Sometimes -- scratch that, many times -- life and business are filled with unfulfilled promise. Out on the news wires today, for example, we saw plenty of examples of wilted hope.
First up, the inventor of "Smell-o-Vision" passed away. In 1960, Michael Todd Jr., a stepson to actress Elizabeth Taylor, produced the first and only reality-enhanced film that preyed on moviegoers' olfactory senses. Scent of Mystery was never a big hit, but its "Smell-o-Vision" technology pumped in smells -- like pipe smoke or food -- from tiny tubes beneath the seats during various scenes in the movie. One can only imagine investors clamoring for a piece of the action. Kind of like getting in on Cisco (Nasdaq: CSCO) back when the going was good, we're sure.
Speaking of failed technology, Napster CEO Konrad Hilbers has resigned, upset that the company's board didn't accept Bertelsmann's -- Napster's chief funder, which has given the company $85 million in loans -- offer of a buyout. Will the promise Napster showed during its brief time as a free music-swapping service EVER materialize in subscription form? Or will it go the way of "Smell-o-Vision" and reek all the way to a slow, expensive death?
Finally, speaking of stench and unfulfilled promise, the Major League Baseball players' union said it's eyeing August as a possible strike date if a new labor agreement can't be reached with the owners. This while the Red Sox have the best record in baseball. If they're in first place and a strike occurs, there will be hell to pay (so says The Motley Fool's managing editor, anyway).
The Motley Fool 50 considered striking once until Bill Mann (TMF Otter) put a beat-down on it. The index whimpered today, finishing off flat.
In today's Motley Fool Take:
Xbox Marks the Spot
The gaming game is starting to get interesting. With Microsoft (Nasdaq: MSFT) following Sony's (NYSE: SNE) lead by slashing the price of its Xbox video game console to $199 today, the pricing war battle lines have been drawn in the sand. The video game industry has always had enough room for two console players to succeed -- never three. With Sony's PlayStation 2 assured of the immunity idol in this game of corporate Survivor, due to its huge market share lead and its savvy business move to make the PS2 backward-compatible to play original PlayStation software, the question becomes who will be the odd one out: Microsoft or Nintendo?
Nintendo has been a powerhouse since the 8-bit 1980s, but it is vulnerable right now. Lacking the DVD capabilities of its competitors and with a dearth of attractive titles, Nintendo's GameCube's saving grace was its $199 price -- and it still wasn't a hot seller. So, even if Nintendo slashes its prices now, being the price leader doesn't guarantee victory.
Microsoft has an even bigger enemy: its own past. The company was already losing money on its consoles and now it will be even deeper in the hole. Shareholders who cherished the company's historically fat margins have to deal with the reality that the more systems the company sells the thinner the overall margins in this segment become in the near term. And, no, the company can't outsource the hardware. It's a razor and blade business, where only the system creators who stand to rake in the easy software licensing fees have the incentive to sell the systems at a loss for the sake of market share.
With pride and the intense need to diversify at stake, Microsoft is not likely to quit the game any time soon. That leaves Nintendo in a vulnerable spot right now. The mighty Nintendo? Why not? Few figured that Sega would ever ditch its hardware side to focus on software for other platforms. Nintendo can always retreat to its GameBoy handheld stronghold and take its line of proprietary characters like Super Mario, Pokemon, and Donkey Kong to be a major software maker for Sony and Microsoft. Then again, we shouldn't jump to conclusions. The game has only just begun.
Should Microsoft be in the video game business? Got any cheat codes for Halo? All this and more -- in the Microsoft Discussion Board. Only on Fool.com.
All hail the whistleblower! Who doesn't admire the person who sees wrongdoing and blows a whistle, alerting the public (or authorities) so that something can be done about it? These people who have taken great personal and professional risk for the greater good deserve our respect.
Some examples of great whistleblowers include Dr. Jeffrey Wigand, who exposed the tobacco industry, and Karen Silkwood, who died under suspicious circumstances while attacking the nuclear industry. Perhaps the most famous (and mysterious) whistleblower is Deep Throat.
Some non-whistleblowers are being classified as whistleblowers, though, and that's worrisome. It's a hard-earned title that shouldn't be awarded lightly. Consider the case of the so-called Enron whistleblower Sherron Watkins. As reported by The New York Times (free registration required), she's being feted all across the nation, on Court TV, at the White House Correspondents' Association dinner, in Congress. Her story has won a $500,000 advance for a book, and she's been pursued by Diane Sawyer, Connie Chung, and Barbara Walters.
What did she do to deserve all this? Well, she did speak up about concerns over Enron's accounting practices. Good for her. But to whom did she speak up? Well, to the foxes guarding the henhouse. This was not whistle blowing. This was whistle holding. Or perhaps just throat clearing. Ms. Watkins does deserve some credit -- she seems to have done much more than most other Enron employees in a position to know and speak up. But let's save our biggest accolades for those who take great chances in their determination to right a wrong, for those who blow loud whistles and refuse not to be heard.
Learn more about whistleblowing at The National Whistleblower Center, The Foundation for Taxpayer and Consumer Rights, The Government Accountability Project, the U.S. Department of Labor, and OSHA.
"I nag him every now and then about whether or not I'll get to wear the Darth Vader outfit, and he gives me a little wink-wink, nudge-nudge, that maybe I will." -- Star Wars: Episode II star Hayden Christensen on George Lucas' cagey response to questions about the fate of his character, Anakin Skywalker, in Episode III, to the Associated Press
Is there a graduate in your life? Your daughter? Your nephew? Your bare-foot grandson who took seven years to get his degree in existential engineering? If so, we have some suggestions for what to give your favorite grad -- gifts that could provide a firm financial foundation on which to build the rest of his life.
- A book about personal finances: As shown in a recent survey of high school seniors, the young folk of today haven't been taught the basics of money management. Fill that dangerous gap in your grad's education with an informative book. (We suggest The Motley Fool Money Guide and The Motley Fool's You Have More Than You Think, but there are many other good choices available.)
- Shares of stock: Talk about the gift that keeps on giving! You'll be bestowing an appreciating asset (over the span of several years, of course), as well as teaching your grad about investing, firsthand.
- A pair of scissors: If stock is the gift that keeps on giving, then debt is the leech that keeps on sucking. Wrap up a pair of scissors and include the instructions that they are to be used (figuratively!) on credit cards that 1) charge more than 10% or 2) have balances of more than $2,000. Also, explain to your grad that she needs only one credit card, so if she has several, the scissors can be used (literally!) on the extras, after the account has been closed. (This will also help her credit rating.)
- This chart: As the illustration shows, someone who begins investing at age 25 will have more than twice as much as someone who starts at age 45 by the time they retire, even though they both invested the same amount of money. Start investing now!
- Big bandages and flesh-colored putty: To cover tattoos and nose-ring holes before job interviews.
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Fools Attend RetireMint Conference for Free!
To help educate Americans about the importance of saving, investing, and planning financially for all life stages, the American Savings Education Council (ASEC) will hold the second RetireMint conference in New York City on May 17-18, 2002. The two-day financial education event -- the largest and most comprehensive of its kind -- is geared to both individual investors of all ages and backgrounds and benefits professionals. The RetireMint conference will consist of two program tracks, "Money Survival Skills for Real People" and "Retirement Plans: Here Today... Where Tomorrow?"
And the best news: Fools can attend for FREE (save $20!) by registering here: www.retiremint.com/thefool/. Come and join Fool personal finance writers Dayana Yochim (TMF School) and Robert Brokamp (TMF Bro) to discuss ways to rule your retirement, boost your short-term savings, and anything else that is on your mind!
The Washington Post reports that AOL Time Warner (NYSE: AOL) is set to undergo a reorganization that will involve the departure of some executives. The changes also may involve layoffs for the company's interactive marketing division.
A disturbing report in The New York Times points out the incredible influence drug companies have on some physicians. The article says some doctors have accepted money from pharmaceutical sales representatives and have allowed them "into their examining rooms to meet with patients, review medical charts, and recommend what medicines to prescribe." What's more, "Some of those salespeople tried to influence doctors to prescribe drugs for uses that were not approved by the federal Food and Drug Administration." Singled out is Warner-Lambert, a division of Pfizer (NYSE: PFE), which allegedly had representatives pushing a drug only approved for epilepsy for dozens of other uses.
Federated Department Stores (NYSE: FD), the parent company of Macy's and Bloomingdale's, issued an amusing earnings release today. The headline blared: "Federated 1Q Earnings Exceed Expectations," but closer inspection reveals its profit of $0.43 a share was really "within the range of its most recent guidance of 40-43 cents a share." The company said its earnings expectations for the remainder of 2002 remain unchanged.
Campbell Soup's (NYSE: CPB) third-quarter earnings were M'm M'm blah, down 21% from the same period last year. That was pretty much in line with expectations, and full-year guidance stays at $1.30 a share.
After the bell yesterday, Hewlett-Packard (NYSE: HPQ) reported second-quarter earnings of $0.13 a share, as expected. Revenue was a bit disappointing, though, falling 9%. This was the company's last report before reciting wedding vows with Compaq.
And Finally...
Today on Fool.com: In Rule Maker, Bill Mann scavenges for bargains among the dead.... Guest columnist Whitney Tilson highlights Buffett partner Charlie Munger's investing genius.... In Fool's School, Selena Maranjian warns against crafty companies and misleading numbers.... Despite the bull markets of the '80s and '90s, future retirees have smaller nest eggs.
Contributors:
Bob Bobala, Robert Brokamp, Jeff Fischer, Tom Jacobs, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Reggie Santiago, Dayana Yochim
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