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The Boss: Paul Bensabat of Manischewitz, a King of Kosher

October 30, 2011 by Leave a Comment

Those years gave me a certain toughness about life that I probably would not otherwise have had. When you’re 7 and don’t have Mom and Dad to run to every minute, you learn to manage your own life. I have some difficult memories of this time, but I learned a lot.

My father owned factories that canned sardines. Watching him conduct business every day influenced me. When I was 6, every time we visited my grandmother, who lived near a lollipop factory, the owner would give me a lollipop. One day I asked if I could buy some, and he said no, that he only sold wholesale. Finally, he sold me a bag of 100, at a penny each. I resold them to children at my school and in our apartment building for 5 cents. I had grasped the concept of profit.

At 18, I enrolled in business school in France and majored in marketing. After graduating in 1978, I moved to New York to study for an M.B.A. in finance and international trade at New York University. I walked out of my first finance class, called my parents and asked them to send me a plane ticket home because I had only understood one out of four words. My parents calmed me down and within three months I became comfortable enough with English to succeed in school.

As I left France for the United States, my best friend from Casablanca suggested that I look up his cousin, Alain Bankier, who was living in New York and was enrolled in the same M.B.A. program I was. Alain has been my friend, co-investor and co-C.E.O. in numerous ventures ever since.

After finishing my M.B.A. in 1980, I got an internship that turned into a job with a group of eight French cheese producers who had an American subsidiary in New York. The company was not doing well and everyone was expecting it to fall apart. I changed its strategy of distribution, and it became a success.

In 1984, I joined the Lactalis American Group, a unit of the big European dairy group, as president and C.E.O. We grew quickly during the 18 years I was there. In 2002, I left because I was itching to start a business with Alain. I had that entrepreneurial spirit in my gut for a long time, and I should have acted on it earlier.

We created the Saveur Food Group in 2003 and started buying companies, including Tyson Foods’ hors d’oeuvres division and DFG Foods, which we rebuilt as Cuisine Innovations. That company is now the parent of brands that include  Kaptain’s Ketch and Ratner’s, which make premium prepared foods.

Three and a half years ago, we merged with Manischewitz, which is a 123-year-old company. We sell specialty kosher foods, but we have other lines, too, such as Guiltless Gourmet and Season, the big importer of sardines from Morocco. (We have granted the license for Manischewitz wines to Constellation Wines U.S.)

We made some big changes when we took over to turn the company around, like reducing the staff by half. It’s probably the toughest thing you do as C.E.O.

I co-founded and serve as co-president of The French Will Never Forget, a grass-roots initiative that promotes a Franco-American friendship. In September, we erected 75-foot-high models of the Twin Towers near the Eiffel Tower in Paris, in memory of the victims of 9/11.

As told to Patricia R. Olsen.

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Posting: Posting

October 30, 2011 by Leave a Comment

Now, advances in virtual staging enable brokers to do even more. They can remove clutter from a photograph of an apartment, spiff up a scratched stainless steel refrigerator, even open up the kitchen to the living room by removing a wall.

“I’ve gone to dozens and dozens of open houses, and I’m always being told to use my imagination by a broker,” said Vince Collura, the president of the Gotham Photo Company, which offers the services. “Customers don’t have imagination; they’re looking for the potential risks, not the possibilities.”

Gotham offers what it calls “Gotham Renew” to brokers who want to clean out cluttered spaces, and “Gotham Revamp” to brokers who want to show what renovations could do for an apartment. Gotham also continues to offer virtual staging, which it calls “Gotham Envision,” to add furniture to an image, as do a handful of other companies, like Virtual Staging Solutions and Virtually Staging Properties.

A virtually staged digital image created with Envision costs $65, while an image created with Renew runs a bit more, depending on how much clutter is cleared, Mr. Collura said. Images created with Revamp start at $100 and go up depending on the complexity of renovations, he said.

The question of who pays for staging is usually resolved in the broker’s agreement with the seller.

Mr. Collura said the ability to manipulate photographic images could be abused by some brokers to mislead customers, so Gotham has worked out procedures for the use of the images with the legal departments of the largest brokerages.

He said these could include a note on the image saying it had been virtually staged, or side-by-side images labeled “before” and “after.”

Tracey Lundberg, a sales associate with Prudential Douglas Elliman, spent $292 for two images to market a studio apartment at 225 West 70th Street, listed for $399,000. The apartment was almost empty, except for some essential furniture for the owner, who was still residing there.

Not only did Ms. Lundberg have Gotham virtually stage the studio apartment, but she also used the Revamp service to open up the wall of a dressing room to create a small bedroom, adding French doors in the process. (She also spent $80 to have Gotham make a three-dimensional floor plan showing the renovations.)

Eventually the seller received an offer above the asking price, though the deal fell through and the unit remains on the market, Ms. Lundberg said.

“Most buyers actually commented that the illustration helped them to see the possibilities,” she said, “and they had a lot of enthusiasm about the potential of creating an extra room.”

Chad Thomas, a vice president and associate broker with the brokerage Mark David Company, used both the Renew and Revamp services to market a 4,300-square-foot loft space at 424 Broadway. The loft had been used as a commercial space, but can be used as a residence, he said.

“They took the raw space and made it look as-is, but clean,” Mr. Thomas said. “They made a patchy tin ceiling all one solid color, made the floor and walls clean and consistent, and brightened up the entire space.

“Then they basically installed a kitchen, placed furniture, created a new elevator door, and put up walls where bedrooms would go,” he said.

Other brokers have found a use for Gotham’s services in the new development market, where virtual images were used more widely during the most recent booming market, in which buyers signed contracts after seeing only floor plans.

Jessica Peters, an agent with Prudential Douglas Elliman, says she uses virtual staging for apartments in the same line to show their potential, minimizing the need for expensive model apartments, or in smaller developments, eliminating model apartments altogether.

Ms. Peters says she also frequently markets individual resale apartments being sold by investors, which are often vacant, so she uses virtual staging in those cases. “It’s about $150 to virtually stage a two-bedroom apartment,” she said, “and if you’re actually staging a model unit, it can cost a minimum of $10,000. And this isn’t even high-end furniture. I’m talking Ikea and West Elm.”

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Digital Domain: On Hulu and YouTube, Commercials by Multiple Choice

October 30, 2011 by Leave a Comment

On a computer monitor, just inches away, they are often something else: downright invasive.

Both Hulu.com and YouTube know that many of their viewers hate commercials, and yet their business models have depended mostly on advertising. So both have been trying to make online commercials more appealing. And both are headed in the same direction: offering online viewers the chance to choose which commercials they watch.

This month, Hulu introduced a format that gives users the option of clicking an “ad swap” button after a commercial begins and choosing to replace it with one of two or three options. Don’t want to sit through an oil company’s commercial? Then go with one from a cellphone carrier or a razor maker.

The system isn’t perfect. By the time users decide to go with an alternative, they may have already seen a good portion of the first ad. Beginning a second one means a longer commercial break.

So why not delay starting an ad to let the user choose first? Hulu has tried precisely that with an older format it still uses. It found, however, that many users were annoyed by the process of having to choose or wait for a default choice. People were also not happy with choices that consisted only of three variations on one product, like shampoos tailored for fine, thick or curly hair.

When presented with the newest ad format, Hulu users can elect not to click the button to swap commercials and instead continue to watch whatever is shown by default. “We didn’t want to make using Hulu a lot of work,” says Jean-Paul Colaco, its senior vice president for advertising. “Like Amazon.com’s 1-Click button, you don’t have to use it,” he says. (With 1-Click, users order an item immediately, without visiting a checkout page.)

Those who log in as Hulu users are more likely to see commercials that interest them. Hulu notes users’ ad selections as well as feedback about a commercial if they answer a question that may be above the frame: “Is this ad relevant to you?”

In generating revenue from advertisers, Hulu must make the most of its commercials because it typically shows only half as many minutes of ads for a given program as there would be on television. For a “half-hour” show, which actually runs 22 minutes, it shows four minutes of commercials instead of eight. But those four minutes may seem about as long as the eight because they include a commercial that plays even before the show begins, then three commercial breaks during the show — and there is no way to fast-forward as one could with a DVR.

HULU offers other formats to advertisers, too. In one of them, viewers have this choice at the beginning: endure one 2 1/2 -minute ad at the beginning and be done with commercials, or watch as usual. Another format offers the option of playing a trivia quiz or a puzzle, sponsored by an advertiser, in order to earn a commercial-free viewing.

Such trade-offs have not been enormously popular. Mr. Colaco says Hulu is concentrating on trying to match each user with the right ads and letting users fix the occasional mismatch for themselves by choosing an alternative.

YouTube is also offering formats that give users an option, including one in beta testing that provides a choice of three commercials. It is being tried only on YouTube’s long-form videos, which run at least 10 minutes. The format has not yet attracted enough advertisers to be used with a significant number of videos; I tried but had no luck seeing it in the wild.

For shorter videos, YouTube offers a “skippable” ad format. This allows a user to end the ad after five seconds — and no replacement follows. The program simply resumes. The advertiser is charged only when users have chosen to watch the ad.

Baljeet Singh, a senior product manager at YouTube, said that when it first tried skippable ads, the skip rate was low — surprisingly low. So the skip button was made more prominent and the rate rose. This assured advertisers that viewers who stuck around did so by choice.

Google acquired YouTube in 2006 and does not break out its financial performance. Hulu, which says it is profitable, is a joint venture whose owners include NBC Universal, the News Corporation and the Walt Disney Company.

It is possible that Hulu may decide that free, ad-supported television simply isn’t viable. Last year, it introduced a subscription service, Hulu Plus, that is growing rapidly. For $7.99 a month, the subscribers have access to more episodes of shows, can watch the shows on portable devices and are exposed to fewer commercials, though still some. The company says the service exceeded one million paid subscribers this summer and expects its subscription services to account for more than half its overall revenue within the next 12 months.

THEN there is another strategy: creating commercials that people actually look forward to watching. Consider last year’s Old Spice commercials, featuring Isaiah Mustafa as the Old Spice Man. In just two months, the videos of these ads set a YouTube record for shortest time for any program to reach 100 million views. (Sorry, Susan Boyle.)

Every one of those 100 million views was by choice. Now, we await an idyllic future when every other commercial seen online is viewed voluntarily, too.

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Novelties: High-Definition 3-D, Coming in a Sony Headset

October 30, 2011 by Leave a Comment

But for those who want an even more personal experience, Sony will soon introduce a high-definition, three-dimensional display built into the visor of a headset.

Called a Personal 3D Viewer, this pearly gray visor has two small screens that sit an inch or two in front of the eyes. Pull on the visor as you would a baseball cap, plug the headset into a cable box, game console or Blu-ray player and then watch as high-definition 3-D video fills the visual equivalent of a movie theater screen. The images on the twin screens are made of micron-size pixels that are unnoticeable even from a nose-length away.

The headsets will go on sale in the United States next month for $799, said Charles Speidel, vice president of the Sony Electronics home audio and video group in San Diego. As with other stereoscopic displays, each eye sees a different image — the brain combines them for an illusion of depth.

The headset weighs a bit less than a pound. It leaves enough room inside for eyeglasses (which I wear) and can be adjusted so that not all the weight is resting on the bridge of the nose. Still, I found wearing it a bit cumbersome — until I started watching a demonstration video. Then I was too busy to notice, as I reflexively dodged cars and projectiles hurtling toward me from the screen.

Image quality is excellent on the screens, which measure 0.7 inch diagonally, said Chris Chinnock, president of the marketing firm Insight Media, who has tried the new device at trade shows. “But you are still wearing this bulky headset,” he added.

The screens are made of organic light-emitting diodes that glow when a current passes through them, creating bright colors and deep blacks.

The Sony headset was designed with the home theater fan in mind — it does not plug into an iPad, or iPhone, although it will work with one Android tablet, said Rob Manfredo, a Sony spokesman.

If you want a more portable 3-D headset, plug the Vuzix Wrap 1200 ($499) into your iPhone, iPad, Android or portable gaming device — or even into your PC — and watch both 2-D and 3-D video, though not in high definition. (This headset is designed to look like sunglasses.)

As yet, there isn’t a vast array of 3-D entertainment to watch on headsets — a situation likely to deter many consumers, said Carolina Milanesi, an analyst based in London for the research firm Gartner. “People aren’t going to rush to buy hardware if there isn’t anything much to watch,” she said.

The number of quality 3-D movies and games is still relatively small. Owners will be able to plug the Sony headset into a cable box and watch college football in 3-D on ESPN 3D, or into a game system or 3-D Blu-ray player, Mr. Manfredo said. There are about 85 Blu-ray movies in 3-D, he said, including “The Lion King,” “Pirates of the Caribbean: On Stranger Tides” and “Avatar.”

The headset is wired to a hand-size control box that plugs into a set-top box or any other source of 3-D content via an HDMI cable, which carries data fast enough for 3-D signals. Viewers can also watch in 2-D on the headset.

Mr. Speidel of Sony says the headset isn’t meant for viewers who are 15 or younger, in part because its dimensions are better suited to adult-size heads.

In addition, it might not be good for youngsters’ eyes, he said. “At that age, children’s eyes are still developing,” he said. “It’s a new technology and kids spend a lot of time gaming.” When viewers turn on the set, Mr. Manfredo said, they will see a recommendation to spare young eyes.

Dr. David G. Hunter, ophthalmologist in chief at Children’s Hospital Boston and a professor at Harvard Medical School, said that most visual development happens before age 7 or 8.

“That’s when something could potentially go wrong if you were wearing these for all of your waking hours,” Dr. Hunter said.

He had this practical advice for people of any age who are concerned about eyestrain: “Common sense dictates that if the headset bothers your eyes, you should take it off.”

A DIFFERENT hazard concerned Sherry Turkle, a professor at the Massachusetts Institute of Technology and author of “Alone Together: Why We Expect More From Technology and Less From Each Other.”

Gadgets like 3-D headsets are seductive, she said, but the danger is that they seal people off from their environment and from others.

“People used to walk with eyes to the sand and water,” she said, using the example of people strolling at the seashore. “Now everyone walks with a device. No one is looking at the sand.”

She has reservations about the technology that has produced immersive personal devices like music players, smartphones and video headsets.

“The technology which looked so good 15 to 20 years ago,” she said, “now looks like it helps us miss out on the complexities and grittiness and ups and downs of what real life has to offer.”

E-mail: novelties@nytimes.com.

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In Village’s Fight Over Gas Drilling, Civility Is Fading

October 30, 2011 by Leave a Comment

Computer-generated, unsigned and sent to about 10 other opponents of a practice known as fracking, it compared them to Nazis and said they were being watched while picking up their children at school in their minivans.

Jennifer Huntington’s abuse is more public, like comments online suggesting that people find out where her dairy sells its milk so that they can stop buying it, or the warning that her farm, which has a lease with a gas company, “will fall like a house of cards when your water is poisoned.” She and other drilling proponents have also been called “sellout landowners that prostitute themselves for money.”

The debate over horizontal hydraulic fracturing, or fracking, the injection of huge quantities of chemically treated water underground to free up natural gas, has become increasingly contentious across the Eastern United States, with dozens of communities passing or considering bans. But that ill will often takes its most intimate form in small towns and rural areas like this one, best known as the home of baseball’s Hall of Fame, where fracking has emerged as the defining, non-negotiable political issue.

The dispute has pitted neighbor against neighbor, and has often set people who live in suburbs or villages against the farmers and landowners who live outside them. The discord is compounded by hard times on both sides and by communication online giving everyone instant access to limitless information confirming their point of view.

And if gas companies have the power and money, fracking opponents, who are concerned about ecological threats like the possible contamination of drinking water, often have the numbers and the intensity to dominate local discourse. “There’s no arguing with a person who is opposed to hydrofracking,” said Bill Michaels, a councilman in the Town of Otsego, which includes parts of Cooperstown. After waiting to take a position, he eventually supported changes to the town’s land-use law that would prohibit fracking, but he still faces opposition from a slate of antifracking candidates. “There is no debate or conversation,” he added. “This is so important to so many people it’s pretty much hijacked everything else.”

The state plans to hold hearings in November before issuing final regulations on gas drilling, and the first gas wells drilled under the new rules could be possible next year.

As it turns out, despite the furor here, the Marcellus Shale, a vast rock formation under New York, Pennsylvania and other states, is so shallow near Cooperstown it is not clear how much gas would be available and what kind of drilling would take place here. And no one expects that fracking will ever come to Cooperstown itself.

Still, at the top of the Village of Cooperstown’s Web site is a statement recommending a statewide ban on gas drilling and fracking. Middlefield, the other town that includes parts of the Village of Cooperstown, was one of the first municipalities to ban gas drilling through changes to its master plan and zoning.

More than 30 antifracking candidates are running for office in Otsego County in November.

The dispute is also running like an electric current through everyday life. Ms. Jastremski, who five years ago moved back to family-owned land when her husband became an English professor at the State University of New York at Oneonta, thought she had found the perfect place to raise her two children, replete with chicken coops, bee hives and a vegetable garden.

But as she became aware of leases that would allow drilling for gas on various properties in the area, she became increasingly wrapped up in fracking politics. Now, she says, she stays up at night crying over what she sees as the possibility of polluted water, an industrialized landscape and having to leave her home as its value plummets. She said she understood the economic pressures facing some farmers, but could not excuse people who want drilling on their land.

“I think even if individuals here are not incredibly greedy, they are being sucked into a corporate greed that’s at work in our country,” she said. “They’re seeing dollar signs everywhere, and they’re not seeing the bigger picture that they’re harming their neighbors.”

Ms. Jastremski, 43, who has a Ph.D. in Slavic Studies and works as a technical writer, says she is uncomfortable with the discord surrounding the issue, like a clash she had at the gym with another mother who stood to gain from a gas lease, but feels she has no choice but to be vocal.

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Essay: Luck Is Just the Spark for Business Giants

October 30, 2011 by Leave a Comment

And maybe that’s true — if you just want to be merely good, not much better than average. But what if you want to build or do something great? And what if you want to do so in today’s unstable and unpredictable world?

Recently, we completed a nine-year research study of some of the most extreme business successes of modern times. We examined entrepreneurs who built small enterprises into companies that outperformed their industries by a factor of 10 in highly turbulent environments. We call them 10Xers, for “10 times success.”

The very nature of this study — how some people thrive in uncertainty, lead in chaos, deal with a world full of big, disruptive forces that we cannot predict or control — led us to smack into the question, “Just what is the role of luck?”

Could it be that leaders’ skills account for the difference between just meeting their industry’s average performance (1X success) and doubling it (2X)? But that luck accounts for all the difference between 2X and 10X?

Maybe, or maybe not.

But how on Earth could we go about quantifying something as elusive as “luck”? The breakthrough came in seeing luck as an event, not as some indefinable aura. We defined a “luck event” as one that meets three tests. First, some significant aspect of the event occurs largely or entirely independent of the actions of the enterprise’s main actors. Second, the event has a potentially significant consequence — good or bad. And, third, it has some element of unpredictability.

We systematically found 230 significant luck events across the history of our study’s subjects. We considered good luck, bad luck, the timing of luck and the size of “luck spikes.” Adding up the evidence, we found that the 10X cases weren’t generally “luckier” than the comparison cases. (We compared the 10X companies with a control group of companies that failed to become great in the same extreme environments.)

The 10X cases and the control group both had luck, good and bad, in comparable amounts, so the evidence leads us to conclude that luck doesn’t cause 10X success. The crucial question is not, “Are you lucky?” but “Do you get a high return on luck?”

Return on luck: We call it ROL.

SO why did Bill Gates become a 10Xer, building a great software company in the personal computer revolution? Through one lens, you might see Mr. Gates as incredibly lucky. He just happened to have been born into an upper-middle-class American family that had the resources to send him to a private school. His family happened to enroll him at Lakeside School in Seattle, which had a Teletype connection to a computer upon which he could learn to program — something that was unusual for schools in the late 1960s and early ’70s.

He also just happened to have been born at the right time, coming of age as the advancement of microelectronics made the PC inevitable. Had he been born 10 years later, or even just five years later, he would have missed the moment.

Mr. Gates’s friend Paul Allen just happened to see a cover article in the January 1975 issue of Popular Electronics, titled “World’s First Microcomputer Kit to Rival Commercial Models.” It was about the Altair, designed by a small company in Albuquerque. Mr. Gates and Mr. Allen had the idea to convert the programming language Basic into a product that could be used on the Altair, which would put them in position to be the first to sell such a product for a personal computer. Mr. Gates went to college at Harvard, which just happened to have a PDP-10 computer upon which he could develop and test his ideas.

Wow, Bill Gates was really lucky, right?

Yes, he was. But luck is not why Bill Gates became a 10Xer. Consider these questions:

• Was Bill Gates the only person of his era who grew up in an upper middle-class American family?

• Was he the only person born in the mid-1950s who attended a secondary school with access to computing?

Jim Collins is the author of the worldwide best seller “Good to Great.” This article was adapted from “Great by Choice: Uncertainty, Chaos, and Luck — Why Some Thrive Despite Them All,” which was written with Morten T. Hansen and published this month.

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Business Briefing | Company News: Weyerhaeuser Earnings Meet Expectations

October 30, 2011 by Leave a Comment

Weyerhaeuser, the forest products maker and homebuilder, reported quarterly profit that matched Wall Street’s expectations, but the company warned that the United States housing market remained challenging and that China demand was slowing. For the third quarter, the company posted net income of $157 million, or 29 cents a share, compared with $1.12 billion, or $3.50 a share, a year ago. Sales rose 3.6 percent to $1.56 billion. Shares of Weyerhaeuser rose 2 percent, to $18.30.

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Business Briefing | Company News: Goodyear Finds Profit From Highest Revenue Ever

October 30, 2011 by Leave a Comment

Goodyear Tire and Rubber posted a profit for the third quarter on a 22 percent rise in revenue as its strategy of promoting high-end tires paid off even as the number of tires it sold was unchanged. The company, the biggest American tire maker, said its revenue was the highest for any quarter in its history. Goodyear reported net income of $161 million, or 60 cents a share, in the three months ended Sept. 30. It lost $20 million, or 8 cents a share, in the same quarter a year ago. Revenue rose to $6.1 billion from $5 billion a year ago. Its shares rose 4 percent, to close at $14.84.

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Stocks & Bonds: Shares Settle After Rally Over European Debt Deal

October 30, 2011 by Leave a Comment

Stocks in the United States eased back on Friday from their biggest monthly rally in decades, ending relatively flat as the euphoria over Europe’s plan to address its sovereign debt crisis eased.

For the week, the three main indexes on Wall Street closed more than 3 percent higher, lifted mostly by the surge on Thursday that followed the announcement of the latest European rescue plan. The broader market in the United States, as measured by the Standard Poor’s 500-stock index, moved back into positive territory for the year.

But on Friday, some of the luster started to wear off as analysts focused on lingering doubts about whether the European plan would restore growth or bring long-term solutions to the sovereign debt problems in the countries that share the euro.

“The enthusiasm is fading,” Guy LeBas, a strategist at Janney Montgomery Scott, said in a market commentary.

The ratings agency Fitch said that progress needed to be demonstrated in several areas: achieving a broad-based economic recovery in the euro zone, reducing government budget deficits, and stabilizing and reducing government debt ratios. Otherwise, it added, financial market volatility and downward pressure on sovereign ratings would continue.

On Wall Street, the Dow Jones industrial average was up 0.18 percent, or 22.56 points, at 12,231.11 and the S. P. was up 0.04 percent, or less than a point, at 1,285.08. The Nasdaq was down 1.48 points at 2,737.15.

The Euro Stoxx 50 index of euro zone blue chips closed down 0.6 percent, while markets in Britain and Paris were also slightly lower. Germany’s DAX was up 0.13 percent. Asian stocks closed higher.

While some trading this week in the United States was inspired by corporate earnings, reports of mergers and economic data, the financial markets were mostly focused on the prospects of some kind of agreement on a way to resolve Europe’s debt problems.

Those hopes helped stocks to rise on Monday, but on Tuesday they sank after the abrupt cancellation of a meeting of European finance ministers that was meant to precede the meeting that resulted in the final plan.

Stocks rose again on Wednesday and powered higher on Thursday around the world after the summit meeting in Brussels.

“There is not enough detail around what is going on in Europe and until you get more clarification, you will probably get some days where you will see swings like this,” said Laura LaRosa, the director of fixed income at the investment and wealth management firm Glenmede in Philadelphia.

Still, the S. P. 500 was up 13.58 percent so far this month, its highest monthly gain since October 1974, when it rose 16.3 percent in the month.

Ross Junge, the chief investment officer for fixed income, at Aviva Investors North America, said the combination of modestly improving economic data recently for the United States and lower euro zone risks contributed to a “modestly positive” outlook for the credit markets.

“The key impacts from the announcement are investors’ increased confidence that the threat of a near-term systemic financial crisis will be avoided and the potential spillover risks to the U.S. economy and financial institutions should be reduced,” Mr. Junge said in a market commentary. “However, there will likely be additional bumps along the way.”

Ms. LaRosa said the price on the benchmark bond would rise as the market remained unsteady.

The United States 10-year Treasury bond rose to 98 9/32 from 97 24/32. The yield was 2.32 percent, down from 2.39 percent on Thursday.

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Qantas Airways Grounds Fleet in Labor Dispute

October 30, 2011 by Leave a Comment

The grounding, preceded by months of tension between the airline and its workers, led to the immediate cancellation of hundreds of flights, the airline said, forcing Prime Minister Julia Gillard’s beleaguered government to try to end the standoff. An emergency meeting of the national workplace relations tribunal worked through the night before adjourning on Sunday morning without a resolution. The panel said it would resume discussions later in the day.

Passengers were being rebooked on other airlines at the airline’s expense, Qantas said. But that was little comfort to stranded travelers, many of whom focused their anger at the airline and its chief executive, Alan Joyce.

“I’m definitely never flying Qantas again,” one passenger, Samantha Palmer, told the Australian Broadcasting Corporation.

A series of labor disputes has hit the airline, the world’s 10th largest, as employees have voiced concern about jobs being moved out of Australia. Qantas has been forced to reduce and reschedule flights for weeks because of the actions, which have included strikes and refusal to work overtime.

Mr. Joyce said the airline’s fleet of 108 aircraft in up to 22 countries would remain grounded until Qantas reached an agreement over pay and work conditions with the unions representing pilots, mechanics and ground staff. Qantas employs about 35,000 people.

A spokesman for the Australian Workers’ Union, one of the country’s oldest and largest unions, with more than 135,000 members, criticized the airline’s decision to ground its fleet without notice. “Words can’t express our anger at the unilateral decision Qantas management has taken — as well as the impact it will have on all Qantas workers and the thousands of travelers now left stranded in Australia and around the world,” the national secretary of the group, Paul Howes, said.

“Unions rightly give 72 hours’ notice before industrial action, but Qantas management has given no notice before this wildcat grounding of their fleet,” he said in a statement on the union Web site.

The airline said that beginning Monday it would lock out all employees involved in the dispute, including pilots and engineers, among others. The grounding of the fleet will cost the airline an estimated $21 million a day. Qantas said it had already been losing $16 million a week in revenue as a result of the job actions.

Barry Jackson of the Australian and International Pilots Association told Sky News that Qantas had “hijacked the nation.” Mr. Jackson added, “It’s forcing the government’s hand on this.”

The Australian Foreign Ministry was adding emergency staff in Canberra, the capital, to help Australians who were stranded.

The leader of Australia’s political opposition, Tony Abbott, suggested that Ms. Gillard’s Labor government was too close to the unions involved and was putting the country’s prestige at risk.

“There’s going to be massive public inconvenience, there’s going to be massive disruption to business and there’s going to be a very big hit on Australia’s international reputation because Qantas really is around the world, to a considerable extent, the face and the symbol of Australia,” he said in televised remarks.

Qantas has several flights a day from Sydney to Kennedy Airport in New York, and to Los Angeles, Dallas-Fort Worth and Honolulu.

Near-empty airports and angry customers became a staple of Australian television on Saturday night, as travelers took to social networking sites like Twitter to vent their frustration.

“Plane door was closed then they announced we were not going,” Christine Walker, a Qantas passenger in Los Angeles, wrote on Twitter in response to a question about her flight.

Matt Siegel reported from Sydney, and Kevin Drew from Hong Kong.

Article source: http://www.nytimes.com/2011/10/30/business/global/qantas-grounds-its-worldwide-fleet-over-labor-dispute.html?partner=rss&emc=rss

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