Archive for the ‘Happenings’ Category

Happenings – The Berlin Rock Star

August 1, 2008

Let’s play “Who am I ?”

I was born on a tropical island.

I spent some of my childhood in the United States.

Then I moved abroad with my single mother.

I have exotic good looks and magnetic charisma.

My “stage presence” is engaging beyond compare.

Fans (especially women) often faint at my events

I’ve been compared to other young “greats” who preceded me

An event in Berlin, Germany cast me onto the world’s stage.

The media adored me.

Who am I ?

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Answer

Of course, I’m Fabrice Morvan — formerly of Milli Vanilli. 

I was born in Guadalupe, moved to Miami, then moved to Paris with my single mother. 

I was modeling and breakdancing in Berlin when producer Frank Varian picked me and Rob Pilatus to become the duo fronting Milli Vanilli.  

We sold over 30 million singles, 14 million albums and became one of the most popular acts in the world. 

We played to packed venues and achieved worldwide adulation — including a Grammy.  

We were often compared to Bob Dylan, Elvis Presley, Paul McCartney, and Mick Jagger. 

Then, during a live MTV performance at the Lake Compounce theme park in Bristol, Connecticut, a playback  machine jammed. 

Only then did people realize that we were simply lip syncing recorded tracks.  While we put on a great show, we couldn’t sing. 

Fans were disappointed, we had to give back our Grammy, and our success turned to infamy as con artists. 

 “Our career came to a sudden and ignominious end: Fakers. Frauds. A blatant marketing scam. ”

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The nuns used to teach me that history repeats.  Hmmm … 

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Primary source: http://music.yahoo.com/ar-257262-bio–Milli-Vanilli

Additional background provided by Wikipedia – The Free Encyclopedia: – and official reference for settling Homa family bets  http://en.wikipedia.org/wiki/Milli_Vanilli

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Want more from the Homa Files?
 Click link =>  The Homa Files Blog

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Update: XM – Sirius Merger – Finally!

July 25, 2008

After more than a year of government review (largely instigated by a powerful “over the air” radio lobby led by the National Association of Broadcasters), it looks like the merger between XM Satellite Radio and Sirius Satellite Radio — is finally going to happen.

in March, the Justice Department approved the merger.  Last month (June), FCC Chairman Kevin Martin gave his ok, saying:  “I am recommending that with the voluntary commitments they’ve offered, on balance, this transaction would be in the public interest. They have voluntarily committed to setting forth price constraints, so the prices for consumers do not increase; smaller packages at lower prices; an open standard for radios; the sale of interoperable radios; and additional public interest programming for noncommercial use and for qualified entities who have not been traditionally represented.”

Two of the five FCC members commission quickly followed Martin’s lead and  announced that they would cast votes to approve the deal.

Now, their are reports that at least one of two other members of the FCC (John Adelstein, Deborah Taylor Tate), is ready give the merger the majority vote it needs provided that XM-Sirius up the ante by freezing prices for six years, by making 25% of their satellite capacity available for public-interest and minority programming, and by paying a $2o million fine for some minor technical violations of FCC transmission rules.

For more details:
http://online.wsj.com/article/SB121683130281477651.html

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Performance Update

The companies broke even financially, and ended the 1st quarter of 2008 with a total of almost 18 million subscribers — 9.33 for XM, 8.64 for Sirius. (Reminder: The original “Bass Model” research studies projected the market would be at least 25 million).

XM’s subscriber acquisition costs (SAC), a component of cost per gross addition (CPGA), were $73.  CPGA in was $99 for XM, $91 for Sirius

XM converted  53.3 percent of OEM installations (i.e. radios already installed in new cars)to subscriptions. XM’s monthly churn rate was 1.77 percent.

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TEST QUESTION: Given a monthly subscription price of $12.99,  what’s the customer life time value (CLTV) of an average satellite radio subscriber? Answer below

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Observations

1. The prolonged merger approval process — which took longer than the approval of the Exxon-Mobil merger — certainly validates the political clout of the “over the air” media companies.  To a reasonably objective person (me), this one was a no-brainer.

2. Finally, I’ll be able to get the NFL and MLB on the same service.

3. I still think that converting about half of the OEM units pre-installed in new cars is cause for concern, not celebration.  Any marketer worth his / her salt wouldn’t sleep well at night until the conversion ration was at least over 75%. 

4. My Lexus RX-350 didn’t come with either XM or Sirius pre-installed.  The dealer treated the installation as a minor annoyance, and said less than half of their customers opt for satellite radio..

5. Big question: too late to matter? My sense: the buzz is gone and momentum  is gone.  Your views?

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Next up: Back to taxes …

Want more from the Homa Files?
 Click link =>  The Homa Files Blog  

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Answer to CLTV Question:
Assuming nil marginal operating costs per customer (though there would be some), and a 5% annual discount rate ( .4% monthly):
CLTV = [MS$ / (C% + DR%)] – CGAC
MS$ = monthly subscription = $12.99
C% = churn rate =  .0177
C% + DR% = .0177 + .004 = .0217
[MS$ / (C% + DR%)]  = $12.99 / .0217 = $598.61
$598.61 – CGAC = $598.61 – $95 (avg for XM & SIRI) +
$503.61

Posted in Government & Politics, Happenings, Media, Uncategorized | 4 Comments »

Tunes – Chicago Live @ Wolf Trap

July 9, 2008

Most folks know that I’m a big Chicago fan — the city, the Bears, the 1st place Cubbies and — oh yeah — the rock band. 

As part of my Dad’s Day present, son Scott and daughter-in-law Jess made a wish of mine come true — finally, I got to see Chicago perform live.  WOW.  Two solid hours of hit after hit after hit. (Test: ask your friends how many Chicago songs they can name?  Bet you’ll be surprised)

Gotta hand it to a band that stays relatively intact for over 40 years, adapts to the constantly changing music scene, can still pack an outdoor venue, and acts like they really want to be there. 

There’s a lesson in there somewhere.

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Some Chicago::
You’re My Inspiration
Make Me Smile
Saturday in the Park
Feeling Stronger Everyday*
25 or 6 to 4
Only the Beginning
Hard to Say I’m Sorry
Old Days
Color My World
Wishing You Were Here

* Ken’s favorite

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Limits: Starbucks Wakes Up and Smells the Coffee

July 2, 2008

STAR dims as latte hits thirty BUCKS per gallon.

Starbucks announced that it is shuttering 500 more stores (the company announced 100 closings last month), cutting 12,000 jobs (7% of its 172K “partners”), and slowing new store development.

Excerpts from the Wall Street Journal (with my take):

WSJ: “The pullback is a sign that the Seattle-based coffee giant is continuing to see weak sales as high gas prices and other pressures on consumer spending prompt Americans to cut back on extras”.

KEH: Latte @ $3 per 12 ounce serving = $31.99 … ouch

WSJ: “Starbucks has been struggling to attract customers amid the slowdown in consumer spending and increasing competition from other coffee and restaurant chains, such as fast-food giant McDonald’s.”

KEH: McD’s wins taste tests and costs $2 / cup less … Hmmm … 

WSJ: “The company said it will eliminate as many as 12,000 full-time and part-time retail positions in connection with the closures; some baristas will get jobs at other stores … Workers will find out whether their store is closing by the middle of this month.”

KEH: Isn’t SBUX supposed to be the model of kumbaya HR management?  Worse than getting fired is being told that you’ll be told in a couple weeks.

WSJ: “Starbucks said the sites earmarked for closure include those that aren’t profitable at the moment or aren’t expected to provide the company with acceptable returns on its investment.

KEH: I guess that previously, unprofitable stores with low ROIs were just fine.

WSJ: “(SBUX is coming off a period of rapid expansion intended to ) to boost sales growth and siphon traffic away from some of its stores where long lines were driving away customers … company research showed people sometimes weren’t willing to cross the street to buy a cup of coffee.”

KEH: Not to pay $5 a cup, that is.

WSJ “But the density of Starbucks stores in places like New York and other large cities turned the chain into a symbol of ubiquity, spawning countless jokes. Last year, as Starbucks’s sales began to soften, it became clear that the company’s expansion was cannibalizing its sales in a way that was threatening the chain’s success, as well as causing the quality at its existing locations to slip”.

KEH It’s called “decreasing marginal returns” … or, simply “hitting the wall”

WSJ “(CEO Howard) Schultz has been pushing through changes, including the introduction of a new, milder daily brewed coffee that the company says has helped boost Starbucks’s drip-coffee sales. But, in doing so, he has alienated a small group of loyal Starbucks customers who prefer the strong coffees on which the chain built its reputation”.

KEH: Remember New Coke? 

KEH: Starbuck’s had a great run.  Welcome to the real world.

Posted in Happenings, KEH Points-of-View, Uncategorized | Leave a Comment »

News – Dog Overboard

June 30, 2008

Dateline:

Arnold, Maryland

June 30, 2008

9:30 a.m. EDT

 

A woman and two dogs were paddle boating in the Magothy River this morning.  One of the dogs – occasionally, but not dependably answering to the name “Captain” – nudged the other dog off the boat and into the crystal clear waters of the Magothy.  

 

The woman – identified as Kathy Homa was heard shouting, “Skipper, come”. But the overboarded dog – who is thought to be partially deaf – was dog paddling too hard to respond. 

 

Mrs. Homa tried to hoist the big,  black, water-logged mutt into the boat.  Her fundamentally flawed plan was predictably unsuccessful.  So, Mrs. Homa paddled like hell towards shore, hoping that Skipper would follow the boat  (rather than heading  off across the Magothy to Party Island). 

 

Skipper did follow the boat to shore and is back home, resting peacefully. 

 

Authorities  praised Mrs. Homa’s quick reactions.  No charges have been filed, but authorities said that they consider the circumstances to be “suspicious.”  They did a DPS-like canvass of the area with negative results and still consider Captain to be a “dog of interest” in their continuing  investigation.

 

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UPDATE July 2, 2008

 

Arnold authorites recovered a surveillance photo that clearly shows Skipper voluntarily jumping from the boat.  Captain has been cleared and is no longer considered a “dog of interest”.
 

                                       

 

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