"It is time to invest in America." -- House Speaker Dennis Hastert, calling on oil companies to ease the pain of high energy prices by investing more of their record profits
Any 16-year-old can tell you that logging on to MySpace.com is as vital to teen culture as showing your face at the right party. Now, with 34 million users, the social networking site is becoming a can't-miss for advertisers as well. During September, 1 out of 10 ads viewed on the Internet was seen on MySpace, according to Nielsen//NetRatings. Only Yahoo! (YHOO) and MSN (MSFT) boast higher ad views. That reflects MySpace's rising visibility: Users have nearly quadrupled since January. Advertisers also are intrigued by the relatively low cost of a campaign -- $80,000 to $300,000 for four to six weeks -- to reach the fickle teen audience. Procter & Gamble (PG), for instance, recently sponsored profiles for Hilary Duff and other pop stars. "It's an experiment for us," says a spokesperson for P&G's Secret Sparkle Body Spray.
With backing from new owner News Corp., (NWS) MySpace co-founders Tom Anderson and Chris DeWolfe are experimenting, too. They plan to launch a MySpace record label, film production company, and satellite-radio station. They are even considering a mobile service to go up against teen-targeted cell-phone plans from Sprint Nextel's (S) Boost Mobile and Virgin Mobile.
You can be too popular on the Web. Just ask Mini-Microsoft, the anonymous blogger who works inside the software giant and opines about corporate bloat. Mini had a small but thoughtful audience before BusinessWeek profiled him ("A Rendezvous with Microsoft's Deep Throat," Sept. 26). Then he made C/Net's Blog 100 list. Traffic to the blog exploded. Mini's posts, which had gotten as many as 50 responses apiece, got hit with 250 or more. Quantity outran quality. Microsoft (MSFT) software developers and testers sniped at one another. Blog squatters from the outside set up shop and derailed discussions to such random topics as the effects of the Redmond, Wash., weather on Microsoft's workforce. Mini's message was getting lost.
So on Oct. 15, Mini flipped the digital switch, preventing readers from commenting on his posts. "I grieve the loss of comments, as I'm sure a lot of you do out there," Mini wrote. "It was just becoming harder to find the gems in the middle of egregious brain-misfires." But the result wasn't the riveting water cooler readers had come to expect. So on Oct. 24, Mini backtracked, writing that he'd turn comments back on. Now he'll spend more time filtering out the blather.
Spare a thought for Japan's future retirees. Until recently, your average salaryman had every right to expect a comfortable old age cushioned by a hefty golden goodbye payout at 60, plus ample monthly pension checks. Today, those benefits are under attack.
At the state level, the Koizumi government is pressing ahead with social security reforms. When passed into law, they will almost certainly trim state pension payouts while raising taxes to offset a growing pensions shortfall as Japan's population grays. What's more, companies are getting in on the act. Following the example set by U.S. counterparts, Japanese employers are dumping defined benefit pension schemes in favor of cheaper alternatives. According to Greenwich Associates of Greenwich, Conn., a quarter of Japan's defined benefit plans will be closed to new employees by 2008, compared with just 6% two years ago. By 2015, only half of Japanese corporate pensions will be of the defined benefit type, Greenwich expects. "A generational shift has begun regarding corporate responsibilities for workers' retirement," says William Weschler, a consultant at Greenwich.
U.S. 401(k)-style plans will fill some of the gap. They had over 1.25 million subscribers in Japan through March, a 78% rise from a year earlier. Reforms are needed: Assets of the typical Japanese pension fund cover only 83% of liabilities. With the proportion of Japan's 65-plus population set to rise from 19.5% today to 27.8% by 2020, tougher times for the silver set are just beginning.
CEOs see their faces emblazoned everywhere from the company Web page to the annual report. But only a select few are immortalized on latch-hook rugs. Using Photoshop and hand-knotted yarn, Brooklyn artist Rob Conger has created 2.5-by-2-foot latch-hook portraits of some of the most charitable CEOs. Included are John Rowe of Aetna (AET), James Dimon, now president of JPMorgan Chase (JPM), and Phil Condit of Boeing (BA). "The minute I put down my hook" Condit resigned, says Conger. "I was like, whoops." Earlier works, such as Alan Greenspan, sold quickly to CEOs and other collectors. The latest rugs are available at Conger's gallery, Mixed Greens, for $4,000 each.
Cendant Chairman and CEO Henry Silverman is back in dealmaking mode. But this time, he's breaking things up -- announcing on Oct. 24 that the real estate and travel conglomerate will split into four publicly traded operations next summer. "Having built this business over 15 years, disaggregating it is emotionally wrenching," says Silverman, 65. He had argued that Cendant hedged against travel and real estate cycles, but investors didn't reward that complex model. Now they seem more focused on Cendant's weakening business prospects. The same day Cendant announced the overhaul, it lowered earnings guidance for the fourth quarter and all of 2006; its travel units have been hit by factors like terrorism and hurricanes. That day, the stock sank 7%, to 18.77.
Silverman argues that his breakup plan will still create billions of dollars in value. He will lead the new travel company, including online businesses. He figures he will step down in a couple years when prot?g? Samuel Katz is ready to take the helm. What then? "I hope I'm healthy, and I'll worry about it [later]," says Silverman.
A new study of minorities in corporations finds that African Americans, Asians, and others are held back by subtle discrimination. Princeton University professor of religion Cornel West and economist Sylvia Ann Hewlett discussed their findings with Senior Writer Nanette Byrnes:
Q: The people you spoke with seem to feel they have to act like white men to get ahead.
Hewlett: There's this great phrase "bleached-out professionalism." That describes this shrinkage of authenticity, which in the end is very debilitating and by definition not successful. You just can't turn yourself into a white guy.
Q: What does it mean to act like a white guy?
Hewlett: A lot of Asian executives we interviewed thought that they were way too quiet. African American executives, on the other hand, often felt they came over as too loud, too brash. They felt this loudness labeled them as potential troublemakers.
Q: Isn't the superficial sometimes important -- the trust inspired by a banker's suit, etc.?
Hewlett: But a lot of the things they're talking about you basically can't change. They feel they're not allowed to bring their whole self to work. A woman who was in one of our focus groups was 32. She had been promoted three times since business school -- a highflier. In her spare time she founded a Girl Scout troop in a homeless shelter. Do you think her colleagues knew about it, or her boss? No. It was kind of her choice, but she said the culture of this company is that if you are on the board of the symphony, it's O.K. United Way is O.K. But the community involvement of minority professionals is often not on the list.
Q: Is it possible white men are getting ahead faster because they're working harder?
West: There's no getting around sacrifice, excellence, and quality. We're talking about style: how one talks, relates, and balances their life. We're talking about a deepening and refining of values.
Q: What shocked you?
West: The most frightening fact is that 52% of the minority folk don't have deep trust in their company and the people who run it. We're already dealing with distrust of the government. We don't need more isolation.
WHY READ IT: A rich clearinghouse on constitutional law. Scotus links to blogs, articles, and podcasts on the Supreme Court. A click carries readers to a sister site, The Supreme Court Nomination blog (sctnomination.com/blog), on the Harriet Miers dustup.
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NOTABLE POST: Details of legal wrangling as terror suspect Zacarias Moussaoui seeks to avoid the death penalty. "[P]ictures of thousands of victims would be kept out [of the first stage of a jury trial], giving Moussaoui what his lawyers hope would be a better chance of convincing the jury that he is not eligible for a death sentence."
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