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Eyes on Inflation, European Bank Raises Rate

Thursday, July 3rd, 2008
By MARK LANDLER
Published: July 4, 2008
FRANKFURT — The European Central Bank, spooked by soaring prices for food and fuel, raised interest rates on Thursday, joining several other central banks in battling a global eruption of inflation. With the quarter-point increase, the central bank followed those in Sweden and Norway that raised rates this week, citing inflation. The Federal Reserve in the United States, where short-term interest rates are only half of those in Europe, has so far declined to join them. The European Central Bank’s decision deepens a recent divergence in monetary policy on either side of the Atlantic, ending a long period when it tended to follow the course set by the Fed. But the sharp rise in inflation has put Europe’s bank into a policy bind because it has been accompanied, in recent days, by evidence that the economy here is deteriorating much like that of the United States. Manufacturing activity in the 15 countries that use the euro shrank in June for the first time in three years, according to a survey of European purchasing managers. In Spain and Ireland, where a collapse in housing prices has magnified the problems, there is a real risk of recession. Still, the European Central Bank, hewing to its inflation-fighting mandate, pressed on with the expected increase, lifting the benchmark rate to 4.25 percent from 4 percent. Among other thing, it is intended as a warning to unions not to use higher inflation as a lever to demand hefty pay raises. It was not clear, before an afternoon news conference chaired by the bank’s president, Jean-Claude Trichet, whether the increase would be a one-off gesture or the start of a cycle of tighter monetary policy. Several economists said they doubted the bank could tighten much further, given the parlous economic situation. “The E.C.B. is hiking at a time when confidence is plummeting,” said Thomas Mayer, the chief European economist of Deutsche Bank. “The question is, ‘what do you do when asset prices fall at the same time that consumer prices rise?’ The central bankers seem to have reached the end of the line.” Indeed, the bank has come under intense political pressure in recent days not to tighten credit at such a fragile moment for Europe’s economy. The French president, Nicolas Sarkozy, said higher rates would do little to stem the rising price of oil. Germany’s finance minister, Peer Steinbrück, warned that an increase could further depress growth. The central bank, under Mr. Trichet, has steadfastly rebuffed efforts to influence its policy. But even within its 21-member governing council, the unhealthy combination of inflation and stagnation has opened a split — with inflation hawks calling for a rate increase, while the doves resisted it. The hawks are led by Axel A. Weber, the president of Germany’s Bundesbank, which bequeathed its long tradition of inflation fighting to the European Central Bank. Germany is also an exception among major European countries, in that its economy is still expanding, even if more modestly lately. “It’s clear that Weber convinced Trichet and the majority of the council to go for it,” Mr. Mayer said. “But the weakening growth numbers will lead the others to resist further rate increases.” The position of the hawks was reinforced on Monday with new statistics that showed inflation in Europe rose to an annual rate of 4 percent in June, twice the ceiling set by the European Central Bank. With oil prices continuing to surge — it traded at a new record of$145 a barrel in Asia on Thursday — some economists expect inflation to spike even higher in August, perhaps to 4.25 percent. “There is a genuine question about what to do about inflation that is entirely driven by oil prices,” said Holger Schmieding, chief European economist at Bank of America in London. “One option is to let it filter through the system; the other option is to attack it now.” In raising rates, even at a time of such uncertainty, the European Central Bank has opted for the latter. Tags:

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Microsoft Seeks Path Beyond the Gates Legacy

Friday, June 27th, 2008
By STEVE LOHR
Published: June 27, 2008
Bill Gates is retiring, sort of. He is still only 52, and he is going off to spend more time guiding the world’s richest philanthropy, the Bill and Melinda Gates Foundation. He will still be Microsoft’s chairman and largest shareholder, but Friday is his last day as a full-time worker at the software giant, marking the unofficial end of his career as a business leader. And what a career it has been. Mr. Gates has been an animating force behind the personal computer revolution, helping to build a huge global industry and engineer blockbuster products like Windows and Office, used every day in offices and homes around the world. The Harvard dropout was the wealthiest person on the planet for years — worth more than $100 billion in 1999 — though his fortune is now about half that because of the decline of Microsoft’s shares and his continued donations to his foundation, which is focused on global health and education. Despite his success, Mr. Gates is moving on as the company he co-founded in 1975 is struggling to find its way. The center of gravity in technology has shifted from PCs to the Internet, altering the old rules of competition that were so lucratively mastered by Microsoft. For millions of users, mobile devices like cellphones are beginning to edge out PCs as the tool of choice for many computing tasks. And Google, the front-runner in the current wave of Internet computing, has wrested the mantle of high-tech leadership from Microsoft. Although Mr. Gates will spend one day a week at the company, it will be up to his successors, led by Steven A. Ballmer, the chief executive, to master the challenges of the Internet or watch Microsoft’s wealth and stature in the industry steadily erode. “Bill’s legacy is Windows and Office, and that will be a rich franchise for years to come, but it’s not the future,” said David B. Yoffie, a professor at the Harvard Business School. Still, the Gates legacy is impressive. In addition to the software itself, Mr. Gates and his company have fundamentally shaped how people think about competition in many industries where technology plays a central role. Today, there are more than one billion copies of the Windows operating system on PCs around the world. Industry experts and economists say that Windows is not necessarily the best or most admired software for running the basic operations of a personal computer — Apple’s Macintosh can claim the most devout fan club. But Mr. Gates grasped and deployed two related concepts on a scale no one ever had in the past: the power of network effects and the value of establishing a technology platform. Put simply, the network effect describes a phenomenon in which the value of a product goes up as more people use it. E-mail messaging and telephones are classic examples. A technology platform is a set of tools or services that others can use to build their own products or services. The more people who use the tools, the more popular the platform can become. Mr. Gates took advantage of both notions and combined them to build Microsoft’s dominance in PCs, spreading its influence with computer makers and software developers. Today, there are many thousands of software applications that run on the Windows platform, not just word processing and spreadsheets but also the specialized programs in doctors’ offices, factory floors and retail stores — a very broad network on a nearly ubiquitous technology platform. “Gates saw software as a separate market from hardware before anyone else, but his great insight was recognizing the power of the network effects surrounding the software,” said Michael A. Cusumano, a professor at the Massachusetts Institute of Technology’s Sloan School of Management. That, Professor Cusumano added, was the essential difference in the paths of Microsoft and Apple, the early leader in personal computing. Apple, he said, focused on making outstanding products alone, while Microsoft nurtured a growing ecosystem of outside software developers who use, and are dependent on, Microsoft’s technology. The result, he added, is that, while Apple continues to make outstanding products, more than 90 percent of personal computers run Microsoft software. In the early years, it was unclear how much Mr. Gates was pursuing each opportunity as it came, as opposed to carrying out a grand strategy. He certainly had large ambitions. When he was a Harvard undergraduate, Mr. Gates lamented that so many of his fellow students pursued a “narrow track for success” instead of being willing to “take big risks to do big things,” recalled Michael Katz, a Harvard contemporary who is now a professor at New York University. In a Harvard Business School case study, published in 1994, Mr. Gates spoke of Microsoft’s strategy in terms of network effects and technology standards that, combined, enabled the company to command markets. “We look for businesses where we can garner large market shares, not just 30 or 35 percent,” he said. In the past, Microsoft has beaten back challenges and vanquished rivals, even when it came late to markets, as it did in the first wave of Internet technology. Mr. Gates’s shrewd 1995 decision to embrace Internet browsing technology and attack the early leader, Netscape Communications, started a pitched antitrust battle with the government. “But he extended Microsoft’s hegemony for a decade,” said Mitchell Kapor, a longtime rival. However, Microsoft is lagging badly in current round of Internet competition and, analysts say, is facing more formidable challengers this time — notably Google. Microsoft’s share of Internet search in the United States is less than 10 percent, while Google holds more than 60 percent and Yahoo has about 20 percent. And search is only part of the new platform on the Web, which includes social networks like Facebook and MySpace and Internet-based alternatives to traditional desktop software, including e-mail messaging, word processors and spreadsheets. Traditional desktop software — and the technology standards Microsoft controls there — matter far less when more software is accessed with a Web browser and delivered over the Internet from vast data centers run by Google and others. The new approach is known as “cloud computing,” and the business model behind it is typically to sell online advertising and software services. At Microsoft, there is scant sign of panic, despite its trailing position and its failed bid to buy Yahoo for $47.5 billion as a catch-up strategy. Microsoft sees an evolution in computing, not a disruptive revolution that will imperil the company, said Craig Mundie, Microsoft’s chief research and strategy officer. Mr. Mundie said Microsoft is preparing for a widening world of both cloud computing and “client” machines, not only personal computers but also cellphones, cars, game consoles and televisions, all running Microsoft software. “The next big platform is the union of the clients and the cloud,” he said. Tags:

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High Fuel Costs Are Squeezing Low Air Fares

Friday, June 20th, 2008
For years, Southwest Airlines and JetBlue operated under self-imposed fare caps, promising travelers that no ticket would cost more than $299 one way. Those were the days. Want to fly from Boston to Long Beach, Calif.? On JetBlue, it will now cost as much as $599 each way. A one-way ticket on Southwest from Manchester, N.H., to Ontario, Calif., can be $414. The low-fare airlines aren’t so low anymore. Jet fuel costs — up more than 80 percent over last year — are forcing the airlines to sharply raise some fares, and reinvent themselves to appeal to not just bargain hunters, but also the briefcase crowd that generally pays more for last-minute tickets. No longer does Southwest’s slogan promise, “You are now free to move about the country.” “The reality is that fares must go up,” said Davis S. Ridley, Southwest’s senior vice president for marketing and revenue management. “The arithmetic doesn’t work if we transport five people across the country at $99 each way.” Airlines like Southwest, JetBlue and AirTran have been able to offer cheap fares for years because of their lower operating costs, for reasons that include simpler jet fleets, work rules and less-sprawling route networks. Their low prices and rapid growth forced the largest carriers to cut fares whenever they entered a market. They still offer deals for passengers who book trips well in advance, travel off-season and at less popular times. But in general, bargains are getting harder to find, as low-fare carriers join the bigger airlines in raising fares, which are up about 18 percent industrywide this year. About half a dozen smaller carriers, including Denver-based Frontier, have also gone out of business or entered bankruptcy this year, in part because of high fuel costs. Industry experts say the dividing line between the low-fare airlines and the largest carriers is blurring. “You don’t have the gigantic gulf of difference you had earlier this decade,” said Philip A. Baggaley, a senior credit analyst with Standard & Poor’s Rating Services. Southwest says it is trying to set itself apart on the issue of fees, if not fares. Major airlines are piling on new fees, like the $15 charge that American, United and US Airways charge some passengers to check a bag. Southwest still allows passengers to bring two free bags, and its marketing slogan is now “Freedom from fees.” Mr. Ridley, the Southwest executive, calls the fees other carriers are charging “airline heroin” because of the dangerous addiction they can become for raising revenue. The sales pitch resonates with some travelers. David Willenborg, a sales manager for a food manufacturer from Plano, Tex., said Thursday that Southwest’s lack of fees helps save his company money on top of the lower fares it offers for many routes that he flies regularly. He paid $415 round trip to Detroit this week, about 30 percent more than in the past, but he was able to check his suitcase and golf clubs free. On American, the round-trip fare would have been more than $1,000, he said, plus $40 for the bags. But Southwest is trying other means to generate extra revenue beyond raising fares. Despite its new slogan, it now offers a service that it calls Business Select. For a fee of $15, $20 or $25, depending on the length of flight and the fare, passengers get a cocktail, an extra credit on their frequent-flier program, and the right to board with the first group of passengers (Southwest does not offer assigned seats). Dave Anthes, an oil company salesman from Chesterfield, Mo., said he was willing to pay the extra money to ensure his choice of a seat on crowded flights. The priority boarding system, he said, is perfect for business travelers who do not have time to arrive early. “You used to have to get here two hours ahead of time and stand in line,” said Mr. Anthes, who was interviewed at the Detroit Metropolitan airport. JetBlue and AirTran, which joined the big airlines in adding a fee for a second bag, but not the first, say they are trying to strike a balance. “Low-fare carriers are not immune from oil prices,” said Robert L. Fornaro, AirTran’s chief executive. “We’ve had to recapture the price of oil. The question is, ‘How do you get there, fares or fees?’ We think it’s better to do both.” AirTran, which has offered business class on its planes since 1998, provides seat assignments on its top-priced fares at no charge, but charges $6 to select a seat for passengers flying on discounted coach tickets (it costs $20 to reserve an exit-row seat.) JetBlue has changed one of its original policies to be more attractive to business travelers. Before this year, it did not offer refunds to passengers whose plans changed. But in January, JetBlue introduced refundable fares, which the airline says generally cost $50 to $100 more each way than its nonrefundable tickets. Refundable tickets are marketed mostly to corporate customers. JetBlue recently joined four large reservation networks, a unique step for a low-fare airline. “Business customers like options,” said David Barger, JetBlue’s chief executive. “They’ll pay more for a premium seat in a coach cabin.” The option has been a boon to Skip Pleninger, vice president of Paris-Kirwan, an insurance company in Rochester. “I need to be able to switch my flights last-minute,” he said. For example, two of his meetings in New York City were canceled last week. Mr. Pleninger paid for that flexibility. If he books ahead, his fares generally are around $154; his fare for the trip this week was nearly $350. Mr. Barger said his airline was trying to maintain its thrifty image while coping with the “new normal” created by high fuel prices. “You can’t bust the brand. People still need to know they’re going to get value pricing,” he said. “But we’re asking the traveling public to participate by buying higher fares.”
Kathryn Carlson reported from Kennedy Airport in New York and Nick Bunkley from Detroit.

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Third-party ATM use to be free from April 2009

Tuesday, March 11th, 2008
Come April 2009, one will be able to withdraw money from the ATMs of any bank without shelling out any fee for the same, as per the new circular issued by the Reserve Bank of India (RBI) yesterday. From April this year to March next year, one will have to pay Rs20 for every transaction carried out using the ATMs of other banks, the RBI says in its draft circular published on its web site. No bank should increase the charges prevailing as on Dec. 23, 2007 i.e. the date when the RBI first came out with its approach paper on ATM. Banks which are charging more than Rs20 per transaction should reduce it to a maximum of Rs20 by March 31. The central bank says that the charge of Rs20 indicated will be all inclusive and no other charges will be levied under any other head. The RBI has also stipulated that banks should not charge any fee from customers using their own bank’s ATM. Also, all balance enquiry transactions through other banks’ ATMs should be available free. Banks can, however, levy charges for withdrawals using credit cards and from ATMs located overseas, the RBI says. India has 32,342 ATMs as of December 2007, according to the RBI. The central bank has rejected banks’ plea to cap the number of free cash withdrawals every month by saying that such a cap is not desirable and not practical. The RBI has also rejected the other suggestions made by the Indian Banks Association (IBA) and banks like permitting third-party advertisement on ATMs, white-label ATMs, cash withdrawal at the point of sale. While noting that the charges levied on the customers vary from bank to bank and according to the ATM network used for the transaction, the RBI says that a customer is not aware, before hand, of the charges that will be levied for a particular ATM transaction, while using an ATM of another bank. This generally discourages the customer from using the ATMs of other banks, the RBI says in the circular. It is, therefore, essential to ensure greater transparency, the central bank adds. The RBI also notes that in countries like the UK, Germany and France, customers have access to all ATMs free of charge except when cash is withdrawn for white label ATMs or from ATMs managed by non-bank entities. source: google news http://www.currentnewsaffairs.com http://blogs.mindbodynsoul.com Tags:

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RBI changes its mind, allows UBS India entry

Tuesday, February 19th, 2008
Less than a fortnight after the Reserve Bank of India said the grant of banking licence to UBS was on hold, the regulator on Monday said that a licence has been issued to the Swiss banking group. So what has changed? According to an RBI official, the Enforcement Directorate has cleared UBS’s name in a year-long investigation into alleged irregular foreign currency transactions. This is the first time since 2002-03 that RBI has issued a new licence to a foreign bank. The last foreign bank to enter India was Antwerp Diamond Bank and RBI is in the final stages of allowing the Singapore-based DBS to open more branches. Speaking to reporters after a conference in Mumbai, RBI deputy governor V Leeladhar said: “There were some transactions which needed to be clarified, which is why the UBS application had to be put on hold. But now those have been cleared and UBS has been permitted to go ahead with opening a branch.” UBS had earlier submitted a proposal to take over Standard Chartered Bank’s mutual fund (AMC) operations, which was rejected by the central bank. UBS had run foul of the regulator after it was said to have refused to offer the Enforcement Directorate money transfer details relating to Hassan Ali, a stud-farm owner who is under the ED scanner. The directorate subsequently advised the government not to clear the AMC deal. Stanchart is already looking for a new buyer for its AMC and is unlikely to revive talks with UBS.
UBS had applied for a banking licence nearly four years ago. The new licence would help UBS in its fixed-income and foreign exchange businesses, apart from forex derivatives products. UBS is present in India through UBS Securities, which was opened in 1990. It also has a merchant banking licence from stock market regulator Sebi. UBS’s Mumbai office offers advisory, equity sales and trading and employs nearly 80 people. The Swiss bank is also likely to kick off its private banking operations here, making India the fourth centre in Asia (after Singapore, Hong Kong and Tokyo) where it provides such services. Sources said UBS, which has total assets of CHF2.272 trillion, may also be looking at AMC operations in India. UBS runs an outsourcing unit - UBS India Service Centre - in India since June 2006. The division, which was kicked off with 500 employees, now has work force of 1,750 people and may grow further soon. The centre offers information technology, accounting and other back-office operations, including knowledge process outsourcing. On the Singapore-based DBS’s application for branch expansion, RBI’s Leeladhar said it was in the final stages of discussions. DBS, which has one branch each in Delhi and Mumbai, is the only Singapore-based bank currently operating in India. The bank will get new branches on the back of the Comprehensive Economic Co-operation Agreement signed between India and Singapore. The United Overseas Bank is the other Singapore entity that has applied for a branch licence in India. source: google news http://www.currentnewsaffirs.com http://blogs.mindbodynsoul.com   Tags:

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BILL GATE RECRUITS A CHAIRMAN-Humour

Saturday, October 20th, 2007
Bill Gates: Thank you for coming. Those who do not know JAVA may leave. 2000 people leave the room. Kantibhai says to himself, ‘I do not know JAVA but I have nothing to lose if I stay. I’ll give it a try’ Bill Gates: Candidates who never had experience of managing more than 100 people may leave. 2000 people leave the room. Kantibhai says to himself ‘ I never managed anybody by myself but I have nothing to lose if I stay.
What can happen to me?’ So he stays. Bill Gates: Candidates who do not have management diplomas may leave. 500 people leave the room. Kantibhai says to himself, ‘I left school at 15 but what have I got to lose?’ So he stays in the room. Lastly, Bill Gates asked the candidates who do not speak Serbo - Croat to leave. 498 people leave the room. Kantibhai says to himself, ‘ I do not speak one word of Serbo - Croat but what do I have to lose?’
So he stays and finds himself with one other candidate.
Everyone else has gone. Bill Gates joined them and said ‘Apparently you are the only two candidates who speak Serbo - Croat, so I’d now like to hear you have a conversation together in that language.’ Calmly, Kantibhai turns to the other candidate and says `kem chho’ The other candidate answers ‘ek dam majama’


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The Global Millionaire Boom

Friday, October 19th, 2007
Global Millionaire Boom
By Maya Roney  
Household wealth is hitting record heights, and not just in the U.S. There are more millionaire households on the planet than ever before, particularly in Europe and in China, where growth rates are highest.The total number of world millionaire households — those with assets of $1 million or more — grew by 14% in 2006, to 9.6 million, representing the richest 0.7% of all households and owning $33.2 trillion, or about a third of the world’s wealth, according to a recent study by the Boston Consulting Group, a global management consulting firm. “It’s sort of a sexy thing, looking at managing relationships on a household level,” says Bruce Holley, a New York-based partner with BCG, of the study. This is the first global wealth report from BCG that estimates the number of millionaire households per country, as well as estimating total wealth. “This year’s report, our seventh, examines the greatest source of organic growth within wealth management players: namely, their human assets,” write Holley and his colleagues in the report’s preface. China’s Rising — Fast The U.S. had, by far, the highest number of millionaire households, with nearly 4.6 million, and the highest number of $100 million-plus households, with 2,300. The number of millionaire households increased by a steady 10%, while $100-million-plus households grew by 7%, joining the ranks of Microsoft (NasdaqGS:MSFT - News) Chairman Bill Gates and Berkshire Hathaway (NYSE:BRK-A - News) Chief Executive Warren Buffett. Japan, Britain, Germany, and China round out the rest of the top five countries with the most millionaire households, in that order. The number of millionaire households increased the most last year in China (up 39%), Spain (up 32%), and Britain (up 30.5%). In Europe, the number of millionaire households grew by 26.4% in 2006, the highest of any region in the study, helped by its strong currency against the weakening U.S. dollar. In North America, millionaire households grew by just 9% in 2006. The United Arab Emirates and Switzerland led the ranking for highest density of millionaire households, with millionaire households accounting for 6.1% of all households in each country — almost nine times the global average. Japan, Britain, Germany, and Italy have the most households in the $100 million-plus bracket, and in terms of growth, China (up 74%), Brazil (up 27%), and Russia (up 26%) saw the highest rates last year. “China is a force to be reckoned with,” says Holley, noting that the country’s total assets under management have grown at an annualized rate of 23% over the past five years. China’s newest billionaire residents will find themselves in the company of powerful businessmen like Suntech Power’s (NYSE:STP - News) Shi Zhengrong, who lives in the city of Wuxi. “Globalization of Inequality” But some see a darker side to all this new wealth. “What these number disguise is the globalization of inequality everywhere in the world,” says Charles Derber, professor of sociology at Boston College and author of Corporation Nation. “This is the phenomenon of the rich getting richer. And it’s not a phenomenon to be happy about — that’s my reaction.” According to new Internal Revenue Service data announced last week, income inequality in the U.S. is at its worst since the 1920s (before the Great Depression). The top percentile of wealthy Americans earned 21.2% of all income in 2005, up from 19% in 2004, while the bottom 50% of wage earners earned 12.8% that year, down from 13.4% a year earlier. As of 2006, the U.S. held about 40% of the world’s wealth and 50% of its millionaire households, according to the Boston Consulting Group. Now in China and India (which ranks 15th in BCG’s list of countries with $100 million-plus households but, interestingly, does not appear in the top 15 nations for millionaire households), it’s clear a substantial upper class is emerging. But rural poverty numbers are also on the rise, according to Derber. Whether you’re for it or not, “this is the name of the game in any part of the world,” he says. “It’s the Gilding Age of the globe.” Check out the slide show to see the 15 countries with the most millionaire households.  
Source : Yahoo - Business Week
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Microsoft buys online ad company

Friday, May 18th, 2007
SAN FRANCISCO: Microsoft said Friday that it would buy the online advertising company aQuantive for about $6 billion, the latest in a flurry of deals for online advertising firms by big Internet and media companies. The all-cash deal is Microsoft’s largest acquisition ever and comes with an unusually large premium, underscoring just how critical Microsoft believes the acquisition is to its troubled efforts to become a major force in the fast-growing Internet advertising business. The price, $66.50 a share, is 85 percent more than aQuantive’s closing stock prince of $35.87 Thursday. “It puts us in the game, if you like,” said Chris Dobson, head of global advertising sales at Microsoft. “If you ever had any doubt that Microsoft was going to be big in the online advertising space, this should make it clear that it will.” The deal comes on the heels of Google’s recent agreement to buy DoubleClick for $3.1 billion, as well as the acquisitions of RightMedia by Yahoo and 24/7 RealMedia by the advertising company WPP Group. Microsoft, which had tried unsuccessfully to buy DoubleClick, faced competition for aQuantive, but was determined not to be outbid this time, executives said in a conference call. Based in Seattle, aQuantive has several major businesses. Its Atlas unit competes with DoubleClick and is used by advertisers and publishers to deliver ads online when users visit a Web page. The company also owns AvenueA/Razorfish, a leading interactive ad agency, and other digital businesses. Microsoft has struggled to compete in the online advertising market, particularly against Google, which dominates the field. Until now, Microsoft has sold ads on its MSN portal and used a technology called AdCenter to sell ads linked to Internet searches, a booming business, and the cornerstone of Google’s power. But Microsoft’s share of the search business has steadily declined, limiting the effectiveness of AdCenter. With aQuantive, Microsoft will be able to help sell and broker ads on sites across the Web, a business that is seen as increasingly important as advertising continues to shift online. The acquisitions of DoubleClick and RightMedia by Google and Yahoo were also intended to bolster those companies’ efforts to sell and broker ads on myriad Web sites. Microsoft has asked regulators to scrutinize the Google-DoubleClick deal, which it said would reduce competition. But Brad Smith, Microsoft’s senior vice president and general counsel, contended that Microsoft’s acquisition of aQuantive would promote competition. Forecasters at ZenithOptimedia, a media buying agency, predict that Internet ad spending will total $31 billion globally this year, a 28 percent increase from last year. In terms of market share, the Internet has already passed outdoor advertising, and will pass radio next year, Zenith Optimedia says. “We’re going to see people taking tens of millions of dollars out of television advertising and putting it into online, and that’s what all these guys are betting on,” said Shar VanBoskirk, an analyst at Forrester Research. The boom in Internet advertising is also reshaping the advertising pipeline, with online media owners like Google, Yahoo and Microsoft’s MSN increasingly moving into areas that used to be dominated by advertising companies like Omnicom Group, WPP and Publicis Groupe. In the offline world, there has generally been a clear distinction between media outlets and advertising agencies, which create the ads and buy time or space to run them. On the Internet, that line has been blurred, with portals like Google increasingly pushing into “upstream” areas like media planning and buying. “We’ve suddenly got two different sides that are competing in the same area, in the advertising companies and the media owners,” VanBoskirk said. There are signs of friction as online media owners like Google, with their deep pockets, expand. Google’s agreement to buy DoubleClick was criticized by Sir Martin Sorrell, chief executive of WPP Group who said it could trouble marketers. “It raises issues about whether we are prepared to give Google data that’s very valuable,” he said last month as WPP gave a quarterly financial update. “Clients will be concerned over the access Google may have to information that is owned by them.” While companies like 24/7 and DoubleClick focus primarily on distributing Internet advertising to online media owners, aQuantive gives Microsoft some broader capabilities. In addition to the Atlas ad serving platform, it also creates ads and plans media strategy, among other things, moving Microsoft into areas in which Google has not yet staked out a claim. “Today’s announcement represents the next step in the evolution of our ad network from our initial investment in MSN, to the broader Microsoft network including Xbox Live, Windows Live and Office Live, and now to the full capacity of the Internet,” Microsoft’s chief executive, Steven Ballmer, said in a statement. source : google news http://blogs.mindbodynsoul.com http://www.mindbodynsoul.com Tags:

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TIGER ROARS

Tuesday, May 1st, 2007
Anil Ambani CHAIRMAN  Reliance Communications Ltd., India’s second-largest mobile services firm on way to be Global number one , said on Monday quarterly profit more than doubled, beating forecasts, on higher usage in the world’s fastest-growing mobile market. Reliance Com , which gets more than 65 percent of its revenue from wireless subscribers, said it plans to spend over 100 billion rupees ($2.4 billion) in the current fiscal year that began on April 1 to expand its telecoms infrastructure. The firm, which had more than 28 million users at end-March, said net profit for the quarter grew 154 percent to 10.24 billion rupees, beating a Reuters survey of nine brokerages which forecast on average 9.02 billion. The company said it would take a decision in the next six months on “unlocking value” in its Reliance Telecom Infrastructure unit, and a potential listing of undersea cable unit Flag Telecom. “We have a number of options in front of us. Listing is one of those options,” Chairman Anil Ambani told reporters at a news conference. Strategic partnerships or private equity investment in these two units were also being considered, Ambani said. He added the firm would aim to sustain its expansion in operating margins, which grew to 40 percent in 2006/07 from 24 percent a year earlier. “We have seen margin expansion across the board … Our objective is for sustainability.” Revenue for the quarter rose almost 33 percent to 39.37 billion rupees, but fell short of market estimates of 40.86 billion. Larger rival Bharti Airtel Ltd. last week reported its quarterly profit almost doubled to 13.53 billion rupees. Ambani said the company would also decide in the next two months on outsourcing its network and information technology services to enhance the quality of service. “We are at a negotiating stage with all the global dealers,” he said, adding that the deal value would be “hundreds of millions of dollars.” India has 12 telecoms firms which offer fixed-line and mobile services on GSM and CDMA platforms. In February, Vodafone bought a controlling stake in unlisted Hutchison Essar, India’s fourth-largest cellular operator. “I don’t see Hutch going away and Vodafone coming in its shoes should not really make a very big impact on the telecoms sector,” Ambani said, when asked about how the company would tackle competition from Vodafone. Shares in Reliance Communications rose 3.7 percent to 477.10 rupees in a Mumbai market that closed 0.26 percent down. The shares fell 10.9 percent in the January-March quarter, pressured in part by a failed bid for Huchison Essar, compared with a 5.2 percent drop in the benchmark index. Source Reuters Universal News Suggestions Tiger WE love you and ask of you tokeep roaring loudly for BHARAT Prince Mohan http;//currentnewsaffairs.com   Tags:

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Peter Drucker

Tuesday, April 24th, 2007
Business , that’s easily defined - It’s other Peoples’ money . Peter Drucker Management Guru http://news.hinduworldtoday.com Tags:

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