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International -- Readers Report
The Internet Gives Consumers an Edge in Buying (int'l edition)
Peter Coy is ignoring the full picture in his description of companies fine-tuning their price strategies ("The power of smart pricing" Economics, Apr. 10). In this dot-com vs. bricks-and-mortar price war, price models must be calculated as revenue models to make a difference in the bottom line. It's time to realize that all vendors--those of the traditional and those of the "e" nature--must look to alternative revenue sources other than the consumer purchase price. It's time to get creative, because Internet technology gave consumers an edge in their buying power.
Alternative revenue models--for example, in the areas of advertising, e-coupons, and e-vouchers--are out there, and it will be the successful vendor who grabs them.
Yehud, IsraelReturn to top
Europe's Central Bankers Have Lost Credibility (int'l edition)
The argument that the euro is falling against the U.S. dollar because of growth and interest-rate differentials does not stand. In Japan, the yen is rising despite greater differentials in growth and rates ("Who's in charge of Europe's money," Cover Story, European edition, Mar. 27).
The major reason for the fall of the euro is lack of investor confidence in the 11 European governments that promised the strongest currency when the euro was launched at $1.17 and then started to support the fall even when it reached $0.95, claiming this was good for exports.
A more serious problem is that the euro is governed by amateurish "economists" who do not have the qualifications to manage a major currency. They have lost credibility, and their statements frighten rather than reassure investors. They never acted when their action could have helped.
The idea that a cheap euro is good for exports is shortsighted. They made the euro cheap, thus playing the game of their adversaries. Furthermore, they prevented capital flows and investments. Who dares invest in an economy where the only thing certain is that investors will lose on exchange rates?
BeirutReturn to top
Self-Regulation May Not Solve Internet Privacy Problems (int'l edition)
A letter from Federal Trade Commissioner Sheila Anthony "Finding a way to guard Net privacy" (Readers Report, Apr. 10) suggests that self-regulation has failed where Internet privacy is concerned. I would have to agree. She applauded the National Advertising Div. of the Better Business Bureau for its success at self-regulation and implied that a similar effort would work (to some degree) with the Internet privacy issue.
The commissioner missed an important point. The NAD works because it is in the interest of advertisers to "police" each other. The complaints filed with the NAD are filed by advertisers who are protecting their own businesses. They watch each other like hawks to make sure one firm doesn't gain an unfair advantage over another by using false or inflated claims in advertising.
The same situation does not exist where Internet privacy is concerned. The actions of one firm, inappropriately collecting, using, or selling information on consumers, does not have an immediate impact on the competitors as does a false advertising claim. While I don't favor heavy-handed government regulation of the Internet, I wouldn't count on a NAD type of model being developed in the industry either.
University of Maryland in Europe
Ramstein, GermanyReturn to top