Wednesday, March 20, 2019

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Amazon private labels aren't all hits, report says - INSIDER

Posted: 19 Mar 2019 11:55 AM PDT

Amazon's private-label goods haven't taken over the world yet.

The tech giant's incredible number of private-label goods haven't rocked the retail world as some expected. According to a new report from e-commerce research firm Marketplace Pulse, very few of Amazon's private labels have actually become big hits.

Of the 406 brands analyzed by Marketplace Pulse, AmazonBasics — Amazon's home and electronics brand — is the most successful, scooping up 57.8% of Amazon's private-label sales, even though it accounts for only 5% of the new products the company has launched, the firm said.

Following that is the Amazon Collection jewelry brand, with 7.8%, and Amazon Essentials, which sells basic clothing for both men and women, at 4.8%. None of the others make up more than 2% of Amazon's private-label sales.

Measured by sales, the products don't fare any better. All told, sales from Amazon's private-label brands are under $1 billion, according to Marketplace Pulse. That's a lot taken in isolation, but it's also just a fraction of the $122.9 billion Amazon raked in last year from direct online retail sales.

An Amazon spokesperson did not immediately return Business Insider's request for comment on the Marketplace Pulse report.

Amazon is making moves to put its private-label brands in front of customers. It has tested placing its own brands front and center for customers to see and compare to other brands, according to the Wall Street Journal. As part of a recent test, the ads occurred as both pop-ups in the app and on top of desktop webpages, forcing users to scroll down before they could see the product they intended to view.

Private labels are often cheaper than a name brand, making them a compelling offer for customers.

Read more: Elizabeth Warren accuses Amazon of using a 'special information advantage' for 'anti-competitive' practices

Amazon does have to walk a fine line here. Its private-label brands are already scrutinized because Amazon acts as both a direct seller and a platform for other merchants to sell to those same customers.

Presidential hopeful Sen. Elizabeth Warren has already laid out a proposal to separate platforms from providers.

Apple pitches new subscription news service as savior to news business - Business Insider

Posted: 19 Mar 2019 04:01 AM PDT

Apple is set to launch a new all-you-can-read news subscription service along with other services at a big event next Monday, and it's causing major angst among some of the biggest publishers, even those that are sitting it out.

The name of the service hasn't been made public, but it will be a relaunch of Next Issue Media's news-aggregation app Texture, which gives users access to about 200 magazine for a flat fee of $9.99 a month. Apple acquired Texture last March from Condé Nast, Hearst, Meredith, Rogers Media, and KKR.

Apple's pitch to publishers is that it will charge about $10 a month for what will amount to a premium tier of its existing Apple News app that is baked in to Apple mobile devices, according to knowledgeable sources. Apple will share half of the revenue with publishers based on how much time users spend with the given publishers' content, they said.

Read more: New research shows how The New York Times, The Economist, The New Yorker, and other top online subscription publishers stack up

The new service will include publications from Texture's past owners, which were bound by contract to do so. That includes titles like Hearst's Cosmopolitan and Men's Health; Meredith's People; and Condé Nast's Wired and The New Yorker. The New Yorker is allowed to leave after a certain period of time because it has a significant subscription business on its own, according to a knowledgeable source.

With the announcement less than a week away, Apple has been courting the major national newspapers, but to date The New York Times and The Washington Post have not joined, people close to the situation say. The Wall Street Journal is having productive talks with Apple and sees the service as a way to bring its journalism to a much bigger audience, people familiar with its thinking say.

Business Insider talked to a half-dozen publishing execs who are close to the situation. They say that Apple is pitching itself as a savior to the publishing industry — but that its logic is flawed.

Apple wouldn't comment for this story.

Apple is comparing news to music

The critics say Apple is pointing to its success with Apple Music as evidence of its subscription expertise. And it's true that Apple Music has been a bright spot for Apple. It's hit 50 million paid subscribers, which puts it behind its older rival Spotify's 96 million, but it reportedly had a slight edge over Spotify in the US by last summer.

"Based on our experiences with Apple Music, we're very good at running a subscription business," one publishing exec said, describing how Apple pitched the service. "We know how to build a subscription business, and we're going to do that for news."

But the critics say that comparison is flawed. Music, along with entertainment, is inherently different from news. A lot of news articles are interchangeable in a way that music artists or movies aren't. Plus, most people don't want 100 magazines; they just want the ones they're already fans of.

Apple News has 85 million users a month, which sounds like a big pool of potential subscribers for publishers to fish from. But research has shown that just 1% or 2% of a publication's monthly unique audience will pay for a digital subscription. If you apply that rule of thumb to Apple News, that's under 2 million subscribers.

"No one wants an all-you-can-eat magazine service," said one digital publishing exec whose company isn't participating in Apple's service. "Magazines are passion points, whereas music, you do want a library."

Publishers see little financial upside

The other major criticism that top subscription publishers lob at the Apple service is that it won't be a windfall at all. In all, $5 a subscriber would be shared across all the publishers each month. Compare that to the $10-and-up a month that top publishers are getting from people who subscribe directly. The New York Times charges $15 a month for digital access, while The Wall Street Journal charges $39 and The Washington Post charges $10.

"Taking the 85 million (or even assuming major growth as a result of the new bundle service), if you put those numbers into a subscription funnel, no publisher will see a significant lift in subscribers," another publisher who's sitting out the service said.

Among these top publishers, there's a belief that there's little in it for them because they see Apple News as something people use when they have a few minutes to kill, so they're inclined to spend it reading light fare, not the kind of news these publishers charge top dollar for. "People [magazine] should clean up," the digital exec sniffed.

If they're wrong, even worse, publishers worry, the app may end up cannibalizing their existing, higher-value subscribers, turning those subscription dollars into pennies.

Publishers have lots of questions

Overall, the app is a sore point for publishers that have felt pushed around by the platform giants that want their content to get users on their platforms but give back little in the way of revenue and user data. This soreness is exacerbated by the fact that Apple has positioned itself as a good guy versus Google and Facebook when it comes to supporting quality news, with human editors to make sure intentionally false or misleading news doesn't get through.

"There was a perception that Apple was trying to get across that, 'We feel your pain, and we can be a savior, and we don't really need the money, so we're going to kick back most of it to you guys,'" the digital exec said. But the message it sent with its 50-50 split was "tone deaf, big time," this person said.

Here are other questions and concerns on publishers' minds:

  • Data. Reader data is a lifeline for subscription publishers, who use it to retain and sign up new subscribers, but the concern is that Apple won't give them the information they need.
  • Visibility. Being part of a bundle will dilute a given brand's visibility. Publishers will depend on Apple News' team of editors who decide which articles to promote on the app. Will they give additional promotion to publishers that are in the paid tier, ensuring they get seen so they can make money from the service? Will publishers that opt out of the service be relegated to second-class status with Apple?
  • Existing subs. Apple already lets publishers sell subscriptions to their publications through Apple News and keep 70% of the revenue in the first year, then 85% in subsequent years. What happens to that sales channel now that Apple is motivated to get people to subscribe to its own bundle? Will direct subscribers drop those subscriptions in favor of the cheaper bundle?
  • The Android factor. The Texture app on Android devices is expected to go away when Apple launches its own service. What will happen to Texture's app on (Apple rival) Android devices? Will Apple still have a presence on Android — or will its new app make up for what publishers lose from not having a presence on Android? And can Apple catch up to Android globally, which is where it wants to eventually take the service?
  • Other services. Will Apple roll the news service into one mega bundle with music and entertainment? Will that improve its chances of selling people into it, to the benefit of publishers?

All these worries aside, even critics of the forthcoming service see some potential benefits. If Apple News users are "older, Middle America women," as many publishers refer to them broadly, a publication like The Journal has nothing to lose by being part of the bundle because such readers aren't already likely to be subscribers.

A publisher with a small or emerging online subscription business also has little to lose by being part of a bundle. So it may not make sense for The Times, which can charge $15 a month, but it may for Condé Nast's Allure magazine, which is offering a year for $8.

Publications have to provide their full print edition to the service, which means they can count digital subscribers toward their print circulation that they sell advertising against. Apple will let them put additional content behind the paywall, giving them other ways to monetize their articles.

The question is whether these benefits are outweighed by the risks.

Tesla factory workers lost more time due to injury and illness in 2018 - Business Insider

Posted: 19 Mar 2019 12:40 PM PDT

Workers at Tesla's auto plant spent twice as many days away from their jobs due to work-related injuries and illnesses, after adjusting for workforce growth, in 2018 than in 2017, Bloomberg reports, citing a report Tesla filed with the Occupational Safety and Health Administration (OSHA).

Employees at Tesla's Fremont, California, factory spent 22,454 days away from their jobs due to work-related injuries and illnesses in 2018, compared to 7,619 in 2017. While the total number of injuries from Fremont employees increased by around 28%, the rate of injuries per hour worked was about the same as in 2017, according to Bloomberg.

Tesla's overall injury rate was a little lower than those of its competitors, the automaker told Bloomberg.

Read more: SEC rebukes Elon Musk, says his tweet about Tesla vehicle production was a 'blatant violation' of court settlement

A Tesla representative told Business Insider that the number of days an employee spends away from work due to injury does not correspond to the injury's severity. The representative added that the automaker gives employees the time they need to recover from injuries.

Laurie Shelby, Tesla's vice president of environmental health and safety, told Bloomberg that the automaker experienced zero employee fatalities at the Fremont factory in 2017 or 2018 as it increased production of its Model 3 sedan.

"The most important metric is fatalities, and our number is zero," Shelby told Bloomberg. "It was a big ramp year for Model 3, so there were a lot more hours worked, more production staff and more potential for incidents. We really focused on making sure we had our safety team out in the area as we ramped."

Shelby said two-thirds of injuries at Fremont qualified as aggregate trauma caused by repetitive stress to the back, neck, wrists, hands, and shoulders, for example. Tesla told Bloomberg that injured Fremont employees may spend fewer days out of work this year as the automaker introduces initiatives to allow injured workers to return to work in altered roles.

Injury statistics and reports from media outlets have raised questions about worker safety at Tesla's factories, though concerns about workplace safety are not unique to Tesla in the auto industry.

Tesla received more citations from OSHA related to vehicle manufacturing than Ford, General Motors, or Fiat Chrysler from 2017 through the end of 2018. Reports from Reveal published in 2018 claimed that Tesla misreported workplace injuries, avoided using safety markings for aesthetic reasons, and failed to give injured employees proper medical care.

Tesla has denied that it has misreported workplace injuries and failed to use safety markings for aesthetic reasons. The automaker did not respond to requests for comment on the allegation that it failed to give injured employees proper medical treatment.

Read Bloomberg's full report here.

Got a Tesla tip? Contact this reporter at mmatousek@businessinsider.com.

TripAdvisor faces backlash for sexual assault response - INSIDER

Posted: 19 Mar 2019 01:28 PM PDT

  • TripAdvisor is facing backlash for its response to reports of sexual assault.
  • One woman started a petition that has been signed more than 142,000 times, calling for TripAdvisor to change its policies after she says she was raped by a tour guide she found through the service.
  • The woman says that when she asked TripAdvisor to help her warn others about the tour guide, the company suggested that she leave a review.
  • The Guardian reported earlier this month that it found more than 40 instances in which people had reported sexual assault in TripAdvisor reviews, many of which were buried under other reviews.

TripAdvisor is facing backlash for its response to women who reported sexual assaults linked to people and businesses they found through the service.

As of Tuesday, more than 142,000 people have signed a Change.org petition calling for TripAdvisor to "Stop covering up sexual assaults."

The petition was started last week by K., a woman who wishes to remain anonymous, after she told TripAdvisor that she had been raped by a tour guide with top reviews on the service.

"My assault was deeply traumatic and probably one of the worst things I've ever experienced," K. writes on the Change.org page. "But the humiliation I was put through when I turned to TripAdvisor for help was almost worse."

K. writes that when she asked TripAdvisor to help her warn others about the tour guide, the company suggested that she leave a review.

"Not only was this solution woefully inadequate to warn other tourists — my one star review would quickly get lost among minor complaints about the guide — but it required me to relive the painful details of my assault and out myself publicly in a place where my assailant could likely find me," K. writes in the petition.

K. is not the only person highlighting issues with TripAdvisor's policies. Earlier in March, The Guardian reported that — in addition to K.'s account — it uncovered 40 more examples of "reviews describing sexual assault, rape and groping committed by staff members of highly-rated hotels and other travel businesses."

Read more: 2 women are accusing TripAdvisor of telling them to detail their rape allegations in negative reviews instead of flagging the businesses

TripAdvisor did not immediately respond to Business Insider's request for comment, but a spokesperson said earlier in March that it does not remove business listings and instead allows reviews so that customers can have "a transparent record of travelers' experiences at that location."

"TripAdvisor believes that every person impacted by a traveler safety issue, including sexual assault, has the right to write a first-hand account about their experience. Even a brief, non-descriptive mention that a traveler experienced an assault can serve as a powerful warning to the global travel community," the statement said.

Critics of this policy point out that reviews highlighting sexual assault or other safety issues can be buried by other reviews. One women who told The Guardian she had been raped in a hotel in the Caribbean took issue with TripAdvisor's solution, which would lump her response alongside one-star reviews complaining about dirty bed sheets.

TripAdvisor has noted that being listed on the site is not an endorsement. A TripAdvisor spokesperson told INSIDER earlier in March that leaving a review is the best way for other travelers to be alerted of incidents at the hotel, because the company does not monitor every business listed on the site individually.

"No one wants to relive a horrible experience, but that's the best way for other travelers to be alerted," the spokesperson said.

In 2017, TripAdvisor launched a temporary badge that would flag hotels and resorts that had been reported for sexual assault and other safety concerns. The travel website came under fire after a number of users reported having their accounts of rape and assault removed from the site, Business Insider reported at the time.

African cities are running out of water, and the continent needs $66 billion to avoid a crisis of disease and dehydration - Business Insider

Posted: 19 Mar 2019 04:11 PM PDT

One of every three people in Africa is affected by water scarcity— the circumstance in which a region's available water supply isn't enough to meet demand.

In nations like Ghana, Mozambique, and Zimbabwe, water shortages can raise people's risk of getting sick, since when water is in short supply, households often hoard the precious resource indoors, creating a breeding ground for disease-carrying mosquitoes.

Water is also needed to run toilets and basic sanitation facilities. In its absence, residents are often forced to defecate in rivers, a practice that contaminates fresh water with bacteria, viruses, and parasites. Contaminated water also puts residents at increased risk of diseases like cholera and typhoid fever, which can cause dehydration and malnutrition.

A woman collects water from one of the few communal water taps available to the thousands of people living in the Zandspruit informal settlement in Johannesburg, South Africa.
Mujahid Safodien/AFP/Getty Images

That's the case even in major cities like Nairobi, Kenya, and Accra, the capital city of Ghana, which are becoming more dense and urbanized.

Between 2016 and 2050, Africa's population is expected to double, with 80% of new residents located in urban areas. This growth could provide new economic opportunities and higher living standards for urban residents — but only if cities are equipped to handle the strain on their water resources.

Read more: Cape Town is running out of water — I visited and saw what the financial problems of 'Day Zero' look like on the ground

What's more, when women and young girls are forced to walk miles to the nearest water supply, their ability to attend school or earn an income becomes significantly diminished.

The African Development Bank estimated last year that it would require as much as $66 billion to provide universal access to water and sanitation across Africa. That doesn't include the more than $170 billion needed to build critical infrastructure like dams and purification plants.

Without these resources in place, cities like Cape Town, South Africa could find themselves ill-equipped to deal with drought — and might eventually run out of water.

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