With promotions, discounts and doorbusters already well under way on Thanksgiving Day itself, many big-box retailers are making Black Friday stretch longer than ever. The Lede is checking out the mood of American consumers in occasional vignettes Thursday and Friday as the economically critical holiday shopping season kicks off.
The New Old Age Blog: Home Health Care Help by the Hour
Label: HealthHere is a bright idea that ought to spread: You call your home care agency and say you will need your mother’s aide for the normal two hours on Monday and Wednesday, but for just half an hour (to drive her to a doctor’s office) on Tuesday, then 90 minutes on Thursday. And the agency says, “Sure.”
It sounds logical to hire someone to help — with bathing, dressing, errands, meal preparation, medication reminders – for only as many hours as an older adult needs assistance. But it is actually unusual for companies to offer such flexibility.
The majority of agencies require a four-hour minimum. Having to spend $80 — the national average cost for home care is $21 an hour — if you only need $40 worth of help is a big barrier for families trying to keep their elderly relatives living at home longer. A few agencies allow you to hire for fewer than four hours, but at higher rates.
But Mission Healthcare in San Diego, Calif., a three-year-old agency that began with Medicare-certified skilled home nursing and hospice care, expanded to general home care this summer and decided that clients should be able to specify how much help they want – in 15-minute increments — and will pay for.
“We’ll come for as long as they need us to,” said Mark Kimsey, one of Mission’s four directors. “In one hour, a well-trained caregiver can get the client bathed and dressed, prepare three meals and have them organized for the day.” (I have to think that is a speedy caregiver with a not-too-frail client, but still … )
Can Mission, which charges $19 to $20 an hour, actually make money this way? Though overall the agency serves 1,100 clients, its fledgling home care business is still small: 30 aides caring for just 60 clients. The aides can get benefits if they work enough hours, a bonus for them and for consumers (better employees, lower turnover), but an additional cost for the company.
The directors say they are profitable already, and that the approach will succeed because more people will like the flexibility and potential savings, and sign up. It is also true, let’s acknowledge, that a person who can get by with an hour or two a day for now may well need more help eventually, a boost for Mission’s bottom line.
Competitors are no doubt watching to see if this works. I’m curious, too, to see if the policy catches on. “Consumers can change the marketplace if they want to,” Mr. Kimsey said. It would be nice to think that is true.
Paula Span is the author of “When the Time Comes: Families With Aging Parents Share Their Struggles and Solutions.”
The New Old Age Blog: Home Health Care Help by the Hour
Label: LifestyleHere is a bright idea that ought to spread: You call your home care agency and say you will need your mother’s aide for the normal two hours on Monday and Wednesday, but for just half an hour (to drive her to a doctor’s office) on Tuesday, then 90 minutes on Thursday. And the agency says, “Sure.”
It sounds logical to hire someone to help — with bathing, dressing, errands, meal preparation, medication reminders – for only as many hours as an older adult needs assistance. But it is actually unusual for companies to offer such flexibility.
The majority of agencies require a four-hour minimum. Having to spend $80 — the national average cost for home care is $21 an hour — if you only need $40 worth of help is a big barrier for families trying to keep their elderly relatives living at home longer. A few agencies allow you to hire for fewer than four hours, but at higher rates.
But Mission Healthcare in San Diego, Calif., a three-year-old agency that began with Medicare-certified skilled home nursing and hospice care, expanded to general home care this summer and decided that clients should be able to specify how much help they want – in 15-minute increments — and will pay for.
“We’ll come for as long as they need us to,” said Mark Kimsey, one of Mission’s four directors. “In one hour, a well-trained caregiver can get the client bathed and dressed, prepare three meals and have them organized for the day.” (I have to think that is a speedy caregiver with a not-too-frail client, but still … )
Can Mission, which charges $19 to $20 an hour, actually make money this way? Though overall the agency serves 1,100 clients, its fledgling home care business is still small: 30 aides caring for just 60 clients. The aides can get benefits if they work enough hours, a bonus for them and for consumers (better employees, lower turnover), but an additional cost for the company.
The directors say they are profitable already, and that the approach will succeed because more people will like the flexibility and potential savings, and sign up. It is also true, let’s acknowledge, that a person who can get by with an hour or two a day for now may well need more help eventually, a boost for Mission’s bottom line.
Competitors are no doubt watching to see if this works. I’m curious, too, to see if the policy catches on. “Consumers can change the marketplace if they want to,” Mr. Kimsey said. It would be nice to think that is true.
Paula Span is the author of “When the Time Comes: Families With Aging Parents Share Their Struggles and Solutions.”
The Shrewd Shopper Carries a Smartphone
Label: Technology
Tim Gruber for The New York Times
From left, Tara Niebeling, Sarah Schmidt, Bridget Jewell and Erin Vande Steeg are members of the social media team at the Mall of America in Bloomington, Minn.
Retailers are trying to lure shoppers away from the Internet, where they have increasingly been shopping to avoid Black Friday madness, and back to the stores. The bait is technological tools that will make shopping on the busiest day of the year a little more sane — and give shoppers an edge over their competition.
Those with smartphones in hand will get better planning tools, prices and parking spots. Walmart has a map that shows shoppers exactly where the top Black Friday specials can be found. A Mall of America Twitter feed gives advice on traffic and gifts, and the Macy’s app sends special deals for every five minutes a shopper stays in a store.
“The crazy mad rush to camp out and the crazy mad rush to hit the doorbusters have really made people think, ‘I’m just going to stay home on Black Friday,’ ” said Carey Rossi, editor in chief of ConsumerSearch.com, a review site. “This is going to invite some people back and say, ‘You know what? It doesn’t have to be that crazy.’ ”
Part of the retailers’ strategy is to slap back at online stores like Amazon.com, which last year used apps to pick off shoppers as they browsed in physical stores. But the stores are also recognizing that shopping on the Friday after Thanksgiving need not require an overnight wait in line, a helmet and elbow pads. A smartphone gives shoppers enough of an edge.
“This takes away that frantic Black Friday anxiety,” said Lawrence Fong, co-founder of BuyVia, an app that sends people price alerts and promotions. “While there’s a sport to it, life’s a little too short.”
Denise Fouts, 45, who works repairing fire and water damage in Chandler, Ariz., was already using apps, including Shopkick, Target’s app and one called Black Friday, before Thanksgiving to prepare for Black Friday. “There still are going to be the crowds, but at least I already know ahead of time what I’m going specifically for,” Ms. Fouts said.
Last week, Macy’s released an update to its app with about 300 Black Friday specials and their location. In the Herald Square store, for instance, the $49.99 cashmere sweater specials will be in the Broadway side of the fifth-floor women’s department.
“With the speed that people are shopping with on Black Friday, they need to be really efficient about how they’re spending their time,” said Jennifer Kasper, group vice president for digital media at Macy’s.
When shoppers keep the app open, Macy’s will start sending special deals to the phone every five minutes. The deals are not advertised elsewhere.
Walmart has had an app for several years, but recently introduced an in-store mode, which shows things like the current circular or food tastings when a shopper is near a certain location. Twelve percent of Walmart’s mobile revenue now comes from when a person is inside a store.
For Black Friday, the app will have a map of each store, with the precise location of the top sale items — so planners can determine the best way to run. “The blitz items are not where you think they would be, because for traffic reasons, maybe the hot game console is in the lawn and garden center,” said Gibu Thomas, senior vice president for mobile and digital for Walmart Global eCommerce.
Target is also testing a way-finding feature on its app at stores that include some in Seattle, Chicago and Los Angeles. If a shopper types in an item, the app will give its location.
Other app makers are betting that shoppers want apps that pull in information from many stores.
RedLaser, an eBay app, lets shoppers use their phones to compare prices and recently started using location data to give shoppers personalized promotions when they walk into stores, including items not on store shelves at Best Buy, for instance. RetailMeNot, which offers e-commerce coupons, now has offline coupons that will pop up on users’ cellphones when they step near 500 malls on Black Friday.
“Consumers are not going to download 40 different apps for 40 different stores,” said Cyriac Roeding, co-founder of Shopkick, a location-based app that gives shoppers points, redeemable for perks, when they walk into stores or scan certain items.
For Black Friday, Shopkick is publishing what it calls a little black book with the top doorbusters. Shoppers will earn extra points and rewards for shopping on Black Friday.
Military Analysis: For Israel, Gaza Conflict Is Test for an Iran Confrontation
Label: World
Menahem Kahana/Agence France-Presse — Getty Images
An Israeli missile is launched from a battery. Officials said their antimissile system shot down 88 percent of all assigned targets.
WASHINGTON — The conflict that ended, for now, in a cease-fire between Hamas and Israel seemed like the latest episode in a periodic showdown. But there was a second, strategic agenda unfolding, according to American and Israeli officials: The exchange was something of a practice run for any future armed confrontation with Iran, featuring improved rockets that can reach Jerusalem and new antimissile systems to counter them.
It is Iran, of course, that most preoccupies Prime Minister Benjamin Netanyahu and President Obama. While disagreeing on tactics, both have made it clear that time is short, probably measured in months, to resolve the standoff over Iran’s nuclear program.
And one key to their war-gaming has been cutting off Iran’s ability to slip next-generation missiles into the Gaza Strip or Lebanon, where they could be launched by Iran’s surrogates, Hamas, Hezbollah and Islamic Jihad, during any crisis over sanctions or an Israeli strike on Iran’s nuclear facilities.
Michael B. Oren, the Israeli ambassador to the United States and a military historian, likened the insertion of Iranian missiles into Gaza to the Cuban missile crisis.
“In the Cuban missile crisis, the U.S. was not confronting Cuba, but rather the Soviet Union,” Mr. Oren said Wednesday, as the cease-fire was declared. “In Operation Pillar of Defense,” the name the Israel Defense Force gave the Gaza operation, “Israel was not confronting Gaza, but Iran.”
It is an imprecise analogy. What the Soviet Union was slipping into Cuba 50 years ago was a nuclear arsenal. In Gaza, the rockets and parts that came from Iran were conventional, and, as the Israelis learned, still have significant accuracy problems. But from one point of view, Israel was using the Gaza battle to learn the capabilities of Hamas and Islamic Jihad — the group that has the closest ties to Iran — as well as to disrupt those links.
Indeed, the first strike in the eight-day conflict between Hamas and Israel arguably took place nearly a month before the fighting began — in Khartoum, the capital of Sudan, as another mysterious explosion in the shadow war with Iran.
A factory said to be producing light arms blew up in spectacular fashion on Oct. 22, and within two days the Sudanese charged that it had been hit by four Israeli warplanes that easily penetrated the country’s airspace. Israelis will not talk about it. But Israeli and American officials maintain that Sudan has long been a prime transit point for smuggling Iranian Fajr rockets, the kind that Hamas launched against Tel Aviv and Jerusalem over recent days.
The missile defense campaign that ensued over Israeli territory is being described as the most intense yet in real combat anywhere — and as having the potential to change warfare in the same way that novel applications of air power in the Spanish Civil War shaped combat in the skies ever since.
Of course, a conflict with Iran, if a last-ditch effort to restart negotiations fails, would look different than what has just occurred. Just weeks before the outbreak in Gaza, the United States and European and Persian Gulf Arab allies were practicing at sea, working on clearing mines that might be dropped in shipping lanes in the Strait of Hormuz.
But in the Israeli and American contingency planning, Israel would face three tiers of threat in a conflict with Iran: the short-range missiles that have been lobbed in this campaign, medium-range rockets fielded by Hezbollah in Lebanon and long-range missiles from Iran.
The last of those three could include the Shahab-3, the missile Israeli and American intelligence believe could someday be fitted with a nuclear weapon if Iran ever succeeded in developing one and — the harder task — shrinking it to fit a warhead.
A United States Army air defense officer said that the American and Israeli militaries were “absolutely learning a lot” from this campaign that may contribute to a more effective “integration of all those tiered systems into a layered approach.”
The goal, and the challenge, is to link short-, medium- and long-range missile defense radar systems and interceptors against the different types of threats that may emerge in the next conflict.
Even so, a historic battle of missile versus missile defense has played out in the skies over Israel, with Israeli officials saying their Iron Dome system shot down 350 incoming rockets — 88 percent of all targets assigned to the missile defense interceptors. Israeli officials declined to specify the number of interceptors on hand to reload their missile-defense batteries.
Before the conflict began, Hamas was estimated to have amassed an arsenal of 10,000 to 12,000 rockets. Israeli officials say their pre-emptive strikes on Hamas rocket depots severely reduced the arsenal of missiles, both those provided by Iran and some built in Gaza on a Syrian design.
Scandal-Scarred BBC Names Opera Chief as Leader
Label: Business
LONDON — The British Broadcasting Corporation sought to overcome its worst crisis in years on Thursday by appointing a former BBC news executive who went on to head the Royal Opera House as its new director general, urging him to rebuild public trust shredded by a scandal over botched reporting of sexual abuse.
The appointee, Tony Hall, 61, will replace George Entwistle who resigned earlier this month and became the most prominent casualty of the affair.
When Lord Hall takes over in March, the BBC said, his principal task will be to restore faith and confidence in the integrity of an organization that is not only a national institution and Britain’s public broadcaster, but also a sprawling bureaucracy financed by a compulsory license fee levied on most television-set owners.
Chris Patten, head of the supervisory BBC Trust which made the appointment, said Lord Hall, a former head of news at the BBC during a 28-year career before he joined the opera 11 years ago, was “the right person to lead the BBC out of its current crisis.”
His experience in journalism would be “invaluable as the BBC looks to rebuild its reputation,” Lord Patten said. According to British news report, Lord Hall was the only candidate the BBC Trust approached about the job.
The appointment won enthusiastic approval from a wide spectrum of politicians, media commentators and current and former BBC staff members. Many noted that Lord Hall had a record of innovation that included overseeing the launch of the BBC Web site, the broadcaster’s 24-hour news channel, and Radio 5 Live, a widely popular, news-and-sport radio channel.
They pointed, too, to his record for turning around the fortunes of another prized British institution, the Royal Opera House, where he assumed control at a time of artistic and financial disarray and succeeded in stabilizing — as well as popularizing — what has long been seen as one of the world’s top opera houses.
Steve Hewlett, a former editor of “Panorama,” one of the BBC’s leading investigative programs, said Lord Hall had a reputation among BBC program-makers as “straightforward, honest, a man with no side to him” and “no pushover” in handling contentious issues.
“I think he brings to the BBC what is desperately needed, weight,” he said.
Ben Bradshaw, a former culture minister who was previously a BBC reporter, described Lord Hall as “a very good, calm operator,” “a good motivator” and decisive in stressful situations. “He’s a very safe pair of hands, and very decent, fair-minded individual,” Mr. Bradshaw said.
Lord Hall’s predecessor, Mr. Entwistle, resigned on Nov. 10 after disclosures that a flagship BBC current affairs program, “Newsnight,” had wrongly implicated a former Conservative politician in accusations of sexual abuse at a children’s home in North Wales in the 1970s and 1980s.
The error compounded earlier disclosures that the same program had canceled an investigation a year ago into accusations of sexual abuse of minors by the television host Jimmy Savile at a time when other departments at the corporation were planning Christmas tributes to Mr. Savile, who died in October 2011 at age 84.
Mr. Entwistle had been in office at the BBC for less than two months when he quit. He took over from Mark Thompson who became president and chief executive of The New York Times Company on Nov. 12.
In a statement to the BBC staff, Lord Patten said: “The past eight weeks have been very traumatic for the BBC.”
He added: “The key challenge will be re-establishing our reputation with the public.”
The scandals at “Newsnight” pushed the BBC to begin a series of internal inquiries about its culture and practices in the decades of suspected abuse by Mr. Savile and into its specific reasons for canceling the investigation into Mr. Savile last year.
Lord Patten said: “While there are still very serious questions to be answered by the ongoing inquiries, it is in the interests of license fee-payers that the BBC now starts to refocus on its main purpose — making great programs that audiences love and trust.”
Documents Show F.D.A.’s Failures in Meningitis Outbreak
Label: Health
Newly released documents add vivid detail to the emerging portrait of the Food and Drug Administration’s ineffective and halting efforts to regulate a Massachusetts company implicated in a national meningitis outbreak that has sickened nearly 500 people and killed 34.
In the documents, released on Tuesday in response to a Freedom of Information Act request, the agency would threaten to bring the full force of its authority down on the company, only to back away, citing lack of jurisdiction.
The company, the New England Compounding Center, at times cooperated with F.D.A. inspectors and promised to improve its procedures, and at other times challenged the agency’s legal authority to regulate it, refused to provide records and continued to ship a drug in defiance of the agency’s concerns.
Some of the documents were summarized last week by Congressional committees that held hearings on the meningitis outbreak. Republicans and Democrats criticized the F.D.A. for failing to act on information about unsafe practices at the company as far back as March 2002.
By law, compounding pharmacies are regulated primarily by the states, but the pharmacies have grown over the years into major suppliers of some of the country’s biggest hospitals. The F.D.A. is asking Congress for stronger, clearer authority to police them, but Republicans have said the agency already has enough power.
Records show that the agency was sometimes slow in pursuing its own inspection findings. In one case involving the labeling and marketing of drugs, the agency issued a warning letter to New England Compounding 684 days after an inspection, a delay that the company’s chief pharmacist complained was so long that some of the letter’s assertions no longer applied to its operations.
The agency said in a statement Wednesday that it “was not the timeline we strive for,” but that much of the delay was because of “our limited, unclear and contested authority in this area.” Because of litigation, it said, there was “significant internal discussion about how to regulate compounders.”
The agency first inspected the company in April 2002 after reports that two patients had become dizzy and short of breath after being injected with a steroid made by the company.
On the first day of the inspection, Barry Cadden, the chief pharmacist, was cooperative, but the next day, the agency inspectors wrote, Mr. Cadden “had a complete change in attitude & basically would not provide any additional information either by responding to questions or providing records,” adding that he challenged their legal authority to be at his pharmacy at all.
The F.D.A. was back at New England Compounding in October 2002 because of possible contamination of another of its products, methylprednisolone acetate, the same drug involved in the current meningitis outbreak.
While the F.D.A. had the right to seize an adulterated steroid, officials at the time said that action alone would not resolve the company’s poor compounding practices. In a meeting with Massachusetts regulators, F.D.A. officials left authority in the hands of the state, which “would be in a better position to gain compliance or take regulatory action,” according to a memo by an F.D.A. official summarizing the meeting.
David Elder, compliance branch director for the F.D.A.’s New England District, warned at the meeting that there was the “potential for serious public health consequences if N.E.C.C.’s compounding practices, in particular those relating to sterile products, are not improved.”
The company fought back hard, repeatedly questioning the F.D.A.’s jurisdiction. In a September 2004 inspection over concerns that the company was dispensing trypan blue, a dye used for some eye surgeries that had not been approved by the F.D.A., Mr. Cadden told the agency inspector that he had none in stock.
But in the clean room, the inspector noticed a drawer labeled “Trypan Blue,” which contained 189 vials of the medicine.
A few days later, Mr. Cadden was defiant. He told the agency that he was continuing to dispense trypan blue and that there was nothing in the law saying a compounder could not dispense unapproved products.
The conversation turned testy. “Don’t answer any more questions!” Mr. Cadden told another pharmacy executive, according to the F.D.A.’s report.
Mr. Cadden rejected many of the assertions in the warning letter that finally came in December 2006. The next correspondence from the agency did not come until almost two years later, in October 2008, saying that the agency still had “serious concerns” about the company’s practices, and that failing to correct them could result in seizure of products and an injunction against the company and its principals.
It is not known whether any corrective actions were taken. The agency did not conduct another inspection until the recent meningitis outbreak.
Documents Show F.D.A.’s Failures in Meningitis Outbreak
Label: Lifestyle
Newly released documents add vivid detail to the emerging portrait of the Food and Drug Administration’s ineffective and halting efforts to regulate a Massachusetts company implicated in a national meningitis outbreak that has sickened nearly 500 people and killed 34.
In the documents, released on Tuesday in response to a Freedom of Information Act request, the agency would threaten to bring the full force of its authority down on the company, only to back away, citing lack of jurisdiction.
The company, the New England Compounding Center, at times cooperated with F.D.A. inspectors and promised to improve its procedures, and at other times challenged the agency’s legal authority to regulate it, refused to provide records and continued to ship a drug in defiance of the agency’s concerns.
Some of the documents were summarized last week by Congressional committees that held hearings on the meningitis outbreak. Republicans and Democrats criticized the F.D.A. for failing to act on information about unsafe practices at the company as far back as March 2002.
By law, compounding pharmacies are regulated primarily by the states, but the pharmacies have grown over the years into major suppliers of some of the country’s biggest hospitals. The F.D.A. is asking Congress for stronger, clearer authority to police them, but Republicans have said the agency already has enough power.
Records show that the agency was sometimes slow in pursuing its own inspection findings. In one case involving the labeling and marketing of drugs, the agency issued a warning letter to New England Compounding 684 days after an inspection, a delay that the company’s chief pharmacist complained was so long that some of the letter’s assertions no longer applied to its operations.
The agency said in a statement Wednesday that it “was not the timeline we strive for,” but that much of the delay was because of “our limited, unclear and contested authority in this area.” Because of litigation, it said, there was “significant internal discussion about how to regulate compounders.”
The agency first inspected the company in April 2002 after reports that two patients had become dizzy and short of breath after being injected with a steroid made by the company.
On the first day of the inspection, Barry Cadden, the chief pharmacist, was cooperative, but the next day, the agency inspectors wrote, Mr. Cadden “had a complete change in attitude & basically would not provide any additional information either by responding to questions or providing records,” adding that he challenged their legal authority to be at his pharmacy at all.
The F.D.A. was back at New England Compounding in October 2002 because of possible contamination of another of its products, methylprednisolone acetate, the same drug involved in the current meningitis outbreak.
While the F.D.A. had the right to seize an adulterated steroid, officials at the time said that action alone would not resolve the company’s poor compounding practices. In a meeting with Massachusetts regulators, F.D.A. officials left authority in the hands of the state, which “would be in a better position to gain compliance or take regulatory action,” according to a memo by an F.D.A. official summarizing the meeting.
David Elder, compliance branch director for the F.D.A.’s New England District, warned at the meeting that there was the “potential for serious public health consequences if N.E.C.C.’s compounding practices, in particular those relating to sterile products, are not improved.”
The company fought back hard, repeatedly questioning the F.D.A.’s jurisdiction. In a September 2004 inspection over concerns that the company was dispensing trypan blue, a dye used for some eye surgeries that had not been approved by the F.D.A., Mr. Cadden told the agency inspector that he had none in stock.
But in the clean room, the inspector noticed a drawer labeled “Trypan Blue,” which contained 189 vials of the medicine.
A few days later, Mr. Cadden was defiant. He told the agency that he was continuing to dispense trypan blue and that there was nothing in the law saying a compounder could not dispense unapproved products.
The conversation turned testy. “Don’t answer any more questions!” Mr. Cadden told another pharmacy executive, according to the F.D.A.’s report.
Mr. Cadden rejected many of the assertions in the warning letter that finally came in December 2006. The next correspondence from the agency did not come until almost two years later, in October 2008, saying that the agency still had “serious concerns” about the company’s practices, and that failing to correct them could result in seizure of products and an injunction against the company and its principals.
It is not known whether any corrective actions were taken. The agency did not conduct another inspection until the recent meningitis outbreak.
H.P.’s Misstep Shows Risk in the Push for Big Ideas
Label: Technology
When Hewlett-Packard spent roughly $10 billion on the software company Autonomy, it thought it was buying a slice of the future — investing in the hot trend of big data. But the deal turned out to be a debacle, and not only because H.P. wrote down $5 billion of the purchase.
The ill-fated marriage of the companies is a lesson for H.P. and other older technology giants as they throw billions at supposedly game-changing acquisitions, trying to gain a foothold in the future.
In that future, smartphones and tablets, connected to cloud-computing data centers, are the essential tools of work and play. Companies rent software over the air, rather than buying it with expensive maintenance contracts.
And vast streams of data are continually analyzed to find new patterns and make predictions about consumer behavior and product design. Autonomy, for instance, makes software that can analyze marketing patterns and advise a company on matters like where it should increase marketing resources.
These forces threaten older businesses, like H.P.’s traditional personal computer and data storage products. Other companies, like Oracle, Microsoft and Cisco, also face pressure. They are all trying to buy the future — and have the cash to do it.
In July, Microsoft decided to pay $1.2 billion for Yammer, which makes a Facebook-like social media product for the office. Oracle recently paid over $3.4 billion for two small cloud computing companies that provide software for human resources and sales management. Last Sunday, the computer networking giant Cisco agreed to pay $1.2 billion in cash for Meraki, a company that manages the free wireless service at Starbucks and other businesses.
There are lots more such deals, from these companies as well as I.B.M., SAP and others.
The pace of change is so fast that Google, so recently seen as an upstart and a giant killer, in 2011 paid $12.5 billion for Motorola Mobility to supercharge its Android smartphone business, which competes with Apple. Earlier this year, Facebook spent $750 million on Instagram so it wouldn’t miss the next thing in social media.
But identifying the next big thing can be difficult, said Jeffrey Sonnenfeld, a professor of management at Yale University. Likely as not, he said, deals like the one for Autonomy have “maybe a 40 percent success, 60 percent failure rate.”
He added, “The odds are against you succeeding, but the odds are also worth taking.”
The real hazard, he said, is in the way companies describe these acquisitions as “natural, inevitable victories.” They should be seen, he said, as “an investment, like in research and development.”
The pace of acquisitions hardly matches the level seen during the late ’90s Internet bubble, when Cisco paid $9.6 billion for three networking companies that former officials said yielded almost no benefit. In 2002, AOL Time Warner wrote down $54 billion in good will related to its troubled merger. Several telecommunications equipment makers and service providers also had multibillion-dollar write-downs.
But there are also notable successes.
EMC, a maker of data storage equipment, paid $625 million in 2003 for VMWare, which makes some of the critical technology in cloud computing. Today, after taking some of the company public, EMC’s stake is worth about $30 billion. VMWare recently took a gamble of its own, buying a next-generation networking company, Nicira, that had virtually no revenue, for $1.26 billion.
Microsoft, which also paid $8.5 billion for Skype in 2011, said Yammer was being integrated into SharePoint, Microsoft’s successful collaboration software, and will be included in its premium version of Office communications and productivity software at no cost. It did not say whether, or how, Yammer would be profitable on its own, however.
The real issue with Autonomy may be less its questionable sales than its core technology, said Leslie Owens, who follows data analysis software at Forrester Research.
“H.P. thought it was an entirely new platform, but Autonomy’s clients said it wasn’t as good as Google’s corporate search product,” she said.
Autonomy, which was founded 16 years ago, “was based on using powerful algorithms,” she said, but the software was not attuned “to new kinds of search signals, like what your friends are doing, what people like you are doing, what other data you might draw off on.” Over time those new methods attracted customers.
In a demonstration of the Autonomy product last month, H.P. appeared to have addressed some of those issues, but others remained. An application to help figure out what to pay for Web ads initially failed to work, then delivered results that appeared similar to those of several other search products.
“We remain 100 percent committed to Autonomy and its industry-leading technology,” H.P. said in a statement. “The company’s products are cutting-edge and provide many customers with unique solutions.”
In an interview Tuesday, Meg Whitman, the chief executive of H.P., indicated that the company also had strong hopes for its security software, most of which it got from other acquisitions.
H.P. has accused Autonomy of improperly accounting for much of its sales in the years before H.P. bought the company last year. It took a $5 billion noncash charge related to the purchase price.
Ms. Whitman gave Autonomy tepid support.
“It’s very disappointing,” she said of the write-down. “We’ve integrated the technology into a couple of places; we will integrate it into more.”
Scandal-Scarred BBC Names Opera Chief as Leader
Label: World
LONDON — The British Broadcasting Corporation sought to overcome its worst crisis in years on Thursday by appointing a former BBC news executive who went on to head the Royal Opera House as its new director general, urging him to rebuild public trust shredded by a scandal over botched reporting of sexual abuse.
The appointee, Tony Hall, 61, will replace George Entwistle who resigned earlier this month and became the most prominent casualty of the affair.
When Lord Hall takes over in March, the BBC said, his principal task will be to restore faith and confidence in the integrity of an organization that is not only a national institution and Britain’s public broadcaster, but also a sprawling bureaucracy financed by a compulsory license fee levied on most television-set owners.
Chris Patten, head of the supervisory BBC Trust which made the appointment, said Lord Hall, a former head of news at the BBC during a 28-year career before he joined the opera 11 years ago, was “the right person to lead the BBC out of its current crisis.”
His experience in journalism would be “invaluable as the BBC looks to rebuild its reputation,” Lord Patten said. According to British news report, Lord Hall was the only candidate the BBC Trust approached about the job.
The appointment won enthusiastic approval from a wide spectrum of politicians, media commentators and current and former BBC staff members. Many noted that Lord Hall had a record of innovation that included overseeing the launch of the BBC Web site, the broadcaster’s 24-hour news channel, and Radio 5 Live, a widely popular, news-and-sport radio channel.
They pointed, too, to his record for turning around the fortunes of another prized British institution, the Royal Opera House, where he assumed control at a time of artistic and financial disarray and succeeded in stabilizing — as well as popularizing — what has long been seen as one of the world’s top opera houses.
Steve Hewlett, a former editor of “Panorama,” one of the BBC’s leading investigative programs, said Lord Hall had a reputation among BBC program-makers as “straightforward, honest, a man with no side to him” and “no pushover” in handling contentious issues.
“I think he brings to the BBC what is desperately needed, weight,” he said.
Ben Bradshaw, a former culture minister who was previously a BBC reporter, described Lord Hall as “a very good, calm operator,” “a good motivator” and decisive in stressful situations. “He’s a very safe pair of hands, and very decent, fair-minded individual,” Mr. Bradshaw said.
Lord Hall’s predecessor, Mr. Entwistle, resigned on Nov. 10 after disclosures that a flagship BBC current affairs program, “Newsnight,” had wrongly implicated a former Conservative politician in accusations of sexual abuse at a children’s home in North Wales in the 1970s and 1980s.
The error compounded earlier disclosures that the same program had canceled an investigation a year ago into accusations of sexual abuse of minors by the television host Jimmy Savile at a time when other departments at the corporation were planning Christmas tributes to Mr. Savile, who died in October 2011 at age 84.
Mr. Entwistle had been in office at the BBC for less than two months when he quit. He took over from Mark Thompson who became president and chief executive of The New York Times Company on Nov. 12.
In a statement to the BBC staff, Lord Patten said: “The past eight weeks have been very traumatic for the BBC.”
He added: “The key challenge will be re-establishing our reputation with the public.”
The scandals at “Newsnight” pushed the BBC to begin a series of internal inquiries about its culture and practices in the decades of suspected abuse by Mr. Savile and into its specific reasons for canceling the investigation into Mr. Savile last year.
Lord Patten said: “While there are still very serious questions to be answered by the ongoing inquiries, it is in the interests of license fee-payers that the BBC now starts to refocus on its main purpose — making great programs that audiences love and trust.”
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