business news in context, analysis with attitude

Published on: January 10, 2019

This commentary is available as both text and video; enjoy both or either ... they are similar, but not exactly the same. To see past FaceTime commentaries, go to the MNB Channel on YouTube.

Hi, Kevin Coupe here and this is FaceTime with the Content Guy … and in fact, this week, you’ll actually have to watch the video if you are interested in my FaceTime commentary.

That’s because it consists of a series of clips compiled as I wandered this year’s version of the Consumer Electronics Show (CES) in Las Vegas - my first time attending CES.

It is, as I note in the video, exactly as overwhelming as I expected it to be. This seemed to be a transitional year for CES, without a blockbuster announcement of some new technology or killer app that seems destined to change all of our lives; in fact, this seems to be a transitional year for technology in general, with even Apple struggling a bit to find its footing in the marketplace at a time when there seems to be no next big thing to unveil.

Sure, there was plenty of VR. And AI. And 5G. And self-care-oriented products (including one massager, the Osé, that used microrobotics so impressively that it got an innovation award from CES that was then stripped away when it was determined that the item was less about self care and more about being an instrument of pleasure, though that strikes me as a distinction without a difference, or maybe a difference without a distinction). And a huge number of voice activated gizmos. And even a 96-inch 8K television that was amazing … though in addition to be wildly expensive, one has to remember that it is likely to be years before 8K content is available, so owning one would be like having an Aston Martin DB5 sitting in your driveway and absolutely no access to fuel.

Rather than make advance choices about what booths to visit in advance, I decided to simply wander and see what grabbed my attention. There were a couple of surprises. And even, in the end, some lessons and organizing principles that occurred to me.

Keep in mind, this is designed to be both random and thoughtful, but neither comprehensive or encyclopedic. Just one Content Guy’s impressions and musings …

Here’s the good news, though. Next week, we’ll be following up by posting a new Retail Tomorrow podcast that I hosted, in which some terrific guests and I drill down not just on lessons from CES, but about the nature of innovation and technology and their role in the current and future retail continuum. I found it illuminating, and I think you will, too.

Published on: January 10, 2019

by Kevin Coupe

Twenty years ago tonight, HBO premiered the first episode of “The Sopranos,” which is generally assessed as being not just one of the greatest TV series ever made, but also the series that essentially ushered in our modern era of exceptional and often unconventional television programming.

Some of how television has changed can be ascribed to technology - after all, when “The Sopranos” began, there were no streaming services, no such thing as binge-watching; you had to wait until Sunday night for a new episode, and then you talked about the travails of this upwardly mobile and stressed-out mob family with your friends and family the next morning.

But even more important, “The Sopranos” was an extraordinary piece of art and an example of how popular culture can transcend the mundane and become ambitious, complex, thoughtful and groundbreaking. (And even maddening, as debate about the final moments of “The Sopranos” final episode persists, even all these years later.)

There is a line from “The Sopranos,” written by its creator, David Chase, and uttered by Tony Soprano (the incomparable James Gandolfini, who died in 2013), that strikes me as worth mentioning here, because it sums up the kind of forward-thinking attitude that business leaders need to bring to their work.

“‘Remember when,’” he said to some of his mob buddies, “is the lowest form of conversation.”

And that’s my Eye-Opener. Bada Bing, Bada Boom.

Published on: January 10, 2019

The New York Times is reporting that the current partial government shutdown “has stopped routine food safety inspections of seafood, fruits, vegetables and many other foods at high risk of contamination.” The halt in inspections was announced via social media by Dr. Scott Gottlieb, Commissioner of the US Food and Drug Administration (FDA).

“In a series of tweets,” the Times writes, “Dr. Gottlieb said he was taking steps to restore food safety surveillance inspections and to cover more of the high-risk sites as the shutdown continued. He said he hoped to bring back about 150 inspectors who had been furloughed during the shutdown, perhaps as early as next week.” However, Gottlieb was not sure how he could achieve this goal under current conditions.

The partial government shutdown occurred when the White House and Congress were unable to come to an agreement on a Continuing Resolution that would keep the government funded and operating. The Trump administration has demanded that any such funding include more than $5 billion to build a wall or some sort of physical barrier across the nation’s southern border with Mexico, a demand that has been rejected by the now Democrat-controlled House of Representatives.

The Times writes that “F.D.A. inspectors normally examine operations at about 160 domestic manufacturing and food processing plants each week. Nearly one-third of them are considered to be at high risk of causing food-borne illnesses … Domestic meat and poultry are still being inspected by staff at the Agriculture Department, but they are going without pay. The F.D.A. oversees about 80 percent of the nation’s food supply, as well as most overseas imports.”

The US Centers for Disease Control and Prevention (CDC) says that food-borne illnesses send some 128,000 people to the hospital and kill 3,000 people each year.

The story also notes that user fees imposed on various industries are still able to cover some of the agency’s costs, and that FDA inspectors have been given “access to a central expense account so they could continue traveling while avoiding large personal credit card bills without knowing when the government would reimburse them.”

Still, public health experts remain concerned about the impact of the shutdown on food safety and the general population, especially if it continues without political resolution.

Published on: January 10, 2019

Call it a sign of the times - a shopping mall being converted into offices for a technology company.

The Los Angeles Times reports that Google has decided to lease almost all of the Westside Pavilion, “once one of the city’s premier shopping venues and a cultural touchstone for generations of Angelenos, appearing in movies, television shows and music videos.”

Google, the story says, “will lease nearly all of the mall, which fell on hard times and is being made over, as it further expands its presence in Los Angeles. The company will occupy 584,000 square feet of the prominent Pico Boulevard center, which owner Hudson Pacific Properties Inc. announced it is renovating into a stylish office complex with street-to-rooftop windows.

“The property has been renamed One Westside as part of its radical renovation, which has been budgeted for as much as $360 million before Google starts adding its own improvements … Planned improvements by architecture firm Gensler announced Tuesday include exterior terraces and patios with 15-foot-wide folding glass walls intended to create an indoor-outdoor environment for Google’s workers. It will have a rooftop garden deck and a bridge to the mall’s surviving movie theater.

“The 12-screen Landmark Theatres complex will remain in the reconfigured complex, as will the Westside Tavern restaurant and other shops mostly on the ground floor along Pico and Westwood boulevards.

“The outdoor parking lot on the south side of One Westside will be converted to landscaped park-like space where Google employees can work or relax outside of the office.”

It is not the first iconic piece of property that Google has taken over in the area - last year, in Playa Vista, Google transformed an airplane hangar built by Howard Hughes for the Spruce Goose “into a high-tech outpost to serve its ambitions to become a leading producer of Hollywood content on its YouTube platform.”

Published on: January 10, 2019

Fox News reports that at the urging of its local employees - some 3,700 of them signed a petition - “several Starbucks locations in the Seattle area will be installing safe needle deposit boxes in store bathrooms.”

The reason? Baristas at some stores say “they have to dispose of hypodermic needles left behind by drug users every day,” and when they are put in the garbage, tampon disposal boxes, and diaper changing stations, they risk being stabbed while cleaning up.

“Exposure to HIV/AIDS, Hep C, Hep B, etc. is a risk in Seattle where there is a heroin/hep c crisis,” the petition claimed, arguing that employees then “have to pay out-of-pocket for [treatment if poked] before being reimbursed until Starbucks's company insurance kicks in.”

Fox News notes that since the matter was brought to management’s attention, “Starbucks has been looking into the matter and are actively looking into solutions such as installing sharp boxes and testing heavier duty garbage bags to prevent needles from poking through.”

Published on: January 10, 2019

USA Today reports that while health-conscious consumers currently have access to “a full menu of support and strategy options” to help them lose weight - including “apps like DietBet.com and MyFitnessPal, celebs to emulate on Twitter, detox teas and other products peddled on Instagram and Facebook, YouTube fitness moguls with how-to videos, and the camaraderie in closed WhatsApp groups” - for many, traditional and well-known programs still carry significant appeal.

“The main players – WW International (formerly Weight Watchers International), Nutrisystem, Jenny Craig and Medifast – grew 18.1 percent to $3.11 billion in 2018, according to an initial analysis by Marketdata, a Tampa, Florida-based market research firm that tracks the diet market. This year, they're likely to grow 8 percent to 12 percent.”

The story suggests that in part this is because these brands have strong and time-tested images. But it also points out that to varying degrees, they’ve all adjusted to the new world in which they find themselves competing with this trend or that app - they’re using technology to a greater degree than ever, they’ve collaborated with celebrities who have credibility in the space, and they’ve found ways to partner with or be acquired by companies that give them the financial means to innovate.

“Shifting with the trends is what enables these legacy brands, more associated with your mom's – or grandma’s – dieting years ago than hipsters lifestyle choices, to ride the weight-loss-to-wellness trajectory,” USA Today writes. “Then, they loop back to word-of-mouth – whether on social media or in person – to keep business booming.”

Published on: January 10, 2019

Amazon founder-CEO Jeff Bezos, the world’s richest man, and his wife of 25 years, MacKenzie Bezos, announced yesterday on Twitter that they are divorcing.

“After a long period of loving exploration and trial separation, we have decided to divorce and continue our shared lives as friends,” they said, adding that they “see wonderful futures ahead, as parents, friends, partners in ventures and projects, and as individuals pursuing ventures and adventures … Though the labels might be different, we remain a family, and we remain cherished friends.”

Bloomberg writes that “while Wall Street took the announcement in stride, investors will be watching to see if the divorce settlement affects Bezos’s control of Amazon. So long as the company is growing and returning profits, he’ll probably maintain their confidence, though a settlement could potentially put a dent in such Bezos side projects as the space exploration company Blue Origin.”

Washington is a community property state, which means that unless there is a pre-nup, post-nup or some other negotiated agreement, MacKenzie Bezos is going to be entitled to half of everything Jeff Bezos has.

“Bezos, 54, is worth $137 billion, according to the Bloomberg Billionaires Index, a ranking of the world’s 500 wealthiest people,” Bloomberg writes. “He owns about 16 percent of the retailer as well as the Washington Post and Blue Origin … A divorce could reshape the global wealth ranking. If the couple split their fortune equally, it could leave MacKenzie, 48, with $69 billion, making her the world’s richest woman.”

However, most of Bezos’ wealth is said to be in Amazon stock, which makes the divorce - and whatever settlement the two people come to - of considerable interest from a business point of view.

Published on: January 10, 2019

…with brief, occasional, italicized and sometimes gratuitous commentary…

• Amazon is now shipping the new Echo Auto. Finally. And selectively.

TechCrunch reports that Amazon announced the Echo Auto - a portable device designed to bring the Alexa system into a user’s automobile - last September, but until recently only has been accepting requests from shoppers to be invited to buy one. A few people were able to order theirs in time for Christmas, but Amazon has only now begun shipping the item t=o some of the more than a million people who asked to be invited to buy it. And, for the moment, the Echo Auto is still invitation-only on Amazon’s site.

Count me among the people waiting to be invited to buy one. This is one of those items that I’m totally into … after all, we have Alexa is virtually every room of the house, and there are plenty of times when I’m in the car that I’d like to be able to ask it something. In fact, I may order two - it’d be nice to be able to throw one into my carry-on and bring it with me on trips.

Published on: January 10, 2019

…with brief, occasional, italicized and sometimes gratuitous commentary…

• The New York Times reports that a new study published in The BMJ and The Journal of Public Health Policy says that “Coca-Cola and other Western food and beverage giants … have helped shape decades of Chinese science and public policy on obesity and diet-related illnesses like Type 2 diabetes and hypertension.”

These companies, operating through a group called the International Life Sciences Institute (ILSI), “cultivated key Chinese officials in an effort to stave off the growing movement for food regulation and soda taxes that has been sweeping the west.”

An example: “Happy 10 Minutes, a Chinese government campaign that encouraged schoolchildren to exercise for 10 minutes a day, would seem a laudable step toward improving public health in a nation struggling with alarming rates of childhood obesity. But the initiative and other official Chinese efforts that emphasized exercise as the best way to lose weight were notable for what they didn’t mention: the importance of cutting back on the calorie-laden junk foods and sugary beverages that have become ubiquitous in the world’s second largest economy.”

It isn’t just in China - ILSI “has 17 branches,” the story says, “most of them in emerging economies like Mexico, India, South Africa and Brazil, and promotes itself as a bridge between scientists, government officials and multinational food companies.” ILSI also maintains, the Times writes, that it is “committed to backing ‘evidence-based food and nutrition research’ and that it did not conduct lobbying activities or make policy recommendations in the countries where it operates.”

Coca-Cola tells the Times that that it has been “changing the way it funded scientific research through greater transparency and by ending its practice of providing the lion’s share of money for studies. In recent years, it added, Coca-Cola has sought to address mounting obesity in China by offering an array of new sugar-free beverages and through improved nutrition labeling on products. ‘We recognize that too much sugar isn’t good for anyone,’ it said.”

First of all, good for Coke … where they seem to realize that this stuff can come back and bite them in the rear end of their vending machines. As for ILSI … Gee, isn’t it somehow reassuring to know that it isn’t just US government officials who can be influenced by lobbying dollars to look past science and common sense. It is everybody else, too. We are the world, baby.


• The Cincinnati Business Courier reports that Kroger Co. will raise $1.2 billion in debt later this month with much of it planned to pay off existing debt.” Kroger, the story says, “plans to issue two series of notes, according to a new Securities and Exchange filing. It will issue $600 million in 10-year notes due in January 2029 and $600 million in 30-year notes due in January 2049. Both series are to be issued Jan. 14.”

The story notes that “Kroger said the debt it will pay down includes long-term debt that comes due this month … Kroger has invested more than $1 billion in the past year and a half in increasing its online sales and home delivery capabilities.”

Published on: January 10, 2019

• The National Grocers Association (NGA) today announced that Robert Yeakel has joined its government relations department as a director, managing payments and data security policy issues. Yeakel most recently worked as a policy advisor for the U.S. House of Representatives Committee on the Budget, where he managed and advised members of Congress on a wide portfolio of issues that included telecommunications, cybersecurity, and financial services.

Published on: January 10, 2019

• Carlos Sánchez, who came to renown by playing Juan Valdez, a fictional Columbian coffee grower who served as a pitchman for almost 40 years, promoting Colombia’s National Federation of Coffee Growers, has died. He was 83.

In its obit, the New York Times writes that Sánchez “was Colombian and grew coffee as a youth before turning to painting and acting. As Valdez, an indefatigable farmer with a warm expression, a lush mustache and a mule named Conchita, he became an avatar for the farmers who harvested Colombia’s coffee beans and a positive depiction of a country that was often equated with terrorism and drug trafficking.”

Published on: January 10, 2019

…will return.