National News

Twitter is relying on the Underwear Gnomes Profit Plan

Marketplace - American Public Media - Wed, 2014-07-30 13:45

Twitter released its quarterly results and they were impressive — shares jumped nearly 20 percent today.

The social media giant says they have picked up 16 million users in the last few months, making a grand total of 267 million users on Twitter. On top of that, revenue more than doubled thanks to new types of mobile ads.

Of course, revenue and profit aren’t quite the same thing. Twitter is still losing money.

That might sound surprising, but it’s actually pretty typical for tech companies, which tend to have a business plan that strongly resembles the business model of the Underpants Gnomes from South Park.

South Park Underwear Gnomes Profit Plan (full) from Jane Lu on Vimeo.

"It’s actually a very good business model," says Erich Joachimsthaler, CEO of Vivaldi Partners.

OK, he’s actually not talking about the underpants gnomes, he’s talking about Twitter and other tech companies, which tend to follow a plan that looks something like this:

PHASE 1: Attract millions of users with free services.

PHASE 2: Figure out some way to exploit those users.

PHASE 3: Make millions of dollars.

We’ve seen this work time and again, says Joachimsthaler - think Google and Facebook.

"As habit forms and as millions of people become hooked, Twitter has an opportunity to add advertising [and] some e-commerce functions, basically monetizing the asset," Joachimsthaler says.

But that could be tricky for Twitter. Advertisers love Facebook because it knows so much about its users and there are so many of them, says Ken Wilbur, assistant professor of marketing at UC San Diego's Rady School of Management.

He says they don’t love Twitter quite as much.

"When you put ads into the Twitter feed itself, it lowers the utility of Twitter to its users," Wilbur says. "And they don’t have a great platform for putting ads next to the feed."

Wilbur says it remains to be seen whether Twitter can find a way to fully monetize its users. It could either be the next Facebook or the next Friendster. At one time, Friendster was the biggest social network on the web, with more than 100 million users and now it’s a gaming site based in Malaysia.

Ah, the pitfalls of phase two.

Moldova's Winemakers Seize Upon Region's Geopolitical Moment

NPR News - Wed, 2014-07-30 13:44

The tiny European country of Moldova isn't known for much of anything, and especially not its wine. But its winemakers are trying to find new export markets and overcome their post-Soviet reputation.

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Women, divorce, and long-term finances

Marketplace - American Public Media - Wed, 2014-07-30 13:28

At a divorce workshop called Second Saturday, women of all ages are packed around a large conference table. One of them is Jenny Juffs. She’s divorcing after 19 years of marriage and has two special needs children. Like many women, Juffs is pretty shocked by her new financial reality.

“I’ve been a wife or homemaker all my life," she says. "Everything’s changing for me. I’ve never managed money.”

This situation is particularly grim for older women. Today, a quarter of divorced women over 60 live in poverty. Overall, older women see their household income drop by 41 percent. That’s twice the amount of their ex-husbands. And, to make matters worse, baby boomers are splitting up at record rates.  

"So we are seeing these 20, 25, 30, 35-year marriages coming apart, with the women who have never worked outside of the home," says financial advisor Grace Antares. 

Antares heads Portland’s local chapter of Second Saturday. Many people who come to her divorce seminar are completely inexperienced when it comes financial planning. She often sees panic. Like one middle-aged woman who fled the room: “She explained to one of my colleagues that she was going through what felt like PTSD to her, that she had been separated from her husband for 10 years and had made every single mistake that we had mentioned in the first part of the class.”

So, financial literacy is important. But Antares says the biggest contributor to post-divorce success is earning power - and some women who spent more of their time focusing on the family lack job skills. 

As for Jenny Juffs, she's trying to build basic skills, like keyboarding. "I know how to use a computer a little bit, but not Office or Excel or anything that anybody’s going to need.”

Antares says even women who have good jobs can make poor financial decisions after divorce. And the closer to retirement these mistakes are made, the more devastating the effect. Grace Antares is now 64-years-old, and has her own story.

"I was highly emotionally attached to the house," she says. "I pulled out the equity to pay him, I was the bigger earner, paid him a big settlement. Then, when the real estate market crashed, the house was underwater instantly. And so he got all the tax-free cash, and I got a foreclosure and a bankruptcy.”

Antares' own experience is what helps fuel the one message she repeats all the time: “You’re going to be in charge of your finances for the rest of your life."

Gaza's Network Of Tunnels Is A Major Hole In Israel's Defenses

NPR News - Wed, 2014-07-30 13:14

Hamas militants are using tunnels in and out of Gaza to strike inside Israel. Israelis are questioning how the tunnels grew to be so complex and why the military hasn't been able to shut them down.

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Grocery Chain Workers Want Their CEO Back

NPR News - Wed, 2014-07-30 13:04

Arthur T. Demoulas, chief executive of the New England grocery chain Market Basket, was pushed out by his cousin in a boardroom struggle. Protesting employees have brought business to a standstill.

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Judge Orders Bank Of America To Pay $1.3 Billion Fine

NPR News - Wed, 2014-07-30 12:27

A jury had found the bank liable for fraud related to mortgages sold by its Countrywide Financial unit last October. Bank of America may appeal.

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Violence On The Ground Hobbles MH17 Investigations

NPR News - Wed, 2014-07-30 12:00

Nearly two weeks since a Malaysia Airlines flight was downed over eastern Ukraine, fighting in the region continues to delay the start of an investigation. For more, Audie Cornish speaks with Paul Sonne, the Moscow correspondent for the Wall Street Journal.

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For 2 Senators, Campus Sexual Assault Solution Starts In Washington

NPR News - Wed, 2014-07-30 12:00

To learn more about the new legislation aimed at sexual assault on campuses, Audie Cornish speaks with two of the bill's co-sponsors, Sen. Claire McCaskill and Sen. Kirsten Gillibrand.

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Senators Roll Out A Bill To Curb Sexual Assault On Campus

NPR News - Wed, 2014-07-30 12:00

A bipartisan group of senators has introduced new legislation aimed at combating sexual assault on American college campuses. If passed, the bill would force colleges to handle accusations more aggressively and provide advocates for victims.

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As Wildfires Burns Through Funds, Washington Seeks New Way To Pay

NPR News - Wed, 2014-07-30 12:00

Wildfires are ravaging thousands of square miles on the West Coast, though officials say that this wildfire season has been tamer than average. Still, responding to these fires has proven costly, and the Obama administration is reevaluating how it pays for fighting them.

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A Market And A School Come Under Fire During A Violent Day In Gaza

NPR News - Wed, 2014-07-30 12:00

An explosion rocked a crowded Gaza market during what was expected to be a lull in the fighting. Earlier in the day a United Nations school was hit by what U.N. officials say was Israeli artillery fire, killing at least 15 people. Meanwhile, rocket fire from Gaza continues to be fired into Israel.

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Senate Bill Would Fine Colleges For Mismanaging Campus Rape Cases

NPR News - Wed, 2014-07-30 12:00

A group of senators has introduced legislation aimed at combating sexual assault on college campuses. It would force schools to handle accusations more aggressively and provide advocates for victims.

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Senate Bill Would Fine Colleges For Mismanaging Campus Rape Cases

NPR News - Wed, 2014-07-30 12:00

A group of senators has introduced legislation aimed at combating sexual assault on college campuses. It would force schools to handle accusations more aggressively and provide advocates for victims.

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Lawsuit Opens A Long Round Of Political Pingpong

NPR News - Wed, 2014-07-30 12:00

Republicans in the House voted to allow Speaker John Boehner to sue President Obama. They believe the president has overstepped his constitutional authority.

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Lawsuit Opens A Long Round Of Political Pingpong

NPR News - Wed, 2014-07-30 12:00

Republicans in the House are holding a floor vote to allow Speaker Boehner to sue President Obama. They believe he's overstepped his constitutional authority; specifically, the resolution would authorize a federal lawsuit for Obama's handling of the Affordable Care Act.

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Late Rally From Argentina Fails To Delay Default

NPR News - Wed, 2014-07-30 12:00

Earlier in the day it looked like a resolution was possible, but ultimately talks between the country and a group of creditors broke down in New York. The first time the country defaulted was in 2002.

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Fast Growth Does Little To Budge Fed's Caution — For Now

NPR News - Wed, 2014-07-30 12:00

Federal Reserve policymakers are announcing that the Fed plans to leave short-term interest rates at a level near zero. This, despite an economy that grew at a surprisingly strong 4 percent annual rate in the most recent quarter.

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Time for 'You've got mail' to get on OKCupid?

Marketplace - American Public Media - Wed, 2014-07-30 11:37

These days, box office hits include explosions, aliens and robots - characters most romantic comedies do not contain.

Megan Garber, staff writer for The Atlantic, says the romantic comedy has been dying a slow death, as studios fail to recognize the evolution of romance itself. Rom-coms are not portraying the reality of dating for people in the digital age.

"The world of Tinder, eHarmony and Match.com is not really well reflected in Hollywood at this point," says Garber. "Right now, there isn’t much on the screen that would sort of tell us how to behave in this crazy world of online dating."

Listen to the full conversation in the audio player above.

Foxconn's newest product: a college degree

Marketplace - American Public Media - Wed, 2014-07-30 11:36

There are a lot of lines at a typical Foxconn factory in China. There’s the assembly line, where thousands of young people – typically high school dropouts – put together each and every part of an iPad. It’s tedious, mind-numbing work, and that’s why assembly line workers usually don’t stick around very long. They quit, and that necessitates another line: The hiring line outside a Foxconn factory is, at any given time, hundreds of applicants long, migrants from the countryside who arrive each day to replace workers who’ve quit. When you consider the manufacturer has a million workers – it’s China’s largest private employer – this labor cycle isn’t surprising.

But it is costly.

“The turnover rate is pretty high and it’s impossible to retain all our workers," says Li Yong Zhong, a manager at Foxconn's Chengdu plant, "But we’d like every employee to be able to develop and improve their knowledge, skills and income so that they’ll want to stay here.”

That’s the rationale behind what the company calls Foxconn University, a company-wide accredited university system that offers employees a chance at earning a high school diploma, a bachelor’s, a master’s or a PhD without leaving the factory campus.

Inside the classroom one afternoon, a professor teaches a computer animation class to students at Foxconn’s plant in Chengdu, a factory devoted to making iPads. Instead of assembling Apple products, each one of these workers is using an Apple computer to follow the professor’s instructions. Thirty-six year-old Ai Guo, an assembly line worker who spends his days inspecting iPads for flaws, sits in front of the class.

“I dropped out of school when I was 16," says Ai during a class break. "My family was very poor, and they needed me to help out on the farm.”

It's a typical story for the hundreds of millions of young rural Chinese who drop out of school to farm or find work at factories like Foxconn. Ai hopes to spend the next six years of his time away from work studying toward the equivalent of a high school diploma and then a bacehlor’s degree in Industrial Engineering. “With that, I’d like to get a promotion to start working on industrial automation and, of course, raise my salary," he says.

Foxconn’s university system offers 25 majors – most of them in engineering. The company has an agreement with more than 50 Chinese universities and colleges that send their professors each day to teach classes at its factories across China.

But it's not only Foxconn – in-house university systems are becoming a trend among China’s state-owned companies, says Richard Brubaker, founder of Collective Responsibility, an organization that trains companies in corporate social responsibility. Brubaker says he’s encouraged by Foxconn University – he says it shows the company sees its line workers as more than machines with 5-year shelf lives. “Many of these individuals could, if they were invested into, come into the organization at a much higher level, and much like a UPS driver becomes a CEO, they could become the future management and executives of the company and who know the company so intimately that they’re the ones who can look at risk, look at decisions very differently than an outsider could,” Brubaker says.

The development of an in-house university system comes at a pivotal moment for Foxconn. CEO Terry Gou is 63, and he’s thinking about his legacy. He’s moving the company away from making products for others and toward developing Foxconn’s own products.

“We want our employees to become more innovative and creative, more entrepreneurial,” says Foxconn’s Li Yong Zhong.

But so far, participation in Foxconn University is low: just 3 percent of Foxconn’s one million Chinese workers. Li assures me that will change. "Someday, every one of our employees will study at Foxconn University – we’ll no longer call them workers," he says. "We’ll call them students."

Foxconn's newest product: a college degree

Marketplace - American Public Media - Wed, 2014-07-30 11:36

There are a lot of lines at a typical Foxconn factory in China. There’s the assembly line, where thousands of young people – typically high school dropouts – put together each and every part of an iPad. It’s tedious, mind-numbing work, and that’s why assembly line workers usually don’t stick around very long. They quit, and that necessitates another line: The hiring line outside a Foxconn factory is, at any given time, hundreds of applicants long, migrants from the countryside who arrive each day to replace workers who’ve quit. When you consider the manufacturer has a million workers – it’s China’s largest private employer – this labor cycle isn’t surprising.

But it is costly.

“The turnover rate is pretty high and it’s impossible to retain all our workers," says Li Yong Zhong, a manager at Foxconn's Chengdu plant, "But we’d like every employee to be able to develop and improve their knowledge, skills and income so that they’ll want to stay here.”

That’s the rationale behind what the company calls Foxconn University, a company-wide accredited university system that offers employees a chance at earning a high school diploma, a bachelor’s, a master’s or a PhD without leaving the factory campus.

Inside the classroom one afternoon, a professor teaches a computer animation class to students at Foxconn’s plant in Chengdu, a factory devoted to making iPads. Instead of assembling Apple products, each one of these workers is using an Apple computer to follow the professor’s instructions. Thirty-six year-old Ai Guo, an assembly line worker who spends his days inspecting iPads for flaws, sits in front of the class.

“I dropped out of school when I was 16," says Ai during a class break. "My family was very poor, and they needed me to help out on the farm.”

It's a typical story for the hundreds of millions of young rural Chinese who drop out of school to farm or find work at factories like Foxconn. Ai hopes to spend the next six years of his time away from work studying toward the equivalent of a high school diploma and then a bacehlor’s degree in Industrial Engineering. “With that, I’d like to get a promotion to start working on industrial automation and, of course, raise my salary," he says.

Foxconn’s university system offers 25 majors – most of them in engineering. The company has an agreement with more than 50 Chinese universities and colleges that send their professors each day to teach classes at its factories across China.

But it's not only Foxconn – in-house university systems are becoming a trend among China’s state-owned companies, says Richard Brubaker, founder of Collective Responsibility, an organization that trains companies in corporate social responsibility. Brubaker says he’s encouraged by Foxconn University – he says it shows the company sees its line workers as more than machines with 5-year shelf lives. “Many of these individuals could, if they were invested into, come into the organization at a much higher level, and much like a UPS driver becomes a CEO, they could become the future management and executives of the company and who know the company so intimately that they’re the ones who can look at risk, look at decisions very differently than an outsider could,” Brubaker says.

The development of an in-house university system comes at a pivotal moment for Foxconn. CEO Terry Gou is 63, and he’s thinking about his legacy. He’s moving the company away from making products for others and toward developing Foxconn’s own products.

“We want our employees to become more innovative and creative, more entrepreneurial,” says Foxconn’s Li Yong Zhong.

But so far, participation in Foxconn University is low: just 3 percent of Foxconn’s one million Chinese workers. Li assures me that will change. "Someday, every one of our employees will study at Foxconn University – we’ll no longer call them workers," he says. "We’ll call them students."

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