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Beijing Opposes U.S. Rule on Technology Imports

March 31, 2013 by Leave a Comment

BEIJING — China expressed “resolute opposition” and “strong dissatisfaction” with a new U.S. cyberespionage rule limiting imports of Chinese-made information technology products, the state media reported over the weekend.

The remarks underscore growing tension between the world’s top two economies after the United States accused China of backing a string of hacking attacks on U.S. companies and government agencies. China says that the accusation lacks proof and that it is also a victim of hacking attacks, more than half of which originate in the United States.

The new provision, tucked into a funding bill signed into law in Washington on Thursday, requires NASA, as well as the U.S. Justice and Commerce Departments, to seek approval from national law enforcement officials before buying information technology systems from China. The United States imports about $129 billion worth of “advanced technology products” from China, according to a May 2012 report by the U.S. Congressional Research Service.

The Chinese state media, including Xinhua, China Daily and People’s Daily, quoted a spokesman for the Chinese Ministry of Commerce on Saturday as saying the U.S. bill “sends a very wrong signal.”

“This will directly impact partnerships of Chinese enterprises and American business as they conduct regular trade,” said Shen Danyang, the Commerce Ministry spokesman.

“This abuse of so-called national security measures is unfair to Chinese enterprises, and extends the discriminatory practice of presumption of guilt,” the article in the official People’s Daily said, quoting Mr. Shen. “This severely damages mutual trust between the U.S. and China.” The United States should eliminate the law, Mr. Shen said.

The technology security lawyer Stewart Baker wrote in a blog post last week that China could claim that the United States was violating World Trade Organization rules. However, because Beijing has not signed a W.T.O. agreement setting international rules for government procurement, it may not be successful in its challenge, Mr. Baker said.

The Chinese Foreign Ministry spokesman Hong Lei urged the United States at a news conference to abandon the law. “This bill uses Internet security as an excuse to take discriminatory steps against Chinese companies,” he said.

Article source: http://www.nytimes.com/2013/04/01/business/global/beijing-opposes-us-rule-on-technology-imports.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

E-Commerce Companies Bypass Middlemen to Build Premium Brand

March 31, 2013 by Leave a Comment

But what if they left out most of those people? “I had been to the factories and knew what it costs to manufacture glasses and knew the cost didn’t warrant a $700 price tag,” said Neil Blumenthal, a founder of the company. Inspired by glasses they found in their grandparents’ attics, the founders sketched a few frames, hired the same Chinese factories that make designer glasses and started selling directly to consumers online. By doing so, they eliminated enough of the cost to charge customers just $95 a pair.

Warby Parker is part of a wave of e-commerce companies that are trying to build premium brands at discount prices by cutting out middlemen and going straight to manufacturers. They make everything from bedding (Crane and Canopy), to office supplies (Poppin), nail polish (Julep), tech accessories (Monoprice), men’s shoes (Beckett Simonon) and shaving supplies (Harry’s).

The result is generally cheaper products for consumers and higher profit margins for the companies.

Big retailers discovered long ago that controlling the supply chain benefited their bottom lines, which is why companies like Wal-Mart and Whole Foods sell many products under their own brands. At Macy’s and Kohl’s, such “private label” brands make up almost half of their sales.

Start-ups have traditionally struggled to match those efforts. They do not have as much brand recognition as big retailers, and persuading consumers to take a chance on, say, Warby Parker eyeglasses instead of Prada’s can be difficult.

“The challenge is, if you’ve never heard of the brand, you wonder, ‘Should I buy it when it’s 20 percent cheaper?’ ” said Raj Kumar, a supply chain consultant at A. T. Kearney. “Or should I buy a brand I trust?”

What is empowering the upstarts now is the Web’s ability to reach lots of consumers without the costs of operating physical stores as well as a change in manufacturers’ willingness to work with small brands.

The founders of Deal Décor, whose model was to sell furniture directly to customers, worked at Target and Home Depot Direct before starting their company. They said they saw an opening after the recession hit.

As home sales in the United States declined, and furniture sales went with them, Chinese furniture factories had excess capacity, said Craig Sakuma, co-founder of the company. Where the factories had previously been unwilling to take small production orders, they were now eager for business — but they were concerned about getting paid, as they were already chasing down payments from errant retailers.

So Deal Décor approached manufacturers with an appealing proposal: it would pay them as the products were shipped, rather than a month or more later.

Unlike traditional furniture retailers, Deal Décor’s model was to sell couches or bookshelves on its Web site before they were in production. It timed the deals for when a factory was producing similar items for other clients and could easily add Deal Décor’s order. Deal Décor ordered the exact quantity it had sold and had the items shipped straight from the factory to customers eight to 16 weeks later.

Because they are not dependent on third parties, these e-commerce companies can also introduce products much more quickly.

Crane and Canopy, for example, releases new duvet covers and sheet sets every other week and designs textiles based on current trends on Pinterest and elsewhere, instead of planning collections seasons ahead of time like most brands, said Karin Shieh, its co-founder.

Article source: http://www.nytimes.com/2013/04/01/business/e-commerce-companies-bypass-middlemen-to-build-premium-brand.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Russia Begins Selectively Blocking Internet Content

March 31, 2013 by Leave a Comment

The country’s communications regulators have required Facebook, Twitter and YouTube to remove material that the officials determined was objectionable, with only YouTube, owned by Google, resisting. The video-sharing site complied with a Russian agency’s order to block a video that officials said promoted suicide. But YouTube filed a lawsuit in Russian court in February saying the video, showing how to make a fake wound with makeup materials and a razor blade, was intended for entertainment and should not be restricted.

Supporters of the law, which took effect in November, say it is a narrowly focused way of controlling child pornography and content that promotes drug use and suicide.

But opposition leaders have railed against the law as a crack in the doorway to broader Internet censorship. They say they worry that social networks, which have been used to arrange protests against President Vladimir V. Putin, will be stifled.

The child protection law, they say, builds a system for government officials to demand that companies selectively block individual postings, so that contentious material can be removed without resorting to a countrywide ban on, for example, Facebook or YouTube, which would reflect poorly on Russia’s image abroad and anger Internet users at home.

So far at least, the Russians have been mostly singling out not political content but genuinely distressing material posted by Russian-speaking users.

On Friday, Facebook took down a page globally that was connected to suicide after it was flagged by the Russian regulatory agency, called the Federal Service for Supervision in Telecommunications, Information Technology and Mass Communications, known by its acronym Roskomnadzor. A spokesman for the agency had told Facebook it had until Sunday to comply or risk being blocked in Russia.

For Facebook, the response turned out to be an easy decision. Everybody concerned — the company, the government and opposition figures — agreed the suicide-themed user group was not a friendly page. The group, called “Club Suicid,” was deemed serious enough not to be sheltered by Facebook’s criteria for “controversial humor.”

“We reviewed the content and it was removed because it violated our terms of use,” the company said in a statement.

Facebook says it also complies with local legislation to ban content in certain countries, though that was not the reason for removing the page in this case.

“Notable examples of where most services, including ours, will I.P.-restrict access for certain counties are in Germany” and in France, where it blocks content related to Holocaust denial, and in Turkey, where content defaming the country’s founder, Mustafa Kemal Ataturk, is blocked, Facebook said in its statement.

The spokesman for the Roskomnadzor agency, Vladimir Pikov, said that a separate government agency, Rospotrebnadzor, a consumer-protection organization intended to ensure the safety of food and consumer goods, had made a determination that the Facebook post promoted suicide, and was thus a public health threat.

Twitter, the microblogging site, in March began complying with Russian requests to remove posts — two because they appeared to be related to an attempt to deal in illegal drugs and three posts for “promoting suicidal thoughts,” according to a statement issued March 15 by Roskomnadzor. Twitter has been “actively engaged in cooperation,” the statement said.

Izvestia, a Russian newspaper, reported that Twitter and the Russian agencies’ officials had been in negotiations since November to create a mechanism for selectively blocking Twitter posts inside Russia.

Anton Nosik, a blogger and journalist in Russia, called the law in a telephone interview “absurd, harmful and absolutely unnecessary.” But, he said, so long as regulators focus on genuinely macabre material like sites visited by people fascinated by suicide, he is not overly concerned about a crackdown on the videos and Web pages in the Russian blogosphere. “The track record of the authorities shows they are not going to enforce it strictly.”

Article source: http://www.nytimes.com/2013/04/01/technology/russia-begins-selectively-blocking-internet-content.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Box, a Data Storage Company, Prepares to Expand in Europe

March 31, 2013 by Leave a Comment

Aaron W. Levie, 28, chief executive of the privately held company, said he planned to hire about 100 people in sales, marketing and product development in Paris and Munich by the end of the year, creating a base to capture other fast-growing markets for cloud-based data storage, including Japan, Singapore, Australia and Brazil.

In cloud computing, computer servers are linked to handle many tasks, like simplifying the filing and sharing of data online for companies and governments that rent them for far less than it would cost to build their own infrastructure. Box, on the smaller side of the industry, owns 10 data centers around the world and plans to add more.

Box, based in Los Altos, Calif., is in a crowded field: Amazon Web Services is the leader, while Microsoft, I.B.M., Hewlett-Packard and Google are major players.

The company raised $150 million from investors last year to finance efforts to expand internationally to compete with prominent rivals like DropBox, based in San Francisco, which opened its first overseas office last year in Dublin.

“Right now we’re in aggressive expansion mode because international expansion is really key to our strategy,” Mr. Levie said in an interview in London, where he announced the plans for Europe.

While he would not provide numbers, Mr. Levie said business was increasing significantly in “Europe and beyond.”

The planned expansion to Paris and Munich, he said, was part of preparations for an anticipated initial public offering in 2014. Although the company does not disclose profit figures, Mr. Levie said that he valued the company at about $1 billion.

Box, which employs about 700 in its American offices, recruited 40 more people last June for its operation in London. In September, it hired David Quantrell, a former executive at McAfee and Hewlett-Packard, to lead its business in Europe, the Middle East and Africa.

Box says it has 150,000 business clients, and 10 million other users, charging them as little as $15 a month.

No more than 15 percent of Box’s revenue comes from overseas, Mr. Levie said, a figure he hopes to double in the next couple of years.

Box said recently that it had signed its biggest contract yet, with the French engineering company Schneider Electric, which will use Box exclusively for its 50,000-member work force.

Other Box clients include EMI Music, Volkswagen, the digital music service Spotify and Heathrow Airport Holdings, which operates Heathrow Airport.

Box says its services allow business clients’ employees to organize their work on multiple devices like tablets and cellphones while integrating other software like Google Docs or Salesforce.com, a Web application that helps handle large amounts of customer data.

Hervé Coureil, chief information officer at Schneider Electric, said that cloud-based storage could help companies that operate globally by cutting costs, and by providing a centralized way of tracking how they share files internally and externally.

American businesses have been faster to embrace the cloud, according to the market research company IDC, with Europe lagging because of worries about data security, regulations and legal jurisdictions.

IDC also said that the market for cloud-based services in the 27-member European Union was expected to grow to 10.9 billion euros, or about $14 billion, by 2014, from 4.6 billion euros in 2011.

While the size of the market is still small when measured by revenue and number of users, demand is “hot and growing,” said Alys Woodward, an analyst at IDC who covers software and services in Europe.

“It’s where an easy-to-use cloud service is going to cannibalize huge, more complex services like Microsoft’s SharePoint,” she added. SharePoint is a Web platform that helps people collaborate and share information over a corporate network.

About two-thirds of European companies use cloud-based computing for at least some of their needs, primarily to handle e-mail traffic, according to an IDC survey of 1,056 companies last year.

But Box sees an opportunity because those companies are not yet using the cloud to run the bulk of their businesses, including so-called content management services, the segment in which Box is aiming to grow.

While businesses are unlikely ever to switch completely to the cloud and are expected to retain data on proprietary hardware devices, “over time it will be a nice enhancement,” said Alan Pelz-Sharpe, a research director at 451 Research.

Article source: http://www.nytimes.com/2013/04/01/technology/box-a-data-storage-company-prepares-to-expand-in-europe.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

News Analysis: Calculating Impact of Cyprus’s Bank Bailout

March 31, 2013 by Leave a Comment

The magnitude of the losses, disclosed late Friday and confirmed Saturday by Cypriot officials, has provoked concern that depositors in second-tier euro zone banks in Slovenia and Italy might withdraw their savings from those institutions.

It has also raised fears that countries like Malta and Luxembourg, which like Cyprus have banking sectors many times bigger than their economies, might soon find it harder to gain access to international bond markets.

One relevant lesson might lie not elsewhere in the euro zone but in the carcass of a Los Angeles-based savings and loan institution, IndyMac Bancorp, that failed five years ago and required a bailout. IndyMac was about the size of the Bank of Cyprus, and its depositors ended up taking nearly as big a loss — 50 percent on deposits above the levels insured by the Federal Deposit Insurance Corporation. Rather than causing a panic and a bank run elsewhere, IndyMac’s debacle proved to be a largely contained disaster with little fallout.

“Just as you did not see mass panic and deposit runs in the U.S. after IndyMac, what happened in Cyprus is not going to spill over into Europe,” said Jacob Funk Kirkegaard, a specialist in banking and government debt at the Peterson Institute for International Economics in Washington.

IndyMac needed rescuing because, like the Cypriot bank, it placed a large bet just before one of the biggest recent credit disasters. For IndyMac, the calamity was the collapse of the subprime mortgage market in the United States. For the Bank of Cyprus, it was the collapse of Greek government bonds, in which it and other Cypriot banks had invested heavily, seeking an adequate return on the billions of euros of deposits that had inflated their balance sheets.

“How unique is Cyprus? Pretty unique actually,” Mr. Kirkegaard wrote in a research note.

He pointed out that compared with other countries with huge banking systems relative to their economies — notably Malta, at about eight times gross domestic product, and Luxembourg at more than 22 times G.D.P. — Cypriot banks had much lower levels of equity to cushion against failing assets. What is more, it is the subsidiaries of foreign banks, which have little or no exposure to the local economies, that make up the bulk of the Maltese and Luxembourg banking systems.

By comparison, many of the Cypriot banking assets that grew to be seven times the size of the country’s economy consisted of corporate, construction and mortgage loans to the Cypriot and Greek economies, which tied the health of these banks directly to those sagging economies.

As proponents of the Cypriot losses argue, just as it was fair that the large depositors that bankrolled IndyMac’s subprime excesses in 2008 pay the cost for the bank’s failure, so it is right that Cypriot savers — the largest of whom were Russian billionaires chasing high-yielding deposits — suffer a similar fate.

“There were stories of pain, too, at IndyMac, but in the U.S., we paid little attention to it,” Mr. Kirkegaard said. “This will impose a lot of pain on Cypriot society, but the outcome will not be that much different.”

IndyMac, when it was rescued by American regulators in July 2008, had become the ninth-largest originator of mortgage loans in the United States, relying largely on large, uninsured deposits to finance a lending spree in some of the riskiest areas of the housing market.

And while the American government backed savers with deposits of less than $100,000, those with more deposited at IndyMac were required to accept a loss of 50 percent when it declared bankruptcy. (The federal government helped prevent a broader panic by later raising the deposit insurance threshold to the current $250,000.)

As the Cypriot government begins investigating the misadventures of the Bank of Cyprus and the second-largest, Laiki, bankers and lawyers in Nicosia have begun to argue that the disastrous venture by the Bank of Cyprus into Greek bonds could well have been avoided.

Local bankers say the bank had more or less sold out of its Greek bond position by early 2010 as Greece’s problems became evident.

Article source: http://www.nytimes.com/2013/04/01/business/global/calculating-impact-of-cypruss-bank-bailout.html?partner=rss&emc=rss

Filed Under: Economy News Tagged With: , ,

Despite Setbacks at Big Banks, Pay Rises for Board Members

March 31, 2013 by Leave a Comment

Since the financial crisis, compensation for the directors of the nation’s biggest banks has continued to rise even as the banks themselves, facing difficult markets and regulatory pressures, are reining in bonuses and pay.

Take Goldman Sachs, where the average annual compensation for a director — essentially a part-time job — was $488,709 in 2011, the last year for which data is available, up more than 50 percent from 2008, according to Equilar, a compensation data firm. Some of the firm’s 13 directors make more than $500,000 because they have extra responsibilities.

And those numbers are likely to skyrocket for 2012 because the firm’s shares rose more than 35 percent last year and its directors are paid in stock. Goldman Sachs is expected to release fresh pay data in the coming weeks.

Goldman’s board is the best compensated of any big American bank and the fifth-highest paid of any company in the country, according to Equilar. Some of its rivals are not that far behind. The nation’s biggest banks paid their directors over $95,000 a year more on average in 2011 than what other large corporations paid.

Goldman defends the board’s pay, saying that the bulk of the compensation is in stock that directors cannot touch until after they have left the board.

That arrangement, the firm says, aligns directors’ interests with those of shareholders.

“The board’s pay is set at a level that reflects the firm’s long-term performance as well as directors’ substantial time commitment and the increased demands placed on them in recent years by new laws and regulations,” said David Wells, a Goldman spokesman.

More broadly, banks and compensation experts say, financial firms must now pay a premium to entice and keep qualified directors.

After the financial crisis, some financial firms’ boards were criticized for being asleep at the wheel and not understanding the risks being taken. Recruiters say banks are redoubling efforts to recruit directors with more financial expertise who can exercise better oversight.

Yet it is also a balancing act, because too much pay may end up giving boards an incentive to not rock the boat.

Some Wall Street insiders also question the need to pay bank directors more than their counterparts at other big corporations, arguing that the increased regulation has actually limited bank boards’ ability to perform important tasks, like raising capital and issuing dividends. Even when it comes to paying senior executives, boards have less leeway because regulators have pressured boards to bring down executive pay.

“About the only thing bank directors have more of these days is meetings,” joked one senior Wall Street executive who has frequent interaction with his board but spoke on the condition he not be named because he was not authorized to speak on the record.

“Regulators have all but stripped boards of the main powers they had before the crisis.”

After Goldman, Morgan Stanley’s director pay is the second highest on Wall Street, with an average of $351,080, roughly the same as it was in 2008 but much higher than the pay at bigger and more complicated rivals like JPMorgan Chase and Citigroup.

Board pay at Morgan Stanley has drawn criticism from Daniel S. Loeb’s hedge fund, Third Point, which recently bought 7.8 million shares, or a 0.4 percent stake, in the firm. While praising Morgan Stanley and its management, Mr. Loeb said in a letter to investors how “surprised” he was about how much its directors received.

“We hope Morgan Stanley will show that its reinvention begins at the top and set an example for the company by quickly revising its board practices,” he wrote.

At Citigroup, directors make an average of $315,000 a year, according to Equilar, up 64 percent from 2008. The value of the annual cash retainer and deferred stock award Citigroup directors receive has not changed since 2005, but the pay for additional work, like leading a committee, has risen.

Of the five financial institutions to have reported director pay for 2012, JPMorgan is the biggest, but it gives its directors compensation, on average, worth $278,194 each. Only Bank of America, where directors are paid $275,000 each, pays less.

All told, the average compensation for a director at one of the six biggest banks in 2011 was $328,655, according to Equilar. This compares with $232,142 at almost 500 publicly traded companies analyzed in a study by the executive search firm Spencer Stuart. In 2012, that number rose to $242,385.

Article source: http://www.nytimes.com/2013/04/01/business/despite-setbacks-at-big-banks-pay-rises-for-board-members.html?partner=rss&emc=rss

Filed Under: Economy News Tagged With: , ,

Discovery Expands Its Reach Overseas to Ensure Growth

March 31, 2013 by Leave a Comment

“Here Comes Honey Boo Boo,” the reality show on TLC in the United States, has become an unlikely hit in Brazil and dozens of other countries where it is broadcast on some of TLC’s 150 international channels. To help explain its particularly American milieu and language, the episodes come with a glossary of common terms: “concurso de brillo” in Spanish for “glitz pageants”; “gorduchéte” in Portuguese for “chubette.”

The series and its popularity overseas are just one aspect of Discovery’s growing international business. The company, based in Silver Spring, Md., owns 14 domestic cable channels including Discovery, OWN: The Oprah Winfrey Network and Animal Planet, but its executives see growth coming from places like Brazil, Mexico and Russia.

“We don’t see ourselves as a domestic media company,” said David M. Zaslav, Discovery Communications’ president and chief executive, in a phone interview from Moscow, where he was visiting with the company’s 32 local employees. (The week before, he had business meetings in Paris, Switzerland and Belgium.)

Discovery’s strategy signals how the cable television business in the United States is maturing. With a proliferation of channels competing for a diminished number of total viewers, media companies have looked elsewhere for growth.

Last year, News Corporation paid $335 million to complete its acquisition of the Singapore-based ESPN Star Sports, previously a joint venture with the Walt Disney Company. Viacom has in recent years expanded its footprint in Russia, Eastern Europe and Latin America. In India, the company owns Colors, a Hindi-language general entertainment pay TV channel.

“You have many markets with substantial G.D.P. growth ahead of them and multichannel infrastructure growth,” Robert M. Bakish, president and chief executive of Viacom International Media Networks, said in an interview last year. “TV in the U.S. is pretty well saturated.”

Discovery has channels in 217 countries and territories in 45 languages as well as 1.3 billion subscribers outside the United States. In the six years since Mr. Zaslav took over as chief executive in 2007, the company has grown from making around $720 million in total profits, with roughly $120 million coming from overseas, to making $721 million just from its international business, or 34 percent of its total profit of $2.1 billion, in the fiscal year that ended Dec. 31.

In the coming weeks, Discovery is expected to close its biggest deal yet: a $1.7 billion acquisition of SBS Nordic, a Scandinavian programmer that includes 12 television networks, radio stations and digital assets in Denmark, Finland, Norway and Sweden.

The SBS deal came around the time Discovery agreed to pay about $240 million for a 20 percent stake in Eurosport, a Pan-European cable sports channel that broadcasts tennis, cycling and cross-country skiing and other sports in 59 countries, and other pay television assets owned by the French media company TF1 Group. The transaction gives Discovery the chance to take majority ownership of Eurosport in two years.

After the SBS acquisition closes, more than 40 percent of Discovery’s business will come from abroad, making the company the biggest among its competitors in the international cable television business. On Thursday, Discovery will hold its annual upfront presentation to unveil its business and programming plans to advertisers and reporters.

Thirty-eight percent of Discovery’s revenue last year came from its international business, compared with 44 percent for News Corporation, 29 percent for Viacom and 28 percent for Time Warner, according to Wall Street estimates in Discovery’s latest investor presentation.

Article source: http://www.nytimes.com/2013/04/01/business/media/discovery-expands-its-reach-overseas-to-ensure-growth.html?partner=rss&emc=rss

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Critic’s Notebook: Game Developers Conference Celebrates Indie Creators

March 31, 2013 by Leave a Comment

But futuristic gadgets weren’t the only innovations on display at the Moscone Center here, where independent designers who make text adventures and other lo-fi games can seem like bigger stars than the ones who make blockbusters. All told more than 20,000 people attended the conference last week.

When I dropped by the “ ‘AAA-level design in a day’ boot camp” on Tuesday — AAA being industry jargon for big, mainstream titles with multimillion-dollar budgets — the room was a quarter-full at best. A few hours later a near-capacity crowd of about 1,000 started queuing up more than 30 minutes in advance for a series of five-minute talks known as the “indie soapbox.” Ushers held up fingers and guided people to the few remaining seats.

Indies also dominated the Game Developers Choice Awards, which were handed out Wednesday night. Journey, a downloadable game made by the independent studio thatgamecompany for the PlayStation 3, became the first independent title to win the game of the year award. Past winners were blockbusters like Gears of War, Grand Theft Auto III and the Sims.

By the end of that night Journey — which is, to be fair, decidedly high tech, gorgeous and the climax of a three-game contract between Sony and thatgamecompany — had won 6 of the 11 awards. FTL: Faster Than Light, an independent game financed by a Kickstarter campaign — asking for $10,000 and receiving more than $200,000 — won the award for best debut.

Just two prizes went to games developed by mainstream studios. The award for best technology went to Far Cry 3, an open-world, first-person shooter published by Ubisoft. The audience award went to Dishonored, from Arkane Studios.

“The system we’re fighting kind of likes us now,” said Andy Schatz, an indie game designer who hosted the Independent Games Festival Awards, which preceded the Game Developers Choice Awards. “Like it or not, we’re not the Clash anymore. We’re Green Day.”

Eric Zimmerman, a game designer and an instructor at the New York University Game Center, gave a similar explanation for why he is canceling the Game Design Challenge that he has held at the conference for the past 10 years. This year’s was the last, he said. “The idea of doing strange, bizarre, experimental games is no longer strange, bizarre or experimental,” Mr. Zimmerman said.

Naturally an independent designer, Jason Rohrer, won the 2013 challenge. The theme was “Humanity’s Final Game,” and Mr. Rohrer designed a game within a game. He first constructed a board game made of titanium and buried it — along with playing instructions, encased in glass — in the Nevada desert. He then provided the audience with envelopes that, in aggregate, contained more than a million GPS locations where the game might be found. Mr. Rohrer estimated that it would take one person more than 2,000 years to locate his game, as yet unplayed.

Big companies like Sony and Nintendo were at the conference, but they used much of their time to emphasize their desire to work with independent developers rather than to show off their own wares. Sony ran a “PlayStation Indie Arcade” to promote new and current titles. The arcade culminated in a tournament of Johann Sebastian Joust, a screenless game during which selections from Bach’s “Brandenburg” Concertos play while competitors try to jostle the motion-sensitive controllers in their opponents’ hands while holding still the controllers in their own.

“There’s always been cool, experimental stuff going on in the indie space, but it’s broadened its reach,” said Steve Gaynor, a co-founder of the Fullbright Company, a studio that consists of four people in a house in Portland, Ore. “It’s become a lot more viable, business-wise, to be an indie.” (The Fullbright Company’s forthcoming game Gone Home was nominated for excellence in narrative at the independent awards.)

Because of digital distribution, game designers no longer need to have contracts with publishers — which might once have secured them vital shelf space at Walmart — to succeed financially, Mr. Gaynor said. Beyond money to pay for licensed music and some voice acting, Gone Home’s budget basically pays for food and rent and living expenses for four people. “Our burn rate is really low,” he said.

Leigh Alexander, the editor at large for Gamasutra — a trade Web site owned by the same company that runs the Game Developers Conference — was heartened by the indie invasion. She tweeted her one-sentence take-away: “The good guys are finally winning.”

Yet she was also on a conference panel that confronted the industry for not doing enough to make women feel accepted — as designers, as players, as conferencegoers. The indie crowd is still, like the studio system, largely a men’s club. (Of the 10 indie soapbox speakers 9 were men.)

“You’re either doing it, or you’re not,” said Robin Hunicke, a designer who has worked on games like Journey and the Sims 2 and who recently was co-founder of an independent studio. “You’re actively working to broaden participation in our industry, or you’re in the way.”

Every designer starts out as a player, noted Kim McAuliffe, a designer at Microsoft Studios who most recently worked on the children’s game Kinect Nat Geo TV. The limited number of playable female characters — Ms. McAuliffe could remember only Chun-Li from Street Fighter II and the princess in Super Mario Bros. 2 from her childhood — necessarily limits the audience for female players, she said, and thus reduces the number of female game designers.

Ms. McAuliffe also said she was uncomfortable with the large number of games that involve shooting human characters. “I worked on Socom 4,” a military shooter, “but it made me uncomfortable every time I played my own levels,” she said.

The number of women in the industry is growing, said Brenda Romero, the game designer in residence at the University of California, Santa Cruz, and the creator of acclaimed board games, like Train, about the Holocaust. After all, she said, “2006 was the first year there was a line at the women’s bathroom at G.D.C.” But, she added, industry traditions like the “booth babes” at the annual Electronic Entertainment Expo, known as E3, need to end before women will feel fully welcome.

Ms. Romero’s 12-year-old daughter told her that her dream was to make a video game with her. For now, though, Ms. Romero is unwilling to take her daughter into what she called E3’s “sexually charged environment,” one that she compared to a leering crowd at a construction site.

Appealing directly to the organizers of E3 Ms. Romero concluded the panel by saying, “Please change this, so I can bring her there.”

Article source: http://www.nytimes.com/2013/04/01/arts/video-games/game-developers-conference-celebrates-indie-creators.html?partner=rss&emc=rss

Filed Under: Media Business Tagged With: , ,

Bassem Youssef Posts Bail as Egyptian Authorities Press Case

March 31, 2013 by Leave a Comment

After presenting himself to prosecutors on Sunday morning for questioning that lasted several hours, the satirist, Bassem Youssef, paid the equivalent of $2,200 bail and was released. Prosecutors had issued an arrest warrant for Mr. Youssef on Saturday on charges stemming from statements he had made on his widely watched television show, including that he had insulted Mr. Morsi, denigrated Islam and disturbed public peace.

Human rights advocates and members of Egypt’s political opposition seized on the warrant as evidence that Egypt’s first freely elected leader had grown impatient with his many critics and was using authoritarian tactics to limit freedom of expression. Similar criticisms were leveled at the government last week, after the public prosecutor issued warrants for five anti-Islamist political activists for things they had written on social media.

Since Mr. Morsi took office in June, prosecutors in at least two dozen cases have been asked to look into charges of insulting the president, according to a human rights lawyer, Gamal Eid. Few of those cases, however, have resulted in arrest warrants.

Mr. Eid said the decision to order bail for Mr. Youssef indicated that the case was continuing, and he raised the possibility that the satirist could be summoned to answer more questions or be referred to court. “He could have been released without bail,” Mr. Eid said. “This is legal, but we think it’s arbitrary.”

In a statement from Mr. Morsi’s media office on Sunday, the president seemed to distance himself from the investigation, saying that the public prosecutor, Talaat Ibrahim, whom Mr. Morsi appointed in November, “operates independently from the presidency.”

“The current legal system allows for individual complaints to be brought to the prosecutor general,” the statement said. “All the current well-publicized claims were initiated by citizens rather than the presidency.”

The statement also said the presidency could not comment on active legal cases, but “respects freedom of speech and the press.”

At the very least, the interrogation of Mr. Youssef seemed to represent a public relations misstep for the government. Mr. Youssef, a heart surgeon who volunteered in a Tahrir Square field hospital during the uprising against President Hosni Mubarak, has struck a nerve in Egypt with a show that mines Egypt’s chaotic and frequently absurd post-uprising politics.

Sunday was no exception. Mr. Youssef appeared at the High Court wearing an enormous black hat — modeled on one that Mr. Morsi wore while receiving an honorary degree in Pakistan last month. As he waited to be questioned by prosecutors, Mr. Youssef posted sarcastic observations on Twitter, including that the investigators felt the need to ask him about the color of his eyes.

“The officers and the lawyers of the public prosecutors office want to take pictures with me,” he wrote. “Is this the reason for the summons?”

Later, some of the tweets were deleted. A spokesman for Mr. Youssef was not immediately able to say why.

Article source: http://www.nytimes.com/2013/04/01/world/middleeast/bassem-youssef-posts-bail-as-egyptian-authorities-press-case.html?partner=rss&emc=rss

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Disney Junior Challenges Nick Jr. in Preschool TV

March 31, 2013 by Leave a Comment

Nick Jr. has long been cable television’s No. 1 channel dedicated solely to preschool children. The service, owned by Viacom, had a smash hit in “Dora the Explorer,” which made its debut in 2000. Competition was also light: the Walt Disney Company, preoccupied with hunting for preteenagers, operated no 24-hour preschool channel.

But in the year since Disney introduced Disney Junior, a channel aimed at the tiniest of viewers, Nick Jr. ratings have plummeted more than 50 percent, according to Nielsen. On Tuesday Nielsen data for Disney Junior will be revealed for the first time; the new channel is expected to beat its rival, even though Nick Jr. is available in 75 million homes, 25 percent more than Disney Junior.

Disney now has the top three preschool cable programs, led by what appears to be a monster-size new hit, “Sofia the First,” a cartoon that stars a pint-size princess and her zany animal friends.

Although ad revenue is small — Disney Junior accepts limited sponsorships; Nick Jr. allows advertising aimed at mothers, but only a bit — the potential payoff in the toy aisle is huge. Even at 13, “Dora the Explorer” generates about $1 billion annually in global retail sales. “People have been saying ‘Dora is dead’ for years, but the old girl still has a strong following,” said Chris Byrne, a toy analyst.

Merchandise related to Disney Junior shows is already catching fire among retailers. Disney said it expected sales to surpass $1.5 billion in its current fiscal year, a 50 percent increase from last year.

“A massive, massive success” is how Richard Barry, chief merchandising officer for Toys “R” Us, described products related to “Doc McStuffins,” a new Disney Junior hit about a girl who runs a clinic for her toys. One doll sold out so fast it soon traded on eBay for $300.

Animated preschool shows also draw strong audiences in reruns, and some easy dubbing makes them a valuable overseas export. Beyond all of this, the value of future brand loyalty is incalculable. Anne M. Sweeney, president of the Disney-ABC Television Group, has devised her fast-growing TV portfolio to retain children as they grow, just as Viacom tries to hook toddlers into the Nickelodeon family.

Disney’s hope is that they will start with Disney Junior; migrate to the Disney Channel, aimed at ages 6 to 14; and then move on to boy-centric Disney XD or ABC Family, which is on a hot streak of its own. “These children are the Walt Disney Company’s most important audience,” Ms. Sweeney said. “They’re the future, and this is their first introduction to our brand.”

Preschool television has long been a rough and tumble playground, with broadcasters competing against upstart cable channels. Children ages 2 to 5 spend an average of 32 hours in front of a TV each week, according to Nielsen. But competition is increasing. For media companies, this represents an area of growth and, as more children move to mobile devices, there is more pressure to keep their attention.

The battle has moved to apps, with Nickelodeon, Disney and Sesame Workshop, producer of PBS’s “Sesame Street,” competing to funnel preschool shows to iPads — by some measures the new electronic baby sitters.

Nickelodeon in particular is fighting back at Disney Junior. Last month, it unveiled four new preschool programs, including a spinoff of “Dora the Explorer.” Another new series called “Wallykazam!” tries to teach literacy, embedding a reading curriculum in a plot that involves a boy and his pet dragon, Norville.

Not to be counted out is Sprout, a channel largely stocked with PBS shows like “Thomas Friends” that has grown steadily since becoming part of NBCUniversal in 2011. Sprout is pushing new merchandise of its own and has increased marketing efforts, entering a float, for instance, in last year’s Macy’s Thanksgiving Day Parade.

Preschool entertainment is a politically delicate area filled with advocates who recoil at TV aimed at children as young as 2. “There continues to be a lot of anxiety from parents over how much TV is too much,” said Dade Hayes, author of “Anytime Playdate: Inside the Preschool Entertainment Boom, or How Television Became My Baby’s Best Friend.”

Even so, Mr. Hayes, who is also executive editor at the trade publication Broadcasting Cable, noted that there had been surprisingly little commotion over “Sofia the First.” That show was considered risky because — while rooted in teaching social skills — it is more driven by entertainment than overt education. Princess Sofia, wearing a purple gown and tiara, attends a prep school run by the three fairies from “Sleeping Beauty.”

Nickelodeon’s preschool offerings are known for engaging characters mixed with eat-your-broccoli educational messages; one hit, “Ni Hao, Kai-Lan,” aims to teach children some Chinese. “We were in the trenches talking to kindergarten teachers and brain experts,” Teri Weiss, executive vice president for production and development at Nickelodeon Preschool, said of the development of “Wallykazam!”

She added: “There are competitors that dabble in education.”

Article source: http://www.nytimes.com/2013/04/01/business/media/disney-junior-challenges-nick-jr-in-preschool-tv.html?partner=rss&emc=rss

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