Bizmology |
| GM goes public – “Government Motors” (almost) no more Posted: 18 Nov 2010 09:29 AM PST
There’s of course been much debate about the wisdom of the GM bailout, much like the debates about TARP and similar actions taken to save financial institutions from the wreckage of bankruptcy and liquidation. To me, GM’s bailout was a success and blunts criticism of government wanting to take over businesses. The Obama administration has no desire to be in the auto business, but it wisely recognized that there was more at stake than just GM jobs if the company went under. The ramifications of a GM collapse would have been staggering for small business and the middle class. Dealerships, mechanics, auto parts retailers, to name just a few, would also have gone down and sent even more people onto the unemployment roles. Government intervention helped the company turn things around and with the public offering, the US government is making good on its promise to eliminate its ownership stake as quickly as possible. The Treasury’s stake in GM is now cut in half and in six months it plans to gradually sell the rest. So far the US has lost about $4.5 billion on GM shares and it will need the stock to perform well down the line if it hopes to break even or possibly turn a bit of a profit for the taxpayers. Is this an ideal use of taxpayer money? No. Was it necessary to prevent an already horrible economic crisis from getting worse? Yes. The problems GM faced were of its own making, no question. It continued to turn out a poor quality product and never had an answer for the foreign competition eating its lunch. Now that it’s back on solid financial ground, hopefully the company has learned its lesson and gets back to making quality American cars and creating American jobs. That’s good for all of us. |
| Posted: 18 Nov 2010 07:50 AM PST
“The Beatles,” read the triumphant iTunes Store unveiling. “The band that changed everything is now on iTunes.” Question is, what, if anything, does this change now? The Fab Four’s long and winding road to digital release has been fraught with litigation. In 1978 the band sued Apple for infringing on its business management company of the same name, the first of several courtroom battles that would ensue between the Liverpudlians and the Cupertino firm. Surviving members of the band furthermore refused for years to release their catalog in digital format, claiming the medium simply failed to meet their standards. Jobs has made no secret of his love for the band, and has relentlessly pursued music’s biggest digital holdouts since iTunes launched in 2001. Now, with sales of digital tracks slowing in the US, it seems the Beatles’ long overdue iTunes debut seems a tad late to the party. Single track sales stagnated in 2010, compared to a 13 percent boost in 2009 and 28 percent growth the year before, according to Nielsen. Combined with albums, total digital music sales eked out a 5 percent jump. While their timing may be off, the band’s digitization nonetheless appeals to a couple of important demographics: hard-core fans and those who passed over last year’s remastered box set. Indeed, The Beatles Box Set retails for $40 less on the iTunes Store than at The Beatles Store, all trimmings included. Albums retail for about $2 less on iTunes as well. Not bad, but not the makings of a big payday. Still, if Jobs is happy, then the rest of the world can sleep easy. Meanwhile, I’m still waiting for iTunes to pour some sugar on me. |
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