14.3.2012businesslifestyle

Diamonds in the Rough

Looking at the tumultuous, profitable world of diamonds. A worldwide cartel controls supply and demand while labs try to mass-produce diamonds, squabbling between shareholders guts a successful jewelers, and the heist of the century that remains unsolved.

2.3.2012businesstechnology

Who’s Watching You?

"The best minds of my generation are thinking about how to make people click ads"

Jeff Hammerbacher

Brick and mortar retailers like Target have been tracking you for years, rapidly improving their statistical methods to make educated guesses about how to advertise at you more effectively, but as the internet becomes more and more ubiquitous the practice is moving online and getting bigger than ever.

Almost all of your favourite companies are gathering data on your surfing habits in a massive interconnected web of ad trackers. The primary goal is to serve more effective advertising, but these companies now hold enough data on you to bring privacy concerns to the fore. A Wall Street Journal investigation a year and a half ago found a burgeoning industry with millions of dollars flowing through it holding detailed records on you, making increasingly precise predictions about your behaviour, and a recent investigation by Alexis Madrigal in The Atlantic takes a philosophical look at your anonymity among the machines.

2.3.2012business

America’s Warehouses

What happens when you buy something online? Your order finds its way to a worker in a warehouse on a 7:30am to 5pm shift who finds the item somewhere in a cavernous warehouse and scans it. Thousands of times a day. They risk termination if they don’t meet impossible targets, if they take a day off for a doctor visit, even if they injure themselves. They have almost no worker’s rights or benefits. And they make about $11 an hour.

The warehouses are owned by third party logistics companies, and they staff the warehouses using temping agencies that supply thousands of warehouse workers. Sometimes they’re supplying so many that they even have offices right there in the warehouse. By operating this way, big name retailers like Amazon and Walmart distance themselves from the conditions in the warehouses. They’re rarely named in the frequent lawsuits, and they can easily shift responsibility.

23.1.2012technologybusiness

The Demise of American Manufacturing

The Atlantic has a great article in this month’s issue on the demise of the manufacturing industry in the U.S. Although America’s manufacturing output has risen by a third in the last decade (when adjusted for inflation), the decade prior to that saw employment in manufacturing collapse to levels not seen since the Depression. The article takes a close look at how some manufacturers have managed to survive in such dire circumstances and what might be done to reverse the trend.

The main problem is that Americans are rapidly shifting their manufacturing into Asia, as the New York Times reported this weekend, using Apple as a case study. Most of Apple’s products were built in the U.S. until as recently as 2002, but in 2004 they became one of the last American companies to move their manufacturing into Asia and Europe. Part of the problem was that the labor over there was so much cheaper when compared to the cost of buying parts and managing supply chains from hundreds of foreign — mostly Asian — companies.

The other side of the problem is that there aren’t enough workers with the necessary skills in the U.S., according to the NYT’s sources. Apple’s iPhones are assembled at Foxconn in China, where 40% of the world’s electronics are assembled. Overseeing the 200,000 assembly line workers putting iPhones together requires 8,700 engineers; Apple’s analysts guessed it would take 9 months to find that many workers in the U.S., whereas it took only 15 days in China.

The other advantage of outsourcing production to China became clear last year when a string of 17 Foxconn employees committed suicide. Chinese workers, by and large, appear willing to put up with much worse working conditions than Americans are accustomed to. Most of their employees work 6 days a week for less than $17 a day, they sleep in company barracks, and as of last year’s events, are required to sign contracts forbidding them from committing suicide.

Further Reading

13.1.2012business

Truth Vigilantism

Arthur Brisbane asked yesterday if the New York Times should be what he referred to as a “truth vigilante.” He wrote: “I’m looking for reader input on whether and when New York Times news reporters should challenge ‘facts’ that are asserted by newsmakers they write about.” Should the NYT be calling bullshit, in other words. Well, yes, obviously, but Brisbane says he was misunderstood. What he was talking about, seemingly unaware that this is well-covered ground, is the View from Nowhere. Jay Rosen has a fuller roundup of reactions and opinions on his blog PressThink.

7.1.2012business

Newspapers, Paywalls, and Core Users. “This may be the year where newspapers finally drop the idea of treating all news as a product, and all readers as customers.” Clay Shirky talks about newspaper business models in 2012.