Archive for March 20th, 2008

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While it’s still the undisputed king of the on the internet auction business, eBay (NASDAQ: EBAY) has its share of image and customer service problems. Soaring fees are irritating sellers, and BloggingStocks’ Gary Sattler has chronicled eBay’s struggles obsessively. Rampant counterfeiting and allegations of widespread fencing are also hurting the site’s reputation.

After watching the video below, I think I may have the solution to eBay’s problems: Judge Judy.

Kelli Filkins appeared on Judge Judy to defend plaintiffs’ claim that she had defrauded them on eBay by sending them a picture of a phone they paid $240 for. She claimed that the ad stated it was for a picture only.

What ensued is possibly the greatest smackdown in the history of Judge Judy — who told Ms. Filkins that she’s an “outrageous person.” The sharp-tongued judge went on to say: “If you live to 120, you’re not gonna be as smart as I’m in one finger. You may weigh more, but you’re not gonna be smarter than I’m in one figure.” Burn sauce!

Given Judy’s reputation as a no-nonsense judge who will crack down on shenanigans, eBay could work out a licensing deal to brand its complaint resolution system as “Judge Judy” — and run an ad campaign where she talks about her commitment to making eBay a safe place for buyers and sellers. Eh? Eh?

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Reuters reported yesterday that privately held EMI Group plans to join Vivendi’s Universal Music Group and offer songs in Nokia (NYSE: NOK) mobile devices as part of the new “Comes with Music” program. The report comes out of Nokia’s home country, Finland, but since Universal’s commitment bridges international divisions, it is likely the EMI connection will as well.

The “Comes with Music” program was first announced in December 2007, with Universal fully on board to offer unlimited access to millions of Digital Rights Management-free tracks for a year, and any tracks on the phones at the end of the year becoming the consumers’. Clearly, the program has a major upside in that the end of a subscription does not mean music tracks are going to disappear, something that always seems to be at the fore of subscription-based music plans. The tracks will also be available on those consumers’ personal.

As nice as the plan is, the labels won’t lose too much from allowing a subscription plan like that to take off. Nokia and label executives are banking on the size of catalogs to combat fears that it will hurt the music industry financially. In the press release for “Comes with Music”, Nokia’s Executive Vice President for Multimedia stated, “even if you listened to music 24 hours a day, seven days a week, you would still only scratch the surface of the music that we’re making available.”

With two major labels on board, the “Comes with Music” program is sure to be on the right track to succeed when it is launched later this year. The only worry that likely remains is whether any other digital store will initiate a better or similar plan to increase sales.

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This post is one of several on business heirs apparent. Let us know in the comments whether you think James Murdoch should take up the reigns of News Corp., and be sure to check out the other heir apparent posts.

James Murdoch seems the opposite of his father, media mogul Rupert Murdoch.

The younger Murdoch is described in media reports as a low-key family man who isn’t much of a schmoozer. Rupert Murdoch adores to court politicians, something that doesn’t seem to interest James. The fourth Murdoch child, though, did sow his wild oats when he was younger, dropping out of Harvard and founding a hip-hop music label that was later acquired by News Corp. (NYSE: NWS).

But James Murdoch got rid of the eyebrow stud and got serious about business. Sure, Rupert Murdoch’s many detractors screamed “nepotism” when the old man named him to run the News Corp’s British Sky Broadcasting business. Eventually, though, James Murdoch won them over by doing a bang-up job.

“He won over his critics in the city by hitting ambitious targets, increasing the number of Sky subscribers by more than one million, but he also eschewed his father’s abrasive approach, saying early on that the company would be ‘a partner not a pariah’ to its rivals,” according to The U.K,’s Observer newspaper.

Last year, Rupert Murdoch promoted his son to the job of chief executive for Asia and Europe, suggesting as the AP noted, that he’s being groomed for the top job. But will Rupert Murdoch ever be able to let go of the reins of power? Sumner Redstone has sure found it difficult.

There’s no way that News Corp. would have ever done a $5 billion dilutive deal for Dow Jones & Co. based on a cool reading of the balance sheet. As I’ve argued before, Rupert Murdoch is almost as interested in gaining influence as making money. If shareholders happen to benefit, that’s great. If they don’t too bad.

Maybe a James Murdoch-led company would be more disciplined. That would be great for shareholders but lousy for journalists who obsessively follow Rupert Murdoch’s every move.

Freelance writer Jonathan Berr edits the blog Ketchup and Eggs.

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Starbucks Corporation (NASDAQ: SBUX) is struggling and with Howard Schultz back in as CEO, the company is looking to get its sales moving upward again. One possible strategy? Free coffees, discounts with a rewards card, and a possible expansion of the company’s $1 coffee campaign — with free refills.

Will these plans help boost sales in the midst of a struggling economy? Probably. But, if I were a Starbucks shareholder, I’d be concerned about the damage to the brand. The fact is that Starbucks has become one of the best companies in the world — that’s not an exaggeration — with an emphasis on quality and customer experience that made it, for a long time, essentially immune to the competitive pressures that other companies deal with.

If Starbucks has to resort to value-oriented marketing like each other company does, then Starbucks is no longer as special as it was in its heyday as a great growth stock.

That stated, the stock is down more than half from the 52-week high it reached in 2006, and the company’s woes may already be priced in — leaving the company’s strong brand undervalued.

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This post is one of several on business heirs apparent. Let us know in the comments whether you think Galen or Alannah Weston should take up the reigns of Weston, and be sure to check out the other heir apparent posts.

W. Galen Weston was once an heir apparent himself, taking the bakery founded by his grandfather George Weston in 1882 and expanding it into one of the largest food conglomerates in North America, George Weston Ltd. (TSX: WN), which includes such brands as President’s Choice, Entenmann’s, Brownberry, Thomas’, Boboli, Ovaltine, and Twinings. A fixture on the Forbes billionaire list, Galen Weston also holds a controlling stake in the Loblaws supermarket chain, and took the Selfridges department store private a few years ago. His heirs apparent are his kids, son Galen G. and daughter Alannah.

Galen G. Weston was installed as executive chairman of Loblaw Companies (TSX: L) in 2006, and faces something of a challenge if he’s to prove his mettle. Since his arrival, the company has experienced its first annual loss in decades, share prices have slumped to a ten-year low, and opening superstores to fend off competition from the likes of Wal-Mart Canada hasn’t worked out so well. The company is now focusing on its supply chain and supporting infrastructure, as well as limiting the types of merchandise the stores sell. Such efforts have helped the company swing back into the black.

Alannah Weston got her start working in the Weston-owned Holt Renfrow department store. After Selfridges went private in 2003, Alannah became Creative Director, charged with revitalizing the well-know U.K. stores. Her responsibilities include analyzing and updating the architecture and design of London’s Oxford Street flagship store, and she personally handles the store’s window displays. Like her partner, CEO Paul Kelly, she believes in a hands-on approach to management.

At 67, W. Galen Weston remains chairman of both Loblaw and Selfridges. The question is, do Galen G. or Alannah have what it takes to assume the reins of the empire when the time comes? Time will tell.

In the meanwhile, here’s a peek of Galen G. Weston in action:

Also be sure to check out the other heir apparent posts.

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