December 6, 2019

You’re the Boss Blog: My Competitors Don’t Seem Interested in ‘Coopertition’

Fashioning Change

A social entrepreneur tries to change the way people shop.

I recently had a conversation with a man from Spain whose wife runs an e-commerce company that is based here in the United States but serves the Spanish market. The business sells car accessories. He was telling me about a time when she ran out of a particular item and called up her competitors, who supplied the inventory she was missing.

Not only did they supply the inventory, they declined to charge her for it. And it was understood that she would return the favor someday. I asked him if this kind of cooperation — sometimes known as coopertition — was unique to his wife and the competitor or a common practice in Spain. He said that working with a competitor is not uncommon in Spain. In fact, he said, he finds it weird that businesses in the United States do not try it more often.

I’m friendly with some of my company’s competitors and reach out to them every six months or so to see how they are doing, to discuss challenges, and to see how Fashioning Change might be of help. The conversation I had with the Spanish owner reminded me that I had been wanting to get several of the other “shopping for good” marketplaces on a call together to discuss the landscape, to review opportunities to work together and to see what we might do together to help sustainable and fairly made clothing brands.

Because my company provides a platform for sales of emerging brands, it is important to me to make sure they understand the risks they take when they start discounting aggressively. I’ve chatted with some of these brands, and, of course, they understand the need to build their brand identities. But there are also times when they feel the need to clear inventory so they can go back to their fair-trade factories and produce another collection that will feed their workers’ families.

While this approach is understandable, I fear it can damage a business model. And this is what I wanted to discuss with the owners of other social marketplaces. I thought that we could talk about how to help these emerging brands. And that’s why I sent an e-mail to three chief executives in my industry. I heard back from only one — after the date of the proposed call. We set two dates to speak, and I was stood up both times. I know the e-mails were received by the other two chief executives because I spoke on a panel with one of them, where he acknowledged that he owed me an e-mail, and because the other has made multiple visits to Fashioning Change since the e-mail was sent out.

Personally, I believe there is more to be gained from building friendly bridges than working in opposition. The majority of online shoppers buy products that are not made fairly or sustainably. There is much social justice (and profit) that can be achieved by four companies with overlapping visions that work together — especially if we take market share from the thousands of e-commerce companies selling goods that are mass-produced in sweatshops with little concern for the workers or the environment.

The chief executives I reached out to are all running social ventures. For Fashioning Change, operating in this space means we pursue the so-called triple bottom line: people, planet and profit. As a result, we often do things that typical companies may perceive as crazy. When I first suggested reaching out to our competitors, Kevin, my co-founder, was skeptical but hopeful that the other companies would respond.

Given our experience, I’m wondering if coopertition in the United States is a pipe dream. What do you think? Have you tried anything like this with a competitor? If one of your competitors approached you, would you be open to the concept?

Adriana Herrera is chief executive of Fashioning Change. You can e-mail her at adrianah@fashioningchange.com, and you can follow her on Twitter at @Adriana_Herrera.

Article source: http://boss.blogs.nytimes.com/2013/07/12/my-competitors-dont-seem-interested-in-coopertition-2/?partner=rss&emc=rss

Manufacturing Gains Strength, But Hiring in Sector Stays Weak

A separate report on Monday showed that construction spending neared a four-year high in May, a sign that it has regained some strength after having collapsed in the 2007-2009 recession. Even with consumer and housing data pointing to a steadily improving recovery, pockets of concern remain, particularly jobs.

The Institute for Supply Management said its index of national factory activity rose slightly more than expected in June, to 50.9 from 49, with a reading above 50 indicating expansion. The gauge for new orders rose to 51.9 from 48.8, while production jumped to 53.4 from 48.6, helping the overall index bounce back from a contraction in May — the first in six months.

“It’s nice to see manufacturing moving back into growth territory from contraction,” said Joel Naroff, president of Naroff Economic Advisors in Holland, Pa.

But a measure of employment fell to 48.7, the lowest reading since September 2009. It was 50.1 in May. That could feed concern about the strength of the recovery, particularly since the Fed has said it could begin to wind down its stimulus this year.

“The employment issue is key,” Mr. Naroff said. “If those jobs are not there, you are not going to get consumer demand.”

A separate index from Markit, also showed modest growth in manufacturing, but recorded sharp slides in hiring and new orders from abroad.

“Firms are responding to the increasingly worrying order-book trend by pulling back on recruitment,” said Chris Williamson, Markit’s chief economist.

Construction spending neared a four-year high in May, though difficulties in the commercial real estate and factory sector subdued the pace of recovery.

Article source: http://www.nytimes.com/2013/07/02/business/economy/manufacturing-gains-strength-but-hiring-remains-weak.html?partner=rss&emc=rss

Economix Blog: Long-Term Jobless: Still a Bleak Picture

Long-term unemployment remains a very dark shadow in the May jobs report: 4.4 million workers have been out of a job for more than six months. In essence, the job market has normalized for the short-term unemployed. But the longer you have been out of a job, the bleaker the picture gets.

The number of people who report being out of work for less than five weeks has returned to almost the same level as in 2007. But the number of people unemployed 5 to 14 weeks is about 25 percent higher. For those out of a job 15 to 26 weeks, it is 78 percent higher. And the number of long-term jobless, those unemployed for more than 27 weeks, is a whopping 257 percent higher.


The long-term unemployed are struggling mightily to get rehired, as confirmed by recent research by Rand Ghayad and William Dickens of the Federal Reserve Bank of Boston. Some economists have theorized that the unusually long spells of unemployment we have seen in the wake of the recession are caused by a “mismatch”: The long-term jobless were in obsolete professions, with obsolete skills, and that is why they are not getting new gigs.

But Mr. Ghayad and Mr. Dickens argue that is not the case. The long-term jobless seem to be having trouble finding work across industries, for instance. Discrimination does seem to be a major factor, though: Employers simply do not want to hire the long-term jobless, as my colleague Catherine Rampell has reported and further research by Mr. Ghayad has shown.

Granted, the number of long-term jobless has come down sharply over the last three years, declining to a current level of 4.4 million from a high of 6.7 million in early 2010. Much of that reduction came about because the long-term jobless found jobs — it is not just about workers dropping out of the labor force. Still, the reality remains that the longer a worker is out of a job, the slimmer and slimmer the chance of being rehired.

Article source: http://economix.blogs.nytimes.com/2013/06/07/long-term-jobless-still-a-bleak-picture/?partner=rss&emc=rss

You’re the Boss Blog: Fighting the Consultant Temptation

The Next Level

Avoiding the pitfalls of fast growth.

Most small businesses won’t touch them with a 10-foot pole, but corporate America has had a long, slobbering love affair with them. I am talking about consultants. The question is, should fast-growth companies use them?

My answer is yes — under certain conditions. Most important, make sure they have actually accomplished what you are trying to do and not just what they are trying to sell. And sorry, but this does not include what they have done for other clients; they have to have done it for themselves. For example, if you want to expand to 500 people, from a staff of 50, you want someone who has experienced this as chief executive, chief financial officer or maybe as head of human resources. The dynamics of that journey will never be understood except by those who have taken it.

This is why I often encourage fast-growth companies to look for mentoring rather than consulting. I have found that most people who have really done it themselves are not interested in the world of consulting — but they are glad to take phone calls, attend meetings or just be there when you need them. I had a mentor, and his only requirement was that I run with him every morning at 5:30. Believe me, there were mornings when I wished I was paying a consultant rather than running 6.2 miles. But my mentor enjoyed the run, and I needed the help, whether I wanted to hear it or not.

Still, sometimes, you really do need a consultant — but it’s not going to help unless you find the right one. When my company, STI Knowledge, reached 200 employees, we tried to transition from QuickBooks to Great Plains accounting software (now Microsoft Dynamics). The consulting firm we chose to help us had about 25 people, and it was fine to get us set up. But in the next six months, we added 150 people, and the accounting system started going up and down 15 times a day. We didn’t really panic until it started providing incorrect numbers. At that point, we couldn’t balance, bill or pay. All the chief executive of the consulting firm could say was, “You don’t understand how much stress you are putting on the system. Have you ever heard of an anxiety attack?”

“Yes, I have,” I responded. “You are giving me one. I am living it 24/7.” I soon learned the consulting firm did not have a clue how to make the system work with our growth rate. I was advised to hire one of the big consulting firms, which would come in and straighten it out. And I did reach out to the big firms, but they all wanted the long, slobbering love affair — the critical success report and scope-of-work analysis before they would touch the nuts and bolts of the system.

I told them the foreplay was unnecessary: “Just fix the system and I will pay you 100 grand.” They wouldn’t do it, so I picked up the phone and called Great Plains. I told them I did not want a recommendation of another value-added reseller. I wanted to know all the companies within a 50-mile radius of us that had installed Great Plains in the previous three years. They eventually agreed and started citing names, and we hit pay dirt on about the 15th one: MindSpring Enterprise, the Internet service provider.

My next call was to the controller of MindSpring who did not know me but had heard of our company. He told me he had been with MindSpring from the early days and that it had more than 1,000 employees. I invited him for lunch that same day and popped the question before we had ordered iced tea: “Who did you use for consultants?” He said that Great Plains had set the system up initially and that it had been his job to manage the growth ever since, using the Great Plains special project division as a resource.

Long story short, I hired Jeff Hayes as our controller, and in three days, our system was functional. In three months, he was a nationally recognized expert on fast growth and Great Plains accounting. He came in as a one-man show and was far more valuable to us than the 25-person or 250,000-person companies. Why? He had done it. He had been where we wanted to go.

What would we have gotten if we had hired one of the big consulting firms? About 70 percent of all expenses in a consulting firm are for payroll. When they figure out what they need to bill hourly, they load it up with all that recurring payroll expense, which includes people and partners who don’t even know your project exists, much less make any contribution to it.

In a fast-growth company, getting cash flow ahead of expenses is a race. You can’t carry people or expenses that do not help you run that race. And don’t convince yourself that you can work out a deal where the consulting firm is paid only on results with no up-front commitment from you — it rarely works, and you will spend more time and negative energy arguing over the bill than trying to get ahead with positive traction and results.

If you must, try paying the consultants a nominal up-front sum on a project basis with a bonus or an hourly basis that covers only their on-site talent costs with a huge upside if the organization gets you where you want to go. I remember one arrangement where we reduced the firm’s hourly rates from $295 an hour to $35 an hour — but the consulting group picked up two nice bonus checks.

Fast companies run on a culture of shared values — like the folks in the early days of Southwest Airlines who wanted low prices to get people off Greyhound buses so the travelers could enjoy their vacations. They know why they are at work, and they know the cause is bigger than they are. It is honest, and it can make a difference in lives. This level of commitment and dedication is not for everybody, and your job in human resources is to figure out who can make the ride and where you can find more high achievers to join in.

This is the human factor of growth, and quite frankly, most consultants contaminate the whole place. Keep them out of this part of the business. Think about snakes in a wood pile. In fact, go back and find that 10-foot pole and grow without them.

Cliff Oxford is the founder of the Oxford Center for Entrepreneurs. You can follow him on Twitter.

Article source: http://boss.blogs.nytimes.com/2013/05/02/fighting-the-consultant-temptation/?partner=rss&emc=rss

Corner Office: LivePerson’s Chief, on Removing Organizational Walls

Q. What were some early leadership lessons for you?

A. I got out of college in 1990. We were in the middle of a recession, and I got a job at a trading company. I was there for six months, and they fired me because they needed to lay people off. I remember they took me to lunch, and they asked me what I took away from the experience. And I said, “I’ll never work for anybody again.”

And then I started my first company. I put $50,000 on credit cards, and I had the idea of bringing interactive kiosks with touch screens to college campuses and selling advertising on them. It was working, but it was a struggle. And the Internet spread quickly, and I had to shut the company down. I lost everything. It was a humbling experience, and I ended up coming to New York. I rented about 400 or 500 square feet from a guy who was making T-shirts down in TriBeCa.

This was the point where everything changed. I was 27, I failed and I was pretty down, and I went to see a therapist named Frank Maurio. He didn’t charge me because he knew I didn’t have money. For two years he worked with me and changed how I perceive the world. And when I took LivePerson public on April 7, 2000, I gave him some shares in the company and thanked him.

Q. What lessons did he teach you?

A. There were a couple of things. One is that, usually, nothing is as bad as it seems. As entrepreneurs, we tend to react to a situation. So if you panic and you bring that emotion, it’ll wear you down. So it was really important to just be centered during the day. The second thing is surrounding yourself with the right people, but I think he changed my understanding of who the right people are. Entrepreneurs in particular want high control. It can be wonderful, and it can be disastrous. He taught me that you don’t want to have people you can control, but you can still control your future and have people who can help you build the company.

The other one is that you have to evolve and change at all times. We have a tendency to be lazy, especially when things are good. So the concept was, you should be in a constant state of evolution as a person, because if you stop, you will end up having to leave, or what entrepreneurs tend to do is they basically self-destruct and hurt the company. They start making bad deals. They hire bad people.

Q. What are lessons you’ve learned from running LivePerson?

A. The last two years have been a real change. We have approximately $160 million in revenue, but when we hit about $100 million in revenue and 500 employees, I could see things evolving in the company that could really hurt us in the long term. We started to become bureaucratic a little bit. You start to add middle management layers. So this dead-weight layer comes in, and their job is just to make sure everyone does their stuff. And then what happens is you become very siloed in many ways, and the managers want control. Then you get infighting, and people are more focused on getting offices and titles, because they ask, “It’s very hierarchical here, so how do I get up the chain?”

Q. Was there a moment when you really felt that culture taking hold?

A. I remember one moment. We had the cubicles in the middle and offices on the outside, and I walked past a small office and noticed two people shoved inside. And I asked them: “Why are you guys shoving yourselves in an office? You were just in cubes out here.” And they said, “Well, we’re directors now, and directors get offices.”

I’d never believed in culture and core values up to that point. But I really became very reflective because I wasn’t so happy with what was happening with the company. I’d seen things that had made me realize we were becoming very traditional. I started to spend more time with a couple other companies, and it made me realize, as a founder, that if I left the company, it could be a totally different place because of the next set of leaders. And that’s what kills companies. So I thought that values were the way to have a long-term sustainable company. I finally said, “It’s time to start making the change in the company.” I came in one day and asked all the leaders to move out of their offices, and that was the start of a painful process of change.

Article source: http://www.nytimes.com/2013/02/10/business/livepersons-chief-on-removing-organizational-walls.html?partner=rss&emc=rss

DealBook: Goldman Sachs to Sell $1 Billion Stake in Chinese Bank

The headquarters of Goldman Sachs in New York.Mark Lennihan/Associated PressThe headquarters of Goldman Sachs in New York.

Goldman Sachs is selling a $1 billion stake in Industrial and Commercial Bank of China, the largest Chinese bank.

The share sale, which was begun on Monday, is the second time in less than a year that Goldman has reduced its holdings in the lender after acquiring its stake before the Chinese bank’s initial public offering in 2006.

Goldman has been selling off its shares as part of a broader effort to reduce its exposure to Industrial and Commercial Bank of China, which has benefited from an almost 50 percent rise in its share price over the six months.

Under the terms of the deal, Goldman will sell Hong Kong-listed shares in the Chinese bank at 5.77 Hong Kong dollars (74 cents) each, according to a person with direct knowledge of the deal who spoke on the condition of anonymity because he was not authorized to speak publicly. The exact number of shares has yet to be confirmed, the person added.

The share sale represents around a 3 percent discount to the bank’s closing share price on Monday.

In April, Goldman also sold $2.5 billion of shares in the bank to the Singaporean sovereign wealth fund Temasek Holdings and other institutional shareholders.

Its investment in the world’s largest bank by market value has proved successful for Goldman. After initially investing around $2.6 billion, Goldman Sachs has raised more than $4.5 billion by progressively selling down its stake in the Chinese bank.

Article source: http://dealbook.nytimes.com/2013/01/28/goldman-sachs-to-sell-1-billion-stake-in-i-c-b-c/?partner=rss&emc=rss

Unemployed Mortgage Holders Get Payment Extension

Freddie Mac and Fannie Mae, the government-sponsored housing finance companies that represent approximately half of all mortgages, have announced plans to extend their existing programs so that unemployed borrowers can defer part or all of their monthly payments for up to 12 months while they are out of work.

The moves come after the Obama administration announced last July a similar program for loans backed by Federal Housing Administration insurance, as well as mortgages serviced by lenders that are participating in the government’s loan modification program.

Fannie Mae sent guidance to lenders on Wednesday saying that banks could offer unemployed borrowers up to six months of lowered or skipped payments without seeking Fannie’s prior approval, and that banks could extend that forbearance up to 12 months with approval. This guidance modified a policy from September 2010, when Fannie expanded its existing forbearance option for other hardships like natural disasters to include unemployment.

Wednesday’s announcement also said that unemployed homeowners who apply for an official forbearance after already missing some payments can skip only up to a maximum of 12 months. After that, if homeowners are still unemployed or unable to make payments, lenders and borrowers would have to consider other options, including a permanent loan modification or a short sale.

Freddie Mac announced last Friday that it would permit jobless borrowers to skip or reduce payments for up to 12 months as well. Previously, borrowers whose loans were owned by Freddie were eligible for up to only three months of suspended or reduced payments. In most cases, the homeowners must pay back the lower or skipped payments over a longer loan period.

“These expanded forbearance periods will provide families facing prolonged periods of unemployment with a greater measure of security by giving them more time to find new employment and resolve their delinquencies,” Tracy Mooney, a senior vice president at Freddie Mac, said.

The financial firms and banks do not report exactly how many jobless people have used the programs.

Under the new rules, lenders are required to consider a forbearance plan among a number of options to prevent foreclosure. Most of the government programs intended to forestall or prevent foreclosure have not lived up to expectations, and many homeowners have lost their homes. Last year, foreclosures were filed against about two million properties, down from 2.9 million in 2010, according to RealtyTrac, a real estate data provider.

Neither Fannie nor Freddie could specify how many borrowers might be eligible for the forbearance options, but it would be up to lenders to administer them.

Bank of America said it was “currently assessing operational aspects of implementing” the extensions. GMAC Mortgage said it was already participating in forbearance programs and would continue to follow Fannie and Freddie guidelines. Wells Fargo said it would review the details of Freddie and Fannie’s updated options.

Some analysts were skeptical of the programs’ effects. “It’s a humane and not at all unreasonable policy, but I wouldn’t expect it to do much to the housing problem,” said Joseph Gyourko, professor of real estate at the Wharton School at the University of Pennsylvania. “This will save some of them,” Professor Gyourko said. “But some of them shouldn’t be in the homes they are in and some of them won’t end up finding jobs that will enable them to pay for their mortgages, so there could be some downside because it could slow the foreclosure pipeline.”

And it is not clear that many borrowers who are eligible for delayed or suspended payments have been granted the option. Only 16,633 homeowners have been granted forbearances under the Treasury’s program for lenders who are participating in the government’s loan modification program. Only 3,000 homeowners whose loans are backed by F.H.A. insurance have been granted a forbearance since July.

Housing advocates said Fannie and Freddie’s options should help more struggling borrowers. Forbearance “is a real life saver,” said Lewis Finfer, a community organizer at the PICO National Network, a coalition of faith-based organizations. Jobless borrowers will have more time “to hopefully get more hours or get re-employed, and they can save their home during that period.”

Article source: http://feeds.nytimes.com/click.phdo?i=6e4fb9e147637b49f078036d9975f556

Jobless Claims Tumble to Lowest Level Since 2008

Far fewer people sought new unemployment benefits last week than just three months ago, the Labor Department said Thursday.

The number of people applying for benefits fell last week to 366,000, the fewest since May 2008. If the number stay that low consistently, it could signal that hiring is strong enough to lower unemployment, analysts say.

The unemployment rate in November was 8.6 percent. The last time jobless applications were this low, the rate was 5.4 percent.

Other economic indicators released Thursday were mixed. Wholesale prices rose a modest 0.3 percent last month, whileindustrial production fell 0.2 percent.

Economists said the decline in output at the nation’s factories, mines and utilities was not good news, but they also noted it followed steady gains over the previous six months.

The four-week average of unemployment applications, which smooths fluctuations, dropped last week to 387,750. That’s the lowest four-week average since July 2008. The four-week average has declined in 10 of the last 12 weeks.

“Labor market conditions have taken a turn for the better in recent weeks,” Michael Gapen, an economist at Barclays Capital, said in a note to clients. “Payroll growth should improve in the coming months.”

Applications for unemployment benefits are a measure of the pace of layoffs. Job cuts have fallen sharply since the recession, but employers have been hiring at only a modest pace. When applications fall below 375,000 consistently, that usually signals that hiring is strong enough to lower the unemployment rate.

The downward trend comes as Congress is wrangling over whether to extend emergency unemployment benefits, which are set to expire at the end of this year.

Other recent reports have suggested that the job market is improving a bit. In the past three months, net job gains have averaged 143,000 a month. That compares with an average of 84,000 in the previous three months.

In November, employers added 120,000 jobs, and the unemployment rate fell to 8.6 percent from 9 percent. That was the lowest unemployment rate in 2 and a half years. But about half that decline occurred because many of the unemployed gave up looking for work. When people stop looking for a job, they’re no longer counted as unemployed.

About 6.7 million people are receiving unemployment benefits. About 2 million will lose their benefits by mid-February if the emergency program expires.

Lawmakers differ over how long benefits should last. The House passed a Republican bill Tuesday that would renew emergency aid but reduce the maximum duration to 59 weeks from the current 99 weeks.

Democrats want to keep the full 99 weeks. The measure is part of broader legislation in the Democratic-led Senate that would also extend a Social Security tax cut.

The decline in manufacturing output reported by the Federal Reserve was the first in seven months and was largely because factories made fewer autos. But production of home electronics, appliances and business equipment also dropped.

Economists noted that more recent data from regional Fed banks suggests manufacturing grew sharply in both the Northeast and Philadelphia region in December.

“One month is not a trend,” said Dan Greenhaus, chief global strategist with BTIG.

Factory output, the biggest component of industrial production, decreased 0.4 percent, the Federal Reserve reported. The decline was mainly because of steep drop in the production of motor vehicles and parts. When stripping out auto production, which can be volatile from month to month, factory output fell just 0.2 percent.

Meanwhile, companies paid 0.3 percent more for such items as food and pharmaceuticals. But energy prices barely rose, keeping inflation in check.

In the 12 months ended in November, wholesale prices have increased 5.7 percent, down from a 5.9 percent year-over-year pace in October, the Labor Department said Thursday. It’s the smallest yearly increase since March. The department’s producer price index measures price changes before they reach consumers.

Excluding the volatile food and energy categories, the so-called “core” index rose 0.1 percent, after a flat reading the previous month. In the 12 months ending in November, the core index rose 2.9 percent, up a yearly pace of 2.8 percent in October.

Most economists say they think inflation has peaked and will slowly decline next year. That’s because prices for oil and many agricultural commodities have fallen from their highs this spring. Slower growth in China and a possible recession in Europe have reduced global demand for energy and other goods.

Producer price inflation “appears to have peaked and begun a slow retreat,” Steven Wood, an economist at Insight Economics, said in a note to clients.

Lower price growth means consumers will have more buying power, potentially raising consumer spending. The jump in gas and food prices earlier this year limited the ability of consumers to buy other goods, thereby slowing the economy.

 

Article source: http://feeds.nytimes.com/click.phdo?i=3266aa532a0b272691c41e1fc13a91b9

One Million Apps, and Counting

Apps shrink the programs that were once available only on a desktop computer to make them usable on smartphones and mobile devices — stock trades, restaurant reviews, Facebook, streaming radio, photographs, news articles, videos and, of course, Angry Birds.

The pace of new app development dwarfs the release of other kinds of media. “Every week about 100 movies get released worldwide, along with about 250 books,” said Anindya Datta, the founder and chairman of Mobilewalla, which helps users navigate the mobile app market. “That compares to the release of around 15,000 apps per week.”

According to Mobilewalla, in a fairly quiet 14 days before the release of app No. 1,000,000, an average of 543 apps were released each day for Android-based devices, and an average of 745 apps hit the market daily for the iPhone, iPad and iTouch. The total for the two weeks across the Apple, Android, BlackBerry and Windows platforms was 20,738.

A product was counted each time it was designed for a different device in the climb to a million apps. So when Urbanspoon was released for iPhone, BlackBerry, iPad and Android, it was counted four times because each platform demands different code from the developers.

By any measure, the rise in apps is striking. In October 2008 the known app universe was 8,000 Apple titles. Mobilewalla was formed that year to provide a Web site for users to search for mobile apps, and to categorize and rank them.

Mobilewalla began analyzing Android and Windows apps in 2009, and added BlackBerry a year later. The 100,000-app milestone was passed in December 2009. In little more than a year, the total passed 500,000 and exceeded 750,000 six months after that. Five months later: one million.

For Dr. Datta, the surge in apps and the ability of almost anyone to bring an app to market is a chicken-and-egg story. Developers who have created fewer than 10 apps make up 80 percent of the producers, he said. “Anyone with a good idea can outsource the code, and they own a new app.” In January, Mobilewalla will begin tracking ranking, downloads and revenue for individual apps

Brad Hunstable, a co-founder and the chief executive of Ustream, an app that allows users to broadcast live video to the Internet using a smartphone, or watch video anywhere, explained how the world has changed. Building an app for a phone five years ago meant going through the carrier, and contending with hardware and quality assurance issues, he said. “Now anyone can build for a platform,” he said.

Adding to prime conditions for app development is what Mr. Hunstable called the “convergence of the app ecosystem,” a world with more powerful devices, higher quality networks and high-resolution cameras.

“It’s an exciting time to be a developer for mobile,” said Thomas Chung, a vice president and general manager of the Playforge, a developer based in San Mateo, Calif. The Playforge released Zombie Farm, a role-playing game, in February 2010 for Apple, and an Android version in October 2011. On Friday, it was the top game in its category on Mobilewalla.com. Lower barriers to entry have prompted an explosion of content in the last few years, he said.

“The market has become more consumer-facing, too,” he said. “A lot of people can download applications now, and it’s just a big win all around.”

Article source: http://feeds.nytimes.com/click.phdo?i=b9652dee1e151a75d8dc5859da2cd559

Off the Charts: Signs That the Era of Cheap Chinese Imports Is Ending

Beginning in the 1990s, the emergence of China as a major exporter first depressed and then held down the prices of many goods, helping to improve living standards in the United States. But recently, prices have begun to rise.

The change can be seen clearly in the accompanying charts showing the Consumer Price Index for apparel. Because prices can be volatile, they use three-month moving averages to smooth the trends.

The chart above shows how prices have moved over the last two decades, from the end of 1991 through the September figures released this week. Prices are still well below where they were in 1991, a performance that no one would have expected at the time. Over the previous two decades, beginning in 1971, that index doubled.

But in the last few months, the index has begun to rise at the fastest rate in many years. This spring, prices were still about 9 percent lower than in late 1991. Now the prices are just 5 percent below the level of two decades ago.

A second chart shows the 12-month change in the index. It is now up to 3.6 percent, the highest since 1992. Over the last six months, the three-month average has risen at an annual rate of 7.6 percent.

Prices for apparel were broadly steady for most of the 1990s, before beginning a sharp descent in 1998 that continued until 2003. Much of the decline was because of imports from China, which forced down prices and allowed Chinese suppliers to supplant companies from many other countries. The declines continued at a slower pace for several more years, but prices now appear to have hit bottom in 2007.

When Chinese trade was helping to push down prices for many things, the reported low figures for inflation gave optimistic central bankers a reason to think that there was no need to slow rapid growth in the United States.

The continued monetary stimulus helped push unemployment rates down to the levels of the late 1950s. The underlying assumption was that technological innovations had produced a new economy that could boom without inflation.

The alternative explanation was that a substantial part of the reported low inflation came from imports of Asian, primarily Chinese, products, and that that effect was bound to be temporary. At some point, trade imbalances would become unsustainable and the inflation picture would reverse, as either the dollar lost value or costs began to rise in Asia.

That is what appears to have happened. Labor costs are rising in China. Some business is going to other countries, where wage rates are lower than in China. And some product prices are rising.

The excessively easy monetary policy helped lead to bubbles in the American economy, first in technology stocks and then, much more damaging, in housing. There was substantial inflation, even when import prices were falling, but it was in other parts of the economy.

The third chart shows the United States balance of payments — largely determined by the trade surplus or deficit — as a percentage of the country’s gross domestic product. From a rough balance two decades ago, it deteriorated to a deficit of more than 6 percent of G.D.P. in 2006, before the economy began to stumble.

If the era of Chinese-led deflation has ended, the implications may be unfortunate for consumers, as the price of necessities rises even as the American economy continues to struggle along in a slow recovery from the recession of 2007 to 2009.

Floyd Norris comments on finance and the economy at nytimes.com/economix.

Article source: http://www.nytimes.com/2011/10/22/business/signs-that-the-era-of-cheap-chinese-imports-is-ending.html?partner=rss&emc=rss