Nate McCullough | News Editor
770-718-3431 | news@gainesvilletimes.com
The Times, Gainesville, Georgia
Thursday, January 2, 2020
A decade in review
JOHN CLARK I Associated Press
Boxes roll down the conveyor inside the Amazon Fulfillment Center on Tuckaseegee Road in Charlotte, N.C.
Six ways retail shopping changed over the last 10 years
BY DOREEN CHRISTENSEN
Sun Sentinel
Few decades in history have brought
more change to retail shopping than the
last 10 years.
This year, more than 9,000 retailers
went belly up or closed stores, accord
ing to a tally by Business Insider. Payless
Shoes, Dress Barn, Barney’s, Gymboree,
Sears, Kmart, Charlotte Russ, Chico’s,
Gap, Bed Bath and Beyond, and Office
Depot were among the long list of legacy
retailers that succumbed in the so-called
Great Retail Apocalypse of 2019. Before
that, David’s Bridal, Brookstone, Claire’s,
Bon-Ton, Toys R Us and Sports Authority,
among many others, went down with great
thuds. Malls struggle to rent empty space.
Amazon
The retailer, which began as an online
bookseller in 1994, has profoundly influ
enced and changed how we shop. It now
dominates every aspect of retail. Just a
few years ago, it seemed unimaginable
that millions of us would be forking over
$119 a year for the privilege of shopping
online. Still, Amazon has managed near
total destruction of retail and it is only
going to get bigger, with its long tentacles
touching and shaping how and when we
shop. While Amazon didn’t share sales fig
ures, Cyber Monday was the biggest shop
ping day in the company’s history. That
played into a record $9.4 billion in sales
on Cyber Monday, an all-time record this
year. Walmart and Target are effectively
competing, and have an advantage with
thousands of physical stores. That has
Amazon playing catch-up after acquiring
Whole Foods Market in 2017, with plans
to open dozens of grocery and Amazon
Go convenience stores, sans cashiers.
Amazon now has the $840 billion grocery
market in its crosshairs. Prepare for simi
lar disruption ahead.
The great recession:
The collapse of the United States real
estate market in 2007 caused a calami
tous financial crisis that would reverber
ate through much of this decade, setting
in motion a decade-long obsession with
savings that became a survival tactic
for many struggling consumers. Compa
nies shed more than 8.8 million jobs as
median household wealth fell 35%, from
$106,591 to $68,839 between 2005 and
2011, according to the Center on Budget
Policy and Priorities. The unemployment
rate did not return to 5%, where it was at
the start of the recession, until late 2015.
South Florida suffered more during the
recession than almost any other place in
the country, thanks to a housing bubble
and bust, a 2010 Brookings Institution
study showed. The recession made using
coupons and hunting down deals cool,
ushering in the era of discount chains.
Marshalls and TJ Maxx, long fixtures
in off-price retail, had to move over as
chains with cheap merchandise started
popping up and prospering while legacy
retailers struggled to adapt.
Discount retailers
Thanks to the recession, everyone
needed to save a buck. Dollar Tree, Ross
Dress for Less, DD’s Discounts, Tuesday
Morning, Big Lots, Five Below and other
off-price chains began to multiply like
rabbits. Macy’s, Saks Fifth Avenue, Nor
dstrom, Bloomingdales and others began
opening and expanding outlets. Discount
ers added pressure on brick-and-mortar
legacy retailers such as Sears, Kmart,
JC Penney and others to transform their
business models with a multifaceted
approach to sales or risk certain death.
Any way you want it
As the decade progressed, Amazon’s
dominance made it necessary for retail
ers to provide customers with a seam
less shopping experience no matter how
they wanted to make purchases. This
omnichannel strategy offers consum
ers a seamless experience in stores and
online along with convenient services
such as free in-store pickup and two-day
delivery. Today, Sears and Kmart are on
life support because they were unable to
evolve quickly enough in this arena. JC
Penney struggles. Target, Walmart, Best
Buy, Macy’s and Kohl’s have thrived.
Going mobile
When Apple introduced the iPhone
in 2007, few of us grasped how it would
change so many things. It took a few
years to catch on, but by 2010 we began
paying hundreds of dollars for handheld
devices for everyone in the family and
also paying wireless phone bills that rival
some mortgages. This Cyber Monday
mobile transactions soared, with $3.1 bil
lion of sales coming from smartphones, a
record. Now we use these devices to ring
up savings, log into loyalty programs,
store coupons in mobile wallets, get text
alerts, research products and make pur
chases. Stores use smartphones and apps
to track our movements and spending
when in stores and market their products.
Hearing voices
Remember Hal 9000 in “2001: A Space
Odyssy”? The 1968 film was a decade
off in predicting the advent of artificial
intelligence. Apple made Siri available
on iPhones in 2011. Amazon introduced
its voice assistant, Alexa, on Echo devices
in 2014. Then Google introduced its assis
tant in 2016. Now, we’re all talking to
computers — which are eavesdropping
on us 24/7 — asking them to turn on
music, order items off the internet, make
grocery lists and remind us of every
thing from soccer practice to doctors
appointments.
Huawei announces record 2019 revenue
despite export ban to American suppliers
BY DAVID PIERSON
Los Angeles Times
In a year in which the United States
mounted an unprecedented effort to
undermine China’s largest telecommuni
cations company, Huawei made sure it got
the last word.
The firm announced Tuesday that
its revenue surged 18% to more than
$120 billion in 2019 despite a ban on U.S.
exports to the company starting in May.
“Despite concerted efforts by the U.S.
government to keep us down, we’ve made
it out the other side and continue to create
value for our customers,” Eric Xu, one of
Huawei’s three rotating chairmen, said
in a statement. “These figures are lower
than our initial projections, yet business
remains solid and we stand strong in the
face of adversity.”
The New Year’s Eve message capped
the toughest year yet for the telecommu
nications giant, which was pushed into the
center of the U.S.-China trade war.
In addition to being blacklisted for U.S.
suppliers, the company was indicted in
January by the U.S. Justice Department,
accused of stealing American technology
and violating trade sanctions against Iran.
As a result, the company’s chief financial
officer, Meng Wanzhou, has been under
house arrest in Vancouver, Canada,
fighting extradition to the U.S. She is the
daughter of Huawei’s founder and chief
executive, Ren Zhengfei.
Huawei fought back by suing the U.S.
HUAWEI
WANG ZHAO/AFP I Associated Press
Chinese telecom giant Huawei announced
a revenue of more than $120 billion.
government and launching a public rela
tions campaign. Still, the company has
struggled to dispel fears it poses a national
security threat to other nations because
of its dominant position in manufactur
ing next-generation 5G mobile network
equipment.
The company’s murky past, which
includes Ren’s tenure in the military,
generous state support and evidence of
spying and intellectual property theft has
contributed to widespread distrust of Hua
wei among the U.S. and some of its allies.
The company’s 5G business continues
to grow, however, as Washington hasn’t
been able to persuade many other gov
ernments to follow the U.S. in banning the
Chinese company’s networks. Huawei’s
competitive prices and technology have
given it a leg up on 5G competitors such as
Europe’s Ericsson and Nokia.
Huawei is the world’s second-largest
smartphone manufacturer, and sales of
its handsets helped propel Huawei’s 2019
revenue, Xu said.
Continued access to components
needed to build those phones has been
crucial.
Analysts said Huawei has survived by
increasingly relying on its own chip manu
facturer, HiSilicon. It also switched from
U.S. suppliers to those in Taiwan, Japan
and South Korea after it was blacklisted
by the Trump administration. Meanwhile,
American suppliers that produce their
equipment overseas are still allowed to
do business with Huawei. These factors
together allowed Huawei to forge ahead,
said Dan Wang, a technology analyst for
research firm Gavekal.
“Huawei has been successful in replac
ing components,” Wang said. “It’s a big
surprise to the U.S. government. We’re in
novel territory.”
Where the company will struggle, ana
lysts say, is in producing a viable alterna
tive to Google’s suite of apps, which are no
longer permitted on Huawei’s phones as a
result of the blacklisting. While that won’t
hurt the company’s China market, where
Google is banned, it will affect its foreign
markets, particularly Europe.
Huawei will have to persuade app
developers — many who are cash-
strapped because of the nature of their
business — to take a chance on Huawei’s
mobile ecosystem rather than a sure bet
such as Google.
“The software is crucial,” Wang said.
“It’s quite likely overseas smartphone
sales will suffer.”
Law to force
TV providers
to show costs
BY RON HURTIBISE
Sun Sentinel
Who hasn’t felt ripped off when their cable
or satellite television bill suddenly skyrockets,
with no advance warning?
Who hasn’t felt stung when the first bill for
that $29-a-month plan arrives, packed with
previously undisclosed charges for equipment
rentals, advanced DVR services, broadcast
fees, franchise fees, protection plans, multiple
receiver charges, HD charges, regional sports
fees and more?
Well, lower your blood pressure. Help is on
the way.
A new bill enacted by Congress and signed
in late December by President Donald Trump
will protect consumers from some surprise
fees and at least provide an opportunity to opt
out of the ones to come.
Called the Television Viewer Protection Act
of 2019, the law takes effect on June 20 unless
the Federal Communications Commission
grants a six-month extension.
It will apply to both stand-alone TV pack
ages and the TV portion of bundled plans that
combine TV with internet service.
The law includes several key protections
endorsed by the nonprofit consumer protec
tion agency Consumer Reports:
Cable and satellite TV operators will have
to disclose the full price of their service —
including all fees, charges and taxes, as well
as when promotional discounts will expire —
within 24 hours after consumers sign up.
New subscribers will be able to cancel with
no penalty within 24 hours after receiving the
full-price disclosure.
Providers are forbidden from charging cus
tomers to rent equipment they don’t use, such
as charging to rent a router or modem, when
customers choose to use equipment of their
own.
“People across the country are fed up with
all of the extra fees they pay each month that
keep growing more costly year after year,”
said Consumer Reports senior counsel Jona
than Schwantes. “Cable companies shouldn’t
be allowed to disguise the true cost of service
by charging a long list of add-on fees that
aren’t clearly disclosed when customers sign
up for service.”
AT&T, owner of DirecTV and U-verse,
declined to comment for this story. But a
spokesman pointed to a Dec. 19 blog entry on
AT&T’s website blaming Congress for allow
ing broadcast companies to increase retrans
mission fees charged to cable and satellite
providers from $200 million in 2006 to $11.7
billion in 2019 — an increase of more than
5,000% for content available for free through
an antenna.
Consumer Reports fought for the law as
part of a campaign it called “What the Fee?!”
aimed at requiring industries to disclose sur
prise fees and encouraging consumers to fight
back.
Consumers spend an average $450 a year in
extra fees imposed by TV and Internet provid
ers, estimated a report in October.
While some add-ons are taxes imposed by
local, state and federal governments passed
onto consumers, others are created by the pro
viders “for things that are nothing more than
a cost of doing business,” the October report
stated.
Examples include the so-called Broadcast
TV Fee, Regional Sports Fee, and Set-Top Box
Fee, the report said. Combined, the company-
imposed fees amount to a 24% surcharge on
top of the advertised price, the report said.
Consumer Reports estimated the fees could
be generating as much as $28 billion a year for
cable companies.
The new law wasn’t a grand slam for con
sumers and Consumer Reports. The House
version required disclosure of add-on fees
before consumers sign up. But the version
passed by the Senate shifts the disclosure
requirement to within 24 hours after sign-up,
according to the pay-TV industry watchdog
site FierceVideo.com.
Also, the law only applies to pay-TV provid
ers, and not internet service providers (ISPs).
Consumer Reports’ report points out that
while TV consumers can fight back by “cut
ting the cord” and relying on over-the-air and
streaming apps, “hidden fees are starting to
creep into ‘internet only’ service packages as
well.”
DREAMSTIME I Tribune News Service
Cable and satellite TV companies will have to be
upfront about how big new customers’ bills will
really be under provisions of a new law enacted
by Congress and the president this month.
Tesla sputtering; analyst sees sales falling short of targets
Musk
BY REX CRUM
The Mercury News
Tesla took a hit on Monday as
investors turned on the electric
carmaker after a Wall Street
analyst said he thinks the com
pany will miss its own vehicle
delivery targets for 2019.
Jeffrey Osborne, of Cowen
& Co., said in a research note
Monday that he expects Tesla
will report deliveries of 101,000
vehicles for the fourth quar
ter of the year when it gives
its quarterly delivery totals in
early January. That number
would be a record for vehicle
deliveries in a quarter for
Tesla, and would give the com
pany approximately 356,000
deliveries for this year.
Osborne’s forecast would
leave Tesla falling just a bit shy
of the 360,000 delivery target
that Chief Executive Elon Musk
said in October that he was
confident the company would
reach.
Osborne actually raised his
fourth-quarter delivery esti
mates for Tesla from his prior
forecast of 95,000 vehicles.
However, Osborne said that he
thinks the company will miss
its own delivery targets due
to weaker demand for Tesla’s
Model S and Model X vehi
cles. Osborne estimates Tesla
will report 15,000 combined
deliveries of those vehicles, as
compared to the company’s
forecast for 20,000 Model S and
Model X deliveries.
Tesla typically gives its
quarterly delivery report
within four days after the end
of a quarter, and several days
ahead of its full quarterly earn
ings and revenue results.
