Lori and I skied Watterville Valley last Sunday and had a blast! I have not been to Watterville Valley in the last three years so it was nice to ski it again. We only had time to take a day trip so Watterville was the perfect place to go. We spent most of the day skiing off the Sunnyside Triple. We liked Gema, True Grit, and especially Bobby's Run. The video below has some shots of us skiing the bumps on Bobby's Run. My run looks a little rough due to the size of the moguls, but we still had lots of fun!
Tuesday, February 27, 2007
Saturday, February 24, 2007
Lost Your Camera in a Boston Taxi?
If you lost your camera in a Boston taxi yesterday and these are your pictures then I have your camera. To get it back, please leave me a comment below with your email address. I will ask you to describe some of the other pictures that were on the camera so that I can be sure that it is yours and then send it back to you.Tuesday, February 20, 2007
Sirius & XM Merger Analysis
The big business story of the week is that Sirius and XM proposed a merger of equals that will create a single satellite radio broadcaster in the US. In order for this deal to proceed the companies will need the FCC and Justice department to approve the merger. I am sure that we will see quite a bit of debate about whether the government should approve this merger. So I thought that I would take a look at some of the issues that we need to consider in this proposed merger.
Market Definition
Is the merger of Sirius and XM going to create a monopoly? Well that depends on the definition of the merged firm's market. Should we define it narrowly and deem the firm a monopoly or define it broadly and see the firm competing in a vigorous market?
Narrow Market Definition
Satellite Radio - currently only two firms
Broad Market Definition
AM & FM Radio
HD Radio
MP3 & CD
Stakeholder Perspectives
Both Sirius, XM, and a potential merged firm impact quite a few other stakeholders including customers, content providers, and competitors. Any potential merger will likely affect these stakeholders so we need to consider the impacts on each.
Customer Perspective
Prospect of monopoly rents
Mitigated by potential competition in broad market definition
Single company allows consumers to access all satellite radio content - MLB, NFL, College Football, Howard Stern...
Reduced confusion
Potentially lower commitment innovation
Content Providers
Single company allows for only one possible satellite radio partner
Each content provider has a monopoly on their content - so merged firm will gain only slightly more negotiating leverage.
Likely a push
AM/FM Broadcasters
Would prefer two weaker satellite radio competitors to a single stronger competitor
Government Role
Some people may argue that the government should not have a role in approving the merger of these two firms. However the reality is that neither one of these firms or any other radio or television broadcasters would exist with out the government regulating the broadcast spectrum to keep others from broadcasting in their spectrum. With that realization and with the realization that both of these firms understood that the government wanted two satellite radio competitors I think that it is perfectly reasonable for the FCC and the Justice department to review this merger. The reviewers should pay particular attention to how customers will be impacted by assessing the potential of the merged firms to raise the monthly costs to monopoly rents. Ultimately this gets back to the original question of how to define the market - either narrowly or broadly. If it appears that the firms would dramatically raise prices after a merger the deal should not go through, but if it appears that all the other competing technologies will force them to keep prices low then the government should approve the merger.
Market Definition
Is the merger of Sirius and XM going to create a monopoly? Well that depends on the definition of the merged firm's market. Should we define it narrowly and deem the firm a monopoly or define it broadly and see the firm competing in a vigorous market?
Narrow Market Definition
Satellite Radio - currently only two firms
Broad Market Definition
AM & FM Radio
HD Radio
MP3 & CD
Stakeholder Perspectives
Both Sirius, XM, and a potential merged firm impact quite a few other stakeholders including customers, content providers, and competitors. Any potential merger will likely affect these stakeholders so we need to consider the impacts on each.
Customer Perspective
Prospect of monopoly rents
Mitigated by potential competition in broad market definition
Single company allows consumers to access all satellite radio content - MLB, NFL, College Football, Howard Stern...
Reduced confusion
Potentially lower commitment innovation
Content Providers
Single company allows for only one possible satellite radio partner
Each content provider has a monopoly on their content - so merged firm will gain only slightly more negotiating leverage.
Likely a push
AM/FM Broadcasters
Would prefer two weaker satellite radio competitors to a single stronger competitor
Government Role
Some people may argue that the government should not have a role in approving the merger of these two firms. However the reality is that neither one of these firms or any other radio or television broadcasters would exist with out the government regulating the broadcast spectrum to keep others from broadcasting in their spectrum. With that realization and with the realization that both of these firms understood that the government wanted two satellite radio competitors I think that it is perfectly reasonable for the FCC and the Justice department to review this merger. The reviewers should pay particular attention to how customers will be impacted by assessing the potential of the merged firms to raise the monthly costs to monopoly rents. Ultimately this gets back to the original question of how to define the market - either narrowly or broadly. If it appears that the firms would dramatically raise prices after a merger the deal should not go through, but if it appears that all the other competing technologies will force them to keep prices low then the government should approve the merger.
Friday, February 16, 2007
Warbeats
Ever wonder how music producers create the interesting beats featured in popular music? Well now nfxbeats has created a series of tutorials on YouTube illustrating how they actually do it. My favorite is this his remake of In Da Club. Enjoy
Tuesday, February 13, 2007
History the Minimum Wage
Minimum wage laws remain controversial in our current politics. Many people would like raise them and many others would like to abolish them. Even economists are split. In an attempt to better understand the current issues I investigated the history of the minimum wage. The following includes a couple of interesting items that I found.
The US Department of Labor has a chart covering the history of the Federal minimum wage. The chart shows the periodic increases in the minimum wage, but the thing that I found most interesting was the notes at the bottom of the page. It turns out that the Federal minimum wage, which began in 1938 originally only covered "employees engaged in interstate commerce or in the production of goods for interstate commerce." I assume that this had something to do with the US Constitution. Of course then in 1961 the minimum wage started applying to "employees in large retail and service enterprises as well as to local transit, construction, and gasoline service station employees." Then in 1966, the minimum wage started applying to "State and local government employees of hospitals, nursing homes, and schools, and to laundries, dry cleaners, and large hotels, motels, restaurants, and farms." So eventually everyone was covered even if they only had a peripheral relationship to interstate commerce.
Also interesting was that prior to 1937, the U.S. Supreme Court had consistently struck down minimum wage laws on the grounds that the government could not interfere with private contracts. Of course this position changed when FDR proposed a court packing plan in an attempt to stop the Supreme Court from blocking his New Deal legislation. This shift on the Supreme Court ultimately enabled minimum wage legislation for the purpose of benefiting workers in a time of economic turmoil.
But where did the idea of a minimum wage originate. The idea of a minimum wage originated with Progressives at the turn of the 19th century. The interesting idea that I found in this research paper is that the Progressives did not intend for the minimum wage to benefit all workers but to keep undesirable workers out of the labor force. Specifically this included women, children, and minorities whom the advocates of a minimum wage believed took jobs from deserving workers. Their thinking was that by setting a minimum wage higher than the wage a business was willing pay for women, children, or minorities the law would lead to lower employment for these groups and higher employment for white men. Tellingly, all of the early minimum wage laws that the Supreme Court struck down were specifically women's minimum wage laws. So over the past century the politics of the minimum wage has shifted from attempts to keep people out of the labor force to attempts to benefit the labor force.
The US Department of Labor has a chart covering the history of the Federal minimum wage. The chart shows the periodic increases in the minimum wage, but the thing that I found most interesting was the notes at the bottom of the page. It turns out that the Federal minimum wage, which began in 1938 originally only covered "employees engaged in interstate commerce or in the production of goods for interstate commerce." I assume that this had something to do with the US Constitution. Of course then in 1961 the minimum wage started applying to "employees in large retail and service enterprises as well as to local transit, construction, and gasoline service station employees." Then in 1966, the minimum wage started applying to "State and local government employees of hospitals, nursing homes, and schools, and to laundries, dry cleaners, and large hotels, motels, restaurants, and farms." So eventually everyone was covered even if they only had a peripheral relationship to interstate commerce.
Also interesting was that prior to 1937, the U.S. Supreme Court had consistently struck down minimum wage laws on the grounds that the government could not interfere with private contracts. Of course this position changed when FDR proposed a court packing plan in an attempt to stop the Supreme Court from blocking his New Deal legislation. This shift on the Supreme Court ultimately enabled minimum wage legislation for the purpose of benefiting workers in a time of economic turmoil.
But where did the idea of a minimum wage originate. The idea of a minimum wage originated with Progressives at the turn of the 19th century. The interesting idea that I found in this research paper is that the Progressives did not intend for the minimum wage to benefit all workers but to keep undesirable workers out of the labor force. Specifically this included women, children, and minorities whom the advocates of a minimum wage believed took jobs from deserving workers. Their thinking was that by setting a minimum wage higher than the wage a business was willing pay for women, children, or minorities the law would lead to lower employment for these groups and higher employment for white men. Tellingly, all of the early minimum wage laws that the Supreme Court struck down were specifically women's minimum wage laws. So over the past century the politics of the minimum wage has shifted from attempts to keep people out of the labor force to attempts to benefit the labor force.
Save Boston!
Check out this hilarious game, which is an hilarious take on the recent controversy over an Aqua Teen Hunger Force promotion.Update: I shamelessly ripped off the picture from this guy.
Update 2: I added the YouTube below, which is a pretty funny commentary on the event.
Friday, February 09, 2007
Interview with Lee Tavis
Read this great interview with Prof. Lee Tavis, who was one of my finance professors at the University of Notre Dame. The interview covers Prof. Tavis' wide ranging interests and provides a great window into his thinking on how corporations can help improve society. Prof. Tavis emphasises the transfer of values from successful corporations to indigenous populations and encourages western companies to engage with the local populations as his story about General Motors in South Africa describes.
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