Citi plans to cut bonuses by up to 10%

Citigroup plans to cut bonuses and continue cutting headcount as the bank's shares remain down nearly 90% since before the crisis.

NEW YORK (CNNMoney) -- Citigroup (C, Fortune 500) plans to slash bonuses up to 10% as it continues to trim its staff.

Average employees should expect their bonuses to be cut between 5% and 10% this year, according to a source with knowledge of the firm's year-end compensation plans.

However, Citigroup's top performers are not expected to feel the pinch, the source said.

A Citigroup spokesperson declined to comment on the bonus reductions but the bank did acknowledge that it will continue cutting its staff.

"We have been making targeted headcount reductions throughout the year in certain businesses and functions across Citi as part of our efforts to control expenses during the current environment," said Citi spokesperson Danielle Romero-Apsilos.

Related: Citigroup shareholders push for break up

Investors should get more insight into Citi's plans next week, when CFO John Gerspach speaks at a Goldman Sachs financial services conference. During his presentation, he's expected to announce 150 job cuts in Citi's investment banking division by year-end, said the source.

Citigroup continues to eliminate the higher-paying investment banking jobs but the pace of the cuts has been slowing. In the fourth quarter of 2011, Citigroup announced 1,200 layoffs in its investment banking division. The bank cut an additional 350 investment banking jobs in the first half of 2012.

It's been a rocky year for Citigroup. The bank's former CEO Vikram Pandit stunned investors when he announced his immediate departure in mid October, one day after discussing plans for the bank's future on a quarterly conference call.

Related: Pandit's inner circle breaks up

The bank's new CEO, Michael Corbat, is a 29-year veteran of the bank, and he now faces the task of getting Citi onto a more profitable path amid continuing calls to shrink the bank.

Citigroup's board must also wrestle with the ousted CEO's 2011 pay package. Citigroup's shareholders voted down his $15 million pay package during the bank's annual shareholder meeting. While Citigroup said it's been privately meeting with investors, the bank doesn't expect to say much publicly before next year.

Citigroup's shares are up 34% this year, but remain down nearly 90% since the financial crisis. While all bank have struggled to get back near pre-crisis highs, Citigroup's share have been the worst performing bank stock by a wide margin.

First Published: November 29, 2012: 2:49 PM ET

08.36 | 0 komentar | Read More

Judge OKs bonuses for execs in Hostess liquidation

Hostess manufactured products including Twinkies, Ding Dongs and Wonder Bread.

WHITE PLAINS, N.Y. (CNNMoney) -- A federal bankruptcy judge finalized the liquidation of Hostess Brands on Thursday and approved a bonus plan for senior executives involved in the wind-down of the company.

Union representatives had opposed the plan, which offers $1.75 million in bonuses ranging from $7,400 to $130,500 for 19 executives, provided they meet certain benchmarks in managing the liquidation. But Judge Robert Drain said the plan was appropriate, citing testimony that it had been independently vetted and was below market value for firms in similar circumstances.

He said the liquidation would call for work "significantly beyond the type of jobs that [the executives] were doing at the start of this case," and called the incentive plan "an exercise of proper business judgment."

He noted that the over 3,000 rank-and-file employees assisting in the liquidation were also getting paid beyond their regular salaries, and that new Hostess CEO Greg Rayburn had ruled out a bonus for himself.

Drain declined to appoint an independent trustee to oversee the liquidation, saying it was not necessary but could be later if circumstances change.

On Nov. 21, Drain gave preliminary approval for the company to shut down after 82 years in business. This followed a failed attempt to mediate a dispute between the company and its bakery workers' union over wage and benefit cuts imposed through bankruptcy court.

Related: Hostess jobs: 'Great' to 'not worth saving.'

The union said its membership was overwhelmingly opposed to the concessions agreed to by other Hostess employees, including the majority of the 6,700 members of the Teamsters' union. The bakers walked off the job on Nov. 9, and Hostess filed for liquidation a week later.

The bakers' union has repeatedly said that mismanagement and the company's debt were responsible for its failure, not the strike. This is Hostess' second trip to bankruptcy court since 2004; it emerged from restructuring in 2009 before filing for bankruptcy again in January.

Paul Carroll, 60, a former fleet mechanic for Hostess from Fort Thomas, Ky., drove 12 hours to be heard at the hearing. He said every move the company's previous management made "brought us down further," calling for Hostess to make good on its millions in outstanding pension obligations to employees.

Related: The day the Twinkies died: What the Web said

The bakers' union has also criticized Hostess' previous management for demanding benefit cuts while allegedly providing raises for the CEO and other top executives. Drain said this incident "will definitely be looked at" as the case progresses.

Going forward, Joshua Scherer, an investment banker from Perella Weinberg who is advising Hostess, told the court that there had been huge interest in the company's brands and assets from potential buyers.

Related: Twinkies hoarding begins

It's possible some buyers would rehire ex-Hostess staffers and reopen the company's plants, though others could simply produce former Hostess products with their own resources.

In the meantime, Carroll is looking for work.

"It's really sad that a lot of people in these bakeries aren't going to find good jobs from here on out," he said outside the court.

First Published: November 29, 2012: 5:59 PM ET

08.36 | 0 komentar | Read More

Facebook and Zynga tear up their contract

Facebook formerly had a unique deal with Zynga, but the amended contract makes the partnership much more similar to that of other developers.

NEW YORK (CNNMoney) -- Facebook and Zynga have always been deeply intertwined, but the companies signed paperwork this week to make their relationship a bit more distant.

A pair of regulatory filings submitted late Thursday revealed that Facebook and Zynga have significantly revised the terms of a five-year deal they signed in late 2010. The new arrangement relaxes restrictions on both Facebook and Zynga, the gamemaker that drove 13% of Facebook's revenue for the first nine months of 2012.

Facebook will no longer be prohibited from developing its own games. That part of the deal isn't great for Zynga, which slashed both its workforce and its 2012 outlook last month after announcing disappointing performance for some games.

But Facebook released a statement saying the company is "not in the business of building games and we have no plans to do so. We're focused on being the platform where games and apps are built."

Despite that, Zynga investors sent the FarmVille maker's shares plummeting 11% in after-hours trading.Facebook (FB) shares remained flat.

Much of the deal was positive for Zynga (ZNGA), which shook off a few Facebook shackles.

The company won't have to use Facebook as the exclusive way to log into games on the newly launched Zynga.com, which Zynga hopes to build into a standalone gaming destination.

Even sweeter: Zynga won't be required to use Facebook's ads or virtual payment system on Zynga.com. That system typically gives Facebook a 30% cut of all sales that flow through it.

Finally, Zynga is no longer required to use Facebook "as its primary non-Zynga platform." But any new game must launch on Facebook "concurrent with, or shortly following" its debut on Zynga.com or any other social platform.

One especially provocative tidbit: As Zynga moves into "real money gambling games," Facebook wants to follow.

In countries where Zynga offers such games (they're banned in the U.S.), the new rules say Zynga must make those games available on Facebook if Facebook's local site allows them. Zynga struck its first real-cash gaming deal last month with bwin.party, an international gaming operator. It plans to launch poker and casino games in the U.K. early next year.

In an emailed statement, Zynga chief revenue officer Barry Cottle said the amendment "continues our long and successful partnership while also allowing us the flexibility to ensure the universal availability of our products and services."

First Published: November 29, 2012: 6:42 PM ET

08.36 | 0 komentar | Read More

Groupon CEO: I'm not surprised about firing rumors

Groupon CEO Andrew Mason says "if I ever thought I wasn't the right guy for the job, I'd be the first person to fire myself."

NEW YORK (CNNMoney) -- Rumors are swirling that Groupon's board is considering replacing founder and CEO Andrew Mason with a more experienced leader, but he's not surprised. Or even particularly upset.

"Our stock is down 80% [year-to-date] ... it would be weird for the board not to be asking that question," Mason said at the Business Insider Ignition conference in New York City on Wednesday.

"It would be more noteworthy if the board wasn't discussing it," Mason added.

Mason's Ignition appearance was scheduled long before rumors of board members' discontent appeared in an All Things D article Tuesday, later echoed by other media outlets. Moderator Henry Blodget kicked off the discussion by asking about the rumors, and that line of questioning continued throughout their talk.

Mason wiggled out of questions about whether he would "fight" to keep his job, shifting the focus instead to the company overall.

"I care far more about the success of the business than I do about my job as a CEO," Mason said at one point. Later, when pushed specifically on whether he really does want to keep the CEO title, Mason said simply: "I want what's best for Groupon."

Still, he insisted that "if I ever thought I wasn't the right guy for the job, I'd be the first person to fire myself."

Blodget also grilled Mason on Groupon's flagging reputation. The CEO has stayed relatively quiet while Wall Street and the media piled on "an incredible amount of scorn," Blodget suggested.

Shares of Groupon are currently trading around $4, compared with their IPO price of $20 in November 2011.

Mason replied: "Our stock is going to reflect our long-term performance. I don't think you can talk the stock back up to 20 bucks. You have to deliver."

He acknowledged that Groupon (GRPN) has work to do on that front, but he simultaneously downplayed the importance of critics' complaints.

"We've built up a resiliency to the external noise," he said. "We'll look back at these war stories and be glad we went through that ... there's something romantic about proving the naysayers wrong."

Mason was far less impressed by Blodget's next question, which devolved into a long diatribe about Blodget's own "fall from grace" after being charged with securities fraud in 2003 for his actions as a stock analyst. Blodget talked about how the accusations "hurt," and he asked Mason how the firing rumor "feels ... you know, when you're at home."

Mason held for an awkward beat, and when his answer came, it was clear he found the question silly.

"I don't really know what you want me to say...." he trailed off. "'Sure, Henry, it feels great'? I mean, obviously, no. It doesn't feel good."

First Published: November 28, 2012: 2:14 PM ET

08.37 | 0 komentar | Read More

Customer complaints soar at Toys R Us

Toys R Us shoppers are taking to the retailer's Facebook page to complain that the store couldn't keep up with the swell of holiday shoppers.

NEW YORK (CNNMoney) -- Toys R Us may have bitten off more than it can chew.

Since the beginning of the holiday shopping season, the toy store has unveiled one incentive after another this year, from price matching to layaways to earlier openings than ever on Thanksgiving, to lure in customers. But it seems the retailer may have pushed a little too hard, and has found it hard to keep up with demand.

The retailer's Facebook page is teeming with dozens of customer service complaints after the Black Friday shopping weekend. Many shoppers claimed that they had placed orders to take advantage of some of Toys R Us' hottest deals, only to find out later that they were canceled because there weren't enough items in stock.

"I ordered a train table for my son on Saturday for a price of $39.99. The item was in stock for me to place the order but received an email last night that my order was canceled because the item is no available," Tara Dohn posted. "Had this item not showed in stock for shipping, I would have just gone to the store on Saturday when the sale price was still effective. Now 3 days later, when the sale is over, I'm told I'm out of luck."

Related: Toys R Us shoppers choose deals first, turkey later

Many other shoppers echoed Dohn's sentiment, disappointed that they missed out on Black Friday deals because the retailer couldn't keep up with the traffic.

A spokeswoman for the retailer admitted that the holiday rush caught up with the stores.

"This week is one of the busiest for online shopping across the industry -- and Toysrus.com is no exception," said Toys R Us's Jennifer Albano. "The number of questions to our call center increases proportionately with the increased business."

Toys R Us didn't say if it would offer anything to make up for disappointed customers.

The customer service snafu comes as Toys R Us has been pushing hard to drive customers into its stores and onto its website for their holiday shopping. Stores opened at 8 p.m. on Thanksgiving, making it the earliest retailer, along with Wal-Mart, (WMT, Fortune 500) to offer its doorbuster deals to customers.

It even offered to match online prices from competing stores like Wal-Mart and Amazon (AMZN, Fortune 500), and free layaway plans as early as September for customers who want to reserve a toy online or in stores and pay it off by Christmas time.

It also dabbled in the digital world by launching a kid-friendly tablet and a movie and TV show streaming service geared toward children.

First Published: November 28, 2012: 5:06 PM ET

08.36 | 0 komentar | Read More

SEC closer to taking action against SAC Capital

NEW YORK (CNNMoney) -- The Securities and Exchange Commission is getting closer to taking enforcement against SAC Capital related to the largest insider trading case ever.

SAC Capital, a $14 billion hedge fund run by billionaire Steven A. Cohen, received a Wells notice from the SEC late last week, according to a source familiar with the situation. The SEC issues Wells notices to warn firms that they are likely to bring an action against them.

Cohen and SAC's President Tom Conheeney informed SAC Capital's investors of the Wells notice on a conference call Wednesday morning, according to the source.

A spokesperson for SAC Capital would not comment on the Wells notice or on details of the conference call.

"Mr. Cohen and SAC are confident that they have acted appropriately and will continue to cooperate with the government's inquiry," the SAC spokesperson said.

The SEC also declined to comment about the matter.

Several SAC employees have already been charged with insider trading, including former portfolio manager Mathew Martoma.

Related: Feds pressure Martoma with threat of long sentence

Cohen defended the hedge fund's actions on the conference call, said the source.

Investors did not have the chance to ask follow-up questions on the call, according to the source. SAC currently has no plan to let investors redeem their funds from the hedge fund before the pre-arranged time in the middle of the first quarter of 2013, according to the source.

The SEC has been circling SAC Capital for several years. By charging Martoma in a $276 million alleged insider trading case, the SEC appears to be getting closer to charging Cohen.

Related: a who's who of Steve Cohen's web

The SEC did not specifically name Cohen in its complaint against Martoma but it appeared to indicate that it has its eye on Cohen. The SEC's complaint also referred to the "owner and founder" of the fund in question and said he worked closely with Martoma.

Seven other employees of SAC Capital have been targeted by the SEC and the U.S. Attorney in the past two years.

CNNMoney's Aaron Smith contributed to this story.

First Published: November 28, 2012: 5:24 PM ET

08.36 | 0 komentar | Read More

Treasury declines to brand China a currency manipulator

NEW YORK (CNNMoney) -- The Treasury Department said Tuesday that China's currency remains undervalued, but stopped short of branding the country a currency manipulator.

In its semi-annual report on international exchange rates, the Treasury Department said Chinese authorities "have substantially reduced the level of official intervention in exchange markets" since last year, and have "taken a series of steps to liberalize controls on capital movements."

Critics blame Beijing for holding down the value of its currency, the renminbi, in order to boost China's competitiveness in international trade at the expense of other countries.

Republican presidential candidate Mitt Romney vowed during the campaign to brand China a currency manipulator, a potential step towards trade sanctions. The Obama administration, however, has avoided this designation.

The Treasury Department said in its report Tuesday that the renminbi has appreciated by 12.6% against the dollar when adjusted for inflation since June 2010. Nevertheless, it added that the renminbi "remains significantly undervalued, and further appreciation... against the dollar and other major currencies is warranted."

Treasury said that for China to secure sustainable growth going forward, it needs to increase domestic consumption. Additional renminbi appreciation is a "critical part of this process," the report said, as a stronger currency increases the purchasing power of Chinese households.

The oft-delayed report was originally scheduled to be published last month.

First Published: November 27, 2012: 5:15 PM ET

08.36 | 0 komentar | Read More

Green Mountain jumps 23% on rosy outlook

NEW YORK (CNNMoney) -- Green Mountain Coffee Roasters issued a better than expected outlook for the company's upcoming fiscal year, sending shares up 23% after the closing bell on Tuesday.

The maker of K-cup single-serving coffee drinks said it expects to earn between $2.64 and $2.74 per share in 2013. Analysts had projected full-year earnings between $1.80 and $2.65 per share, according to estimates gathered by Thomson Reuters.

Green Mountain also predicted that net sales growth in the range of 15% to 20%, also topping analysts' expectations.

Shares of Green Mountain (GMCR) jumped $6.78, or 23%, to $35.73 in extended trading.

For the fourth quarter, Green Mountain reported net income of $101 million, or 64 cents per share, up from 75.3 million, or 47 cents per share, in the same period last year. Sales rose 33% in the quarter to $946.7 million.

Green Mountain had stronger-than-expected cash flow in the fourth quarter and expects to have up to $150 million in cash next year, according to chief financial officer Frances Rathke. "We expect to continue to strategically invest in the business as demand warrants," Rathke said in a statement.

Green Mountain's shareholders have been on a wild ride since October 2011, when David Einhorn, the hedge fund manager best known for being one of the first to shed light on the extent of Lehman Brother's troubles, delivered a scathing rebuke of the company's accounting practices.

Following Einhorn's comments, Green Mountain has stumbled, repeatedly missing sales targets in its quarterly earnings. The stock has been heavily shorted and remains well below its 2011 peak, when it traded as high as $108 per share.

Green Mountain recently named Brian Kelley, a former Coca-Cola (CCE, Fortune 500) executive, as its next president and chief executive. Kelly will take over when the current CEO, Lawrence Blanford, steps down next month.

Related: Green Mountain names new CEO

Over the past year, Green Mountain has introduced a host of new products, including most recently an at-home espresso machine.

So far, none of those products have ignited much interest from consumers and the company continues to wrestle with new competition for single serve coffee makers.

Coffee giant Starbucks (SBUX, Fortune 500)became a formidable competitor in March, when it introduced its own Verismo machine.

-- CNNMoney's Maureen Farrell contributed to this report.

First Published: November 27, 2012: 5:42 PM ET

08.36 | 0 komentar | Read More

Tobacco companies ordered to advertise smoking risk

A man smokes a cigarette in San Francisco last year.

NEW YORK (CNNMoney) -- A federal judge ordered the nation's major tobacco companies on Tuesday to take out advertisements acknowledging the health risks of smoking.

The decision stems from a lawsuit federal prosecutors filed back in 1999 alleging that the companies violated racketeering statutes, deceiving the public about the consequences of smoking. The judge ruled against the defendants in a 2006 decision that set out the advertising requirements finalized Tuesday.

The case followed the tobacco industry's landmark $206 billion settlement in 1998.

Related: Asia lights up tobacco giant's sales

The defendants included Philip Morris and its parent, Altria Group (MO, Fortune 500).; R.J. Reynolds Tobacco; Lorillard Tobacco (LO); and British American Tobacco (BTI). The firms were ordered to publish statements on their websites, as well as in ads in newspapers and on television and as inserts in cigarette packaging, acknowledging smoking's consequences. Among other things, the companies must say:

- "Smoking kills, on average, 1,200 Americans. Every day."

- "More people die every year from smoking than from murder, AIDS, suicide, drugs, car crashes, and alcohol, combined."

- "Secondhand smoke kills over 3,000 Americans each year."

Altria spokesman Brian May said the company was "studying the court's decision." Bryan Hatchell, a spokesman for R.J. Reynolds, said his firm, too, was "reviewing the judge's ruling and considering next steps."

The other defendants did not immediately respond to requests for comment or could not be reached for comment late Tuesday.

The companies had argued that some elements of the forced statements violated their First Amendment rights, a claim the judge rejected. The firms were ordered to begin discussions on how to implement the ruling next month, though that timeline could be extended with additional appeals.

First Published: November 27, 2012: 6:57 PM ET

08.36 | 0 komentar | Read More

Troubled broker Knight Capital may be for sale

Knight Capital's shares are down more than 75% following its $440 million trading glitch.

NEW YORK (CNNMoney) -- It hasn't been business as usual for Knight Capital since a massive software glitch in August nearly felled the 15-year old trading firm. Knight Capital is now weighing offers for individual business lines and hasn't ruled out a sale of the entire firm.

According to an email sent by Knight Capital's CEO Thomas Joyce to employees on Saturday that was obtained by CNNMoney, Knight said the company will only consider a sale if the terms are right.

"There is no need for Knight to pursue a partnership, transaction or any other undertaking. We would only move forward with such an initiative if it makes strategic sense for our shareholders and our business," Joyce wrote in the email.

Shares of Knight Capital (KCG) jumped nearly 20% Monday, as investors weighed reports of a potential deal.

Whether or not Knight can finalize a sale, the firm is widely expected to restructure its business in the coming months and cut a large amount of its 1600 employees, according to several analysts.

"Whether someone comes in and buys Knight or if there's a scenario where nothing happens, there has to be a sizeable restructuring of the company to improve the profitability of the business," said Chris Allen, an analyst at Evercore.

Knight could fetch roughly $1.1 billion in a sale, Allen estimates. Nearly all of the value would come from its electronic trading business Hotspot and its market making business.

Knight spokesperson Kara Fitzsimmons declined to comment on a potential sale or layoffs.

Related: Trading plummets at Knight Capital

Knight's institutional stock trading division, which accounts for roughly 41% of Knight's revenues, has been unprofitable in recent years. Potential buyers are expected to dismantle that unit shortly after buying it, analysts said.

And even with Monday's pop, shares of Knight are down 75% in 2012. Following the trading glitch, Knight was forced to launch a frantic bid for capital. A consortium of companies, including TD Ameritrade (AMTD), Blackstone Group (BX), Getco, Stifel Nicolaus, Jefferies Group (JEF) and Stephens, put in $400 million to rescue Knight. In doing so, they diluted the trading firm's existing shareholders.

Knight has been beset by other issues since then. Its trading volume has dropped. Most recently, in the aftermath of Hurricane Sandy, Knight was forced to reroute trades after a power outage knocked out its computer systems.

Knight's newest shareholders are said to have different opinions on how long they want to hold onto their stake in the firm. Allen said that Blackstone and Getco, partially owned by private equity shop General Atlantic, would be more likely to hold onto their investment for the long-term. But Jefferies and TD Ameritrade are more likely to be pushing for a quick sale.

Getco and Virtu are said to have approached Knight about buying the company, according to news reports. Getco declined to comment. Virtu did not return calls for comment.

Blackstone and Jefferies could consider their own offers Knight, according to analysts. Neither firm returned calls for comment.

Knight's competitor Citadel, which made two bids for the company in August, is not expected to put in an offer for the company now, according to a source familiar with the process. Citadel declined to comment.

Related: Knight's costly trading glitch: $440 million

Although Knight is better capitalized now than it was before the trading glitches, investors are still wary.

Michael Wong, an analyst with Morningstar, said that "Knight's excess capital is weighing on its returns." But he pointed out that the company needs that extra cushion to prove to its partners that it is on solid financial footing. Knight could be more valuable as a private company, several analysts said. The company could benefit from not having to disclose as much about its finances.

Joyce's future at the firm is also at stake. His employment agreement only extends through December 31st. Analysts said that if the firm is sold, the new owners would decide whether or not he should remain at the helm in 2013.

First Published: November 26, 2012: 3:49 PM ET

08.37 | 0 komentar | Read More

Google's $400 million Wi-Fi buy a hoax

A press release on PRWeb announcing Google's $400 million purchase of ICOA turned out to be a fake.

NEW YORK (CNNMoney) -- A spate of press reports on Monday heralded Google's latest takeover deal: An apparent $400 million purchase of ICOA, a Warwick, R.I., company that makes Wi-Fi hotspots for public areas like parks and airports.

Not so fast, ICOA executives said soon after. Turns out the press release announcing the deal was a hoax.

The official-looking notice appeared on PRWeb, a distributor of press releases and other corporate announcements. The story was then reported by several news organizations, including the Associated Press, as well as tech blogs, such as TechCrunch.

Then the retractions began pouring in, as ICOA and people familiar with Google's operations began to deny the report. The press release has since been taken down by PRWeb. A representative from the company did not respond to a request for comment. Google (GOOG, Fortune 500) also declined to comment.

"This was a hoax," George Strouthopoulos, CEO of ICOA, told CNNMoney in an e-mail. "This is NOT TRUE!! Never had any discussions with any potential acquirers!! This is absolutely false!"

Strouthopoulos said the company is investigating the source of the fake release, and it plans to report the results to law enforcement.

"Someone, I guess a stock promoter with a dubious interest, is disseminating wrong, false and misleading info in the PR circles," he said.

A quick probe into ICOA's financials would have revealed the fake deal's fishy side. ICOA's total market cap is less than $850,000, and its shares trade for under a penny.

The troubled company once traded on the Nasdaq exchange, but Nasdaq kicked it off after it failed to report its finances on time in three out of eight quarters. ICOA now trades on the so-called "pink sheets," a loosely regulated, over-the-counter marketplace that does not require regular financial reporting or registration with the Securities and Exchange Commission.

Someone moved piles of ICOA's stock on Monday: Nearly 330 million shares changed hands, according to OTCMarkets.com, compared with the stock's usual daily volume of around 2.6 million shares.

ICOA's finances weren't the only suspicious sign. The press release is riddled with grammar and punctuation mistakes, including the clunky, tin-eared line, "Google looks to further diversify it's already impressive portfolio of companies."

On the surface, though, the announcement didn't raise too many eyebrows, because it sounds like the kind of deal Google would make.

The search giant has been heavily investing in Wi-Fi and broadband access. It offers free Wi-Fi service throughout Mountain View, Calif., where the company is based, and has occasionally provided free service in airports or other public locations. It's also in the process of building out a super high-speed broadband Internet and TV network in Kansas City, Kan., as a pilot program.

First Published: November 26, 2012: 3:28 PM ET

08.37 | 0 komentar | Read More

Cyber Monday off to a strong start

Cyber Monday shoppers are flocking to their computers and smartphones to take advantage of discounts at their favorite retailers.

NEW YORK (CNNMoney) -- Cyber Monday is off to a strong start, with shoppers flocking to their computers and smartphones to grab online deals.

By Monday evening, online sales rose nearly 27% from Cyber Monday last year, according to IBM Digital Analytics Benchmark, which tracks more than one million e-commerce transactions per day from more than 500 retailers.

"Cyber Monday is the Super Bowl day of online shopping ... all signs point to that being the case again today," said Jay Henderson, strategy director at IBM Smarter Commerce.

The 27% increase eclipses both the 21% jump in online sales seen on Black Friday and the 17% increase on Thanksgiving day, IBM found. It's also in line with estimates from data tracking firm ComScore, which put sales at $1.5 billion for Cyber Monday -- a 20% rise from the same day last year.

Related: Black Friday: Crowds grow, but sales are a question

Many retailers rolled out earlier online discounts this year, contributing to the strong start to holiday sales.

A growing number of people are also using their mobile devices to make purchases. Nearly a quarter of all online traffic this holiday season has come from consumers using smartphones and tablets, according to IBM. On Cyber Monday, about 20% of shoppers used their mobile devices to look at deals online, and 10% made purchases on their phones or tablets -- up from 12% and 7% last year.

Cyber Monday traditionally refers to the Monday following Black Friday and is typically the day many retailers offer online-only deals. This year many companies didn't wait for Monday and instead began rolling out their online discounts on Thanksgiving or earlier.

Related: 7 apps to find holiday deals

The retailers that popped up as most-frequently searched by users on Cyber Monday include Walmart (WMT, Fortune 500), Best Buy (BBY, Fortune 500), Amazon (AMZN, Fortune 500), Sears (SHLD, Fortune 500) and Target (TGT, Fortune 500). The products that were searched the most online were Amazon's Kindle and Kindle Fire, Uggs, iPads, the iPod Touch, Legos and the Wii, according to Experian Marketing Services.

This year, online sales have outpaced in-store sales. Retail sales at stores on Black Friday declined nearly 2%, according to ShopperTrak, while online sales posted double-digit growth.

-- CNNMoney's Laurie Segall contributed to this report

First Published: November 26, 2012: 4:58 PM ET

08.37 | 0 komentar | Read More

Black Friday: Crowds grow, but sales are a question

Lots of holiday shoppers hit the stores, such as Toys R Us in New York's Times Square, on Thanksgiving night.

NEW YORK (CNNMoney) -- There were more shoppers in the nation's malls and big-box stores on Black Friday than there were last year, according to a report issued Saturday. But retailers still aren't sure that starting the holiday shopping season on Thanksgiving night proved successful.

ShopperTrak, which measures and analyzes foot traffic at more than 50,000 retail locations nationwide, says Black Friday store visits climbed 3.5% from last year to more than 307.67 million.

But Black Friday retail sales fell 1.8% to $11.2 billion, the firm said.

"While foot traffic did increase on Friday, those Thursday deals attracted some of the spending that's usually meant for Friday," said Bill Martin, ShopperTrak's founder, in a statement.

ShopperTrak said foot traffic rose in most of the nation except for the West, where it was down more than 11%.

"Black Friday shopping continues to expand into Thanksgiving Day and will impact the way we look at all of the 'Black' weekend results, since more shopping hours allows for more shopping visits and a smoothing of sales across all of the days," said Martin.

Shoppers took advantage of early Thanksgiving night openings by retailers such as Wal-Mart (WMT, Fortune 500), Target (TGT, Fortune 500), Sears (SHLD, Fortune 500) and Toys R Us.

Related: Black Friday shoppers out in full force

"By opening even earlier, the retailers have been able to attract a broader spectrum of consumers to participate in Black Friday -- not everyone is willing to wake up at 4 a.m.," said Marshal Cohen, chief industry analyst at the NPD Group. "They definitely got a lot more business early and upfront."

Shoppers started lining up at the Sears at North Point Mall in Alpharetta, Ga., around 6:30 p.m. on Thursday, and by the time the retailer opened, there was a crowd of about 500 people, said Nick Nicolosi, the mall's general manager. When the clock struck midnight and other stores opened, Nicolosi estimated that about 5,000 people were waiting to storm the stores -- the biggest Black Friday crowd North Point has seen since it began hosting its Rockin Shoppin Eve event five years ago.

La Plaza Mall in McAllen, Texas, had to use its off-duty police officers and security to control traffic outside of stores.

"Many stores including Abercrombie & Fitch (ANF) had to close their store entrances temporarily as they had reached capacity with hundreds of shoppers waiting to enter the stores," said Isabel Rodriguez-Vera, area director of marketing.

Related: Cyber Monday is already here

Not everyone was willing to wait in line. Online sales soared over the two-day shopping period, climbing more than 17% from last year on Thanksgiving and nearly 21% on Black Friday, according to IBM Benchmark. Sales made from mobile devices grew by nearly two-thirds over 2011.

A long list of online retailers -- including Wal-Mart, Amazon (AMZN, Fortune 500), Best Buy (BBY, Fortune 500) and The Disney Store -- unveiled "pre-Black Friday deals" even before Thanksgiving.

"We've absolutely seen this whole weekend turn into one big promotional event," said Jay Henderson, strategy director for IBM Smarter Commerce. "Black Friday deals are no longer just for the [brick-and-mortar] store, and Cyber Monday deals are no longer just for Monday."

However, the initial surge is likely to be temporary. By Sunday morning, Cohen expects shopper traffic to fall back to normal pre-holiday sales levels. "There are more hours to shop, but consumers don't have more relatives or more money in their pocket, so once all the dust settles, we won't see too much growth overall," he said.

Julianne Pepitone and Hibah Yousuf contributed to this article.

First Published: November 24, 2012: 6:12 PM ET

08.37 | 0 komentar | Read More

Stocks: Focus back on U.S. economy

Click the chart for more stock market data

NEW YORK (CNNMoney) -- As confidence builds over lawmakers' ability to reach a deal on the "fiscal cliff," investors will turn their attention to U.S. economic reports on the housing market, manufacturing and consumer data this week.

"The U.S. stock market has recovered a little from its post-election hangover, as expectations of a compromise over the fiscal cliff have grown," said John Higgins, senior markets economist at Capital Economics.

Last week, the Dow Jones Industrial Average, the S&P 500 and the Nasdaq ended the week up more than 3%, racking up five straight days of gains. The Dow closed above 13,000 for the first time since the election.

Two broad measures of the U.S. economy are due out this week. The first comes on Wednesday, when the Federal Reserve releases its latest snapshot of economic conditions across its 12 districts. Last month, the Beige Book showed that economic activity had expanded at a modest pace.

Related: Fear & Greed Index

An estimate of the nation's gross domestic product, the broadest measure of the nation's economic health, is due out on Thursday. A first estimate, released in October, showed the economy had grown at a 2% rate, thanks to an increase in defense spending, an improving housing sector and stronger consumer spending.

This week, investors also get a feel for the pulse of the American consumer, a key gauge during this time of the year, when retailers are in the midst of the holiday shopping season. Consumer spending drives about 70% of the U.S. economy and in play this week are consumer confidence, personal income and spending numbers.

Last month, consumer confidence rose to its highest level in four years, boosted by improvements in the job market.

Economists are expecting reports on the housing markets to boost markets again this week. Investors will have data to digest on housing prices from the Case-Shiller 20-city index, mortgage rates, and pending home sales.

The housing market has been a bright spot in an otherwise slowly recovering economy. In the last month, existing home sales, home prices and new construction showed upticks. The nation's extremely favorable mortgage rates also sank even lower last week, setting records for both the 30-year and 15-year fixed rate loans.

Investors will also get a look at U.S. manufacturing this week from reports on durable orders and the Chicago purchasing managers index.

Global manufacturing data has shown a mixed picture this month. China's manufacturing industry exhibited signs of improvement in November. But a report last week showed that the European manufacturing sector was contracting, and eurozone service industry companies are more pessimistic about their prospects than at any time since early 2009.

First Published: November 25, 2012: 11:52 AM ET

08.37 | 0 komentar | Read More

Black Friday shopping hits a new record

Total spending over Black Friday weekend hit a record $59.1 billion, up from $52.4 billion last year. The number of shoppers in store and online also hit a new record.

NEW YORK (CNNMoney) -- Apparently, full stomachs after Thanksgiving dinners get people in the mood for some real shopping.

Customers flocked in to early store openings on Thanksgiving day to scoop up "doorbuster" deals. A record 247 million shoppers visited stores and websites in the post-Thanksgiving Black Friday weekend this year, up 9% from 226 million last year, according to a survey by the National Retail Federation released Sunday.

Individual shoppers also shelled out more money -- spending $423 this weekend, up from $398 last year. Total spending over the four-day weekend reached a record $59.1 billion, a 13% increase from $52.4 billion last year, according to the NRF.

The survey found that retailers' push to open stores earlier appealed to customers. Stores like Wal-Mart (WMT, Fortune 500), Toys R Us, Sears (SHLD, Fortune 500) and Target (TGT, Fortune 500), that ushered in customers just as Thanksgiving meals wrapped up, saw a boost. About 10% of this weekend's shoppers were out at stores by 8 p.m. on Thursday and an estimated 28% of weekend shoppers were at the stores by midnight, compared to 24.4% last year.

"The only way to describe the Thanksgiving openings is to call them a huge win," said NRF President and CEO Matthew Shay. "Thanksgiving shopping has really becoming an extension of the day's activities. Whole families are going."

Related: Black Friday shoppers out in full force

In a separate survey, ShopperTrak found that the number of people shopping in stores climbed 3.5% from last year to more than 307.67 million.

Bill Martin, ShopperTrak's founder, said that traffic hasn't been this high since 2006. He said that the return to pre-recession levels indicates a real recovery in consumer behavior.

"We've seen that consumers are willing to shop a few extra stores," Martin said. "This could translate into more impulse buying and stronger sales."

But not everyone wanted to wait in line. Online sales soared more than 17% on the Thursday of Thanksgiving, followed by a nearly 21% increase on Friday over last year, according to IBM Benchmark. Sales made from mobile devices climbed by 16%, with more than 24% of consumers using mobile devices to visit a retailer's website.

The NRF had predicted that looming fears over the "fiscal cliff" and the struggling jobs market could weigh on holiday spending. That's why it estimated that holiday sales will rise by 4.1%, which is slower than the 5.6% increase last year.

Shay said that between 65% and 80% of shoppers factor overall economic conditions into holiday spending decisions. Its survey found that two thirds of shoppers will pay with cash or debit, highlighting people's aversion to taking on too much debt in a still slow-recovering economy.

But retailers are hopeful that these strong Black Friday figures set a tone for a solid season of spending ahead. The Thanksgiving shopping tradition kicks off the holiday season sales blitz, wherein stores can make up to 40% of their annual sales in the November-December period.

"A single day doesn't make up a holiday season, but if you don't start off well on that day, you have trouble catching up," Martin said.

First Published: November 25, 2012: 2:37 PM ET

08.36 | 0 komentar | Read More

Wal-Mart protests draw hundreds nationwide

NEW YORK (CNNMoney) -- Hundreds of people -- including some employees -- have taken part in Black Friday demonstrations at Wal-Mart stores nationwide, protesting what they say is the retailer's retaliation against speaking out for better pay, fair schedules and affordable health care.

According to organizers from the union-backed group OUR Walmart, hundreds of workers and thousands of supporters rallied across 100 cities, including Landover Hills, Md., Miami, Oakland, Calif., Chicago, Danville, Ky., Dallas and Kenosha, Wis.

Wal-Mart pushed back, saying it knew of only a "few dozen" protests, and that most of the protesters were not its employees

In one of the biggest protests, nine people were arrested outside of a Paramount, Calif., Wal-Mart store for failing to disperse, according to a Los Angeles County Sheriff's Department statement. An OUR Walmart spokesman said three of those arrested were Wal-Mart workers. Those arrested were to be released without bail, unless they had previous arrest warrants.

The sheriff's department said about 1,000 people arrived by bus and private vehicles to participate in the Paramount protest, which was characterized as peaceful.

In Landover Hills, near Washington. D.C. ,organizers said about 350 people participated, although video of the event showed around 100 participants. Dawn Le, who works for the United Food and Commercial Workers Union, which backs OUR Walmart, would not say how many of those taking part were Wal-Mart employees.

Wal-Mart (WMT, Fortune 500), in a statement late Friday, said worker absenteeism was down more than 60% from last year.

"We had our best Black Friday ever and OUR Walmart was unable to recruit more than a small number of associates to participate in these made for TV events," said David Tovar, vice president of corporate communications, in the statement. "Press reports are now exposing what we have said all along -- the large majority of protesters aren't even Walmart workers."

Janna Pea, an OUR Wal-Mart organizer in Dallas, said about 40 workers and about 150 supporters took part in a protest Thursday night.

One of those with her was Josue Mata, who says he walked off his job as an overnight maintenance employee to protest retaliation against people who want to speak out.

"I have four kids and I don't want them to grown up in a society where people disrespect them," he said. "This is a never-ending fight and we're never going to stop."

Related: Wal-Mart: Crowded, and not everyone is smiling.

Mata said he plans to return to work for his next scheduled shift on Sunday evening.

Pea said her protesters went to four Wal-Mart stores across the Dallas area, and while they were able to picket and speak to customers at half of them, they were asked to leave immediately by police at the others.

"We were still able to talk to customers and educate them about what was going on," she said. "We saw one person who was planning to go shopping, but then didn't end up going in. Instead, they rallied with us."

Muhammed Malik, who helped organize a protest at a Miami Wal-Mart, said roughly 70 workers participated in their hour-long demonstration Thursday night. He said one worker walked off his shift as he saw others rallying outside.

Wal-Mart has denied that it has retaliated against protesting workers, and said Friday that it has offered special holiday discounts to its employees for their efforts this season.

The protests were limited in scope, occurring at a handful of the company's approximately 4,000 U.S. stores. One employee at a store near Pittsburgh told CNNMoney he had heard of the protests only through the media.

Related: Black Friday shoppers out in full force

In an effort to stop the protests, Wal-Mart filed a complaint last week with the National Labor Relations Board, claiming that the demonstrations violated labor laws.

The retailer said the actions have disrupted business, and that the workers' ongoing actions violate the National Labor Relations Act, which prohibits picketing for any period over 30 days without filing a petition to form a union.

On Tuesday, OUR Walmart filed its own charge with the federal agency, claiming that Wal-Mart tried to deter workers from participating in the protests and interfered with their right to speak up.

But the NLRB was not able to rule in time or issue an injunction. Nancy Cleeland, a spokeswoman for the NLRB, said the complaint is too complex to make a ruling so soon.

Despite the talk of the protests, Wal-Mart reported larger Thanksgiving and Black Friday crowds than last year. As of Friday morning, the company said it had processed nearly 10 million register transactions.

Shares of Wal-Mart rose 1.9% in Friday trading.

First Published: November 23, 2012: 11:48 AM ET

08.36 | 0 komentar | Read More

Cyber Monday starts early this year

NEW YORK (CNNMoney) -- Post-Thanksgiving online discounts were once relegated to Cyber Monday -- but these days, websites are launching deals even before Black Friday. And the resulting shopping frenzy is expected to set records.

IBM Benchmark reported total online sales for Black Friday were up nearly 21% from last year. On Thanksgiving, sales rose more than 17% compared to 2011. Black Friday was the stronger of the two days, eclipsing Thanksgiving by 4:10 p.m. ET.

And a long list of retailers -- including Wal-Mart (WMT, Fortune 500), Amazon (AMZN, Fortune 500), Best Buy (BBY, Fortune 500) and Ann Taylor (ANN) -- unveiled "pre-Black Friday deals" even before Thanksgiving. Apple (AAPL, Fortune 500) posted its one-day online shopping discounts on Black Friday, as did beauty brand MAC Cosmetics.

"We've absolutely seen this whole weekend turn into one big promotional event," said Jay Henderson, strategy director for IBM Smarter Commerce. "Black Friday deals are no longer just for the [brick-and-mortar] store, and Cyber Monday deals are no longer just for Monday."

Related: 7 apps for holiday deals

Cyber Monday's original appeal, as the first weekday after Thanksgiving, was access to quick Internet speeds while at work. But now broadband at home is ubiquitous, and consumers can also shop on a slew of mobile devices.

And so retailers' online deals stretch well ahead of Cyber Monday -- in some cases, nearly a full week before.

"Retailers are trying to draw consumers in earlier, and one way to do that is to stagger the deals: Pre-Thanksgiving, some on Thanksgiving Day, another set over the weekend, and finally the big bang to close it out on Cyber Monday," Henderson said.

Mobile devices have become increasingly important during that week before Cyber Monday. The number of consumers using their mobile device to make a purchase on Black Friday this year increased by nearly two-thirds from 2011, IBM data show.

Apple's iPad made up nearly 10% of online shopping traffic on Black Friday this year, according to IBM, while the iPhone brought in almost 9% and Android devices comprised 5.5%.

And IBM said shoppers are taking advantage of the technology to find better deals. Despite spending more overall, the average online order fell 4.7% to $181.22, and the number of items in each order decreased 12% to 5.6.

Retailers are taking note. Companies like Macy's (M, Fortune 500) and Target (TGT, Fortune 500) developed special Black Friday mobile apps featuring exclusive deals and store maps.

Still, despite the expanded schedule, Cyber Monday itself remains an important part of the holiday shopping season.

Related: Holiday shopping forecast: Stronger, and predictably crazy

Andrew Lipsman, an industry analyst at data tracking firm ComScore, said he expects sales for the one-day Cyber Monday shopping event to be around $1.5 billion this year. That's up from his calculations of $1.3 billion in 2011.

It will be a few weeks before full details on Thanksgiving week's sales are made clear, but last year both Black Friday and Cyber Monday broke records. Total spending over the four-day weekend after Thanksgiving 2011 reached a record $52.4 billion, according to the National Retail Federation.

Black Friday 2012 was shaping up to be robust, with shoppers turning out even on Thanksgiving Day at stores including Toys R Us and Sears (SHLD, Fortune 500).

First Published: November 23, 2012: 12:08 PM ET

08.36 | 0 komentar | Read More

Black Friday: Crowds grow, but sales are a question

Lots of holiday shoppers hit the stores, such as Toys R Us in New York's Times Square, on Thanksgiving night.

NEW YORK (CNNMoney) -- There were more shoppers in the nation's malls and big-box stores on Black Friday than there were last year, according to a report issued Saturday. But retailers still aren't sure that starting the holiday shopping season on Thanksgiving night proved successful.

ShopperTrak, which measures and analyzes foot traffic at more than 50,000 retail locations nationwide, says Black Friday store visits climbed 3.5% from last year to more than 307.67 million.

But Black Friday retail sales fell 1.8% to $11.2 billion, the firm said.

"While foot traffic did increase on Friday, those Thursday deals attracted some of the spending that's usually meant for Friday," said Bill Martin, ShopperTrak's founder, in a statement.

ShopperTrak said foot traffic rose in most of the nation except for the West, where it was down more than 11%.

"Black Friday shopping continues to expand into Thanksgiving Day and will impact the way we look at all of the 'Black' weekend results, since more shopping hours allows for more shopping visits and a smoothing of sales across all of the days," said Martin.

Shoppers took advantage of early Thanksgiving night openings by retailers such as Wal-Mart (WMT, Fortune 500), Target (TGT, Fortune 500), Sears (SHLD, Fortune 500) and Toys R Us.

Related: Black Friday shoppers out in full force

"By opening even earlier, the retailers have been able to attract a broader spectrum of consumers to participate in Black Friday -- not everyone is willing to wake up at 4 a.m.," said Marshal Cohen, chief industry analyst at the NPD Group. "They definitely got a lot more business early and upfront."

Shoppers started lining up at the Sears at North Point Mall in Alpharetta, Ga., around 6:30 p.m. on Thursday, and by the time the retailer opened, there was a crowd of about 500 people, said Nick Nicolosi, the mall's general manager. When the clock struck midnight and other stores opened, Nicolosi estimated that about 5,000 people were waiting to storm the stores -- the biggest Black Friday crowd North Point has seen since it began hosting its Rockin Shoppin Eve event five years ago.

La Plaza Mall in McAllen, Texas, had to use its off-duty police officers and security to control traffic outside of stores.

"Many stores including Abercrombie & Fitch (ANF) had to close their store entrances temporarily as they had reached capacity with hundreds of shoppers waiting to enter the stores," said Isabel Rodriguez-Vera, area director of marketing.

Related: Cyber Monday is already here

Not everyone was willing to wait in line. Online sales soared over the two-day shopping period, climbing more than 17% from last year on Thanksgiving and nearly 21% on Black Friday, according to IBM Benchmark. Sales made from mobile devices grew by nearly two-thirds over 2011.

A long list of online retailers -- including Wal-Mart, Amazon (AMZN, Fortune 500), Best Buy (BBY, Fortune 500) and The Disney Store -- unveiled "pre-Black Friday deals" even before Thanksgiving.

"We've absolutely seen this whole weekend turn into one big promotional event," said Jay Henderson, strategy director for IBM Smarter Commerce. "Black Friday deals are no longer just for the [brick-and-mortar] store, and Cyber Monday deals are no longer just for Monday."

However, the initial surge is likely to be temporary. By Sunday morning, Cohen expects shopper traffic to fall back to normal pre-holiday sales levels. "There are more hours to shop, but consumers don't have more relatives or more money in their pocket, so once all the dust settles, we won't see too much growth overall," he said.

Julianne Pepitone and Hibah Yousuf contributed to this article.

First Published: November 24, 2012: 6:12 PM ET

08.36 | 0 komentar | Read More

RIM jumps 14% on BlackBerry 10 hopes

RIM, and CEO Thorsten Heins, have spent months assuring that BlackBerry 10 is worth the wait -- and investors appear optimistic.

NEW YORK (CNNMoney) -- Hating BlackBerry has become something of a bloodsport, but Research in Motion shares have been on an incredible tear for the past two months -- and the RIM rally continued Friday after a bullish analyst report.

National Bank Financial analyst Kris Thompson upped his price target on the stock and his predictions for product shipments in 2014. RIM (RIMM) shares closed 14% higher Friday as a result.

Last week, RIM announced that its long-delayed BlackBerry 10 operating system will finally debut on January 30, a year after the company's next-generation smartphones and software were slated to go on sale.

RIM initially said its new BlackBerry 10 software and devices would be available at the beginning of 2012. The company first delayed that to the end of 2012, and then again to the beginning of 2013.

The new operating system is meant to be the crown jewel of the company's turnaround, so the delays were incredibly troublesome. Some critics wondered if RIM would even survive long enough to launch BlackBerry 10.

Related story: RIM's fate hangs on BlackBerry 10

RIM CEO Thorsten Heins has spent the past few months assuring naysayers that the software will launch in early 2013, and that it will be worth the wait.

Investors appear to be growing more optimistic as well. RIM shares have gained an astounding 59% over the past two months.

That jump is even more remarkable when compared with the slump Apple (AAPL, Fortune 500) suffered in the same two-month period. The smartphone king hit bear-market status this month, falling to an intra-day low of about $506 last Friday -- down nearly $200 from the all-time high it hit on September 21.

The Apple sell-off comes after an incredible runup over the past few years -- and during a tumultuous time in the broader stock market on concerns about the fiscal cliff and Europe's continued debt crisis.

First Published: November 23, 2012: 9:56 AM ET

08.36 | 0 komentar | Read More

Wal-Mart protests draw hundreds nationwide

NEW YORK (CNNMoney) -- Hundreds of people -- including some employees -- have taken part in Black Friday demonstrations at Wal-Mart stores nationwide, protesting what they say is the retailer's retaliation against speaking out for better pay, fair schedules and affordable health care.

According to organizers from the union-backed group OUR Walmart, hundreds of workers and thousands of supporters rallied across 100 cities, including Landover Hills, Md., Miami, Oakland, Calif., Chicago, Danville, Ky., Dallas and Kenosha, Wis.

In one of the biggest protests, nine people were arrested outside of a Paramount, Calif., Wal-Mart store for failing to disperse, according to a Los Angeles County Sheriff's Department statement. An OUR Walmart spokesman said three of those arrested were Wal-Mart workers. Those arrested were to be released without bail, unless they had previous arrest warrants.

The sheriff's department said about 1,000 people arrived by bus and private vehicles to participate in the Paramount protest, which was characterized as peaceful.

In Landover Hills, near Washington. D.C. ,organizers said about 350 people participated, although video of the event showed around 100 participants. Dawn Le, who works for the United Food and Commercial Workers Union, which backs OUR Walmart, would not say how many of those taking part were Wal-Mart employees.

Wal-Mart (WMT, Fortune 500), in a statement, said there were 26 protests Thursday night, when its stores opened at 8 p.m. to begin Black Friday. It estimated that fewer than 50 Wal-Mart workers participated, and that many of the protests involved no employees at all.

Janna Pea, an OUR Wal-Mart organizer in Dallas, said about 40 workers and about 150 supporters took part in a protest Thursday night.

One of those with her was Josue Mata, who says he walked off his job as an overnight maintenance employee to protest retaliation against people who want to speak out.

"I have four kids and I don't want them to grown up in a society where people disrespect them," he said. "This is a never-ending fight and we're never going to stop."

Related: Wal-Mart: Crowded, and not everyone is smiling.

Mata said he plans to return to work for his next scheduled shift on Sunday evening.

Pea said her protesters went to four Wal-Mart stores across the Dallas area, and while they were able to picket and speak to customers at half of them, they were asked to leave immediately by police at the others.

"We were still able to talk to customers and educate them about what was going on," she said. "We saw one person who was planning to go shopping, but then didn't end up going in. Instead, they rallied with us."

Muhammed Malik, who helped organize a protest at a Miami Wal-Mart, said roughly 70 workers participated in their hour-long demonstration Thursday night. He said one worker walked off his shift as he saw others rallying outside.

Wal-Mart did not immediately respond for comment on OUR Walmart's participation estimates. The company has denied that it has retaliated against protesting workers, and said Friday that it has offered special holiday discounts to its employees for their efforts this season.

The protests were limited in scope, occurring at a handful of the company's approximately 4,000 U.S. stores. One employee at a store near Pittsburgh told CNNMoney he had heard of the protests only through the media.

Related: Black Friday shoppers out in full force

In an effort to stop the protests, Wal-Mart filed a complaint last week with the National Labor Relations Board, claiming that the demonstrations violated labor laws.

The retailer said the actions have disrupted business, and that the workers' ongoing actions violate the National Labor Relations Act, which prohibits picketing for any period over 30 days without filing a petition to form a union.

On Tuesday, OUR Walmart filed its own charge with the federal agency, claiming that Wal-Mart tried to deter workers from participating in the protests and interfered with their right to speak up.

But the NLRB was not able to rule in time or issue an injunction. Nancy Cleeland, a spokeswoman for the NLRB, said the complaint is too complex to make a ruling so soon.

Despite the talk of the protests, Wal-Mart reported larger Thanksgiving and Black Friday crowds than last year. As of Friday morning, the company said it had processed nearly 10 million register transactions.

Shares of Wal-Mart rose 1.9% in Friday trading.

First Published: November 23, 2012: 11:48 AM ET

08.36 | 0 komentar | Read More

Cyber Monday starts early this year

NEW YORK (CNNMoney) -- Post-Thanksgiving online discounts were once relegated to Cyber Monday -- but these days, websites are launching deals even before Black Friday. And the resulting shopping frenzy is expected to set records.

IBM Benchmark reported total online sales for Thanksgiving rose more than 17% compared to 2011. For Black Friday, IBM Benchmark indicated that online sales were up nearly 23% from last year, as of 6 p.m. ET.

And a long list of retailers -- including Wal-Mart (WMT, Fortune 500), Amazon (AMZN, Fortune 500), Best Buy (BBY, Fortune 500) and Ann Taylor (ANN) -- unveiled "pre-Black Friday deals" even before Thanksgiving. Apple (AAPL, Fortune 500) posted its one-day online shopping discounts on Black Friday, as did beauty brand MAC Cosmetics.

"We've absolutely seen this whole weekend turn into one big promotional event," said Jay Henderson, strategy director for IBM Smarter Commerce. "Black Friday deals are no longer just for the [brick-and-mortar] store, and Cyber Monday deals are no longer just for Monday."

Related: 7 apps for holiday deals

Cyber Monday's original appeal, as the first weekday after Thanksgiving, was access to quick Internet speeds while at work. But now broadband at home is ubiquitous, and consumers can also shop on a slew of mobile devices.

And so retailers' online deals stretch well ahead of Cyber Monday -- in some cases, nearly a full week before.

"Retailers are trying to draw consumers in earlier, and one way to do that is to stagger the deals: Pre-Thanksgiving, some on Thanksgiving Day, another set over the weekend, and finally the big bang to close it out on Cyber Monday," Henderson said.

Mobile devices have become increasingly important during that week before Cyber Monday. The number of consumers using their mobile device to make a purchase on Thanksgiving this year increased 66% from 2011, IBM data show.

Apple's iPad made up nearly 11% of online shopping traffic on Thanksgiving this year, according to IBM, while the iPhone brought in 9%.

Retailers are taking note. Companies like Macy's (M, Fortune 500) and Target (TGT, Fortune 500) developed special Black Friday mobile apps featuring exclusive deals and store maps.

Still, despite the expanded schedule, Cyber Monday itself remains an important part of the holiday shopping season.

Related: Holiday shopping forecast: Stronger, and predictably crazy

Andrew Lipsman, an industry analyst at data tracking firm ComScore, said he expects sales for the one-day Cyber Monday shopping event to be around $1.5 billion this year. That's up from his calculations of $1.3 billion in 2011.

It will be a few weeks before full details on Thanksgiving week's sales are made clear, but last year both Black Friday and Cyber Monday broke records. Total spending over the four-day weekend after Thanksgiving 2011 reached a record $52.4 billion, according to the National Retail Federation.

Black Friday 2012 was shaping up to be robust, with shoppers turning out even on Thanksgiving Day at stores including Toys R Us and Sears (SHLD, Fortune 500).

First Published: November 23, 2012: 12:08 PM ET

08.36 | 0 komentar | Read More

Wal-mart workers get ready for Black Friday protest

Wal-Mart employees in June joined a rally in Los Angeles to protest what they call retaliation from the nation's largest retailer.

NEW YORK (CNNMoney) -- Shoppers and stores around the country are preparing for big Black Friday sales, but a group of Wal-Mart (WMT, Fortune 500) workers are getting ready for a protest.

"I'll do whatever it takes to speak out about our concerns -- I'm willing to put my job on the line," says Monique Velasquez, a single mother of five who works in Wal-Mart's photo department in Pico Rivera, California. Velasquez plans to join the protest on Friday.

The union-backed group OUR Walmart, which has helped organize the post-Thanksgiving walk-out, expects thousands of workers around the country to participate. Workers say they are joining the protest to ask the country's largest employer to end what they call retaliation against speaking out for better pay, fair schedules and affordable health care.

In an effort to stop the workers from protesting, Wal-Mart filed a complaint last week with the National Labor Relations Board, claiming that the protesters violated labor laws.

The federal labor agency, which was under pressure to act within 72 hours of getting the complaint, has said that it is "highly unlikely" to have a ruling on the complaint in time to stop the Black Friday protests. Nancy Cleeland, a spokeswoman for the NLRB said the complaint is too complex to make a ruling so soon.

Wal-Mart's complaint claimed that the United Food and Commercial Workers Union and its subsidiary OUR Walmart unlawfully organized picket lines and other demonstrations in the past six months. The retailer said the actions have disrupted business, and that the workers' ongoing actions violate the National Labor Relations Act, which prohibits picketing for any period over 30 days without filing a petition to form a union.

On Tuesday, OUR Walmart filed its own charge with the federal agency, claiming that Wal-Mart tried to deter workers from participating in the protests and interfered with their right to speak up.

The labor agency's Cleeland said that if it finds that Wal-Mart's claims have merit, it will go to court to seek an injunction on behalf of the retailer to stop the union-backed group from organizing the protests.

If the agency doesn't find merit, the charge will be dismissed or withdrawn, she said.

Labor law experts say that Wal-Mart could have a tough time winning this one. That's because the labor laws that prohibit picketing over 30 days applies only to protesters trying to form a union or gain collective bargaining rights, not employees who are protesting against retaliation.

If the employees' claims are true, Wal-Mart could itself be found in violation of the National Labor Rights Act, which protects workers against retaliation for speaking up, according to Angela Cornell, director of the Labor Law Clinic at Cornell University's law school.

For its part, Wal-Mart plans to go full steam ahead on Black Friday. It will start doling out its "doorbuster" deals at 8 p.m. on Thursday, just after shoppers finish their Thanksgiving feasts.

Related: Wal-Mart Black Friday deals

The retailer is offering special deals to customers who are in line inside its stores at 10 p.m., guaranteeing three special offers -- the Apple iPad2, an Emerson 32 inch TV and an LG Blu-ray player.

On Monday, the retailer tweeted: "Don't believe everything you read in the union press releases. We don't think their #BlackFriday activity will have an impact on customers."

OUR Wal-Mart, meanwhile, has more than 30,000 "likes" on its Facebook page, and has collected more than $60,000 in donations to support workers who walk off work in protest on Black Friday.

First Published: November 22, 2012: 12:06 AM ET

08.37 | 0 komentar | Read More

Fitch cuts Sony, Panasonic debt to junk

Sony and Panasonic were downgraded Thursday by Fitch.

HONG KONG (CNNMoney) -- Fitch Ratings downgraded Sony and Panasonic debt to junk status Thursday and said the ailing Japan-based consumer electronic makers both needed radical restructuring to improve their prospects.

Panasonic's rating was cut to BB from BBB-, while Sony was moved to BB- from BBB-, with a negative outlook. Both companies now carry speculative, or junk, ratings.

The downgrades are the latest in a string for Sony and Panasonic, which have been haemorrhaging money and struggling to find positive momentum.

The companies, once the crown jewels of the high-tech Japanese economy, have been hit in recent years by a strong yen and weak demand for televisions. Sony now has a market cap of just more than $10 billion, and hasn't turned a profit in four years.

Its shares are trading near their lowest levels in three decades, and even closed below the 800 yen mark in Tokyo earlier this month.

"We think there is little headroom for Sony," Fitch's Steve Durose said in a statement.

"Without a radical change to the structure of their businesses it is difficult to see profitability improving enough for [Sony and Panasonic] to regain investment-grade ratings," Durose said.

Related: Something is rotten in Japan

Panasonic seems to be in better shape than Sony, and less dependent on its struggling core electronics business. Sony is the subject of frequent speculation as a possible takeover target, with cash-rich competitors like Apple, Google and Microsoft all reported as possible suitors.

Related: Can Sony be saved?

Sony made a play of its own in recent months, taking a stake in Olympus, the scandal-plagued company embroiled in an epic accounting fraud. But analysts remain skeptical that Sony will be able to achieve a long-term turnaround.

"The future of both companies will depend on their ability to curb loss-making segments and rediscover the kind of technological leadership which historically enabled them to develop must-have products," Durose said.

First Published: November 22, 2012: 5:39 AM ET

08.37 | 0 komentar | Read More

Service sector adds to eurozone gloom

Germany's services sector is increasingly gloomy about its prospects

LONDON (CNNMoney) -- Service industry companies in the eurozone are more pessimistic about their prospects than at any time since early 2009, pointing to little chance of a return to growth for the region soon, according to business surveys published Thursday.

Preliminary data showed the weakest reading for service sector activity in 40 months, and expectations for the year ahead were at their lowest since March 2009. Sentiment in Germany, Europe's biggest economy, fell particularly sharply.

Markit's composite purchasing managers' index (PMI) for November stood little changed at 45.8, compared with 45.7 in October.

A fall in the services PMI to 45.7 from 46 was partly offset by a slower rate of decline in manufacturing. Any reading below 50 signals contraction. Markit said the surveys pointed to contraction of 0.5% in the eurozone economy in the fourth quarter.

Eurozone gross domestic product shrank by 0.2% in the second quarter, and 0.1% in the third, leaving the 17-nation currency area stuck in recession.

Related: Eurozone risks rising as outlook darkens

"While it is reassuring to have seen signs of stabilization in some survey indicators, the overall rate of decline remains severe and has spread to encompass Germany, suggesting the situation could deteriorate further in the coming months," Markit chief economist Chris Williamson said.

Jobs were being shed at their second-fastest rate since January 2010 as companies become increasingly anxious about the economic outlook and seek to keep costs under control.

"All this suggests that any swift return to growth is unlikely," Williamson said.

Germany saw divergent trends in November, with manufacturing registering a slower drop in output compared with October, and new export orders declining at their lowest rate for six months helped by stronger demand from China.

The overall German PMI reading stood at 47.9, up from 47.7 in October. But the German services sector saw its fastest contraction since June 2009, and the outlook remains bleak.

"The survey panel noted widespread worries that client budgets will be cut in 2013, alongside expectations that the euro area crisis will further undermine the German recovery," said Markit senior economist Tim Moore.

The European Commission forecasts growth of 0.1% for the eurozone in 2013, but with more spending cuts and tax rises to come in countries such as France, Italy and Spain, and the prolonged wrangling over Greece's bailout holding back sentiment, many private forecasters are predicting another year of recession.

PMI data for France, which was stripped of its AAA credit rating Monday by Moody's, showed a mirror image to Germany, with manufacturing continuing to contract at a sharp pace while services sector firms reported a more moderate fall in output than October.

Still, the overall French PMI reading of 44.6, up from 43.5 in October, continues to reflect a marked rate of decline for Europe's second biggest economy, and was the ninth consecutive month of contraction.

Related: No deal for Greece as talks drag

A prolonged recession in 2013 would undermine many of the assumptions underpinning eurozone government budgets and bailout programs, and could lead to another flare up in the sovereign debt crisis if borrowing needs rise and investors lose faith in the ability of the region to chart a path back to growth.

Bond yields for some of the eurozone's more vulnerable states held steady Thursday, but have risen from lows posted in the wake of the European Central Bank's announcement in September that it was ready to buy bonds of eurozone nations if they signed up for formal bailout programs.

Markit said forward-looking indicators in the manufacturing sector also pointed to continuing weakness in the months ahead, with large falls in the volume of goods purchased and inventories.

Employment across the eurozone fell for the eleventh month in succession, with the rate of decline accelerating in services but easing in manufacturing. German employment dropped at the fastest rate since January 2010, while the eurozone periphery saw the fastest rate of job losses since July.

First Published: November 22, 2012: 7:54 AM ET

08.36 | 0 komentar | Read More

Federal investigators keep circling Steven Cohen and SAC Capital

The feds are circling around Steve Cohen, targeting employees of his firm SAC Capital for insider trading.

NEW YORK (CNNMoney) -- The feds have been circling hedge fund titan Steven Cohen and his firm SAC Capital Advisors for some time, sniffing around for signs of insider trading and making peripheral strikes on people who've worked there.

They swooped in again on Tuesday, getting a bit closer to their prize. Though they didn't name Cohen in their criminal complaint, they charged his former portfolio manager Mathew Martoma with insider trading in a $276 million scheme.

"They have followed the trail, so to speak, from witness to witness, from defendant to defendant," said Thomas Gorman, a former senior counsel in the enforcement division of the Securities and Exchange Commission who now represents defendants of SEC cases.

SAC Capital spokesman Jonathan Gasthalter denied any wrongdoing by his firm or its owner, and said that they actually helped with the investigation.

"Mr. Cohen and SAC are confident that they have acted appropriately and will continue to cooperate with the government's inquiry," said Gasthalter.

The feds have targeted seven other employees of SAC Capital in the last two years on allegations of insider trading, including two who worked at its subsidiary, CR Intrinsic Investors. Three of the SAC employees -- Choo Beng Lee, Donald Longueuil and Jon Horvath -- pleaded guilty. Others made deals with the feds, including Noah Freeman, who was a cooperating witness, and Jonathan Hollander, who settled with the government.

"In the case of Mr. Cohen, they've found people that used to work with him, but they haven't found evidence that he's involved in insider trading yet," said Gorman. "What they're doing is they're sort of following the witness trail."

Preet Bharara, U.S. Attorney for the Southern District of New York, called the Martoma case the "most lucrative" insider trading scheme ever. His criminal complaint charges Martoma with securities trading fraud. In it, Bharara details Martoma's alleged pharma stock pump and dump scheme, based on inside information of Alzheimer's drug trials at Elan (ELN) and Pfizer's (PFE, Fortune 500) Wyeth.

Martoma collected a bonus of more than $9 million before he was terminated from Cohen's firm in 2009, according to federal documents. Martoma's lawyers maintain his innocence.

Related: Hedge funder charged in $276 million insider trading case

The U.S. Attorney did not identify Martoma's hedge fund and did not name the hedge fund's owner. But the SEC, which also leveled charges against Martoma and his hedge fund advisory firm, identified the firm as CR Intrinsic Investors, which is a subsidiary of SAC Capital Advisors.

SAC Capital is the $13 billion hedge fund run by Cohen, who placed fifth on AR, a hedge fund trade magazine's, rich list this year, earning $585 million in 2011.

In its complaint, the SEC said that Martoma worked closely with "Portfolio Manager A," described as the "owner and founder of Investment Adviser A and CR Intrinsic" and "a senior portfolio manager at Investment Adviser A."

The SEC also named the neurologist, Dr. Sidney Gilman, who first provided inside information to Martoma and then cooperated with feds. He paid a fine to settle the case and avoided criminal charges.

"Mr. Gilman knew about the individuals he dealt with, but he didn't know about Mr. Cohen or SAC Capital," said Gorman. "So the government didn't have the information to charge Mr. Cohen or SAC Capital."

Related: A who's who of Steve Cohen's web

The feds have been cracking down on Wall Street shenanigans, like the insider trading allegedly perpetrated by Martoma from 2006 to 2008. April Brooks, special agent in charge with the Federal Bureau of Investigation, said the arrest of Martoma was "the latest in the FBI's five-year campaign to root out insider trading at hedge funds and expert networking firms, which has resulted in more than 70 arrests to date."

First Published: November 21, 2012: 2:15 PM ET

08.37 | 0 komentar | Read More

NTSB drops 'unacceptable' BlackBerry for iPhone

The NTSB says its RIM devices have been failing 'at inopportune times and at an unacceptable rate.'

NEW YORK (CNNMoney) -- The National Transportation Safety Board is the latest federal agency to ditch its BlackBerry phones for Apple's iPhone -- and it had a few scathing words about why it's making the switch.

Research in Motion's BlackBerry devices "have been failing both at inopportune times and at an unacceptable rate," the agency wrote in a procurement request issued last week.

NTSB spokesman Eric Weiss, citing procurement rules, declined to name any specific problems the agency has had with its BlackBerry phones. RIM (RIMM) has suffered a few high-profile outages, including a global, three-day disruption last year.

"The NTSB requires effective, reliable and stable communication capabilities to carry-out its primary investigative mission and to ensure employee safety in remote locations," the agency wrote. "Due to performance issues with the blackberry [sic] devices, the NTSB desires to transition to a different device."

RIM declined to comment specifically on the NTSB's criticisms.

"We have 1 million government customers in North America alone who depend on BlackBerry, and more than 400,000 government customers worldwide upgraded their devices in the past year," the company said in a written statement. "We are committed to the mobility needs of government agencies around the world and will continue to meet these needs with BlackBerry 10."

The NTSB isn't waiting around for BlackBerry 10, the next-generation platform that RIM plans to launch on Jan. 30. It intends to switch to Apple's (AAPL, Fortune 500) iPhone 5 running on Verizon' (VZ, Fortune 500)s network. That's the only device that is both available from its existing wireless vendor and is "currently supportable by existing staff resources," the agency said.

The NTSB has a staff of around 400, not all of whom have agency-supplied phones, according to Weiss. Its switch won't put much of a dent in BlackBerry's sales, but the NTSB is just one of a growing wave of government groups moving away from the device, which was once ubiquitous in Washington's power corridors.

U.S. Immigration and Customs Enforcement switched to iPhones recently, saying RIM's technology "can no longer meet" its needs. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the National Oceanic and Atmospheric Administration made the swap earlier this year.

Most ominously for RIM, the U.S. Department of Defense is planning to relax its BlackBerry-only policies. The agency posted a procurement request last month for software to manage at least 162,500 Apple and Android mobile devices. DOD hopes to add them to its IT mix in the near future.

First Published: November 21, 2012: 2:28 PM ET

08.37 | 0 komentar | Read More

Black Friday: Shorter lines, but bigger checks

Fewer shoppers are expected in stores this Black Friday weekend, but some experts are predicting big sales and deep deals on the retail holiday.

NEW YORK (CNNMoney) -- Despite stores falling over themselves with incentives and earlier openings than ever this Thanksgiving, fewer people are expected to turn up for Black Friday sales.

An estimated 147 million shoppers plan to shop this coming weekend, down from 220 million last year, according to the industry trade group the National Retail Federation.

For many Americans, it's hard to make holiday shopping a priority in a year when the "fiscal cliff" and slow economic recovery are causing worry lines. They are less willing to spend freely with the looming specter of having to pay higher taxes after the end of the year, when the Bush-era tax cuts expire.

Many shoppers in the Northeast are also still dealing with the aftermath of of Superstorm Sandy, which has distracted residents and retailers alike from holiday preparation.

With the state of the economy and holiday budgets hanging in the balance, experts say it's hard to entice people with Black Friday deals. Others may be holding off for better deals later in the season.

"Consumers are continuing to put off purchases until they absolutely have to buy or they feel there are no better deals to be had," Robert Passikoff, founder and president of brand research consultancy Brand Keys. "People are waiting longer and longer for better sales, for the economy to turn, for electronic coupons."

But the more trepidation shoppers seem to have, the more retailers are pulling out all the stops to reel them in.

The holiday deal blitz started as early as September, with stores like Toys R Us, Wal-Mart (WMT, Fortune 500), Kmart, Target (TGT, Fortune 500) and Best Buy (BBY, Fortune 500) offering incentives like layaway plans, price matching and apps.

Stores have also been gunning to be the first to open for the big annual holiday sales. As it stands now, Toys R Us and Wal-Mart will be the first to open their doors for bargain hunters at 8 p.m. on Thursday, Nov. 22, just as some people are tucking into desserts after their turkey dinners.

That's even earlier than last year, when the toy store opened at 9 p.m. and Wal-Mart at 10 p.m. Target will open at 9 p.m. compared to midnight last year. Macy's (M, Fortune 500) stores will open at midnight and JC Penney (JCP, Fortune 500) at 6 a.m on Friday.

Related: Black Thursday is the new Black Friday

Black Friday traditionally marks the start of the holiday shopping season each year. Stores consider it the most important time of the year, because they can make up to 40% of their annual sales in the November-December period.

Even with fewer shoppers headed to stores, some experts are predicting that sales will be strong. According to MasterCard Advisors SpendingPulse, which estimates total U.S. retail sales across all payment forms including cash and check, Black Friday 2012 could exceed $21 billion in sales, up from $19.3 billion in 2011.

Also, the retail trade group NRF has been woefully wrong with its estimates before. Last year, it expected 152 million shoppers and 220 million showed up.

While people are more cautious about their spending, they are more confident than they have been over the last several years, some say.

"We could go back to pre-recession level retail sales this year," said Hana Ben-Shabat, a retail partner at consultant A.T. Kearney. "There's more comparison and sensitivity about prices, but eventually, they do buy what they want to buy. That's a very different reality than in 2008."

Many retailers are taking heat for their early opening times, since it means that workers have to miss out on Thanksgiving celebrations with their families. More than 40 petitions have been launched on Change.org asking retailers including Sears, Target, Wal-Mart and Kohl's to "give Thanksgiving back to families."

Related: Why is sucks to work Black Friday

At Wal-Mart, a group of workers are planning a protest on Black Friday, which could make for an unpleasant shopping experience for people headed to the stores of the nation's biggest retailer. Wal-Mart says that the protesters make up just a handful of its 1.3 million workforce, but organizers of the expected protests say more than 1,000 activities have been planned nationwide.

Support for the demonstrations have swelled as Black Friday approaches. More than 30,000 people "like" the organization's Facebook page and they have collected more than $60,000 to support workers who participate in the walk offs.

For extreme Black Friday shoppers like Joni Crothers, nothing will get in the way of her shopping mission. Last year, Crothers came away with $10,000 worth of goods for just $2,000. She donated everything she bought to local families in need.

"We need a way to stretch our money as quickly and as best as we can, and it's amazing how much money you can save," Crothers said.

Toys and electronics are usually the biggest draw for Black Friday shoppers. Toys R Us says it has already seen a shortage of this season's hot toys like the Hasbro's Furby and Hot Wheel's Power Wheels Dune Racer.

Related: Black Friday deals to avoid

Best Buy, Target and Wal-Mart are offering steep discounts on electronics like iPads and LCD HDTVs.

If the possibility of scoring a deal isn't enough of a draw, for many people it's a tradition they are not willing to give up, says Trae Bodge, senior editor of RetailMeNot.com Insider. She said that for some people there's something compelling about waiting in long lines after Thanksgiving.

"Despite the rise of online shopping and the economy, there is still a strong interest to do that whole Black Friday thing," she said. "There's a weird tradition that goes on."

First Published: November 21, 2012: 3:03 PM ET

08.36 | 0 komentar | Read More

HP's $9 billion Autonomy whoops is small change compared to past tech debacles

NEW YORK (CNNMoney) -- Hewlett-Packard's $8.8 billion writedown of Autonomy on Tuesday slammed a deep crater in HP's balance sheet, but it's just a drop in the bucket compared to some of the epically disastrous tech mergers of the past decade.

The most infamous example -- and the largest write-off of a merger in corporate history -- was AOL Time Warner's (TWX, Fortune 500) $100 billion write-off in 2002. AOL purchased CNNMoney and Fortune's parent company in 2001 for $106 billion. The combo quickly went south: The company wrote down $54 billion in the first quarter of 2002 for the deal's diminished value and $45.5 billion in the fourth quarter for the AOL (AOL) unit's decline. The entire value of the merger essentially evaporated into thin air less than two years after it was consummated.

But it doesn't even take a merger widely considered the worst in corporate history to trump HP's (HPQ, Fortune 500) Autonomy snafu.

Former networking giant JDS Uniphase (JDSU) had the previous record for an impairment charge. In 2001, after the dot-com bubble burst, JDSU wrote $38.7 billion off its books -- the entire value of the handful of companies it had purchased over the previous two years.

Telecoms didn't have a good start to the last decade. Qwest Communications in late 2002 took a $30 billion writedown on the U.S. West purchase it made in 2000. Qwest was later purchased by CenturyLink (CTL, Fortune 500) for just over $12 billion.

Related story: How Hewlett-Packard lost its way

Some telecoms didn't have a great end to the decade, either. In 2008, Sprint Nextel (S, Fortune 500) wrote off $29.7 billion of the value of its $35 billion merger. It wrote off another $543 million in April 2012, as the company prepared to completely shut down the Nextel brand.

Write-downs happen when the value of an acquisition sinks, thanks to underperforming sales or because the acquired company's brand deteriorates. "Goodwill" is the accounting term for certain intangible assets, like a company's reputation. When those go south, accounting rules require companies to strip the asset off their balance sheet.

Most do that in one fell swoop, as HP did this past quarter -- knocking $8.8 billion off HP's profit and resulting in a quarterly loss.

Even though HP never had a single whopping write-down, like some of its technology peers, it collected a whole bunch of them recently: three in the past five quarters.

A year ago, HP wrote off $885 million of its $1.2 billion Palm purchase, which it had made in 2010. The WebOS software was a complete failure, culminating in the disastrous TouchPad tablet, which lasted exactly 49 days on the market before getting pulled off store shelves.

This summer, HP took a $8 billion writedown on its purchase of services business EDS, a deal which was valued at nearly $14 billion in 2008. HP also wrote down $1.2 billion that quarter on the Compaq brand, which it plans on phasing out. That move marked the finale of the controversial $25 billion takeover deal HP made in 2002 -- and a further diminishing of former CEO Carly Fiorina's costly legacy.

First Published: November 20, 2012: 3:07 PM ET

08.37 | 0 komentar | Read More