Corner Office: California Pizza Kitchen’s Chief, on 6 Steps to Leadership



Q. What was the first time you were somebody’s boss?


A. We’d have to go all the way back to when I was head of a bunch of umpires in Little League. We were all teenagers.


Q. Was that easy for you?


A. I’ve always taken control of situations. If you were to ask me why that is, I’m not really sure. I think it’s because I just want what I want and I feel like someone has to take the lead. I’ve always done that. I’ve been captain of every sports team I’ve ever been on. And as I’ve moved into new roles, failure has never been an option for me. It’s like I always have this person on my shoulder sort of invoking the fear factor, that I can’t fail.


Q. Where do you think that comes from?


A. Our family came to America from the Netherlands when I was young, and I had to work that much harder in any situation. I had to learn English. I had to try that much harder to be a normal kid. I went to a pretty affluent high school where the kids’ parents were doctors and lawyers, and I’m a cop’s kid. Also, I’ve always wanted to make a difference in people’s lives and in an organization.


Q. Tell me about some leadership lessons you’ve learned.


A. I worked at a poultry processing plant during college. I worked my way up, and became general manager of the plant when I was 21, overseeing 500 people. I had done pretty much every role in the operation. That was a big advantage — knowing and living what people do every day. That allows me to understand people and help them grow. I like to say that leadership is about getting people to exceed their own expectations. You can’t do that unless you understand what they do and how they do it, having lived some of it yourself.


Q. How do you feel your leadership style has evolved?


A. One thing I’ve learned over time is a lot more patience and tolerance. I used to always want things yesterday and would be very anxious about moving things along faster. But now I understand that tomorrow’s another day and that things will move along. I think more about whether something really matters and how it will make a difference, versus thinking that everything matters and everything makes a difference. It’s also much clearer to me now what the leadership qualities are that are most important to me.


Q. Can you elaborate?


A. I call them the six steps of leadership, surrounded by courage. Courage is an interesting one because any leadership role is about stepping out and having the courage to be different, because you have to be different to be a leader.


The first step is to be the very best that you can be, because you can’t lead anybody if you can’t lead yourself. So you have to be honest with yourself about your good qualities, your bad qualities and the things you need to work on.


The second thing is to dream, and dream big. What’s the world of possibilities for yourself and for your organization? You have to be able to say, “Here’s where I want to get to.” It’s not that you’ll ever necessarily get there, but if you don’t dream, you’ll never even get started.


The third is to lead with your heart first. Let people see that you’re human and that there’s a human side. Show people that you have compassion. It doesn’t mean that you don’t set expectations and standards. But if you lead with your heart, people figure out whether you’re genuine, whether you’re real.


The fourth thing can be the hardest for young leaders: to trust the people you lead. It’s about letting go, and allowing people to grow into leadership roles. At the end of the day, it’s O.K. if they make a mistake or if they fall down. Because as leaders, it’s your job to pick them back up.


The fifth is do the right thing, always. It’s easy to say. But the way I like to describe it is that if the rules say one thing, particularly as it relates to people, and you genuinely believe in that person, sometimes it takes courage to do the right thing and give that person a second chance. Because we’ve all made mistakes and somebody picked us up.


The sixth is that it’s ultimately about serving the people you lead. It’s about putting the cause before yourself, and a willingness to see it through. I developed this list over time because it’s the way I live each day. My job is to lead and to make a difference. I’m a catalyst for change, to create an environment where people can grow and prosper.


Q. Let’s shift to hiring. What questions do you ask?


A. I’ll ask unpredictable questions like, “What do you like to do for fun?” That gives you an insight into what people do with their time and what they value. But more than anything else, I hire for attitude. Skills can be learned. I’ll take attitude any day over a good skill set.


Q. How do you get insights into their attitude?


A. I’ll ask questions like: “What’s important to you? Why is it important?” Or I’ll push the résumé to the side and say: “Let’s just have a conversation about you. Tell me about yourself.” You learn a lot. If they start with where they were born, then that person is probably what I call a checklist manager who needs to be told what to do, compared to somebody who just says, “this is the type of person I am, and here’s what’s important to me.”


A lot of interviewing, quite frankly, is based on experience, gut, what makes sense, and what’s in their eyes. What are they feeling? How will they react? You know there will be tension, and there will be politics if you’re not careful. So will this person create that kind of environment or will they be part of the environment and help build a partnership? I’m a believer in partnerships, that we’re in it together. So you have to find people who will be collaborative. It doesn’t mean they can’t be strong leaders, Type A personalities. But will they act as a partner? I think you can get at that with the right kind of questions, and asking about their experiences in certain situations.


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The New Old Age: Murray Span, 1922-2012

One consequence of our elders’ extended lifespans is that we half expect them to keep chugging along forever. My father, a busy yoga practitioner and blackjack player, celebrated his 90th birthday in September in reasonably good health.

So when I had the sad task of letting people know that Murray Span died on Dec. 8, after just a few days’ illness, the primary response was disbelief. “No! I just talked to him Tuesday! He was fine!”

And he was. We’d gone out for lunch on Saturday, our usual routine, and he demolished a whole stack of blueberry pancakes.

But on Wednesday, he called to say he had bad abdominal pain and had hardly slept. The nurses at his facility were on the case; his geriatrician prescribed a clear liquid diet.

Like many in his generation, my dad tended towards stoicism. When he said, the following morning, “the pain is terrible,” that meant agony. I drove over.

His doctor shared our preference for conservative treatment. For patients at advanced ages, hospitals and emergency rooms can become perilous places. My dad had come through a July heart attack in good shape, but he had also signed a do-not-resuscitate order. He saw evidence all around him that eventually the body fails and life can become a torturous series of health crises and hospitalizations from which one never truly rebounds.

So over the next two days we tried to relieve his pain at home. He had abdominal x-rays that showed some kind of obstruction. He tried laxatives and enemas and Tylenol, to no effect. He couldn’t sleep.

On Friday, we agreed to go to the emergency room for a CT scan. Maybe, I thought, there’s a simple fix, even for a 90-year-old with diabetes and heart disease. But I carried his advance directives in my bag, because you never know.

When it is someone else’s narrative, it’s easier to see where things go off the rails, where a loving family authorizes procedures whose risks outweigh their benefits.

But when it’s your father groaning on the gurney, the conveyor belt of contemporary medicine can sweep you along, one incremental decision at a time.

All I wanted was for him to stop hurting, so it seemed reasonable to permit an IV for hydration and pain relief and a thin oxygen tube tucked beneath his nose.

Then, after Dad drank the first of two big containers of contrast liquid needed for his scan, his breathing grew phlegmy and labored. His geriatrician arrived and urged the insertion of a nasogastric tube to suck out all the liquid Dad had just downed.

His blood oxygen levels dropped, so there were soon two doctors and two nurses suctioning his throat until he gagged and fastening an oxygen mask over his nose and mouth.

At one point, I looked at my poor father, still in pain despite all the apparatus, and thought, “This is what suffering looks like.” I despaired, convinced I had failed in my most basic responsibility.

“I’m just so tired,” Dad told me, more than once. “There are too many things going wrong.”

Let me abridge this long story. The scan showed evidence of a perforation of some sort, among other abnormalities. A chest X-ray indicated pneumonia in both lungs. I spoke with Dad’s doctor, with the E.R. doc, with a friend who is a prominent geriatrician.

These are always profound decisions, and I’m sure that, given the number of unknowns, other people might have made other choices. Fortunately, I didn’t have to decide; I could ask my still-lucid father.

I leaned close to his good ear, the one with the hearing aid, and told him about the pneumonia, about the second CT scan the radiologist wanted, about antibiotics. “Or, we can stop all this and go home and call hospice,” I said.

He had seen my daughter earlier that day (and asked her about the hockey strike), and my sister and her son were en route. The important hands had been clasped, or soon would be.

He knew what hospice meant; its nurses and aides helped us care for my mother as she died. “Call hospice,” he said. We tiffed a bit about whether to have hospice care in his apartment or mine. I told his doctors we wanted comfort care only.

As in a film run backwards, the tubes came out, the oxygen mask came off. Then we settled in for a night in a hospital room while I called hospices — and a handyman to move the furniture out of my dining room, so I could install his hospital bed there.

In between, I assured my father that I was there, that we were taking care of him, that he didn’t have to worry. For the first few hours after the morphine began, finally seeming to ease his pain, he could respond, “OK.” Then, he couldn’t.

The next morning, as I awaited the hospital case manager to arrange the hospice transfer, my father stopped breathing.

We held his funeral at the South Jersey synagogue where he’d had his belated bar mitzvah at age 88, and buried him next to my mother in a small Jewish cemetery in the countryside. I’d written a fair amount about him here, so I thought readers might want to know.

We weren’t ready, if anyone ever really is, but in our sorrow, my sister and I recite this mantra: 90 good years, four bad days. That’s a ratio any of us might choose.


Paula Span is the author of “When the Time Comes: Families With Aging Parents Share Their Struggles and Solutions.”

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The New Old Age: Murray Span, 1922-2012

One consequence of our elders’ extended lifespans is that we half expect them to keep chugging along forever. My father, a busy yoga practitioner and blackjack player, celebrated his 90th birthday in September in reasonably good health.

So when I had the sad task of letting people know that Murray Span died on Dec. 8, after just a few days’ illness, the primary response was disbelief. “No! I just talked to him Tuesday! He was fine!”

And he was. We’d gone out for lunch on Saturday, our usual routine, and he demolished a whole stack of blueberry pancakes.

But on Wednesday, he called to say he had bad abdominal pain and had hardly slept. The nurses at his facility were on the case; his geriatrician prescribed a clear liquid diet.

Like many in his generation, my dad tended towards stoicism. When he said, the following morning, “the pain is terrible,” that meant agony. I drove over.

His doctor shared our preference for conservative treatment. For patients at advanced ages, hospitals and emergency rooms can become perilous places. My dad had come through a July heart attack in good shape, but he had also signed a do-not-resuscitate order. He saw evidence all around him that eventually the body fails and life can become a torturous series of health crises and hospitalizations from which one never truly rebounds.

So over the next two days we tried to relieve his pain at home. He had abdominal x-rays that showed some kind of obstruction. He tried laxatives and enemas and Tylenol, to no effect. He couldn’t sleep.

On Friday, we agreed to go to the emergency room for a CT scan. Maybe, I thought, there’s a simple fix, even for a 90-year-old with diabetes and heart disease. But I carried his advance directives in my bag, because you never know.

When it is someone else’s narrative, it’s easier to see where things go off the rails, where a loving family authorizes procedures whose risks outweigh their benefits.

But when it’s your father groaning on the gurney, the conveyor belt of contemporary medicine can sweep you along, one incremental decision at a time.

All I wanted was for him to stop hurting, so it seemed reasonable to permit an IV for hydration and pain relief and a thin oxygen tube tucked beneath his nose.

Then, after Dad drank the first of two big containers of contrast liquid needed for his scan, his breathing grew phlegmy and labored. His geriatrician arrived and urged the insertion of a nasogastric tube to suck out all the liquid Dad had just downed.

His blood oxygen levels dropped, so there were soon two doctors and two nurses suctioning his throat until he gagged and fastening an oxygen mask over his nose and mouth.

At one point, I looked at my poor father, still in pain despite all the apparatus, and thought, “This is what suffering looks like.” I despaired, convinced I had failed in my most basic responsibility.

“I’m just so tired,” Dad told me, more than once. “There are too many things going wrong.”

Let me abridge this long story. The scan showed evidence of a perforation of some sort, among other abnormalities. A chest X-ray indicated pneumonia in both lungs. I spoke with Dad’s doctor, with the E.R. doc, with a friend who is a prominent geriatrician.

These are always profound decisions, and I’m sure that, given the number of unknowns, other people might have made other choices. Fortunately, I didn’t have to decide; I could ask my still-lucid father.

I leaned close to his good ear, the one with the hearing aid, and told him about the pneumonia, about the second CT scan the radiologist wanted, about antibiotics. “Or, we can stop all this and go home and call hospice,” I said.

He had seen my daughter earlier that day (and asked her about the hockey strike), and my sister and her son were en route. The important hands had been clasped, or soon would be.

He knew what hospice meant; its nurses and aides helped us care for my mother as she died. “Call hospice,” he said. We tiffed a bit about whether to have hospice care in his apartment or mine. I told his doctors we wanted comfort care only.

As in a film run backwards, the tubes came out, the oxygen mask came off. Then we settled in for a night in a hospital room while I called hospices — and a handyman to move the furniture out of my dining room, so I could install his hospital bed there.

In between, I assured my father that I was there, that we were taking care of him, that he didn’t have to worry. For the first few hours after the morphine began, finally seeming to ease his pain, he could respond, “OK.” Then, he couldn’t.

The next morning, as I awaited the hospital case manager to arrange the hospice transfer, my father stopped breathing.

We held his funeral at the South Jersey synagogue where he’d had his belated bar mitzvah at age 88, and buried him next to my mother in a small Jewish cemetery in the countryside. I’d written a fair amount about him here, so I thought readers might want to know.

We weren’t ready, if anyone ever really is, but in our sorrow, my sister and I recite this mantra: 90 good years, four bad days. That’s a ratio any of us might choose.


Paula Span is the author of “When the Time Comes: Families With Aging Parents Share Their Struggles and Solutions.”

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App City: Taking Stock of Mobile Apps






Testing apps from week to week, it’s easy to fill my phone with a seemingly endless number of theoretically helpful programs. But how many of them do I actually use? To start off 2013, I decided to take stock of my apps, with a focus on those that relate to my life as a New Yorker. Here are my favorites, many — but not all — of which I reviewed for App City. — JOSHUA BRUSTEIN








Christoph Hitz




Embark NYC



Free for iOS and Android


For directions, the default is Google Maps. But Embark, which helps you chart a trip on the New York City subway, is the other transportation app I use regularly, largely because it can generate directions without a data connection. After all, plans can change while you are underground. Offline, you can get only directions between stations, not for street addresses, but it’s a start.




Instapaper



$3.99 for iOS; $2.99 for Android


Instapaper is not new, but the idea of setting aside articles that I see online so that I can read them when I get stuck on the subway never gets old.



Seamless



Free for iOS and Android


This tool for placing orders for delivery or takeout food through a smartphone app has drastically increased the likelihood that I will order in on any given day. I do not know if this is a good thing, but it is certainly a testament to its effectiveness.





Christoph Hitz




Immaculate Infatuation



Free for iOS


Apps for finding restaurants are plentiful, but most of them leave me feeling overwhelmed. I want someone to choose for me, and I trust the authors of this app to do that. Their taste has never led me astray — although unlike them, I have no problem with the immense popularity of brussels sprouts.







Christoph Hitz




Taskrabbit



Free for iOS


One of the neatest things to come from the current generation of tech companies are informal communities where strangers do things for one another, like share a ride or a spare room. Taskrabbit allows people to hire one another for odd jobs. These jobs can be pretty much anything, but for tasks like taking in clothing for donation, I would much rather give $20 to a neighbor with a car than figure it out myself. Getting tasks done may be easy, but becoming someone who does the tasks isn’t: there are 1,500 people on the waiting list in New York City.




Songkick



Free for iOS and Android


It analyzes the music you listen to and tells you when bands you may like are playing nearby. It has successfully kept me away from Seamless on a number of nights. But being constantly reminded of great shows has the potential to be somewhat expensive.



Nike+ Fuelband



Wristband $149, app free for iOS and Android


This setup serves as a pedometer for the digital age, keeping track of your physical activity 24 hours a day. The app’s graphical representations of miles walked and calories burned are addictive. While the Fuelband does not do a good job of measuring exercise in a gym, it is a great way to keep a tally of all the walking you do. And if I’m going to spend my life wandering around the city, I might as well get credit for it.





Christoph Hitz




Craft Beer New York



$1.99 for iOS


This app is great when deciding which bars to visit. Of course, it works only for beer drinkers; good bars without good beer selections do not make the cut. There is a nice coffee app designed by the same team, and I use it in essentially the same way, although a bit earlier in the day.






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Germany Moves Closer to Accepting Military Role





BERLIN — When Chancellor Angela Merkel hosted a recent reception for military families, she greeted parents, wives and children whose loved ones were spending their holidays in Afghanistan, Lebanon, Kosovo and off the Horn of Africa. German deployments overseas, Ms. Merkel said, “will soon encompass the entire globe.”




On that same wintry afternoon, members of Parliament debated whether to add to the nearly 6,000 German troops currently serving abroad by sending up to 400 soldiers to Turkey, where they would operate two Patriot missile batteries to help protect their NATO ally from a potential escalation of the civil war across the border in Syria.


“For decades, we Germans have benefited from the fact that our partners gave us the feeling of reliable security,” Thomas de Maizière, Germany’s defense minister, said during the debate last month. “Now we are in a position and have the duty, even, to make our impact felt.”


Only a handful of shivering protesters passed out fliers in front of the Brandenburg Gate opposing the deployment. The vote easily passed in the Parliament two days later.


It was not that long ago that every German military action brought with it mass demonstrations, public hand-wringing and probing questions about the country’s militarist past. But the shadow of history continues to recede here and Germany is, for better or worse, quietly approaching a normal relationship with its armed forces.


For the past three years, Europe has been preoccupied with economic issues as the debt crisis threatened to sunder the euro currency union. But strategic military questions cannot be ignored indefinitely. The United States is increasingly shifting its focus to the Asia-Pacific region and reducing the number of troops stationed in Europe.


“Europe has more responsibility for its own security, and Germany has to step up to that, particularly considering its new economic power in Europe,” said Constanze Stelzenmüller, senior fellow at the German Marshall Fund in Berlin.


Conscription was suspended indefinitely here in 2011 as part of a drive to professionalize and modernize the armed forces. In August, the Constitutional Court ruled for the first time that the German military could be deployed at home under exceptional circumstances, like in the wake of a terrorist attack.


“Naturally, a great deal has developed further in terms of the acceptance of deployments outside of this country and outside the NATO territory,” said Col. Ulrich Kirsch, chairman of the German Federal Armed Forces Association, which represents the interests of active and former military personnel. “But the Germans are, now as before, difficult to inspire for military operations.”


Military business is another matter. Germany is the world’s third-biggest arms exporter, behind only the United States and Russia, sending weapons not only to NATO members and allies like Israel but increasingly to the Middle East and beyond. As the business grows, critics at home question sales to undemocratic countries like Saudi Arabia.


Germany’s military industry employs an estimated 80,000 people, jobs Ms. Merkel wants to protect, especially less than a year before September’s parliamentary election. In October, German opposition helped doom the proposed merger of two aerospace giants, British-based BAE Systems and the consortium EADS, in part out of concern that German jobs and influence might be lost in the new entity.


Last month Der Spiegel, the influential newsmagazine, showed a grim-faced Ms. Merkel on the cover in a camouflage suit jacket with the headline “German Weapons for the World.” The magazine described the Merkel doctrine as deploying fewer German troops to conflict zones and instead strengthening partners by selling them arms. The German government approved military exports in excess of 10 billion euros, or over $13 billion, for the first time in 2011, the magazine reported.


That is an especially impressive feat considering that military expenditures in Western and Central Europe fell 1.9 percent in real terms that year, according to the Stockholm International Peace Research Institute. Those cuts have “prompted unease in many quarters that European countries risk losing global influence as they fall further behind the United States in military capabilities,” the institute said in its most recent annual report on military spending, “while rising powers such as China rapidly catch up and even overtake them.”


Germany’s path forward could well determine the shape of Europe’s military affairs for years to come. Whether that is through a growing leadership role and the assumption of more responsibility for regional security or a limited, some say cynical, emphasis on protecting its own interests still remains to be seen.


“Germany is back in the game as one of the most important countries in the Western Hemisphere, but the kind of responsibility that goes with that is not really reflected in German government behavior,” said Olaf Böhnke, head of the Berlin office of the European Council on Foreign Relations. “If Germany wants to be in a leadership position, you need stronger military engagement.”


German troops have been in Afghanistan for more than a decade, but mostly restricted to the safer northern part of the country. The Bundeswehr, Germany’s army, sent its first Tiger attack helicopters to Afghanistan in December. On Tuesday the army announced that it had not suffered a single fatality in 2012 in Afghanistan.


Chris Cottrell and Victor Homola contributed reporting.



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An Inquiry Into Tech Giants’ Tax Strategies Nears an End





Congressional investigators are wrapping up an inquiry into the accounting practices of Apple and other technology companies that allocate revenue and intellectual property offshore to lower the taxes they pay in the United States.




The Senate Permanent Subcommittee on Investigations inquiry now drawing to a close began more than a year ago and involves at least a half dozen technology companies, according to people with firsthand knowledge of it, who declined to be identified.


Those people said the subcommittee had subpoenaed or otherwise asked the companies to explain methods they used to avoid domestic taxes. They said Apple had become a focus of the inquiry and was cooperating with the subcommittee, which is expected to issue wide-ranging recommendations that are likely to play a significant role in Congressional tax code negotiations.


Apple’s domestic tax bill has drawn the interest of corporate tax experts and policy makers because although the majority of Apple’s executives, product designers, marketers, employees, research and development operations and retail stores are in the United States, in the past Apple’s accountants have found legal ways to allocate about 70 percent of the company’s profits overseas, where tax rates are often much lower, according to corporate filings.


Apple, in a statement on Thursday, said the company was “one of the top corporate income taxpayers in the country, if not the largest.” The statement said the company “conducted all of its business with the highest of ethical standards, complying with applicable laws and accounting rules.”


It is unclear how broadly Senate investigators are looking into the technology industry, if any laws are thought to have been broken and how many companies are involved. The subcommittee is also known to be looking at Google, Hewlett-Packard, Microsoft and firms in such fields as biotechnology.


The subcommittee, which is overseen by Senator Carl Levin, a Michigan Democrat, has been interested in the impact on the budget deficit of offshore tax strategies. Representatives from Microsoft and Hewlett-Packard testified at a subcommittee hearing on the subject in September. Both companies were criticized sharply by Senator Levin for using accounting rules to allocate revenue to other nations to avoid paying taxes in the United States.


“This subcommittee has demonstrated in hearings and comprehensive reports how various schemes have helped shift income to offshore tax havens and avoid U.S. taxes,” Senator Levin said at that hearing. “The resulting loss of revenue is one significant cause of the budget deficit, and adds to the tax burden that ordinary Americans bear.”Apple has long been a pioneer in developing innovative tax strategies that lessen its domestic taxes. At the September hearing, Senator Levin said the investigation indicated that Apple had deferred taxes on over $35.4 billion in offshore income between 2009 and 2011.


Tech companies are able to easily shift “intellectual property, and the profit that goes along with it, to tax havens,” said a former Treasury Department economist, Martin A. Sullivan. “Apple went out of its way to try and ensure that its tax savings didn’t attract too much public attention, because tax avoidance of that magnitude — even though it’s legal and permissible — isn’t in keeping with the image of a socially progressive company.”


In its statement, Apple said it paid “an enormous amount of taxes” to local, state and federal governments. “In fiscal 2012 we paid $6 billion in federal corporate income taxes, which is 1 out of every 40 dollars in corporate income taxes collected by the U.S. government,” it said. In the 1980s, Apple was a pioneer of an accounting technique known as the “Double Irish With a Dutch Sandwich,” which reduces taxes by routing profits through Irish subsidiaries and the Netherlands and then to the Caribbean. Today, that tactic is used by hundreds of other corporations — some of which directly imitated Apple’s methods, say accountants at those companies. More recently, Apple has moved revenue to states like Nevada and overseas nations where the company pays less, or in some cases no, taxes.


Almost every major corporation tries to minimize its taxes. However, technology companies are particularly well positioned to take advantage of tax codes written for an industrial age and ill-suited to today’s digital economy.


Some profits at companies like Apple, Google, Amazon, Hewlett-Packard and Microsoft emerge from royalties on intellectual property, like the patents on software. At other times, products are digital, such as downloaded songs or movies. It is much easier for businesses with royalties and digital products to move profits to low-tax countries than it is, say, for grocery stores or automakers.


Although technology is now one of the nation’s largest and most highly valued industries, many tech companies are among the least taxed, according to government and corporate data. Over the last two years, the 71 technology companies in the Standard & Poor’s 500-stock index — including Apple, Google, Yahoo and Dell — reported paying worldwide cash taxes at a rate that, on average, was a third less than other S.& P. companies’, according to a New York Times analysis. (Cash taxes may include payments for multiple years.)


Companies report their cash outlays for income taxes in their annual Form 10-K, but it is impossible from those numbers to determine precisely how much, in total, corporations pay to governments.


This article has been revised to reflect the following correction:

Correction: January 3, 2013

An earlier version of this article included outdated information on Apple’s tax payments. The company paid $6 billion in federal corporate income taxes in fiscal year 2012, according to a company statement on Thursday; it did not pay $3.3 billion “last year.” (That was the amount of cash taxes the company paid in fiscal year 2011.)




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Scant Proof Is Found to Back Up Claims by Energy Drinks





Energy drinks are the fastest-growing part of the beverage industry, with sales in the United States reaching more than $10 billion in 2012 — more than Americans spent on iced tea or sports beverages like Gatorade.




Their rising popularity represents a generational shift in what people drink, and reflects a successful campaign to convince consumers, particularly teenagers, that the drinks provide a mental and physical edge.


The drinks are now under scrutiny by the Food and Drug Administration after reports of deaths and serious injuries that may be linked to their high caffeine levels. But however that review ends, one thing is clear, interviews with researchers and a review of scientific studies show: the energy drink industry is based on a brew of ingredients that, apart from caffeine, have little, if any benefit for consumers.


“If you had a cup of coffee you are going to affect metabolism in the same way,” said Dr. Robert W. Pettitt, an associate professor at Minnesota State University in Mankato, who has studied the drinks.


Energy drink companies have promoted their products not as caffeine-fueled concoctions but as specially engineered blends that provide something more. For example, producers claim that “Red Bull gives you wings,” that Rockstar Energy is “scientifically formulated” and Monster Energy is a “killer energy brew.” Representative Edward J. Markey of Massachusetts, a Democrat, has asked the government to investigate the industry’s marketing claims.


Promoting a message beyond caffeine has enabled the beverage makers to charge premium prices. A 16-ounce energy drink that sells for $2.99 a can contains about the same amount of caffeine as a tablet of NoDoz that costs 30 cents. Even Starbucks coffee is cheap by comparison; a 12-ounce cup that costs $1.85 has even more caffeine.


As with earlier elixirs, a dearth of evidence underlies such claims. Only a few human studies of energy drinks or the ingredients in them have been performed and they point to a similar conclusion, researchers say — that the beverages are mainly about caffeine.


Caffeine is called the world’s most widely used drug. A stimulant, it increases alertness, awareness and, if taken at the right time, improves athletic performance, studies show. Energy drink users feel its kick faster because the beverages are typically swallowed quickly or are sold as concentrates.


“These are caffeine delivery systems,” said Dr. Roland Griffiths, a researcher at Johns Hopkins University who has studied energy drinks. “They don’t want to say this is equivalent to a NoDoz because that is not a very sexy sales message.”


A scientist at the University of Wisconsin became puzzled as he researched an ingredient used in energy drinks like Red Bull, 5-Hour Energy and Monster Energy. The researcher, Dr. Craig A. Goodman, could not find any trials in humans of the additive, a substance with the tongue-twisting name of glucuronolactone that is related to glucose, a sugar. But Dr. Goodman, who had studied other energy drink ingredients, eventually found two 40-year-old studies from Japan that had examined it.


In the experiments, scientists injected large doses of the substance into laboratory rats. Afterward, the rats swam better. “I have no idea what it does in energy drinks,” Dr. Goodman said.


Energy drink manufacturers say it is their proprietary formulas, rather than specific ingredients, that provide users with physical and mental benefits. But that has not prevented them from implying otherwise.


Consider the case of taurine, an additive used in most energy products.


On its Web site, the producer of Red Bull, for example, states that “more than 2,500 reports have been published about taurine and its physiological effects,” including acting as a “detoxifying agent.” In addition, that company, Red Bull of Austria, points to a 2009 safety study by a European regulatory group that gave it a clean bill of health.


But Red Bull’s Web site does not mention reports by that same group, the European Food Safety Authority, which concluded that claims about the benefits in energy drinks lacked scientific support. Based on those findings, the European Commission has refused to approve claims that taurine helps maintain mental function and heart health and reduces muscle fatigue.


Taurine, an amino acidlike substance that got its name because it was first found in the bile of bulls, does play a role in bodily functions, and recent research suggests it might help prevent heart attacks in women with high cholesterol. However, most people get more than adequate amounts from foods like meat, experts said. And researchers added that those with heart problems who may need supplements would find far better sources than energy drinks.


Hiroko Tabuchi contributed reporting from Tokyo and Poypiti Amatatham from Bangkok.



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An Inquiry Into Tech Giants’ Tax Strategies Nears an End





Congressional investigators are wrapping up an inquiry into the accounting practices of Apple and other technology companies that allocate revenue and intellectual property offshore to lower the taxes they pay in the United States.




The Senate Permanent Subcommittee on Investigations inquiry now drawing to a close began more than a year ago and involves at least a half dozen technology companies, according to people with firsthand knowledge of it, who declined to be identified.


Those people said the subcommittee had subpoenaed or otherwise asked the companies to explain methods they used to avoid domestic taxes. They said Apple had become a focus of the inquiry and was cooperating with the subcommittee, which is expected to issue wide-ranging recommendations that are likely to play a significant role in Congressional tax code negotiations.


Apple’s domestic tax bill has drawn the interest of corporate tax experts and policy makers because although the majority of Apple’s executives, product designers, marketers, employees, research and development operations and retail stores are in the United States, in the past Apple’s accountants have found legal ways to allocate about 70 percent of the company’s profits overseas, where tax rates are often much lower, according to corporate filings.


Apple, in a statement on Thursday, said the company was “one of the top corporate income taxpayers in the country, if not the largest.” The statement said the company “conducted all of its business with the highest of ethical standards, complying with applicable laws and accounting rules.”


It is unclear how broadly Senate investigators are looking into the technology industry, if any laws are thought to have been broken and how many companies are involved. The subcommittee is also known to be looking at Google, Hewlett-Packard, Microsoft and firms in such fields as biotechnology.


The subcommittee, which is overseen by Senator Carl Levin, a Michigan Democrat, has been interested in the impact on the budget deficit of offshore tax strategies. Representatives from Microsoft and Hewlett-Packard testified at a subcommittee hearing on the subject in September. Both companies were criticized sharply by Senator Levin for using accounting rules to allocate revenue to other nations to avoid paying taxes in the United States.


“This subcommittee has demonstrated in hearings and comprehensive reports how various schemes have helped shift income to offshore tax havens and avoid U.S. taxes,” Senator Levin said at that hearing. “The resulting loss of revenue is one significant cause of the budget deficit, and adds to the tax burden that ordinary Americans bear.”Apple has long been a pioneer in developing innovative tax strategies that lessen its domestic taxes. At the September hearing, Senator Levin said the investigation indicated that Apple had deferred taxes on over $35.4 billion in offshore income between 2009 and 2011.


Tech companies are able to easily shift “intellectual property, and the profit that goes along with it, to tax havens,” said a former Treasury Department economist, Martin A. Sullivan. “Apple went out of its way to try and ensure that its tax savings didn’t attract too much public attention, because tax avoidance of that magnitude — even though it’s legal and permissible — isn’t in keeping with the image of a socially progressive company.”


In its statement, Apple said it paid “an enormous amount of taxes” to local, state and federal governments. “In fiscal 2012 we paid $6 billion in federal corporate income taxes, which is 1 out of every 40 dollars in corporate income taxes collected by the U.S. government,” it said. In the 1980s, Apple was a pioneer of an accounting technique known as the “Double Irish With a Dutch Sandwich,” which reduces taxes by routing profits through Irish subsidiaries and the Netherlands and then to the Caribbean. Today, that tactic is used by hundreds of other corporations — some of which directly imitated Apple’s methods, say accountants at those companies. More recently, Apple has moved revenue to states like Nevada and overseas nations where the company pays less, or in some cases no, taxes.


Almost every major corporation tries to minimize its taxes. However, technology companies are particularly well positioned to take advantage of tax codes written for an industrial age and ill-suited to today’s digital economy.


Some profits at companies like Apple, Google, Amazon, Hewlett-Packard and Microsoft emerge from royalties on intellectual property, like the patents on software. At other times, products are digital, such as downloaded songs or movies. It is much easier for businesses with royalties and digital products to move profits to low-tax countries than it is, say, for grocery stores or automakers.


Although technology is now one of the nation’s largest and most highly valued industries, many tech companies are among the least taxed, according to government and corporate data. Over the last two years, the 71 technology companies in the Standard & Poor’s 500-stock index — including Apple, Google, Yahoo and Dell — reported paying worldwide cash taxes at a rate that, on average, was a third less than other S.& P. companies’, according to a New York Times analysis. (Cash taxes may include payments for multiple years.)


Companies report their cash outlays for income taxes in their annual Form 10-K, but it is impossible from those numbers to determine precisely how much, in total, corporations pay to governments.


This article has been revised to reflect the following correction:

Correction: January 3, 2013

An earlier version of this article included outdated information on Apple’s tax payments. The company paid $6 billion in federal corporate income taxes in fiscal year 2012, according to a company statement on Thursday; it did not pay $3.3 billion “last year.” (That was the amount of cash taxes the company paid in fiscal year 2011.)




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John Sheardown, Canadian Who Sheltered Americans in Tehran, Dies at 88





When militant radicals seized the United States Embassy in Iran in November 1979, they intended to take all its employees hostage. But five were elsewhere in the embassy compound and escaped capture. After six tense days of furtively moving around Tehran, one of them, Robert Anders, placed a call to a Canadian diplomat with whom he played tennis, and asked for help.







Sheardown Family, via Ottawa Citizen.

John Sheardown, right, with Kenneth Taylor, the former Canadian ambassador to Iran, in 2010.






“Hell, yes, of course,” the diplomat, John Sheardown, answered. “Count on us.”


The five employees had by then been joined by a sixth. Four ended up being hidden for nearly three months in the home of Mr. Sheardown, the Canadian Embassy’s No. 2 official, who died on Sunday at 88. The other two found refuge with the Canadian ambassador, Ken Taylor.


The episode, which came to be known as the “Canadian caper,” was a footnote to the Iranian hostage crisis, in which young Iranian revolutionaries seized the American Embassy and held 52 people hostage for 444 days to try to force the United States to return the deposed shah from New York, where he was being treated for cancer. After the shah died in July 1980 in Egypt and war erupted between Iran and Iraq, negotiations with the United States led to the release of the hostages in January 1981.


The concealment and extrication of the American diplomats by the Canadian government and the Central Intelligence Agency inspired the recent movie “Argo.” Though Mr. Sheardown is not mentioned in it — public recognition always gravitated to Mr. Taylor, who is portrayed in the film as a hero — his role was nevertheless consequential.


“Without his enthusiastic welcome, we might have tried to survive on our own a few more days,” Mark Lijek, a retired Foreign Service officer, wrote in Slate last year. “We would have failed.”


Mr. Sheardown’s avuncular, pipe-puffing manner led his houseguests to call him Big Daddy. He bought groceries at different stores to disguise his household’s suddenly larger appetite. He bribed the garbage collector with money and beer for the same reason. Surveillance, including tanks at the end of the street, was constant. Strangers knocked on the front door, suspicious calls were commonplace, their car was repeatedly searched.


“We were already living in danger,” Mr. Sheardown’s wife, Zena, said in an interview on Wednesday. “And certainly the danger was compounded because we were hiding, literally hiding, fugitives.”


Mr. Sheardown, she said, died in Ottawa, where he lived, after being treated for Alzheimer’s disease and other ailments.


John Vernon Sheardown was born on Oct. 11, 1924, in Sandwich, Ontario, a small town absorbed by Windsor in the 1930s. At 18, he joined the Canadian Air Force and flew a bomber in World War II, once crash-landing near an English village after limping back from an attack on Germany. He broke both legs, but was able to crawl to a pub door at 3 a.m. and rouse the owner. He asked for a glass of Scotch, which the owner gave him. The owner then asked for payment while Mr. Sheardown waited for an ambulance — a story Mr. Sheardown relished.


He joined Canada’s immigration service in the early 1960s and later transferred to the foreign service, where he specialized in immigration matters. He was busy in Tehran with Iranians who wanted to leave the country, as well as with Afghans who had fled their country after the Soviet Union invaded it in December 1979. His houseguests became an official part of his responsibilities after the Canadian Parliament held its first secret session since World War II to approve the rescue mission, which included issuing the Americans fake Canadian passports.


While in Tehran, the Americans in his rented 20-room house occupied themselves by listening to news on a shortwave radio, reading, playing Scrabble and cards and, by their own admission, drinking copiously. They had to leave the house only once, when the owner had a real estate agent show it to a potential buyer. The two Americans staying with Ambassador Taylor were spirited to the Sheardown house for Thanksgiving and Christmas.


The diplomats posed as members of a film crew who had supposedly been scouting locations. They had been taught how to speak like Canadians — for instance, by ending sentences with “eh?” One was given a Molson beer key ring.


Mr. Sheardown’s first marriage, to Kathleen Benson, ended in divorce. Besides his wife, the former Zena Khan, he is survived by his sons, Robin and John; his sisters, Jean Fitzsimmons and Betty Ann Whitehead; six grandchildren; and 10 great-grandchildren.


After being awarded a high honor, the Order of Canada, Mr. Sheardown fought for his wife, a British citizen, to receive the same award. She had been legally excluded from consideration because she had never lived in Canada. He argued that she had had the tougher job because she seldom left the house while living in danger. She received the honor in 1981.


After “Argo” appeared in theaters, Ms. Sheardown said, its director, Ben Affleck, called to apologize for leaving her and her husband out of the movie. In an interview on Thursday, Mr. Affleck said he had been fully aware of the Sheardowns’ heroism before the film was shot, but had reluctantly omitted it for reasons of length, drama and cost.


“They got lost in the shuffle,” Mr. Affleck said. “It really did break my heart a bit.”


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Bits Blog: Data Dump: Are Potential Panelists Scorning Google?

Suppose a stranger showed up at your house, a shiny new modem under his arm. He says he wants to attach the device to your computer so he can see everything you do online — how you update your Facebook friends with news about your cats, how you use Twitter to flatter your boss, how you single-handedly are keeping the cult of Kim Kardashian alive. He says he will use the information to help make the Internet run more smoothly. All mankind will benefit.

It probably wouldn’t take you long to slam the door. You might consider moving your couch up against it too, just to be sure.

But what if he said he was working for Google, a company that has promised to do no evil, and offered you five shiny new dollar bills to sweeten the deal?

Thousands, perhaps tens of thousands, of people are confronting this question. Google has hired a research company, GfK Custom Research, to send out old-fashioned letters seeking cooperation for its Screenwise Panel project, a tracking effort intended to help not only Google but “experts at universities” conduct “important research on trends in the way people use media.” Full-scale participation, the letter promises, will reap even more loot: $50 a month “or even more.”

As usual with Google, it wants information to flow in only one direction: toward Google. The history of Screenwise is thus a little vague. It was never officially announced but the tech media noticed a sign-up page early last year, and some sites wrote about it at the time. As Search Engine Land noted, “the timing of this program seems odd, especially considering the backlash that Google has faced over the upcoming changes to its privacy policy.” A few weeks later, Google acknowledged the existence of Screenwise in a blog post.

The Street View controversy, where Google secretly scooped up Internet traffic from households and then fought a full disclosure of its activities, also did not seem to bode well for another data collection program, even if this one was completely opt-in.

Initially, perhaps, people loved the idea of participating in Screenwise. The sign-up page reportedly crashed because of heavy traffic. That was the last anyone heard of it. Even Marc Rotenberg, the executive director of the Electronic Privacy Information Center, which keeps an attentive watch on privacy issues at the search engine, figured Google had abandoned Screenwise.

But it merely changed tactics. Despite that supposed flood of interest in signing up, the program still needed many more participants. It appears that people did not love the idea quite as much as it seemed. And so Google started quietly seeking more people to join.

I heard about the new Screenwise from my sister-in-law, who got a letter addressed to “current resident.” With so many devices in her family, Google was offering to pay about $100 a month. That was tempting, but Carolyn had some privacy qualms. Knowing that Google is tracking via Gmail and Chrome just about everything you are doing is one thing; actively encouraging this through a special modem is another.

As Carolyn was debating whether to proceed, Screenwise called her. “It was kind of a high-pressure conversation,” she told me. “The woman on the line insisted that all they wanted to know was how much time we were on the Internet each day, not what we were doing there. Right.” Later, Carolyn wondered how Screenwise got her phone number. She decided the money was not worth it.

Andrea Faville, a Google spokeswoman, said the company does “panel research to help better serve our users by learning more about people’s media use on the web and elsewhere.” She added that the Screenwise panels “are completely optional to join and we’ve invested significantly to ensure that panelists’ security and privacy are protected.”

Another reason Google might be having trouble getting enough participants could have to do with the name on the letter. It is signed, “J. Michael Dennis, Ph.D.” Since that graduate degree is pointedly emphasized, some recipients are probably searching for Mr. Dennis on Google. They will quickly find that not only is he a questionnaire expert but that his dissertation was on “The Politics of Kidney Transplantation.”

Mr. Dennis told me he could not comment about his work for Google. Are people worried that they will tell someone on Google Chat that they are going to take a nap and wake up the next day in a bathtub full of ice, missing a vital organ — just like in the popular urban legend? Maybe people will willingly surrender their privacy on the Internet but want at all costs to keep their kidneys.

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Advertising: Planet Fitness Sheds Aspirational Approach





COMMERCIALS for gyms tend to feature actors who look like Calvin Klein underwear models, with physiques that most will not achieve no matter how long they spend on an elliptical machine.




Planet Fitness, a national chain of about 600 fitness clubs, is introducing a campaign that mocks fitness fanatics, especially those whose devotion infringes on others.


A new commercial opens with a slight woman who is curling small dumbbells in a drab gym as a brawny man berates her like a drill sergeant.


“If you can’t handle a big girl’s workout, the little girl’s gym is right across the street!” shouts the man, a whistle hanging around his neck and his hands balled into fists, as the woman appears to be on the brink of tears. “If you were committed to this workout the way you committed to that morning doughnut, you’d be puking out your ears right now!”


The spot cuts to a flashing light and siren and the words “Lunk Alarm,” and then to the same woman in street clothes being given a tour of a Planet Fitness facility.


“And that’s why I don’t like gyms,” she says.


“Well,” begins the employee showing her around, “we’re not a gym — we’re Planet Fitness.”


The ad closes with a voice-over, which says: “No gymtimidation. No lunks. Just $10 a month.”


The ad, by Red Tettemer & Partners in Philadelphia, will be introduced widely on Jan. 10. Three other spots in the campaign follow the same structure, opening with overbearing gym rats and closing with assurances that Planet Fitness is more laid back.


Planet Fitness will spend an estimated $10 million to $12 million on the campaign. It spent $15.8 million on advertising in the first nine months of 2012, more than the $14.9 million it spent in all of 2011, according to Kantar Media, a unit of WPP.


Rather than being just a narrative device in the spots, lunk alarms have actually been fixtures at Planet Fitness gyms. Members who exhibit lunk behavior, which the company defines on posters in its facilities as grunting, dropping weights loudly and being judgmental, are subject to a public shaming when a manager at the facility sounds the alarm.


In some cases, Planet Fitness even revokes memberships, as it did at a location in Wappingers Falls, N.Y., in 2006. Albert Argibay, a bodybuilder whose exertions were considered grunting by Planet Fitness, but which Mr. Argibay countered in news accounts as merely heavy breathing, kept lifting after he was told to leave, and was eventually escorted from the premises by police officers.


While the slogan “No Gymtimidation” is being introduced with the new campaign, the company has for years promised what it calls a “judgment-free zone.” That, in the words of the Planet Fitness Web site, “means members can relax, get in shape, and have fun without being subjected to the hard-core, look-at-me attitude that exists in too many gyms.”


Jamie Medeiros, director of marketing at Planet Fitness, said that only about 15 percent of Americans belonged to gyms, and that the company was focused not on trying to lure consumers from other facilities but on enticing those who had avoided gyms altogether.


“We go after the 85 percent who don’t belong to a gym now or who have never belonged to a gym,” Ms. Medeiros said.


While many chains sell protein powders and a wide range of supplements, Planet Fitness takes the counterintuitive approach of serving the type of food that dieters typically avoid.


Every month members are treated to pizza on the first Monday night and bagels on the second Tuesday morning, while Tootsie Rolls are handed out daily.


“The common person doesn’t have time to work out every day, and they may not aspire to the type of person who has six-pack abs and eats egg whites,” Ms. Medeiros said. “But we want to be the type of facility that people want to go to as opposed to, ‘Oh my god, I have to go to the gym today!’ ”


The company has thrived even during the economic downturn, growing to four million members today from about 3.2 million a year ago, according to Ms. Medeiros. About 60 percent of its members are women, much higher than what Ms. Medeiros said is the national average of 20 percent.


Health clubs, like cellphone carriers, tend to sell one- or two-year contracts, but Planet Fitness instead has a month-to-month plan, at $10 monthly, which the company believes knocks down a barrier to joining.


Among consumers who exercise, 71 percent agreed with the statement that fitness clubs were too expensive, according to a survey by Mintel, a market research firm. As for the atmosphere, only 27 percent said that they enjoyed the social aspects of gyms.


When brands hire celebrity endorsers and attractive models, marketers typically refer to the advertisements as aspirational, meaning that consumers do not see themselves reflected in the ad as much as an ideal to which they aspire. But Steve Red, the chief creative officer of Red Tettemer & Partners, said the aspirational approach can backfire when it comes to promoting health clubs.


“I’m never going to get to be that washboard-stomach, super-cut guy that I see in the Equinox ads,” said Mr. Red, referring to the chain of upscale gyms. “There are a ton of gym brands that are all about being cut and sinewy and having a six-pack, but I would argue that approach is not aspirational — it’s inaccessible.”


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Advertising: Planet Fitness Sheds Aspirational Approach





COMMERCIALS for gyms tend to feature actors who look like Calvin Klein underwear models, with physiques that most will not achieve no matter how long they spend on an elliptical machine.




Planet Fitness, a national chain of about 600 fitness clubs, is introducing a campaign that mocks fitness fanatics, especially those whose devotion infringes on others.


A new commercial opens with a slight woman who is curling small dumbbells in a drab gym as a brawny man berates her like a drill sergeant.


“If you can’t handle a big girl’s workout, the little girl’s gym is right across the street!” shouts the man, a whistle hanging around his neck and his hands balled into fists, as the woman appears to be on the brink of tears. “If you were committed to this workout the way you committed to that morning doughnut, you’d be puking out your ears right now!”


The spot cuts to a flashing light and siren and the words “Lunk Alarm,” and then to the same woman in street clothes being given a tour of a Planet Fitness facility.


“And that’s why I don’t like gyms,” she says.


“Well,” begins the employee showing her around, “we’re not a gym — we’re Planet Fitness.”


The ad closes with a voice-over, which says: “No gymtimidation. No lunks. Just $10 a month.”


The ad, by Red Tettemer & Partners in Philadelphia, will be introduced widely on Jan. 10. Three other spots in the campaign follow the same structure, opening with overbearing gym rats and closing with assurances that Planet Fitness is more laid back.


Planet Fitness will spend an estimated $10 million to $12 million on the campaign. It spent $15.8 million on advertising in the first nine months of 2012, more than the $14.9 million it spent in all of 2011, according to Kantar Media, a unit of WPP.


Rather than being just a narrative device in the spots, lunk alarms have actually been fixtures at Planet Fitness gyms. Members who exhibit lunk behavior, which the company defines on posters in its facilities as grunting, dropping weights loudly and being judgmental, are subject to a public shaming when a manager at the facility sounds the alarm.


In some cases, Planet Fitness even revokes memberships, as it did at a location in Wappingers Falls, N.Y., in 2006. Albert Argibay, a bodybuilder whose exertions were considered grunting by Planet Fitness, but which Mr. Argibay countered in news accounts as merely heavy breathing, kept lifting after he was told to leave, and was eventually escorted from the premises by police officers.


While the slogan “No Gymtimidation” is being introduced with the new campaign, the company has for years promised what it calls a “judgment-free zone.” That, in the words of the Planet Fitness Web site, “means members can relax, get in shape, and have fun without being subjected to the hard-core, look-at-me attitude that exists in too many gyms.”


Jamie Medeiros, director of marketing at Planet Fitness, said that only about 15 percent of Americans belonged to gyms, and that the company was focused not on trying to lure consumers from other facilities but on enticing those who had avoided gyms altogether.


“We go after the 85 percent who don’t belong to a gym now or who have never belonged to a gym,” Ms. Medeiros said.


While many chains sell protein powders and a wide range of supplements, Planet Fitness takes the counterintuitive approach of serving the type of food that dieters typically avoid.


Every month members are treated to pizza on the first Monday night and bagels on the second Tuesday morning, while Tootsie Rolls are handed out daily.


“The common person doesn’t have time to work out every day, and they may not aspire to the type of person who has six-pack abs and eats egg whites,” Ms. Medeiros said. “But we want to be the type of facility that people want to go to as opposed to, ‘Oh my god, I have to go to the gym today!’ ”


The company has thrived even during the economic downturn, growing to four million members today from about 3.2 million a year ago, according to Ms. Medeiros. About 60 percent of its members are women, much higher than what Ms. Medeiros said is the national average of 20 percent.


Health clubs, like cellphone carriers, tend to sell one- or two-year contracts, but Planet Fitness instead has a month-to-month plan, at $10 monthly, which the company believes knocks down a barrier to joining.


Among consumers who exercise, 71 percent agreed with the statement that fitness clubs were too expensive, according to a survey by Mintel, a market research firm. As for the atmosphere, only 27 percent said that they enjoyed the social aspects of gyms.


When brands hire celebrity endorsers and attractive models, marketers typically refer to the advertisements as aspirational, meaning that consumers do not see themselves reflected in the ad as much as an ideal to which they aspire. But Steve Red, the chief creative officer of Red Tettemer & Partners, said the aspirational approach can backfire when it comes to promoting health clubs.


“I’m never going to get to be that washboard-stomach, super-cut guy that I see in the Equinox ads,” said Mr. Red, referring to the chain of upscale gyms. “There are a ton of gym brands that are all about being cut and sinewy and having a six-pack, but I would argue that approach is not aspirational — it’s inaccessible.”


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In Victory for Google, U.S. Ends Antitrust Investigation





WASHINGTON — The Federal Trade Commission on Thursday found that Google had not violated antitrust or anticompetition statutes in the way it structures its Web search application — handing a big victory to the search giant in its ongoing dispute with regulators.




But the commission found that Google had misused its broad patents on cellphone technology, and ordered Google to make that technology available to rivals.


Google’s competitors, including Microsoft, have pressed vigorously for federal officials to bring an antitrust case involving its search business. Last year, an F.T.C. staff report recommended that the commission bring such a case.


The F.T.C. found that although Google sometimes favors its own products when producing search results with its ubiquitous search engine, its actions were “not undertaken without legitimate justification,” said Jon Leibowitz, the F.T.C. chairman.


Google agreed, however, to take certain actions to address what Mr. Leibowitz called “the most problematic business practices,” those that “relate to search in search advertising.”


The trade commission’s inquiry has been going on for at least a year and a half. Google disclosed in June 2011 that it had received formal notification from the commission that it was looking into Google’s business practices.


Google has long defended its search business, saying that it offers results that are most relevant to consumers and that the “competition is just a click away.” It contends that users who believe a Google search is not meeting their needs can easily move to another search engine, like Microsoft’s Bing.


Google has also said that the barriers to entry into the search business are so low that it cannot abuse its market power, even though it has more than a 70 percent share of the search business in the United States.


Companies that rely on Google to drive traffic to their sites have complained that Google adjusts its search algorithm to favor its own growing number of commerce sites — including shopping, local listings and travel.


But the trade commission faced an uphill battle in proving malicious intent — that Google changes its search algorithm to purposely harm competitors and favor itself. Antitrust lawyers say anticompetitive behavior cannot be proved simply by showing that a change in the algorithm affects other Web sites and causes sites to show up lower in results, even though studies have shown that users rarely look beyond the first page of search results.


The commission was pressing to wrap up its case before Monday, when a new commissioner will be sworn in, a development that could have affected the result of the Google investigation. Joshua D. Wright, a professor at George Mason University, was confirmed by the Senate this week to take one of the two Republican spots on the five-member commission. Mr. Wright had previously said he would recuse himself from any Google matters for two years, because he has done work for or about the company including co-authoring a paper arguing that Google has not violated any antitrust statutes.


Mr. Wright will replace J. Thomas Rosch, a commissioner since 2006. If the Google case were not settled by Monday, the commission faced the prospect that a vote on whether to charge Google would deadlock at 2-2.


The commission voted 4-1 to settle the patent charges, and voted 5-0 to close its antitrust and competition investigation.


“The F.T.C.’s credibility is eroded when confidential details of internal discussions are revealed to the media, as has continually been the case in the investigation of Google,” Senator Ron Wyden, Democrat of Oregon, said in a Nov. 26 letter to Mr. Leibowitz, the commission chairman. Mr. Wyden also said there was plenty of evidence that adequate competition exists in the search business. He cited the recent introduction of competitors like DuckDuckGo, which has a no-tracking privacy policy inspired by some consumers’ complaints about the tracking of consumer behavior that Google and other search engines perform.


“Compared to almost any other market in the history of antitrust regulation, online search has effectively zero barriers to entry,” Mr. Wyden said.


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Gérard Depardieu, Citizen of Russia



But since then, a public feud between Mr. Depardieu and French officials has continued to simmer over Mr. Depardieu’s complaint a few days earlier about France’s high tax rates on the wealthy. French politicians and commentators have lambasted him for renouncing his French citizenship and registering as a resident of Néchin in Belgium, which has lower taxes. And on Thursday, the Kremlin announced that Mr. Putin had kept his promise and had signed a decree making Mr. Depardieu a citizen of Russia.


A spokesman for Mr. Putin, Dmitri Peskov, said that Mr. Depardieu had recently applied for citizenship, and that it was granted in honor of his cultural achievements.


“The thing is that Depardieu has been a part of large film projects and has acted many parts, including the part of Rasputin,” Mr. Peskov told the Interfax news agency. Referring to a television movie about the mad monk, he added, “This film has not been shown here, but it is a very bold and innovative interpretation of the character.”


It seemed likely, however, that Mr. Putin also saw a poetic opportunity in the chance for Russia, long known for losing wealthy citizens to the West, to claim one in return — and not just anyone, but a macho actor instantly recognizable by a giant nose that seems made for sniffing Bordeaux by the barrel.


That Mr. Depardieu might find Russia an attractive place in which to settle down, or at least to declare as his official tax address, fits in well with a narrative that Mr. Putin has developed in recent months portraying Russia not just as a geopolitical equal of Western powers, but as superior in many respects, especially in terms of its performance during the economic downturn.


“On the whole, we made a recovery from the crisis even faster than other countries,” Mr. Putin said. “Just look at the recession in Europe. Russia has posted growth, albeit a modest one, but we still have a much better situation than in the once-prosperous euro zone, or even in the United States.”


Guerrar and Co., a media relations firm that represents Mr. Depardieu, declined to comment on the Kremlin’s announcement.


If Mr. Depardieu chooses to take up Russian citizenship, he would potentially trade steep French income tax rates, which he said now claim 85 percent of his income, and even Belgian rates of 60 percent or higher, for Russia’s flat 13 percent income tax. The value-added tax, a sales tax on goods and services, is 18 percent in Russia compared with nearly 20 percent in France, while Russian social security taxes are 30 percent compared with 50 percent in France.


But aside from tax savings, Mr. Putin suggested that French officials were too brusque in their response to Mr. Depardieu’s complaints and that he might find that Russians simply understand him better as an artist. “Actors, musicians and artists are people with a special, delicate psychological makeup and, as we say in Russia, the artist is easily offended,” Mr. Putin said at the news conference on Dec. 20. “So I understand Mr. Depardieu’s feelings.”


Mr. Putin at the time went out of his way to say that he meant no ill will toward the French. “Among our foreign partners, France stands out,” he said, prefacing his response to a reporter who asked if he had offered Mr. Depardieu residency. “We have had close spiritual ties for centuries now, despite tragic events in our common history.”


Mr. Putin also said that he regarded Mr. Depardieu as thoroughly French as Mr. Putin, a former K.G.B. agent, is Russian. “I must say that even though he said — and I read his statement — that he considers himself a European, a citizen of the world, I know for a fact that he considers himself a Frenchman,” Mr. Putin said. “I know this since we have very friendly, personal relations, even though we have not met many times. He loves his country, its history, its culture; that’s his life.”


Mr. Depardieu, it turns out, is no stranger to Russia. In October, he visited Grozny, the capital of the Russian republic of Chechnya, where he attended a celebration of the capital’s 194th anniversary with the Chechen leader, Ramzan Kadyrov, who has invited Mr. Depardieu to live there.


Video of the October event shows Mr. Depardieu exhorting an appreciative crowd in a mixture of Russian and French: “Glory to Grozny! Glory to Chechnya! Chechnya is strong! Glory to Kadyrov!”


Mr. Depardieu has also agreed to star in a movie written by Gulnara Karimova, the eldest daughter of President Islam Karimov of Uzbekistan, the former Soviet Republic.


A spokeswoman for the French government, Najat Vallaud-Belkacem, said Thursday that the decision to grant Mr. Depardieu a passport was “an exclusive prerogative of the head of the Russian state,” and declined to comment further, Europe 1 radio reported.


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Tech Giants, Learning the Ways of Washington, Brace for More Scrutiny


Mario Tama/Getty Images


Nadine Wolf demonstrated against online piracy legislation a year ago in New York. The measures were defeated.







SAN FRANCISCO — Silicon Valley lobbied hard in Washington in 2012, and despite some friction with regulators, fared fairly well. In 2013, though, government scrutiny is likely to grow. And with this scrutiny will come even greater efforts by the tech industry to press its case in the nation’s capital and overseas.




In 2012, among other victories, the industry staved off calls for federal consumer privacy legislation and successfully pushed for a revamp of an obscure law that had placed strict privacy protections on Americans’ video rental records. It also helped achieve a stalemate on a proposed global effort to let Web users limit behavioral tracking online, using Do Not Track browser settings.


But this year is likely to put that issue in the spotlight again, and bring intense negotiations between industry and consumer rights groups over whether and how to allow consumers to limit tracking.


Congress is likely to revisit online security legislation — meant to safeguard critical infrastructure from attack — that failed last year. And a looming question for Web giants will be who takes the reins of the Federal Trade Commission, the industry’s main regulator, this year. David C. Vladeck, the director of the commission’s Bureau of Consumer Protection, has resigned, and there have been suggestions that the chairman of the commission itself, Jon Leibowitz, will step down.


The agency is investigating Google over possible antitrust violations and will subject Facebook to audits of its privacy policy for the next 20 years. Its next steps could serve as a bellwether of how aggressively the commission will take on Web companies in the second Obama administration.


“Now that the election is over, Silicon Valley companies each are thinking through their strategy for the second Obama administration,” said Peter Swire, a law professor at Ohio State University and a former White House privacy official. “The F.T.C. will have a new Democratic chairman. A priority for tech companies will be to discern the new chair’s own priorities.”


In early 2012, an unusual burst of lobbying by tech companies helped defeat antipiracy bills, which had been backed by the entertainment industry. Silicon Valley giants like Facebook and Google feared that the bills would force them to police the Internet.


At the end of the year, Silicon Valley also got its way when the Obama administration stood up against a proposed global treaty that would have given government authorities greater control over the Web.


The key to the industry’s successes in 2012 was simple: it expanded its footprint in Washington just as Washington began to pay closer attention to how technology companies affect consumers. “Privacy and security became top-tier important policy issues in Washington in 2012,” said David A. Hoffman, director of security policy and global privacy officer at Intel.


“Industry has realized it is important to be engaged,” he continued, “to make sure government stakeholders are fully informed and educated about the role that new technology plays and to make sure any action taken doesn’t unnecessarily burden the innovation economy while still protecting individual trust in new technology.”


At the end of 2012, tech companies were on track to have spent record amounts on lobbying for the year. In the first three quarters, they spent close to $100 million, which meant that they were likely to surpass the $127 million they spent on lobbying in 2011, according to an analysis by the Center for Responsive Politics, a Washington-based nonpartisan group that tracks corporate spending. Even the venture capital firm Andreessen Horowitz hired a lobbyist in Washington: Adrian Fenty, a former mayor of the city.


Technology executives and investors also made generous contributions in the 2012 presidential race, luring both President Obama and Mitt Romney to Northern California for fund-raisers and nudging them to speak out on issues like immigration overhaul and lower tax rates.


In a blog post in November, the center said Silicon Valley’s lobbying expenditures have ballooned in recent years, even as spending by other industries has fallen.


This article has been revised to reflect the following correction:

Correction: January 2, 2013

An earlier version of this article referred imprecisely to the federal agency headed by Jon Leibowitz. He is chairman of the Federal Trade Commission, not of its Bureau of Consumer Protection.



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Hispanic Pregnancies Fall in U.S. as Women Choose Smaller Families





ORLANDO, Fla. — Hispanic women in the United States, who have generally had the highest fertility rates in the country, are choosing to have fewer children. Both immigrant and native-born Latinas had steeper birthrate declines from 2007 to 2010 than other groups, including non-Hispanic whites, blacks and Asians, a drop some demographers and sociologists attribute to changes in the views of many Hispanic women about motherhood.




As a result, in 2011, the American birthrate hit a record low, with 63 births per 1,000 women ages 15 to 44, led by the decline in births to immigrant women. The national birthrate is now about half what it was during the baby boom years, when it peaked in 1957 at 122.7 births per 1,000 women of childbearing age.


The decline in birthrates was steepest among Mexican-American women and women who immigrated from Mexico, at 25.7 percent. This has reversed a trend in which immigrant mothers accounted for a rising share of births in the United States, according to a recent report by the Pew Research Center. In 2010, birthrates among all Hispanics reached their lowest level in 20 years, the center found.


The sudden drop-off, which coincided with the onset of the recession, suggests that attitudes have changed since the days when older generations of Latinos prized large families and more closely followed Roman Catholic teachings, which forbid artificial contraception.


Interviews with young Latinas, as well as reproductive health experts, show that the reasons for deciding to have fewer children are many, involving greater access to information about contraceptives and women’s health, as well as higher education.


When Marucci Guzman decided to marry Tom Beard here seven years ago, the idea of having a large family — a Guzman tradition back in Puerto Rico — was out of the question.


“We thought one, maybe two,” said Ms. Guzman Beard, who gave birth to a daughter, Attalai, four years ago.


Asked whether Attalai might ever get her wish for a little brother or sister, Ms. Guzman Beard, 29, a vice president at a public service organization, said: “I want to go to law school. I’m married. I work. When do I have time?”


The decisions were not made in a vacuum but amid a sputtering economy, which, interviewees said, weighed heavily on their minds.


Latinos suffered larger percentage declines in household wealth than white, black or Asian households from 2005 to 2009, and, according to the Pew report, their rates of poverty and unemployment also grew more sharply after the recession began.


Prolonged recessions do produce dips in the birthrate, but a drop as large as Latinos have experienced is atypical, said William H. Frey, a sociologist and demographer at the Brookings Institution. “It is surprising,” Mr. Frey said. “When you hear about a decrease in the birthrate, you don’t expect Latinos to be at the forefront of the trend.”


D’Vera Cohn, a senior writer at the Pew Research Center and an author of the report, said that in past recessions, when overall fertility dipped, “it bounced back over time when the economy got better.”


“If history repeats itself, that will happen again,” she said.


But to Mr. Frey, the decrease has signaled much about the aspirations of young Latinos to become full and permanent members of the upwardly mobile middle class, despite the challenges posed by the struggling economy.


Jersey Garcia, a 37-year-old public health worker in Miami, is in the first generation of her family to live permanently outside of the Dominican Republic, where her maternal and paternal grandmothers had a total of 27 children.


“I have two right now,” Ms. Garcia said. “It’s just a good number that I can handle.”


“Before, I probably would have been pressured to have more,” she added. “I think living in the United States, I don’t have family members close by to help me, and it takes a village to raise a child. So the feeling is, keep what you have right now.”


But that has not been easy. Even with health insurance, Ms. Garcia’s preferred method of long-term birth control, an IUD, has been unaffordable. Birth control pills, too, with a $50 co-payment a month, were too costly for her budget. “I couldn’t afford it,” she said. “So what I’ve been doing is condoms.”


According to research by the National Latina Institute for Reproductive Health, the overwhelming majority of Latinas have used contraception at some point in their lives, but they face economic barriers to consistent use. As a consequence, Latinas still experience unintended pregnancy at a rate higher than non-Hispanic whites, according to the institute.


And while the share of births to teenage mothers has dropped over the past two decades for all women, the highest share of births to teenage mothers is among native-born Hispanics.


“There are still a lot of barriers to information and access to contraception that exist,” said Jessica Gonzáles-Rojas, 36, the executive director of the institute, who has one son. “We still need to do a lot of work.”


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