"We're running out of phrases to describe our results in recent quarters, but clearly they are unacceptable." --Northwest CEO Doug Steenland, warning that the carrier may have to seek bankruptcy protection
Microsoft (MSFT) has never been keen to acknowledge competitors. But would it go so far as to wipe Apple Computer (AAPL) off the earth? If you use MSN's new Virtual Earth mapping site to search for Apple headquarters at 1 Infinite Loop in Cupertino, Calif., the campus is conspicuously absent from the aerial photo. Instead you see the circular shape of the street superimposed over a nearly empty lot. Apple had built and moved in there by 1993. Put similar info into the rival Google (GOOG) Earth program and up pops Apple headquarters.
Mac enthusiasts on Web sites assumed the omission was deliberate following Virtual Earth's July 25 launch. The more likely culprit: musty satellite photos. Virtual Earth's Silicon Valley images can be as old as 1991, explains general manager Stephen Lawler. Google didn't return calls seeking the age of its images. But Chris Sherman, editor of SearchDay newsletter, says they're newer. After Google Earth premiered in June, Microsoft "rushed to get its beta version of Virtual Earth out the door. It definitely has rough edges."
Lawler says Microsoft will update photos as users complain. Some updates will come in the fall, when it rolls out photos taken at a 45-degree angle, revealing more than rooftops. But until Apple's headquarters come into focus, conspiracy theorists won't quit.
The bill, or part of it, has come due for May's big credit-card heist. Fraudulent charges from the computer hack at Atlanta-based credit-card processor CardSystems so far have cost JPMorganChase (JPM), the nation's No. 3 bank, up to $4 million, according to a source familiar with the matter. Chase execs won't confirm or deny the figure, and CardSystems didn't respond to requests for comment. While dwarfed by Chase's $1.2 trillion in assets, the losses are the first to be revealed for a big bank from the recent spate of cyberscams. That's not surprising. Outfits such as Chase, Bank of America (BAC), and Citigroup (C) fear that acknowledging even small losses will undermine confidence in online banking. And criminals aren't boasting. "Hackers and virus writers are not looking for big splashes," says Gregg Mastoras, senior analyst at security firm Sophos.
The CardSystems break-in allegedly compromised 40 million credit cards, though executives told Congress only 239,000 unique numbers were actually pilfered. Visa and American Express (AXP) said on July 18 they will stop using CardSystems, though talks are expected to resume. The threat to CardSystems could increase as more banks tote up their losses.
Al Gore says he is trying to democratize TV by involving viewers in creating shows. But the former Vice-President's approach to advertising is just as radical. When his Current TV cable channel launches on Aug. 1, it will replace traditional half-hour or hour-long shows with 15-second to five-minute programs, or "pods," to appeal to the thin attention spans of 18-to-34-year-olds. Advertisers sign up for 15-month exclusive sponsorship of the 40 pods, which run in groups of 10 every hour. Their logos will appear at the start of each segment, and a message of up to a minute runs at the end. Every hour, one sponsor runs a three-minute message.
The idea is to sweep away ad clutter by cutting the number of messages, while breaking free from the 30-second format. Advertisers say the approach is refreshing. But some are balking until they know more about the programming, how ads are structured, and how well cable systems respond. "Current is pretty forward-looking, but we're taking a wait-and-see attitude," says Jason Maltby, a co-president at ad agency MindShare. Gore's revolution still needs to find some true believers.
Steve Madden can afford more than prison shoes these days. Released in April after 41 months in federal prison for stock fraud and insider trading, Madden has a hefty 10-year con-tract from the shoe company bearing his name. An SEC filing, posted on Footnoted.org, says Madden's salary as creative director drops $100,000, to $600,000. But he gets an "expense allowance" of $200,000, at least 2.5% of revenues for new ventures, and at least 10% of new licensing revenue above $2 million. The company says Madden's pay is directly tied to performance. "Who better to guide the brand but the visionary himself?" says brand manager Robert Schmertz.
Levi Strauss launched its Signature discount jeans in 2003, insisting they wouldn't cannibalize Levi's Red Tab department-store jeans. But that distinction may be fraying. Under pressure to boost sales, Levi's is rolling out Authentics, a line of $25 trendy jeans for Wal-Mart (WMT) and other discounters. That's dangerously close to similar-looking $30 Red Tabs. Sears (SHLD) and J.C. Penney (JCP)say they're not worried, and Signature chief Scott LaPorta insists the jeans "will not compete." But Levi's strategy may look threadbare if buyers flock to the knockoffs.
David Sifry is relentless in evangelizing the importance of blogs to business. "You can either choose to listen or choose not to listen," says Sifry, 36, CEO of Technorati, the leading blog search engine. "Either way, people are talking about your company, they're talking about your product, they're talking about your competitors." In August, Sifry will press the point when he rolls out a subscription service for customized searches so users can track buzz about their companies.
But with giants Google (GOOG), Yahoo! (YHOO), and MSN (MSFT) seemingly poised to enter blog search, it's not clear whether Technorati, with its relatively tiny server capacity and name recognition, can compete. Despite big growth in the number of blogs it tracks -- now 13.3 million -- Technorati is slow and erratic, bloggers complain. Sifry attributes that to the ambitious task of tracking both relevance and timeliness. Sifry, a serial entrepreneur, says his goal "is to build something great." Users, he's betting, will follow.
Gasoline prices are sky-high, and so are oil company profits. Maybe that's why Big Oil seems so self-conscious these days. Industry ad spending is up sharply, which includes some image-polishing public awareness campaigns. The four largest international oil companies, ExxonMobil (XOM), Chevron (CVX), BP (BP), and Royal Dutch Shell (RD), hiked their combined ad purchases by 37% through May, to $138 million, according to research firm TNS Media Intelligence. That's after a healthy 15% increase for 2004, to $330 million.
Oil companies say they are just trying to raise awareness of energy issues during a period of high prices. It doesn't hurt, of course, that Congress has been mulling over an energy bill loaded with goodies. BP's "BP on the Street" campaign features interviews with real-life consumers saying things such as: "I'd love a clean environment. But give up my car? That's like asking someone to give up chocolate." On July 5, Chevron introduced a global campaign directing viewers to a Web site that counts off the number of barrels of oil consumed while you visit it.
Environmentalists say the ads amount to "greenwashing." Jessica Coven, a global warming campaigner at Greenpeace, would rather see the millions spent to cut greenhouse gas emissions. Spokesman Tom Cirigliano says Exxon hasn't increased its image-related ads, but says it has cut greenhouse gas emissions: "Since these figures aren't 'sexy' enough to be picked up by the mainstream media... we've had to go to advertising to get our message to the public."
Most hotel chains reward loyal guests with points toward a free stay. Jameson Inns (JAMS) is going one better: Patrons who stay more than three nights a year at its 123 Jameson or Signature Inns, in the Midwest and South, earn Jameson Inns shares worth 10% of their nightly room rate. The Atlanta hotelier thinks the program, launched with Securities & Exchange Commission approval on July 1, can generate more traffic: "I've heard enormous interest from customers, guests at hotels, people who are already staying with us, [and] people who have never tried us," says David Vining, vice-president of marketing.
The program already may have helped boost Jameson's stock price. The shares trade at around $2.40 -- about a quarter of their 1998 high, but up more than 22% from Jan. 1. Jameson has also started a separate plan to sell stock, commission-free, to customers. Hey, if the hotel guests consider themselves shareholders, maybe they won't steal towels.