Wednesday, August 24, 2011

What TouchPad's Fate Says About the Tablet Market

GigaOm August 22, 2011, 10:13 PM EDT

What TouchPad's Fate Says About the Tablet Market

Given Apple's early iPad launch, only a well-executed, budget-priced, basic tablet backed by deep, committed pockets is likely to fare well—as in Amazon's likely entry

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I missed last week’s big news of Hewlett-Packard (HPQ) opting to terminate the TouchPad and other webOS hardware by only a few hours. My issue was one of timing: About two hours before HP’s bombshell revelations—the company is also looking to exit the PC market, where it holds the global No. 1 spot—I fell ill and took a few days off to recoup. It turned out that timing also provides a central explanation both for the demise of the TouchPad and for my conviction that Apple (AAPL) has positioned its iPad very well for years to come against challengers in the tablet market.
I hit upon the issue of timing earlier this month in a GigaOM Pro article (subscription required) noting that Apple’s iPad was announced in January 2010 and that so far, no tablet has caught up to what Apple offers. Plenty of folks are happy with a Google (GOOG) Android Honeycomb tablet; fewer have purchased a BlackBerry (RIMM) Playbook. I’m not suggesting that Apple’s iPad is the best tablet for everyone. Consumers have different needs and preferences. From an overall sales perspective, though, no data dispute that Apple holds the tablet crown.
How else does timing affect the overall tablet market as well as HP’s decision to table the TouchPad?
• Consumers aren’t buying devices for potential. For most people, the iPad is the most complete tablet available. Why? Out of the box at launch it had strong third-party app support, as well as backward compatibility with phone apps, a media store, and an operating system interface that tens of millions were already used to. It took more than a year before the earliest tablet contenders appeared and they’re just now gaining certain key features: movie stores, for example, and stretch and zoom capabilities for phone apps. Consumers want a complete tablet experience, not one that’s “coming soon.”
• If tablets are the future, companies must commit for the long haul. HP’s $1.2 billion investment in webOS persuaded me that it was in the tablet race for the long haul. I defended the company’s move to sell the TouchPad at a discount and even bought one, only to find out days later that I was wrong: HP wasn’t selling the tablet at low prices to expand the user base quickly and help attract developers. HP apparently gave the TouchPad only a brief chance to gain an audience. When it didn’t do this at full price, the product’s plug was swiftly pulled. Research In Motion and the many Android tablet makers should take note. To compete with the iPad, they must be prepared to invest much time and money.
• When a product comes to market is nearly as important as the product itself. The tablet landscape might be very different if all the iPad competitors had arrived a year ago. I still believe, for example, that webOS offers a smart and effective user interface. Had HP been able to deliver the TouchPad last summer, it might have captured the No. 2 tablet spot by now. Instead, Apple’s iPad has the mindshare of developers, consumers, and enterprises. In lieu of viable tablet alternatives, Apple gained valuable market share. At this point, hardware makers are setting themselves up only for strict comparisons to iPads already in use.
• Timing is key to partner strategies. It’s easy to look back in hindsight. Clearly, HP should have lined up a hardware partner to license webOS before announcing the demise of the TouchPad. At this point, the lack of a hardware partner makes webOS software look like a dead product to many consumers and developers. The webOS asset looks like a liability: Who will take the chance to create hardware by licensing the platform now? Had a partner been announced first, the future of webOS on a tablet might show promise. Instead, it looks like a big risk that has already failed to pay off for two different companies—HP and Palm

FULL STORY AT http://www.businessweek.com/technology/what-touchpads-fate-says-about-the-tablet-market-08222011.html
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Behind Five Guys’ Beloved Burgers

Restaurant Chain August 11, 2011, 10:00 PM EDT

Behind Five Guys’ Beloved Burgers

Carnivores keep coming back for the authentic vibe as much as the beef, but maintaining it throughout the franchise is no simple task

Five Guys says last year it used enough peanut oil to fill the stream of the Jungle Cruise ride at Disneyland Five Guys says last year it used enough peanut oil to fill the stream of the Jungle Cruise ride at Disneyland Brian Finke for Bloomberg Businessweek
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http://images.businessweek.com/cms/2011-08-11/pop02_fiveguys34__01__190.jpg Sales growth Brian Finke for Bloomberg Businessweek; ; Nation's Restaurant News Top 100; U.S. data, may reflect actual results, estimates or projections.

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Jerry Murrell bursts through the swinging glass doors of a hamburger restaurant at a shopping center in suburban Virginia. Van Morrison is rocking through the speakers, and line cooks are shouting orders across the open kitchen. Murrell, 67, who is tall with sporty sunglasses perched atop his bald head, enters as if he owns the place, which he does. The founder and chief executive officer of the Five Guys burger chain approaches the counter, takes his place in line, and makes a show of slipping a crisp $100 bill into the tip jar.
Murrell passes up Five Guys’ regular cheeseburger, which comes with two patties and 840 gluttonous calories, and orders the “Little Burger”—a single patty with lettuce and tomatoes. No cheese or jalapeños, no mushrooms or any of the other 11 free toppings. Not even ketchup. Though he’s proud of the offerings, chosen by his sons who help run the business—“Every little one was a decision,” Murrell says. Today he keeps it simple.
What started as a modest burger shack in a Virginia strip mall has exploded into America’s fastest-growing restaurant chain, with five stores opening each week. Five Guys serves up made-to-order burgers with beef that’s never frozen and absurdly large servings of hand-cut fries. The fresh, generous meals allow them to charge more than fast food chains such as McDonald’s and Burger King.
Murrell founded the company with his wife and sons in 1986. For 16 years they ran a handful of local stores in the Washington (D.C.) area, perfecting their limited menu and building a devout local following. Then in 2002, after much nudging, the boys convinced Murrell to open the floodgates to franchising. By the end of this year, Five Guys expects to have almost 1,000 stores open around the country and over $1 billion in sales. They’re growing so fast that the Murrells are racing to hold on to the simple, authentic vibe that made the place so beloved.

Five Guys stores don’t have drive-throughs or molded plastic seats bolted to the floor. The walls are covered in crisp white and red tiles, the kitchen is open for everyone to see, and the menu doesn’t change. As Jim Gilmore, the co-author of Authenticity: What Consumers Really Want, explains, Five Guys stores seem to say, in the most loving way possible, “Shut up, sit down, and eat.”
Gilmore says that in an age when everything seems to be mediated and staged, the tough love from Five Guys feels refreshingly real. The restaurants cultivate that through what Gilmore calls the “texture” of their operations. The stores typically have bags of potatoes stacked up to be cut into French fries—a holdover from early locations that didn’t have storage space in the kitchen. A chalkboard on the wall lists the specific farm that grew the spuds. Self-serve buckets of peanuts let customers munch as they wait for their orders, while employees are encouraged to be personable and avoid scripted greetings.
The Murrells also shun national advertising campaigns, which they find fake, and instead rely on word of mouth. When President Obama moved to the White House, a Five Guys staffer suggested sending him a T-shirt. “That’s cheap!” Murrell shot back. Playing coy worked, and soon Obama, trailed by TV cameras, stopped by a store. He ordered a cheeseburger with lettuce, tomato, fresh jalapeños, and mustard—a classic example of Five Guys’ formula that sells 2 million burgers a week and was named Zagat’s “best fast food burger” for 2010.
For this reporter, evaluating the burger first-hand was problematic: I’ve been a vegetarian for more than a dozen years. So I tried calling some expert tasters. Pulitzer Prize winning food critic Jonathan Gold says he doesn’t much care for Five Guys—he finds the burger “boring”—but understands why people like them. “There’s that goopeyness, and it does fit that kind of American profile.” Gilmore, the marketing consultant, calls the burgers “a couple pounds of carnivorous pleasure.” Then he adds, “It’s almost enough to make me feel sad for you.”


READ FULL STORY AT http://www.businessweek.com/magazine/behind-five-guys-beloved-burgers-08112011.html
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Text to Speech, on the iPad

Text to Speech, on the iPad

When his aunt lost the ability to talk, Ajay Godhwani built a text-to-speech app for the iPad that makes it easy to express complex thoughts

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Mathew Scott for Bloomberg Businessweek
In June 2010, after 40 years of teaching classical Indian music, Nirmala Godhwani lost her ability to speak. Four months earlier she’d been diagnosed with amyotrophic lateral sclerosis, or ALS, and while Godhwani’s mind remained sharp, her motor skills deteriorated quickly. She grew frustrated trying out the various technologies for converting typed words into speech. Most have interfaces that rely heavily on graphics, including stick figures, to help users of all ages, literacy levels, and mental capacities recognize words. The graphics slowed Nirmala down, however, and made it difficult for her to form complex sentences. Before long, her hope that she could continue having substantive conversations “had been beaten out of her by this brutal disease,” says Ajay Godhwani, Nirmala’s nephew.
Then a 35-year-old senior director at a technology consulting company, Godhwani decided, along with Nirmala’s two sons, to create something better. The result, an iPad app called Verbally, is a lesson in economy. Godhwani consulted with speech therapists and computational linguists and was surprised to learn that only “about 200 words in the English language make up about 80 percent of daily conversations,” he says. So rather than stick figures, Verbally users see text buttons on the top half of the screen and a keyboard on the bottom. One tab shows about 50 of the most common words in English; another, a list of common phrases. Users can choose one of the text buttons or start typing. The app employs predictive text technology to recommend complete words and phrases based on the first few letters typed. The idea is to squeeze more information on each screen and reduce the number of steps it takes to form a sentence.
Godhwani says his aunt, who died this February, found it far easier to communicate complex thoughts with the app. In March, Intuary—the San Francisco startup Godhwani founded to develop the technology—released a polished version as a free iPad app. It’s been downloaded nearly 30,000 times. In late July, the six-person company started selling a $100 premium version with more voice options and the ability to store personalized lists of words and phrases. Andrew Jinks, a speech pathologist with the Center for Assistive Technology at the University of Pittsburgh Medical Center, says Verbally is “tremendous” for a free product, though it’s not appropriate for every patient. “It’s certainly not going to work for them over the course of” a degenerative disease such as ALS, he says, as patients eventually lose the ability to manipulate a touchscreen.
Intuary, meanwhile, is expanding, and plans to release an educational app for children by the end of the year. Godhwani won’t give any details other than to say he wants the program to be as easy to use as Verbally, so just by “look[ing] at it, you know what to do.”

MOTIVATION

An aunt with ALS found text-to-speech programs too limiting.

INSIGHT

Most conversations rely on only about 200 common words.

CREATION

Verbally, a free iPad app that emphasizes efficiency.

Leiber is Small Business editor for Businessweek.com, Entrepreneurs editor for Bloomberg.com, and covers small business for Bloomberg Businessweek.
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How Nordstrom Bests Its Retail Rivals

Department Store August 11, 2011, 10:00 PM EDT

How Nordstrom Bests Its Retail Rivals

The family-run department store places customer service above all else with easy-to-market lifestyle sections

The Nordstroms of Nordstrom The Nordstroms of Nordstrom Jose Mandojana for Bloomberg Businessweek
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http://images.businessweek.com/cms/2011-08-10/pop14__nordstrom34__01__190.jpg Most popular items at Nordstrom for men and women Kareem Black for Bloomberg Businessweek

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At 10 a.m. on the morning of Apr. 8, the doors opened to the 116th Nordstrom (JWN) department store, at Christiana Mall in Newark, Del. A crowd‚ consisting mostly of smartly dressed women in their 30s and 40s, ran inside. There was screaming. They jogged through a gauntlet of more than 300 employees, and clapping along with all the store managers, salespeople, and security guards were four tall men. These were the Nordstroms of Nordstrom, brothers Blake W., Peter (Pete) E., and Erik B., and second cousin James (Jamie) F. Jr.
This was the 43rd new department store to open since the fourth generation of Nordstroms retook control of the company in 2000, a run that has had investors screaming, too, or at least looking over their portfolios with approval. Last year revenue at the company grew 12 percent, to a record $9.7 billion, and while the Great Recession slowed rivals Neiman Marcus and Saks (SKS), Nordstrom gained market share. Nordstrom, it seems, is that rarity in American business: an enterprise run by a founding family that hasn’t wrecked it.
There is no chief executive officer, though the board has an outside chairman: Enrique “Rick” Hernandez Jr. Where other family-run companies, such as the Dillard’s (DDS) department-store chain, employ two classes of stock that give the founders extra voting power, the extended Nordstrom family owns the same kind of paper as any other shareholder. They own $2.5 billion worth, or about one-quarter of the outstanding shares.
Nordstrom is expanding, though in a methodical and not too daring way. With room in the U.S. for about 14 more stores—there are a limited number of ritzy Zip Codes—it is taking the enterprise abroad, starting not with Asia or the Middle East but just across the border from its Seattle headquarters, in Canada. Unlike Saks and Bloomingdale’s, which have opened stores in Mexico and the United Arab Emirates, the Nordstroms have chosen not to franchise their foreign outposts. “We’re not trying to make a buck and move on to the next thing,” says Pete, 49. “This is our life. We do not want to be the generation who screws it up.”
For the most part, say industry observers, the Nordstroms have succeeded by making customer service the good they’re really selling. Though many retailers embrace “customer centricity,” a fancy term for putting the customer first, few equal Nordstrom, which routinely ranks in the top three on Luxury Institute surveys that measure customer satisfaction.
“Nordstrom’s claim to fame has been customer service,” says Richard Dickson, president of Jones Group, which owns Jones New York, Anne Klein, and other apparel brands. “They led the charge and to some extent invented” the concept, he says.
Nordstrom was founded in 1901, when John W. Nordstrom, a Swedish immigrant, invested his Alaska gold mine stake in a downtown Seattle shoe store with his partner, Carl F. Wallin. Nordstrom moved into women’s wear in the 1960s and soon after added men’s and children’s clothes. The third generation took over in 1968, and expansion picked up. By 1990, the year Nordstrom opened its first store in the New York City area, in Paramus, N.J., the company had 46 locations in seven states.
Where rivals define store space by brand, Nordstrom breaks it up into so-called lifestyle sections. The “Individualist” corner offers midpriced contemporary goods from Theory to Trina Turk, while the “Narrative” section features less costly but classic styles from labels such as Lauren by Ralph Lauren (RL) and AK Anne Klein.
Nordstrom’s approach makes it easier for shoppers to put together outfits, says Jennifer Black, a retail analyst who once worked at Nordstrom stores in Portland, Ore. Brands covet an invitation to win shelf space. Shoe entrepreneur Steve Madden recalls the first time he was asked to a Nordstrom buyer’s meeting. “It was like an invite to the White House,” he says


Full Story at http://www.businessweek.com/magazine/how-nordstrom-bests-its-retail-rivals-08112011.html
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A Rallying Cry in Israel: ‘Lower the Rent!’

A Rallying Cry in Israel: ‘Lower the Rent!’

Angry tenants pitch tents and demand social justice

Tent city in Tel Aviv: Housing prices are up 40 percent Tent city in Tel Aviv: Housing prices are up 40 percent Amnon Guman
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What started in mid-July as a minor protest—two dozen tents pitched in a posh section of Tel Aviv—has morphed into a full-blown citizen’s movement in Israel. The tent camps have spread to other choice avenues in Tel Aviv and cropped up in Jerusalem, Haifa, and Beersheba. More than 250,000 people filled the streets outside Israel’s Defense Ministry on Aug. 6 at a “Rally for Social Justice” replete with protest leaders and local rock stars.
At the heart of the movement is the anger of ordinary Israelis at the surging cost of housing. Prices have increased about 40 percent in the last three years, in part the result of Israel’s “very slow” planning and construction process, Bank of Israel Governor Stanley Fischer said on Aug. 1. They rose 13.7 percent in the 12 months through April-May, about triple the inflation rate, the Central Bureau of Statistics reported on July 15. Israel ranked fourth in the Knight Frank Global House Price Index for the first quarter of 2011, trailing only Hong Kong, India, and Taiwan.
Rents are jumping, too. “It is insane what landlords get away with charging in this country,” says Yifat Karlinsky, a pregnant mother of a 2-year-old boy, as she sits on a park bench near her tent, sweating in the August heat. “Tel Aviv has become a city only rich people can afford, and the lack of housing is driving prices up everywhere else.” Karlinsky, a 37-year-old grade school teacher, joined the protest after the rent on her south Tel Aviv apartment jumped 17 percent.
Why the fury over housing prices now? “In Israel demand [for housing] has often outstripped supply,” says HSBC (HBC) economist Jonathan Katz. “It’s been especially so the last few years, thanks to low interest rates making it easier to get housing loans and mortgages.” The economy has been robust—it should grow 4.8 percent this year, according to the Bank of Israel. The increased prosperity has made Israelis hunger for better homes, while at the same time the gulf between rich and poor has widened.
Israel’s real estate market has unique structural problems, too. As much as 93 percent of Israel’s land is owned or managed by the government, part of a policy dating to the nation’s founding in 1948 to preserve a Jewish state. That means most real estate sales are actually long-term leases, giving the state unusually large authority over land use.
The bureaucracy-heavy process that builders must go through to get projects cleared has slowed construction permits, constricting the supply of apartments and lifting prices in a country roughly the size of New Jersey. Among Prime Minister Benjamin Netanyahu’s responses to the housing protests has been a promise to cut red tape at the Israel Lands Administration, which handles the bidding for leases.
Netanyahu is painting himself as an ally in the struggle to build housing that middle-class families and students can afford. He has pledged to build 50,000 housing units in the next 18 months with incentives of free land for construction of low-rent apartments. Protest leaders are instead demanding immediate government steps to bring down rents and regulate housing prices.
Netanyahu may try something radical. In previous stints as Prime Minister and Finance Minister, he led the drive to sell government-owned businesses, including El Al Israel Airlines and Bezeq, the telecom company. Now he is trying to push through the sale of Israel’s ports and public land. If developers owned land outright, they theoretically could build much faster. In the meantime, a tent in Tel Aviv is the best deal going.
The bottom line: With housing prices up 40 percent in the last three years, Israelis are demanding a remedy. Selling off public land is one option.

Ferziger is a reporter for Bloomberg News. Ben-David is a reporter for Bloomberg News.
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Wall Street Aristocracy Got $1.2 Trillion in Secret Loans

Wall Street Aristocracy Got $1.2 Trillion in Secret Loans

August 22, 2011, 8:41 AM EDT
By Bradley Keoun and Phil Kuntz
(Adds Web site link. View the Bloomberg interactive bailout graphic here. For more Fed rescue coverage, see {EXT7 <GO>}.)
Aug. 22 (Bloomberg) -- Citigroup Inc. and Bank of America Corp. were the reigning champions of finance in 2006 as home prices peaked, leading the 10 biggest U.S. banks and brokerage firms to their best year ever with $104 billion of profits.
By 2008, the housing market’s collapse forced those companies to take more than six times as much, $669 billion, in emergency loans from the U.S. Federal Reserve. The loans dwarfed the $160 billion in public bailouts the top 10 got from the U.S. Treasury, yet until now the full amounts have remained secret.
Fed Chairman Ben S. Bernanke’s unprecedented effort to keep the economy from plunging into depression included lending banks and other companies as much as $1.2 trillion of public money, about the same amount U.S. homeowners currently owe on 6.5 million delinquent and foreclosed mortgages. The largest borrower, Morgan Stanley, got as much as $107.3 billion, while Citigroup took $99.5 billion and Bank of America $91.4 billion, according to a Bloomberg News compilation of data obtained through Freedom of Information Act requests, months of litigation and an act of Congress.
“These are all whopping numbers,” said Robert Litan, a former Justice Department official who in the 1990s served on a commission probing the causes of the savings and loan crisis. “You’re talking about the aristocracy of American finance going down the tubes without the federal money.”
(View the Bloomberg interactive graphic to chart the Fed’s financial bailout.)
Foreign Borrowers
It wasn’t just American finance. Almost half of the Fed’s top 30 borrowers, measured by peak balances, were European firms. They included Edinburgh-based Royal Bank of Scotland Plc, which took $84.5 billion, the most of any non-U.S. lender, and Zurich-based UBS AG, which got $77.2 billion. Germany’s Hypo Real Estate Holding AG borrowed $28.7 billion, an average of $21 million for each of its 1,366 employees.
The largest borrowers also included Dexia SA, Belgium’s biggest bank by assets, and Societe Generale SA, based in Paris, whose bond-insurance prices have surged in the past month as investors speculated that the spreading sovereign debt crisis in Europe might increase their chances of default.
The $1.2 trillion peak on Dec. 5, 2008 -- the combined outstanding balance under the seven programs tallied by Bloomberg -- was almost three times the size of the U.S. federal budget deficit that year and more than the total earnings of all federally insured banks in the U.S. for the decade through 2010, according to data compiled by Bloomberg.
Peak Balance
The balance was more than 25 times the Fed’s pre-crisis lending peak of $46 billion on Sept. 12, 2001, the day after terrorists attacked the World Trade Center in New York and the Pentagon. Denominated in $1 bills, the $1.2 trillion would fill 539 Olympic-size swimming pools.
The Fed has said it had “no credit losses” on any of the emergency programs, and a report by Federal Reserve Bank of New York staffers in February said the central bank netted $13 billion in interest and fee income from the programs from August 2007 through December 2009.
“We designed our broad-based emergency programs to both effectively stem the crisis and minimize the financial risks to the U.S. taxpayer,” said James Clouse, deputy director of the Fed’s division of monetary affairs in Washington. “Nearly all of our emergency-lending programs have been closed. We have incurred no losses and expect no losses.”
While the 18-month U.S. recession that ended in June 2009 after a 5.1 percent contraction in gross domestic product was nowhere near the four-year, 27 percent decline between August 1929 and March 1933, banks and the economy remain stressed.
Odds of Recession
The odds of another recession have climbed during the past six months, according to five of nine economists on the Business Cycle Dating Committee of the National Bureau of Economic Research, an academic panel that dates recessions.
Bank of America’s bond-insurance prices last week surged to a rate of $342,040 a year for coverage on $10 million of debt, above where Lehman Brothers Holdings Inc.’s bond insurance was priced at the start of the week before the firm collapsed. Citigroup’s shares are trading below the split-adjusted price of $28 that they hit on the day the bank’s Fed loans peaked in January 2009. The U.S. unemployment rate was at 9.1 percent in July, compared with 4.7 percent in November 2007, before the recession began.
Homeowners are more than 30 days past due on their mortgage payments on 4.38 million properties in the U.S., and 2.16 million more properties are in foreclosure, representing a combined $1.27 trillion of unpaid principal, estimates Jacksonville, Florida-based Lender Processing Services Inc.


Read Full Story at  http://www.businessweek.com/news/2011-08-22/wall-street-aristocracy-got-1-2-trillion-in-secret-loans.html
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Michael Kinsley: Why Would Anyone Go into Politics?

Crisis August 11, 2011, 10:00 PM EDT

Michael Kinsley: Why Would Anyone Go into Politics?

It’s not money or power that gets people to run; it’s the need to be popular. With the huge U.S. debt to be dealt with, even that reason no longer makes sense

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The Great Budget Debate of 2011 has left behind a sour taste and several big questions, including: Who would want to run a country whose hottest exports are IOUs? Why would anybody choose to be a politician when national office means contending with $14 trillion in debt?
Increasingly, people are opting out. Even senior senators with safe seats and important chairmanships are announcing that they want to spend more time with their families, which actually means they want to spend less time with Harry Reid, Mitch McConnell, and the like. Yet there is never a dearth of people queued up to replace them.
It can’t be for the money. Very few politicians are actually stupid, and even those few who are, usually have a certain animal cunning that would earn them more in the private sector. Our campaign finance system may be a sewer of corruption, but keep in mind that all the money raised legally by politicians must be spent on getting someone elected or re-elected.
Is it ideals that propel people into politics, some vision of America they wish to realize? This is what they all would claim, but it’s not true. They may have inclinations or instincts that come close to core beliefs—smaller government or universal health care—but an actual philosophy of any detail can be a disadvantage in politics, as it will inevitably lead someplace you’d rather not go. Ron Paul, the libertarian who’s running for President as a Republican, will get into trouble again and again if he insists on stating his true beliefs, which he almost always does. Most pols fall somewhere on the spectrum between Paul and Mitt Romney, whose views on every subject are completely at the service of his ambition.
Could it be raw hunger for power that entices people into a political career? That’s the classical explanation. I once asked a conservative colleague what motivated the Soviet Union to continue trying to conquer the world if nobody in the Kremlin bought into Communist ideology anymore. He said, “The same thing that motivates Eileen [an especially devious and power-hungry colleague, name and department changed] to want to be head of HR.”
The trouble is—as the budget brouhaha dramatically demonstrated—no pol, not even the President, has much power or control over events. Certainly running for a seat in the Missouri legislature in the hope of one day being elected President and getting to start wars and do other cool stuff is a fool’s errand.
None of these explanations makes much sense. I’ve concluded the reason so many people still have political ambitions is the desire for popularity. Politics is the only profession where thousands or millions of people actually go out and vote for you. This is close to the ultimate in signaling approval. There was nothing like it until Facebook came along.
Now, I suppose, being “friended” performs roughly the same function of enhancing self-esteem, while being “unfriended” destroys it for others. If you think your ego can survive probable failure, politics may be your ticket. It’s not a totally irrational ambition. At least it wasn’t totally irrational before 82 percent of people polled disapproved of Congress, and didn’t feel much better about other government institutions. Now, you do have to wonder.
Can the politicians do anything to restore their popularity? The traditional method of doing this is to determine what the people want, and give it to them. Crude, but effective. The problem in this case is that the people cannot have what they want. What they want is mathematically impossible: stable or lower taxes and no serious reductions in government benefit programs like Medicare.

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William Safire, the late New York Times columnist and, before that, speechwriter for President Richard Nixon, used to joke that his job in the White House had been that of Rejected Counsel. Nixon was fond of saying, about tough decisions, that some of his advisers had urged him to do the easy thing, the popular thing, but he had rejected this advice and decided to do the right thing, however unpopular. Safire jokingly claimed to be one of the anonymous aides who supposedly told Nixon to do what’s popular and not what’s right.
In a representative democracy like ours, every politician will face the dilemma from time to time: should he or she do what’s right or what’s popular? We celebrate those who choose the former, and re-elect those who do the latter. But another name for doing what’s popular is democracy, and another name for doing what you think is right—though knowing that your constituents disagree—is elitism. Or sometimes, “Going Washington.”
Writer Tom Bethell used to call this the “strange new respect” phenomenon. Some populist firebrand is elected to the House or Senate on a platform of promising to burn down the Capitol and crucify everyone inside. Then he or she votes in favor of, say, raising the retirement age for Social Security by one month every five years, beginning in 100 years or only after every current voter has died, whichever comes later. AARP is having a fit, constituent mail is running 10-to-1 against, but the Washington Post runs a profile saying that our man or woman is being accorded a strange new respect by Washington power brokers. An invitation to a state dinner, a reference in one of the skits at the Gridiron, an appearance on Meet the Press, and our guy or gal is lost to the world outside the Beltway. This is the Tea Party vision of how things work in Washington, and it’s not completely paranoid or imaginary.
What’s popular versus what’s right is a familiar debate, and it seems you can’t have it without bringing up the famous quote from Edmund Burke on the duties of an elected representative: “Your Representative owes you, not his industry only, but his judgement; he betrays, instead of serving you, if he sacrifices it to your opinion.” The flaw in the Burkean argument (which may not have applied in his time but certainly applies in ours) is that this is not the platform elected politicians ran on. They generally didn’t win office by promising to use their best judgment. Nobody wants their judgment. They won by promising to support or oppose specific policies.
Which brings us back to the original question of why anyone would want to be a politician in current circumstances. The clear answer is: I have no idea.
Michael Kinsley is a member of the Bloomberg View editorial board. He was previously the editorial page editor of the Los Angeles Times, the editor of the New Republic and Harper's, and the founding editor of Slate.

Full Story at http://www.businessweek.com/magazine/michael-kinsley-why-would-anyone-go-into-politics-08112011.html
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Build a Website That Drives More Business

Smart Answers August 23, 2011, 11:40 AM EDT

Build a Website That Drives More Business

First, determine what your business does best, then develop a strategy for a site that will show clients why they should hire you, rather than your competition

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I own a travel and tour-operating company that sells tourism packages and air and railway tickets. I have capital and want to use it in a unique way. I would like to stand out with an unusual travel website. Do you have some starting tips? —P.K., New Delhi
The best way for your business to stand out is not through a quirky website, but through a value proposition that differentiates you from your competitors and appeals strongly to a well-defined target market.
Since you’re already in business, think about what unique offerings make your company successful. Are you the best-priced option for family tour packages? Do you have personalized service that makes life easier for your corporate clients? Are you a terrific resource for cultural information on visiting India or another destination?
Define your niche and then design your website to maximize your appeal to that niche, making sure that your marketing campaign emphasizes your company’s strengths, says Gabriel Shaoolian, founder and chief executive officer of Blue Fountain Media, a New York website-design and online-marketing agency. "This is not about smoke and mirrors. There are no gimmicks to doing business online. Your website isn’t going to drive your business model. It is your business model that will drive your website," he says.
One trend that you might consider is incorporating mobile Internet applications, such as iPad and iPhone, into your site, says Brian Morgan, CEO of Adventure Life, a boutique travel agency in Missoula, Mont. Especially when they are on the road, your customers are likely to access your site using mobile devices.

Target Specifically and Energetically

By the way, take a look at the Adventure Life website to see how it immediately conveys Morgan’s niche: Latin American destinations for active, adventuresome travelers. His business clearly appeals to a narrow slice of consumers and his website reflects that target audience accordingly. Your clientele may be totally different than his, but that’s the kind of messaging clarity you want to aim for in your own site.
Morgan recommends also that you incorporate social networking into your site from the start. "Use any way that you can to encourage users to share what they find on your website: Cool travel tips, travel journals" and so forth, he says.
Kristin Lamoureux, director of the International Institute of Tourism at George Washington University, agrees. "All the research shows that social media is where the travel and tourism industry is investing its marketing efforts. Your traditional website has to be well done, clean, and neat, but it also has to be fully integrated into social media," she says. "Give people a place to tell their travel stories, share their best photos, and talk about things like their favorite vacation meal. It can even be a quirky thing like a poll on what tourist site has the cleanest restrooms."
Hospitality and travel businesses have introduced a lot of clever ad campaigns in recent years, including contests and charitable tie-ins. Some offer a hands-on volunteer experience as an option for corporate conference attendees or vacation travelers, for instance, Lamoureux says. Others hold competitions that give away trips that are then documented on video and posted online. Once your own site is up and running, take a look at some of these to get ideas.
Since you have some capital budgeted for the website design project, look for an agency that has experience at not only building attractive, functional websites but that also understands how people shop and buy online, Shaoolian says. "They should understand the principles of effective online messaging and the science of online user behavior." You will save money on your website if you can present clear goals and a success strategy up front, rather than paying the design firm to help you define those things. Good luck.
Karen E. Klein is a Los Angeles-based writer who covers entrepreneurship and small-business issues.
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