Marketplace - American Public Media

DiamondCandles is a North Carolina-based online business which sells eco-friendly candles that come with a surprise ring inside.

"It's kind of like a Cracker Jack box," says CEO Justin Winters.

Depending on your luck, you can win a ring worth anywhere from $10 to $5,000.

DiamondCandles attracts customers mostly over the web. But what online activity actually leads to candle sales? Banner ads, Facebook "likes", links to the time you were on public radio?

To make sense of it all, DiamondCandles turned to a New York startup called SumAll, which has come up with a way to let clients look under the hood and see the stats on what online action caused what online reaction.

SumAll's founder Dane Atkinson says big Internet companies have a mountain of data on this, but getting the information and then parsing it is tricky.

"It's terrifying how much data they actually collect on your behalf, but they don't show it back to you," says Atkinson. "Google is actually one of the better tools out there, but many of them keep 90 percent of the information in the cloud, invisible to you."

That's where SumAll steps in. The company seeks out all of its client's information and, as their name suggests, sums it up in easy-to-understand stats and figures. So what's a Facebook "like" worth?

"On average across all our customers, a 'like' is worth a little bit under $1, an Instagram photo is worth a lot more, a post can be worth hundreds of dollars," says Atkinson.

To hear more about the value of social media advertising, click on the audio player above.

The government has revised its latest GDP figures, saying the economy grew at a rate of  0.1 percent during the last three months of 2012. Still, the increase was the weakest GDP performance in two years.

Diane Swonk, chief economist at Mesirow Financial, joins Marketplace Morning Report host Jeremy Hobson to discuss the underlying factors behind the numbers and whether the sequester could threaten GDP growth going forward.

Japan's prime minister Shinzo Abe said today that he wants to bring some of the country's nuclear plants back online. That reverses a decision to phase out nuclear energy following the Fukushima disaster.

In his speech to parliament, Abe said Japan cited the need for energy security. The country, which does not have its own energy resources, must import large volumes of natural gas, oil and other fossil fuels from around the world in the absence of nuclear program.

Despite Mr. Abe's intentions, heavy opposition and tougher regulations set to come into effect this summer will make it harder for idled plants to re-open. Not to mention the costs -- some experts estimate it may cost $11 billion to get the plants back online.

J.C. Penney had another tough quarter. Sales were down 28 percent -- more than half a billion dollars. 

When Ron Johnson became J.C. Penny’s CEO, in 2011, he crunched the numbers. 

“And his argument was,'This is ridiculous,’” says Jean-Pierre Dubé, professor of marketing at the University of Chicago’s Booth School of Business. “‘People are just coming for deals. What J.C. Penney needs to do is offer value.’”

So, Johnson invested in new merchandise, and built specialty boutiques in J.C. Penney stores. He also got rid of two things J.C. Penney was known for: Sales and coupons. 

That backfired, and last summer, he brought some of them back. 

According to Ken Homa, a marketing professor at Georgetown University’s McDonough School of Business, the retailer has sent some mixed messages.

“I think that consumers out there just have no idea what to think about J.C. Penney at this time,” he says.

Yesterday, on a conference call with investors, CEO Ron Johnson defended himself.

“I told you transformations are unpredictable and can be bumpy, and this one has been,” he said.

When Johnson started at J.C. Penney, he predicted there would be profits in a matter of months. Yesterday, he said the company’s transformation will take years.  

Bankers in Europe could be facing a cap on their bonuses as early as next year. EU officials announced an agreement today that would restrict pay at all banks based in Europe -- and any units of European banks based abroad.

If passed, bankers' bonuses may not exceed the amount of their basic salary, but the amount can range higher with shareholder approval. Predictably, reaction from the banking community has been unfavorable.

"It is going to exert at the very least some kind of constraint on what bankers can get paid and they would really rather not have any such restrictions," says the BBC's Economics correspondent Andrew Walker.

There is a fear that if the bonus cap is made into law, banks may decide to move operations to the United States or other business centers in Asia that do not have such tight restrictions.

The U.S. is now just a day away from the sequester -- the $85 billion in across-the-board federal spending cuts that came out of the debt ceiling debacle of 2011. While it’s tough to find an economist that thinks the cuts are smart policy, the sequester is unlikely to be averted before tonight's midnight deadline.

U.S. Senator Charles Grassley (R-IA) joins Marketplace Morning Report host Jeremy Hobson to discuss the sequester and its likely impact on the economy.

On whether the sequester can still be avoided:

It's a done deal for a short period of time, possibly a long period of time, but there is no way there is going to be a bill to the president for signature before March 1, so then you do go into sequester. I don't think there is going to be any immediate impact, but people will seriously negotiate [at that time].

On whether the sequester will be undone retroactively:

It's pretty difficult for me to predict. But strategy and the way congress operates and the fact that most people don't believe these automatic, across-the-board reductions are the best way to do business. Common sense dictates that you go to the table and you work out something. But if it doesn't get worked out, then this is going to be the policy through September 30.

On Washington's continual fiscal deadline crises:

To be perfectly candid, I think legislative bodies -- not just the Congress -- tend to function under deadlines. But you also have to remember that Congress is not the only player here. The president of the United States suggested this during the summer of 2011 because he didn't want to have any votes on increasing the debt limit prior to the election. Now it looks like the president is showing the leadership that he should have shown over the last 18 months.

On whether Washington will face a government shutdown next month:

Absolutely not. We learned a lesson in 1995 that you don't save any money by shutting down the government. Continuing resolutions will be passed to fund the government at the same level [as the last six months]. It's pretty common sense, if government can function for six months under X-number of dollars, they can fill out the year under those same X-number of dollars.

There are new numbers today about just how deep the technology gap is when you compare richer and poorer school districts in America. A new study by Pew Research Center's Internet and American Life Project finds that 8 out of 10 teachers think technology is leading to wider disparities between the haves and have-nots.

In richer districts, 52 percent of teachers had students look up information online as part of the class discussion. The report shows it drops to 35 percent in poorer areas. The teachers surveyed taught AP classes or were part of the National Writing Project.

Lee Rainie, Director of the Pew Research Center's Internet & American Life Project, joins Marketplace Tech host David Brancaccio to explain what's behind the disparity and how it is affecting classrooms. 

See the report below:

How Teachers Are Using Technology at Home and in Their Classrooms (Pew Internet & American Life)

You've heard of a bullseye. What about a ball's-eye? A Carnegie Mellon post-doc student and Japanese researchers have come up with a way to get smooth video from inside a spinning football.

Kris Kitani at CMU's Robotics Institute says regulation footballs may not be able to include the technology but the system might be cool for TV coverage of games or for training.

The trick:  Stabilizing the image on a football that can rotate at a nausea-enducing 600 rpm. Don't miss the side by side comparison of the stabilized and unstabilized video from a tossed ball below.

If the massive budget cuts known as "sequestration" come to pass, federal workers aren’t the only ones who will get a pay cut. Some of the hardest hit will be those who can afford it least -- the long-term unemployed.

After state unemployment insurance benefits run out, usually after 26 weeks, the federal benefits kick in. Those generally last for an additional 37 weeks, paid for with federal money.

Under sequestration, that extension would get a serious haircut.

“That’s going to translate into an 11 percent reduction in benefits,” says Maurice Emsellem, policy co-director at the National Employment Law Project. “It’s going to have a devastating impact on about two million unemployed workers who are receiving federally-funded benefits.”

Over the course of the fiscal year, Emsellem says a total of four million workers could be impacted. And the cuts will also reduce the funds that pay state employees to administer the program.

Sherri Summitt of Unionville, Indiana, relies on long-term unemployment benefits. She says her state administrators are under enough pressure already.

“Any time you call, you get no answers. You speak to people with no experience,” says Summitt.

It could have been worse.Until yesterday, Indiana threatened to suspend the federal program altogether. Now it plans to pay the long-term unemployment benefits at least through March 9th.

The Supreme Court is expected to take up same-sex marriage in March, and the business community has something to say about it. Yesterday, more than 200 employers signed onto a "friend of the court" brief making the business case for marriage equality. Today lawyers are expected to file a similar brief.

If you scan down the list of companies signing on to the documents, one industry stands out: Tech -- big deal tech, like Apple, Facebook and eBay.

So, why do it?

“I think it’s a mix of idealism and pragmatism,” says Stanford law professor Jane Schacter. Idealism, she says, in that a lot of these companies support marriage equality, plain and simple. And, says Schacter, “I think on the pragmatic side, they’ve made the calculation that for a number of reasons this is actually good for their business.”

One reason, companies in states like California -- that don’t allow same sex marriage -- are at risk of losing employees to states that do.

But it’s also a reflection of how much things have changed culturally.

“Opinion has shifted enough in the last couple of years that they are more worried alienating people by not taking a position than they are by taking a position,” says Harvard professor Michael Klarman.

But whether or not it matters to the court, we’ll have to wait and see.  

We're just a day away from the sequester -- the $85 billion worth of  federal spending cuts due to kick in Friday.  Unless Washington changes its mind, some federal workers stand to lose as much as 20 percent of their pay.

Erika Townes is a nurse at Andrews Air Force base in Maryland. She makes less than $50,000 a year, and has been fighting foreclosure. So when Townes heard she might have to take unpaid leave one day a week because of sequestration, her first thought was, "Will I keep my house? What bills will I be able to pay?"

“With the sequestration, now we’re talking about full-on juggling," Townes says. "Let me put something on this, let me put something on that.”

Ironically, Townes could lose her job if she runs up too much debt, trying to make up for the sequester pay cut. Her job requires a security clearance. She has to maintain a certain credit rating to keep her clearance and her job.

“The Department of Defense is not going to say, oh well, you know, sequester, that’s OK," she explains. "That’s not how it works.”

Since borrowing could put their jobs in jeopardy, Defense Department workers will have to turn to other sources of aid if they’re forced to take unpaid leave. The union office on Andrews Air Force base has prepared packets of information on local shelters, food banks and counseling services.

Octavia Hall, president of the local branch of the American Federation of Government Employees, says the sequester would lop 20 percent off of her members’ paychecks when their take-home pay is barely enough to cover their bills, as it is.

“Take home, $900," she says.  "For two weeks. So cancel 20 percent off of that.”

That 20 percent pay cut would ripple through the economy. Stephen Fuller, an economist at George Mason University, says the sequestration cuts would shave one percentage point off of economic growth this year. He says an economy that’s been staggering anyway will be punch drunk after sequestration.

“You can have a good time without getting smashed," he says.  "And the sequester is getting smashed and it will have enormous short term consequences that won’t achieve any purpose.”

Fuller says those consequences won’t be felt immediately if sequestration kicks in. Federal workers have to be given at least 30 days notice of any unpaid leave.

Erika Townes says that’ll give her time to think up a plan B, and maybe start looking for a second job. 

Think about your favorite foods. About how they taste and how they make you feel. A lot of the foods we crave -- and we use that word intentionally -- are so good because of three main ingredients: Salt, sugar and fat.

When mixed in just the right amounts, they're an almost irresistible combination. And the food industry knows it.

"Salt, Sugar, Fat" is also the title of Michael Moss's new book about how food companies keep us coming back for more. They've built a sophisticated system, from food engineers looking for the exact combination of flavors to inspire the deepest craving, to marketing departments that coach kids to beg parents for Lunchables and sugary snacks.

One of the tricks of the trade? Vanishing caloric density. "If you can fool people into a product that melts in their mouth, their brain is less apt to detect that there's a ton of calories in there."

But Moss says it's not quite as black and white as "healthy" or "unhealthy." Food companies may have goals to provide healthy food, but they're also sensitive to what shoppers are putting in their carts. And there's financial pressure. "Every time the companies cut back a bit, Wall Street is there, watching the sales, watching the profits, urging the companies to go back to salt, sugar, fat. And they do."

As for his own favorite tastes? Moss says he usually craves salty and fat-filled treats.

There's some new data out today from Brandeis University on the racial wealth gap in this country. It has tripled in the past 25 years. Whites getting richer, African-Americans not. The study's ongoing -- the same set of families, black and white; 25 years of research into total wealth, not just paychecks.

Tom Shapiro did the analysis, which points to housing as a huge factor, how where you live affects how much wealth you have.

"As homes are bought a little lower down in the socioeconomic ladder, housing wealth does grow," Shapiro said. "But the point is it doesn't grow nearly as much or as fast."

When Shapiro first started the study in 1984, the total wealth gap between blacks and whites was $85,000. In 2009, that gap had tripled to $236,500.

"For a typical white family, a $1 increase in average income over the 25 years returns about $5 of wealth," Shapiro said. "For that same typical African-American family -- that same $1 average increase in income -- returns only 69 cents in wealth...Part of the equation there is that that typical African-American family has less wealth to start out with than the typical white family."

Shapiro said data show that the wealth in the African-American community has gone up tremendously over the past 25 years, but "we need to keep growing in a way that bring the African-American, or the communities of color, line closer -- that is, put it on the same trajectory of growth and prosperity as that of the white wealth growth line."

And if we don't, Shapiro said, "I fear. I know what toxic inequality looks like. Shared economic prosperity needs to be spread much more broadly for the United States to compete globally as an economy."

The tentacles of the sequester could cling to your tax refund. A chunk of the more than $300 billion the IRS refunds each year could be delayed if the sequester forces the agency to furlough workers.

The average refund is nearly $3,000, which is serious money to people like Claire Goodwin and her husband Trevor McQuain in Fort Collins, Colo. Just days before they filed their tax return, Trevor lost his job as a mental health counselor. That makes their refund especially important this year.

“To have that extra money, we will be able to not worry as much as we would in terms of being able to pay our mortgage as he looks for a new job,” Goodwin says.

The prospect of a delay is troubling for families who count on a refund to make ends meet. It’s also setback for those who want to spend it on home improvement or a major purchase. And, given the IRS hands money back to more than 100 million income-tax payers a year, widespread delays would be felt across the economy.

“That would be significant and could certainly be another damper on growth in the first half of the year, which many people seem to be worried about at the moment,” says Cary Leahey, chief U.S. economist at Decision Economics.

It’s not just refunds that are on the line. IRS employees who man help desks and enforcers who look for fraud would also work reduced hours. That means taxpayers seeking answers may struggle to get them. And some cheats may slip through the cracks.

The good news is unionized IRS employees must get 30 days notice before being furloughed. That hasn’t happened yet. The bad news is a furlough could hit in April, hindering the returns of those who file close to deadline.

“It’s like the busiest time of the year, actually,” says Colleen Kelley, president of the National Treasury Employees Union, which represents 78,000 IRS workers. “From the middle of April to the middle of May is really when so much of the work of the IRS processing for the filing season is done.”

A sequester crunch wouldn’t be the first delay this tax season. Because of the last minute fiscal cliff deal, the IRS had to scramble to reprogram and test its systems. That holdup is why it’s still not ready to accept certain tax forms and won’t be until sometime in early March.

All this appears to be slowing down refunds. Treasury Department numbers show that through February 22, refunds were $15.7 billion lower than this time last year. The prospect of further delay is infuriating taxpayers.

“I mean, that’s money we’ve paid in and money that is ours rightfully and I think we should be able to get that in a timely fashion,” says Dr. Melanie Ellis, a veterinarian in Walnut Creek, Calif.

She expects a refund when she and her husband Stephen Ellis file. She owns a veterinary practice and says her business hasn’t fully recovered from the recession. She’s planning to use their personal tax refund to shore it up.

“We’re gonna need the money to pay bills, help make payroll and keep us in cat food,” she explains.

Whether it’s a prolonged wait for Meow Mix, home repairs or emergency cash, a sequester-delayed refund would alter the plans of a lot of Americans. The advice to taxpayers wanting a swift refund is the same as always: first come, first served. That’s why Claire Goodwin and Trevor McQuain in Colorado filed very early. They now have their money in hand. Those who don’t do taxes soon may not be so lucky.

Kai Ryssdal: What I'm about to say may be the very definition of a day late and a dollar short -- $85 billion short, more like.

We learned this morning President Obama and Congressional leaders have set a meeting to talk about the sequester -- the budget cuts -- that're supposed to start hitting on Friday. They're gonna meet on Friday. So if you're layin' odds, the likelihood of those cuts actually happening would seem to be fairly high.

That being the case, maybe it's time to start thinking about what might happen as a result. There are a lot of stories to do on that score. So we'll pick just one: The one in which your tax refund gets...sequestered.

Marketplace's Mark Garrison explains.

Mark Garrison: The average refund is nearly $3,000, which is serious money to people like Claire Goodwin and her husband Trevor McQuain of Fort Collins, Colorado.

Claire Goodwin: We ended up filing a couple days after my husband was let go from his job. So for us, to have that extra money, we will be able to, you know, not worry as much as we would in terms of being able to pay our mortgage as he looks for a new job.

A refund hitch would be troubling for families who count on the money to make ends meet or who want to spend it on home improvement or a major purchase. The IRS handed back more than $300 billion last year. So the economic ripples of a delay could be widespread, says Cary Leahey of Decision Economics.

Cary Leahey: That would be significant and could certainly be another damper on growth in the first half of the year, which many people seem to be worried about at the moment.

Inside IRS offices, the worry is about the steady flow of filings. If staffers get their hours cut in the sequester, that paperwork will pile up into a formidable mountain. Colleen Kelley is president of the National Treasury Employees Union. It represents 78,000 IRS workers, including those that process your tax returns.

Colleen Kelley: Timely processing of those refunds is dependent upon the IRS having the staffing to do that.

It’s not just refunds. Help desk staff and enforcers who sniff out tax cheats would also be cut. The good news is employees must get 30 days notice before being furloughed. That hasn’t happened yet. The bad news is a furlough could hit in April, just as returns pour in before the deadline.

Kelley: It’s like the busiest time of the year, actually. From the middle of April to the middle of May is really when so much of the work of the IRS processing for the filing season is done.

A sequester crunch wouldn’t be the first delay this tax season. Because of the last minute Fiscal Cliff deal, the IRS scramble to reprogram systems held up processing. It’s still not ready to accept certain tax forms and won’t be until sometime next month. All this appears to be slowing down refunds. Treasury Department numbers show they’re billions less than this time last year. The prospect of further delay is infuriating taxpayers.

Dr. Melanie Ellis: I mean, that’s money we’ve paid in and money that is ours rightfully and I think we should be able to get that in a timely fashion.

Dr. Melanie Ellis expects a refund when she and her husband Stephen file. She owns her vet practice in Walnut Creek, California. Business is still down since the recession. She’s planning to use their personal tax refund to shore it up.

Ellis: We’re gonna need the money to pay bills and, you know, help make payroll and keep us in cat food.

Whether it’s Meow Mix, home repairs or emergency cash, a sequester-delayed refund would alter the plans of a lot of Americans. But not Claire and Trevor in Colorado. They filed very early and got their money this week. Those who don’t do taxes soon may not be so lucky. In New York, I'm Mark Garrison, for Marketplace.

It’s about 8 o’clock on a Thursday night and this Nairobi supermarket called Uchumi is packed with evening shoppers. Engineer Dee Kerubo has come to buy toiletries and whatever else catches her eye. “I got a Kit-Kat too,” Kerubo laughs.

At the cash register, she pulls out a bright red plastic card -- her Uchumi loyalty card. The cashier swipes it and it makes a loud “BEEP!”

That “BEEP!” is the sound of data, going from Kerubo’s card to a huge computer room in the back of the store.

Uchumi’s information manager, Charles Thuku, explains that “we got our cables over here going all the way to the tills, so as the cashiers are selling we are able to get hold of that information, have it saved in the server.”

With 21 million customers a year, the Uchumi chain makes up about a quarter of Kenya’s supermarket sector. But Thuku thinks Uchumi could be more competitive if it could just dig deeper into customers’ information.

“We interested to know the basket size of a customer,” Thuku says, “their frequency, how often they come in our stores to shop. What are the items they normally get when they come to do the shopping?  So that’s the information that we are quite interested in.”

That’s where data analyst Karibu Nyaggah comes in. Nyaggah runs Caytree Partners, a Kenyan analytics firm he founded last year.

Nyaggah says data analytics can open up consumer information not just in retail, but in the financial sector as well. He says Kenya’s banks especially could use more data.

“For example, every credit card company in the U.S. shares with the credit bureau who their account holders are -- everyone knows that you’ve had these set of accounts and how you’ve handled them. In Kenya there’s no such sharing and so when you come into my bank to open an account, you may seem like a perfectly decent guy, but you might also be a really big fraudster,” Nyaggah says.

Nyaggah hopes that if Kenyan banks can have more data transparency and make a credit score system, then they can sort out the credit worthy from the crooks.

“And it’s quite exciting,” he says, “because the net result of that effort is more folks have access to credit, which is a huge enabling factor in growing the economy.”

The problem is data analytics is expensive, and many Kenyan companies aren’t ready to make the investment yet. But luckily for supermarket Uchumi, someone else might be willing to pay. Multinational Unilever has expressed interest in paying Uchumi to have easier access to its customers’ information.

Because even if Kenya’s companies don’t yet see the value of the country’s consumer data, the global marketplace does.

The beverage giant Anheuser Busch InBev is at loggerheads with customers in California, Pennsylvania and New Jersey. They've filed lawsuits saying the company's beer is watered down.

It's not complicated to measure the alcohol in beer, says Peter Reid, publisher of Modern Brewery Age. All you need is this ancient glass tool called a hydrometer. "This is a very old piece of technology. It dates back to the Greeks," he says.

Mega brewers, like InBev, now also use sophisticated computers and robots to check alcohol levels. It's doubtful they ever get it wrong. Yet that is the basis of the lawsuits, that the "5 percent alcohol by volume" label on Budweiser and other InBev U.S. beers is false. They say the beer has been watered down.

Reid says lawsuits over alcohol levels are common, but usually in the opposite direction. "Often times, beverages are pilloried for being too strong," he says. "You have products like Four Loko or malt liquors."

Beverage industry consultant Tom Pirko says the lawsuit is about more than technicalities. "It's probably really about confidence and trust. Are we really getting what we paid for?"

He says U.S. customers are already kind of suspicious of the big brewers. InBev, based in Belgium, has a reputation for cutting costs and watering down other brands it has bought. But InBev wouldn't save very much money by watering down Budweiser in the way the lawsuits claim, says beverage analyst Thomas Mullarkey at Morningstar.

"Shareholders are only rewarded if customers keep buying the beer," he says.

The risk to Budweiser's reputation would be much greater than the $5 million in damages sought by the lawsuits.

The defining experience when using a smartphone is the diverse set of apps, the little programs, you load on it to make the phone do things. Increasingly, there's a choice of operating system, too. Sure there's Apple iOS, Google Android, Windows Mobile -- but at a big conference on mobile technology in Barcelona, Spain, a Samsung phone using a strange operating system was announced.

Samsung's new OS is called Tizen, and there are other rivals coming soon, including one from the browser maker, Firefox.

Sarah Rotman Epps, senior analyst at Forrester Research, joins Marketplace Tech host David Brancaccio to discuss where Tizen will be used and why Samsung is launching the new alternative system.

Apple has agreed to settle a class action lawsuit brought by angry parents who said their kids racked up big bills on iTunes purchases. They're called "in-app" purchases and they usually let players of a free game buy extra weapons or to get to a new level or get a whole bunch of virtual goldfish.

That's what happend to Mike Betrand of Boca Raton, Fla. A couple of years ago, his three young children got very into a free iPad game called Tap Fish. "It’s a little virtual aquarium," he explains. "If you want to buy different tanks or you want to buy little castles or little fish, you have to use what appears to be play money."

Thing is, it's not play money. Bertrand discovered this when he happend to notice an Apple iTunes receipt in his email for $149.

"I started going through some other receipts that were trapped in my spam folder and found out that, over the course of about a week, my kids tallied about $1,500 on the game."

Bertrand says his kids had no idea what they'd done. "The kids were very surprised to learn that they were spending real money and really confused about it."

In the proposed settlement, Apple will compensate 23 million angry parents who say the company didn't have proper parental controls in place for in-app purchases. Apple will dole out $5 iTunes gift cards to many parents. Those whose charges topped $30 will get a seperate reimbursement.

Colby Zintl of advocacy group Common Sense Media applauds the ruling, a notes that Apple has since put in place an option that will allow parents to block those purchases. Still, Zintl says, these supposedly free games need standard protections.

"In the case of a game like Smurfs, these kids aren’t even reading," she says. "The ability to press a button and you’re charging your parents’ credit card, you have to question what the business practices are." 

Rene Ritchie, editor in chief of tech news site iMore. says those business practices grew out of Apple's app marketplace. He points out early app games charged as much as $10. But nobody wanted to pay that much, "and this model emerged called 'fremium,'" he says.

That’s when the game itself is free, but things inside the game cost money. "Instead of having to earn something in a game, you just buy it," Ritchie says. "Instead of having to wait for your car to get more power or your solider to get more life back, you can buy it immediately. People lose patience and spend money on the game."

Betting on impatience works. Ritchie says all of the top grossing games right now are free...ish.

And they're going to stay free if Mike Bertrand has anything to say about it. "My kids don't know my iTunes password anymore," he laughs.

SAT:College ::

A.) beaver:mercedes

B.) quickly:galaxy

C.) mitochondria:zooxanthellae

D.) marmelade:Harrison Ford

The answer is obvious, of course, and you should feel deeply, deeply ashamed if it's not. Just close your web browser or phone now, and leave. Otherwise, read on.

The SAT is about to undergo some major changes. According to a letter from David Coleman, the president of the College Board, the main purpose is to "increase the value of the SAT." For students, that means, "focusing on a core set of knowledge and skills that are essential to college and career success." For admissions officers, it means being a better predictor of college success, and for K-12 educators, it means making the test more reflective of what's taught in classes.

From a business perspective, there may be another reason: market share. Scott Jaschik, editor of Inside Higher Ed, says many people suspect “the reason the SAT is changing is that the ACT last year overtook the SAT by a very small margin.”

The ACT is the other big admissions test, and the number of students who take it grew 50 percent in the past decade -- 1,666,017 students took the ACT at least once in 2012, versus 1,664,479 who took the SAT.

The ACT used to be primarily a mid-west phenomenon, but it has expanded its range. It's become a required high school exit exam in some states, and it's sometimes viewed as more closely connected to a high school curriculum. The ACT may also just be another exam for people who didn't like how they did on the SAT.

But fighting over market share aside, both ACT and SAT are facing a certain amount of criticism. Wake Forest University, for example, is "test-optional" -- you don't have to take the SAT or the ACT.

“So are 38 percent of all four-year degree granting institutions in the united states," says Joseph Soares, professor of sociology at Wake Forest University and author of "SAT Wars." "It conveys no additional useful information over and above what the high school transcript tells us,” he argues -- and even does so at a cost.

Richard Kahlenberg, senior fellow at the Century Foundation, says standardized tests like the SAT and ACT, "reinforce racial and socioeconomic inequality."

But he also says selective schools will still be interested in the exams for their predictive power. "The SAT provides a way of comparing between high schools," he says. Comparing different high schools can sometimes be like comparing apples and oranges, but Kahlenberg says, "It does have predictive value in the first year of school. Which is not irrelevant, because you don’t want to admit students who are likely to fail."

Either way, many schools still value the ACT and SAT and require at least one. Plus, more than a million and a half students each year continue to take one or both standardized tests, whether their favorite school cares or not. According to Scott Jaschik with InsideHigherEd, most colleges that go test-optional still accept SAT and ACT scores, and two-thirds of applicants continue to submit them.

In other words, students will never pass up an opportunity to prove themselves.

Two days away from the sequester, the Dow is pretty much right where it was a month ago. Why is Wall Street seemingly unfazed by Washington's latest fiscal deadline?

Can Groupon revive the daily deal and itself? As the company reports fourth quarter earnings, its new business model will be in the spotlight.

And Internet service providers are rolling out a "six strikes" policy to educate rather than punish people for illegal downloads.