From the decline of America’s most famous tabloids to the uproar over the giant Pacific octopus, The Daily Beast brings you the best in business journalism from the week of October 19, 2013.
Post Mortem: A (Somewhat Premature) Newspaper AutopsySteve Fishman – New YorkWith its eye-catching front pages, racy coverage, and general attitude, theNew York Post has come to symbolize New York City and the tabloid world it engenders. Now with the News Corp. decision to spin off papers on their own, some see the end nearing for the money-losing daily.The Octopus That Almost Ate SeattleMarnie Hanel – New York Times MagazineSometimes our conscience and stomach don’t see eye to eye.
Is a $13 billion fine to settle mortgage misconduct by two of the bank’s 2008 acquisitions really persecution? JPMorgan was happy to make the deal at the time—and now must face the consequences, says Daniel Gross.
Over the weekend, it was reported that JPMorgan Chase had agreed to a $13 billion settlement over the sale of mortgage-backed securities during the credit boom. The tentative deal would settle charges that the bank, along with institutions it ultimately acquired in 2008—Bear Stearns and Washington Mutual—misrepresented the quality of loans that had been packaged into mortgage-backed securities.This deal would be the biggest in a long series of settlements in recent years that have spurred the bank to push more and more cash into legal reserves.
Everybody expects their colleagues to be constantly connected. Beth Comstock, who runs marketing for one of the world’s biggest corporations—General Electric—says unplugging is vital to managing effectively.
By now, it’s common for executives to feel overconnected. If the sun never sets on your business empire, it’s unlikely that your smartphone ever goes dark. Being constantly available projects an image of productivity to colleagues—who doesn’t feel gratified when a late night email is returned within minutes? But, over time, it reduces our communications to their most basic and transactional. As most of us already know intuitively, it also kills our creativity.
In the wake of the shutdown deal, Congress has an opportunity to gets its house in order. Dave Cote, chairman and CEO of the Fortune 100 company Honeywell, on what’s at stake.
We need to fix our nation’s balance sheet for the coming decades of increasing global competition. According to USDA economic statistics, over the next 20 years U.S. share of world GDP will shrink from 26 percent to 22 percent. Other developed regions will decline from 40 percent to 29 percent. And developing countries will grow from 34 percent to 49 percent. In 20 years developing countries will represent half of world GDP. Countries like China are becoming a global competitive force—and we will need a strong balance sheet to compete.
It’s not going gangbusters, but the Connecticut system hasn’t broken down yet amid headlines blasting the HealthCare.gov glitches nationwide, the state exchange’s CEO tells Daniel Gross.
At the national level, the rollout of Obamacare has gone poorly. The big federal health-care exchange, HealthCare.gov, is a poorly designed, badly functioning mess.But many states have embraced Obamacare as their own and have been working diligently on indigenous systems to enroll people through homegrown exchanges, either by enrolling them in Medicaid or helping them set up accounts to purchase health insurance. Kentucky has been an early, noteworthy, success.
Soon after Healthcare.gov launched, users started reporting major problems. As blame flies around, there's one party that seems to have emerged unscathed—the company that built the faulty site.
A funny thing happens to the shares of large, largely anonymous federal contractors when they become implicated in a debacle: they rise. We saw this at work earlier this year with Booz Allen Hamilton. The firm, which gets virtually all of its revenue from the federal government, employed Edward Snowden, who proceeded to use the access afforded him by his post to grab and make public all sorts of embarrassing secret government information. But Booz Allen didn’t lose any contracts as a result or suffer much opprobrium in the public markets.
The Iranian-American founder of eBay plans to sink millions into a new investigative media project with journalist Glenn Greenwald. Friends and employees tell Lloyd Grove his big move into media is driven by his passion for American democracy.
More than anything else, eBay founder Pierre Morad Omidyar—who is ready to plow as much as $250 million of his nearly $9 billion fortune into an as-yet-undefined journalism venture—has impressed colleagues and acquaintances with his refreshingly modest personal style.“He’s a very normal person,” says New York University journalism professor Jay Rosen, who interviewed the press-shy Iranian-American about his plans to join forces with lawyer-turned-investigative reporter Glenn Greenwald, the impresario of the Edward Snowden revelations in Britain’s The Guardian, to create a major media enterprise from the ground up.
Raises questions about strategy.
Price matters, but not in the way Apple thought it would. Due to weak consumer demand, Apple has reportedly cut orders for its cheaper iPhone 5C model. Last month Apple introduced the 5C along with the high-end 5S, which saw high demand particularly for its gold-colored model. Apple’s move to introduce a competitively priced phone was seen as a response to Samsung’s recent strength in the smartphone market. The lack of interest in a cheaper iPhone could mean that part of the allure of Apple is that its products are seen as luxuries.
In insider trading case.
This will give him something to talk about. Notoriously outspoken billionaire owner of the Dallas Mavericks Mark Cuban was found not guilty on Wednesday of insider trading. He had been accused by the SEC of illegally selling 600,000 shares of Mamma.com after receiving information from the owner of the website. The high-profile trial was part of a recent spate of public crackdowns by the SEC as it tried to salvage its reputation post-financial crisis.
Despite the buzz, hot tech companies are posting disappointing earnings. A difficult and constantly shifting online advertising market is to blame.
Whether its jokes about Ted Cruz’s ‘TEDtalk’ lighting up Twitter, or the shutdown drama driving eyeballs to political newssites, Washington events have been a boon to internet traffic. But cash doesn’t always follow the eyeballs. And disclosures this week of less-than-glorious financial results at Yahoo! and Twitter show that the ad business that’s supposed to fund our digital media obsession may not be quite so robust.Yahoo! reported that traffic was up to its sites in the third quarter, thanks to revamped sites, the launch of new products, and the acquisition of Tumblr.
With an Ohio Walmart hosting a holiday food drive for its own workers, The Daily Beast's Michael Tomasky criticizes the notoriously stingy company for not paying them more.
After nearly a decade of being confined to a dark garage with pets by her cult-worshipping foster parents, a young girl is set free.