Explaining Southern California's economy

American Public Media's new streaming partner: Why Slacker Radio?

The International Consumer Electronics Show Highlights Latest Gadgets

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This morning, American Public Media — Southern California Public Radio and KPCC's parent organization — announced at the Consumer Electronics Show (CES) in Las Vegas that it will partner with Slacker Radio to stream APM content through Slacker's services.

Of course, Slacker isn't the only Internet music streaming service out there. So why did APM choose it over, say, Pandora or Spotify?

Simple: Slacker enables programming. So do some other streaming services, but not in a way that would allow the APM and its programs, like the popular "Marketplace," to stand out. APM will be in good company: ABC News and ESPN are also Slacker partners.

At PCMag.com, Jeffrey L. Wilson provides a quick summary of what the various streaming radio and music services are all about. He says that Slacker is for "Tweakers" — that is allows users to customize their listening experience. Pandora, by contrast, permits much less involved modification; the whole idea is that you sit back and let the Pandora algorithm choose your music for you.


Can 'pollinators' save companies from stagnation?

Surfing the Web at Starbucks

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Patrick Hanlon runs a branding agency called THINKTOPIA. We've traded thoughts in the past, and I think we may be soon trading some new ones regarding this post at Forbes. Patrick explains why "pollinators" — gypsy-esque workers who move from company to company, like bees, bringing tidbits of insight, innovation, and business culture with them — can drive corporate innovation.

Big companies, even ones with a background in innovation, are up against a classic problem. As they grow larger and more dominant (think: Google), they tend to tap out their ability to grow rapidly (think: Microsoft). They then fall into defensive actions to preserve what some investors call the "moat" around their competitive advantages. As the company focuses less on innovation and more on preservation, it can get "disrupted" by a more nimble rival or an upstart.


Hostess bankruptcy: It's the trouble with Twinkies

Hostess Twinkies Celebrate 75th Anniversary

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Four of the Twinkies that (ahem) drove Hostess Brands into a second bankruptcy since 2004.

Don't worry: the Twinkie supply won't dry up. Hostess Brands, however, is filing for Chapter 11 bankruptcy for the second time in the past decade. Last time around, it set a record for languishing in restructuring. And even though a bankruptcy double-dip is never a good thing, Hostess' investors have enough confidence in the ongoing strength of the Twinkie-and-Wonder Bread market to produce additional financing.

Hostess, like a lot of companies that have been around for a while, has both a debt and a legacy cost/union problem. Total debt is "more than $860 million," according the Wall Street Journal. The pension plan is underfunded by $2 billion and fairly complicated, to boot, covering far more than employees than actually work for Hostess. And the union contracts...well, Chapter 11 will provide the excuse to renegotiate them.


Wall Street pays bankers more to keep them from being unemployed

Mercer 3619

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Andrew Ross Sorkin has a good column today on banker pay, which has declined as the fortunes of big Wall Street investment banks have turned south. However, he insists that we look to a more opaque metric: the compensation-to-revenue ratio.

For publicly traded banks, increased profits from rising revenue is supposed to be returned to shareholders. But as Sorkin notes, there's a battle between shareholders and employees for the pieces of that pie. When the revenue-to-compensation ratio is out of whack — well above 50 percent, for example — it indicates that employees are winning. 

This becomes especially apparent when the economy is in a bearish mood and revenues are lower. The conventional wisdom says that this is no time to cut compensation at banks. Sorkin expresses some mild skepticism at this notion:


California's budget: Hostage to the rich

California Budget

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Gov. Jerry Brown discusses the cuts he has already made to help reduce the state's budget deficit from nearly $20 billion last year to a gap of about $9.2 billion as he unveiled his proposed $92.5 billion 2012-13 state budget at a Capitol news conference in Sacramento, Calif., Thursday, Jan. 5, 2012. California faces a smaller budget deficit in the coming fiscal year but will require nearly $5 billion in cuts to public education if voters reject Brown's plan to raise taxes in the fall.(AP Photo/Rich Pedroncelli)

The Los Angeles Times' Anthony York reports on a...disagreement between the Legislative Analyst's Office and California Gov. Jerry Brown. Brown's budget plan, released prematurely last week, calls for tax increases that would generate almost $7 billion in additional revenue each year, bringing the state deficit down to zero in five years — the time frame for the tax hikes.

Not so fast, says the LAO: it will only be $4.8 billion in 2012-13, then $5.5 billion thereafter.

Here's York:

The wide discrepancy is the latest split over numbers between the administration and the Legislative Analyst's Office. Last November, the Legislative Analyst's Office released a revised estimate for the state’s current budget picture. Less than a month later, Brown’s department of finance came back with estimates that were $1.5 billion higher than the Legislative Analyst's Office numbers.

In its analysis Monday, the Legislative Analyst's Office said that predicting just how much Brown’s tax measure would bring in is difficult because it is dependent on income taxes from upper earners. That money varies wildly from year to year.