Explaining Southern California's economy

Hewlett-Packard tablet reload still won't move the needle

Tom Pennington/Getty Images

Former California gubernatorial candidate Meg Whitman was chosen to take over at Hewlett-Packard.

As you may recall, Hewlett-Packard distinguished itself in the tablet market by bringing out the TouchPad at $500 and then having to slash the price to $99 (well, BestBuy slashed the price) a little over the month later. Debacle! And this was with a reasonably nice device that ran WebOS, the superb operating system that HP picked up when it took over Palm.

Now Meg Whitman — she of the ill-fated bid for governor of California, now HP's CEO — has said that HP will introduce another tablet "before the end of this year" (Bloomberg) and that it will run Microsoft's Windows 8 OS...eventually.

Oh, also, there will be Intel chips.

It will be an HP Wintel tablet.

Hooray! What a wonderful plan! But... 

As I've written before, there is no tablet market — there's an iPad market. And the only company that's been able to take a bite out of Apple's dominance is Amazon, which with its Kindle Fire isn't selling a tablet but a tricked-out Kindle (a Kindroid) to use as leverage to get more people to purchase Amazon content.

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This is where Apple pays Chinese workers $2 an hour to make iPhones

 

It's actually starting to build: the Apple backlash. A decade ago, the company was almost bankrupt. Today, it has a market cap of $481 billion, almost $100 billion cash in the bank, and a share price that some analyst think could go to $1000 by 2015, if not sooner.

Those numbers come from Apple's astonishing growth — around 40 percent since January of last year — and its equally astonishing operating profit margins: 30-plus percent. But what enables that growth and those margins is two things: cheap Chinese labor; and customers who are willing to pay a premium.

The video above is from a February 22 broadcast of ABC's "Nightline." The news program got an inside look at Foxconn, the "iFactory" in China where workers are paid less than $2 an hour for a 12-hour shift. More than a dozen of these workers have committed suicide, although it's unclear whether the working conditions drove them to it or whether Foxconn's facilities employ so many Chinese that suicides are going to be inevitable, as a percentage of the employed population.

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Gas prices: It's about the efficiency, people!

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Corey Bridwell/KPCC

Gas prices at a Chevron station in Pasadena, CA.

As the price of oil pushes higher and gas prices ascend nationwide to levels we're already seeing in California, there's been unleashed a fury of discussion about "Why, oh why?" this is happening. Speculation on oil futures has been blamed (Hedge funds!), as has the threat of an Israeli strike on Iran's nuclear sites or a temporary shutdown of the Strait of Hormuz by Iran itself.

Neither makes much sense to me, although there may be elements of the true story in each. Speculators can drive prices up just to bet on them falling, so you have to factor in a certain amount of volatility there. As for Iran's naval capabilities...well, the Strait could be closed for maybe a few days, possibly even a week. But it wouldn't take long for the U.S. Navy to sink pretty much everything Iran has that floats.

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You ain't nothing but a network in the sky

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Hannes Magerstaedt/Getty Images

Fill it up with your Facebook friends.

Good story from the New York Times for anyone who considers him or herself a road warrior and dislikes losing potentially productive travel time to a random conversation with a seatmate: airlines are beginning to allow passengers to use their social-networking profiles to choose seat companions. Here's a salient section:

Relative latecomers to the social media party, airlines are quickly becoming sophisticated users of online networks, not only as marketing tools, but as a low-cost way to learn more about their customers and their preferences. With Facebook alone claiming nearly 500 million daily active users — more than 60 times the eight million people who fly each day — KLM and others are betting that many of them would be willing to share their profiles in exchange, say, for a chance to meet someone with a common interest or who might be going to the same event.

The idea is catching on. Last year, Malaysia Airlines introduced MHBuddy, an application that allows users who book and check in via the carrier’s Facebook page to see whether any of their “friends” will be on the same flight or in their destination city at the same time. The platform, which claims 3,000 monthly active users, also enables existing friends to select seats together.

And airlines are not the only ones betting on the concept.

Planely, a Danish start-up, allows registered users who submit their itineraries to view the Facebook and LinkedIn profiles of others who will be on flights with them. Since it began in late 2010, Planely has connected more than 1,500 travelers, according to its chief executive, Nick Martin.

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Paul Krugman: The Playboy Interview that's not safe for Republicans

In this three photo combo, Professor of

PAUL J. RICHARDS/AFP/Getty Images

Paul Krugman supports Occupy Wall Street, but he has some ideas about its agenda.

I'm going to seriously date myself here, but last year when writing about the Occupy Movement and its intellectual allies, I chose the above photo of New York Times columnist and Nobel laureate Paul Krugman specifically because it reminded me of the famous Playboy Interview and its equally famous triptych photo layout for interviews of famous people. I mean, this was where Jimmy Carter confessed that he had lusted after women in his heart.

The Playboy Interview with Krugman is a real treat, and not just because he confesses that he lusts after some members of Arcade Fire in his heart. Here's a taste:

I’ve gotten some grief for my remark that if it were announced that we faced a threat from space aliens and needed to build up to defend ourselves, we’d have full employment in a year and a half. But that’s true. Why couldn’t we do that to repair our sewer systems and put an extra tunnel under the Hudson instead of to fight imaginary space aliens? Everybody in the world except us is doing a lot of investment in infrastructure and education. This is the country of the Erie Canal and the Interstate Highway System. The Erie Canal was a huge public infrastructure project financed with no private or public-private partnership. Can you imagine doing that in 21st century America? We really have slid backward for the past 200 years from the kinds of things we used to understand needed to be done now and then. And all of that because we are shackled to the wrong ideas.

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