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In Business This Week: Headliner
Gail McGovern: Leading Fidelity's Online Charge
Fidelity Investments remains the biggest player in the mutual-fund business. But the goliath with $995 billion in assets has been unable to break away from the pack in the fast-growing online brokerage field. Look for that to change.
On Jan. 25, the Boston-based firm announced a major reshuffling of the top execs overseeing its push online. Gail McGovern, the former AT&T marketing exec who became Fidelity's senior operating officer for retail brokerage in late 1998, was named president of Personal Investments, which oversees Fidelity's brokerage and fund-marketing lines.
McGovern takes over just as Fidelity is picking up speed online. Last year, Fidelity put on a marketing blitz, funded in part by a $1 billion bond offering, and rose from an also-ran in online brokerage to No. 4 in market share. Now McGovern, 47, will have Fidelity's hottest job, outside of running a mutual fund, and become the company's top employee behind Chairman Ned Johnson and President James Curvey. "My job is to keep the momentum going," she says.By Geoff Smith in Boston; Edited by Mark FrankelReturn to top
Chrysler's Eaton Takes an Off-Ramp
DaimlerChrysler co-chairman Robert Eaton is hitting the road. The chief executive who signed the deal to merge America's third-largest carmaker with Germany's Daimler Benz two years ago resigned on Jan. 26. Eaton had indicated that he might stay for up to three years after the merger--a reassuring gesture for Chrysler employees. But there have been increasingly frequent reports of friction between Eaton and his co-chairman, Jurgen Schrempp, who has placed his own executives in most top jobs. Insiders say Eaton hastened his departure with loose talk at the Detroit car show, where he told reporters that DaimlerChrysler will shed non-core units such as rail division Adtranz and financial services division Debis. The disclosures did not sit well back in Germany.Edited by Mark FrankelReturn to top
Sprint Hangs Up on Global One
Sprint finally cut its ties with partners in the feuding Global One venture on Jan. 26. After months of searching for ways to pull out of the transatlantic partnership, Sprint agreed to sell its stake to Deutsche Telekom and France Telecom for more than $1.4 billion. The exit gives Sprint a leg up on its pending merger with MCI WorldCom. Were Sprint to remain a Global One partner, regulators would likely frown on the overlap in international capacity with MCI WorldCom, itself a robust international carrier. Sprint's Global One customers will be covered by a two-year transition plan. And the European companies--each of which holds a 10% stake in Sprint--will vote their shares in favor of the MCI deal if the merger is approved by regulators.Edited by Mark FrankelReturn to top
Priceline: Bidding in Many Tongues
Name your own price--and not just in dollars, but in marks or francs or yen. "We're ready to go international," says Priceline.com CEO and Chairman Rick Braddock who announced the Internet buying site's first venture outside the U.S. Priceline announced a partnership with Hong Kong's Hutchison Whampoa on Jan. 26. The licensing deal--which could expand to a 50% equity stake for priceline.com--will let people in Asia bid for airline tickets online. The site says it may top $1 billion in revenue this year--more than double 1999. No profits yet, Braddock says, "but we'll continue to narrow our losses."Edited by Mark FrankelReturn to top