Friday, July 20, 2007

Journalism: Getting Your Foot through the Newsroom Door


by: Laurence Cawley

As many as half of all graduates say they'd like a career in the media.
That's a lot of graduates out there who want the same job you want or
the job, if you are already working in the media, you currently have.
I've heard this statistic banded about many times - often by editors or
managing directors of newspaper groups justifying the poor pay
journalists tend to get. I have no reason to doubt the statistic - I've
met a lot of graduates who say they'd like a career 'in the media'.
Most of them now work as management consultants, accountants, in
advertising or in sales. However, even if many of those who want a
career in the media never quite get there, there is a simple truth: the
route to being an employed journalist is competitive and the going is
tough (at first).



As is the case with all competitive environments it pays to ensure
that you stand out from the crowd. But to know how to stand out from
the crowd, you have to know what an editor is looking for from a
potential candidate. Put simply, editors tend to be looking for:




A commitment to a career in journalism




Self-confidence that stops way short of arrogance




An eagerness to learn and a keenness to help and get involved



We'll focus on the top of the editor's wish-list first.
Demonstrating a commitment to a career in journalism is vital and will
be something all editors are looking for in any new recruit. The
following steps all demonstrate a commitment to your chosen career:




Asking and undertaking unpaid work experience at a local newspaper




Working on a school, university or community newspaper or news-sheet




Finding a good news story and then phoning a newspaper with it whilst asking for work experience




Undertaking training to become a journalist at one of the many establishments that offer courses.



This not only shows you are committed to a career in journalism but
also that you are willing to go to the financial expense of getting
yourself ready to become a journalist.




Undertaking a degree in journalism or media studies:



Believe it or not, the last option listed above will be the least
likely to impress an editor. Many editors are skeptical about the value
of journalism or media-based degree courses. They are often tinged with
more theory than practical tuition and cover the ethics and philosophy
of journalism when most editors are more concerned with tight copy,
written in a legally-sound way which will inform or entertain their
readers. On a personal level, I think media studies and journalism
degrees are excellent and, if combined with experience of working as a
journalist, offer an excellent grounding towards becoming a considered
and insightful reporter. But unless the degree includes a certificate
to say you have got your shorthand speed to (ideally) 100 words per
minute, a thorough grounding in media law and court reporting, a basic
understanding of local and central government and proof that you know
how to construct a news story, a degree in journalism or media studies
is unlikely to lead to a job. Unpaid work experience, however, often
leads to a job - though not on its own.




Work experience:



If you don't have a cuttings file (a selection of stories published
in a newspaper written by you) then getting work experience is a vital
step. Not only does it give you invaluable experience of trying your
hand at journalism it also gives you the opportunity to:




* See how a newsroom operates and how a newspaper is put together



* Learn from experienced journalists and see how they handle
different jobs Work out whether a career in journalism is really for
you.




* Show a potential employer what you have to offer




* Develop a cuttings file of your own work under your own name



Getting work experience is reasonably straight forward. In most
cases all you will have to do is ask. But you need to make sure you ask
the right person so it is usually best to telephone the newspaper or
newspapers you are interested in doing some work for and asking for the
name of the person who deals with work experience candidates. Sometimes
this is the editor, sometimes the news-editor and sometimes the chief
reporter. When you write your letter asking for work experience,
remember two main points:



1. Check and double check for any spelling mistakes - it is often a
good idea to then get somebody else to check it a further time before
sending it off. I have always avoided offering work experience to
candidates who cannot be bothered to check their spelling before
sending something off.



2. Keep it simple. Tell them you are interested in a career in
journalism and tell them that, in the longer term, you would love to
work for their paper. Highlight any skills you currently have that
could be counted as a journalistic tool and tell them what your
intentions are regarding training.



Usually this sort of approach will get you a period of work
experience - usually a week or two. Sometimes, because newspapers have
a lot of people wanting work experience, you may have to wait sometime
before either hearing back or being offered a short term work
experience placement. If you have a number of titles in your area,
apply to them all.



When you are offered work experience with a newspaper, there are a
few things to keep in mind in order to ensure you get the best out of
the placement and that you show your best sides to an organization that
is a potential employer. It is wise to:



Dress smartly and appropriately as you would for a formal job
interview. You may be sent anywhere at any time and, even if you are on
work experience, you are still an ambassador for the newspaper. If you
end up shadowing an established reporter to court, you must wear a
shirt and tie if you are male, or be smartly dressed if you are female.
This sounds an obvious point but I've known work experience candidates
turn up wearing jeans and tee-shirts and in one case a beanie hat.



Don't be afraid to ask questions about things you are unsure of and
offer your help whenever possible. Help may include offering to get
file cuttings from the library or even just making the coffee. The
point is you want to come across as a keen learner who wants to pitch
in.



Try to find stories both during the working day and outside of
working hours. Most news-editors and editors would be highly impressed
with a work experience reporter bringing in their own news stories.
They may not get used, but they will get you noticed. If they do get
used, however, they will be more than noticed - they will be
appreciated and you will be held in increasingly high esteem.



Listen to everything that is said to you. When I first did work
experience for an evening title in Yorkshire I was fresh out of
Cambridge University and I was convinced I was one of the best writers
in the country. I was wrong, and I did not have a clue how to write a
news story. When this was pointed out by the news-editor I was taken
aback at first but I quickly saw what she meant and tried my best to
learn the craft from her and to learn fast. The golden rule really is
to do whatever is asked and to heed advice . Be confident, by all
means, but avoid coming across as arrogant like the plague. Remember,
you are there to learn.



Always turn up on time. This sounds such an obvious point that you
might be surprised it's in this list. Believe me though, it wouldn't be
in the list if it wasn't a mistake I've seen made again and again. Try
to be a little early and leave a little after you are told you can
depart. Newspaper reporters have to be punctual in their starting times
because many newspapers are deadline driven and news-editors need to be
able to bank on staff being where they are supposed to be in case they
need something covering at very short notice.



Be affable and upbeat. I've seen many work experience candidates
sit quietly in the corner looking moody. I know that in most cases this
was a sign of nervousness in a newsroom. Whilst I can sympathise with
that, I would much rather help a candidate who is making an effort to
be a pleasant presence around a newsroom.



These brief pointers should help ensure you get the best out of
your work experience placement and that the newspaper gets the best out
of you. Somebody who is remembered as smart, friendly, helpful, eager
to learn and always turns up on time will be in good stead for a job
when their training is completed. They are also the most likely
candidates to be offered further work experience in the future.
Exceptional work experience placements can also lead to a newspaper
paying thousands of pounds to get you trained up as a journalist with
the offer of a job at the end of the training. Not all newspapers offer
this, but many do. Either way, work experience is the most important
first step in becoming a journalist. The second step, of course, is
learning the craft through training.




Getting trained:



There are hundreds of educational establishments out there offering
courses relating to the media. They offer everything from degrees to
home study courses. For newspaper journalism in the UK, the
organization nearly all editors look to is the National Council for the
Training of Journalists (NCTJ). In broadcasting there is the Broadcast
Journalism Training Council and Skillset. There are other bodies in
both print and broadcast industries but these three are generally the
most respected organizations and qualifications accredited by them tend
to hold the most sway with potential employers.



The NCTJ offers the leading training system in the UK and the
pre-entry qualification to newspaper journalism is the one most
newspaper editors expect to see before offering a candidate a job. I
started out after completing my NCTJ course and while most journalistic
learning is done through experience and on the job, the skills acquired
on the NCTJ course were essential to preparing me for the proper
learning to take place. The range of courses accredited by the NCTJ
vary from year-long courses to much shorter 'fast-track' courses which
last a few months. Either way, at the end you will have a good
grounding and a qualification in:




Shorthand - the essential tool all journalists need in order to take down information and to quote sources accurately.



Media law - editors live in fear of law suits from people who have
been defamed or from their newspaper ending up in contempt of court.
Knowledge of media law is essential and you are unlikely to get a job
without this invaluable knowledge.



Public affairs - all reporters need an understanding of the
machinations of local and central government because they often form
the grist of newspaper stories.



Writing - knowing how to write a news story is obviously a vital
skill that all editors are looking for from their employees. The NCTJ
course will hone your skills and teach you the basic style guide on
which most newspaper writing styles are based.



Training can be tough and the courses thorough and exacting. During
your course you, or those around you, will endlessly debate your
current shorthand speed and get exasperated that it isn't close to
reaching the 100 word a minute industry standard (for help with this
click here). Shorthand is one of the most important parts of training
to get right and, for most people, it is the part of the course that is
both the most foreign and the part that raw intellect doesn't seem to
improve. During the course, it is a wise idea to keep getting work
experience or sending in good news stories to newspapers to help build
your cuttings file and to maintain contacts within the industry.



Once you have a clutch of passes under your wing, and your
shorthand at 100 words per minute (or near), you are ready to head out
there and seek employment. Sadly, even with the proper credentials,
competition for jobs can still be fierce. Years ago, when I was
applying for jobs I sent out 61 application letters. I had one reply,
which was an offer of an interview 200 miles from where I was living at
the time. Luckily for me, this single response turned into my first
job. But it took a few months of sending out on-spec applications to a
huge number of newspapers. I hope you will not have the experience but,
if you do, know that you're in good company.



As an aside, and because it is a question I've been asked
frequently by raw recruits, I wanted to touch on the issue of where to
start your career. Most, including myself, start out on local
newspapers. But national newspapers also offer extremely good trainee
schemes. Amongst most people in journalism training, the national press
is held in much higher esteem. This is understandable - the readerships
are (by and large) much greater, the stories tend to be greater in
scope and scale, the pay is better and the scene is more 'glamorous'.
Having worked in both the regional and national press I can see the
merits in trying to start out in both. If I was forced to make a
choice, I would always advise starting with a local newspaper. My
reasons for this are simple. Firstly, you get to learn your craft
within a defined community and, if you make a mistake, your community
will be quick to point it out. This is a useful fact of life and
constantly focuses the reporter's mind on the all important task of
getting things right and making sure stories are accurate. Secondly,
you will tend to get more scope to practice your new skills and cover a
plethora of different stories. Thirdly, your chance of getting a front
page story or a page lead (the main story on a page) in print is far
higher. A friend of mine spent 18 months on a trainee scheme with one
of the quality British broadsheet papers. At the end of the 18 months
she had only a handful of stories of stories with her name on it - the
one I remember best was an interview with a bee-keeper. In the same
period, I had covered bus and plane crashes , murders, major education
stories and an armed siege. All of my stories were national stories,
but I was writing for a local paper (indeed some of them were bought
from me by national titles).



I had about 50 or so front page stories and countless page leads in
my portfolio. And my cuttings portfolio is nothing out of the ordinary
for the local reporter. My friend on the other hand was a raw recruit
in a field of highly experienced and very established (often
specialized) national level journalists. The chances of her ever
getting into print were slim when it came to writing hard news. I
respect views different to my own, but I nevertheless hold firm to my
view that the local press offers the best grounding in journalism.
That, I feel, is demonstrated by the fact that nearly all of the
reporters working for the national press started out on local
newspapers.




A DEGREE OR NO DEGREE



Does having a degree help get a foot on the journalistic ladder?
Not necessarily. It never hurts, of course, to have an expertise in
some area to degree level and many journalists have degrees in subjects
like history or English. For specialist titles it can pay to have a
degree in, say, science or information technology. But for a general
reporter a degree is by no means necessary. I have worked with many
people who do not have degrees or A Levels and those people have often
been editors or news-editors with a razor-sharp news sense and an
incredible ability to generate and produce great news stories.



What is necessary is a good command of the English language and
numeracy skills. Usually a GCSE qualification in English and maths is a
requisite. But to get on in journalism a degree qualification will pale
into insignificance compared with the following:




An ability to write accurately and quickly




An ability to generate news stories on your own initiative




An interest and knowledge of your own community




An ability to ask the right questions of the right people



Many people who have not gone into higher or further education have
been picking important life-skills in the 'real world' which can become
a real asset for a would-be journalist. The same goes for people
wanting a career change into journalism. Such people are likely to get
a warm response from editors, whatever their age might be. The reason
is simple: mature candidates or those who did not go into higher
education are likely to be more 'street savvy' than those fresh out of
college.









About The Author

Laurence Cawley is a professional journalist
who has worked in the regional and national media for the past 10
years. A dedicated shorthand practitioner, he is also the editor of http://www.shorthandworld.co.uk.




Permission to freely re-use this article is given provided a link is provided to its source and copyright holder at http://www.shorthandworld.co.uk.



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Tesla: A Carmaker With Silicon Valley Spark

The tech veterans behind Tesla think they know a better way to build an electric carIt takes big car
manufacturers four years to develop a new model. In that period of
time, Tesla Motors Inc. has created a brand-new kind of car
company--not to mention plenty of buzz.

Filling the niche for a green vehicle that isn't virtuously homely,
Tesla has buyers standing in line to buy its sleek $98,000 electric
sports car, which starts coming off the assembly line in October. The
wait list now includes George Clooney, California Governor Arnold
Schwarzenegger, and Google Inc. (GOOG
) founders Larry Page and Sergey Brin. They want to be the first in
their neighborhoods to own the eerily quiet machine that can rocket
from 0 to 60 in four seconds.



But once the short list of environmentally conscious tycoons trades in their Toyota (TM)
Priuses for Tesla Roadsters, will there be enough business for the
company to survive? Boutique automakers have a grim history. The last
car startup to make it was Walter Chrysler's namesake company in 1925.
Many auto industry insiders are impressed with Tesla's technology, but
question whether the 250-employee San Carlos (Calif.) company will be
able to sell enough cars to thrive in the ultracompetitive global car
industry. "These guys look undercapitalized to build cars in real
numbers," says James N. Hall, vice-president of AutoPacific Inc., an
auto industry consulting firm. "They can sell cars until other, bigger
manufacturers start selling vehicles that aren't pure electrics but are
green enough."


So what makes Tesla think it has a chance? The very fact that
it has been built by outsiders. After all, Detroit is hardly a model of
corporate efficiency. Tesla bills itself as Silicon Valley's version of
a car company. Importing executives and management ideas from the
technology industry, it is handing out stock options to every employee,
doing away with independent dealers, and outsourcing the manufacturing
of its cars. Almost all of Tesla's $105 million in startup capital has
come from wealthy California idealists and venture investors. "Silicon
Valley is the best in the world at everything it does," boasts Elon
Musk, the PayPal (EBAY
) founder who sold the company for $1.5 billion before becoming Tesla's
chairman and chief source of funds. "The corporate culture [in the
Valley] is extremely efficient and very competitive."


Startup energy radiates from Tesla's converted warehouse space
on a side street in middle-class San Carlos. All of the top
executives--except Musk, who isn't involved with day-to-day
operations--work together in small, cheaply decorated offices. If big
decisions need to be made, no one needs to schedule big meetings, write
up proposals, or go through any chains of command.



BATTERY POWER
Tesla CEO Martin Eberhard, a former
computer engineer, says he is trying to build a car manufacturer that
is also a technology company. By outsourcing mundane parts like brakes
and seat belts, Tesla engineers are able to focus on a few core
technologies: the battery, the computer software, and the proprietary
motor that make the car go. Unlike Toyota, General Motors (GM
), and Ford Motor (F
), whose hybrids use nickel metal hydride batteries, Tesla believes its
lithium ion technology will ultimately be cheaper and have more storage
capacity.


Lithium ion batteries also happen to be the power source for
something people in Silicon Valley know well: the laptop computer. The
sophisticated energy storage device that sits in the trunk of the Tesla
Roadster is merely a bundle of 6,831 laptop battery cells. Right now
this pack costs about $20,000 to produce, about one-fifth of the car's
price.


Any hope Tesla has of achieving Eberhard's dream of producing
higher volumes of cars annually rests on cutting this cost. The company
also is going to have to boost the range of its cars beyond the current
maximum of slightly more than 200 miles and provide owners with a
reasonably glitch-free product (never an easy thing for a new
manufacturer to do). The next vehicle on Tesla's drawing board is a
five-passenger sedan code-named White Star. The target price will be
from $55,000 to $68,000. In five years, Eberhard wants to be producing
a $30,000 electric car known as Blue Star.


Tesla's team is hoping to benefit from a battery technology
that is already improving rapidly. The production of laptop cells has
tripled in the past five years, dropping the cost of lithium ion
batteries down 8% annually. That trend should continue. The company's
scientists also are betting they can find ways to use their in-house
expertise to adapt lithium ion batteries for use in lawn mowers,
motorcycles, and satellites. This will help them achieve efficiencies
of scale without waiting for car sales to take off.


The company, which plans to go public next year, has created a
second division, Tesla Energy, to sell its energy storage technology
the same way Toyota licenses its hybrid systems. Its first customer is
Think Nordic, a Norwegian producer of small city cars. Some investors
believe this unit may have more potential than the car side of the
business.



NO MIDDLEMAN
While Tesla has Silicon Valley roots,
it has hired a slew of engineers from the Big Three and installed them
in its Michigan development center in Detroit's northern suburbs.
Tesla's new hires know they aren't working for "Generous Motors"
anymore. John Thomas, senior director for White Star, says his army of
Big Auto refugees isn't afraid to fly coach or work long hours. Tesla
also pays lower-than-average wages. But since everyone has stock
options, they'll reap big rewards if the company succeeds.


Tesla's business model also cuts out independent car dealers.
The company plans to have six dealerships in major cities. Each one
will have specialty technicians to make any repairs. Since about 10% of
a car's sticker price is the dealer's take, Tesla will save money.
Plus, the company is going for such low volumes that it won't waste
money on advertising, says Darryl Siry, vice-president for marketing.
"Porsche spends $1,000 a car on marketing," he says. "I essentially
spend zero."


Compared with Big Auto, Tesla's near-term sales goals are
modest--just 1,000 a year for the Roadster and 10,000 annually for the
future sedan. Eberhard believes they should be easily reachable. He
notes that owners of Toyota's Prius earn on average well in excess of
$100,000 a year. That means they can afford something much nicer than
Toyota's $22,000 hybrid. If necessary, the company would be willing to
use a small gas engine to boost Blue Star's range and broaden its
appeal.


Musk is convinced there are plenty of customers, like him, who
will want something faster or flashier than a Prius. At the moment, in
fact, he drives a Porsche and his wife drives a 14-mpg Maserati (FIA
) Quattroporte sedan. "I just can't get into the Prius," Musk says.


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Mobile TV Row in Brussels


Nokia-backed video digital technology stands to profit from a
controversial European Commission decision to back it as the single
standard



The European Commission has thrown its weight behind mobile TV by
backing the DVB-H technology to become the single standard for the
continent.



But there are concerns this could stifle competition in the market and reduce innovation.


By promoting the Nokia -- backed DVB-H (Digital Video Broadcasting
for Handhelds) technology, EC intends to reduce fragmentation and
accelerate the uptake of mobile TV across its member states.


Viviane Reding, EU Commissioner for the Information Society and
Media said Europe needs to take the lead with mobile TV by backing a
single standard -- as it did with GSM in the 1990s -- or risk other
regions getting ahead.


But industry commentators say other mobile TV platforms such as the
Qualcomm-backed MediaFLO and DAB-IP, as used by Virgin Mobile, should
not be ignored.


Analyst house Datamonitor said the EC's strategy will not aid the
mass adoption of mobile TV and will reduce open market competition.


Associate analyst Chris Khouri told silicon.com: "We were hoping
that mobile formats could coexist through chipset interoperability."


He added it is not yet clear whether one technology is superior with
each offering a different number of channels and with different
spectrum requirements.


DVB-H for example needs spectrum currently used by analogue
television broadcasters in the UK which will only become available
following the digital switchover in 2012.



Khouri said: "It's [the ECs approach] kind of jumping the gun a bit."


Telecoms consultancy Analysys said mobile TV should be driven by
consumer needs and a competitive landscape rather than through
government backing.


Jim Morrish, consultant at Analysys told silicon.com: "Other
technologies have natural zones of advantage. And that's something the
industry has to deal with, it's not an EU intervention or regulatory
management at all."


Omar Javaid, VP of global strategy and business development for
Qualcomm MediaFLO said the company believes in fair competition in
Europe to encourage the development of innovative technologies and new
networks.


European mobile TV take-up has been slow compared to other regions
but the Commission predicts the market could be worth €20bn
globally by 2011.



Provided by silicon.com—Driving Business Through Technology


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India Small Biz: Big IT Spenders


Small and midsize businesses in India will increase their storage tech
investments by 35% this year, to $480 million, according to a new study



In its latest report released Wednesday, the research house said that
spending on storage products and services is set to reach US$480
million this year, of which India's small businesses--defined as having
fewer than 100 employees--will account for the lion's share of the
investment.


Over 50 percent of the overall storage expenditure will be fuelled
by small businesses in the country, and this number is set to increase
as they "move up the technology adoption ladder", said AMI-Partners in
a statement. Small businesses in India account for 99 percent of the
country's SMBs.


Dev Chakravarty, a Kolkata-based analyst at AMI-Partners, said in a
statement that a key factor driving the growth of storage in the SMB
market is the usage of business applications such as ERP (enterprise
resource planning) and CRM (customer relationship management).



Other factors fueling storage expenditures include the deployment of Web sites and e-commerce, and SMBs' increased focus on data security and backup.


Chakravarty said that storage requirements will increase as
businesses adopt data backup, disaster recovery, and data replication
technologies.



According to AMI-Partners, there is a difference between the small and midsize businesses when it comes to storage investments.


While small businesses are focusing on hardware-related technologies
such as PC- and server-attached storage, medium-sized businesses are
adopting "more advanced network-attached storage media such as SAN
(storage area network) and NAS (network-attached storage", said
Chakravarty.


Midsize businesses--defined as having between 100 and 999
employees--also invest more on storage-related services, because they
have to manage "substantial quantities of data" compared to small
businesses, Chakravarty said.


"Moreover they are on a rapid growth path buoyed by the nationwide
economic growth," he said, adding that medium-sized businesses are
gradually expanding their businesses.


"This expansion results in a jump in the quantity of data handled,
and consequently, the requirement for robust data storage also surges,"
Chakravarty said. "Data archiving requirements due to regulatory
bindings and compliance needs is also an important driver."


Sixty percent of midsize businesses surveyed by the research house
said that increasing IT storage capacity and deployment of enhanced
storage solutions will be a primary strategic focus area for them in
the next 12 months.



Provided by ZDNet Asia—Where Technology Means Business


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Strong Numbers and New Products for SAP


Second-quarter results from the German software maker go a long way
toward restoring investor trust as it develops Internet-based software



SAP shares rose more than 6% after the company said that second-quarter
operating profits were up 10%, to $790 million on sales of $3.3
billion. The results reassured investors that the Walldorf (Germany)
maker of enterprise software can continue to maintain profit margins as
it spends $550 million over two years to develop software that will be
distributed over the Internet to business customers. "The company
managed to restore trust," says Knut Woller, analyst at Unicredit
Markets & Investment Banking in Munich.


But is the growth sustainable? SAP reported a 15.6% increase in
sales of software and software-related services in the quarter compared
to a year earlier. Much of the growth in that key indicator came from
customers upgrading to new products from SAP's warhorse R/3 software,
which companies use to automate business functions such as bookkeeping,
procurement, or logistics. However, Dan Sholler, analyst at market
researcher Gartner (IT), predicts that the upgrade revenue will tail off toward the end of 2008.


Huge Departure from Tradition



To keep the growth going, SAP is counting on its new Web-based,
software-as-a-service product, code-named A1S. The Web-based model
frees customers from having to invest in major computer infrastructure
and IT departments, and it makes SAP software more accessible to small
and midsize companies.


But the product, to be launched early next year, is also a huge
departure for SAP, which has traditionally sold software that companies
installed on their own computers. "[A1S] is not a product launch; it's
an entirely new business," SAP CEO Henning Kagermann told reporters on a conference call.



If all goes according to plan, the new product will generate enough
sales to compensate for a decline in upgrade revenue. If not, there's a
risk SAP growth could slow. "This whole A1S thing is a big bet that
they can get those revenue curves to cross," Gartner's Sholler says.
"If A1S doesn't go as they expect it to, there's a possibility that by
the end of next year they're going to be under some pressure" (see
BusinessWeek.com, 5/18/07, "SAP Caught Between Two Worlds").


Dominant in Enterprise Software



There's no question that SAP is one powerful company that has proven it
can master extremely complex software launches. "Everything is going
according to plan," Deputy CEO Apotheker says of the A1S development,
which cost SAP $69 million in the first half of 2007 (see
BusinessWeek.com, 5/16/07, "SAP's Tough Guy Ready to Rumble").



SAP continues to dominate the market for enterprise software. According
to company figures, SAP built its share of the $48 billion market for
so-called core enterprise applications to 26% in the last quarter from
23% a year earlier, compared with 15.5% for Oracle and 3.1% for
Microsoft. "They are a very good engineering company," Sholler allows.


And SAP has other growth areas. For example, Asia has become SAP's
fastest-growing region, with sales rising 20% in the second quarter to
$417 million, or 12.5% of total sales. India also is seeing
particularly good growth, Apotheker says, as companies there strive to
become as well-managed as their international peers. "They have high
ambitions for the future," he says.


Still, in a sign of caution, SAP executives did not raise their
forecast for the full year, despite the unexpectedly strong quarter.
"It's realistic guidance," Apotheker says, adding, "We feel we can
continue to perform very well."




Ewing is BusinessWeek's European regional editor.


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Why Nokia Is Leaving Moto in the Dust


Phones for high- and low-end consumers, a great supply chain, and lots
of cash—the Finnish company has it all (except the iPhone)



Pop singer Alicia Keys and Ramkishen Pyarelal, proprieter of a Mumbai
tea stall, may not have a lot in common. But they both carry Nokia
mobile phones. If you want to know why Motorola (MOT) is in such trouble these days, the celebrity and the Indian street merchant provide a big part of the answer.



From stylish $750 handsets with built-in global-positioning receivers to $45 basic models with black-and-white displays, Nokia (NOK)
saturates the booming mobile-phone market in a way neither Moto nor any
other competitor has been able to duplicate. Nokia's formidable lineup
of some 100 models is just one of many reasons why more than one out of
every three handsets in the world traces its origins to the Helsinki
suburb of Espoo.


The former producer of rubber boots and timber, which famously made
a risky decision in 1992 to focus on mobile technology, seems to be
doing everything right these days. Nokia's supply-chain management may
be the best of any company in the world. It has a big head start in
fast-growing markets such as China and India. And it has $9.5 billion
in cash and practically no debt, so it can invest far more than rivals
on developing new products or conquering new markets—and thus
build even more intimidating economies of scale. "We are about to
report our billionth customer, so we must be doing something right,"
says Anssi Vanjoki, a Nokia executive committee member responsible for
multimedia devices.


Shock-Resistant


Thanks to those advantages, Nokia's global market share has climbed
to 37%, and some in the industry think it could hit 40% this year. "If
there's a time when that goal looks realistic, it's now," says Gartner (IT) analyst Carolina Milanesi.



Motorola managers can take some comfort in recalling that Nokia, too,
has endured some devastating crises. Back in 1995, its manufacturing
system nearly collapsed under the weight of rapid growth. And in 2003,
Nokia was slow to introduce clamshell-style phones and color displays.
From the fourth quarter of 2003 to the first quarter of 2004, its
market share plunged from 34.6% to 28.4%, according to market watcher Strategy Analytics.



Similar woes have driven other mobile-phone producers from the market. Onetime contenders such as Panasonic (MC), Philips (PHG), and Siemens (SI) (which later sold its phone division to Taiwan's BenQ)
today have market shares below 1% each. But under former Chief
Executive Officer Jorma Ollila and his successor, Olli-Pekka Kallasvuo,
the stoic Finns emerged even stronger. By diversifying its products and
its geographical reach, Nokia now seems far less vulnerable to shocks
than it was three years ago. "Nokia has definitely learned from that
experience," says Neil Mawston, an analyst with Strategy Analytics.
"They have spread their risk a lot more."


All Things to All Consumers


One lesson Nokia learned was that it doesn't pay to rely too heavily
on a few top-selling models. Motorola, by contrast, became overly
dependent on the Razr. Nokia has nailed both the high and low ends of
the market and pretty much everything in between. For affluent buyers
who want the latest technology, the $750 top-of-the-line N95 includes
an Internet browser, music player, GPS satellite receiver, and the
ability to connect to Wi-Fi networks as well as standard cellular
services.


Even Nokia's entry-level phones offer extras that appeal to Mumbai
tea sellers and vast numbers of other low-income people enjoying their
first taste of telecommunications.


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Disney's Wish Upon a CD


Its music label is offering a new gadget called CDVU+ with loads of
interactive features. But can it draw buyers while CD sales continue to
fall?



Compact disc sales are plummeting, but Disney (DIS)
is making what may be a last-ditch effort to buck the trend. Disney's
Hollywood Records label introduced a version of CDs, dubbed CDVU+
(pronounced "CD view plus"), that include such interactive features as
videos and high-resolution photos embedded in a digital magazine
format. "We don't think the CD is dead," Hollywood Records General
Manager Abbey Konowitch said at a press event July 18. "We decided to
enhance the consumer experience rather than run from the format."


Many consumers are doing just that. In the first six months of 2007,
CD sales dropped 19.3% to 205.7 million from a year earlier, according
to Nielsen SoundScan, while digital album sales from such stores as
Apple's (AAPL) iTunes and RealNetworks' (RNWS) Rhapsody, jumped 60% to 23.5 million.



Executives at Hollywood Records, which represents artists as Hilary
Duff and Jesse McCartney, view those numbers through a
glass-is-half-full lens. That about 90 % of albums are still sold as
CDs is a good-enough reason to invest in the format, Konowitch and
colleagues reckon. And though the technology behind CDVU+ is not
new—artists frequently include special features on standard
CDs—Hollywood Records will use CDVU to include a higher degree of
content fans can't get elsewhere.


Holiday Hopes


The first CDVU+ release will be the upcoming album by tweenie bopper
band The Jonas Brothers, in stores on Aug. 7. The Jonas Brothers have a
big following on the Internet and among younger audiences—so the
band is considered a good test case for CDVU. "We're confident it's
going to be a very robust seller for the holiday season," Hollywood
Records Senior Vice President of Marketing Ken Bunt said. He declined
to make a sales forecast.



Dress up CDs all you want, but you won't be able to reverse the CD sales trend, says Forrester Research (FORR)
analyst James McQuivey. "We are very far away from being able to
persuade people to go back to CD," he says. John Barrett, director of
research at consumer researcher Parks Associates, adds that a limited
number of consumers will really take advantage of the added content.
"It's all a way to tip the scales in your direction, but there's
probably only so many artists that people want to watch that stuff
for," he said. "Your mother is not going to take a CD home and pop into
a computer and watch the music video."


What's a record label to do? McQuivey says fans want the extra
content, and they want it online. Companies can get it out there
without giving away the store, he says, by weaving it into widgets,
those small, transferable software applications that can be embedded in
Web sites like Facebook and News Corp's (NWS) MySpace (see BusinessWeek.com, 7/23/07, "The Next Small Thing").
Labels can use widgets to generate ad revenue, keep tabs on fans' Web
behavior, or goose sales of digital records—strategies likely to
prove more valuable than CD sales in the long run.




Chris Megerian is an intern at BusinessWeek. He is a rising senior at Emory University, where he co-majors in journalism and international studies.


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A Web Phone Called ooma


With its quirky version of Internet phone calls, a startup hopes to succeed in a business where others have failed



The secret that was "ooma" is out. Over the past few years, the stealth
startup had managed to raise $27 million in funding from Silicon Valley
heavyweights like Draper Fisher Jurvetson and The Founders Fund—all without divulging what product or service it was developing.



And so the innovative new concept behind the hush-hush is…an Internet phone?



Ooma, whose name is meant to evoke simplicity and approachability,
announced July 19 that its first product is a new device for Web-based
calling. Starting this fall, ooma plans to compete head-on with the likes of Vonage (VG) and eBay's (EBAY) Skype, not to mention traditional phone and cable TV companies such as Verizon (VZ), Comcast (CMCSA), and AT&T (T).


Free Service for Life



The timing of the announcement is rather striking, coming just days
after an online phone company named SunRocket flamed out of business.
And that's not the only sign of darkness hanging over the business of
providing phone calls using the technology known as Voice-over-Internet
protocol, or VoIP. The longtime VoIP leader, Vonage, has seen its
subscriber growth stumble, a slowdown that began even before the
company's future was cast into doubt by a courtroom defeat in a patent
dispute with Verizon (see BusinessWeek.com, 5/11/07, "Vonage Calls with Encouragement"). Vonage's customer base grew just 7% in the first quarter, compared with a 26% gain a year earlier.



To enter such a market now sounds a bit counterintuitive. Profits are
elusive, as pure-play Internet phone providers are forced to compete on
price against attractive bundles of phone, TV, and Internet service
from the established phone and cable companies. And competition from
wireless carriers, which are integrating cell phones with VoIP-based
capabilities in the home, is on the rise as well (see BusinessWeek.com,
6/27/07, "T-Mobile's Triple Threat").



And yet, here's ooma, expecting customers to hand over $399 up-front
for its device (most VoIP services provide equipment for free and
charge a $25 monthly service fee). The pitch? Free unlimited phone
service for life on all calls within the U.S. (Ooma says it will charge
low, Skype-like, per-minute rates for international calls.)


Capitalizing on Rivals' Woes?


A great deal for sure, presuming ooma can guarantee it will survive
a lifetime. After all, roughly 200,000 SunRocket users paid up-front
for a great deal, and now they're out hundreds of dollars, looking for
new phone companies. "People are going to be leery of prepaying for
phone service after the SunRocket debacle," says Stephan Beckert, an
analyst with consultancy TeleGeography.



But ooma may be betting the industry's woes will have exactly the
opposite effect. "Vonage and SunRocket have come onto hard times, and
you have subscribers looking for alternative services," says Patrick
Monaghan, an analyst with consultancy the Yankee Group,
which estimates the market for pure-play VoIP services will grow from
2.8 million subscribers at the end of 2006 to 6.4 million at the end of
2011.


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eBay Tries, Wall Street Shrugs


The e-commerce giant's latest results affirm its need to reinvigorate shopping on its core sites as it moves into new businesses



Yet shares slumped in extended trading after the results were released, by 1.7%, to $33.46. What gives? Even though more eBay (EBAY)
visitors are buying on the site and paying higher prices for goods, new
item listings on eBay's core shopping site declined 6%, to 559 million,
from a year earlier. That reinvigorated concern that sellers are
ditching eBay to sell elsewhere, such as through their own storefronts
or on competing sites such as Amazon.com (AMZN).
If listings growth continues to decline on eBay.com, some analysts warn
that eBay's high-performing payments business PayPal, which receives
60% of its business from eBay's shopping sites, will suffer as well
(see BusinessWeek.com, 6/15/07, "The Bank of PayPal").


New Home Page Coming



In a note to investors prior to eBay's earnings call, Cantor Fitzgerald
analyst Derek Brown articulated these concerns. He cites the declining
value of the total merchandise sold on eBay's core shopping sites,
which generate roughly 75% of eBay's net revenues, as reason for
investors to sell the stock. "We have little confidence that eBay has
fundamentally altered the tone and trajectory of its business," he
wrote.


It's not for lack of trying. In the past three months, eBay began
introducing a redesign aimed at improving search results on its core
shopping site, spent roughly $75 million to buy popular recommendation
service StumbleUpon, took steps to spread eBay's shopping platform
across the Web, and debuted a U.S. version of its classified
advertising site Kijiji, to name a few changes. More overhaul is on the
way. "There are more product changes coming in the next six months than
have occurred in the past few years at eBay," says Chief Executive
Officer Margaret C. "Meg" Whitman.



Yet Whitman acknowledges that many of the changes, intended to
reinvigorate the company's mature shopping sites in the U.S. and
Germany, are too recent to have had significant effect on the company's
bottom line. "It's probably a little early," she says in an interview,
adding that accelerating the total value growth of seller listings in
the U.S. and Germany is her "No. 1 priority."


Among the new features, the redesign includes a soon-to-be unveiled
new home page. The company has also launched new tools enabling sellers
to bid on multiple similar items at once without worrying about
actually winning each auction and "widgets" that let shoppers browse
eBay auctions from elsewhere on the Web, such as a blog, social network
page, or a network-linked desktop (see BusinessWeek.com, 6/18/07, "Going, Going…Everywhere"). "The growth rate in the U.S. and Germany are still quite good; however, neither is where we think they can be," says Whitman.


Marketing Blitz



To spur greater revenue growth from its core business, eBay plans to
launch a large marketing campaign in the fall touting the eBay shopping
experience. Hints of what the campaign will look like can be seen in
eBay's "windorphins" ads, which Whitman called a grassroots teaser
campaign aimed at generating excitement for winning auctions and the
eBay brand before the launch of the full advertising push.


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Clearwire and Sprint: Racing Ahead


Investors cheered a planned partnership that will result in the first
nationwide broadband network using WiMax. Does it presage a deeper
union?



Shares of Clearwire, a provider of wireless Internet access, surged on
news that it's pairing with Sprint Nextel to create a nationwide
network designed to provide mobile Internet access at faster speeds
than typically available now.


The fruit of their cooperation will be the first coast-to-coast
network providing broadband using WiMAX, a technology related to Wi-Fi
with a wide-reaching signal so that users need not keep close to a
hotspot at home or in a coffee shop to stay connected (see
BusinessWeek.com, 7/11/07, "Will Mobile WiMAX Crack Fortress Europe?"). The companies plan to market mobile WiMAX services under a common service brand.



Sprint Nextel (S) and Clearwire (CLWR)
had been planning separate WiMAX systems, but they say combining forces
will let them build a network more quickly and cheaply. "Our joint
efforts will result in customers benefiting from a more extensive
network, operating sooner, and using our respective spectrum more
efficiently than either company could have on its own," Clearwire Chief
Executive Officer Ben Wolff said in a statement.


First Step Toward a a Buyout?



UBS (UBSN)
analyst John Hodulik writes in a research note, "While the agreement
has a bigger impact on Clearwire, we believe it is likely to be
positive for both companies."


Another analyst suggests the partnership could be the first step
toward a buyout of Clearwire, which was founded in 2003 by Craig
McCaw—a wireless entrepreneur who spearheaded the creation of the
first nationwide cell-phone network two decades ago, then sold it for
billions to AT&T (T).



"We view the deal as a precursor to an eventual combination of the two companies," Jonathan Schildkraut of Jefferies & Co. wrote in an update to clients.



Clearwire shares, only recently recovered from a sharp decline after
the company went public in March, leaped 21% to $30.15 after the Sprint
Nextel deal was announced July 19. Shares of the Kirkland (Wash.)
company began trading at $25 on Mar. 8, when Clearwire raised $600
million in an initial public offering. By mid-April, the stock had slid
below $16. The stock then rebounded, eventually recovering all the lost
ground in June after announcing a deal to offer its Internet service to
customers of satellite-TV providers DirecTV (DTV) and EchoStar (DISH) (see BusinessWeek.com, 6/14/07, "Satellite Deals Send Clearwire into Orbit").


Built Separately, Joined Together



Shares of Sprint Nextel drew a more modest lift from the Clearwire
deal, rising 0.7% to $22.31, a signal it may take more than a faster
WiMAX deployment to alter the fortunes of a company buffeted by
customer defections, declining revenue, and financial losses (see
BusinessWeek.com, 10/11/06, "Is Time Running Out for Sprint's Forsee?").



Still, the partnership lets both companies reduce expenses for what is
expected to be a costly investment. Sprint Nextel, which plans to offer
mobile WiMAX to 185 million people, initially estimated in 2006 it
would spend $4 billion on its network. The company did not publicly
quantify the potential savings from the new partnership. Clearwire
plans to concentrate on regions where about 115 million people live. By
the end of 2008, coverage will reach 100 million people.


The deal calls for the companies to build their respective portions
of the nationwide network and then enable roaming for one another's
customers. To optimize their resources, they also intend to exchange
spectrum licenses to use the airwaves in certain markets.




Giles is editor of the Technology channel on BusinessWeek.com.


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The High Cost Of Wooing Google

States and cities are dangling ever-bigger
inducements to attract companies, and the digital giant knows how to
drive a hard bargain
Lenoir at first seems
an unlikely place for a high-tech outpost of the hottest brand on the
Web. Nestled beneath the Blue Ridge Mountains of western North Carolina
and a two-hour drive from the nearest commercial airport, the quiet
town and its neighboring communities have reeled from the closure of
seven furniture factories and the loss of more than 2,100 jobs in the
past three years. But down-on-its-luck Lenoir has just about everything
mighty Google Inc. (GOOG
) wants.
The digital titan,
based in Mountain View, Calif., has been hunting for places to plant
new server farms: vast, immaculate warehouses filled with row upon row
of computers that allow Google to offer faster online searches and
advertisements. Lenoir (pronounced like the woman's name Lenore) boasts
resources at the top of Google's list: cheap, abundant electricity;
excess water capacity to keep the computers cool; and lots of
inexpensive land.


Just as Google has pushed the boundaries of its Internet business, it
plays the real estate game aggressively. Beginning with an anonymous
approach in late 2005, the company elicited a stream of promises from
local and state officials in North Carolina, all frantic to lure a
major tech company, even before they knew which one. During months of
negotiations over Google's shifting requirements, the company never
failed to remind those officials that it could go elsewhere. In the
end, the North Carolinians agreed to a package of tax breaks,
infrastructure upgrades, and other goodies valued at $212 million over
30 years, or more than $1million for each of the 210 jobs Google said
it eventually hoped to create in Lenoir.


Some felt bullied. "It's simply unconscionable from an ethics
standpoint for this company to go in from this very unfair bargaining
position," says Robert F. Orr, a former North Carolina Supreme Court
justice running for governor. "These are business decisions by the
smartest businesspeople in the world, and it's just exploiting a
desperate town."


But that's not the majority view in Lenoir. Most see Google's arrival
as a vital morale booster, if not a full replacement for the lost
furniture factories. "I would have voted for a 100% tax incentive if
that's what it would have taken to land them," says Herbert H. Greene,
a commissioner of Caldwell County, of which Lenoir is the seat.





THE SPOILS OF BIDDING WARS
Business-development incentives,
while hardly new, are proliferating as never before, and the dollar
values are soaring. Lenoir's courting of Google offers a case study of
how elaborate the inducement ritual can get. Today it's not just
carmakers promising thousands of jobs apiece that are getting rich
deals. From New York to Washington State, IT, biotech, and
financial-services companies have incited frenzied bidding for their
business and the spirit-elevating buzz they bring. States and
localities bruised by globalization view these knowledge-based fields
as the foundation for economic rebuilding. Reliable current estimates
of the number of deals don't exist, but those who study the field all
agree that the total is rising. Peter S. Fisher, a professor of urban
and regional planning at the University of Iowa, pegs the aggregate
value of incentives at about $50 billion a year.

Competitive
anxiety compels the handouts: the fear that without lucrative
enticements, companies will go elsewhere. And the bidding war is being
escalated further by sophisticated corporate consultants expert at
playing jurisdictions against each other and deploying databases that
allow companies to compare the baubles offered by various suitors.


All of these factors came into play in Lenoir, population 17,000. It's
a place that clings to tradition: Wednesday night outdoor movies in the
main square, a blackberry festival each July, and a Civil War battle
reenactment in August. But the world is changing, and Lenoir has been
devastated by the departure to China of its core business, the
manufacturing of bedroom sets.


Just two miles from downtown sits Bernhardt Furniture, one of the
largest local employers, whose payroll has shrunk by half, to 3,000, in
recent years. From the window of CEO G. Alex Bernhardt's office, you
can see the shuttered factories. Two belong to his company; the other
five, to friends and competitors. In 2000 the unemployment rate in
Caldwell County was less than 2%; by 2005 it had hit 13%. Today it's
7.3%, three percentage points above the national average. "When our
globalization came," says Bernhardt, "it came with lightning speed."


That's why the town fathers reacted with nervous excitement when they
learned in December, 2005, that a major tech company was shopping for a
place to build a big new facility. The first of many auditions came two
weeks before Christmas, when Caldwell's Economic Development Commission
sent two representatives south to Charlotte to pitch Rhett L. Weiss.
Google's top site negotiator, Weiss didn't identify himself as a
company employee. In fact, it would be months before Google's name
surfaced in North Carolina. At that first meeting, Weiss handed out
business cards from Dealtek Ltd., the Los Altos (Calif.) consultancy he
founded in 1999 and has continued to run, though at a scaled-back pace,
since joining Google in 2005.





"PROCESS OF SURVIVAL"
If any one person embodies the boom in
business-incentive deals, it's Weiss, 46, a lawyer by training who
wears button-down shirts, khaki pants, and wire-rim glasses. After
working for Big Four accounting firm KPMG, he opened Dealtek to focus
on corporate site selection. The firm advises both migrating companies
and localities seeking new business. It is one of about 200 firms that
sell such services and have national reach. Dealtek tries to
differentiate itself in an increasingly crowded field by selling
software--"a consultancy's proverbial 'Black Box,'" the firm calls
it--which compares competing site-selection opportunities.

The
Lenoir offer certainly had much to recommend it. Electricity, for one
thing, costs only 4.5 cents to 5 cents per kilowatt-hour on average in
North Carolina, vs. 6 cents to 11 cents in some comparable locales.
With furniture makers gone or downsized, there was excess capacity.
Duke Energy Co. (DUK
), the utility hoping to sell the cheap power, hosted the introductory session in Charlotte.


Weiss gave half an hour each to three North Carolina counties that day
and was done before noon. "This is a process of survival," says Alan
Wood, senior development manager for the Caldwell County Economic
Development Commission. "They look for reasons to eliminate sites."
Wood had first met Weiss the previous April at MerleFest, a bluegrass
festival in Wilkesboro, N.C. Local business-development scouts use the
musical gathering as a chance to mingle with consultants like Weiss,
who come at their invitation. Explaining that he hadn't given Weiss a
hard sell at the festival, Wood says: "You don't usually ask someone to
marry you on the first date."


Three months later, after touring North Carolina in a plane supplied by
the state's Commerce Dept., Weiss asked a roomful of people from Lenoir
gathered in a meeting room in Raleigh whether anyone could guess the
corporation for which he worked. One tentatively suggested Google. When
Weiss, smiling, confirmed it, Lenoir Mayor David W. Barlow recalls
thinking: "There's no way in the world this will ever happen." Google's
size and success seemed beyond the town's grasp.


But Weiss was serious, requiring everyone in the town and county who
knew Google's identity to sign confidentiality agreements so rival
companies wouldn't learn that Google was on the prowl. During
negotiations over the next 10 months, Weiss combined a calm demeanor
with an obsessive attention to detail, never committing Google to
building in Lenoir. "He plays a good game of poker as well, I'm sure,"
says Barlow.


Despite his doubts, Barlow threw himself into the competition. A
Realtor and part-owner of a car dealership, the mayor is married to a
retired schoolteacher and lives doors away from their children and
grandchildren. He saw the possibility of Google's arrival as a way to
restore civic self-respect. "I didn't think there would be a lot of
[economic] spin-off value," he admits. "Psychologically, the impact of
this for our community would be greater than the reality." Google never
formalized its suggestion that it might one day employ 210 people in
Lenoir; nor did the company say how many jobs might go to locals, as
opposed to computer techs Google would bring in.





EXPANDING WISH LIST
To keep Weiss interested, the Lenoir City
Council voted in closed session on Mar. 21, 2006, to expand the tax
incentives then on the table. An initial offer of 100% off local
property taxes and 75% off real estate taxes, both for 15 years, grew
to 100% and 80%, respectively, for 30 years. Fine, said Weiss, but
there were other issues.

When negotiations began, he had seemed
satisfied with a 127-acre site that includes a former lumberyard. Now
he demanded more. In March, Mayor Barlow and a fellow Realtor began to
piece together a larger plot. Nights and weekends they knocked on
doors, asking people to sell. One parcel was owned by 57 heirs,
including a long-estranged couple. As part of the deal, the county paid
for their divorce. "I never, ever thought this was going to work," says
Barlow. He cobbled together a total of 216 acres out of 51 parcels. He
took no commissions.


There wasn't much time to celebrate the real estate coup, because by
June the deal seemed to be falling apart on another front. In Raleigh,
the state legislature was working on a Google-driven bill that would
exempt server farms from sales tax on the copious electricity they use.
On June 13, Weiss sent an e-mail to Jim Fain, the state's commerce
secretary, complaining that the legislation "has remained cursed with
unfortunate and petty dickering from the legislative drafting
side--mainly refusing to reinsert better word choice." If North
Carolina didn't quickly enact "sales tax exemptions that make it
competitive with other states in which the project could locate, the
project simply will not come to North Carolina," Weiss wrote. He
continued to let officials know he was talking to several other states,
including South Carolina and New York, according to documents and
interviews. The legislation passed in July.


Amazingly, Google's interest in coming to North Carolina surfaced in
the press only once, in an article on July 21, in Charlotte's News
& Observer. Weiss hit the roof over what he saw as a breach of
confidentiality, according to e-mail and interviews. Fain himself
mollified Weiss during a previously scheduled encounter at a McDonald's
(MCD
) on Interstate 95, where the commerce secretary met Weiss, his wife,
and four children, who were finishing a vacation at the North Carolina
shore.


One of the final issues, negotiated through the fall and into December,
was water. Afraid that Google's plan would drain Lenoir's water
capacity, Mayor Barlow wanted Google to commit to staying in town long
enough to justify a $24 million municipal upgrade. Several times,
locals thought the deal would die over this point, though Weiss says he
didn't think so. In the end, Google agreed to pay $1.05 million toward
the water expansion, but it never locked itself into operating in
Lenoir for a minimum period.


In an interview, Weiss explains that the company's changing demands
reflected evolving technological requirements and experiences at other
company computer facilities. Google, he adds, will help the struggling
town. The large construction project will provide temporary employment
and produce tax revenue on building materials. In addition to helping
pay for the municipal water upgrade and the closure of a rail line on
its land, the company has offered to reimburse local expenses related
to the long negotiations, he says. (One memo puts those costs at more
than $300,000.)


Rather than focus on Google's expected annual tax rebate of $5.87
million on a bill of $6 million, Weiss points out that what the city
will collect--some $130,000--is a lot more than what it received on the
property before the company's improvements. All told, Google plans to
invest $600 million in the Lenoir server farm.


Since the company's plans in Lenoir were announced in January, Weiss
has struck similar deals for new computer centers in South Carolina,
Oklahoma, and Iowa. Google won't say how many server farms it operates
nationwide.


In Lenoir, some residents still resent the tactics used by the
out-of-town technology giant. "There were 18 or 20 drafts of contracts,
a lot of ticky-tacky stuff," says T.J. Rohr, an attorney and member of
Lenoir's city council. "And a lot of the time it seemed like they were
saying, 'It's our way or the highway.'"


But Rohr was the only member of the seven-person council to vote
against the final deal. Mayor Barlow says the important thing "is that
we were selected, and we have something to offer." Google, he adds,
"put us on the map."


The Google site in Lenoir now bustles with tractors, bulldozers, and
contract workers. A large silver-roofed building is going up behind
fencing, a retaining wall, and a 200-foot buffer of trees. Visitors
aren't allowed. As of early July, Google had hired one full-time
employee: a site manager who came from out of town.


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eBay Tries, Wall Street Shrugs


The e-commerce giant's latest results affirm its need to reinvigorate shopping on its core sites as it moves into new businesses



Second-quarter results for eBay were met by a tough crowd. For many
companies, results such as the ones eBay posted July 18 would be an
impressive set of figures. The online commerce giant said profit surged
50%, to $375.8 million, on a 30% jump in revenue. Per share earnings
were 27 cents, beating eBay's forecast by a penny, and the company
raised the low end of its forecast for 2007 sales by $100 million. It
now expects revenue of $7.3 billion to $7.45 billion.



Yet shares slumped in extended trading after the results were released, by 1.7%, to $33.46. What gives? Even though more eBay (EBAY)
visitors are buying on the site and paying higher prices for goods, new
item listings on eBay's core shopping site declined 6%, to 559 million,
from a year earlier. That reinvigorated concern that sellers are
ditching eBay to sell elsewhere, such as through their own storefronts
or on competing sites such as Amazon.com (AMZN).
If listings growth continues to decline on eBay.com, some analysts warn
that eBay's high-performing payments business PayPal, which receives
60% of its business from eBay's shopping sites, will suffer as well
(see BusinessWeek.com, 6/15/07, "The Bank of PayPal").


New Home Page Coming



In a note to investors prior to eBay's earnings call, Cantor Fitzgerald
analyst Derek Brown articulated these concerns. He cites the declining
value of the total merchandise sold on eBay's core shopping sites,
which generate roughly 75% of eBay's net revenues, as reason for
investors to sell the stock. "We have little confidence that eBay has
fundamentally altered the tone and trajectory of its business," he
wrote.


It's not for lack of trying. In the past three months, eBay began
introducing a redesign aimed at improving search results on its core
shopping site, spent roughly $75 million to buy popular recommendation
service StumbleUpon, took steps to spread eBay's shopping platform
across the Web, and debuted a U.S. version of its classified
advertising site Kijiji, to name a few changes. More overhaul is on the
way. "There are more product changes coming in the next six months than
have occurred in the past few years at eBay," says Chief Executive
Officer Margaret C. "Meg" Whitman.



Yet Whitman acknowledges that many of the changes, intended to
reinvigorate the company's mature shopping sites in the U.S. and
Germany, are too recent to have had significant effect on the company's
bottom line. "It's probably a little early," she says in an interview,
adding that accelerating the total value growth of seller listings in
the U.S. and Germany is her "No. 1 priority."


Among the new features, the redesign includes a soon-to-be unveiled
new home page. The company has also launched new tools enabling sellers
to bid on multiple similar items at once without worrying about
actually winning each auction and "widgets" that let shoppers browse
eBay auctions from elsewhere on the Web, such as a blog, social network
page, or a network-linked desktop (see BusinessWeek.com, 6/18/07, "Going, Going…Everywhere"). "The growth rate in the U.S. and Germany are still quite good; however, neither is where we think they can be," says Whitman.


Marketing Blitz



To spur greater revenue growth from its core business, eBay plans to
launch a large marketing campaign in the fall touting the eBay shopping
experience. Hints of what the campaign will look like can be seen in
eBay's "windorphins" ads, which Whitman called a grassroots teaser
campaign aimed at generating excitement for winning auctions and the
eBay brand before the launch of the full advertising push.


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Distributed by Hasan Shrek, independence blogger. Also run online business , matrix, internet marketing solution , online store script .
Beside he is writing some others blogs for notebook computer , computer training , computer software and personal computer

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