FP Posted

Graphic: How demand for rail has increased since 2000

Drew Hasselback — Fri, 06 Nov 2009 20:00:00 GMT

Here's some data that might help understand why Warren Buffett is keen to invest billions to acquire full ownership of the Burlington Northern Santa Fe railroad. The graphic below shows how much the demand for various modes of freight transportation changed in the U.S. from 2000 to 2007.

Financial Post and Bloomberg News

FP Tech Desk - Morning Buzz (Men don't read gadget directions, Apple and Sarah Jessica Parker sued, Christopher Walken sings Lady GaGa)

Matt Hartley — Fri, 06 Nov 2009 16:22:00 GMT

Happy Friday. Here's some of what's making news around the tech-no-sphere in the run up to the weekend.

Apple Inc. and Sarah Jessica Parker are co-defendents in a new lawsuit brought forth by a Florida man who claims the Sex and the City star and Apple CEO Steve Jobs stole his ideas, including the trademarks for "iPod" and and iTunes. [via Apple Insider]

Directions? Who needs those? According to a new UK study, 64% of men (compared to 24% of women) didn't read the directions for how to operate a gadget before calling a technology help line. Oh, and 12% of men simply needed to plug the device in or turn it on. *facepalm* [via BBC]

Record label EMI has successfully sued an U.S. company that was selling Beatles tunes online which it claimed it had "re-recorded." Needless to say, a judge saw right through that argument. [via TechDirt]

A new study from the PEW Internet and American Life Project finds that technology is not making social isolation worse and that although our social circles are getting smaller -- regardless of the size of your Facebook friend list -- social networks, mobile phones and the Internet aren't causing us to become disconnected from our neighbourhoods the way you might think. New York Times article.

Just because we're big fans of Christopher Walken here at the FP Tech Desk, here's your Friday Funny YouTube video of the star of The Prophecy and Joe Dirt reading the lyrics to Lady GaGa's "Poker Face." It's just about as awesome as you'd expect.

FP Tech Desk: How much does the iPhone really cost in Canada? A (somewhat) comprehensive comparison of the carriers' plans

Matt Hartley — Fri, 06 Nov 2009 14:52:00 GMT

Photo: iPhone! iPhone! iPhone!! (Justin Sullivan/Getty Images)

Matt Hartley, Financial Post

It's open season for iPhones in Canada.

For the first time, all three of Canada's wireless carriers are offering Apple Inc.'s touch screen iPhone. Although Rogers was the first to offer the device (as far back as the summer of 2008) both Bell and Telus jumped into the fray this week with the launch of their own HSPA mobile networks.

Of course, now that Canadians have their choice of carrier, the question becomes: which one offers the most iPhone for your money?

Here at the FP Tech Desk, we know it can be tough to sort through the fine print and endless strings of numbers contained in carrier rate plans. So we've tried to simplify the process for you as best we can.

Below, you will find a (somewhat) comprehensive comparison of the various iPhone-specific rate plans offered by Bell, Rogers and Telus. We compare the price of the devices, the plans offered and some of the additional features and costs specific to each carrier.

As well, we have built what we believe to be three somewhat typical profiles of iPhone users to give you an idea of what you might want out of an iPhone plan depending on how you expect to use it.

(Please note that all these plans were calculated according to Toronto-area usage rates and may not be universal across the country)

**********

UP FRONT

Okay, let's start with the cost of the device itself. All three carriers offer the 16 gigabyte (GB) and 32 GB iPhone 3Gs (in both black and white) as well as an 8 GB version of the older iPhone 3G. Rogers, however is the only carrier currently offering the older 16 GB iPhone 3G.

Prices for the devices themselves are fairly even, unless you're looking to pick up an iPhone without a contract, in which case, Rogers offers a slight discount over Bell and Telus on all available models.

iPhone 3G (8GB)
Bell: $99.95 on a three year contract, $599.95 without a contract
Rogers: $99 on a three year contract, $580 without a contract
Telus: $99 on a three year contract, $599 without a contract

iPhone 3G (16GB)
Rogers: $149 on a three year contract, $730 without a contract

iPhone 3Gs (16GB)
Bell: $199.95 with a three year contract, $699.95 without a contract
Rogers: $199 with a three year contract, $680 without a contract
Telus: $199 with a three year contract, $699 without a contract

iPhone 3Gs (32GB)
Bell: $299.95 with a three year contract, $799.95 without a contract
Rogers: $299 with a three year contract, $780 without a contract
Telus: $299 with a three year contract, $799 without a contract

**********

MONTH TO MONTH

All three carriers have designed smart phone pricing plans which combine phone minutes with text messaging and data services, allowing users to take advantage of the Web-browsing capabilities of these increasingly sophisticated devices.

While Bell and Rogers have both created iPhone-specific plans, Telus has opted to create a set of plans which apply to all of its smart phones, including BlackBerry devices, not just the iPhone. Below are the stripped down pricing plans for each of the three carriers.

Bell:
Bell offers four iPhone-specific plans, each with different combinations of data and local phone minutes. Bell users can choose any of the company's phone plans for use with the iPhone -- and still qualify for the discounted iPhone price-- however, company officials say the iPhone plans have been designed specifically to take advantage of the device's features.

Combo 45 plan ($45)
150 minutes of local talk time
Unlimited talking and texting with 5 local numbers
500 MB of data
Unlimited local calling after 9 p.m. and on weekends
Also includes: Conference calling, call waiting, unlimited WiFi access at Starbucks locations.

Combo 55 plan ($55)
300 minutes of local talk time
Unlimited talking and texting with 5 local numbers
1 GB of data
Unlimited local calling after 9 p.m. and on weekends
Also includes: Conference calling, call waiting, unlimited WiFi access at Starbucks locations.

Combo 75 plan ($75)
400 minutes of local talk time
Unlimited talking and texting with any 5 numbers in Canada
2 GB of data
Unlimited local calling after 9 p.m. and on weekends
Also includes: Call display, message centre, conference calling, call waiting, unlimited WiFi access at Starbucks locations.

Combo 95 plan ($95)
500 minutes of local talk time
Unlimited talking and texting with any 5 numbers in Canada
Unlimited incoming and outgoing text messaging throughout Canada
2 GB of data
Unlimited local calling after 9 p.m. and on weekends
Also includes: Call display, message centre, conference calling, call waiting, unlimited WiFi access at Starbucks locations.

Fine print
- Bell charges $35 for each new customer activation and also tacks on a $6.95 per month system access fee.
- With the iPhone-specific plans, users cannot add additional data packages, however they can get more minutes per month if they find they're talking too much and going over their limit. Additional minutes are $0.35 each.
- If users spend too much time surfing the Web and go over their alloted data plan, each additional MB is $0.03.
- Only the $95 plan includes text messaging, however text messaging plans start at $5 (for 250 outgoing and unlimited incoming) while an unlimited texting plan costs $15.
- Only the $75 and $95 plans include voice mail and caller ID. Caller ID costs $7 per month while voice mail costs $8 per month, however users can get both for $12, if they wish to add them to one of Bell's other rate plans.

Rogers:
Rogers has two different iPhone-specific plans which offer a mix of voice and data services. However, the company also has an extensive list of extra "value" packages which users can add to their existing plan for extra data or other features. Rogers customers don't have to sign up for an iPhone specific plan, however, in order to qualify for the discounted purchase price of the iPhone, they must sign up for a three year plan worth at least $45 per month. Customers can choose to build their iPhone pricing plan tailored to their own uses "a la carte" by combining any of the company's voice and data plans.

Plan One: $65
250 local minutes of talk time
Unlimited local calling after 9 p.m. and on weekends
75 outgoing text messages, unlimited incoming
1 GB of data
Visual Voicemail
Unlimited WiFi access at Rogers and Fido hotspots

Plan Two: ($80)
400 local minutes of talk time
Unlimited local calling after 9 p.m. and on weekends
100 outgoing text messages, unlimited incoming
2 GB of data
Visual Voicemail
Unlimited WiFi access at Rogers and Fido hotspots

Add-ons
$20 - Call display, enhanced voicemail, unlimited text and multimedia messaging, ringbacks, free evenings start at 6 p.m. instead of 9 p.m.
$40 - Call display, enhanced voicemail, unlimited text and multimedia messaging, 500 MB of additional data
$60 - 150 local minutes, 1,000 text messages, 1 GB of data
$60 - 150 local minutes, 1 GB of data, unlimited calling and texting with any 5 local numbers
$60 - 250 local minutes, 1 GB of data
$75 - 200 local minutes, 1,000 text messages, 1 GB of data

Extra data
$25 - 500 MB
$30 - 1 GB
$60 - 3 GB
$80 - 5 GB

Fine Print
- Rogers charges a $35 activation fee for each new device
- Rogers has done away with its "system access fee" however, it charges users an addtional "government recovery fee" of between $2.51 and $3.49 for each plan. Rogers added about $5 to each of its plans when it did away with the "system access fee." Combined with the "government recovery fee," the end result is almost unchanged for the customer.
- Rogers users can't combine additional data-only plans with iPhone-specific rate packages, but can build custom rate packages using the company's other talk and text packages
- Each of the two iPhone plans includes one month of free "MY5" unlimited talk and text with 5 local numbers
- Users who go over their allotted minutes will be charged $0.35 for each additional minute
- Additional data costs $0.50 for the first 60 MB then $0.03 for each MB thereafter
- Additional outgoing text messages cost $0.15 per message

Telus:
Telus opted not to create iPhone specific plans, but instead has four different Clear Choice plans which are designed to accommodate any of the company's multifunction smart phones, including iPhones, BlackBerrys and other devices.

Clear Choice Plan One: $50
150 local anytime minutes
Unlimited talk and text with 5 local numbers OR 1,000 outgoing and unlimited incoming text messages
Unlimited local calling after 9 p.m. and on weekends
500 MB of data
Also includes: Voice mail, call waiting and conference calling

Clear Choice Plan Two: $65
200 local anytime minutes
Unlimited talk and text with 5 nationwide numbers OR unlimited incoming and outgoing text messages OR double local anytime minutes
Unlimited local calling after 9 p.m. and on weekends
1 GB of data
Also includes: Voice mail, call waiting and conference calling

Clear Choice Plan Three: $80
350 local anytime minutes
Unlimited talk and text with 5 nationwide numbers OR unlimited incoming and outgoing text messages OR double local anytime minutes
Unlimited local calling after 9 p.m. and on weekends
2 GB of data
Also includes: Voice mail, call waiting and conference calling

Clear Choice Plan Four: $100
450 local anytime minutes
Unlimited talk and text with 5 nationwide numbers OR unlimited incoming and outgoing text messages OR double local anytime minutes
Unlimited local calling after 9 p.m. and on weekends
3 GB of data
Also includes: Voice mail, call waiting and conference calling

Fine Print
- Telus charges an activation fee of $35 per device
- Unlimited text messaging and called ID can be added to any plan for $15 per month
- Users will be charged $0.05 per MB if they go over their data plan allottment
- Telus users cannot add to their data plans
- Users going over their allotted minutes will be charged $0.35 per minute and $0.15 for each text message over their limit

**********

WHICH PLAN IS RIGHT FOR YOU?

For this final section, we've created three typical cellphone plans based on how much someone might use their phone and calculated approximately what each carrier would charge for that combination of options and features.

Light User: (150 minutes of daytime calling, 500 MB of data, voicemail, 250 outgoing text messages)

Bell: Combo 45 plan ($45) + voicemail ($8) + system access fee ($7) + 250 outgoing text messages ($5) = approx. $65 per month plus taxes

Rogers: iPhone Plan One ($65) + $20 Add on package with enhanced voicemail and unlimited text and multimedia messaging + GRRF ($3.50) = approx $88.50 per month plus taxes

Telus: Clear Choice Plan One ($50) + unlimited text messaging and caller ID package ($15) = approx. $65 per month plus taxes

Medium User: (250 minutes of daytime calling, 1 GB of data, voicemail, 500 outgoing text messages)

Bell: Combo 55 plan ($55) + voicemail ($8) + system access fee ($7) + unlimited texting package ($15) = approx. $85 per month plus taxes

Rogers: iPhone Plan One ($65) + ($20) Add on package with enhanced voicemail and unlimited text and multimedia messaging + GRRF ($3.50) = approx $88.50 per month plus taxes

Telus: Clear Choice Plan Three ($80) = approx $80 per month plus taxes

Power User: (At least 300 minutes of datytime calling, 2 GB of data, voicemail, unlimited text messaging)

Bell: Combo 75 plan ($75) + system access fee ($7) = approx. $82 per month plus taxes

Rogers: iPhone Plan Two ($80) + $20) add on package = approx. $100 per month plus taxes

Telus: Clearn Choice Plan Three ($80) = approx. $80 per month plus taxes

**********

SO WHAT HAVE WE LEARNED?

Hopefully this guide provides you with a starting or reference point which can help ease your decision if you do decide to get an iPhone.

Despite three different carriers offering the iPhone, users are going to end up paying roughly the same no matter which carrier they choose. All three carriers charge a $35 system access fee and the cost of the iPhone itself remains largely unchanged from carrier to carrier. While the rate plans each carrier offers for the iPhone may differ slightly in terms of features, number of minutes or options, prices are largely the same.

Please remember, the rate plans included here are the "advertised" plans offered by each carrier designed for the iPhone or smart phones. Rogers and Bell both have said that users who find all of the rate plans unacceptable can build their own plan from the company's other existing packages and each carrier has its own rules regarding pricing and services.

Chances are, if you want an iPhone (and actually use it) it's going to cost you at least $70 per month to operate it in Canada.

But please, if you are thinking about getting an iPhone, the most important thing you can do is shop around and remember to do your research.

Financial Post

FP Marketing: Subaru gets cozy with Snuggie

hollisha — Fri, 06 Nov 2009 14:36:00 GMT

In this week's FP Marketing, Subaru Canada takes down the infamous Snuggie infomercial — and Snuggie likes it! (See the ad here). Also, the Ad Missions team looks at BBDO's latest work for Swiss Chalet and finds it a bit stale.

Hollie Shaw

FP Tech Desk - Canadian New Media Awards announces 2009 nominees

Matt Hartley — Fri, 06 Nov 2009 14:17:00 GMT

The digital envelope please?

Canada's brightest rising digital media stars will be honoured next month at the Canadian New Media Awards, and this morning nextMEDIA unveiled the roster of nominees vying for top spot in 19 different categories ranging from mobile marketing and applications to best use of social media and interactive marketing. This year, three new categories were added to honour the best online video portal, best mobile application and brand of the year.

"As Canada's only nationweide new media competition of its kind, we're proud of the acheivements that this country's innovators have to offer," said Mark Greenspan, executive producer of nextMEDIA. "This year we're please to showcase some of the best work from many cutting edge companies."

Toronto and Southern Ontario lead the pack with 26 nominations, followed by Montreal with 13 and Vancouver with five while Quebec City and Ottawa each garnered three nominations. Companies from Halifax and Calgary were also nominated.

And the nominees are:

BEST BRAND OF THE YEAR:
Molson Coors - Coors Light, Toronto
BBDO/Proximity Canada - Doritos, Toronto
B360 Media Inc. - Bitchin' Lifestyle, Montreal

HOTTEST NEW DIGITAL KID ON THE BLOCK
ChickAdvisor Inc. - Toronto
Trinome Inc. - Montreal
Fuel Industries - Ottawa

PROMISING NEW COMPANY OF THE YEAR
Syncapse Corp. - Toronto
CoveritLive - Toronto
Polar Mobile - Toronto
Stitch Medai - Halifax
Zoompass - Toronto

BEST COMPANY OF THE YEAR
Cyberplex Inc. - Toronto
Vision Critical - Vancouver
Silverback Media - Toronto
Frima Studio Inc. - Quebec City
Vantrix - Montreal

BEST IN MOBILE MARKETING
Addictive Mobility - Brisk ARTwist, Markham
MyThum Interactive Inc. - Coors Light Colder than iPhone App, Toronto
MyThum Interactive Inc. - Rogers MTV Leak Live Tour, Toronto

BEST MOBILE APPLICATION
IBM Canada - Air Canada iPhone App, Markham
CanWest Media - Food Network Mobile App, Toronto
StreamTheWorld - StreamTheWorld, Montreal

BEST LOCATION BASED SERVICE
Xtreme Labs Inc. - Buzzd for iPhone App, Montreal
POIFriend/Simply Good Technologies - Scotiabank Nuit Blanche Night Navigator, Oakville
Multiplied Media - Poynt, Calgary

BEST USE OF SOCIAL MEDIA
Invoke Media - HootSuite Twitter application, Vancouver
Trinome Inc. - KWAD9, Montreal
EyeSteelFilm - Rip: A Remix Manifesto & Open Source Cinema, Montreal

BEST IN INTERACTIVE MARKETING
BBDO/Proximity Canada - Doritos White Bag, Toronto
Bluesponge - Montreal Canadiens Historical Website, Montreal
BStreet - Polar Ice Vodka, Toronto
Sweetspot.ca Inc. - The Sweetest Giveaway Yet, Toronto

BEST BRANDED ENTERTAINMENT
Frima Studio Inc. - Build-A-Bearville, Quebec City
Doug Agency - Worldwide Short Film Festival: Short Attention Span, Toronto
Ogilvy Toronto - Waking Up Hannah, Toronto

BEST CROSS-PLATFORM PROJECT
A51 Integrated & Smokebomb Entertainment Inc. - CTV's Listener Online Experience, Toronto
Xenophile Media - Cartoon Network's "Total Drama Island - Totally Interactive" Toronto
National Film Board of Canada - Waterlife Interactive, Toronto

BEST ONLINE VIDEO PORTAL
MovieSet Inc., Vancouver
National Film Board of Canada - NFB Online Screening Room, Toronto
Kung Fu Numerik Inc./ Turbulent, Montreal

BEST INNOVATIVE WEB-BASED GAME
Social game Universe - Avastar Social Facebook Application, Toronto
Frima Studio Inc. - Build-A-Bearville, Quebec City
Antic Entertainment - Junk Battles, London

BEST KIDS INTERACTIVE
Tribal Nova - Kids' CBC Wonder World, Montreal
Fuel Industries - Spark City/ AllGirlArcade.com, Ottawa
mod7 - Titanium Chef, Vancouver

BEST IN CANADIAN CULTURE, INTERACTIVE
Bluesponge - Canadian Center for Architecture, Montreal
ecentricarts Inc. - Textile Museume of Canada inTouch, Toronto
Isuma Distribution International - Isuma TV, Montreal

LEADER IN SOCIAL CHANGE
Mark Surman, Excecutive director, Mozilla Foundation
Tonya Surman, Executive director, Centre for Social Innovation

BEST ONLINE COMEDY PERFORMANCE
Tetes a Claques, Montreal

BEST ONLINE ARTISTS OF THE YEAR
K-OS, Vancouver

LIFETIME ACHIEVEMENT AWARD
Red Burns, "Grandmother of new media and founder of the ITP program at the Tisch School for the Arts at NYU"

Canada's October employment report: Economists comment

Eric Lam — Fri, 06 Nov 2009 13:10:00 GMT

Canada's job market declined far more than economists forecasted in October, erasing much of the gains of the past two months as more than 43,000 Canadians lost their jobs while the unemployment rate jumped to 8.6%. Consensus median had been for +10,000 jobs and an unemployment rate of 8.5%. Here is a smattering of analysis:

Ian Pollick, economics strategist, TD Securities

The subtext to this report is simply that the Canadian economy had been adding labour at a much faster pace than could be sustained, and as a natural consequence, employment declined in October. We had expected the recent pace of improvement in the labour market to be unsustainable, and we were proven correct. Having said that, while this is undoubtedly a weak report, recall that the Canadian economy has contracted in 12 of the last 13 months. This might put some perspective on the weak print this month, and going forward we expect monthly gains or losses in employment to be somewhat less pronounced.

Derek Holt and Karen Cordes, economists, Scotia Capital

We were on the right side of consensus this morning and the right side of zero, looking for a drop of 5,000 jobs in October, compared to consensus estimates for a 10,000 gain. As we have been arguing for some time, the recent labour numbers seemed overstated, especially with the public sector and self-employment driving most of the gains. Nonetheless, this report suggests that all is not well in the domestic economy, increasing the downside risks to inflation in the near term. As such, we continue to see the Bank of Canada on hold for longer than their current June 2010 conditional commitment.

Benjamin Reitzes, economist, BMO Capital Markets

The details of the report were mostly weaker, with the only positive news that the entire drop was in part-time jobs, while full-time positions recorded a decent gain. The headline decline would have been even deeper if not for the 27,500
increase in self-employment. While employment is still higher over the past three months, the big decline in October highlights the sluggish nature of the recovery and reinforces our expectation that the Bank of Canada will hold true to its commitment to hold rates steady until at least June 2010.

Avery Shenfeld, chief economist, CIBC World Markets

Canadian employment was much worse than expected in October, with a 43K decline suggesting that the prior two months tallies might have included an over-estimate, given that these are survey results. Heavy job shedding at both private and public sector employers were offset by a gain of 28K self-employed positions, often an indication of lower paying work. Job losses hit retailing and wholesaling, with factories essentially flat and construction seeing modest gains. Overall, a much weaker report that is more in line with the poor reports we were seeing for GDP. Negative for the C$, supportive for fixed income markets.

Eric Lam

FP Tech Desk - Richard Branson calls out Rogers over mobile fees

Matt Hartley — Fri, 06 Nov 2009 12:30:00 GMT

A war of words is brewing between playboy billionaire Richard Branson and Canadian cable giant Rogers Communications Inc.

The Chairman of Virgin Group and the founder of Canada's Virgin Mobile has called out Rogers over its recent announcement to remove its "system access fee" for mobile devices and replace it with a new "Government Regulatory Recovery Fee."

Mr. Branson calls the move nothing but "smoke and mirrors" and demanding "new standards in the mobile industry that would abolish bogus, made-up fees and force mobile companies to stop misleading consumers."

Unfortunately, owhere in the five paragraph press release does Mr. Branson mention that Virgin Mobile is now owned by Canadian telecom giant BCE Inc., parent company of Rogers' chief rival Bell Mobility, which also just happens to be the only Canadian carrier which has not done away with the "system access fee" moniker.

“I’d like to congratulate Rogers for removing one fee that never made sense, but I’m perplexed to hear that they’ve replaced it with another equally confusing one," Mr. Branson said in the statement.

"I suppose that they hoped by putting ‘Government’ in the title that people would assume the fee is legitimate. It clearly states in Rogers’ own advertising fine print that ‘It is not a tax or charge that the government requires Rogers to collect.’ Are they deliberately trying to mislead the public?”

Virgin Mobile plans to launch a national ad campaign that directly calls out Rogers' decision to change the name of the fee. Just what Canadians need, another ad campaign from a major telecom or cable company griping about the practices of one of their competitors.

Let's all hope that Virgin Mobile's campaign doesn't result in another annoying series of TV spots reminiscent of that irritating "Stop the TV Tax" guy.

Later in the release, Mr. Branson says "Canadians are smarter than that and they deserve to be treated better."

He's right. How about starting with full disclosure?

C'mon Canada. Enough is enough.

FP Tech Desk - Morning Buzz (Jobs is CEO of the decade, No Doubt pulls a Courtney Love and Google CEO talks about the future of the Web)

Matt Hartley — Thu, 05 Nov 2009 16:21:00 GMT

A sampling of what's making news and causing conversations around the Web:

Gwen Stefani is no Courtney Love -- and that's a good thing -- but the bombshell No Doubt lead singer and her bandmates seem to have a similar axe to grind with video game giant Activision, creator of the popular Guitar Hero and Band Hero titles. Gamasutra is reporting that No Doubt has sued Activision because their avatars in Band Hero can perform songs by other artists, something they say breaches their contract. Activision faced similar heat earlier this year from Ms. Love -- widow of grunge legend Kurt Cobain -- and Mr. Cobain's fellow Nirvana band members Krist Novoselic and Dave Grohl who condemned Activision for including an all purpose Kurt Cobain avatar that could perform songs from other artists in Guitar Hero 5.

University of Ottawa professor and Canadian copyright guru Michael Geist suggests the Canadian government needs to take a more progressive approach to its own copyright policy after the Auditor General's office sends takedown notices to The Globe and Mail and Scribd for posting a chapter from her report.

What will the Web look like in five years? Read Write Web has posted a six minute clip of Google CEO Eric Schmidt answering this question at a recent speaking engagement hosted by market researchers Gartner Inc. So what does the future of the Web look like? Mr. Schmidt said the Internet will be dominated by Chinese language content, the lines between TV and the Web will continue to blur and if you want to see how people will interact and communicate in the future, then watch what teenagers are doing today.

Fortune Magazine has named Apple Inc. CEO Steve Jobs "CEO of the Decade." When you pause and realize that 10 years ago, the world had never heard of the iPod or the iPhone and then think about influence the Jobsian One has had on both the technology industry and pop culture over the past decade, his selection seems like an obvious choice.

Vista who? Market research firm The NPD Group is reporting that U.S. sales of Microsoft Corp.'s new Windows 7 operating system were 234 per cent higher than those of Windows Vista in its first few days of sales.

FP Tech Desk - CPPIB may soon get its share of Skype

Matt Hartley — Thu, 05 Nov 2009 15:54:00 GMT

The deal which would give Canadians an ownership stake in Skype appears to be drawing closer to fruition.

Bloomberg News is reporting that the two founders of Skype, who were engaged in a legal dispute with Skype's parent company eBay Inc., have agreed to join the consortium of companies planning to purchase the Web-calling technology firm, a group that includes the Canada Pension Plan Investment Board.

Citing people "familiar with the matter," Bloomberg reports that an announcement regarding the deal could be made as early as today.

CPPIB, along with a group of U.S. private equity firms led by Silver Lake, agreed to purchase a 65% stake in Skype from eBay for $US1.9-billion back in early September. CPPIB put up US$300-million in cash for a 15% stake in Skype, pegging the value of the technology company at about US$2.75-billion.

Skype -- a popular VoIP (voice over Internet protocol) service that allows users to make free video and voice calls over the Internet, was developed by Estonian entrepreneurs Niklas Zennstrom and Janus Friis, who sold the technology to eBay in 2005.

Bloomberg reports that Mr. Zennstrom and Mr. Friis have sign on to join the Silver Lake-led group in return for dropping their lawsuits against Skype. The pair owned the background software code for Skype and had accused eBay of violating a long standing licensing deal, eventually launching legal action in September.

The San Jose, California-based auction house intended to use Skype's technology to improve communication between buyers and sellers using its online auction service, but those plans never panned out. Investors have pressured eBay executives to unload its controlling stake in Skype -- which is seen as having a great potential for profits, but a poor fit for eBay's business -- for some time, either through a sale or an initial public offering.

Google opens up about what it knows about you with Dashboard

Matt Hartley — Thu, 05 Nov 2009 15:41:00 GMT

Ever wonder what Google knows about you and what you do online? Wonder no more.

Early this morning, Google took the wraps off Google Dashboard, a new site where any user with a Google account -- such as a Gmail address -- can log in and see what information and personal data the search engine powerhouse stores concerning their web habits.

On the one hand, it's a useful starting tool for anyone looking to access multiple Google services, such as Blogger, YouTube or Gmail.

At the same time, however, Dashboard provides a sobering look at just how much technology companies like Google -- as well as other search engines and social networking sites such as Facebook -- know about their users and how much personal information Canadians are trusting to the Internet.

"We think of this as a great step towards giving people transparency and control over their data, and we hope this helps shape the way the industry thinks about these issues," said Alma Whitten, Google software engineer on privacy and security. "It's important for people to be aware of what data they have online and to be able to manage that data--Google Dashboard should help to make this a reality."

Dashboard gives users a peek at the data Google collects and stores whenever they use about 20 of the tech company's Web services, and allows users to easily view and change their privacy settings.

Users can find almost anything about their Google use habits, everything from the number of messages in their Gmail inbox and the spreadsheets in Google Docs to the videos they have saved on YouTube and of course, their search history.

The search history tab, for example, shows the last several Web queries performed from that Google account -- provided the user has turned on that function -- but also includes a link Google's search engine privacy policy and offers users the ability to wipe searches from their history.

So that "Taco Bell menu" search you did at 3 a.m. last night can be easily found and erased.

At the same time, the ability to scroll through your personal search history dating back more than a year can be illuminating to say the least. Wondering what Google searches you were doing the day Michael Jackson died or what you were looking for online on New Year's Eve last year? It's all there.

Most of the items include a tab labeled "privacy and security help" which opens a new page containing information on how a user can change their password, keep certain details private or clear items they might not want others to see.

The service also takes the guesswork out of which aspects of their personal information are public and which stay locked up inside Google's databases. YouTube favourite videos for example, are clearly labeled as public.

For more information on Google Dashboard, here's a video explaining how it works from Google.

Was Bonderman the force behind GM's decision to keep Opel?

Drew Hasselback — Thu, 05 Nov 2009 14:03:00 GMT

There were a lot of changes at General Motors over the summer, but it's beginning to look like the most important one for failed-Opel-bidder Magna International was the election of takeover heavyweight David Bonderman to the auto giant's board of directors.

After GM's board opted this week to keep Opel, there has been speculation about which directors could have pushed forcefully enough to wipe out the Magna-led offer. After all, that bid had been given the nod by the German government, GM's CEO and virtually every trade union connected with the sprawling European division.

Bloomberg news is reporting that Bonderman -- the chairman of Ryanair Holdings and founder of buyout fund TPG Capital LP -- pushed to keep Opel. The wire service report quotes unidentified sources saying Bonderman told peers at a dinner the night before the board meeting that Magna was paying too little for the unit, among other issues.

Stephen Girsky, a former Wall Street analyst and the member of the board represented retired U.S. auto workers, was reportedly making similar assertions. Carol Stephenson, dean of the Richard Ivey School of Business at the University of Western Ontario, is Canada’s representative on the board.

The board features other business heavyweights, but Bonderman would have stood out as the foremost turnaround expert. TPG, formerly known as Texas Pacific Group, have been involved in some huge successfully restructurings, including Continental Airlines, J. Crew and Burger King.

Grant Ellis

IMF begins mission to Canada

Alia McMullen — Wed, 04 Nov 2009 22:38:00 GMT

The International Monetary Fund arrived in Toronto Tuesday for day one of its mission to Canada, which will include talks with the Bank of Canada, the Department of Finance, private sector groups and academics. Charles Kramer, the IMF mission chief to Canada, said the organization aimed to present the mission's findings on November 12.

The IMF said in its October World Economic Outlook report that the Canadian economy would likely shrink 2.5% in 2009 before growing 2.1%, an outlook which falls below the general consensus. Mr. Kramer said the IMF believed the Canadian recovery would be slightly softer than the market has predicted because the U.S. recovery from the financial crisis would likely be subdued. However, he said Canada was better positioned than most countries heading into recovery.

The IMF mission met with private sector banks Tuesday and will travel to Montreal on Friday as part of this year's special focus on Quebec. Mr. Kramer said the IMF would look at the role of Quebec's economy in Canada, following last year's special focus on Alberta.
He said the mission would then travel to Ottawa to meet with the Bank of Canada and the Department of Finance on Monday and Tuesday to discuss the economy and policy issues.

Alia McMullen

Bell and Rogers both claim handset supremacy

Jamie Sturgeon — Wed, 04 Nov 2009 21:41:00 GMT

Knotted up in terms of network technology as of this morning, Bell Canada and Rogers Communications are now waging a public-relations war on which cellphone provider boasts the best handset lineup.

"With today's launch of its all-new national HSPA network, Bell confirmed its position as the Canadian wireless provider delivering the broadest range of choice in wireless smartphones," the phone company said in a statement.

The new HSPA, or high-speed packet access network technology gives Bell the ability to offer dozens of devices once unavailable to it, like Apple's smart phone, the iPhone (which Bell and Telus are beginning to sell now).

HSPA is the same kind of network standard that Rogers uses, meaning Canada's biggest cellphone provider has lost its monopoly over the iPhone and other phones designed exclusively for HSPA.

Bell says it offers some 40 handsets overall, including 18 smartphones.

(UPDATE: Bell has confirmed it has 45 wireless devices in total. Thirteen operate on HSPA, the remaining 32 are designed for the CDMA, or code division multiple access, the network standard both Bell and Telus were using previously, and continue to use alongside HSPA.)

Also on Wednesday, Rogers issued its own press release:

"Rogers customers can select from an even greater [italics added] lineup of the latest wireless devices — the widest selection by far in Canada — with the introduction of new smart phones designed to keep Canadians connected on Canada's most reliable network."

Its device count stands at "close to" 50, including its turbo-stick products that connect laptops to its wireless network, Rogers said. (UPDATE: The 50 figure includes 30 HSPA devices. The remainder rely on Rogers older GSM network standard.)

Jamie Sturgeon

U.S. Fed November rate decision: Economists opine

Eric Lam — Wed, 04 Nov 2009 19:30:00 GMT

U.S. Federal Reserve chairman Ben Bernanke and the Federal Open Market Committee ended two days of meetings Wednesday with a decision to keep the target fed funds rate at between zero and 25 basis points and highlighted slight improvements in the economy, in line with consensus expectations. Analysts throw in their two cents:

Kurt Karl, chief U.S. economist, Swiss Re

The third quarter GDP report indicated more broad-based demand growth than expected, so the forecast for growth has improved a bit. The risk of a sharp deterioration in growth next year is now closer to 20% — down from 25% a couple of months ago — while the upside risk of a “V” recovery remains a 15% probability. Excess labor and capital capacity will contain inflation for at least a couple of years. Oil prices are expected to return to close to $70 bbl later this year and next year. Under the baseline forecast, real GDP growth is expected to decline 2.5% in 2009, but rise by 2.5% next year and 3.5% in 2011. The yield on the 10-year Treasury note will stay mostly in the 3.3% to 4.0% range through the end of 2010.

Andrew Pyle, wealth advisor, ScotiaMcLeod

While the statement is rather neutral, equity markets have lost ground since the announcement. Part of the problem is perhaps the lack of a real upgrade in the Fed's assessment of the economy, though it does see a gradual return to higher levels of capacity utilization. As I've argued before, it is premature for the Fed to start dropping hints about potential changes to the timing for initial tightening measures, especially when monthly job cuts are in the 200,000 area. I would suspect that if we see marked improvement in employment conditions in November, the December 16th meeting would be a better bet for the markets in this regard. In terms of bonds, the short-end of the US yield curve has benefited from the statement, but we're seeing pressure on longer issues. No real changes in currencies.

Steven Wood, chief economist, Insight Economics

The FOMC kept the federal funds rate at levels that have not been seen in the post-World War II period, indicating how extremely fragile they view the current economic and financial condition. In addition, the Fed has maintained its commitment to use its balance sheet to try to support the housing market and economy more generally. The Committee is prepared to keep interest rates very low for an extended time (an attempt to keep intermediate and long-term rate down). The Fed, and fiscal and market forces, have generated the beginnings of an economic recovery and resolved much of the financial market dislocations. Although not stated, the Committee is actively discussing their exit strategy, both timing and procedure, although nothing is imminent.

Derek Holt and Karen Cordes, economists, Scotia Capital

As we have been saying all week, the FOMC is not yet ready to shift the tone of its rate statement given continued uncertainty over the economic outlook. And, today’s statement didn’t disappoint, remaining dovish with very little change to comments on growth and inflation from the previous statement. While we didn’t obtain any hint at forecast revisions in this release, we will get all of the changes in the minutes to this meeting in two weeks time.

Eric Lam

U.S. Federal Reserve policy announcement for Nov. 4, 2009

Drew Hasselback — Wed, 04 Nov 2009 19:21:00 GMT

Release Date: November 4, 2009

For immediate release

Information received since the Federal Open Market Committee met in September suggests that economic activity has continued to pick up. Conditions in financial markets were roughly unchanged, on balance, over the intermeeting period. Activity in the housing sector has increased over recent months. Household spending appears to be expanding but remains constrained by ongoing job losses, sluggish income growth, lower housing wealth, and tight credit. Businesses are still cutting back on fixed investment and staffing, though at a slower pace; they continue to make progress in bringing inventory stocks into better alignment with sales. Although economic activity is likely to remain weak for a time, the Committee anticipates that policy actions to stabilize financial markets and institutions, fiscal and monetary stimulus, and market forces will support a strengthening of economic growth and a gradual return to higher levels of resource utilization in a context of price stability.

With substantial resource slack likely to continue to dampen cost pressures and with longer-term inflation expectations stable, the Committee expects that inflation will remain subdued for some time.

In these circumstances, the Federal Reserve will continue to employ a wide range of tools to promote economic recovery and to preserve price stability. The Committee will maintain the target range for the federal funds rate at 0 to 1/4 percent and continues to anticipate that economic conditions, including low rates of resource utilization, subdued inflation trends, and stable inflation expectations, are likely to warrant exceptionally low levels of the federal funds rate for an extended period. To provide support to mortgage lending and housing markets and to improve overall conditions in private credit markets, the Federal Reserve will purchase a total of $1.25 trillion of agency mortgage-backed securities and about $175 billion of agency debt. The amount of agency debt purchases, while somewhat less than the previously announced maximum of $200 billion, is consistent with the recent path of purchases and reflects the limited availability of agency debt. In order to promote a smooth transition in markets, the Committee will gradually slow the pace of its purchases of both agency debt and agency mortgage-backed securities and anticipates that these transactions will be executed by the end of the first quarter of 2010. The Committee will continue to evaluate the timing and overall amounts of its purchases of securities in light of the evolving economic outlook and conditions in financial markets. The Federal Reserve is monitoring the size and composition of its balance sheet and will make adjustments to its credit and liquidity programs as warranted.

Voting for the FOMC monetary policy action were: Ben S. Bernanke, Chairman; William C. Dudley, Vice Chairman; Elizabeth A. Duke; Charles L. Evans; Donald L. Kohn; Jeffrey M. Lacker; Dennis P. Lockhart; Daniel K. Tarullo; Kevin M. Warsh; and Janet L. Yellen.

2009 Monetary Policy Releases