Top 10 Stories / Sept. 11-15
1. FTC Challenges Hollywood Violence: The Federal Trade Commission issued a scathing report condemning the marketing to teenagers of violent films, video games and music. Using internal files from Hollywood studios, music companies and game makers, the report showed a pattern of entertainment marketing practices that targeted teenagers with inappropriate materials, adding that Hollywood often ignored the guidelines of its own rating system in pitching products to teens. Democratic presidential nominee Al Gore and vice presidential candidate Joseph I. Lieberman suggested that Hollywood could face regulations if it doesn’t make changes. Hollywood executives complained they were being subjected to a political witch hunt.
(James Bates)
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2. Oil, Gas Prices Stay High: Despite a promise by the Organization of Petroleum Exporting Countries to send 800,000 more barrels of oil to the market on Oct. 1, oil prices remained high and California’s average gas price set a record of $1.85 a gallon. OPEC’s president warned of a looming worldwide energy crisis if oil-consuming nations don’t produce and refine more petroleum. President Clinton said he doesn’t think high oil prices will push the U.S. into recession.
(Nancy Rivera Brooks)
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3. Firestone Admits Tire Defects: Under severe questioning before congressional committees, Bridgestone/Firestone Inc. officials admitted for the first time to producing bad tires but could not yet pinpoint exactly what caused its tires for Ford Motor Co.’s Explorer sport-utility vehicle to fail at high rates. Congressional leaders vowed to strengthen penalties against the auto industry for knowingly withholding safety information from the public. Meanwhile, state attorneys general and federal prosecutors moved closer to launching criminal investigations against both Ford and Bridgestone/Firestone.
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4. Malone Rumored as Next AT&T; Chief: Following a stock slump and a rocky corporate restructuring at AT&T; Corp., rumors surfaced Wednesday that C. Michael Armstrong was out as chairman after a three-year reign. The buzz on Wall Street was that he would be replaced by media mogul John Malone, the board member and largest shareholder of AT&T; who has been telegraphing his discontent with the progress of the company’s transformation for months. Although there appears to be no truth to the rumors, tensions are mounting at the telecommunications giant.
(Sallie Hofmeister)
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5. Movement in SAG Talks: Representatives of the advertising industry and actors met for the first time since July to try to resolve a bitter 20-week strike estimated to have cost Southern California about $100 million in lost production. The sides will meet again Monday. Pressure is mounting on both sides to end the strike by members of the Screen Actors Guild and the American Federation of Television and Radio Artists.
(James Bates)
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6. Chase to Buy J.P. Morgan: In yet another blockbuster deal that’s transforming the major players on Wall Street, Chase Manhattan Corp. said Wednesday that it will buy J.P. Morgan & Co. for about $35 billion. Like the three other such deals in the last two months, Chase is seeking to achieve critical mass in the rapidly consolidating global financial-services industry. Analysts speculate that several other Wall Street players, including Lehman Bros. Holdings and Bear Stearns Cos., could be swallowed up in the next few months.
(Walter Hamilton)
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7. U.S. Censures Options Exchanges: The four largest U.S. options exchanges Monday reached a settlement of federal allegations that they had restrained competition for years by refusing to trade options already listed by rival exchanges. The Securities and Exchange Commission censured the Chicago Board Options Exchange, American Stock Exchange, Pacific Exchange and Philadelphia Stock Exchange for “anti-competitive activities” that authorities said resulted in higher prices for investors. The SEC ordered the exchanges to spend $77 million collectively over the next two years on improved market surveillance and enforcement.
(Thomas S. Mulligan)
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8. Supermarket Fees Protested: Fruit and vegetable growers say supermarkets are now charging them the same upfront fees typically reserved for food manufacturers introducing new or unfamiliar items such as a new flavor of ketchup or type of potato chip. Grower groups, regulators and others gathered at a Senate committee hearing last week to discuss how these fees, known as slotting fees, are moving into the produce aisle, raising expenses for many strapped small farmers. Supermarket industry officials say that with so many new fruit and vegetable items competing for scarce space, many chains feel they need to charge these fees to cover the costs and risks associated with slower-selling items.
(Melinda Fulmer)
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9. Home Prices Hit Record:
Home prices in Los Angeles and Orange counties reached record highs last week, closing a strong summer season, as analysts expect prices to move even higher in coming months. The median home price in Los Angeles rose by more than 7% in August to $205,000--meaning half the homes cost more and half cost less. That surpassed the previous high of $203,000 in May 1989 and matched in June of this year. In Orange County, prices surged nearly 14% from a year earlier to $274,000, the highest in Southern California, according to DataQuick Information Systems, a La Jolla research firm.
(Daryl Strickland)
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10. Hewlett-Packard to Buy Unit of PricewaterhouseCoopers: Hewlett-Packard Co. agreed to pay about $17.5 billion in cash and stock for the consulting business of Pricewater-[ houseCoopers as merger talks focused on how the consultancy’s partners will divide the proceeds, people familiar with the matter said. A final agreement between the world’s No. 2 computer maker and the consulting unit of the largest U.S. accounting firm is expected to take several weeks, the sources said.
(Bloomberg News)
Offspring to Spring Next Album on Net
The popular rock bank Offspring plans to post its next album on the Internet a month before the CD goes on sale. The punk band believes its giveaway will fuel sales of the album when it hits stores in November. But the plan has spooked Sony, the record label that distributes Offspring’s music. Sony said posting the album on the Internet would be a contractual violation. The band’s members are undeterred and said they will move ahead with their marketing plans.
