Battleground: Target practice
Target wasn’t nearly as thrilled as Beyoncé’s fans when the pop singer dropped her latest album, without warning, only on Apple’s iTunes store. Miffed by the week-long exclusive deal, the retail giant later declined to sell the CD version of Beyoncé’s self-titled album in any of its stores, saying, “We are primarily focused on offering CDs that will be available in a physical format at the same time as all other formats.” Amazon, too, declined to sell the CD through its popular website. Undeterred, Beyoncé responded by strolling through the aisles of a Massachusetts Wal-Mart store, showering shoppers with $50 gift cards.
Beyoncé’s bold gambit appears designed to wrest more control for artists in a changing music industry—and, so far, it seems to be working. Her album has already become a best-seller despite the backlash from retailers. Even Apple, the other supposed big winner in all of this, agreed to sell only the full album on iTunes (as opposed to individual 99-cent tracks, which is its preference), suggesting Target may not have been the only one with a bull’s eye painted on its back.
- Canada’s economy grew more than expected in October, at 0.3 per cent, lifted by the largest monthly gain in manufacturing in two years.
- U.S. consumer confidence rose to its highest level in five months in November, according to the University of Michigan. That bodes well for retailers.
- A joint review panel recommended Ottawa approve the Northern Gateway pipeline, subject to conditions—a small step to unlocking oil sands wealth.
- The U.S. Federal Reserve finally began to wean the economy off easy money by reducing its qualitative easing stimulus program. And the world didn’t end.
- Italy’s Prime Minister Enrico Letta said the economy is out of the “emergency room” after the country’s GDP stopped contracting for the first time in two years. Buono!
- The percentage of American mortgages in foreclosure fell 29 per cent in November, compared to the year before, to 2.5 per cent, the lowest level since late 2008.
- Corporate profits in America, as a share of GDP, are at their highest level since the 1940s. Which is good, assuming they start to do something with that cash, like invest and hire.
- Expect Canadians to add to their already daunting debt loads in 2014, according to TransUnion. The credit firm forecasts average non-mortgage debt levels to rise four per cent to $28,853.
- American home sales fell in November. At an annualized rate of 4.9 million units sold, that’s the lowest rate in a year, and down 9.1 per cent from three months prior.
- The number of mortgage applications in the U.S. has plunged in the face of rising rates. The average number of applications fell 6.3 per cent to a 13-year low, according to the Mortgage Bankers Association.
- Rating agency Standard & Poor’s downgraded the European Union’s debt from AAA to AA+. The move could mean countries that got bailout funds will have to pay more.
- Canadian shoppers cut back in October. Retail sales slipped 0.1 per cent that month, the first decline in four months. Are we all tapped out?
- Chocolate prices are rising as a result of a shortage of cocoa. At close to US$2,800 per tonne, cocoa prices are at their highest level in two years. Nothing sweet about that.
- Interest rates in China are way up. Rates more than doubled in December to 10 per cent. In response, censors banned Chinese media from using the term “cash crunch.”
- Shares of Apple got a big boost, up nearly four per cent to $570, after the company signed a deal with China Mobile. And it’s little wonder why. The carrier boasts 760 million subscribers—more than double the population of the United States.
- A Dutch arbitration panel has ordered high-end jeweller Tiffany & Co. to pay Swatch $450 million, or more than a year’s earnings, after a joint-venture deal fell apart. Might have been cheaper just to make the watches and toss them in the garbage.
- Google’s plan to show rivals’ shopping sites in a special box on its search page, among other things, is insufficient to eliminate antitrust concerns, European regulators have ruled. Meanwhile, Canada’s Competition Bureau has signalled it plans to launch its own investigation to find out whether Google is abusing its market dominance.
- Mark Zuckerberg, the hoodie-wearing Facebook CEO, is taking advantage of the stock’s recent surge above $55 a share. He recently raised $2.3 billion through a complex secondary sale of shares in the company—the first time he has sold shares since Facebook’s underwhelming IPO.
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