The Business Insider

100 Things Restaurant Waiters Should Never Do (Part 2)

Henry Blodget — Sat, 07 Nov 2009 11:10:00 -0500

Restaurateur Bruce Buschel continues his list in the New York Times...

As with the first 50 things waiters should never do, the underlying logic here applies to a lot more than the restaurant business.

51. If there is a service charge, alert your guests when you present the bill. It’s not a secret or a trick.

52. Know your menu inside and out. If you serve Balsam Farm candy-striped beets, know something about Balsam Farm and candy-striped beets.

53. Do not let guests double-order unintentionally; remind the guest who orders ratatouille that zucchini comes with the entree.

54. If there is a prix fixe, let guests know about it. Do not force anyone to ask for the “special” menu.

55. Do not serve an amuse-bouche without detailing the ingredients. Allergies are a serious matter; peanut oil can kill. (This would also be a good time to ask if anyone has any allergies.)

56. Do not ignore a table because it is not your table. Stop, look, listen, lend a hand. (Whether tips are pooled or not.)

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100 Things Restaurant Waiters Should Never Do

The Hot New Business Of Virtual Goods

Henry Blodget — Sat, 07 Nov 2009 10:52:00 -0500

As we've noted frequently over the past couple of months, virtual goods sales in the US are finally starting to take off.

This has been a big business in Asia for years, and we see no reason why it won't soon be an even bigger one here. It's also an extremely profitable business, with margins near 90%.

And don't laugh at all the fools buying imaginary stuff until you understand why they're doing it.

One of our favorite examples? FooPets. Click on our friend "Bengal" here and see if you don't see the appeal of having a virtual cat. And then ask yourself whether, once you've adopted him, you really want to starve him to death by not buying virtual food.

The NYT provides a quick overview of the business today. And we've added another couple of interesting links below.

Claire Cain Miller and Brad Stone, NYT: Analysts estimate that virtual goods could bring in a billion dollars in the United States and around $5 billion worldwide this year — all for things that, aside from perhaps a few hours of work by an artist and a programmer, cost nothing to produce.

“It’s a fantastic business,” said Jeremy Liew of Lightspeed Venture Partners, a venture capital firm that has invested $10 million in several virtual goods companies. “Because it’s digital, the marginal cost for every one you sell is zero, so you have 100 percent margins.”

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iPhone For Verizon In 2010

Dan Frommer — Sat, 07 Nov 2009 09:45:00 -0500

Apple will release a new iPhone next summer that works on Verizon Wireless as well as all global networks, a report claims, citing sources in the Taiwan supply chain.

The report, via AppleInsider, also says that the new iPhone will be smaller than the current iPhone, including a smaller screen. And that it will be manufactured for Apple by a different supplier, a subsidiary of netbook-maker Asustek.

Assuming Apple does not renew its exclusive U.S. deal with AT&T, it makes sense that Apple would make an iPhone that could work on Verizon, the largest U.S. wireless carrier with 89 million subscribers. (Verizon uses a different technology than AT&T--CDMA--so Apple has to build a new kind of phone to work on the network).

Why should Apple make the iPhone available on Verizon?

As we reported earlier this year, it would be ridiculously cheap for Apple to make a CDMA-friendly iPhone. Even switching the current iPhone to a CDMA version would probably cost only a trivial amount. Amol Sarva, CEO of mobile gadget startup Peek, pegs the cost at less than $5 million.
It would be very good for sales. Even though AT&T has been a hugely successful partner for Apple in terms of overall sales in the U.S., most iPhone subscribers are still coming from within AT&T's ranks -- despite the fact that AT&T only represents about 1/4 of the total U.S. wireless subscriber base. There are millions of potential iPhone buyers at other carriers who have not bought iPhones, either because they are loyal to their current carriers or hate AT&T. Verizon could also probably steal some current iPhone subscribers from AT&T, given how lousy AT&T's data network has performed in key cities, such as New York City.
It would be bad for the competition. Verizon and other carriers are finally now getting (and promoting) decent iPhone competitors, such as the new Droid series powered by Google. But if Verizon were to get its hands on the iPhone, it would probably favor that over the Droid, at least sometimes.
What about waiting for 4G? Even if Apple waits for Verizon's "LTE" 4G network to be ready, it would need to be able to back up onto a 3G network for several years, for use in places where 4G service is not available or is not functioning. It's possible that Apple could push that roaming traffic onto AT&T or another GSM-based 3G provider. But it makes more sense to roam onto Verizon's CDMA network.

We're not personally thrilled about the idea of a smaller iPhone -- we'd even spring for a slightly larger one -- but it could probably find a happy audience of women, teens, and people with smaller hands. (It may also be popular in other countries where people tend to be smaller.)

Either way, it makes a lot of sense sense for Apple to sell a phone at Verizon as soon as possible.

Now check out this Christmas's crop of smartphones, including Apple's best competition →

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This Week's Most Popular Posts

Nicholas Carlson — Sat, 07 Nov 2009 09:38:00 -0500

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Pepsi Breathes a Billion-Dollar Sigh of Relief

Above The Law — Sat, 07 Nov 2009 09:32:00 -0500

Associates at Cleary Gottlieb may not be starting their weekends on a happy note. But for legal secretary Kathy Henry, the weekend is off to a very good start.

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Pepsi Nailed With $1.26 Billion Judgment After Secretary's Mistake

The iPhone-to-Android Switch: 10 Things You Need to Know

Matt Buchanan — Sat, 07 Nov 2009 09:26:00 -0500

You've had it. Maybe with AT&T. Maybe with Apple's crushing, dictatorial grip strangling the App Store. Whatever the reason, you're going to Android: Land of freedom, carriers not named AT&T, and the great Google.

Here's what you need to know >

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Four Ways To Hire Better People

Julie Hansen — Sat, 07 Nov 2009 08:40:00 -0500

Hiring is the most important thing a manager does. And everyone makes mistakes doing it, regardless of how thorough they've been or sophisticated their process is.

I've made plenty, ranging from conducting inadequate searches to hiring -- and worse, retaining -- mediocre talent. Sometimes it ends quickly and painlessly, like the head of biz dev who failed her drug test and quit (by voicemail!) day one. Usually it's not that convenient and it's up to you to confront your mistake, let the person go, and start over.

The Business Insider is expanding rapidly right now, so that means a lot of hiring. Based on lessons I've learned the hard way, here are my four guidelines for successful hiring:

Mold the job to the person. HR professionals may cringe at this one, but in a small company everyone wears many hats. The better the job matches the skill set of the person you're hiring, the more successful they'll be at it. We've had great results hiring really smart, talented people and custom-tailoring their roles to them.

Of course, you need to make sure the role meets the company's needs as well, but a little bit of customization goes a long way to ensuring employees feel appreciated and that they are developing in their careers.
Assess fit as a key criteria in the interview process. You're looking for candidates that meet a number of requirements: experience, skill set, personal characteristics such as integrity, drive, etc. But it's critical that you find a litmus test for fit. At TBI, we need to assess whether you can you go fast, a key to startup success. Will you thrive in a direct, no-bs culture? Can you make decisions or do you need a committee? More than once we've hired an otherwise-ideal candidate and poor fit has torpedoed his or her performance. Figure out what your culture is and how to test for it or you'll bring in folks that won't work out despite sterling qualifications.
Professionalize the interview process. Hiring is harder at a startup than in corporate America where I've worked previously -- especially at prestigious, industry-leading firms like CBS, Conde Nast, and Time Inc. Although MSM is in shambles, a surprising number of talented journalists are drawn to these marquee names and view a startup as a risky bet. Fair enough: startups are usually riskier-- but MSM can't shed jobs fast enough, so it's not the kind of environment I'd expect top candidates to be drawn to right now.

To combat this perception, we are upgrading our hiring process to project a more formal "best foot forward" appearance. Two basic components: Every candidate receives a folder with information about the company and its benefits. (Many are surprised to learn that we offer health care and vacation benefits that rival larger, more established companies.) And we schedule interviews through Tungle, which eliminates the taxing back-and-forth to find a suitable time and automatically sends a confirmation. It's a small detail but it adds a sense of professionalism without the burden of hiring an assistant to manage scheduling.
Check references! Yes, this is obvious. But inexperienced managers may feel it's unnecessary because they've already reached their decision, or maybe the candidate came in through a referal they trust. It doesn't matter: we always check references. Invariably we learn something useful about the candidate that helps us appreciate the challenges we'll face integrating that person into our team.

And yes, we still have some spots open! If the above sounds good to you, we'd like to hear from you. Find out more.

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Insider Trading Probe Closes In On SAC Capital

Henry Blodget — Sat, 07 Nov 2009 08:30:47 -0500

A cooperating witness in the Galleon bust has agreed to tell the Feds everything he knows about SAC:

Susan Pulliam, WSJ: The widening investigation of insider trading on Wall Street is expected to examine transactions at Steven A. Cohen's SAC Capital Advisors, one of America's largest and most successful hedge funds, according to people familiar with the matter.

A plea agreement between the government and a cooperating witness in the investigation, Richard Choo Beng Lee, indicates that Mr. Lee has agreed to provide information to prosecutors about a hedge fund where he worked between 1999 and 2004. That firm is SAC, according to people familiar with the matter.

In March 2009, after striking the deal to assist the government, Mr. Lee sought to get rehired by Mr. Cohen, people familiar with the matter say. Mr. Cohen declined to hire Mr. Lee because he was suspicious about the recent and abrupt closure of Mr. Lee's hedge fund, Spherix, these people say.

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Einhorn: We Need To Ban Credit Default Swaps

Einhorn: We Need To Ban Credit Default Swaps

Henry Blodget — Sat, 07 Nov 2009 08:01:00 -0500

A surprising stance from David Einhorn:

Henny Sender, FT: David Einhorn, founder of Greenlight Capital, was one of the earliest and most prescient users of credit default swaps. Now he is calling for these instruments, in effect a form of insurance on individual firms (or governments) that pays out when the institution defaults or restructures, to be banned.

“I think that trying to make safer credit default swaps is like trying to make safer asbestos,” he writes in a recent letter to investors, adding that CDSs create “large, correlated and asymmetrical risks” having “scared the authorities into spending hundreds of billions of taxpayer money to prevent speculators who made bad bets from having to pay”.

CDSs are “anti-social”, he goes on, because those who buy credit insurance often have an incentive to see companies fail. Rather than merely hedging their risks, they are actively hoping to profit from the demise of a target company. This strategy became prevalent in recent years and remains so, as holders of these so-called “basis packages” buy both the debt itself and protection on that debt through CDSs, meaning they receive compensation if the company defaults or restructures. These investors “have an incentive to use their position as bondholders to force bankruptcy, triggering payments on their CDS rather than negotiate out of court restructurings or covenant amendments with their creditors”, Mr Einhorn says.

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That Dog On A Skateboard Lands A Real Commercial

Ken Wheaton — Sat, 07 Nov 2009 07:30:00 -0500

Michael Learmonth noted yesterday that American Apparel and ESPN are among those marketers who've had ads placed against the YouTube video of Tillman the skateboarding bulldog.

Well, Armstrong Flooring wasn't just content to run some ads against the video. The marketer, along with agency BBDO, New York, decided to create its own spot with a skateboarding bulldog.

The spot features said bulldog scrabbling across what appears to be Armstrong's Artesian Classics Color Wash in Birch Natural. (No, we're not flooring experts; the Armstrong website tells us this is what the spot features.) In the commercial, the dog is referred to as "Charlie," but we thought his body and skating style all indicate that he may indeed be Tillman.

Guess what? He totally is Tillman. A rep for BBDO, New York, confirmed this afternoon. Well, that's enough hard-hitting investigative journalism from me for one week.

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Berkshire's Third Quarter Net Income Triples!

Vince Veneziani — Fri, 06 Nov 2009 17:36:00 -0500

Berkshire Hathaway just posted its third quarter earnings. It appears CDS exposure actually benefited the company and helped tripled their net income.

Third-quarter net income came in at $3.24 billion, or $2,087 per Class A equivalent share, versus $1.06 billion, or $682 per Class A equivalent share, a year earlier.

Here's the breakdown:

Berkshire Hathaway: Earnings of Berkshire Hathaway Inc. and its consolidated subsidiaries for the third quarter and first nine months of 2009 and 2008 are summarized below. Earnings are stated on an after-tax basis. (Dollar amounts are in millions, except for per share amounts).

Gains from derivative contracts during the third quarter primarily relate to our credit default derivative contracts and to a lesser degree to long duration equity index put option contracts. As we have previously discussed, our derivative contracts, subject as they are to mark-to-market accounting, will produce extreme volatility in our periodic reported earnings.

During the third quarter of 2009, our book value increased to $81,247 per Class A equivalent share, an increase of 15.2% from yearend and 10.1% from the end of the second quarter. In addition to our net worth of $126.1 billion, which has increased by $16.8 billion since yearend, insurance float (the net funds that we hold pursuant to insurance contracts and that we can invest for our benefit) increased from year end by about $4 billion to approximately $62 billion at September 30, 2009.

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Confirmed: Cleary Gottlieb Matches Cravath's Bonuses

Erin Geiger Smith — Fri, 06 Nov 2009 17:33:00 -0500

The hope that a firm will snub Cravath and raise their associate bonuses just got a little dimmer.

Clearly Gottlieb sent around their bonus memo today, and it matched the amounts Cravath announced earlier this week. Above the Law broke the news and has the memo.

To review, here are the bonus amounts, by class year:

2008 $7,500
2007 $10,000
2006 $15,000
2005 $20,000
2004 $25,000
2003 $30,000
2002 and more senior $30,000

As ATL said, it is now up to Sullivan & Cromwell to step forward and raise these numbers. We would also add Skadden, who has been known to go rogue, to the list.

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Sarah Palin Bans Press, Cellphones, Cameras From Speech

Erin Carlson — Fri, 06 Nov 2009 17:30:00 -0500

Sarah Palin is sending a stern message to the media: Stay away!

Indeed, Palin has iced out press coverage of her speech at tonight's Wisconsin Right to Life event in Milwaukee, CNN reports.

Wisconsin Right to Life is the largest pro-life organization in the state, and Palin has granted a rare speech -- but no access to journalists. If reporters choose to go "rogue" and sneak in, be warned: Attendees who paid the $30 entrance fee will be stripped of all recording devices including laptops, cell phones and cameras.

CNN's Political Ticker notes that the speech comes more than a week before Palin drops her blockbuster memoir "Going Rogue: An American Life," slated for Nov. 17.

As she prepares for a promotional blitz -- which includes a sitdown with Oprah Winfrey -- Palin is likely minimizing interviews until she makes the media rounds for her book. Meanwhile, she has no problem feuding publicly with Levi Johnston.

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Mother Of Busted Inside Traders: "U can’t kiss my sons ass h---"

Lawrence Delevingne — Fri, 06 Nov 2009 17:30:00 -0500

Yesterday, brothers Zvi (pictured) and Emanuel Goffer were busted as part of the widening Galleon Group insider trading scandal.

Dealbreaker got an interesting reaction when it contacted the boys' mother for comment:

Dealbreaker in an attempt to learn more about Team Goffer, reached out to Dalia Goffer, the boy’s mother yesterday, and asked if she thought the FBI had arrested the wrong guys. In an email sent late last night she responded:

“low life…………….go get yourself a life………………..are u eating your heart…………..u can’t kiss my sons ass hole [sic]…………………..because u so sick in your brain and so low….and if u don’t stop bothering me I will contact the police.”

Well then! Let's see what the police say.

Read the whole thing here.

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Zynga CEO Mark Pincus: “I Did Every Horrible Thing In The Book Just To Get Revenues”

TechCrunch — Fri, 06 Nov 2009 17:21:00 -0500

Zynga CEO Mark Pincus said earlier this week that he intends to make sure his company’s games don’t include scammy offers in the future. Our full background on this story is here. But what he didn’t say in that blog post is that Zynga has been scamming users from the beginning qu...

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Woman Of The Year!

Dan Frommer — Fri, 06 Nov 2009 17:20:00 -0500

Google's Marissa Mayer is one of Glamour magazine's 2009 "Women of the Year." She's called "the visionary."

She tells Farhad Manjoo:

“When people think about computer science, they imagine people with pocket protectors and thick glasses who code all night,” Mayer jokes. “I do code all night! I am the stereotype, but I also break the stereotype.” Among her goals: to bring more women into technology and teach them to take chances. “Get in a bit over your head,” she says. “That’s how you grow and learn and stretch yourself.”

Read her profile at Glamour >

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Prominent Law Professor Sues Milberg For Malpractice

Erin Geiger Smith — Fri, 06 Nov 2009 17:11:00 -0500

It is not often you see a prominent law professor sue a prominent law firm and its famous founders.

Professor Phillip Bobbitt is the name plaintiff of a proposed class suing Milberg (formerly Milberg Weiss) and several individual attorneys for malpractice. Bobbitt is on the facutlies of both The University of Texas School of Law and Columbia Law.

The WSJ Law Blog found this one and noted that it comes in the same week as news of the University of Miami professor's suit (since dropped) against Above the Law.

The Complaint says that Milberg missed deadlines for designating experts and expert reports in the underlying class action. The class action plaintiffs who purchased a deferred annuity contracts from Variable Annuity Life Insurance Company; that complaint alleged that the company violated federal securities laws and that the products they were sold resulted in the "investors paying additional fees without receiving any additional tax benefits."

While the facts might not be the makings of a soap opera, the players are. Bobbitt is a constiutional theorist and international security expert who has served as a special advisor to every US president from Jimmy Carter to Bill Clinton. He is also the nephew of Lyndon Johnson and splits his time between Austin, New York and a swanky flat in London. The New York Times called his last book, Terror and Consent, "quite simply the most profound book to have been written on the subject of American foreign policy since" the end of the Cold War.

It also just so happens he looks a lot like Richard Gere on his best day. He's pictured here from an appearance on Charlie Rose.

Milberg Weiss, became Milberg, of course, after one of its name partners ran into some legal trouble. As the complaint notes, Mel Weiss may be served at a Miami corrections facility, where he is currently completing a prison sentence in a Florida half-way house. Weiss, a wildly successful class action attorney, agreed to plead guilty to a scheme that involved making hidden side payments to firm class action clients.

The complaint names various other attorneys from Milberg and other firms who worked on the underlying suit. Milberg told the Law Blog the suit is without merit.

Malpractice suits against notable firms always raise eye-brows in the legal industry -- the gossip factor for this one will be high, even if the underlying case lacks sex appeal.

BobbittComplaint

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CHART OF THE DAY: Cable Networks Saving Media Companies' Butts

Jay Yarow and Kamelia Angelova — Fri, 06 Nov 2009 16:44:00 -0500

Media companies beat earnings estimates left and right this week. How did they do it? In large part, thanks to their television divisions, where cable networks grew.

With two noticeable exceptions, the television segment of these media companies was up, while the overall companies' revenues dropped.

It's the dual revenue structure of ads and affiliate fees from cable companies that grew revenues. At CBS, ad sales were down 5%, but affiliate fees were up 11%. Affiliate fees were up double digits year over year for half these companies. Meanwhile, ad sales were down.

The exceptions on the chart below? NBC and Comcast. Comcast is the only company that's up overall in revenue, thanks to its steady cable business. NBC is the only television segment that's down, due to weak advertising. Coincidentally, Comcast is thinking about buying NBC.

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CHART OF THE DAY: We're Bleeding Jobs, But Blood Loss Is Slowing

Vincent Fernando and Kamelia Angelova — Fri, 06 Nov 2009 16:44:00 -0500

U.S. unemployment hit a shocking 10.2% in October. Worse yet, the "real" unemployment rate, which adds in things such as discouraged workers who have dropped out of the labor force, hit 17.5%. Ouch. What are we – Europe?

Yet there's some light at the end of the tunnel.

While the unemployment rate and "real" unemployment rate rose in October, the rate of deterioration (year over year change) for both measures kept falling, as shown below. Moreover, the trend of the more conservative "real" unemployment rate (in red) improved faster than that of standard unemployment (in blue).

Thus we're still bleeding jobs and it hurts, but the blood loss is slowing rapidly and starting to come under control. Hopefully the patient still has a pulse by the time the blood stops.

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Turbulent Market Squeezes Out Gains

Vince Veneziani — Fri, 06 Nov 2009 16:02:00 -0500

The big 10.2% unemployment number hit this morning and stocks were down. Then they were up. Then they were down. This cycle repeated itself throughout the day, finally ending with Dow up 17 points, the NASDAQ up 7 points, and the S&P up 2 points.

While Fannie Mae was busy asking the government for another $15 billion, Oil dropped to $77.67 a barrel.

Gold, however, continued to rise as the U.S. dollar fell. December futures contracts are now trading over $1,100.

By sector, financials and insurance took a pretty nasty loss. Tech remained relatively stable throughout the day and energy companies got smashed by the Bears. Consumer retail spending remains positive, though, which helped keep companies like McDonald's (MCD), FedEx (FDX), Comcast (CMCSA), and Lowes Hardware (LOW) afloat. GE (GE) gained 6.2% to close at 15.33.

Finally, one of today's breakout stars is Activision-Blizzard (ATVI), which closed at 11.25, up 3.5%. Great Q309 results with a strong balance sheet and healthy properties helped it beat analyst expectations. With the release of Call of Duty: Modern Warfare 2 next week, ATVI is poised to smash video game records. Modern Warfare 2 will most likely gross more than a typical hollywood blockbuster in its first two weeks of sales.

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