Disney's purchase of Maker a boon for LA startups
LOS ANGELES (AP) — Disney's $500 million purchase of YouTube video producer Maker Studios is a sign that the entertainment industry's content and technology startups are coming of age and proving to be as valuable to Hollywood as app makers are to the giants of Silicon Valley.
The deal announced Monday also signals Hollywood's new openness to technological innovation, an acknowledgement that media giants don't have all the answers. The acquisition comes a month after The Walt Disney Co. launched a technology startup incubator called Disney Accelerator, which promises to seed 10 companies with $120,000 each to develop ideas that'll have a big impact on entertainment and technology.
Disney's purchase price — which could hit $950 million if Maker hits performance targets — also validates the increasing value of so-called "multichannel networks." Those are the mini media empires that provide funding and support to video creators while taking a cut of ad revenue generated from views on YouTube.
Risky IPO seeks new way to trade star athletes
SAN FRANCISCO (AP) — Professional athletes frequently get traded, but San Francisco 49er Vernon Davis is about to be the first ever to be traded like a stock.
Davis is serving as the litmus test for a risky concept: Whether sports stars should be treated like public companies, whose moneymaking potential can be bought and sold on an exchange by ordinary investors.
Fantex Inc. plans to operate the exchange and will orchestrate Davis' IPO after getting regulatory approval from the Securities and Exchange Commission.
The deal requires Fantex to pay Davis $4 million in exchange for 10 percent of his future earnings, including some of his off-field income. To cover Davis' fee, Fantex seeks to sell 421,100 shares of stock at $10 apiece. The company hopes to complete the offering in the next few weeks.
Toyota case shows it's hard to prosecute execs
WASHINGTON (AP) — Efforts to conceal the extent of dangerous car defects at Toyota Motor Corp. were so pervasive, prosecutors say, that an exasperated employee at one point warned that "someone will go to jail if lies are repeatedly told."
Yet no one has gone to jail, nor is likely to.
The Justice Department last week socked the car company with a $1.2 billion penalty but brought no criminal charges against individual executives, an unsatisfying resolution for consumer activists who say prison is the best deterrence for corporate malfeasance. But prosecutors say they had little choice, in part because of constraints with evidence and the challenge of gathering testimony and information from witnesses outside the United States.
US home prices dip in Jan. for 3rd straight month
WASHINGTON (AP) — U.S. home prices dipped in January for a third straight month, likely because of slower sales in recent months caused by cold weather, a limited supply of homes and higher mortgage rates.
The Standard & Poor's/Case-Shiller 20-city home price index, released Tuesday, declined 0.1 percent from December to January, the same drop as the previous two months. That figure is not adjusted for seasonal variations, so the dip partly reflects weaker winter sales.
The index rose a healthy 13.2 percent in January compared with 12 months earlier. But that is down from a 13.4 percent increase in 2013 and is the second straight decrease.
Consumer confidence rebounds in sign of optimism
WASHINGTON (AP) — U.S. consumer confidence has rebounded to the highest reading in six years, providing a further sign that the economy's prospects should brighten with warmer weather.
The Conference Board said Tuesday that its confidence index rose to 82.3 this month from a February reading of 78.3. It was the strongest reading since the index stood at 87.3 in January 2008, just as the Great Recession was beginning.
Conference Board economist Lynn Franco said consumers are moderately more upbeat about future job prospects and the overall economy, though less optimistic about income growth.
Consumer confidence is closely watched because consumer spending accounts for about 70 percent of economic activity.
Coast Guard reopens Houston Ship Channel to limited traffic after weekend oil spill
GALVESTON, Texas (AP) — The Coast Guard partially reopened one of the nation's busiest seaports to ship traffic Tuesday, three days after a collision between a barge and a ship spilled up to 170,000 gallons of tar-like oil into the waters south of Houston.
Authorities said ships were being allowed through the Houston Ship Channel after their assessment teams deemed it was clear enough for passage. More than 100 ships on both sides of the channel were awaiting the reopening.
The oil spill happened Saturday, when a barge carrying 900,000 gallons collided with a ship, leading to the closure of one of the nation's busiest seaports. Traffic through the channel includes ships serving refineries key to American oil production.
JP Morgan's 'Mr. Fix-it' is the latest departure
NEW YORK (AP) — JPMorgan Chase is losing another high-ranking executive, this time one who had been considered a possible successor to CEO Jamie Dimon. Michael Cavanagh, co-CEO of the company's corporate and investment bank, is joining The Carlyle Group to become co-president and co-chief operating officer.
Cavanagh, 48, joined the global bank in 2004 and helped guide it through the financial crises that washed over Wall Street years later.
Several other top executives have departed from JPMorgan recently. Charlie Scharf left in 2011 to run JPMorgan's private equity arm Equity Partners, and is now CEO of Visa. Heidi Miller left at the same time after running the company's international operations. Jes Staley, another potential CEO, left last year for BlueMountain Capital. And co-chief operating officer Frank Bisignano left in 2013.
Report: Payday loans can cost borrowers much
WASHINGTON (AP) — A new study found that about half of all payday loans are made to people who extend the loans so many times that they end up paying more in fees than the original amount they borrowed.
Payday loans, also known as cash advances or check loans, are short-term loans at high interest rates. They often are made to borrowers with weak credit or low incomes.
The report released Tuesday by the Consumer Financial Protection Bureau found that four of five payday borrowers either default on or extend a payday loan over the course of a year. Additional fees are charged when loans are extended or rolled over.
FCC: Thousands of hotels don't offer direct 911
DALLAS (AP) — Tens of thousands of hotels don't allow guests to directly reach emergency services when they dial 911, according to a national survey taken after a 9-year-old girl couldn't call for help while her mother was being stabbed to death in a Texas motel.
The incident spurred a petition demanding hotels and motels be required to enable the direct dialing of 911. Many hotels require callers to dial "9'' first or have some other system, such as calling first to the front desk, which advocates say can lead to panic and confusion in an emergency.
The American Hotel & Lodging Association survey found that about 45 percent of franchised hotels and motels and 32 percent of independent hotels have direct 911 dialing.
Birth control rule seems to divide Supreme Court
WASHINGTON (AP) — The Supreme Court struggled Tuesday with the question of whether companies have religious rights in a case challenging the Affordable Health Care Act and its guarantee of birth control in employees' preventive care plans.
As the court heard the challenge brought by the Hobby Lobby chain of stores and others, demonstrators on both sides of the issue chanted outside. The family-owned companies object to covering certain methods of birth control that they say can work after conception, in violation of their religious beliefs.
The justices have never declared that for-profit corporations, as opposed to individuals, can hold religious beliefs. The companies in this case, and their backers, argue that a 1993 federal law on religious freedom extends to businesses.
By The Associated Press=
The Dow Jones industrial average gained 91.19 points, or 0.6 percent, to close at 16,367.88. The S&P 500 rose 8.18 points, or 0.4 percent, to 1,865.62. The Nasdaq composite gained 7.88 points, or 0.2 percent, to 4,234.27.
Benchmark oil for May delivery fell 41 cents to close at $99.19 in midday trading in New York. Wholesale gasoline fell 0.4 cents to close at $2.882 a gallon. Heating oil rose 1.1 cents to close at $2.921 a gallon. Natural gas rose 13.5 cents to close at $4.411 per 1,000 cubic feet. Brent crude, used to set prices for international varieties of crude used by many U.S. refineries, rose 7 cents to close at $106.99 in London.