Television networks, once dominant providers of home entertainment and news, are fast becoming superfluous as viewership shrinks and consumers flee to content available on the Internet. The seismic shift spells doom for the unwieldy networks: ABC, CBS, NBC and FOX.
It wasn't too long ago there were only three over-the-air network channels, black-and-white sets and one television perched in the living room. Over the last five decades, there has been a sea change yet the network dinosaurs have failed to keep pace with fluctuating viewing habits.
A look at viewership data offers a stunning rebuke for network television. In 1950 at the dawn of the television age, the top rated weekly program Texaco Star Theater attracted 61.6 percent of television households, according to data compiled by media tracking firm Nielsen.
By comparison, Nielsen's top-rated network weekly program last year was American Idol, which captured a measly 8.1 percent of television households. That translates into about 23.9 million people in a nation of more than 300 million. Outside the top ten programs, viewership falls off the cliff to less than 4 million people for most network shows.
Where have all those viewers gone? They are scampering to the Internet. A recent Forrester Research study found that American households have increased their time online by 121 percent since 2005. By comparison, the time spent watching television has remained virtually unchanged.
For the first time, consumers are devoting as much time to online activities as they are to watching TV, according to the study. Viewers are turning to the Internet to watch video on their computer, smartphone, tablet or game player. Many Internet videos are churned out by amateurs, rather than Hollywood studios.
Nielsen data underscores the burgeoning demand for non-traditional content. For example, an estimated 111.1 million people watch videos each month on YouTube. Some of the featured entertainers on YouTube attract millions of viewers each day, dwarfing network television audiences.
Other players in this new arena include Hulu, which streams video of TV shows, movies and other content, along with lesser-known VEVO, which offers music videos. Hulu draws 13.1 million viewers each month, while VEVO, despite its lower profile, pulls in 34.5 million people.
Movie provider Netflix grabs 7.4 million viewers monthly, while 29.8 million people watch videos on social networking site Facebook. No wonder network television is losing all those eyeballs.
While its programming has been licensed from the networks, Hulu shook up the industry this year with its own original fare. The popular online service aired two dramas and has indicated it plans to create more shows. YouTube recently announced it will bankroll 100 new channels this year with an investment of $100 million.
Rumors are swirling about Apple's plans to acquire content. The technology leader may be planning a new venture into television that would include original programing. If Apple enters the fray, it will surely change the landscape forever.
While the networks offer standard entertainment supported by paid commercials, the content available elsewhere often is delivered with no or little advertising and some providers supply video on a subscription only basis, such as VEVO and Netflix.
The network TV business model was built on paid commercial advertising. However, more viewers are recording shows for later viewing and skipping the ads. More than 62 percent of viewers report having watched a TV program either via their DVR, internet or on-demand channel. That's a 61 percent increase over the previous year, according to TV Pulse Survey.
As this data suggests, consumers are abandoning "live" entertainment for delayed viewing. They want their entertainment on their time schedule, not dictated by a network broadcaster. Increasingly, consumers aren't passive viewers either; instead they prefer to play an active role in programming.
That trend will drive viewers to abandon the networks in droves in search of an interactive experience. These videophiles will want to be more involved with shows and the cast, while sharing their experience live with others online. In the future, viewers will contribute ideas for shows and plots.
Video fare will follow users from the big screen (television) to the little screen (smartphone), streaming seamlessly from one device to another. Content will likely reside on a cloud, a computer server accessible via the Internet or other high-speed connections.
None of this bodes well for the hide-bound networks.
Those three-letter dinosaurs (ABC, CBS, NBC, FOX) won't become extinct overnight. But their size, content and reach will slowly ebb. Then they will vanish from the earth just like those reptiles from the Mesozoic Era.
Sunday, April 29, 2012
Sunday, April 22, 2012
ObamaCare: Job Destroyer and Innovation Killer
While President Obama was lecturing the Supreme Court on constitutional law, his drones in the federal bureaucracy were sharpening rules aimed at collecting billions of dollars in new taxes on lifesaving medical devices used by millions of Americans.
In what appears to be a deliberate attempt to skirt public scrutiny, the Internal Revenue Service quietly issued cumbersome procedures for implementing the taxes, estimated to haul in $20 billion to help pay for Obama Care. The tariffs are slated to go into effect next year.
As a result, taxes will be slapped on everything from stents to artificial hips and knees to defibrillators. Although the assessment will be levied on the medical device industry, ultimately consumers will end up paying the tab through higher medical and insurance costs.
Ahead of the tax implementation, medical companies are laying off employees, slicing investment in research and development, and reigning in plans for new manufacturing facilities. The result will be fewer jobs, less innovation and more government paperwork, according to industry sources.
"In a nutshell, it (the tax) would raise costs and lead to significant job losses," reported Boston Scientific, one of the nation's premier medical device manufacturers. "It does not address the quality of care but the political scoreboard of savings."
The tax, a 2.3 percent levy, may look small, but when coupled with other fees paid by the medical device industry, the impact will be huge on a business segment with wafer-thin profit margins.
"This creates tremendous pressure for us to move manufacturing to Europe and other parts of the world," warned Stephen Ferguson, chairman of Cook Medical, a large manufacturer of a whole range of diagnostic and surgical devices.
Stryker, a Kalamazoo, Michigan-based company which manufactures artificial hips and knees, is one of the firms that already has announced plans to slash its global workforce by 1,000. Other companies, like Massachusetts' Zoll Medical Corporation, envision a bleak future for the industry.
"Running our company close to break even would not be a sustainable position for us," Zoll said in a statement. "So we will be forced to look at alternatives." Those alternatives include outsourcing manufacturing to other countries.
In addition, the tax will undermine the incentive for entrepreneurs to create new lifesaving devices. Their start-up expenses are bound to be higher to reflect the added cost of doing business, thus discouraging many from manufacturing and marketing their inventions.
None of the gloom and doom talk has fazed the tax-happy Obama Administration. The president's Treasury Secretary Tim Geithner shooed industry concerns like a cow swatting flies with its tail. He argued the taxes and the law's expanded coverage will create more demand for the devices.
Really? What planet does Geithner live on? Higher prices for devices will stifle demand from hospitals and medical professionals. Obama Care's onerous provisions also will make certain that happens because health care coverage for procedures using the devices will be reduced.
That leaves the medical device industry in a classic Catch-22 situation. Their costs will rise, but government provided health care will pay less for procedures involving the devices.
If you are the beneficiary of a medical device, let your voice be heard. Write and call your congressman or congresswoman. Even if you don't currently have a pacemaker or other medical appliance, when you need one, you better pray it will be available to save your life.
The best outcome is that the president's tongue-lashing will harden the Supreme Court's resolve to do the right thing and throw Obama Care in the trash bin where it belongs.
In what appears to be a deliberate attempt to skirt public scrutiny, the Internal Revenue Service quietly issued cumbersome procedures for implementing the taxes, estimated to haul in $20 billion to help pay for Obama Care. The tariffs are slated to go into effect next year.
As a result, taxes will be slapped on everything from stents to artificial hips and knees to defibrillators. Although the assessment will be levied on the medical device industry, ultimately consumers will end up paying the tab through higher medical and insurance costs.
Ahead of the tax implementation, medical companies are laying off employees, slicing investment in research and development, and reigning in plans for new manufacturing facilities. The result will be fewer jobs, less innovation and more government paperwork, according to industry sources.
"In a nutshell, it (the tax) would raise costs and lead to significant job losses," reported Boston Scientific, one of the nation's premier medical device manufacturers. "It does not address the quality of care but the political scoreboard of savings."
The tax, a 2.3 percent levy, may look small, but when coupled with other fees paid by the medical device industry, the impact will be huge on a business segment with wafer-thin profit margins.
"This creates tremendous pressure for us to move manufacturing to Europe and other parts of the world," warned Stephen Ferguson, chairman of Cook Medical, a large manufacturer of a whole range of diagnostic and surgical devices.
Stryker, a Kalamazoo, Michigan-based company which manufactures artificial hips and knees, is one of the firms that already has announced plans to slash its global workforce by 1,000. Other companies, like Massachusetts' Zoll Medical Corporation, envision a bleak future for the industry.
"Running our company close to break even would not be a sustainable position for us," Zoll said in a statement. "So we will be forced to look at alternatives." Those alternatives include outsourcing manufacturing to other countries.
In addition, the tax will undermine the incentive for entrepreneurs to create new lifesaving devices. Their start-up expenses are bound to be higher to reflect the added cost of doing business, thus discouraging many from manufacturing and marketing their inventions.
None of the gloom and doom talk has fazed the tax-happy Obama Administration. The president's Treasury Secretary Tim Geithner shooed industry concerns like a cow swatting flies with its tail. He argued the taxes and the law's expanded coverage will create more demand for the devices.
Really? What planet does Geithner live on? Higher prices for devices will stifle demand from hospitals and medical professionals. Obama Care's onerous provisions also will make certain that happens because health care coverage for procedures using the devices will be reduced.
That leaves the medical device industry in a classic Catch-22 situation. Their costs will rise, but government provided health care will pay less for procedures involving the devices.
If you are the beneficiary of a medical device, let your voice be heard. Write and call your congressman or congresswoman. Even if you don't currently have a pacemaker or other medical appliance, when you need one, you better pray it will be available to save your life.
The best outcome is that the president's tongue-lashing will harden the Supreme Court's resolve to do the right thing and throw Obama Care in the trash bin where it belongs.
Sunday, April 15, 2012
New Climate Data Guaranteed To Make Al Gore Hot
Global warming zealots are steamed about new climate data that shows the earth's temperatures have not risen in the last 15 years, despite dire predictions of a steady warming. Since the end of last year, world temperatures actually have fallen by more than a half-a-degree.
Study results have fueled near hysteria in some scientific and political circles because the research raises fresh skepticism over prophesies about imminent global warming and stokes the fierce debate over the accuracy of climate forecast models.
Even more troubling for some, the research comes from two sources often cited by the climate calamity crowd. The new study was released jointly by the United Kingdom's national weather service (Met Office) and the University of East Anglia Climate Research Unit (CRU), the same UK outfit that produced the original models used to predict catastrophic temperature hikes.
Established in 1971, the university's CRU has attracted funding from many private and public sources, including the U.S. Department of Energy. Temperature and climate measurements developed by the group have been relied upon as definitive proof of man-made climate change.
In the face of its own observations, the East Anglia bunch wouldn't budge on its previous ominous predictions, insisting its climate forecast models remain valid. Many in the scientific community are unconvinced in light of the new evidence.
"If temperatures continue to stay flat or start to cool again, the divergence between the models and recorded data will eventually become so great the whole scientific community will question current theories," wrote Duke University's Dr. Nicola Scafetta.
Benny Peiser, director of the Global Warming Policy Foundation, went even further in his condemnation of the East Anglia climate modeling. "If we don't see convincing evidence of global warming by 2015, it will start to become clear (whether) the models are bunk."
Indeed, emerging data suggests the earth may be entering a cooling phase. Analysis by climate specialists at NASA and the University of Arizona indicates the energy output from the sun may have peaked and the next cycle could be weaker than earlier projections. If this proves to be the case, the earth may experience a mini-ice age.
"World temperatures may end up a lot cooler than now for 50 years or more," offers Henrik Svensmark, director of the Center for Sun-Climate Research at Denmark's National Space Institute.
In spite of the chorus from nihilists, global warming scaremongers remain unrepentant. A spokesman for the Met Office claimed a "reduction of solar activity to levels not seen in hundreds of years would be insufficient to offset the dominant influence of greenhouse gases" on climate change.
Technology has also exposed flaws in East Anglia's data. For instance, observations from weather balloons and satellites since the late 1950's show no atmospheric warming since 1958, according to Robert M. Carter, an Australian environmental scientist. Many like him believe this data is more accurate because ground-based thermometers are skewed by heat emitted in urban areas.
With each new revelation, the mainstream media has concealed the data under a barrage of self-serving dribble from politicians and global warming parasites with vested interest in maintaining the charade. Since East Anglia's data was released, Al Gore and his legion of climate change theologians have been oddly silent.
Perhaps, they are beginning to recognize the truth about our marvelous planet. The earth's climate has been in a constant state of change since its birth. There has never been a so-called steady state when applied to the planet's climate.
The sooner Al Gore and his disciples recognize that fact, the better off the world will be in preparing for the inevitable changes in climate that will naturally occur over the next millennium.
Study results have fueled near hysteria in some scientific and political circles because the research raises fresh skepticism over prophesies about imminent global warming and stokes the fierce debate over the accuracy of climate forecast models.
Even more troubling for some, the research comes from two sources often cited by the climate calamity crowd. The new study was released jointly by the United Kingdom's national weather service (Met Office) and the University of East Anglia Climate Research Unit (CRU), the same UK outfit that produced the original models used to predict catastrophic temperature hikes.
Established in 1971, the university's CRU has attracted funding from many private and public sources, including the U.S. Department of Energy. Temperature and climate measurements developed by the group have been relied upon as definitive proof of man-made climate change.
In the face of its own observations, the East Anglia bunch wouldn't budge on its previous ominous predictions, insisting its climate forecast models remain valid. Many in the scientific community are unconvinced in light of the new evidence.
"If temperatures continue to stay flat or start to cool again, the divergence between the models and recorded data will eventually become so great the whole scientific community will question current theories," wrote Duke University's Dr. Nicola Scafetta.
Benny Peiser, director of the Global Warming Policy Foundation, went even further in his condemnation of the East Anglia climate modeling. "If we don't see convincing evidence of global warming by 2015, it will start to become clear (whether) the models are bunk."
Indeed, emerging data suggests the earth may be entering a cooling phase. Analysis by climate specialists at NASA and the University of Arizona indicates the energy output from the sun may have peaked and the next cycle could be weaker than earlier projections. If this proves to be the case, the earth may experience a mini-ice age.
"World temperatures may end up a lot cooler than now for 50 years or more," offers Henrik Svensmark, director of the Center for Sun-Climate Research at Denmark's National Space Institute.
In spite of the chorus from nihilists, global warming scaremongers remain unrepentant. A spokesman for the Met Office claimed a "reduction of solar activity to levels not seen in hundreds of years would be insufficient to offset the dominant influence of greenhouse gases" on climate change.
Technology has also exposed flaws in East Anglia's data. For instance, observations from weather balloons and satellites since the late 1950's show no atmospheric warming since 1958, according to Robert M. Carter, an Australian environmental scientist. Many like him believe this data is more accurate because ground-based thermometers are skewed by heat emitted in urban areas.
With each new revelation, the mainstream media has concealed the data under a barrage of self-serving dribble from politicians and global warming parasites with vested interest in maintaining the charade. Since East Anglia's data was released, Al Gore and his legion of climate change theologians have been oddly silent.
Perhaps, they are beginning to recognize the truth about our marvelous planet. The earth's climate has been in a constant state of change since its birth. There has never been a so-called steady state when applied to the planet's climate.
The sooner Al Gore and his disciples recognize that fact, the better off the world will be in preparing for the inevitable changes in climate that will naturally occur over the next millennium.
Sunday, April 1, 2012
Social Insecurity: Coming Up Empty At Retirement
For the first time ever, Social Security is running a cash flow deficit, doling out more money to retirees than it confiscates in payroll taxes from the nation's 160 million workers. As the ratio between workers and retirees shrinks, the financial chasm becomes wider over the next two decades until the program plummets into insolvency.
That dire forecast is written on page nine of the 2011 annual report of the Board of Trustees of the Federal Old Age and Survivors Insurance Trust Funds. The trustees estimated that the fund will be exhausted by 2036. By law, retiree benefits will have to be pared by approximately 24 percent.
Despite the gloomy outlook, Congress and President Obama are content to twiddle their thumbs. In fact, the two branches of government have conspired to exacerbate the crisis. They recently hammered out a deal to extend a two percentage point reduction in Social Security payroll taxes.
The agreement, coupled with an extension of unemployment benefits, will add $100 billion to the federal deficit and will deepen the financial sink hole within the Society Security trust fund. That portends a financial train wreck of epic proportions that will extinguish the retirement hopes of future generations.
Despite repeated government assurances to the contrary, the Social Security trust fund has no cash. It consists only of government bonds that will have to be repaid by taxpayers. Congress has annually raided the fund, depleting its surplus to pay for other government obligations.
As more people file for benefits, unfunded liabilities are mushrooming. Benefits to be paid to current retirees are underfunded to the tune of $21 trillion. These future payments have already been earned by the nation's 51 million Social Security pensioners, yet there are no real economic assets in the fund that can be used to pay these benefits.
Many Americans still cling to the notion that the payroll taxes they send into the program during their working years guarantees retirement income. The unfortunate truth is that the government is under no obligation to pay any benefits. The entire system rests on the continued benevolence of politicians, who can change Social Security eligibility rules and benefits at their whim.
That cannot be comforting news for today's workers.
Even worse, the choices are limited for salvaging Social Security. Either taxes have to be raised by double-digits or benefits must be significantly reduced or the government has to borrow massive amounts of money to cover the ballooning liability. There are no magic bullets.
However, there is an alternative solution to provide retirement income for today's workers. Let them invest their own money in a personal retirement account.
A worker who had invested in S&P 500 stocks over the past 40 years would have earned an average yearly return of 6.85 percent. Corporate bonds would have generated a 3.46 percent yield over the same period. Even safe, low-earning government bonds would have delivered a 2.44 percent yearly gain.
Social Security's rate-of-return for the same period is a paltry 2.2 percent. There would be zero return had it not been for cost-of-living increases over the years.
Those figures are contained in a policy analysis published by the Cato Institute on February 13. The numbers probably come as a surprise given the volatility of the stock market over the past several years. Conventional wisdom declares that stocks are too risky for a retirement nest egg.
In spite of the evidence, individual retirement accounts have no chance to see the light of day under President Obama and the Democrat controlled Senate. Former House Speaker Nancy Pelosi once bellowed that if seniors' had owned personal retirement accounts they would have been wiped out by the recent market plunge.
The evidence doesn't support her chicken-little squawk. But since when does Congress or the president put any stock in facts or data?
Both branches of government continue to bury their collective heads in the sand, hoping the Social Security crisis magically goes poof. Neither have the political will to make the difficult decisions, especially in an election year.
Meanwhile, the clock is ticking toward a financial Armageddon that will leave today's workers empty-handed at retirement. If politicians ignore the pleas of workers and pensioners to fix Social Security, no one in Washington can pretend ignornace.
Unless, of course, they want to plead to being both politically deaf and dumb.
That dire forecast is written on page nine of the 2011 annual report of the Board of Trustees of the Federal Old Age and Survivors Insurance Trust Funds. The trustees estimated that the fund will be exhausted by 2036. By law, retiree benefits will have to be pared by approximately 24 percent.
Despite the gloomy outlook, Congress and President Obama are content to twiddle their thumbs. In fact, the two branches of government have conspired to exacerbate the crisis. They recently hammered out a deal to extend a two percentage point reduction in Social Security payroll taxes.
The agreement, coupled with an extension of unemployment benefits, will add $100 billion to the federal deficit and will deepen the financial sink hole within the Society Security trust fund. That portends a financial train wreck of epic proportions that will extinguish the retirement hopes of future generations.
Despite repeated government assurances to the contrary, the Social Security trust fund has no cash. It consists only of government bonds that will have to be repaid by taxpayers. Congress has annually raided the fund, depleting its surplus to pay for other government obligations.
As more people file for benefits, unfunded liabilities are mushrooming. Benefits to be paid to current retirees are underfunded to the tune of $21 trillion. These future payments have already been earned by the nation's 51 million Social Security pensioners, yet there are no real economic assets in the fund that can be used to pay these benefits.
Many Americans still cling to the notion that the payroll taxes they send into the program during their working years guarantees retirement income. The unfortunate truth is that the government is under no obligation to pay any benefits. The entire system rests on the continued benevolence of politicians, who can change Social Security eligibility rules and benefits at their whim.
That cannot be comforting news for today's workers.
Even worse, the choices are limited for salvaging Social Security. Either taxes have to be raised by double-digits or benefits must be significantly reduced or the government has to borrow massive amounts of money to cover the ballooning liability. There are no magic bullets.
However, there is an alternative solution to provide retirement income for today's workers. Let them invest their own money in a personal retirement account.
A worker who had invested in S&P 500 stocks over the past 40 years would have earned an average yearly return of 6.85 percent. Corporate bonds would have generated a 3.46 percent yield over the same period. Even safe, low-earning government bonds would have delivered a 2.44 percent yearly gain.
Social Security's rate-of-return for the same period is a paltry 2.2 percent. There would be zero return had it not been for cost-of-living increases over the years.
Those figures are contained in a policy analysis published by the Cato Institute on February 13. The numbers probably come as a surprise given the volatility of the stock market over the past several years. Conventional wisdom declares that stocks are too risky for a retirement nest egg.
In spite of the evidence, individual retirement accounts have no chance to see the light of day under President Obama and the Democrat controlled Senate. Former House Speaker Nancy Pelosi once bellowed that if seniors' had owned personal retirement accounts they would have been wiped out by the recent market plunge.
The evidence doesn't support her chicken-little squawk. But since when does Congress or the president put any stock in facts or data?
Both branches of government continue to bury their collective heads in the sand, hoping the Social Security crisis magically goes poof. Neither have the political will to make the difficult decisions, especially in an election year.
Meanwhile, the clock is ticking toward a financial Armageddon that will leave today's workers empty-handed at retirement. If politicians ignore the pleas of workers and pensioners to fix Social Security, no one in Washington can pretend ignornace.
Unless, of course, they want to plead to being both politically deaf and dumb.
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