorox, for one, will face plenty of skepticism. Environmentalists have long said that bleach is harmful when drained into city sewers. The disinfectant has become a stand-in for jokes about chemicals and the environment, and a new round seems to have begun this fall when the company acquired Burt’s Bees.
“Who likes Burt’s Bees now that it’s been bought by Clorox?” Alison Stewart, a host on National Public Radio, said in November. “You know, just slap some bleach on your lips, it’ll all be good.”
Clorox executives have been fighting what they call “misinformation” about bleach for years. The company says that 95 to 98 percent of its bleach breaks into salt and water and that the remaining byproduct is safe for sewer systems. And Clorox sells many products that have nothing to do with bleach — including Brita water filters, Glad trash bags and Hidden Valley salad dressings.
Still, after Clorox agreed to buy Burt’s Bees last fall, scores of customers called Burt’s Bees and accused the company of selling out. John Replogle, the chief executive of Burt’s Bees, says he personally responded to customers who left their phone numbers.
“Don’t judge Clorox as much by where they’ve been as much as where they intend to go,” Mr. Replogle says he told them.
For her part, Ms. Quimby is at peace with the Clorox deal. “I feel the fact that I was able to sell the company accelerated the process of land conservation in terms of what I could do,” she says. “So if there is any negative karma, I’m neutral.”
BACK in 1984, at the end of their first summer together, Mr. Shavitz suggested that Ms. Quimby use some of his beeswax to make candles. She did, and the candles sold for $3 a pair at a crafts fair. Ms. Quimby then started experimenting, making beeswax polishes for shoes and furniture from recipes she found in an old farmer’s manual. Those products found some fans, but didn’t sell well.
When the pair incorporated as a company — in 1989 or 1991, no one can quite remember when — Mr. Shavitz owned one-third and Ms. Quimby owned two-thirds, she says. The famous Burt’s Bees lip balm was born in 1991, and that item, a combination of beeswax and sweet almond oil, helped the company find a niche in personal care products.
Mr. Shavitz was still active in the company in 1993, when they moved its base to North Carolina. Sales had reached $3 million a year, and they wanted to find a state with lower taxes and more workers to keep their business growing, Ms. Quimby says.
During this time, the couple had a falling-out, their romance became strained, and Mr. Shavitz decided to return to Maine. It is unclear exactly when he moved back permanently; Ms. Quimby said it was in 1993, but in a written response to questions, Mr. Shavitz implied that it was later.
What is clear is that Mr. Shavitz lost out on a huge payday. In 1999, Ms. Quimby bought out his one-third share in Burt’s Bees by buying him a house in Maine. Much grander than a turkey coop, the home cost $130,000, Ms. Quimby says. She now calls that figure “embarrassing” considering how much she made from the company.
Mr. Shavitz did not respond when asked if he hired advisers to determine whether he had been paid a fair valuation for his stake. He sold the house in Maine a few months after Ms. Quimby bought it for him because, she says, he missed his turkey coop. (He has since enlarged it to about 12 feet by 20 feet.)
By 2000, Burt’s Bees was pulling in $23 million in revenue, according to the company. Ms. Quimby said she had always intended to sell the company and had received offers for quite some time before she put it up for auction in 2003. That year, AEA Investors, a private equity firm in New York, paid Ms. Quimby $141.6 million for an 80 percent stake in Burt’s Bees. If Mr. Shavitz had held onto the stake he traded to Ms. Quimby for $130,000, it would have been worth about $59 million.
At the time of that deal, Mr. Shavitz demanded more money and Ms. Quimby said she agreed to pay him $4 million. Burt’s Bees also pays Mr. Shavitz an undisclosed amount each year for using his name and image on its products. Through a Burt’s Bees spokeswoman, Mr. Shavitz declined to comment on any payments he had received or the reasons for his fallout with Ms. Quimby. When asked if he and Ms. Quimby were still friends, Mr. Shavitz said, “Sure.”
“What happened between us in our personal relationship in the past is history,” he said in a statement. “The magic of living life for me is, and always has been, the magic of living on the land, not in the magic of money.”
Under AEA’s watch, Burt’s Bees products expanded into stores like CVS, Walgreens and Target. AEA hired Mr. Replogle from Unilever, where he was general manager for the company’s North American skin care business, to be chief executive. This fall, AEA accepted Clorox’s bid. Ms. Quimby sold her remaining 20 percent share in Burt’s Bees to Clorox for about $183 million.
Ms. Quimby, 57, now runs Happy Green Bee, a company that makes organic clothing for children. She says she spent more than $50 million to buy 100,000 acres where she tries to restore the land to its natural state by blocking hunting, closing roads and dismantling bridges.
In the meantime, the task of defending Clorox’s purchase of Burt’s Bees has fallen on Mr. Replogle’s shoulders. He says that in six months, he will post a blog on the Burt’s Bees site about whether he thinks Clorox is making enough progress on its green initiatives. He says Burt’s Bees’ 380 employees have an opportunity to influence the direction of Clorox, a company that generated $4.8 billion in sales last year and employs 7,800 people.
Burt’s Bees maintains its founders’ green philosophies. Employees’ bonuses are based in part on how well the company meets energy conservation goals, and there are prime parking spaces for staff members who drive hybrid cars or carpool. It buys offsets for 100 percent of its carbon emissions and is working toward a goal of sending no trash to landfills by 2020.
Mr. Replogle calls his current job a “mission” and says he is trying to reinvent business with an idea he calls “the Greater Good,” based on the founders’ ideals. The premise is that if companies are socially responsible, profit will follow. Burt’s Bees not only prioritizes the natural origin of its ingredients but also emphasizes animal rights, responsible trade, employee benefits and the environment.
Like most natural-products companies, Burt’s Bees has the luxury of charging enough for its goods to pay for such causes. A 0.15-ounce tube of Burt’s Bees basic lip balm, for example, costs $3. The same-size tube of ChapStick, which uses synthetic ingredients, costs $1.69.
Burt’s Bees is not perfect, Mr. Replogle acknowledges. The company obtains all of its beeswax from hives in Ethiopia, so shipping the ingredient across the Atlantic adds to carbon emissions.
LATELY, Burt’s Bees has started to police its industry. The company’s research lab is full of competitors’ products labeled “natural,” and employees of Burt’s Bees test those assertions.
Burt’s Bees has also led a group of companies that have teamed up with the Natural Products Association to create a standard for natural personal care products, complete with stickers to label items that make the cut. To qualify, brands must create products that are at least 95 percent natural and contain no ingredients known to be harmful. The stickers will make their debut in April.
Consumers “walk down the aisle in the grocery stores’ health and beauty area, and they’re confronted with ‘natural’ at every turn,” says Daniel Fabricant, vice president for scientific and regulatory affairs at the association. “We just don’t want to see the term misused any longer.”
To prove his own bona fides, Mr. Replogle grabs a bottle of Burt’s Bees avocado butter hair treatment, squeezes some onto his finger and dramatically licks it off. He then passes the tube to two Clorox executives so they can have a taste.
“If you can’t put it into your mouth, you shouldn’t put it on your skin,” he says. “I’d like to see other companies do that.”
Clorox says it is reshaping its product mix so that more of its products will be eco-friendly by its 100th anniversary in 2013. Two weeks ago, the company introduced Green Works, household cleaning solutions labeled as 99 percent natural. The last 1 percent consists of preservatives and fragrances.
Clorox says Green Works is more natural than all other cleaning products.
“It is the standard-setter,” says Beth Springer, vice president for strategy and growth at Clorox.
Green Works products are so new that outside groups have had little time to evaluate the company’s assertions. But Clorox says it believes that consumers will pay more for natural products. So, while they may be more expensive to produce, they will also be more profitable. Clorox research recently found that 53 percent of consumers planned to buy more eco-friendly products this year and that 47 percent were willing to pay 20 percent to 25 percent premiums for them.
While Clorox has decided to keep its brand off of Burt’s Bees products, its name is on the Green Works cleaning line.
“We spent a lot of time talking with consumers who wanted to keep their homes clean and healthy but wanted more natural alternatives,” Ms. Springer says. “And they confessed in most cases they were disappointed with having to pay more for products that didn’t work. So we concluded that we would initially bring it out with the Clorox brand name endorsing it because it gave people a belief in its efficacy.”
Then she lapses into Burt’s Bees speak as she continues.
“If we think about the Greater Good,” Ms. Springer says, “one lesson we’ve learned is, if you set your mind to the goal of more natural and sustainable practices, you might actually surprise yourself with what you can accomplish.”
January 6, 2008
Can Burt’s Bees Turn Clorox Green?
By LOUISE STORY
IN the summer of 1984, Burt Shavitz, a beekeeper in Maine, picked up Roxanne Quimby, a 33-year-old single mother down on her luck, as she hitchhiked to the post office in Dexter, Me. More than a dozen years Ms. Quimby’s senior, the guy locals called “the bee-man” sold honey in pickle jars from the back of his pickup truck. To Ms. Quimby, he seemed to be living an idyllic life in the wilderness (including making his home inside a small turkey coop).
She offered to help Mr. Shavitz tend to his beehives. The two became lovers and eventually birthed Burt’s Bees, a niche company famous for beeswax lip balm, lotions, soaps and shampoos, as well as for its homespun packaging and feel-good, eco-friendly marketing. The bearded man whose image is used to peddle the products is modeled after Mr. Shavitz.
Today, the couple’s quirky enterprise is owned by the Clorox Company, a consumer products giant best known for making bleach, which bought it for $913 million in November. Clorox plans to turn Burt’s Bees into a mainstream American brand sold in big-box stores like Wal-Mart. Along the way, Clorox executives say, they plan to learn from unusual business practices at Burt’s Bees — many centered on environmental sustainability. Clorox, the company promises, is going green.
But not even Clorox can sanitize the details of a fallout between Mr. Shavitz and Ms. Quimby that began in the late 1990s — when Ms. Quimby managed to buy out the bee-man for a low, six-figure sum. She has been paid more than $300 million for her stake in Burt’s Bees, and she spends her time traveling, refurbishing fancy homes in Florida and preserving large tracts of land in Maine. Burt himself, now 72, makes his home again in the converted turkey coop — expanded but without running water or electricity — but with $4 million or so to his name.
As unlikely as their journeys have been, Ms. Quimby and Mr. Shavitz are pioneers in an entrepreneurial movement that has lately won the affection of corporate behemoths.
Clorox was willing to pay almost $1 billion for Burt’s Bees because big companies see big opportunities in the market for green products. From 2000 to 2007, Burt’s Bees’ annual revenue soared to $164 million from $23 million. Analysts say there is far more growth to be had by it and its competitors as consumers keep gravitating toward products that promise organic and environmental benefits.
In the last couple of years, L’Oréal paid $1.4 billion for the Body Shop and Colgate-Palmolive bought 84 percent of Tom’s of Maine, which makes natural toothpaste and deodorant, for $100 million. Clorox is also creating eco-friendly product lines of its own.
Many corporate leaders have sold their shareholders on green initiatives by pointing out that they help cut costs — an argument that is more persuasive now, while energy costs are sky high. But as companies rush to put out more and more “natural,” “organic” or “green” products, consumers and advocacy groups are increasingly questioning the meaning of these labels.
Clorox, for one, will face plenty of skepticism. Environmentalists have long said that bleach is harmful when drained into city sewers. The disinfectant has become a stand-in for jokes about chemicals and the environment, and a new round seems to have begun this fall when the company acquired Burt’s Bees.
“Who likes Burt’s Bees now that it’s been bought by Clorox?” Alison Stewart, a host on National Public Radio, said in November. “You know, just slap some bleach on your lips, it’ll all be good.”
Clorox executives have been fighting what they call “misinformation” about bleach for years. The company says that 95 to 98 percent of its bleach breaks into salt and water and that the remaining byproduct is safe for sewer systems. And Clorox sells many products that have nothing to do with bleach — including Brita water filters, Glad trash bags and Hidden Valley salad dressings.
Still, after Clorox agreed to buy Burt’s Bees last fall, scores of customers called Burt’s Bees and accused the company of selling out. John Replogle, the chief executive of Burt’s Bees, says he personally responded to customers who left their phone numbers.
“Don’t judge Clorox as much by where they’ve been as much as where they intend to go,” Mr. Replogle says he told them.
For her part, Ms. Quimby is at peace with the Clorox deal. “I feel the fact that I was able to sell the company accelerated the process of land conservation in terms of what I could do,” she says. “So if there is any negative karma, I’m neutral.”
BACK in 1984, at the end of their first summer together, Mr. Shavitz suggested that Ms. Quimby use some of his beeswax to make candles. She did, and the candles sold for $3 a pair at a crafts fair. Ms. Quimby then started experimenting, making beeswax polishes for shoes and furniture from recipes she found in an old farmer’s manual. Those products found some fans, but didn’t sell well.
When the pair incorporated as a company — in 1989 or 1991, no one can quite remember when — Mr. Shavitz owned one-third and Ms. Quimby owned two-thirds, she says. The famous Burt’s Bees lip balm was born in 1991, and that item, a combination of beeswax and sweet almond oil, helped the company find a niche in personal care products.
Mr. Shavitz was still active in the company in 1993, when they moved its base to North Carolina. Sales had reached $3 million a year, and they wanted to find a state with lower taxes and more workers to keep their business growing, Ms. Quimby says.
During this time, the couple had a falling-out, their romance became strained, and Mr. Shavitz decided to return to Maine. It is unclear exactly when he moved back permanently; Ms. Quimby said it was in 1993, but in a written response to questions, Mr. Shavitz implied that it was later.
What is clear is that Mr. Shavitz lost out on a huge payday. In 1999, Ms. Quimby bought out his one-third share in Burt’s Bees by buying him a house in Maine. Much grander than a turkey coop, the home cost $130,000, Ms. Quimby says. She now calls that figure “embarrassing” considering how much she made from the company.
Mr. Shavitz did not respond when asked if he hired advisers to determine whether he had been paid a fair valuation for his stake. He sold the house in Maine a few months after Ms. Quimby bought it for him because, she says, he missed his turkey coop. (He has since enlarged it to about 12 feet by 20 feet.)
By 2000, Burt’s Bees was pulling in $23 million in revenue, according to the company. Ms. Quimby said she had always intended to sell the company and had received offers for quite some time before she put it up for auction in 2003. That year, AEA Investors, a private equity firm in New York, paid Ms. Quimby $141.6 million for an 80 percent stake in Burt’s Bees. If Mr. Shavitz had held onto the stake he traded to Ms. Quimby for $130,000, it would have been worth about $59 million.
At the time of that deal, Mr. Shavitz demanded more money and Ms. Quimby said she agreed to pay him $4 million. Burt’s Bees also pays Mr. Shavitz an undisclosed amount each year for using his name and image on its products. Through a Burt’s Bees spokeswoman, Mr. Shavitz declined to comment on any payments he had received or the reasons for his fallout with Ms. Quimby. When asked if he and Ms. Quimby were still friends, Mr. Shavitz said, “Sure.”
“What happened between us in our personal relationship in the past is history,” he said in a statement. “The magic of living life for me is, and always has been, the magic of living on the land, not in the magic of money.”
Under AEA’s watch, Burt’s Bees products expanded into stores like CVS, Walgreens and Target. AEA hired Mr. Replogle from Unilever, where he was general manager for the company’s North American skin care business, to be chief executive. This fall, AEA accepted Clorox’s bid. Ms. Quimby sold her remaining 20 percent share in Burt’s Bees to Clorox for about $183 million.
Ms. Quimby, 57, now runs Happy Green Bee, a company that makes organic clothing for children. She says she spent more than $50 million to buy 100,000 acres where she tries to restore the land to its natural state by blocking hunting, closing roads and dismantling bridges.
In the meantime, the task of defending Clorox’s purchase of Burt’s Bees has fallen on Mr. Replogle’s shoulders. He says that in six months, he will post a blog on the Burt’s Bees site about whether he thinks Clorox is making enough progress on its green initiatives. He says Burt’s Bees’ 380 employees have an opportunity to influence the direction of Clorox, a company that generated $4.8 billion in sales last year and employs 7,800 people.
Burt’s Bees maintains its founders’ green philosophies. Employees’ bonuses are based in part on how well the company meets energy conservation goals, and there are prime parking spaces for staff members who drive hybrid cars or carpool. It buys offsets for 100 percent of its carbon emissions and is working toward a goal of sending no trash to landfills by 2020.
Mr. Replogle calls his current job a “mission” and says he is trying to reinvent business with an idea he calls “the Greater Good,” based on the founders’ ideals. The premise is that if companies are socially responsible, profit will follow. Burt’s Bees not only prioritizes the natural origin of its ingredients but also emphasizes animal rights, responsible trade, employee benefits and the environment.
Like most natural-products companies, Burt’s Bees has the luxury of charging enough for its goods to pay for such causes. A 0.15-ounce tube of Burt’s Bees basic lip balm, for example, costs $3. The same-size tube of ChapStick, which uses synthetic ingredients, costs $1.69.
Burt’s Bees is not perfect, Mr. Replogle acknowledges. The company obtains all of its beeswax from hives in Ethiopia, so shipping the ingredient across the Atlantic adds to carbon emissions.
LATELY, Burt’s Bees has started to police its industry. The company’s research lab is full of competitors’ products labeled “natural,” and employees of Burt’s Bees test those assertions.
Burt’s Bees has also led a group of companies that have teamed up with the Natural Products Association to create a standard for natural personal care products, complete with stickers to label items that make the cut. To qualify, brands must create products that are at least 95 percent natural and contain no ingredients known to be harmful. The stickers will make their debut in April.
Consumers “walk down the aisle in the grocery stores’ health and beauty area, and they’re confronted with ‘natural’ at every turn,” says Daniel Fabricant, vice president for scientific and regulatory affairs at the association. “We just don’t want to see the term misused any longer.”
To prove his own bona fides, Mr. Replogle grabs a bottle of Burt’s Bees avocado butter hair treatment, squeezes some onto his finger and dramatically licks it off. He then passes the tube to two Clorox executives so they can have a taste.
“If you can’t put it into your mouth, you shouldn’t put it on your skin,” he says. “I’d like to see other companies do that.”
Clorox says it is reshaping its product mix so that more of its products will be eco-friendly by its 100th anniversary in 2013. Two weeks ago, the company introduced Green Works, household cleaning solutions labeled as 99 percent natural. The last 1 percent consists of preservatives and fragrances.
Clorox says Green Works is more natural than all other cleaning products.
“It is the standard-setter,” says Beth Springer, vice president for strategy and growth at Clorox.
Green Works products are so new that outside groups have had little time to evaluate the company’s assertions. But Clorox says it believes that consumers will pay more for natural products. So, while they may be more expensive to produce, they will also be more profitable. Clorox research recently found that 53 percent of consumers planned to buy more eco-friendly products this year and that 47 percent were willing to pay 20 percent to 25 percent premiums for them.
While Clorox has decided to keep its brand off of Burt’s Bees products, its name is on the Green Works cleaning line.
“We spent a lot of time talking with consumers who wanted to keep their homes clean and healthy but wanted more natural alternatives,” Ms. Springer says. “And they confessed in most cases they were disappointed with having to pay more for products that didn’t work. So we concluded that we would initially bring it out with the Clorox brand name endorsing it because it gave people a belief in its efficacy.”
Then she lapses into Burt’s Bees speak as she continues.
“If we think about the Greater Good,” Ms. Springer says, “one lesson we’ve learned is, if you set your mind to the goal of more natural and sustainable practices, you might actually surprise yourself with what you can accomplish.”
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