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    Published on: October 4, 2013

    by Kevin Coupe

    Here on MNB, we've made a lot of the ownership transition at the Washington Post, with Amazon founder Jeff Bezos buying the venerable newspaper for $250 million and promising to bring the paper into the digital 21st century.

    Well, that's not the only paper where the technology world is having an impact.

    The Phoenix Business Journal reports that the Arizona Republic has informed a number of reporters that they will be given laptops and are expected to become "mobile reporters," working without a traditional office and filing stories from places like Starbucks and McDonald's that offer free wi-fi.

    According to the story, "Some reporters said they could work from home, but others said they were being asked not to work from home and instead be out in the field as much as possible. Reporters are being asked to take home their files, and keep them in their car or at home. The move is expected to save money and be the next step in the Republic’s digital coverage, sources say." While the paper actually is moving to new offices, the story says that reporters will not be given desks, and will be expected only to come in for the occasional meeting.

    I find this fascinating and not necessarily encouraging - one of the things that I remember most fondly from my days as a newspaper reporter was the interplay and interaction among reporters ... that was how you learned and grew and gained wisdom and intelligence. (Think of the newsroom scenes from All The President's Men, which are painstakingly realistic.)

    This is hardly the end of journalism as we know it. But it is yet another symbol of how traditional businesses are changing to cope with how the world is evolving.

    It can happen to anyone.

    And it is an Eye-Opener.
    KC's View:

    Published on: October 4, 2013

    The Cincinnati Enquirer reports that Harris Teeter shareholders yesterday approved the $2.5 billion acquisition of the company by Kroger, a deal that is expected to be finalized by the end of the year if regulatory approvals come through.

    (No government objections are expected, but because of the shutdown, nobody at the Federal Trade Commission is talking. Or even, apparently, answering the phone.)

    Both companies have said that they think the deal will be a positive one across the board - that Kroger will bring operating efficiencies to Harris Teeter, and Harris Teeter will bring customer service and fresh foods expertise to Kroger.
    KC's View:

    Published on: October 4, 2013

    The French government appears to be on the verge of passing legislation that would require online booksellers - such as Amazon.com - to sell at prices higher than those charged by bricks-and-mortar stores, by "banning any seller from applying government-regulated discounts to the cover prices of books that are shipped to readers," the Wall Street Journal writes.

    The bill has been passed by the lower house of Parliament and "now heads to France's senate with the backing of both major parties, was explicitly aimed, lawmakers said, at Amazon, which frequently discounts books and ships them free of charge to French buyers—a deal independent booksellers say amounts to unfair competition."

    In an emailed response to the legislation, Amazon said that "any measure aimed at raising the price of books sold online would hurt French people's ability to buy works of culture, and would discriminate against online consumers."

    There is a broader issue at stake - concerns that companies like Amazon have structures that allow them to avoid paying corporate taxes. France reportedly plans to push for new EU rules that would make it far more difficult to avoid such taxes.
    KC's View:
    I'm sure that the next thing they'll be doing in France is passing legislation that requires the smoking of smelly cigarettes and the wearing of berets. The next thing you know they'll be putting Charles de Gaulle on the ballot.

    Because the general tenor of this legislation seems to be to avoid coming face to face with the competitive pressures of the 21st century.

    I think the tax issue is one thing. But deliberately putting online retailers at a disadvantage because they've developed a business model that may be more effective than traditional varieties.

    Published on: October 4, 2013

    • Jennifer Hatcher, Food Marketing Institute (FMI) senior vice president of government and public affairs, issued the following statement in order to clarify hunger program funding during the government shutdown:

    “Misinformation continues to circulate regarding the October 1 government closure’s impact on federally-funded hunger programs, which has in turn created customer concern and thus operational challenges for the food retail industry.
    “While we certainly want the shutdown to end quickly, funding for the Supplemental Nutrition Assistance Program (SNAP) extends through October, so SNAP customer benefits will be available.  Food retailers always experience heavy volume at the first of the month when benefits are loaded onto EBT cards, so our message to SNAP customers is that they can utilize their benefits throughout the month, and there is no need to redeem all of their benefits now.

    “In contrast to SNAP, which functions as a mandatory program, the Women Infants and Children (WIC) program, which supports nutritionally at-risk moms and children, relies on annual federal appropriations. FMI and our members and state associations have been in contact with each of the state WIC agencies. Many states still have leftover FY2013 funds available for WIC benefits or have repurposed funds that were intended for other areas or for contingencies. USDA sent additional funds yesterday to those states that were facing immediate WIC funding challenges. At this time, every state is accepting WIC vouchers in order to keep feeding those vulnerable moms and children, and again, there is no need for moms to rush to a store to try to redeem all of their allotments on their WIC checks. 


    • United Supermarkets announced this week that it is extending its Military Discount Wednesdays program to seven-days-a-week until further notice as a result of the federal government’s shutdown and the subsequent closure of military base commissaries.

    According to the announcement, United is offering "a 10 percent discount on grocery purchases for all active, retired and civilian military at all eight United Supermarkets and Market Street locations in Abilene, Burkburnett and Wichita Falls," communities located near active U.S. Air Force bases (Dyess AFB near Abilene and Sheppard AFB near Burkburnett and Wichita Falls). The discount is applicable to all grocery purchases – excluding fuel, gift cards or pharmacy purchases – with valid military ID."


    Politico reports that "federal meat safety inspectors might still have their jobs on Day Two of the government shutdown — keeping steaks, hamburgers, turkey and chicken safe for human consumption — but what about the rest of the food on our plates?

    "The U.S. Food and Drug Administration, responsible for 80 percent of the food supply, is halting routine food inspections. This means no government oversight of practically everything else in the grocery store. Also, most of the experts at the Centers for Disease Control and Prevention, the group that identifies and tracks foodborne illnesses, have been told to stay home ... According to the plan released by the administration, FDA will be 'unable to support the majority of its food safety, nutrition, and cosmetics activities.' That includes routine food manufacturer inspections, compliance and enforcement of food safety regulations and food import monitoring."
    KC's View:

    Published on: October 4, 2013

    The Wall Street Journal reports that Amazon plans to unveil "a video-streaming device in time for the holiday selling season, according to people briefed on the company's plans. The set-top box, which would pit the online retailer against a host of established rivals, is a small device that resembles a Roku Inc. player and is similarly styled as a platform to run apps and content from a variety of sources, these people said."

    The story says that the device will also serve as yet another way to deliver Amazon's existing content,and is seen as a way for the company to bolster its Prime membership list, making it the preferred way of accessing content (as opposed to, say Netflix or iTunes).

    Amazon hasn't actually confirmed the strategy, a release date or pricing for the device, but the story notes that CEO Jeff Bezos "likes to sell devices, such as its Kindle Fire tablets, at close to the cost of manufacturing and profit from the sale of services available through the hardware."
    KC's View:
    It is Amazon's master strategy, to control of not just the purchasing of content, but also its delivery and consumption. And it is an approach that more retailers ought to think about, in terms of locking customers into their "system" through a variety of tactics.

    Published on: October 4, 2013

    • FreshDirect, the NYC-based pure play online grocer, is teaming up with crowdfunding site RocketHub "to find the newest, coolest food-related innovation," according to a story on Entrepreneur.com.

    The story says that the companies are "seeking the latest and greatest food products, kitchen gadgets, farming advancements or any other innovation that involves what you eat and how you eat it. Applicants have until the end of the month to submit their ideas online. Finalists will be announced in November and will then have to crowdfund their businesses on RocketHub.com. The winner will be chosen based on the amount of money raised, the quality of the idea and engagement with the crowd."


    • The National Retail Federation (NRF) said yesterday that it "expects sales in the months of November and December to increase 3.9 percent to $602.1 billion, over 2012’s actual 3.5 percent holiday season sales growth. The forecast is higher than the 10-year average holiday sales growth of 3.3 percent."

    However, while there is optimism about the holiday shopping season, the forecast also is "somewhat hinging on Congress and the Administration’s actions over the next 45 days; without action, we face the potential of losing the faith Americans have in their leaders, and the pursuant decrease in consumer confidence."
    KC's View:

    Published on: October 4, 2013

    Internet Retailer reports that daly deal site Groupon has made a series of hires designed to help it diversify bits business.

    Robbie Schwietzer, formerly vice president of Amazon Prime and a 10-year veteran of the e-commerce giant, has been hired as senior vice president of operations.

    Lisa Kennedy has been hired as a vice president and general manager of its Groupon Reserve service; she is the founder of Hopscotch, an India-based daily deal site, and former executive vice president of e-commerce for Quidsi Inc., an Amazon subsidiary that operates Diapers.com, Soap.com and BeautyBar.com.

    David Kerr has been hired as a vice president and general manager of home services, charged with creating "a marketplace on Groupon.com where consumers can find, schedule and purchase deals from local service providers."

    And, Groupon hired Hoke Horne, former vice president of software finance at Juniper Networks, to be its vice president of global commercial finance.


    • McDonald's announced that Atif Rafiq, a former executive at Amazon and Yahoo!, is joining the fast feeder in the newly-created global role of Chief Digital Officer, charged with leading "McDonald's global digital strategy focusing on future growth in e-commerce, modernizing the restaurant experience, and engaging with consumers across the digital landscape."
    KC's View:
    These hiring moves speak volumes about how these very different companies are working to position themselves in the current competitive environment.

    Published on: October 4, 2013

    ...will return.
    KC's View:

    Published on: October 4, 2013

    • The best-of-five National League Divisional Series have begun...

    The Los Angeles Dodgers defeated the Atlanta Braves 6-1, to take a 1-0 series lead.

    And, the St. Louis Cardinals defeated the Pittsburgh Pirates 9-1, to also take a 1-0 series lead.



    • In Thursday Night Football action, the Cleveland Browns defeated the Buffalo Bills 37-24.
    KC's View:

    Published on: October 4, 2013

    As you're reading this, I'm almost certainly under anesthesia.

    Nothing to worry about. It's just that it was time to have a colonoscopy, and so yesterday I went through all the prep ... which sort of made writing MNB a bit of a challenge. (Hard to get any writing momentum going. Though there was plenty of other momentum, if you know what I mean...)



    As I said recently, one of the nice things about iTunes is that a number of the networks make pilot episodes available for free. That means that I've been able, while on airplanes and such, to watch a few of them to see if there's anything worth following.

    The answer, I'm afraid, is no.

    The quality has varied. A couple of the shows - "The Goldbergs" and "Back In The Game" - are execrable. They are badly written, badly acted, badly conceived and not worth 22 seconds of your time, much less 22 minutes.

    I felt a little bit differently about "The Crazy Ones" (the new Robin Williams sitcom), "The Michael J. Fox" Show," and "Trophy Wife." They aren't bad ... the acting is good, and they show glimmers of creativity, but I couldn't help thinking that they didn't exactly represent highest common denominator thinking. I feel a little guilty about criticizing "The Michael J. Fox Show," considering the backstory - the lead character, like the actor who plays him, is grappling with having a normal life after being diagnosed with Parkinson's disease. But it could be a lot better. As could much of television.

    One new show I like very much is "The Blacklist," which has a Silence of the Lambs vibe , with James Spader as a master criminal who volunteers to help the FBI track down criminals, but will only talk to a young, female agent with whom he appears to have no connection. Spader is a hoot, the stories so far are strong, and I want to see what happens next.
    Same goes for "Homeland," which is back on Showtime for its third season ... a show that I find utterly compelling, even when it gets implausible. A lot of that can be attributed to wonderful performances by Clare Danes, Mandy Patinkin and Damien Lewis. Plus, it trades on the national paranoia that is so prevalent these days.

    And finally ... I am so happy that "The Voice" is back. I hate myself for being addicted to it, but there is a general cheeriness about this talent show that is contagious. I root for the singers, I love the judges, and I enjoy pretty much every moment, because it is about celebrating talent, not mocking it. Which is a business lesson, I think.




    There is wonderful movie out that you absolutely need to see - Enough Said, a lovely romantic comedy written and directed by Nicole Holofcener, and starring Julia Louis-Dreyfus and James Gandolfini in one of his last performances before his untimely death earlier this year.

    Enough Said is about the nascent romance between two divorced, middle aged people - a TV show librarian (such things exist in Los Angeles) played by Gandolfini, and a masseuse, played by Louis-Dreyfus. Things get complicated when one of Louis-Dreyfus's clients begins complaining bitterly about her ex-husband ... who, of course, ends up being Gandolfini. Now, this may sound like a sitcom, but it is played for subtle laughs and recognizable drama, with characters who seem utterly real and situations that seem utterly plausible.

    Go see it. You'll be glad you did.




    Two wines to recommend this week...both whites that are excellent with grilled or spicy seafood. I heartily recommend the 2011 Tin Barn High Vista Vineyard Sauvignon Blanc, and the 2012 Longboard Sauvignon Blanc. Enjoy.



    That's it for this week. Have a great weekend, and I'll see you Monday.

    Slàinte!
    KC's View: