Marketplace - American Public Media

How a $150 million investment turned into $3.3 billion

Wed, 2014-11-19 07:00

The Cystic Fibrosis Foundation has sold its royalty rights to a powerful game-changing drug that it helped fund and develop.

The national charity has flipped a $150 million dollar investment into a more than $3 billion dollar deal, a figure that’s more than 20 times the organization’s budget last year.

While the windfall means more money for research, the drug itself costs more than $300,000 and has been out of reach for some with this fatal disease.

Let’s face it, it’s a little unusual for national charities like the Cystic Fibrosis Foundation to team up with drug makers and start selling royalties.

But Dr. Ahmet Uluer of Boston Children’s Hospital says it’s good they did.

“Without this relationship this drug is not being developed. And we are maybe not where we are right now, looking at this ethical dilemma of pricing and availability to patients,” he says.

The question for some is whether the foundation has put its own health in front of people with this disease.

In Arkansas, Medicaid officials have denied the use of this treatment to three patients in part because the drug – Kalydeco – is so expensive.

University of Massachusetts’ Dr. Brian O’Sullivan says “this is a really thorny issue and certainly some of this money needs to go back to patient care and access to drugs.”

While Kalydeco helps a sliver of patients, O’Sullivan says the next generation of drugs could treat up to 50 percent, and they may be as expensive, so they may not be as effective.

That would mean lots of potential battles between the sick and insurers who are expected to pay the bill.

Vertex says it offers a patient assistance program to help cover costs. The company says virtually every patient who has been prescribed kalydeco in the U.S. has access to it.

 

L.A.'s the place for YouTube stars seeking wider fame

Wed, 2014-11-19 06:32

If you keep track of this stuff, you might have noticed quite a few YouTubers crossing over into the mainstream lately. They’ve landed network TV deals and spots on reality shows. Then there’s Michelle Phan, who spun her Internet fame into a line of cosmetics for L'Oreal.

The success of stars like Phan has inspired YouTubers like Meg DeAngelis to make the pilgrimage to Los Angeles – which is emerging as the center of YouTube entertainment business – in search of Internet gold.

A college dropout, DeAngelis started making videos in eighth grade when she was into gymnastics. Her early videos show her executing backflips and other tumbling moves. The videos are washed out, the sound is distant. They look like clips of a young girl just having fun.

“I started by posting videos that were like my hobbies,” DeAngelis says. “Stuff that wasn’t meant to be like a genre or a channel.”

But the videos got of tens of thousands of hits, and DeAngelis kept making them. She might have just kept posting videos as a hobby,  but things changed last year when she came to Los Angeles to visit a fellow YouTuber.

“She kinda took me around L.A., and I met so many other YouTubers,” DeAngelis says. “It was weird to me, too. And to find out they all live close to each other and hang out was really cool. I just wanted to be a part of that whole bubble.”

So DeAngelis dropped out of college in Florida and moved to L.A. to join a growing community of 20-somethings who are trying to make it as YouTube stars.

“I like putting an insane amount of music in it,” DeAngelis says, showing how she edits her videos. These days, her videos are far more polished and mostly about fashion. One shows DeAngelis modeling fall accessories that she made.

What does it mean to DeAngelis to “make it” as a YouTuber? Would it be a role on television or in a movie?  Being cast on reality TV, like Bethany Mota, who got on "Dancing with the Stars"? But DeAngelis says she’s not interested in acting  

“I really want to have a clothing line because so much of my show is about fashion,” she says.

For YouTubers, making those goals come true often starts at a place like Awesomeness TV, one of a growing number of multi-channel networks on YouTube.

Awesomeness is housed in a large converted warehouse in West L.A. Anybody can start a channel and post videos on the network, but at the same time, Awesomeness TV also creates original videos that feature YouTubers.

Jackie Koppel, the head of talent development, showed me around.

“So much of what we do is in-house,” DeAngelis says. “So we have editors, we have a production team, we have reality, the sales team.” KOPPEL?

When DeAngeles came to Awesomeness, she had about 250,000 subscribers, according to Koppel.

About eight months later, that number has grown to 1.3 million subscribers, Koppel says.

Awesomeness helped DeAngeles accomplish that by plugging her into its shows.

“We have her in a scripted show with Royal Caribbean, where she went on a cruise,” Koppel says. These “branded shows” are paid for by companies that want to promote their goods.

“And then we also have her in some of our more beauty-focused content like "Makeup Mythbusters," that’s a show she sorta helms,” Koppel says.

And remember, this isn’t to launch DeAngelis into an acting career but to get her a clothing line.

Many people mistakenly think of YouTubers as “talent” in the Hollywood sense of the word – as in actors, says Lisa Filipelli, a talent agent at Big Frame, an independent subsidiary of Awesomeness.

 

“They’re influencers, not talent,” Filipelli says. “Talent is a person who just shows up to set, and they do what they do and then they’re done.”

An influencer is someone who is constantly engaging with their audience — whether it’s on YouTube, Twitter, Instagram or Snapchat. And Filipelli says these influencers get their audience to talk about stuff and increasingly get people to buy stuff, too.

“There’s YouTubers on the New York Times best-seller list and selling out tours and selling massive amount of product in stores,” Filipelli says. 

YouTubers are disrupting almost every segment of the teen-consumer market, according to Filipelli. For example, instead of fashion magazines, teens are increasingly turning to YouTubers for beauty and fashion tips.

With more advertising money moving from television to video, that trend will accelerate, Filipelli says.

Back at DeAngelis’ apartment, she’s still waiting to make it. She won’t reveal how much she makes at Awesomeness, but says she mostly lives off her savings.

“When I was living with my parents I didn’t pay rent, and so I just saved a lot,” she says.

DeAngelis worked odd jobs and also made money off advertisements that ran on her YouTube videos. If she runs out of money, she’ll probably go back to college, she says. And while she’s hopeful about future opportunities, she is also aware that her time might be limited.

“I can’t do Vine, Snapchat or like any of the new apps, like I can only do Twitter and Instagram and the basic ones,” she says. “And it almost feels like I’m getting really old."

How old, exactly?

"I’m 19.”

YouTube Stars flock to LA to turn fame into gold

Wed, 2014-11-19 06:32

If you keep track of this stuff, you might have noticed quite a few YouTubers have crossed over into the mainstream lately. They’ve landed network TV deals and spots on reality shows. Then there’s Michelle Phan, who spun her Internet fame into a line of cosmetics for L'oreal.

The success of stars like Phan has inspired Youtubers like Meg DeAngelis to make the pilgrimage to Los Angeles, which is emerging as the center of YouTube entertainment business, in search of Internet gold.

DeAngelis is a college dropout who started making videos in the 8th grade when she was into gymnastics. DeAngelis’ early videos are of her doing backflips and other tumbling moves. The videos are washed out, the sound is distant. All in all, they just look like clips of a young girl having fun.

“I started by posting videos that were like my hobbies,” DeAngelis says. “Stuff that wasn’t meant to be like a genre or a channel.”

But the videos got of tens-of-thousands of hits and DeAngelis kept making them. She might have just kept making and posting videos as a hobby,  but things changed last year when she came to Los Angeles to visit a fellow YouTuber.

“She kinda took me around L.A. and I met so many other YouTubers,” DeAngelis says. “It was weird to me too. And to find out they all live close to each other and hang out was really cool. I just wanted to be a part of that whole bubble.”

And so DeAngelis dropped out of college in Florida and moved to L.A. to join a growing community of 20-somethings who’re trying to make it as YouTube stars.

“I like putting an insane amount of music in it,” DeAngelis says showing me how she edits her videos. We’re in the lobby of her apartment and these days, DeAngelis’ videos are way more polished and mostly about fashion. In the one she’s showing me, DeAngelis is modeling fall accessories that she made.

I asked DeAngelis what’s it mean to “make it” as YouTuber? Is it a role on television or a movie?  Maybe on reality TV, like Bethany Mota, who got onto Dancing with the Stars? But DeAngelis says she’s not interested in acting  

“I really want to have a clothing line because so much of my show is about fashion,” she says.

For YouTubers, making those goals come true starts at a place like Awesomeness TV, one of a growing number of multi-channel networks on YouTube.

Awesomeness is housed in a large converted warehouse in West LA. Jackie Koppel, the head of talent development, showed me around. Anybody can start a channel and post videos on the network. At the same time, Awesomeness TV also creates original videos that feature YouTubers like DeAngelis.

“So much of what we do is in-house,” DeAngelis says. “So we have editors, we have a production team, we have reality, the sales team.”

Koppel says when DeAngeles came to Awesomeness, she had about 250,000 subscribers.

“Just about 8 months later, she’s over 1.3 million subscribers,” Koppel says.

She says Awesomeness helped DeAngeles do that by plugging her into its shows.

“We have her in a scripted show with Royal Caribbean, where she went on a cruise,” Koppel says. These “branded shows” are paid for by companies that want to promote their goods.

“And then we also have her in some of our more beauty focused content like Makeup Mythbusters, that’s a show she sorta helms,” Koppel says.

And remember, this isn’t to launch DeAngelis into an acting career but to get her a clothing line.

Lisa Filipelli, is a talent agent at Big Frame, which is an independent subsidiary of Awesomeness. She says lots of people mistakenly think of YouTubers as “talent” like in the Hollywood sense of the word as in actors.

“They’re influencers, not talent,” Filipelli says. “Talent is a person who just shows up to set and they do what they do and then they’re done.”

An influencer is somebody who is constantly engaging with their audience — whether it’s on YouTube, Twitter, Instagram or Snapchat. And Filipelli says these influencers get their audience to talk about stuff and increasingly they’re getting people to buy stuff too.

“There’s YouTubers on the New York Times best seller list and selling out tours and selling massive amount of product in stores,” Filipelli says. 

And she says, YouTubers are disrupting almost every segment of the teen consumer market. For example, instead of fashion magazines, teens are increasingly turning to YouTubers for beauty and fashion tips.  Filipelli says with more advertising money moving from television to video that trend will accelerate.

Back at DeAngelis’ apartment, she’s still waiting to make it. DeAngelis won’t say how much she makes at Awesomeness, but she does say she’s mostly living off savings.

“When I was living with my parents I didn’t pay rent and so I just saved a lot,” she says.

DeAngelis worked odd jobs and also, made money off the advertisements that ran on her YouTube videos. She says, if she runs out of money, she’ll probably go back to college. And while she’s hopeful about the opportunities ahead, DeAngelis is also conscious that her time might be limited.

“I can’t do Vine, Snapchat or like any of the new apps, like I can only do Twitter and Instagram and the basic ones,” she says. “And it almost feels like I’m getting really old."

How old, exactly?

"I’m 19.”

For wannabe YouTube stars, L.A. is the place to be

Wed, 2014-11-19 06:32

If you keep track of this stuff, you might have noticed quite a few YouTubers have crossed over into the mainstream lately. They’ve landed network TV deals and spots on reality shows. Then there’s Michelle Phan, who spun her Internet fame into a line of cosmetics for L'oreal.

The success of stars like Phan has inspired Youtubers like Meg DeAngelis to make the pilgrimage to Los Angeles, which is emerging as the center of YouTube entertainment business, in search of Internet gold.

DeAngelis is a college dropout who started making videos in the 8th grade when she was into gymnastics. DeAngelis’ early videos are of her doing backflips and other tumbling moves. The videos are washed out, the sound is distant. All in all, they just look like clips of a young girl having fun.

“I started by posting videos that were like my hobbies,” DeAngelis says. “Stuff that wasn’t meant to be like a genre or a channel.”

But the videos got of tens-of-thousands of hits and DeAngelis kept making them. She might have just kept making and posting videos as a hobby,  but things changed last year when she came to Los Angeles to visit a fellow YouTuber.

“She kinda took me around L.A. and I met so many other YouTubers,” DeAngelis says. “It was weird to me too. And to find out they all live close to each other and hang out was really cool. I just wanted to be a part of that whole bubble.”

And so DeAngelis dropped out of college in Florida and moved to L.A. to join a growing community of 20-somethings who’re trying to make it as YouTube stars.

“I like putting an insane amount of music in it,” DeAngelis says showing me how she edits her videos. We’re in the lobby of her apartment and these days, DeAngelis’ videos are way more polished and mostly about fashion. In the one she’s showing me, DeAngelis is modeling fall accessories that she made.

I asked DeAngelis what’s it mean to “make it” as YouTuber? Is it a role on television or a movie?  Maybe on reality TV, like Bethany Mota, who got onto Dancing with the Stars? But DeAngelis says she’s not interested in acting  

“I really want to have a clothing line because so much of my show is about fashion,” she says.

For YouTubers, making those goals come true starts at a place like Awesomeness TV, one of a growing number of multi-channel networks on YouTube.

Awesomeness is housed in a large converted warehouse in West LA. Jackie Koppel, the head of talent development, showed me around. Anybody can start a channel and post videos on the network. At the same time, Awesomeness TV also creates original videos that feature YouTubers like DeAngelis.

“So much of what we do is in-house,” DeAngelis says. “So we have editors, we have a production team, we have reality, the sales team.”

Koppel says when DeAngeles came to Awesomeness, she had about 250,000 subscribers.

“Just about 8 months later, she’s over 1.3 million subscribers,” Koppel says.

She says Awesomeness helped DeAngeles do that by plugging her into its shows.

“We have her in a scripted show with Royal Caribbean, where she went on a cruise,” Koppel says. These “branded shows” are paid for by companies that want to promote their goods.

“And then we also have her in some of our more beauty focused content like Makeup Mythbusters, that’s a show she sorta helms,” Koppel says.

And remember, this isn’t to launch DeAngelis into an acting career but to get her a clothing line.

Lisa Filipelli, is a talent agent at Big Frame, which is an independent subsidiary of Awesomeness. She says lots of people mistakenly think of YouTubers as “talent” like in the Hollywood sense of the word as in actors.

“They’re influencers, not talent,” Filipelli says. “Talent is a person who just shows up to set and they do what they do and then they’re done.”

An influencer is somebody who is constantly engaging with their audience — whether it’s on YouTube, Twitter, Instagram or Snapchat. And Filipelli says these influencers get their audience to talk about stuff and increasingly they’re getting people to buy stuff too.

“There’s YouTubers on the New York Times best seller list and selling out tours and selling massive amount of product in stores,” Filipelli says. 

And she says, YouTubers are disrupting almost every segment of the teen consumer market. For example, instead of fashion magazines, teens are increasingly turning to YouTubers for beauty and fashion tips.  Filipelli says with more advertising money moving from television to video that trend will accelerate.

Back at DeAngelis’ apartment, she’s still waiting to make it. DeAngelis won’t say how much she makes at Awesomeness, but she does say she’s mostly living off savings.

“When I was living with my parents I didn’t pay rent and so I just saved a lot,” she says.

DeAngelis worked odd jobs and also, made money off the advertisements that ran on her YouTube videos. She says, if she runs out of money, she’ll probably go back to college. And while she’s hopeful about the opportunities ahead, DeAngelis is also conscious that her time might be limited.

“I can’t do Vine, Snapchat or like any of the new apps, like I can only do Twitter and Instagram and the basic ones,” she says. “And it almost feels like I’m getting really old."

How old, exactly?

"I’m 19.”

Quiz: How the recession affected college completion

Wed, 2014-11-19 04:04

More students enrolled in college for the first time in 2008 than ever before, but the completion rate for those students declined, according to the National Student Clearinghouse Research Center. Its recent report tracks the postsecondary progress of students who entered college at the start of the recession.

How many college students who started in 2008 received a degree or certificate within six years?

PODCAST: I want a pony!

Wed, 2014-11-19 03:00

The Cystic Fibrosis Foundation announced Wednesday they've sold royalty rights to a powerful new drug it funded and helped develop. The payout, $3.3 billion, is 20 times last year's budget for the organization, and it dwarfs the money the nonprofit originally gave toward the development of the drug. More on that. And the Carnival Corporation, which owns Carnival and Princess Cruise lines among others, is starting a new social media campaign next week to drum up business from people who've never taken a cruise before. Now, there's an online ad contest, a Twitter campaign, and more designed to change the conversation from norovirus outbreaks on ships or ships that sink. Plus, the government says the cost of raising a child to age 18 in America is up 2 percent to $245,000 this year. What that statistic leaves out, however, is what happens if that child asks for a pony for a birthday or the holidays. This week, we're collaborating with the New York Times on on something called "A Guide to Buying Just About Anything."

Target tries to be cool

Wed, 2014-11-19 02:00

It's been almost a year since the data breach that sent some Target customers packing. And Target, which reports earnings Wednesday, is trying a number of strategies to get them back.

For one, it has a new CEO, Brian Cornell. And he’s not above admitting the company has problems. He says Target needs to be cool again.  

“What does it mean to be Target in today’s retail landscape?” says Amy Koo, a senior analyst at Kantar Retail. She says Target is trying to beef up customer service. “They’re doing beauty advisers, they’ve expanded to do baby advisers. You know, ask us if you need help.”

Target is also experimenting with smaller stores in cities.

One experiment that didn’t go so well? Opening stores in Canada. Canadians complained about the prices, and shortages of popular products. Some analysts are weighing whether Target should close those stores.

“If they can’t get it to be a profitable venture then they’re going to do what’s best for the shareholder,” says Sean Naughton, senior research analyst at Piper Jaffray.

Naughton has already calculated how much it would cost Target to pull out of Canada: about $1.2 billion.

Carnival Corp. aims for a new set of customers

Wed, 2014-11-19 02:00

Carnival Corp., which operates nine cruise lines worldwide, plans to launch an online social media campaign next week which it says is aimed at people who are new to cruising.

The plans include a Twitter campaign with the hashtag #LoveCruising and an online ad contest on its new website.

The cruise line shook up its management in 2013 after several high-profile incidents, the biggest of which were the Costa Concordia disaster in which 32 people died and the stranding of the Carnival Triumph at sea after an engine fire. Many of the headlines for the latter incident read "Poop Cruise."

Just last week, Carnival suffered more bad headlines with news of 172 passengers sickened with the norovirus on one of its ships.

In the aftermath of the Concordia and Triumph disasters, Carnival said it expected its image recovery to take two to three years. But Ken Jones, VP of Corporate Marketing for Carnival Corp., insisted that this latest online campaign is not intended to fight negative headlines.

“This campaign is not designed to combat any particular press that’s happened in the past. This campaign is designed to speak for the fact that, for the first time ever, as a corporation, we’re talking about all nine of our brands simultaneously,” said Jones.

The campaign’s efforts are to introduce new customers to its various lines which cater to differing types of customers, Jones said. To that end, the company’s new online website will include a “Cruise-a-nality” interactive tool.

Mitch Joel, president of the digital marketing firm Twist Image, said Carnival’s plans, specifically in terms of the Twitter hashtag, are “not only risky, but I don’t even understand why they would even engage in this.”

Joel said companies that run online campaigns need to know the answers to some crucial questions ahead of time. "Do people really, really care and really want to help us? Or are they going to turn this into a parody and a joke, and make matters a whole lot worse for us,” Joel said.

"There are times that you can do it, if there is strong brand affinity,” said Don Stanley, an online marketing consultant and professor at the University of Wisconsin.

But the Internet is littered with online campaigns that miscalculated, such as a failed McDonald’s hashtag campaign two years ago or a Home Depot tweet that led to apologies from the company.

"The biggest mistake I see companies make is they think through the potential benefits of a campaign, but they don’t plan for potential problems,” said Stanley.

Carnival’s Jones said they’re confident of their Twitter campaign, although they will “curate” the tweets. 

“We’re confident in the cruise public. From what we know they like to speak up about cruising, and we’re excited to hear what we hear,” Jones said.

Counting up votes for NSA reform

Wed, 2014-11-19 02:00
58-42

That was the final vote in the Senate Tuesday, striking down broad reform of the National Security Administration by two votes. The bill would have stopped the bulk data collection exposed by former NSA contractor Edward Snowden last year, and it had bipartisan and White House support. Ultimately a divided Republican opposition—some thought the reforms went to far, others wanted them to go further—gathered enough votes to strike down the proposal, Politico reported. The bill is unlikely to come up for debate or vote before Republicans take over the Senate.

172

That's the number of passengers stricken with a norovirus just last week on a Carnival cruise. Reacting to the latest in a series of high-profile incidents, some fatal, Carnival Corp. is attempting to repair its image with a social media campaign.

$2 billion

The average cost of lost tuition after sexual assault, per college graduating class nationwide, the Washington Post calculated by estimating one in 50 victims misses a semester. A blog post explores the many hidden costs to students who were assaulted, from tuition to lost wages to moving costs to counseling.

$3.3 billion

The Cystic Fibrosis Foundation is set to announce on Wednesday the sale of rights to royalties for drugs it invested in 15 years ago. The initial investment was met with some skepticism: $150 million given to a biotechnology company to develop drugs to treat the disease. But as the New York Times reports, Wednesday's sale will bring in $3.3 billion, which is "20 times the foundation's budget for last year."

1/3 of a horse’s value

That's how much is generally charged in leasing a horse for a year. It's a lot of money when you consider that at a a place like Echo Farm, owner Callie Kuntz-Bauer has horses that range in value from $2,500 to $50,000. And that's just the beginning of the costs you end up paying in taking care of a horse.

U+1F4A9

Not technically a number, but that's unicode designation for the little pile of poo emoji. Special characters and emoticons all have a special designation to keep them consistent across all platforms. Companies have to design the icons themselves and - at least in Google's case with the poo - hide the emoji behind special commands. A new oral history from Fast Company explores not just the story of the poop symbol, but emoji's global appeal and standardization.

Paying for upgrades under the tray-table

Tue, 2014-11-18 13:50

Flying is not what it used to be. What was once glamorous now feels like walking through a mall to get to a cattle chute. Airlines are expanding first class and squeezing coach passengers into tighter quarters. Every spare inch of space and every service from bag-checking to expedited security has a price.

So on a recent trip from Los Angeles to Chicago, I decided to try for my own upgrades. At every opportunity, I discreetly offered cash to airline employees, Transportation Security Administration employees and fellow passengers in exchange for a better seat or faster service. I wanted to know what would happen when institutional fees leave the institution and were offered instead on the black market.

I started at the United Airlines ticket counter, offering the agent a $20 bill for a seat upgrade. She refused, acting as though this kind of thing happened all the time. She pointed to a seat map on the screen. “This is the only upgrade I have,” she said. “It’s $85.” At security, I tried to slip a couple of twenties to the officer at the T.S.A. PreCheck line so I could breeze through. He gave me a look that said, “Nice try,” and pointed to the long line of people inching toward the body scanners.

Once I got to the gate, I approached the passengers in the roped-off section for premium fliers. I went down the line, one by one, offering cash for their seats. One man shook his head, barely looking up from his phone. Another appeared confused. I had to explain that I wasn’t trying to get on the plane; I had a seat in coach. He declined. “I’ve got to get some work done,” he said.

Nearly everyone seemed bothered by my offer. The closest I got to a yes was with a couple who did not want to split up for the flight; otherwise, they might have considered it.

On the plane, I could not persuade anyone in a seat with extra legroom to switch places for money. I was surprised; I said I was willing to go as high as $100 and told them I needed to sit close to the front to exit quickly once we landed.

Perhaps I appeared a little suspect to some people. I have a bushy beard and long hair. I could pass for a young Cat Stevens in the right light.

But I did talk to Debbie, a flight attendant who was not on my flight but who observes the behavior of hundreds of passengers every day. Debbie, who asked that I not use her last name, was a social worker at a mental hospital before becoming a flight attendant. “So I was used to working with unpredictable people,” she said, “and I was actually kind of surprised at the general rudeness and lack of caring about other people that I saw in passengers on planes when I first started.”

Now she’s used to it. She wasn’t surprised that no one took my offer of cash for a seat. She sometimes has trouble getting passengers to switch seats to accommodate families, even when she offers free drinks and a seat that isn’t a downgrade.

Once, while Debbie was flying off duty, the pilot announced that an emergency landing was needed. “The working flight attendants wanted to move me up front so that I could help with an evacuation if it was necessary,” she said. The crew asked first-class passengers if one of them would give up a seat for her, but none were willing to move. “Luckily we didn’t need to evacuate,” Debbie said. “But it was interesting that nobody wanted to move, even when a flight attendant is saying ‘This will help save your life.’”

I also ran my experiment by Tom Bunn, a former airline captain (whose employers included United) and a licensed therapist. He, too, was not surprised by the reactions I got, but for different reasons.

For many people, he said, the act of flying is incredibly stressful. It is not so much because of long security lines and cramped seats, but because of the psychological act of giving up control, of leaving solid ground. Settling into an assigned seat, he said, is part of the process of quieting their anxiety. “So any change they have to face, they would rather not face it,” Mr. Bunn said. My cash offer may not have been enough to justify restarting that process of calming themselves.

My own theory is that people considering my offer may have been afraid that they would be breaking a rule and could be kicked off the plane as a result. Recently, a group of ultra-Orthodox Jewish men traveling from New York to Israel caused a flight delay when they refused to sit next to women for religious reasons. Many of the men offered passengers money to exchange seats, which, it turns out, is not against many airlines’ policies.

I contacted six airlines, including United, to ask about their policy regarding passenger-to-passenger transactions. Delta, United, American and Spirit responded. Delta and American said they had no policy that forbade passengers from exchanging seats for money. Spirit forbids only switching to an exit row or to larger front seats, the airline’s first-class equivalent.

Rahsaan Johnson of United said it was against company policy for employees to take money from a customer in exchange for a favor. But United does not have a policy against customers exchanging money for seat swaps. “Seat assignment is not specifically prohibited at this point. Changing cabins is,” Mr. Johnson said. So, for example, if you are in coach, you cannot switch with someone in first class.

Of all the upgrades I tried to get, only one could have landed me in any real trouble: offering cash for access to T.S.A. PreCheck. “That’s not how the program works,” said Ross Feinstein, T.S.A.’s press secretary. “Bribing a federal employee, I believe, is illegal.”

It does however, seem to be legal to buy your way to the front of the T.S.A. line. “The actual T.S.A. process begins where someone checks your ID,” Mr. Feinstein said. Before that point, anyone ahead of you in line is fair game for an offer.

Pricing a child's plea for equine ownership

Tue, 2014-11-18 13:01

In third grade, Amanda Ferrara persuaded her parents to let her take horse-riding lessons. She had always loved animals, and her parents, both Bronx born but living in a rural part of Westchester County, N.Y., agreed. Nine years later, her family owns one horse and leases two more.

She says she loves the pursuit and spends six days a week at the barn that boards the horses, taking the bus there after school and staying until dark, often doing homework or eating at the barn. Yet her afternoons are not spent entirely on horseback. For every hour she rides, she spends two to three hours getting her horse ready and cooling him down. “It’s my entire life now,” Amanda, 17, said.

When children express a desire for a pony, obliging parents in urban and suburban areas often vow that they will find a middle-class horse that will not cost more than a car (or a mortgage) payment. It is not easy, though it may not be impossible.

The Ferrara family boards all three horses — Cookie, Teddy and Rubio — at Echo Farm in South Salem, N.Y., which charges $1,300 a month per horse. That includes hay and grain, cleaning the stall and turning the horse out into the field every day.

At least the animals make the expense of boat ownership look reasonable.

Still, despite the cost, parents think the experience is worth it. They typically insist that horses provide deep life lessons in being responsible and caring for something that goes beyond themselves — or how well the animal can jump a fence.

“They’re learning a lot of responsibility at a young age,” said Callie Kuntz-Bauer, owner of Echo Farm. “You have to give up a lot of your social life. You can’t go out and party if you have a 6 a.m. horse show.”

So when children ask for a pony, what are parents to do? They would save a lot of money by steering the child toward another sport. But those parents who want to cultivate their children’s interest need to consider recurring costs that can continue for 30 years or more, long past the time when a child will be riding the horse.

Owners should expect the total spending for the animal’s upkeep to be far greater than the cost to buy it. “The real price is the monthly expenses,” said Carleton Henrich, a mother of four who grew up on 250 acres in southern Virginia.

Henrich recently bought a 5-year-old thoroughbred named Emery. A giant at 17 hands high (5 feet 8 inches at the withers), Emery is for her and her three daughters. (Her son is less interested.)

“He’s a big teddy bear,” she said, giving Emery a peppermint.

Henrich negotiated a two-week trial period to get a sense of the horse’s demeanor. But even during that period she had to have insurance to cover anything that might happen to him. She, like many owners of expensive horses, now has mortality insurance and medical coverage for the animal, which typically costs 3 percent of a horse’s value per year.

Even minor injuries can be costly in time as well as money. Amanda Ferrara said an injury a couple of years ago confined Cookie to his stall for six months. It took six more months for him to get back in shape. But at that point Amanda couldn’t jump with him anymore, so now her family just rides him for recreation.

Leasing a horse generally saves a family only on the upfront cost of buying one. Kuntz-Bauer said that a full lease of a horse is typically one-third of the horse’s value a year. The horses in her barn range in value from $2,500 to $50,000. And people who lease a horse usually take over all the responsibilities and ensuing costs as if they were the owner. A partial lease could spread the costs across multiple owners, but it also reduces riding time.

The list of expenses doesn’t end with room and board. Entry fees for competitions range from $500 for a one-day event to $3,000 to $6,000 for five-day events where the horses have to be transported, boarded and fed, Kuntz-Bauer said. There are also Interscholastic Equestrian Association events where competitors ride the horses at the host barn and don’t need their own horse to compete.

A veterinarian to assess a horse’s initial fitness will cost $1,500 to $2,000. Kuntz-Bauer said annual shots will run about $400. There are costs for dental visits and new shoes, too.

And some costs can rise rapidly.

Rachel Kosmal McCart, a lawyer specializing in horse issues in Portland, Ore., said local hay to feed horses in her area rose from $1 a bale 11 years ago to $5 a bale today. “People who were used to paying very little to feed their horses suddenly couldn’t afford to feed them,” she said.

Incidentals include saddles, bridle and blankets, as well as riding clothes and boots. Used gear is available, too; Georgina Bloomberg, a champion equestrian and daughter of the former New York City mayor, runs the Rider’s Closet to help make the clothes more affordable.

Not all areas are as expensive as Westchester County or other horsy enclaves filled with well-heeled parents and high land costs. Outside Portland, Ore., for example, it would cost $600 a month to board a horse.

In most areas, even wealthy ones, there are also opportunities simply to take lessons or buy time to ride. 

Horse clubs can defer costs further and still teach valuable lessons. In New Canaan, Conn., the New Canaan Mounted Troop aims to teach equestrian skills to children ages 7 to 17. The annual cost of $4,350 is not cheap, but it covers one lesson and one barn day per week during the school year.

The group started out as part of the Junior Cavalry of America, a sort of Girl Scouts on horseback, but today it functions like an equine version of Zipcar: Cadets can ride any of its 27 horses, all donated, as long as they have the ability.

But Margot Tucker, the student leader of the troop, said she got the most out of the barn days, when students help care for the horses. “If I could ride every day that would be awesome,” she said. “But what I really like about it is being part of the community. It’s the friendships we have.”

Those are the learning experiences that parents want their children to absorb from horses or any other activity.

This story is part of a collaboration between Marketplace and The New York Times called “A Guide to Buying Just About Anything.” 

Regaining control of your online data

Tue, 2014-11-18 12:18

When a strange man knocked on her door three years ago, Susan Manion decided to do more to protect her private information. As a musician in Northern Illinois, she was used to people getting in touch. But her work had started to draw unwanted attention.

“It wasn’t a stalker,” says Ms. Manion. She thinks the man wanted to collaborate, but her doorstep was the wrong place. “We didn’t want something like that happening again. It creeped me out.”

Ms. Manion signed up for DeleteMe, a service from a company called Abine. Abine promises to “remove your public profile from leading data sites.” Your public data profile can include photos of your house or family, your address and contact information. Ms. Manion has paid for Abine’s service for two years and says her home address and phone number are less likely to pop up in search results.

Nearly 25 years after the first publicly viewable website appeared, the culture of sharing on the Internet is changing. Privacy and anonymity are crucial features of new social apps like Secret, Whisper and Canary. A growing number of websites also offer services that help protect, maintain or even erase what is fast becoming your most permanent and accessible record: data that can be gleaned about you from search engine results.

These businesses are responding to what they see as evolving consumer interest. This month, a report by the Pew Research Center’s Internet and American Life Project found varying attitudes around privacy but a consensus around the challenges of managing personal information online.

“There’s this overwhelming sense that consumers feel they’ve lost control over the way their data is used by companies,” says Mary Madden, a senior researcher at Pew.

That is exactly what people like Rob Shavell, Abine’s chief executive, are banking on. When Mr. Shavell and his co-founders started the company in 2009, financing was not easy to find. Investors didn’t think young users cared about privacy. But Mr. Shavell said that in the last six months, Abine has faced more competition than in its first four years.

“That exact group that investors told us would never care, they’re moving from Facebook to Snapchat,” Mr. Shavell said, referring to the app that allows users to send each other messages that disappear right after delivery. “They do all kinds of things to make sure they’re managing their online identities in such a way that it’s not going to have so many negative ramifications.”

Other data companies are pivoting. MyLife.com began as Reunion.com in 2002, helping users connect with old classmates and friends. Then Facebook happened.

“As Facebook became so popular, we realized there wasn’t as much of a need for our services,” said Jeffrey Tinsley, the company’s chief executive. “So we looked for other opportunities.”

That road has had bumpy stretches. The firm was criticized for mining the email address books of some of its 52 million users for new customers. Mr. Tinsley realized the script on privacy had flipped. So he changed his business model to helping users try to manage their public data online.

“Three years ago, 75 percent of our revenue was public profile stuff and maybe 25 percent was helping people take it down,” he said. “Now it’s the exact opposite.”

To deliver for their customers, subscription services like Abine and MyLife use organized, repeated pressure. They go to top data broker websites like Spokeo.com, which collects information, then creates and sells profiles on consumers. They fill out removal forms on behalf of users. But the result is never a full cleanup.

“The options for getting facts and personal information removed once it’s been posted online in the U.S. are fairly limited,” says Christopher T. Bavitz, managing director of the Cyberlaw Clinic at Harvard Law School. “It’s very challenging to regulate the spread of this kind of information, but it’s challenging for very good reasons. The first good reason is the First Amendment.”

Users’ control over information has fared better in Europe after a May ruling from the European Court of Justice on the so-called right to be forgotten. That allows users to petition search engines to remove outdated or incorrect information about them. Google reports receiving 163,000 requests and approving 41 percent.

A growing chorus of voices is worried that the emergence of paid services that promise to clean up data could result in another case of the haves and have-nots. Ryan Calo, an assistant law professor at the University of Washington, said many states sold, rented or granted access to criminal records and other information to third-party data brokers.

“If a juvenile commits a crime but doesn’t reoffend, they might have the right to get the state’s record sealed or expunged,” Mr. Calo said. “But the user doesn’t have the same right to access when it comes to the data broker.”

Mr. Calo worries that these sorts of arrangements disproportionately affect populations that cannot afford to pay even once, let alone for the subscription fee that many services charge.

If you ask Philip R. Zimmermann whether money can buy back privacy, he will laugh and point to a paradox. If money is no object, he said, you are too famous to escape the Internet anyway. Mr. Zimmermann created Pretty Good Privacy, or P.G.P., a widely used email encryption program, in 1991. He now runs Silent Circle, a company that promises encrypted communication and offers the $629 Blackphone, a smartphone that features a custom operating system and applications.

Silent Circle tries to protect a user’s privacy out of the gate, instead of acting as a cleaning service. Encryption can make it more difficult for your data to be mined and published around the web. When it comes to cleaning up information that is already public, however, Mr. Zimmermann recalled the plutonium contamination at the Rocky Flats Plant nuclear weapons facility in Colorado.

“It gets into the soil,” he said. “If you’re a person that’s not of any interest to anyone, then maybe your information exists only on a couple of servers. Maybe. But once it’s out, it’s pretty hard to get it cleaned up. You can’t put toothpaste back in the tube.”

This story is part of a collaboration between Marketplace and The New York Times called “A Guide to Buying Just About Anything.” 

ClassDojo learns lesson in protecting student data

Tue, 2014-11-18 11:02

While the rows of education apps crowing teachers’ iPads are meant to help manage a classroom, there is increasing concern about the management of student data tracked in those apps.

Following an article published Monday in the New York Times, the founders of education app ClassDojo announced an update Tuesday regarding student privacy and data collection. Beginning next January, ClassDojo will start storing student profiles for only one year.

ClassDojo is a classroom tool designed to help teachers improve student behavior. Teachers can award positive and negative feedback points for behavior in class in real-time, using a smartphone or laptop. Parents, students and teachers can then engage with the data generated by the app.

A screenshot of a demo ClassDojo class shows how students can receive points for positive behavior.

 Manoj Lamba, marketing lead at ClassDojo, said unless a parent chooses to save their child’s information, the individual profile will now delete at the end of school year. He said the plan was already in the works, but it was "a no-brainer to announce it today."

In the post "What the New York Times got wrong," co-founders Sam Chaudhary and Laim Don responded to concern the data from their app could become part of a student's permanent record: 

"If students or their parents don’t save their ClassDojo profiles within that school year, we’ll permanently delete that data. If teachers want to keep data for longer than that, they can invite parents and students to save their ClassDojo profiles."

Lamba also said he thinks the company should have taken this step earlier. ClassDojo currently serves more than 2.5 million teachers. With this change, parents and students will now know about — and own — any lasting data that exists about a student.

However, the official privacy policy was last updated Oct. 24, 2014, so the promise of data deletion exists only as a promise, for now. ClassDojo claims they are the only education technology company to implement such a "pro-user" privacy policy, and said in Tuesday's announcement they will be making a more formal statement about the upcoming changes soon.

Why Uber execs may get away with their bad behavior

Tue, 2014-11-18 11:00

Uber has become known for questionable corporate behavior. The latest example is an incident in which a senior executive at the company suggested spending a million dollars to investigate the personal lives of journalists, in particular one female reporter who’s been critical of the company.

But will the bad behavior affect the company’s bottom line?

Robert Sutton, a professor of management science and engineering at Stanford University, says it's unlikely and consumers don't seem unduly concerned. But Karen North, a clinical professor at the USC Annenberg School of Communications, thinks Uber’s profits could suffer if the company burns through the trust it has built with customers.

Why Uber execs' bad behavior likely won't be punished

Tue, 2014-11-18 11:00

Uber has become known for questionable corporate behavior. The latest example is an incident in which a senior executive at the company suggested spending a million dollars to investigate the personal lives of journalists, in particular one female reporter who’s been critical of the company.

But will the bad behavior affect the company’s bottom line?

Robert Sutton, a professor of management science and engineering at Stanford University, says it's unlikely and consumers don't seem unduly concerned. But Karen North, a clinical professor at the USC Annenberg School of Communications, thinks Uber’s profits could suffer if the company burns through the trust it’s built with customers.

Does Keystone even matter anymore?

Tue, 2014-11-18 11:00

Today’s top political story is, by all appearances, a top environmental story: a Senate vote to authorize the controversial Keystone XL pipeline, which would carry hundreds of thousands of barrels of crude from the Canadian tar sands to the Gulf of Mexico. The fight against Keystone has been a marquee battle for the U.S. environmental movement for years. However, after all these years, the stakes may have gotten lower. 

The fight against Keystone was primarily about preventing climate change. "Crude oil from the oil sands is a lot more carbon intense," says Jim Krane, an energy-studies fellow at Rice University’s Baker Institute for Public Policy. Just extracting the stuff emits more carbon than extracting other crudes, Krane says, and it throws off extra carbon when burned as well.

The hope was blocking Keystone could prevent this type of crude from getting to market. But in the years Keystone has been debated, that train has left the station. Literally. Without a pipeline, rail has emerged as the crude's route to market. 

"It’s being transported now by train, down to Vancouver, it’s being put on tankers, and it’s shipped over to Asia," says Keith Brownsey, a political scientist at Mount Royal University in Alberta, Canada. "Bingo, there you go."

The original pro-Keystone argument has also lost a lot of steam. That was “energy independence for North America,” which fracking has made a less-urgent concern.

But for Brownsey, putting the oil in a pipeline now matters for a new reason.

"Rail is exponentially more dangerous than transmitting it by pipeline," he says.  In other words: pipelines don’t derail.

Opponents say the pipeline remains important, if mostly as a symbol. 

"It’s kind of like the polar bear," says Andrew Weaver, a climate scientist at the University of Victoria and a Green Party legislator in British Columbia. "Keystone has become that iconic image of: 'If we can’t force change here, where can we force change?'"

Networks battle for morning supremacy, young viewers

Tue, 2014-11-18 11:00

Just a few months ago, NBC brought in hotshot young programmer Jamie Horowitz from ESPN to help turn around "Today." Now he's already out. Meanwhile, the show is struggling to hold on to viewers and regain its No. 1 spot in the morning news ratings, which it lost to ABC’s "Good Morning America" in 2012 after 17 years on top.

The battle for ratings — and for younger viewers — can be seen in the shows’ daily lineups.

"Good Morning America" had rapper Lil Jon on Tuesday, getting host George Stephanopoulos to bust some (awkward but good-natured) moves to "Turn Down for What."

At rival NBC on Nov. 17, "Today Show" host Matt Lauer had Anglo-Irish boy-band One Direction on stage. Band member Zayn Malik was missing, and Lauer asked: “Is it something more serious than just a minor illness? There have been rumors of substance abuse. What’s going on?”

The band addressed the question, attributing Malik's absence to a "stomach bug." But the audience booed and younger viewers slammed Lauer on social media. “Those are the people they need to grow the 'Today Show' audience,” says Jim Hill, an entertainment writer and blogger. “And here Matt has managed to drive a whole generation away.”

Brian Steinberg, TV editor at Variety, says ABC has nailed the morning formula.

“‘Good Morning America’ knows who it is,” Steinberg says. “It’s single-minded. It’s an entertainment show with a little news thrown in. ‘Today’ is a little more of a split personality. They want to be a news show but they also want to entertain and have the same kind of fun. And sometimes it’s hard to pivot.”

Networks battle for morning supremacy

Tue, 2014-11-18 11:00

NBC brought in Jamie Horowitz from ESPN just a few months ago to help turn around "Today." Now he's out. Meanwhile, the show is struggling to hold on to viewers and regain its No. 1 spot in the morning news ratings, which it lost to ABC’s "Good Morning America" back in 2012 after 17 years on top.

The battle for ratings — and for younger viewers — can be seen in the shows’ daily lineups.

"Good Morning America" had rapper Lil Jon on Tuesday, getting host George Stephanopoulos to bust some (awkward but good-natured) moves to "Turn Down for What."

On November 17, at rival NBC, "Today Show" host Matt Lauer had Anglo-Irish boy-band One Direction on stage. Band member Zayn Malik was missing, and Lauer asked: “Is it something more serious than just a minor illness? There have been rumors of substance abuse. What’s going on?”

The audience booed and younger viewers slammed Lauer on social media. “Those are the people they need to grow the "Today Show" audience,” says entertainment writer and blogger Jim Hill. “And here Matt has managed to drive a whole generation away.”

Brian Steinberg, TV editor at Variety, says ABC has nailed the formula.

“‘Good Morning America’ knows who it is,” Steinberg says. “It’s single-minded. It’s an entertainment show with a little news thrown in. ‘Today’ is a little more of a split personality. They want to be a news show but they also want to entertain and have the same kind of fun. And sometimes it’s hard to pivot.”

Uber's data makes a creepy point about the company

Tue, 2014-11-18 11:00

Uber has had to deal with some bad PR after several inappropriate comments by its senior vice president, Emil Michael, were reported by Buzzfeed.

Well, sad news: This isn't the first time Uber has done something icky.

A couple of years ago, there was an entry on the company's blog titled "Rides of Glory." The company examined its rider data, sorting it for anyone who took an Uber between 10 p.m. and 4 a.m. on a Friday or Saturday night. Then it looked at how many of those same people took another ride about four to six hours later – from at or near the previous nights' drop-off point.

Yes, Uber can and does track one-night stands. Consider it the Uber equivalent of the walk of shame.

The thrill of the hunt for discount prices

Tue, 2014-11-18 10:29

The Internet can tell us how long it takes to walk the length of the Great Wall of China (10 months), how many girlfriends George Clooney has had (lots) and even how many snowflakes fall in a year (about a septillion). But consumers still can’t quickly and easily compare prices for a leather purse (big enough to tote a laptop, please) or a 10-quart aluminum stockpot.

Sure, thanks to aggregator sites like Orbitz and Cheaptickets.com, comparisons of airline tickets are easy to come by. And there’s transparency of pricing on wholesale commodities like butter, eggs and sugar. But that leaves a vast middle ground untouched. There is no Kayak9.com for teapots or women’s sweaters.

Perhaps that is because nobody — neither consumer nor retailer — wants it.

“We think we want all access, to know everything about everything in the consumer space,” said Kelly Goldsmith, an assistant professor of marketing at the Kellogg School of Management at Northwestern University. “In reality, when we know everything about everything, it is exhausting,” she said.

Especially if consumers investigate options on their own — from new to used, vendors local to national, warranty or no. Too much information, Goldsmith said, can decrease the odds of a consumer buying anything.

There is a psychological aspect to this, too. Finding deals can make people feel good. For some shoppers, it’s about the thrill of the hunt.

“When there’s something I’ve been eyeing and I see it go on sale, it’s like God just sort of put it there for me,” said Elise Ariel, a 37-year-old legal assistant, as she shopped recently at Century 21 in Manhattan. “How do I feel about sales? Like a moth to a flame.”

And while she admitted that shopping through a price aggregator site for a new pair of pumps, as she might for airline tickets, would be better from a practical standpoint, it would mean an end to her love affair with retail. “You come across something with a little red price tag on it in a bin of God knows what. You feel like it’s destiny.”

Then there is the retailer’s perspective. Consider what happened when Ron Johnson, former chief executive of J.C. Penney, committed to transparency and predictability and decided the chain would stop running sales. Shoppers waiting for the dopamine hit that comes with the unexpected opportunity for a bargain were disappointed, and customers fled in droves.

Advertising discounts, deals and perceived steals are often how retailers get shoppers in the door in the first place, said Barbara Kahn, a professor of marketing at the Wharton School at the University of Pennsylvania. “If the sale wasn’t there, well, maybe they wouldn’t go to the store that day,” she said.

For discount chains, slashing prices is crucial and nearly constant. But for midrange retailers, the Lord & Taylors and Banana Republics of the shopping world, sales are meant to be special. Competing solely on price can lead to a downward spiral of ever-deeper discounts.

“I don’t think they want to get into this game that you can’t win,” Kahn said. “They’d rather compete on providing value to the customer.”

Even if retailers agreed that transparent pricing should be more widely available, comparing prices for multitudes of products would take a special kind of brain — one that loves spreadsheets or navigating phone trees run by the Internal Revenue Service.

“There are a limited number of products where consumers have boiled down their understanding to such a limited set of factors that they can be confident truly shopping on price,” said Robert Haslehurst, the managing director of retail practice for L.E.K. consulting, a global management consulting firm.

Take the humble T-shirt and its endless varieties. “The T-shirt from Walmart and the T-shirt from the Gap aren’t the same T-shirt, and you need to be superexpert at the construction of T-shirts, and the shipping of T-shirts and the marketing of T-shirts in order to determine if one retailer was making extra margin off of you,” said Joshua Pollack, an associate partner with the Parker Avery Group, a retail price consulting firm.

Even if you do manage to sharpen your focus — to, say, a black, short-sleeve V-neck in a polyester blend — you will wonder why it costs what it does.

Raw materials are also only one part of the equation, Haslehurst said. “There was the artist who designed it. There was the retailer you bought it from and the person who put it in front of you,” he said. “There’s value in more than just the item. There’s value in the distribution.”

And then there is the variable that retailers rely on, that different shoppers are willing to pay different prices for the same product. Take the ever-changing price of a plane ticket. “One would think that I would pay the exact same price wherever I go,” Pollack said. “But because of this price discrimination capability you actually may not.” When the airline industry first began setting prices based on when customers bought tickets or how many seats were still left, customers were furious, Pollack said. And they still are. “But despite the fact that customers hate the practice, it was so profitable for the travel industry, they just had to bear it out,” he said.

It is unlikely, Pollack said, that consumers will see complete transparency of prices, mostly because comparing products is not always as easy as Apple iPhone to Apple iPhone.

Tell that to Vivian Harrow, 46, a human resources director for a global beauty company, and odds are she won’t mind. Harrow said she enjoyed browsing and scanning, but not online and not with an app. “It’s no fun to go out, and go into a store, buy something at retail, or buy something where you know every place you go it’s going to be priced exactly the same,” she said. “There’s no challenge in that. It’s just not as much fun.”

This story is part of a collaboration between Marketplace and The New York Times called “A Guide to Buying Just About Anything.” 

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