Money world

Snail mail might soon get even slower.

The cash-strapped U.S. Postal Service announced Tuesday that it will incur about $238 billion in losses in the next 10 years if Congress doesn’t permit it to revamp its outdated business model.

The agency is proposing an adjusted mail service schedule, which will likely cut Saturday delivery, and eliminating its prepaid retiree health benefits. That alone, it says, will cut $90 billion in costs over the next 10 years.

The challenges hurting USPS’s bottom line reflect a "macro change in society," Postmaster General Jack Potter said at a press conference Monday previewing the proposed changes. "All posts around the world are challenged, just as we are, by the diversion of hard copy to electronic medium."

USPS unveiled a list of cost cutting measures, including closing some branches and raising its prices, two moves which would both require Congressional approval. The agency also said that it expects to save another $123 billion between now and 2020 by renegotiating transportation contracts, cutting work hours, and expanding use of self-service kiosks in grocery stores and other popular retail spots — measures that don’t require Congressional approval.

USPS is trying to curb steep losses. It posted a $3.8 billion loss in its 2009 fiscal year, the latest in a multiyear string of whopping losses. Mail volume was down 12.7% for the year, a trend the agency expects to continue over the next decade as more consumers opt for online bill payments and message delivery.

The Post Office was $10 billion in debt as of Sept. 30 — not far off from its $15 billion debt limit, which the agency expects to hit in its 2011 fiscal year.

USPS spent $4.8 million on studies by outside consultants, Accenture, the Boston Consulting Group and McKinsey and Co. to forecast a 10-year outlook and present a plan that the agency calls both "ambitious and aggressive." Any changes to the government agency’s business model would have to be reviewed by the Postal Regulatory Commission, presented in a series of public hearings and approved by Congress.

The Post Office, an independent government agency, does not receive taxpayer dollars and is funded entirely by its own revenue. However, the Postal Reorganization Act of 1970 constrains the agency’s operations. It prohibits USPS from closing small branches based solely on economic factors, and prevents the agency from expanding its services beyond postal delivery free credit report online.

Post offices in some countries, including Italy and Japan, have boosted their sales by offering ancillary services, like banking. But unless Congress steps in, USPS cannot expand beyond the postal-mail realm.

Postmaster General Potter said relaxing some of the agency’s stringent regulations could allow it to tap into its strengths as one of the largest retail networks in America, as well as "The Most Trusted Government Agency" — a title USPS has won the last five years in a row.

With 32,000 post offices throughout the country, USPS has more retail locations than McDonald’s (MCD, Fortune 500), Starbucks (SBUX, Fortune 500), Wal-Mart (WMT, Fortune 500) and Walgreens (WAG, Fortune 500) combined, Thomas Dohrmann, partner at McKinsey & Company, said in the presentation Monday. That said, the average foot traffic for a post office is about one tenth of that at Walgreens — a mere 600 weekly customers.

USPS has already begun taking the axe to its budget. The agency made $6 billion in cuts last year, reducing its workforce by about 40,000 employees and chopping overtime hours, transportation costs and other expenses. Congress passed legislation allowing the organization to cut retiree health benefit payments by $4 billion.

Despite those measures, the agency still expects a net loss of $7.8 billion in fiscal 2010.

USPS employs about 600,000 workers and currently has a nationwide hiring freeze. Additionally, Chief Financial Officer Joseph Corbett says he expects to reduce its payrolls by the equivalent of 50,000 full-time employees in fiscal 2010 through natural attrition and by reducing overtime hours. The agency also wants to renegotiate its contracts with four unions in order to gain greater flexibility in scheduling part-time workers and moving employees across departments.

A significant postal price hike is also under consideration, although the price most consumers care about — the rate for a first-class stamp — is locked in at 44 cents for 2010.

"At the end of the day, I’m convinced that if we make the changes that are necessary, we can continue to provide universal service for America for decades to come," Potter said. "We can turn back from the red to the black, but there are some very significant changes that are going to have to be made." 

Source

Lending cash to individuals looking for cash advance or payday loans.

Good news for Zhu Zhu fans: The fuzzy electronic hamsters have quickly multiplied from just four last year to more than 40 new ones that will hit stores by summer.

The $10 Zhu Zhu Pets, which scurry around the floor making squeaks and interact with each other in separately sold habitats, were the hottest-selling toys of 2009.

According to Cepia Inc., the company that launched the toys last year, more than 7 million U.S. households are already owners of Zhu Zhu hamsters such as the hugely popular "Mr. Squiggles" and "Pipsqueak."

Bruce Katz, vice president at Cepia, said the company has so far raked in about $70 million from worldwide sales of these toy rodents.

But that was last year. The buzz ahead of the upcoming annual Toy Fair in New York is all about what Cepia has in its toy chest for this year.

Katz provided a sneak peek on Thursday. Among the new Zhu Zhus is a line of four hamsters called Rockstars names "Pax," "Kingston," "Rider" and "Roxie." The names are inspired by the children of celebrities, including Angelina Jolie and Gwen Stefani.

"Rockstars are the first long-haired hamsters with attitude," said Katz. Although the hamsters don’t interact with each other, Katz said a smart chip in each toy gives it its own unique personality.

Katz said the new "Wild Bunch" collection extends the brand beyond hamsters. "There’s a skunk, hedgehog, raccoon and a bunny," he said.

"The appeal of this new collection is that these are animals that every child wants to have but parents won’t let them have it," said Katz

There’s also a much-anticipated Kung Zu line of fighter hamsters geared primarily for boys aged 8 to 12.

Cepia will introduce 40 new Zhu Zhu characters in total this year, launching a new line every six weeks, said Katz.

And if that isn’t enough Zhu Zhu for you, Katz said Cepia is introducing new "play environments" that include cars, boats, an elevator and a beauty salon for these toy hamsters.

"The car, boat and other toys are all hamster powered," said Katz, explaining that the running wheels on each Zhu Zhu toy powers the car, boat and elevator into action.

But given that kids can easily become bored with one type of toy, isn’t Cepia worried about a Zhu Zhu overkill?

"We think that with what we shipped last year, we’re not even close to fulfilling demand in the marketplace," said Katz. "Kids love to collect, and there’s a strong collectible aspect to Zhu Zhu." 

Source

Payday loans no faxing fall on the less risky side simply because the money loaned to you is a percentage of your next paycheck.

Oil prices plunged Wednesday on a stronger dollar and amid investor concern that the Chinese government will continue to tighten its credit policy.

What prices are doing: Oil fell $1.87, or nearly 2%, to settle at $77.62 a barrel, after dipping as low as $76.96 a barrel earlier in the session.

On Tuesday, oil rose for the first time in six days, recovering from its lowest level so far this year.

What’s driving prices: Reports that China has asked major banks to cease lending until the end of the month in order to tighten the country’s credit market spooked investors. The news comes a week after the Chinese government raised bank reserve requirements for the first time since 2008.

"This shows us that China is serious about slowing down its explosive demand growth," said Phil Flynn, a senior market analyst at PFG Best. "If the Chinese government continues to take steps to slow the economy, it’s going to be bearish for prices in the short term fast cash now."

Meanwhile, the dollar rose as investors lost their appetite for risk, worrying about China’s attempts to slow its economic growth.

"That market seems to be on fire today," he said. "The dollar’s incredible strength is definitely going to put pressure on the market."

What analysts are saying: "It’s going to be harder and harder to maintain these prices," said Flynn. "There’s no doubt the economy is getting better, what is in doubt is whether that translates into $78 to $80 prices for oil."

Flynn said he wouldn’t be surprised to see a major sell-off in the next couple of months and he predicts that oil may drop as low as $40 a barrel. 

Source

Flying into Pearson International Airport offers a view of the GTA that would make even the least excitable solar entrepreneur salivate.

What’s the big deal? In a word: rooftops. Thousands of flat rooftops on hotels, manufacturing plants, warehouses, apartment and office buildings, schools, hospitals and shopping malls. Each is a sunlight sponge with the potential to take the sun’s rays and convert them into emission-free electricity.

In a province prepared to pay richly for solar power, it’s no surprise then that the race is on to lock up leases on prime rooftop real estate across the Greater Toronto Area and the rest of Ontario.

"It’s kind of like a gold rush right now," said Justin Woodward, director of solar development for Toronto-based Greta Energy Inc., which is focusing its efforts on smaller towns outside the GTA.

Greta Energy is one of dozens of emerging ventures that are approaching commercial property owners with an offer that is difficult to refuse.

Give them 20-year access to your building’s unused rooftop and they’ll kindly compensate you for the space – similar to how farmers over the years have earned income by allowing wind turbines on their property.

With that secured access, companies will design, build and own the rooftop solar system at no expense or risk to the building owner. They’ll then apply to connect the system to the grid as part of the Ontario Power Authority’s feed-in-tariff program, which for large commercial rooftops pays between 53.9 cents to 71.3 cents per kilowatt-hour and guarantees quick connection to the grid.

Payment to the building owner can come in a number of ways: a percentage of annual electricity revenues from the system, or a fixed price per square-foot of rooftop being used to host the system.

Greta Energy prefers the square-footage approach, which can vary from 10 cents to $1 per square foot but on average lands at about 30 cents. This means a 250-kilowatt system that takes up 40,000 square feet (3,716 metres) of space would result in an annual payment of $12,000 to the building owner.

"The rooftop lease works out to about 10 per cent of (electricity) revenues," said general manager Chris Young of Ottawa-based Enfinity Canada

"At the end of the term the equipment is transitioned to the building owner’s hands so he can benefit from electricity production beyond the 20-year contract."

Alternatively, compensation might be a guarantee to supply solar-sourced electricity over two decades for less than what a building owner currently pays. CarbonFree Technology of Toronto takes this approach.

The market is increasingly becoming crowded, with Ozz Solar, Helios Energy, Rumble Energy and SunOne Energy Canada among a growing list of solar rooftop aggregators knocking on doors.

Woodward said he’s noticed a dramatic change since the Ontario Power Authority announced the province’s new feed-in-tariff program on Sept. 1. He estimated that for every 10 building owners that were cold-called three months ago there would be one that had already been contacted by a competing developer.

"It’s now probably one in four calls," he said. "Right now there are a lot of small players jumping into the market, people who just get business cards made up or foreign companies just cold-calling commercial property owners."

Building owners need to be cautious, said Young, warning that some "lease consultants" are merely accumulating rooftop real estate that can be flipped for a profit.

"If they sign on with someone who is going to flip the project to someone else, that’s money out of the building owner’s pocket," he said. "Property owners should be looking for people who have a strong financial track record and are capable of following through with the project they’ve contracted for."

He said rooftops must also be inspected to ensure they are strong enough to handle the weight of both the panels and winter snow. Enfinity, for example, builds the cost of insurance into its business model to take account of possible damage to a roof.

Ben Chin, a spokesman for the Ontario Power Authority, said it’s important for property owners to do their homework before entering any long-term leasing contract.

"You wouldn’t hire a plumber without experience," said Chin

Source

General Motors of Canada Ltd. has not reversed any of its decisions to close dealerships across the country after some store owners requested management reviews.

GM spokesman Tony LaRocca confirmed Monday that 38 dealerships had objected to the company’s wind-down offer and most have pursued management reviews, but the automaker has not yet changed its closing decisions.

"None of them have been reversed so far," said LaRocca, GM’s director of communications. "But the point of a management review is to look at all the available information, so if something new is presented, then a reversal can’t be ruled out."

LaRocca said 26 dealers requested management reviews and seven have resolved their objections by accepting wind-down offers providing partial compensation for closing before the end of last year.

"In other words, those dealers felt our offer was fair after review."

LaRocca added that three other dealers that initially pursued reviews are taking their cases to mediation and the industry’s National Automobile Dealer Arbitration Program.

He said GM continues to talk to 16 other dealers in efforts to resolve their cases. That could lead to acceptance of wind-down agreements, possibly taking their cases to mediation and arbitration or a reversal of a closing.

The other 12 dealers who objected to wind-down offers have sued GM for ending their franchise agreements, in a "high-handed, oppressive and patently unfair" manner, according to their claim statement business card.

In addition to millions of dollars in damages, those dealers are also seeking an injunction prohibiting GM from ending their agreements and a declaration entitling them to remain open for at least another five years. Their current franchises expire in the fall.

GM announced last May that it would close 240 Canadian dealerships to reduce costs and qualify for about $10.6 billion in federal and provincial government aid.

About 85 per cent of the dealers who received nonrenewal notices accepted wind-down agreements and shut down by the end of 2009.

Bob Slessor, one of the dealers suing GM, said he doubts GM will reverse any decisions by the time the company completes its review.

"Even though they go through the process, there are no surprises," said Slessor, who runs a dealership in Grimsby. "A GM vice-president reads from a prepared script."

In the United States, the termination of dealers by GM and Chrysler triggered a backlash that led to legislation last month establishing an arbitration process to determine the fate of many store owners.

The legislation calls for arbitrators to “balance the economic interest of the covered dealership, the economic interest of the covered manufacturer and the economic interest of the public at large” in considering criteria such as the dealer’s profitability and business plan.

Source

Russia’s economic decline abated in the third quarter as companies began restocking inventories depleted during a record slump in the first half of the year.

Gross domestic product fell 8.9 percent from a year earlier, in line with the government’s estimate, after a 10.9 percent contraction in the second quarter, the State Statistics Service said on its Web site today. On the quarter, output grew a non-seasonally adjusted 13.8 percent.

“The model of economic development has rapidly changed,” said Anton Struchenevsky, an economist at Troika Dialog in Moscow. “Investors are much more sensitive to risk. The euphoric component has gone and this is impeding lending. There is a slight improvement, but it would be a great illusion to think we will return to the pace of growth we had before the crisis.”

The plunge in output is slowing in Russia after the government pumped $26 billion of stimulus into the economy in the first 10 months and oil prices rebounded from the start of the year. President Dmitry Medvedev has called the country’s dependence on oil “humiliating,” even as it pushes the economy toward a 1.6 percent expansion in 2010 after a forecast 8.5 percent drop this year.

Almost 9 percentage points of the 10.4 percent plunge in output in the first half was because of “a massive inventory adjustment,” says Martin Gilman, former head of the Moscow office of the International Monetary Fund, and OAO Gazprom, the world’s No. 1 gas producer, accounted for most of the slump. European consumers tapped stored gas as the delayed effect of dearer oil drove up gas prices earlier this year.

Worst Performance

Russia’s economy is the worst performer among the so-called BRIC group of emerging markets that include Brazil, China and India.

The ruble strengthened 1.3 percent to 30.0150 against the dollar at 1:01 p.m. in Moscow. The currency gained 1.2 percent versus the euro to 44.2867. Russian stocks pared gains after the report, up 0.3 percent to 1308.97 at 1.02 p.m., after earlier rising as much as 0.9 percent.

Gazprom said last month that sales volumes to Europe and other export markets fell 24 percent in the first half from a year earlier as the economic slowdown eroded demand. Since July, Gazprom’s exports were higher than in the same periods of 2007 and 2008, the company said.

‘Major Driver’

“A major driver of Russia’s sharp contraction was the inventory correction and we are seeing the end of that,” said Vladimir Osakovsky, an economist at UniCredit Bank in Moscow, before the data was released payday loans. “Any improvement in Russia’s overall economic performance is linked to this process.”

The price of Urals crude oil has rebounded 70 percent this year as global demand for commodities recovered. Energy, including oil and gas, accounts for about 70 percent of Russia’s export earnings.

The recovery may be slow. Nine interest rate cuts since April failed to spur bank lending and rekindle growth in industry and a slump in manufacturing deepened last month after export demand sagged.

VTB Capital’s Purchasing Managers’ Index fell to 49.1 from 49.6 in October. The index, which is based on a survey of 300 purchasing executives, in September rose above 50, signaling the industry’s first expansion in 14 months.

Output Contraction

A contraction in industrial output accelerated in October to 11.2 percent from 9.5 in the previous month, the statistics service said last month.

“Industry hasn’t returned to stable growth,” Finance Minister Alexei Kudrin said this week. “There are still problems.”

Lenders’ corporate loan books fell 0.5 percent in October, after declining 0.7 percent in September, according to data published on the central bank’s Web site Dec. 3. Lending to consumers dropped 0.7 percent for a ninth consecutive monthly decline.

The contraction this year may have been as much as 3 percentage points deeper without anti-crisis spending, Deputy Economy Minister Andrei Klepach said on Dec. 10. The economy will probably shrink between 8.5 percent and 8.7 percent this year, he said.

As of Nov. 1, the government had spent 784 billion rubles ($26 billion) of 1.14 trillion rubles earmarked for stimulus measures, Deputy Finance Minister Tatiana Nesterenko said the same day.

Next year “there will be growth, but it will be growth after a big fall,” Kudrin said. The recovery will be complicated as governments retract stimulus programs and raise interest rates. “In the next two to three years this will be a factor that increases the cost of money and slows growth.”

Source

Sales at U.S. retailers probably rose in November for the third time in the past four months, a sign consumer spending will sustain growth into 2010, economists said before a government report this week.

Purchases climbed 0.7 percent after a 1.4 percent gain the prior month, according to the median estimate of 62 economists surveyed by Bloomberg News before Commerce Department figures on Dec. 11. Other reports may show the trade gap widened in October and consumers grew more confident this month.

Gains in sales show American households have survived the worst employment slump in the postwar era and are poised to join in the emerging expansion. Treasury Secretary Timothy Geithner said the labor market is moving closer to a period of job creation instead of losses, which may give the economy an additional lift early next year.

“Job gains are in sight,” said Ken Mayland, president ClearView Economics LLC in Pepper Pike, Ohio. “With employment increases, we can expect people to begin buying some more homes, cars, appliances, etc.”

A Labor Department report last week showed the economy lost 11,000 jobs in November, the smallest decline since the start of the recession in December 2007. The jobless rate unexpectedly fell to 10 percent from 10.2 percent.

The report showed “progress, but not good enough,” Geithner said in a Dec. 4 interview for Bloomberg Television’s “Political Capital With Al Hunt.”

Geithner on Economy

“The key test is when you see companies across the country starting to create jobs and add to payrolls,” Geithner said. “We’re getting closer to that point — that’s the important thing. The economy is now growing and growth seems to be gradually strengthening.”

Auto sales are improving even after the federal “cash- for-clunkers” incentives ended in late August.

General Motors Co., Toyota Motor Corp., Ford Motor Co. and Chrysler Group LLC all posted November sales that beat analysts’ estimates. The seasonally adjusted sales rate was 10.9 million vehicles, up from 10.45 million in October, according to industry figures released last week.

Excluding automobiles, retail sales probably rose 0.4 percent after a 0.2 percent increase the prior month, according to the Bloomberg survey. A gain would be the fourth straight.

Holiday shoppers are turning out. Sales on Black Friday and the weekend after Thanksgiving advanced 0.5 percent as discounts on electronics and toys drew budget-conscious crowds, according to the National Retail Federation.

Electronics Sales

Best Buy Co., the biggest electronics chain, had bigger early-morning crowds than last year, said Brian Dunn, chief executive officer and president of the Eden Prairie, Minnesota- based company. He said shoppers would continue to see discounted pricing into the year-end holidays.

“You’re going to see great values throughout the holiday selling season,” he said in an interview with Bloomberg Television on Nov. 27.

TJX Corporation Inc. reported sales up 15 percent in the four weeks ended Nov. 28 from a year earlier. The operator of T.J. Maxx and other low-priced apparel retailers forecasts strong sales through the end of the year.

“We are confident in our momentum,” said Carol Meyrowitz, chief executive officer of TJX, said in a statement on Dec. 3.

Gaining Confidence

The Reuters/University of Michigan preliminary index of consumer sentiment for December probably rose to 69 from 67.4 a month earlier, according to the Bloomberg survey before the Dec. 11 release.

The economy grew at a 2.8 percent annual pace in the third quarter following four quarters of contraction that marked the deepest recession since the 1930s. Economists surveyed by Bloomberg early last month forecast growth will accelerate to 3 percent in the current quarter.

The recovery is spurring demand for imports. That probably caused the trade deficit to widen to $37 billion in October from $36.5 billion in September, according to the median estimate of economists surveyed by Bloomberg before the Dec. 10 report from the Commerce Department. The collapse in trade earlier this year brought the deficit down to a near-decade low of $26.4 billion in May.

Source

Faced with shrinking market shares, fragmenting audiences, disappearing brick-and-mortar recorded music retailers and a continued double-digit decline in compact disc sales, Canadian independent record labels that exclusively sold and distributed CDs until a few years ago are acting as agents and booking concert tours for their artists.

They have formed in-house management companies, and bought ticket agencies and digital download retailers.

"The entire music industry is changing, and nobody knows what it’s changing into, so everyone’s trying to create new strategies that work for them," says Lloyd Nishimura, president of Toronto’s Outside Music, whose company has expanded into artist management with a roster that includes sibling songwriters Matthew and Jill Barber and the Hylozoists.

"I don’t think it’s that much of a stretch if you’re a management company to have in-house booking or other music-related businesses. Everybody will be looking at a whole bunch of opportunities in the future."

"It’s a necessity," adds Geoff Kulawick, president of Burlington-based Linus Entertainment, True North Records and The Children’s Group.

Kulawick, who launched a booking agency under the True North banner in 2008 to promote such developing label artists as Lynn Miles, Catherine MacLellan and Madison Violet, says a hands-on approach to careers is essential these days.

"We can’t be operating in the music space and sell only one aspect of it," he says. "We’re moving from being a record company to becoming a music experience company, and anything that’s connected to the music experience that we can monetize, we want to be there."

Kulawick says his company isn’t about to go toe-to-toe with established agents, or infringe on their territory.

"It’s becoming more difficult for developing artists to find booking agents and concert promoters who are willing to take a risk on booking them, so that’s where we’re stepping in and actively performing that booking/management role for our artists," he says.

Nishimura, whose company has expanded to include a stake in digital retailer Zunior.com and handle the business affairs of musicians, says the Internet has fragmented audiences to a point where marketing can be a challenge.

"With the Internet, people have exposure to every single artist around the world all at the same time, so it is just difficult to stand out from the crowd," says Nishimura.

At the same, Nishimura says the potential opportunities through the still-evolving digital market are limitless: "There are so many different ways that digital revenue comes in – you get money from streams and single download sales, album download sales – and even though you don’t have physical distribution around the world, you can still get digital revenue from around the world."

These companies aren’t alone. In July, publicly traded Somerset Entertainment Income Fund, a Toronto-headquartered specialty music label formed on the backbone of the late Dan Gibson’s groundbreaking nature recordings, purchased digital music retailer Puretracks for $3 million.

Earlier this month Toronto’s MapleCore Ltd., home to the e-commerce site MapleMusic.com, the record labels Maple Music and Open Road Recordings and distribution arm Fontana North, announced the purchase of TicketBreak Corp., a full-service ticketing company.

The good news is these strategies seem to be working. Three of the four companies have experienced cumulative double-digit growth since 2005, with MapleCore president and CEO Grant Dexter claiming a "100 per cent revenue increase" for his umbrella of companies.

"We’ve added staff and it’s been a great run over the last three or four years," says Dexter, whose MapleMusic.com website sells merchandise, CDs and digital downloads for more than 800 Canadian artists.

Dexter says his company’s acquisition of TicketBreak allows him to offer touring artists such as Jann Arden "VIP packages for their core fan base, including meet-and-greets, exclusive seats and merchandise.

"Technology has allowed, for the first time, for that one-to-one relationship between fan and artist to be transactional," Dexter explains.

Andy Burgess, CEO of the Somerset Entertainment Income Fund – now in the midst of a supported $30.7 million takeover bid by Fluid Music – says strategic music-related deals like his company’s purchase of Puretracks will continue.

"The traditional business model is so very challenging that we have to be really innovative as business managers and figure out how to draw a profit," says Burgess, whose company employs more than 180 people around the world.

"If you have a relationship with an artist, it makes sense to see if you can then run their touring business. If we’ve got a relationship with a retailer, it makes sense to see if we can run their digital music gift cards, or put together music download promotions for their supplier.

"In a very difficult industry, it makes sense to leverage your core strength in different directions, and the smart guys will be able to do (so) in a way where there are endless possibilities."

Source

Plummeting advertising sales have severely wounded media companies, but CBS is scoring big with the broadcast of this season’s Super Bowl XLIV.

Months away from the biggest football game of the year, CBS (CBS, Fortune 500) is already nearing a 90% sellout for advertising spots during the game. The network expects to close enough deals to hit that mark before Thanksgiving, said John Bogusz, CBS’s vice president of sports sales and marketing.

CBS hasn’t yet topped the $3 million rival NBC charged for each 30-second spot during the 2009 telecast, according to reports.

So far, CBS’s sales have hovered in the range of $2.5 and $3 million per spot. But with more than two months to go before kickoff, CBS still has time to reel in the big buyers.

Networks typically sell 62 commercials of 30 seconds each for the game. That math means CBS only has a half-dozen or so spots left to sell for the game that airs Feb. 7, 2010. Anheauser-Busch (BUD), Coca-Cola (KO, Fortune 500), PepsiCo (PEP, Fortune 500), and several movie studios and car companies have reportedly already purchased their ad packages for the 2010 game.

For last season’s big match, NBC didn’t reach the 90% benchmark for sales until January, just a month ahead of the telecast.

Bogusz said the pace of sales is ahead of that for the 2007 Super Bowl telecast, the last time CBS televised the event. A majority of the remaining slots are in the second half of the game, he said.

Super Bowl sales can pay off big for the broadcasters that air the game. In 2007, CBS said some advertisers paid more than $2.6 million for their 30-second commercials. The network’s advertising revenue jumped 9% in the first quarter that year thanks to its telecasts of the Super Bowl and the semifinals of the NCAA men’s basketball tournament. 

Source

Sprint is betting the farm on the WiMax standard. The U.S. mobile phone carrier’s customers are melting away. Yet it has scrimped on cellular network capex to double down on wireless broadband. Putting another $1 billion into cash-burning partner Clearwire, while a rival technology is catching up, amounts to a binary bet for shareholders.

Sprint’s problem is simple — its customers are dissatisfied. It lost another 801,000 of its most profitable customers in the third quarter. More than four million have fled to other networks over the past year. Sprint’s bigger rivals scent blood and have been aggressively courting customers with advertising campaigns and handset offers.

Yet Sprint (S, Fortune 500) has slashed capital expenditure to an unsustainable level. Its current budget is equal to 7% of sales, which is less than half what rival AT&T (T, Fortune 500) spends — and AT&T’s revenues are more than 15 times as large as Sprint’s, so it has the advantage of scale as well.

Instead, Sprint is increasing its bet on Clearwire (CLWR), the company rolling out WiMax. This wireless technology could make broadband ubiquitous, even in rural areas. But it will face stiff competition. While WiMax is the only "4G" technology currently deployed, a rival technology backed by Sprint’s deeper-pocketed rivals will be available soon payday advance. This standard, called LTE, may be widely used within two years.

Moreover, Clearwire may need even more cash. It thinks it will burn up to $1.3 billion in the second half of the year. The $4 billion it has in the bank after the current round won’t last long at that rate. If it needs more, Sprint would have to pony up to keep majority control. That might be difficult, as it is already heavily indebted — its market capitalization is $9 billion, while its net debt was almost $16 billion at the end of last quarter.

Sprint’s stock has really become a highly leveraged bet on WiMax. The payoff for success would be enormous. But WiMax has fewer than half a million customers. The odds of it becoming a widespread standard are low if it can’t quickly build on its temporary advantage before a more powerful competitor gets going. If WiMax doesn’t catch on, it would exacerbate Sprint’s troubles.

Handset makers don’t like designing equipment for second-tier standards, and customers tend to flock to operators with the best phones. At worst, Sprint could even be forced to adopt LTE, which would be a heavy burden for the already indebted company. The clock is ticking on Sprint. 

Source