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Swing state voters can proudly cast their ballots knowing that their votes may actually count in the presidential election. But the price of that privilege is an onslaught of political campaign ads, sometimes so heavy that political ads fill every slot of a commercial break, particularly on local television news broadcasts. These ads have crowded out staple local advertisers, like car dealerships and furniture stores. And the high demand has sent prices soaring, meaning local businesses must pay huge premiums to advertise during peak campaign season.
Many have sat it out, both because of the high cost of ad time and out of a desire not to be mixed in with political ads that may anger viewers. Come Nov 7, those political ads evaporate, but that doesn’t mean thing are back to normal in broadcast advertising. “Still the rates are gonna be a little higher than normal,” says Karen Ashworth, a media buyer at Virginia ad firm Barber Martin. “I don’t think that they’re gonna go down until January.” Part of this is because of the holiday season, when ad rates typically rise. But mainly, there’s pent-up demand from advertisers who didn’t get on air during the race.
Local advertisers long to reclaim airwaves
Warning signs from several big advertising companies late last month about a significant slowdown in ad spending puts the spotlight on U.S. media-company earnings due this week.
CBS, Time Warner, Discovery Communications and News Corp, all of which have significant advertising exposure through their TV networks and other media outlets, will report for the September quarter. Analysts looking for clues about the state of the ad market are likely to closely scrutinize their results, along with any comments company executives make about the fourth quarter. Executives are likely to indicate the expected impact of Hurricane Sandy. Some TV stations broadcasting news coverage of the storm cut their advertising drastically or went ad-free for a couple of days last week. The superstorm's total impact on the advertising market could be a revenue loss of about $500 million, or 1% of the volume for the fourth quarter, estimates Pivotal Research Group analyst Brian Wieser. The overall ad climate this year has been lackluster, despite the strong boost provided to TV advertising by the election. During earnings reports for the second quarter, over the summer, media executives blamed the Olympic Games for soft ad-revenue growth, saying that much of the available ad spending had been shifted to NBC during the Games, hurting competing media companies. At that time, executives, in general, were cautiously positive about the third quarter. In late September, Time Warner Chief Executive Jeff Bewkes said at a conference that the ad market looked "a little better," but "there's not yet resurgence."
Media Firms Signal Sluggish Ads
The Federal Trade Commission supports attempts by Web browsing companies, advertisers and privacy groups to develop industry standards on Do Not Track technology and wants to see ongoing talks play out before backing a legislative solution. At the same time, the FTC isn’t taking a position on a fight between stakeholders about whether to make DNT a default setting in Web browsers, even as Microsoft butted heads with Yahoo last month over its announcement that it would turn on those signals by default in the next version of Internet Explorer.
The officials said during a meeting Nov 2 that they’re trying to support consumer privacy by stepping in when they think companies have gone over the line and promoting values like transparency and choice across the online ecosystem. That includes the agency’s work with Internet stakeholders to design a system whereby consumers have a choice about where their data goes, although that has been a “two steps forward, one step back” process, FTC Chairman Jon Leibowitz said. Discussions among World Wide Web Consortium members about Do Not Track standards seem to be moving forward, the officials said, and the FTC wants to nurture that process.
FTC gives groups time on Do Not Track
The debate playing out in Washington has echoes of a presidential race. One side says businesses will suffer unless the government steps in to lower costs. The other accuses jet-set industrialists of a ploy that will cheat the middle class. These attacks, however, are not between candidates for the White House. They are being made in a battle over the obscure but increasingly vital issue of royalty rates for streaming music online.
The issue pits the survival of Pandora Media and other Internet radio services against the diminished paychecks of musicians in the digital age. This fight has raged on and off for more than a decade, and it was renewed recently with a bill in Congress that would change the way digital royalty rates are set. But with streaming music starting to account for a significant chunk of the music industry’s revenue, and Pandora now a scrutinized public company, the issue has touched a nerve as never before.
Fight Builds Over Online Royalties
Everybody lies. Children lie about brushing their teeth. Politicians stretch the truth in the heat of a campaign. Newspaper reporters have been caught lying, as have best-selling book authors; corporations; spouses and, of course, government officials. And so have lots of people on Twitter. It might seem that lies on social networks have become as common as the truth. Fabrications and sham pictures spread via Twitter during Hurricane Sandy and propaganda during the presidential campaign. But is it a cause for worry? I don’t think so. Twitter, in its own way, has a self-correcting mechanism.
Twitter’s Uneasy Role in Guarding the Truth
Amazon prides itself on unraveling the established order. This fall, signs of Amazon-inspired disruption are everywhere. There is the slow-motion crackup of electronics showroom Best Buy. There is Amazon’s rumored entry into the wine business, which is already agitating competitors. And there is the merger of Random House and Penguin, an effort to create a mega-publisher sufficiently hefty to negotiate with the retailer on equal terms. Amazon inspires anxiety just about everywhere, but its publishing arm is getting pushback from all sorts of booksellers, who are scorning the imprint’s most prominent title, Timothy Ferriss’s “The 4-Hour Chef.” That book is coming out just before Thanksgiving into a fragmented book-selling landscape that Amazon has done much to create but that eludes its control.
Booksellers Resisting Amazon’s Disruption
[Commentary] They say you should never take on people who spill ink by the barrel, but your odds are better when you traffic in terabytes of data. In the United States, Google and big media went at it for several years over Google News and Google won, taking its argument for a free and open Internet all the way to the bank. It’s a little counterintuitive, but large newspapers believed that Google was hurting them by generating a page of links — with headlines and a short summary — to articles that the newspapers had paid to create. Publishers said that what was supposed to be an index of the news had become the news, and was a disincentive for people to click through to the source. American publishers eventually decided that the only thing worse than being aggregated by Google News was not being aggregated at all, but the fight has been joined anew in other countries by publishers who argue that the giant American search company is picking their pockets every time it links to articles. There’s a large boycott under way in Brazil, punishing legislation is gaining momentum in Germany, and there is talk of a similar effort in France.
Publishers Abroad Take On Google
[Commentary] Supap Kirtsaeng bought textbooks published overseas by John Wiley & Sons and resold them on eBay and other Web sites for a profit in the United States. The publisher sued Mr. Kirtsaeng for violating its copyright, and the case went before the Supreme Court. At stake in this important and knotty case is whether copyright holders — publishers, filmmakers, musicians and creative artists of all sorts — can sell their copyrighted works abroad at prices different from what they charge in the American market and rely on copyright law to help maintain the separate pricing without having importers profit from the difference.
The justices should rule that the Copyright Act and a revision to it that Congress made in 1976 prohibit such resales. This case requires a difficult interpretation of the Copyright Act, but that is made easier by understanding the intent of Congress when it revised the law in 1976. It did so to broaden protection against unauthorized imports of copyrighted works by so-called gray-market sellers, and to make easier the kind of market segmentation by geography and price that Mr. Kirtsaeng’s resales subverted. With segmentation, book publishers can offer cheaper editions of their works in less-developed countries, without concern that those copies will be resold in the United States and unfairly undercut sales here.
Copyright on Imported Works
A city run by one of China’s incoming political leaders that has billed itself as a future international financial center is instead becoming the country’s internet censorship capital.
Tianjin, whose Communist party secretary Zhang Gaoli is one of the seven men most likely to get a seat on the new politburo standing committee due to be unveiled at the 18th party congress starting on Nov 8, is developing a replica of Manhattan to which it aims to attract global banks. But local government officials explaining a mock-up of Yujiapu, the new district on the site of a former fishing village, last week said they did not know of any foreign bank that had committed to coming. Meanwhile, some of China’s leading internet companies are relocating their censorship operations to Tianjin as they battle soaring labor costs.
China’s ‘Manhattan’ becomes censorship capital
Apple paid an income tax rate of only 1.9 percent on its earnings outside the U.S. in its latest fiscal year, a regulatory filing by the company shows.
The world’s most valuable company paid $713 million in tax on foreign earnings of $36.8 billion in the fiscal year ended Sept. 29, according to the financial statement filed on Oct. 31. The foreign earnings were up 53 percent from fiscal 2011, when Apple earned $24 billion outside the U.S. and paid income tax of 2.5 percent on it. The tech giant’s foreign tax rate compares with the general U.S. corporate tax rate of 35 percent. Apple may pay some income taxes on its profit to the country in which it sells its products, but it minimizes them by using various accounting moves to shift profits to countries with low tax rates. For example the strategy known as “Double Irish With a Dutch Sandwich,” routes profits through Irish and Dutch subsidiaries and then to the Caribbean. Other multinational corporations also use such tax techniques, which are legal.
Apple paid only 1.9 percent income tax on $36.8 billion in earnings outside US in fiscal 2012