You know Wall Street executive pay is too high when…

Jennifer McClelland | RSS | Thu, Nov 12 2009 | 0 Comments

There are plenty of people across the country as well as around the world who have something to say about the United States economy and Wall Street. The two have been skipping down the recession highway hand-in-hand for the past year and everyone sees it.

Executive pay is one of the things that gets a lot of people particularly fired up and you really know that the executives are making too much money when Bill Gates says they are.

Gates had this to say, “It was a bad milestone in controlling executive salaries when that $1 million cap went on. The compensation problem is a very interesting problem. I do think compensation is often too high, but it’s a very tough problem to solve.”

The cap he is talking about is a $1 million cap in executive pay that went into effect in 1993. Since the cap was put in place, companies have found other ways of showering their executives with gifts and other things such as lucrative stock options. The stock options were often worth FAR more than a year’s salary at one of the companies would have been.

The $1 million limit on salaries encouraged companies to instead give executives lucrative stock options, sending pay to vast new heights.

Gates also worries about the government’s control of AIG, “I do worry that when the government owns an entity like AIG that you can greatly devalue that entity by having it essentially have to behave as though it is part of the government. It is an unnatural situation when the government owns a lot of a private company. Unfortunately there is a view that it should exist for a long term. There is some devaluation of what that asset would have been worth if it hadn’t had to go through that kind of management structure. It is unavoidable.”

Bill Gates is one of the people who benefit from lucrative stock options with his company (which he stepped down from to focus on philanthropy). However, I do not see Microsoft taking down the entire United States economy like the banking industry did.

Source

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Tags: lucrative stock options, banking industry, microsoft

Microsoft wants to put stores “next to Apple” ones.

Jennifer McClelland | RSS | Thu, Jul 16 2009 | 0 Comments

There is a heated rivalry between Apple and Microsoft that has been increasing in the past 8 years or so. Well, ever since the release of the iPod and Apple’s subsequent increase in market share since then. For awhile it was just a friendly rivalry between the two, but then Apple decided that its market share wasn’t growing fast enough and it decided to start hitting Microsoft where it hurt and begin poking fun of PCs with those “I’m a Mac, and I’m a PC” commercials.

While it took them a few months, Microsoft answered in a way that kind of hit Apple in one of its only weak spots, price. Now Microsoft is constantly running the commercials about someone walking into (usually a Best Buy) store, to buy a laptop only to discover their price range doesn’t include Apple products.

Reportedly, Apple wasn’t happy with those commercials and dropped the price on some of its products then asked Microsoft to stop showing them. Well, needless to say, Microsoft is still showing the commercials regardless of a $100-$200 price drop from Apple.

Now, Microsoft really wants to try to show Apple that it’s boss. Microsoft chief operating officer, Kevin Turner, said that the company is planning to open retail stores “right next door to Apple” starting in the fall. He also said that Microsoft is in the game for “the long term” and that it has hired a retail team.  It has hired a 25 year Wal Mart veteran to begin the process, but really hasn’t said anything until now since February about the venture.

Apple only owns 250 stores worldwide, so it shouldn’t be hard for Microsoft to infiltrate those markets. From my own observations, it shouldn’t be hard right now for Microsoft to buy buildings and space next to the Apple stores because so many retailers have been going out of business, there are plenty of empty retail spaces…even next to Apple stores.

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Tags: retail spaces, apple products, going out of business

Microsoft new ad targets Apple’s high prices

Jennifer McClelland | RSS | Fri, Mar 27 2009 | 0 Comments

I’ve always wondered when someone would notice how expensive Apple’s computers are. I mean for $1000 you can get the lowest end MacBook available, at 13″ and underpowered, it is really expensive to look cool.

Apple is an image and Microsoft wants to show people that it can also be an image, an image that says I have a great computer and didn’t have to pay a fortune for it.

In the commercial from advertising agency Crispin Porter + Bogusky, Lauren goes into an Apple store, quickly walks back out and reports, “For $1,000 they only have one computer available, and that’s a 13-inch screen. I would have to double my budget, which isn’t feasible. I’m just not cool enough to be a Mac person.” That statement is a direct hit against Microsoft’s longtime rival that implies you don’t get much computer for your money when you buy a Mac.

Last week, Microsoft CEO Steve Ballmer set the stage for the new ad’s debut when he said, “Apple gained about one point, but now I think the tide has really turned back the other direction. The economy is helpful. Paying an extra $500 for a computer in this environment — same piece of hardware — paying $500 more to get a logo on it? I think that’s a more challenging proposition for the average person than it used to be.”

Lauren was excited when she entered a retail store with a variety of PCs. She tries out a few keyboards and looks at the specs on a few others. Finally, the look of one PC draws her. She settles on a Hewlett-Packard model that meets all her qualifications — for under $1,000. The commercial ends with Lauren telling the camera, “I am a PC and I got just what I wanted.”

Everytime I see an Apple product I feel like I want it and I think that’s part of their marketing scheme. It’s “cool” to have a Mac or an I*something*. Other than their computers, look at their MP3 players, an iPod is $300. You can get a video player by Sony for much less…hmm.

Source

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Tags: Crispin Porter, proposition, economy