LIGHTSQUARED: FEW OPTIONS AFTER AN FCC DENIAL
U.S. regulators have rejected an effort by billionaire Philip Falcone to build a national wireless network, leaving the hedge fund investor few options to salvage his LightSquared venture. The decision also deals a blow to U.S. efforts to increase industry competition. The FCC said on Feb. 14 that it won’t let LightSquared, which aims to let people browse the Web at higher speeds, begin service. The move came after an Obama administration adviser said there was no way to prevent LightSquared’s network from disrupting the navigation gear used by planes, boats, and cars. Falcone’s hedge fund, Harbinger Capital Partners, has invested about $3 billion in the company.
AMAZON: FEWER PRIME MEMBERS THAN EXPECTED
Amazon.com’s (AMZN) Prime service, a linchpin of its effort to keep customers loyal and fuel long-term profit, has attracted fewer than half as many members as analysts had projected, three people familiar with the matter say. As of October, 3 million to 5 million people had enrolled in Prime, a program that provides two-day shipping for $79 a year, say the people, who asked not to be named because the figures are private. Analysts projected 10 million subscribers or more by the start of 2012. Amazon declined to comment.
ADIDAS: WOOING TEENAGE GIRLS
Adidas (ADS:GR) is looking to target teenage girls more influenced by music and fashion than sports. It plans to expand its NEO brand, which offers trendy styles such as metallic leather boots and uses social media to attract finicky teens. The company estimates the effort may bring in $1.3 billion in revenue by 2015. The three-year-old NEO line has made inroads in Russia, India, and especially China, where it has 1,000 stores. It’s now pushing into the more competitive Western European fashion market.
ROCHE: INVESTIGATING FAKE CANCER DRUG
Roche Holdings (ROG:VX) and the Food & Drug Administration are trying to find the source of a counterfeit cancer drug that’s being sold in the U.S. The FDA says 19 medical practices have bought a fake version of Avastin that lacks the medicine’s active ingredient, bevacizumab. The counterfeit drugs are labeled as Avastin manufactured by Roche, unlike real Avastin bound for the U.S. market, which notes on its packaging that it is produced by Roche’s Genentech unit. Roche says it wants to prevent further distribution of the fake drug.
CAPITAL ONE: NOW THE FIFTH-LARGEST U.S. LENDER
The Federal Reserve gave the go-ahead for Capital One Financial (COF) to buy ING’s (ING) U.S. online bank, clearing the way for the credit-card lender to add more than 7 million new customers with $80 billion in deposits. The $9 billion deal will make Capital One the fifth-largest U.S. lender by deposits. The Fed twice delayed announcing its decision about the acquisition, which consumer advocates such as the National Community Reinvestment Coalition said would decrease competition in the financial system.