economics
Because That Will Really Take Away Starbucks Marketshare, Alright
From the article:
Ronald McDonald is taking off the gloves and brewing the good grind in hopes of supplanting Starbucks as the wireless hangout of choice.
McDonald's promised last week to outfit 14,000 of its locations with upscale coffee bars accompanied by expanded Wi-Fi service as the fast-food chain inches closer to offering the wireless technology free of charge. Currently, McDonald's provides Wi-Fi service to 15,000 of its 30,000 U.S. and international locations. The service is available most often through a credit card purchase or through Internet service provider Wayport.
To help McDonald's goals, Sony Electronics announced Sunday that its Mylo COM-2 communicator users will receive free Wi-Fi service at more than 9,000 McDonald's locations. Wayport, which supplies Wi-Fi service to McDonald's restaurants, said Mylo users will be able to easily log on to the service and won't need even to enter a user name or password.
The announcement comes in the wake of McDonald's October decision to offer free Wi-Fi service at 1,200 locations in the United Kingdom. By expanding Wi-Fi service, combined with its plans to build upscale coffee bars with baristas, McDonald's is moving toward direct competition with Starbucks, which has slightly more than 13,000 U.S. locations.
Those 12 Mylo owners will really hurt the latte sales @ Starbucks, that's for sure. Starbucks is an image thing as well as a halfway-decent-coffee thing. People - for better or worse - equate Starbucks with style! and McDonalds with "cheap". 802.11 and commodity espresso will not help the golden arches steal the cool from the king of lattes.
Having said that, the continuing economic crunch may drive folks to try a McCarmelMachiatto or AmeriMcano, but will it be good enough to capture customers?
If anyone has tried the McDonalds espresso drinks and can compare them against those from Starbucks, drop a note in the comments. I'd be interested to hear if it's worth giving it a shot (heh).
- 717 reads
Big Oil Needs A Nikon
Steven Mufson has a great piece in the Washington Post on the current state of the oil industry and the BBC has another interesting tidbit on China's Godzilla-like PetroChina (it's now worth $1 trillion USD).
Much like John Gruber's argument that Apple Needs A Nikon, I purport that big oil needs one as well – meaning they need real alternative energy competition. Traders seem to be behind this pricing bubble that – despite fudged economic statistics – is causing real economic damage across much of the world. They justify it by saying the speculation is based on real fears, but there is a great deal of evidence that it's all about having a playground for vast sums of currency.
Oil is a dirty, greedy, corrupt, environmentally damaging business that makes a small number of rich people and companies even richer at the expense of everyone else. Oil workers in Saudi and Nigeria are practically slaves and see little of the profits their masters accumulate. To ensure the product flows freely, we have to employ our military vessels (and this has nothing to do with the Iraq situation...it predates it by a wide margin) and the product itself seems to make rulers into madmen (Venezuela, anyone)?
The US is not without it's own madmen...Exxon and other companies continue to make a ludicrous amount of money, but complain when their profit margins are squeezed, even though they justified the huge gains by "times will be tough at some point". It's all about money, and there's only one game in town when it comes to fueling the engines of society.
The world needs an energy alternative –preferably more than one, to avoid another monopoly situation – and it needs it now. The problem is that if we do manage to find one (and I firmly believe we have a few in holding), it will plunge many of these third world countries (and I include Saudi, Iraq, Iran, China, Nigeria, etc in that description) into utter chaos and destabilize many, many regions. We (the US) are responsible for letting it get this far (we have a history of greedy white males doing stupid things for profit) and we have to be willing to take the chance of some temporary global destabilization to break the globe free of our dependence on this slippery black beast.
- 649 reads
Auto Union Workers Walk Out at Chrysler - New York Times
While I doubt Cerberus will stand it's ground, I sincerely hope it does, especially since Chrysler doesn't have to worry about stock performance anymore and can hold the union's feet to the fire. The bottom line is that – like it or not – corporations that expect to survive in the 21st century need to have the flexibility to source from wherever they can. Jobs are going to be lost regardless. It's a matter of how many and whether the US has any part in the modern, global manufacturing economy. If the unions are willing to take pay cuts to bring their salaries closer in line with other markets, then that may be what they have to do in order to keep these type of jobs in America. Either that or finally start building incredible cars that everyone loves with zero defects.
Auto Union Workers Walk Out at Chrysler - New York Times: "In particular, Chrysler was reluctant to make a commitment to the number of new products would be built in American plants, and to guarantee how many jobs would remain at the company, which is in the midst of a restructuring program. Chrysler officials are said to be seeking flexibility to import vehicles from outside the United States, so they can take advantage of cheaper labor costs."
- 332 reads
How Many Failed Bush Energy Policies Does This Make?
[REF: Ethanol's Boom Stalling as Glut Depresses Price]
But companies and farm cooperatives have built so many distilleries so quickly that the ethanol market is suddenly plagued by a glut, in part because the means to distribute it have not kept pace. The average national ethanol price on the spot market has plunged 30 percent since May, with the decline escalating sharply in the last few weeks.
“The end of the ethanol boom is possibly in sight and may already be here,” said Neil E. Harl, an economics professor emeritus at Iowa State University who lectures on ethanol and is a consultant for producers. “This is a dangerous time for people who are making investments.”
While generous government support is expected to keep the output of ethanol fuel growing, the poorly planned overexpansion of the industry raises questions about its ability to fulfill the hopes of President Bush and other policy makers to serve as a serious antidote to the nation’s heavy reliance on foreign oil.
This is a article of gratitude:
Thank You! President Bush for one of the worst energy policies in the history of America and trying to take the easy way out of a complex situation.
Thank You! Farmers of America who traded good farming practices for dollar signs, knowing we'd be there to bail you out.
Thank You! Farmers for contributing to wheat and other crop shortages because you thought we could all live on corn and ethanol.
Thank You! Farmers & Bush for executing so well on your ill-conceived plan that you drove prices up for so many other products that a large number of folks in America cannot afford them anymore (luxuries like beef, milk, ...)
Thank You! President Bush for actually solidifying our reliance on foreign oil rather than incenting real innovation in the energy and transportation industries.
Thank You! Congress for rubber-stamping the subsidies for our sheep-like, gold-rush farmers instead of challenging the status quo and actually *doing* something.
And, finally,
Thank You! America for electing and keeping these folks in power. You may have received what you deserved, but the rest of us are impacted as well.
- 384 reads
FP Provides Some Cred to My "Milk" Argument
Foreign Policy magazine has a blog (obvious if you've ever looked to the right block column at all) and one of their recent entries lends some credence to my milk post earlier in May.
All but the very rich are going to feel the food cost crunch and it's going to hurt. I suspect this is one reason we now have Diet Coke Plus, so the kiddies (and adults) can get their vitamins in a non-dairy, cheap beverage.
As the FP post suggests, why can't I have some of my tax dollars back so I can afford the outrageous food prices. Why am I subsidizing farmers who clearly are gouging consumers?
While it may still wind up costing more in the end, you can help stick it to these multinational, multi-billion dollar farming outfits if you:
- buy local
- buy organic
- grow your own (if you can), and
- consume less
Writing your state and federal representatives would be a prudent item to add to your to-do list as well.
- 498 reads
First Oil; Then Corn; Now: Milk
It was bad enough that Big Oil has been fixing oil & gas prices. Then the U.S. Federal Government had to prop up farming by falsely promoting corn-based fuel, thus raising prices on corn and corn products. Now, it's milk.
It will take a well-crafted argument with verifiable data to convince me that this looming "dairy crisis" was not cooked-up deliberately by farmers. They knew there was going to be demand. They also know that base economic supply/demand principles work. One could argue against a global dairy conspiracy, but with the demise of the small, family farm it's easier to understand. Big Oil has a new companion in the club: Big Farming.
Beef costs more. Seafood prices are up[pdf]. The continuing switch to organics is costing us more; Now, we can add milk to the list.
As with oil/gas, we all can't just go out, grab a couple cows and start producing our own milk and meat. We are at the mercy of large, multi-national corporations who seem to be doing their best to ensure that a small number of folks get very wealthy while everyone else gets poorer. (And this is coming from a conservative who believe in capitalism!)
We need more Big Media stories on this to wake up the global community. Unfortunately, Big Media is pretty much just another multi-national, keenly aware that it needs to keep its friends happy to rake in the profits.
- 710 reads



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