National News

What, exactly, Alibaba does

Marketplace - American Public Media - Mon, 2014-09-08 13:51

The Chinese e-commerce company Alibaba aims to hit a Wall Street milestone later this month: biggest IPO ever. Today, the company started what Wall Street calls a "road show" — nonstop meetings with potential investors, in an attempt to raise more than $24 billion. Analysts say the company’s likely to raise at least that much.

But all of the hype leaves open a basic question: What is Alibaba? Is this just a version of Amazon from China?  

No. Alibaba’s not a retailer. One of its biggest branches is a virtual shopping mall called Tmall, where consumers buy stuff from retailers and directly from commercial brands. Alibaba makes its money there much the way Google and Facebook do: by charging businesses for access to consumer eyeballs.

Jeff Papp, an analyst with Oberweis Asset Management, gives an example: “I go to Tmall, and I’m interested in buying bananas, and there’s 100 vendors of bananas,” he says. “So, [if] you’re a vendor of bananas and I am, too... I may pay more for my product to be listed first.”

Alibaba has two other major arms, one of them an eBay-like site called Taobao. The other, the company’s original site, Alibaba.com, does something that barely exists here: helping businesses find suppliers.

Charlene Li, founder of the tech consultancy Altimeter Group, says she once used Alibaba.com to research laptop manufacturing. “The fact that I could put out a bid, and talk to complete strangers in parts of China... that I had no idea where these people were,” says Li. “You think about: ‘I could actually do this at scale.’”

Alibaba has lots of other, smaller business lines — and recently it has made investments in U.S.companies like ShopRunner.com and the ride-share startup Lyft. The scale of those investments is small for a company that pegs its own value above $150 billion.

“I think what they’re trying to do with some of these investments is to better understand the U.S. markets,” says R.J. Hottovy, a tech analyst for Morningstar, “and the differences between its home market... China... and the U.S.”

In other words, this is R&D spending, not an attempt to take on Amazon directly.

What you could buy (on Alibaba) for $155 billion

As the massive Alibaba IPO approaches later this month, we've been trying to wrap our heads around the $155 billion valuation for the Chinese e-commerce company. As it happens, Alibaba lists a number of unique items on its online marketplace that could help put things in perspective. Here's a list of some interesting items you could buy on Alibaba, and how many of them you could get with $155 billion.

15 million silicone life-size Paul Walker statues

 

Image courtesy of Alibaba.

Are you still mourning the untimely loss of your favorite movie star? Maybe you could take the edge off by purchasing a silicone model of his exact likeness. You could buy not just one, but enough to populate a small country. If you want to mix things up, you could even throw in some wax models of other celebrities like Pierce Brosnan, Michael Jackson, or even the pope.

375 million pairs of breast implants

 

Image courtesy of Alibaba.

Alibaba apparently sells all sorts of medical equipment, even down to supplies for specific implants. For the old standby of cosmetic surgery, you are required to make a minimum order of 100 pairs, so you can't exactly get them on the cheap, but the breast implants probably wouldn't be much use without a surgeon anyway. With $155 billion, you could buy enough to stock the world's largest plastic surgery practice.

5 million worm-shaped amusement park trains

 

Image courtesy of Alibaba.

Planning to open the world's creepiest amusement park chain, but can't decide on what rides will best frighten children? Look no further than the "Popular! big worm amusement park electric train." With $155 billion, you could afford to buy a 300,000-kilometer track for your worm-themed attraction.

3.3 billion packs of human hair

 

Image courtesy of Alibaba.

We've reported before on how you can sell your own hair for a decent amount of money, and it seems Alibaba is the place to go to see the other side of that transaction. You can even pick out varieties like Brazilian, Peruvian or Malaysian for your wigs or extensions.

7.1 billion cases of whiskey

 

Image courtesy of Alibaba.

With $155 billion, that bar you've always thought about opening could be stocked well enough to serve a glass of whiskey to everyone on the planet for at least of couple of weeks, all thanks to Alibaba's surprisingly large selection of wholesale alcohol.

56.6 billion kilograms of spandex

Image courtesy of Alibaba.

Need more material for spare "Star Trek" uniforms for you and your friends after the old ones got a bit ripe at the last convention? Alibaba has got you covered, and with $155 billion, you could probably even manage to outfit Starfleet for real.

What $500 million buys for the Syrian opposition

Marketplace - American Public Media - Mon, 2014-09-08 13:51

President Barack Obama is renewing his call for Congress to authorize another $500 million for pro-Western rebels in Syria. There is growing pressure on the president to combat ISIS, also known as the extremist terrorist group Islamic State, and to help topple the regime of Syrian president Bashar al-Assad.

But what does $500 million buy in this scenario?

When the president first proposed the aid back in June, the money was expected to train and arm 2,300–2,500 Syrian rebels. That’s less aid than Assad's opposition wants.

“You’re talking about everything from Kalashnikovs to rocket launchers and grenade launchers,” says Andrew Tabler, a Syrian expert at the Washington Institute for Near East Policy. “The real question is does that include anything close to an anti-aircraft weapon?”

The administration is worried about funding those kinds of weapons because they can easily fall into the wrong hands. A new report indicates that anti-tank weapons once owned by Syrian rebels are now in the hands of Islamic State militants.

Haim Malka, deputy director of the Middle East program at the Center for Strategic and International Studies, says the problem is figuring out exactly which groups to give money to.

“Many of them may share U.S. objectives of fighting the Islamic State or fighting the Assad regime today, but we’re not sure exactly what their agenda is going to be tomorrow.”

Tabler of the Washington Institute for Near East Policy predicts the U.S. will get more deeply involved in the Syrian conflict.

“We were naïve to think we could get out of it,” says Tabler. “What happens in the Middle East doesn’t stay in the Middle East.”

Iraqi Parliament Approves New Government Led By Abadi

NPR News - Mon, 2014-09-08 13:28

After months of uncertainty and political wrangling, Iraq finally has a new government, led by Shiite Haider al-Abadi. He replaces Nouri al-Maliki.

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Could Great Lakes Fisheries Be Revived Through Fish Farms?

NPR News - Mon, 2014-09-08 13:15

This summer, Michigan's aquaculture industry took a step forward. And that has touched off a debate over whether the Great Lakes are an appropriate place for fish farming.

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Your Wallet: The cost of elder care

Marketplace - American Public Media - Mon, 2014-09-08 13:14

The cost of elder care continues to rise, along with the number of people who need it.

Are you taking care of an older relative? Or planning to?

Tell us on Twitter @MarketplaceWknd or email us, we'd love to hear your story.

Researcher Urges Wider Genetic Screening For Breast Cancer

NPR News - Mon, 2014-09-08 12:24

Genetic tests are recommended for women with a family history of breast cancer. One researcher says all women should be screened, but others say there's not enough evidence that they are at risk.

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CDC Warns Of Fast-Spreading Enterovirus Afflicting Children

NPR News - Mon, 2014-09-08 12:02

A spike in severe respiratory infections in children has the Centers for Disease Control and Prevention asking doctors and patients to act quickly if children have difficulty breathing and wheezing.

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New Option For Getting Rid Of Old Drugs: The Pharmacy

NPR News - Mon, 2014-09-08 11:52

The Drug Enforcement Administration is loosening up its rules so that people will have more ways of disposing of drugs that can be risky to keep around after they're no longer needed.

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Hawks Seek Buyer After NBA Team's Owner Reveals Racially Charged Email

NPR News - Mon, 2014-09-08 11:36

Controlling owner Bruce Levenson said he had voluntarily told the league about the 2012 email. In it, Levenson asked if the Atlanta Hawks' black fans were keeping white season-ticket holders away.

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It's not you, it's my cost-benefit calculations

Marketplace - American Public Media - Mon, 2014-09-08 11:24

Companies have lots of ways of optimizing for the best results. Big data, customer satisfaction and good old cost-benefit analysis are, of course, the buzz words of the moment

As writer Josh Freedman made clear in a story at McSweeney's Internet Tendency, they are popping up everywhere

Susan, we need to talk. I’ve been doing a lot of thinking lately. About us. I really like you, but ever since we met in that econ class in college I knew there was something missing from how I felt: quantitative reasoning. We can say we love each other all we want, but I just can’t trust it without the data. And after performing an in-depth cost-benefit analysis of our relationship, I just don’t think this is working out.

Listen to his piece adapted for the radio in the player above. 

 

Susan, we need to talk. I’ve been doing a lot of thinking lately. About us. I really like you, but ever since we met in that econ class in college I knew there was something missing from how I felt: quantitative reasoning. We can say we love each other all we want, but I just can’t trust it without the data. And after performing an in-depth cost-benefit analysis of our relationship, I just don’t think this is working out.

Please know that this decision was not rash. I just made a series of quantitative calculations. The calculations are fairly simple. Sex with you grants me seventeen utils of pleasure, but I derive negative utils from all of the cuddling afterwards.

Meanwhile, I could be doing plenty of other things. I could be drinking at the Irishman with a bunch of friends from work. I derive between 20 and 28 utils from hitting on girls at the bar. However, most of those girls don’t laugh at my jokes, which drives down utils gained. 

I know this breakup might come as a bit of a shock to you. I have included in my calculations the fact that as a courtesy I will have to pay for this dinner in its entirety, which, given the gender parity we have previously expressed in our relationship, would normally cost me only half that.

In the meantime, I need to get back home. My utility calculations tell me that the best thing I can do right now is strip down to my boxers, microwave a quesadilla, and watch a bunch of episodes of The Wire. It might seem strange and horribly unproductive, but it’s not me — it’s just my utility function.

Healthy Food? Huddle House Won't Be Serving That Anytime Soon

NPR News - Mon, 2014-09-08 10:53

Huddle House says its customers don't want healthy options or calorie counts. But by defying healthy trends, the chain seems increasingly — and unapologetically — out of step with the competition.

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From A Chinese Apartment To Wall Street Darling: The Rise Of Alibaba

NPR News - Mon, 2014-09-08 09:54

Chinese e-commerce giant Alibaba's initial public stock offering in New York is expected to be one of the biggest ever. It's come a long way since a former English teacher founded it in 1999.

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In The County Where Ebola First Struck Liberia, A Cry For Help

NPR News - Mon, 2014-09-08 09:43

The virus reportedly crossed the border from Guinea into lush Lofa County in March. Health workers risk their lives to care for the sick — and are "flabbergasted" at the lack of international aid.

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After A Tumultuous Summer, Ukrainian Kids Return To School

NPR News - Mon, 2014-09-08 09:42

With Ukraine in an uneasy cease-fire, schoolkids returned to class this month and attempted to resume normal life. They tell what back-to-school feels like when their country's been at war all summer.

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NFL's Baltimore Ravens Cut Ray Rice After New Video Surfaces

NPR News - Mon, 2014-09-08 09:32

The video apparently shows Rice's then-fiancee, Janay Palmer, being hit in the face. The running back was initially suspended for two games; now the league has suspended Rice indefinitely.

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Harvard To Get $350 Million Gift From Hong Kong Group

NPR News - Mon, 2014-09-08 07:22

The School of Public Health will be renamed in honor of H.T. Chan, whose son, a longtime university benefactor, received two degrees from Harvard in the 1970s.

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Chick-Fil-A Founder S. Truett Cathy Dies At 93

NPR News - Mon, 2014-09-08 07:14

S. Truett Cathy's Chick-fil-A has now grown to $5 billion in annual sales, and its stores still close on Sundays, reflecting its founder's religious beliefs.

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Electrolux gets a deal, GE Appliance finds a home

Marketplace - American Public Media - Mon, 2014-09-08 07:00

Swedish consumer appliance company Electrolux announced its plan to buy GE Appliances for $3.3 billion. GE, parent company of GE Appliance, is probably breathing a great big sigh of relief.

GE is a very large company with subsidiaries in aviation, oil and gas with net profit margins in excess of 15 percent, whereas its appliance division is only making around 5 percent. 

“Relatively speaking, it’s been neglected for years and financial performance has been poor,” says Brian Langenberg, principal at Langenberg & Company. “General electric is selling it for at least a third less than what they should be selling it for; they just want out.”

Electrolux, on the other hand, is getting a deal.  

“It gets them into the American market, which is a market where they haven’t been much of a factor,” says Erik Gordon, professor of business law at the Ross School of Business at the University of Michigan. “That’s important because the American market is growing at 6, 7, 8 percent, but Electrolux’s main market, Europe, is not growing at all; less than 1 percent.”   

Electrolux also gets a 48 percent stake in Mexican appliance company Mabe, extending its reach in North America even further. 

Meteor Leaves 40-Foot Crater Near Managua's Airport

NPR News - Mon, 2014-09-08 06:20

The space rock, thought to have broken off from an Earth-passing asteroid, left a hole 16 feet deep just outside the international airport in the Nicaraguan capital.

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Arab League Chief Urges 'Confrontation' With Islamic State Militants

NPR News - Mon, 2014-09-08 05:08

In apparent backing of the U.S., Nabil Elaraby tells the 22-member organization that it needs a "comprehensive confrontation" with the extremist group.

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