Posts Tagged Under ‘Business’

Dudes, Why So Much Debt?

The Wife and I had a good discussion today sparked by Sunday’s first piece in the New York Times series on debt in America. (And thanks to J Frog for sending me that way today.)

I did learn a nice history of the lending industry from the article, in particular the industry’s shift in focus from demanding repayment to collecting fee-based income off of ever-rolling debt. While the credit-card industry, and certainly the mortgage industry of the past few years, often embodies the term “predatory capitalism”, it does seem that the article shifted too much of the onus for America’s debt problem away from the public. This is similar to media outlets who generally avoid putting any blame on the voting public for America’s political messes, for obvious business reasons. (What audience wants to be told that it’s the proverbial box of dull tacks? I prefer my mental tack sharp, thanks.)

Maybe I’m too harsh, though, because the writers and editors might have been making a point on the sly about the general public by choosing the subject that they did. Ms. McLeod — no relation to Connor, who has a far better repayment cycle with which to work — really makes one unfortunate (read: not well-thought-out) decision after another. From spending her already debt-addled medical recovery cruising QVC, to adding her 20-year-old son onto her second home-refinancing and ruining his credit too, I really don’t understand what made her do what she did.

So that raises the question: What really has made debt-laden ‘Mercans turn away from the admirable saving habits of back in the not-that-far-off day? Why is “I gotta have it” such a seemingly more powerful motivator across society now than it was then? This was the topic of conversation between The Wife and me. We came to one important conclusion that’s both seemingly unrelated but not that surprising: television.

The modern debt cycle really started to germinate at about the time the TV-raised Boomer generation was earning enough money to buy homes, sign up for credit cards and pop out Millennials like your gracious host. Boomers had grown up with TV, which based on its sheer volume of audio and visual stimulation was inevitably packed full of product pitches and brand names. Sure, their parents — the Greatests — were watching TV too, but the Depression experience burned the saving ethic into their parents’ heads for life. Greatests learned back then to do things like wearing the same six velour jumpsuits for 30 years. (Which is smart — over time this actually becomes cool, what with the roundabout cycle of retro hipness.)

Boomers weren’t about to wear velour jumpsuits; velour is too hot in summer, and after a childhood of American prosperity and the enveloping nature of TV advertising, they had to get that fine narrow-lapel suit to go with the Commodore 64 for the kids. Advertisers, too, were well-aware of just how good a job TV had done to implant the “buy stuff” message into America’s collective mind. Over time they shifted from making their products attractive to making access to their products a moral right — “You deserve a break today” and “Live richly”, not just “Our McNuggets taste totally rad” and “Hey, peep out this low interest rate.” This newly created sense of entitlement grew strong until too many people didn’t bother to use their better instincts, and the things they felt they needed encompassed even luxury goods that were previously — and still probably should be — considered impractical on the average income. Cue up many of my generational peeps growing up in this environment, who should nonetheless know better than to spend that percentage allotted for savings on Manhattan rent and cosmopolitans, and the cycle continues. (Also, thank you, Mom and Dad, for teaching me how to save cash and how to avoid becoming a spoiled jagoff.)

In conclusion, if we didn’t have TV, we might not have a subprime mortgage crisis and government bailouts of Fannie Mae and Freddie Mac. The end.

The Top News Outlets for May 2008

Just saw this list of the most popular online news sources from Nielsen Online.

Brand or Channel — May ‘08 Unique Audience (000) — May ‘07 Unique Audience (000)

Yahoo! News — 35,846 — 30,451
MSNBC Digital Network — 35,184 — 28,347
CNN Digital Network — 33,101 — 29,094
AOL News — 22,524 — 17,444
NYTimes.com — 21,340 — 12,775

Tribune Newspapers — 16,238 — 13,300
Gannett Newspapers and Newspaper Division — 14,629 — 12,645
Google News — 11,356 — 9,359
ABCNEWS Digital Network — 11,124 — 10,211
USATODAY.com — 10,785 — 9,528

Fox News Digital Network — 10,132 — 7,594
CBS News Digital Network — 9,225 — 8,620
washingtonpost.com — 9,204 — 8,613
McClatchy Newspaper Network — 9,131 — 9,885
Hearst Newspapers Digital — 7,955 — 8,380

WorldNow — 7,523 — 6,232
MediaNews Group Newspapers — 6,965 — 6,189
Slate — 6,456 — 3,856
Advance Internet — 6,202 — 6,006
IB Websites — 5,943 — 5,203

BBC News — 5,933 — 6,554
Cox Newspapers — 5,826 — 3,949
Belo Television — 5,354 — 3,301
Topix — 5,133 — 4,411
Boston.com — 4,962 — 4,038

Gannett Broadcasting — 4,735 — 3,030
TheHuffingtonPost.com — 4,715 — 1,327
Associated Press — 4,527 — 8,191
Belo Newspapers — 4,462 — 2,417
Fox Television Stations — 4,386 — 3,451

I’m happy to see so many newspaper companies are cracking the list. The audience is there; we just need to use that more effectively to make money and keep things going. It’s also good that the big news sites like Yahoo!, AOL and MSN beat out Google News by so much: the first three still have a human element at play in editing, proving that context really does matter.

So good news to all you editors: for now, you still can’t be replaced by robots.

Reading Recs

I recently read and enjoyed the following, so feel free to hook that up for yourself:

• This UK Daily Mail profile of John McCain’s first wife. I had always heard about his first marriage, but knew next to nothing about it. Definitely a sensationalist source, but an unflattering new look.
• An article on the prevalence of skulls by Stephen Marche in Esquire. There’s no link to it on their site, so you can just read this other description of it. Who doesn’t like a memento mori?
• This inspiring article from the Chicago Tribune magazine about a woman in Roseland (a nasty part of Chicago) who started her own anti-violence group for the teens in the neighborhood.

Good on ya.

MSNBC: Just Filling the Niche, So Relax

Today I was reading this WP article about MSNBC’s left-leaning slant and found myself wondering why dudes were fussing.

MSNBC has exactly two prominent liberal commentators, Keith Olbermann and Chris Matthews. We can pare that down to one because Matthews is usually unwatchable and isn’t really that liberal anyway. (He did vote for Bush in 2000.) So you have a network’s reputation being made off of one smart-assed commentator–full disclosure, I do like Olbermann most of the time–who makes most of his publicity off of YouTube replays. Nor do I see how David Gregory, Tim Russert and Andrea Mitchell count as partisan in any way when compared with the likes of Brit Hume and Shephard Smith.

But, let’s assume MSNBC is slanting to the left. McCain and Clinton spokespeople have to rail against any loud voice that ostensibly opposes them, but I wish those kind of complaints–and the ones against Fox News–were recognized more often for what they are: empty gestures ignoring the underlying reality that these networks exist because there’s a market for the slant they’re selling. Protest the viewing public that keeps your favorite target network going, and then you’re on the right track.

The media is a special business because of the effect it has on society, but it is still a business where resources flow to any open opportunity. In NBC / GE’s case, that was for a mildly liberal network that’s happy to scrap with conservative rivals. There’s thus little point in being mad at them for slanting. I think it’s digusting and hilarious that KFC has found a market for the Famous Bowl, but getting mad at KFC for following the dollars is the wrong way to go. They aren’t a 1950s cigarette company keeping a lid on the fact that fatty food is bad for you–we as a nation are clearly aware of it, but plenty of us still clamor for gravy with cheese.

TV is no different. It’s a market, and getting your news from TV is a bad decision in the first place. (Nearly every time “the media” catches flak for being too dumb, it’s really the televised media, but that’s for another post.) So get pissed all you want at MSNBC, McCain and Clinton staffers, but it’s not going to stop the gravy-and-cheese train.

I’m New to the Job Thing and Into Web Media. What Systems Should I Learn?

I feel like I’ve run into iterations of this question a few times lately, so here go some words of whizzzdum.

If I were some 21-year-old dude again, but my 21-year-old self was transported to 2008 and I was looking for a job in media websites, I’d pick up some books on the following languages at SBX. I could stop in during my next trip to EV-1 for a Busch Light 30-cube. ($10.99, readers. But that was in 2001 prices. I imagine with the surge in grain prices, it’s gone all the way up to 46 cents per beer or so.)

The geek glasses know

First, I’d learn Flash. Front-end developers can do really well with this, even though I think it’s a really bad idea to use Flash for basic page templating. Instead, Flash is awesome for news graphics, such as the popular delegate calculator we rocked at Slate. It’s really portable for things like embedded video players and widgets (see the Bushisms widget), it can do great visual effects that DHTML still can’t do with ease (or at all), and it’s a lot less dangerous than Javascript for site stability. If your swf file is f’d, it’ll take down your movie but likely not your site performance. (Unless it’s way huge and you’re seeing too many downloads, but file size is a problem for anything.)

Second, I’d get really good at CSS. It’s the best way to control page display, so clearly it’s mad useful. The HTML part is fairly simple; you’re just wrapping things in divs of different class and ID. Then the CSS comes into play and keeps your site looking tight.

Third, I’d learn object-oriented programming. It’s the basis of Javascript behaviors and used in back-end programming as well, and that’s across all platforms. ASP.NET, Java or PHP, you’ll want to know the underlying structures. And that’s once you know basic programming stuff like loops, conditionals and database connectivity; if not, learn that first.

Assuming you already have the media knowledge down — journalism and such — you’d be representin’ for an entry-level producer or front-end developer job. Other useful technologies include Photoshop, Illustrator, QuarkXPress (for the occasional print thing), IIS or Apache server admin, and database structure. That last one is obviously useful in general web development, but I’m assuming you’re looking for a job with a media company big enough to have its own DBAs.

As far as the PHP / open-source question, I definitely advise people to learn it, but I say that with the knowledge that you probably won’t be using it working for a media company in the next few years. PHP is great and I love all the innovation around it, but most companies are still running legacy systems in ASP.NET, Java or other technologies and will bust out some criticism about scalability and support issues if you suggest moving to PHP / MySQL. (Facebook apparently not being large-scale and uptime-critical enough.) So, while PHP is great if you want to set up a site from scratch and will be useful when it becomes more supported with big sites, you probably won’t need it on a day-to-day job basis.

Apologies to any non-code people who were bored stiff on this one.

Saved

Ignore my previous dour economic analysis. I just got this in the mail:

Dear Taxpayer,

We are pleased to inform you that the United States Congress passed and President George W. Bush signed into law the Economic Stimulus Act of 2008, which provides for economic stimulus payments to be made to over 130 million American households. Under this law, you may be entitled to a payment of up to $600 ($1,200 if filing a joint return), plus additional amounts for each qualifying child.

Our national woes are over, thanks to this $600. ($1,200 if filing a joint return — that’s me now! Even better!)

Our $1,200 will go right into my Citibank money-market account, so at least I’m doing my part to prop up the personal-banking arm of one of America’s crucial investment banks. Holla!

Going A Bit Too Far With Web Advertising

I’m all for innovative Internet advertising — it puts enchiladas on my table — but Phorm’s plan for tracking users’ comprehensive Internet behavior via their ISP seems a bit overboard. The privacy concerns are obvious, so I’ll come at this from a business perspective.

Phorm on its face is obviously bad for individual media outlets, whose perspective I’m admittedly favoring: this all-sites-visited method of advertising prompts advertisers to buy based on users’ web behavior as one singular package, not separate entities grouped by the aforementioned individual outlets. The ability for each individual outlet to tailor its advertising message to its particular clients is thus diminished: this is ultra-individualistic without taking into account what visitors to, say, the New York Times have in common with other visitors to the Times‘ site. But I think this all-the-web approach is inconvenient for advertisers: Instead of buying up space on NYTimes.com based on the common interests of the Times’ audience, advertisers are going to have to do their own aggregating work to design a broad base of characteristics that somehow coincide with each other. The NY Times can provide demographic info on its audience and advertisers can reach that audience by buying on the NY Times, but how is a company wanting to reach a targeted group going to isolate that group based on their visiting tons of different sites? Phorm could probably aggregate packages of user characteristics and sell those, but it’s an issue nonetheless.

There’s also the much bigger problem of having every potential site that the user visits opt into this advertising network — it’s either that or put some sort of ISP-based spyware onto the user’s machine to serve up desktop ads. Serving advertising over top of other sites’ own advertising is a recipe for being sued, and desktop ads always drove me nuts with various file-sharing services. And that was back in the day of 2000, so I doubt users have grown an appetite in the time since.

I’ll leave the very legitimate privacy concerns to other peeps — like the New York state legislature — but I think that Phorm as an ad strategy doesn’t really address the all-important point of finding appropriate inventory for your ads.

On a related note, I think the quadrantONE network is a great idea for newspapers, but what I really want to see the network do is get into local-market ad production and sales. Once newspapers provide effective venues for small businesses to advertise online as they do now in print — the production issues in creating web ads obviously have a different set of challenges from those of print ads — then that’s a big breakthrough for newspapers.

The Men Running America (In the Wrong Direction)

Two great moments in quotations today, both from men with the power to influence and shape America’s economic and political situation. The first comes courtesy of Aron Wilder, the CEO of HTFC, a small firm that takes loan applications and sells residential mortgages to larger lenders like GMAC. They’re one of many direct players involved in the subprime mess engulfing the economy. Here’s Mr. Wilder in response to a question from the lawyer representing GMAC, in GMAC’s lawsuit against HTFC for selling improperly underwritten loans [link]:

Q: This is your loan file. What do Mr. and Mrs. Fitzgerald do for a living?
A: I don’t know. Open it up and find it.
Q: Look at your loan file and tell me.
A: Open it up and find it. I’m not your fucking bitch.
Q: Take a look at your loan application.
A: Do it yourself. Do it yourself. You want to do this in front of a judge. Would you prefer to [do] this in front of a judge? Then, shut the fuck up.
Q: Sir, take a look—
A: I’m taking a break. Fuck him. You open up the document. You want me to look at something, you get the document out. Earn your fucking money, asshole. Better get used to it. You’ll retire when I’m done.

That’s usually not the sort of guy whose ilk you want as a huge force in your national economy.

Second, we have Vice President Dick Cheney, the No. 2 member of the United States executive branch. He is thus responsible for executing the will of the people, as written by the people’s representatives in the legislative branch. Here he is being interviewed by ABC News’ Martha Radditz about the Iraq war [link]:

Raddatz: Two-third of Americans say it’s not worth fighting.

Cheney: So?

Raddatz: So? You don’t care what the American people think?

Cheney: No. I think you cannot be blown off course by the fluctuations in the public opinion polls. There has, in fact, been fundamental change and transformation and improvement for the better. That’s a huge accomplishment.

That is an awful lot about the Vice President summed up in the one-syllable clause “So?” The man is concise!

Bear Sterns: A Lose-Lose for the U.S.

Bear Sterns, the biggest player in the subprime mortgage crisis, agreed today to sell itself to JPMorgan for an astounding $2 per share. The deal was set up by the Federal Reserve, which feared that Bear Sterns’ failing to find a buyer would have flooded the market with mortgage-backed securities and ruined more banks holding similar assets. In layman’s terms, it would have hella sucked, so they had to do some stuff to stop it.

Reading this article, there really is a lot to be said for having Bear Sterns die a mean death. It’s fitting as a consequence of their rough-and-tumble business dealings that went against everything my rural-Ohio landlord grandpa knew to be true about real estate: giving cheap money to people who can’t pay is generally a bad idea, and that’s extra true when it’s done on a nationwide scale.

The problem is that our national economy’s financing has become highly centralized, such that letting any one of the several big-time Wall Street banks — Citi, JPMorgan, HBS, Merrill Lynch and all those others where Northwestern MMSS kids go to become analysts — is a recipe for a major economic hurtin’ on people who don’t necessarily deserve it. We’d all love to see Bear Sterns’ disaster-makers get what they deserve, but the U.S. has given them such power in the first place that we can’t afford to let that happen.

That’s why I grudgingly support this bailout for the sake of those on the far end of Wall Street who would be hurt the most, with the caveat that the market needs greater regulation on the front end: the government can’t afford — literally — to keep waiting until things fail before it jumps in with lots of tax-provided cash to save the day. It’s odd that this happens in the same week that Eliot Spitzer, chaser of investor irregularity, took such a public dive. More action in the spirit of what he was trying to do could have prevented things like this, but if anything the momentum in that sphere has gone the other way in the wake of Spitzer’s hooker-induced political demise.

I just hope that Bear Sterns is a wakeup call to the public, but because it’s so complicated and industry-specific, I doubt that will happen. The funny thing is that it’s really not that complicated: people who think they know better probably don’t, and giving them too much leeway is asking for trouble.

Update 3/17: This Paul Krugman column says it better than I did.

Guinness’ St. Patrick’s Day Thing

I just saw one of the commercials in which Guinness promoted its effort to make St. Patrick’s Day an “official holiday” through the U.S. Congress. Leaving aside the fact that, pragmatically, March 18 should be the national holiday — people get hangovers, after all, and we get Jan. 1 instead of Dec. 31 off — I’ll give them credit for a clever idea-planting deal.

Clearly Guinness — and Diageo, its parent — know that this official-holiday thing, from a political perspective, really isn’t much. If Congress does recognize it, it would likely be just a symbolic recognition and not a federal holiday like Thanksgiving; if they don’t, well, whatever. The idea they’ve planted is to reinforce the predominant idea that St. Patrick’s is a time to take the entire day — particularly nice if it’s a day off anyway — and drink until you’re lying on the floor, which just might involve such Ireland-iconic (and delicious!) Diageo brands as Guinness, Harp or Smithwick’s. Either way, the drinking idea stays sticky in your brain-piece.

But back to the campaign, I would like to point out that St. Patrick’s Day is already a national holiday in — shocker — Ireland, where it is celebrated by taking the day off, going to Mass, and then hanging out at home. Parts of Ireland have imported the Americanized St. Patrick’s, but it’s by and large a day where people just rest up to honor my patron saint.

While I love a good party as much as the next guy, the wilding-out of St. Patrick’s is a trend I don’t much like — call it old-school, but St. Patrick’s Day to me is a day to watch bagpipers in parades and look back at just how far the Irish have come in the past 200+ years of America’s existence. Yes, pub-going is a big part of Ireland, but the whole get-blasted-in-green-hats thing is way more about consumerism than it is about any sort of ethnic pride. (Check out the number of Bud and Miller promos next time you’re out on St. Patrick’s.)

To acknowledge the counterargument, woo! Alcohol! But yeah, take it easy.

The Cacao Craze

Yesterday while housesitting for a friend, the wife and I finished off a hearty dinner. (For those both wondering and not wondering, I dropped culinary skillz to the tune of mussels in white-wine and garlic broth accompanied by a toasted baguette, fresh green beans in lemon-parsley butter and rosemary roasted potatoes. Fools better recognize.) While coming down from my mollusk-induced high, I opted for a piece of chocolate for dessert. I curiously noted the chocolate’s label: “65% Cacao”.

Trendspotting time, homes.

Chocolate companies are repping this cacao trend to the fullest. Take a look at some of the yuppie high-end chocolates next time you’re at the grocery store, and you’ll inevitably notice more percentage rates than a savings and loan.

For those who aren’t Pennsylvanian — read “awesome” — and haven’t done Hershey’s Chocolate World (be warned that the link features loud and annoying music), the cacao tree — native to Mesoamerica and an important part of the Columbian exchange — produces the beans that are processed into cocoa and, subsequently, chocolate. If chocolate is steel, cacao is the iron ore. (I guess that means adding milk is the Bessemer process and Switzerland is the Monongahela Valley.)

As a dude who likes to get his occasional chocolate on, I think I am qualified to state that good chocolate, like any good food, does happen solely by cramming your product with as much of one ingredient as you can. It is instead about balance: cacao is one part, but how well do you balance it with sugar, milk and other ingredients? That is key.

The cacao-percentage thing then is sly marketing: a way for one chocolate company to artificially quantify that its product is better than the competitor. I don’t know if this strategy is native to the U.S. chocolate market, but it does seem like a peculiarly American way to advertise food. Add in the oft-discussed health benefits of dark chocolate — easily confused with its tastier milk-enhanced variant, and who doesn’t like to exaggerate the healthiness of something that tastes great? — and you have the perfect status-symbol storm.

I think most of us are smart enough not to buy chocolate based on it having some higher numerical value, but I’m sure there are people who do so. To those people, I say, yo: buy the best-tasting kind, because higher cacao != consistently awesome.

This chocolate, on the other hand, always == awesome.

The OS X Candidate?

This Tuesday is not only Fat, but Super!

Geeta and I were discussing the election yesterday, and I noted how Barack Obama’s oft-cited appeal to young, creative types like us — that might be flattery, but hey, we are the target demo — makes me worry that the rest of the country might actually resent him for it. His flock might be seen as too cool and hip for the average folk, and they’d hold it against him. Then I read this, and it brought that thought home in a neat geeky analogy:

Obama’s a Mac, Clinton’s a PC

I’ve taken shots at Apple before for their cooler-than-thou branding, and their fan base in some ways parallels the nature of Obama’s. But I think it would be unfair to make this comparison based on Hillary and Obama themselves, since Obama is putting forth ideas and optimism without exclusion, and some of his supporters just happen to trend toward the young and fashionable. Apple’s anti-PC thing is a deliberate marketing strategy; Obama’s audience came together on its own, and while the young part of it gets a lot of press, he has supporters of all stripes.

It’s still an interesting comparison of the two Democratic camps. And like Microsoft, Hillary is doing pretty well in financial market share herself.

Pittsburgh Penguins: Worst Actors Ever

Thanks to Jerry for cluing me in to this awesome commercial. The first nine seconds are blank, but keep watching:

Why didn’t Malkin get an equally terrible/hilarious line?

Free!

The Atlantic Monthly just opened up its paid site to be free to web users. I was just saying the other day how I had heard this 2005 article about talk radio was an excellent portrait of the industry, and that I wished the site were open to non-subscribers so I could read it.

Obviously I’m now off to read it. Nice work, Atlantic Monthly.

Pat’s Going to Michigan

I got the good news on Friday: I’ll be heading this fall to the Ross School of Business at the University of Michigan to be part of the class of 2010.

I mentioned this fall that application essays were sapping my blogging resolve, so now yinz know what that was about. I’m definitely relieved to hear I was accepted, and more than that, I’m psyched to start grad school. I’m also hoping I don’t revert too much back to undergrad, but I don’t think business school students tend to beard-out quite as much as your average 20-year-old junior. (Note: that photo is of Microsoft’s staff in 1978, but it’s so awesome that I had to link it.)

“But Stack,” you may be saying, “where’d this MBA idea come from? I thought you were a web media guy.” You’re right: I am a web-media guy, and on first glance, it might be confusing. But the longer I’ve been doing what I do, the more I’ve realized an MBA is a solid idea.

I’m all about the success of online media: the format is still new, and media companies are finding their way through the changed climate, so it can be a scary thing for those steering the media to where it needs to be. Good websites are built on three legs — content, technology and business — and having worked a lot on the first two, I knew that strengthening the third one would help me out in the field. There’s a lot of harsh rhetoric on both sides about who’s going to “win” in the new / old media divide, but non-suckas know that it’s a mutually beneficial relationship up in this. Both old and new media need knowledgeable people to help guide the industry along and use the web’s opportunities. That’s where I’m coming from.

Journalists have long believed very strongly in the separation of business and editorial, and I share that opinion. But I think there’s a definite role for website managers who can navigate both sides of the field: an appreciation for the vital democratic role of the media with the ability to keep the site economically thriving is what’s needed here, and in a nutshell, I’m going to b-school to play that role.

And for the record, I’m agnostic on the football question right now. Sure, Michigan will help with future success, but I lived in Columbus from ages zero to one-month, my mom’s family is all over Central Ohio, and I can hardly turn my back on the greatest NU football moment of all time:

Conflicted.