Posts in category Business


ApprovedBusinessBusiness and finance

Global LNG giants turn to poor countries for new markets

Bringing rivers of the liquefied stuff

WHEN it comes to liquefied natural gas (LNG), the supermajors have supersized appetites. The likes of Royal Dutch Shell, ExxonMobil and BP make discoveries described as “elephants”; their cost overruns alone can run into the tens of billions of dollars; and projects take the best part of a decade to complete. For years, the industry has demanded fixed, long-term contracts from their customers to justify the size of these megaprojects.

The producers also have pretty big problems. They are in the midst of a vast expansion in Australia and elsewhere just as the shale revolution and the start of American LNG exports has brought an unexpected burst of gas onto markets, clobbering prices for the foreseeable future and forcing producers into concessions. Demand in rich countries such as Japan and much of western Europe appears to be in long-term decline.

At least one big customer, China, is making life easier….Continue reading

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New rail routes between China and Europe will change trade patterns

ASTANA in Kazakhstan is one of the world’s most remote capitals, surrounded by thousands of kilometres of empty steppe. This summer Astana attempted to launch itself onto the global stage by hosting the World Expo, which closed on September 10th and underwhelmed many attendees. But there are other ways to have an impact. On the city’s north side, away from the Expo’s exhibits, a series of diesel trains, each pulling dozens of containers, roll through the old railway station. Most are heading from China to Europe. Last year over 500,000 tonnes of freight went by train between the two, up from next to nothing before 2013. Airlines and shipping firms are watching things closely.

The trains rumbling through Astana result from a Chinese initiative, in tandem with countries like Kazakhstan, to build a “New Silk Road” through Central Asia. The earlier overland routes were once the conduits for most trade between Europe and China and India; they faded into irrelevance…Continue reading

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A legal vulnerability at the heart of China’s big internet firms

COMPANIES’ legal structures are usually mind-numbing fare. But occasionally it is worth pinching yourself and paying attention. Take “variable interest entities” (VIEs), a kind of corporate architecture used mainly by China’s tech firms, including two superstars, Alibaba and Tencent. They go largely unremarked, but VIEs have become incredibly important. Investors outside China have about $1trn invested in firms that use them.

Few legal experts think that VIEs are about to collapse, but few expect them to endure, either. One sizeable investor admits loving Chinese tech firms’ businesses while feeling queasy about their legal structures. Like scientists appalled by their monstrous creations, even the lawyers who designed VIEs worry. They are “China’s version of too-big-to-fail”, says one. As well as being spooky, VIEs are another instance of how China’s weak property rights hurt its citizens.

What are VIEs? Over 100 companies use them. Since the 1990s private firms have sought to break free of China’s isolated legal and financial systems. Many have done so by forming holding companies in tax havens and listing their shares in New York or Hong Kong. The problem is that they are then usually categorised as “foreign firms” under Chinese rules. That in turn prohibits them from owning assets in some politically sensitive sectors, most…Continue reading

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The business of sperm banks

Fruit of a global supply chain

BROWSING websites that list sperm donors is weirdly similar to online dating. “Sanford is the total package,” begins one online ad, describing his strong jawline and piercing blue eyes. With a degree in finance and a “charming demeanour”, he is more than a pretty face. You can listen to a voice recording from Sanford himself. If all that wins you over, you can have his baby without ever having to go on a date. For $635, Seattle Sperm Bank (SSB) will post you a vial of his frozen swimmers.

The fact that the main customers for many sperm banks are now single women explains the marketing technique. “They tend to be highly educated, impatient and picky,” says Ole Schou, founder of Cryos International, the world’s largest sperm bank, based in Denmark’s second-biggest city, Aarhus. Its website is designed to resemble Match.com, a dating site, because “finding a donor should be as close to finding a natural partner as…Continue reading

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China moves towards banning the internal combustion engine

“A DEFINING moment for the auto industry.” That is how usually restrained analysts at Sanford C. Bernstein, a research firm, described the news that China’s government wants to move towards a ban on gas guzzlers. On September 9th, Xin Guobin, vice minister of industry and information technology, told an automotive conference in Tianjin, a grimy industrial city near Beijing, that the government is developing a long-term plan to phase out vehicles powered by fossil fuels.

The news reverberated around car firms, for which China is the largest market. William Russo of China’s Gao Feng Advisory, a consultancy, who was previously a senior executive at Chrysler, says China is simply far too big to lose out on. “If China says no more fossil-fuel powered cars, global carmakers must follow.”

No timeline for a ban was suggested. China already has ambitious medium-term goals for automotive efficiency and climate change, including a cap on carbon emissions by 2030. Experts…Continue reading

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Rivalry between Apple and Samsung in smartphones will grow fiercer

NEVER shy about hype, on September 12th Apple’s boss, Tim Cook, presented the firm’s latest iPhones to a packed auditorium in its glitzy new headquarters in Cupertino. He made a grand prediction: its new, premium phone, the iPhone X (pronounced “ten”), will “set the path of technology for the next decade”. Set to be released this November, ten years after the first iPhone launched, the iPhone X has new features such as an edge-to-edge OLED screen (a thinner screen that does not use a backlight), wireless charging, facial-recognition technology and a dual-lens camera.

On the same day, Samsung, a rival smartphone-maker, held a lower-key event in Seoul. Koh Dong-jin, president of Samsung Electronics’ mobile business, announced that next year Samsung could reimagine the smartphone entirely and launch a new design with a foldable screen, which can close like a small book. On September 15th its latest premium smartphone, the Galaxy Note 8, will go on sale, boasting many of the features offered by the iPhone X.

Both are trying to convince consumers to spend around $1,000 for their new gadgets. Samsung’s new phone will cost $960; Apple’s high-end iPhone X will cost $999, 45% more than the average selling price of an iPhone in 2016. (The iPhone 8, simpler than the X and available for sale in September, will start at $699.)

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Is Margrethe Vestager championing consumers or her political career?

EVEN her enemies admire the bloody-mindedness of Margrethe Vestager, the European commissioner in charge of competition policy. Last autumn, not long after she had ordered Apple to pay €13bn ($14.5bn) in back-taxes to Ireland, to the fury of many in America, she flew across the Atlantic on a charm offensive. The Americans were not charmed; Ms Vestager was unmoved. Buckling up for the flight home, she tweeted that she had never felt so European.

Since she assumed her current role in November 2014, Ms Vestager has had several high-profile clashes with American tech firms. In May she fined Facebook €110m for misleading EU trustbusters about its takeover of WhatsApp, a messaging service. In June a long-running investigation resulted in a €2.4bn fine on Google for using its search engine to promote its own comparison-shopping service. EU trustbusters have also charged Google with using its Android operating system to promote its mobile-phone apps and services over those of rivals. That…Continue reading

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Why do European companies bother to hire ex-politicians?

THIS month Gerhard Schröder starts a new job. Shareholders in Rosneft, a Russian energy giant with a market value of nearly $60bn, are set to appoint Germany’s ex-chancellor as a board director on September 29th. Russia’s government, Rosneft’s majority-owner, nominated Mr Schröder, who is pals with Vladimir Putin. Despite Western sanctions imposed on the firm after Russia’s invasion of Ukraine in 2014, Mr Schröder’s move is no surprise. He has worked for years with Gazprom, another energy arm of the Russian state, to promote a gas pipeline to western Europe.

His ties to Russia win him few friends at home. His successor as Germany’s leader, Angela Merkel, calls his behaviour “not OK”. She also vows to reject offers of “any posts in industry once I am no longer chancellor”. Other politicians are happier to follow Mr Schröder’s example. It emerged last month that a former German president, Christian Wulff (pictured), is also employed by a foreign company. He advises…Continue reading

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An infrastructure for charging electric vehicles takes shape

A NEW phrase, “range anxiety”—the fear that an electric vehicle (EV) will run out of power before it reaches a charging-point—entered the Oxford English Dictionary in 2013. At the time a Nissan LEAF, the world’s best-selling EV, could travel only 120km between charges. A car with a full tank of fuel will travel 650-800km between refills. A motorist relying on batteries has to find a public charger, a rare sight in 2013, or plug in at home to cover the same distance. Range anxiety has not gone away as EVs have advanced. But the problem now feels much more soluble.

Many governments are pushing hard to replace the internal combustion engine (ICE) with cleaner EVs—this summer both Britain and France said that by 2040 new cars completely reliant on petrol or diesel will be illegal. By 2050, half the cars on the road globally, a billion in total, will be battery-powered, reckons Morgan Stanley, a bank. Falling battery costs mean that the total cost of EV ownership will soon hit…Continue reading

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Panipat, the global centre for recycling textiles, is fading

Tools of the shoddy trade

WHEN the doors open to the warehouse at Ambey Spinning Mills in Panipat, a city 90km from Delhi, it seems as if its contents might tumble out like those of an overstuffed cupboard. Heaps of clothes are piled to the ceiling. Ten women meticulously extract zips, chains and buttons from T-shirts, winter jackets and denims using long blades usually used to chop vegetables. Outside, a teenage boy wields a knife to bash synthetic fibre against a tree stump. In another workshop clothes are shredded, spun into yarn and woven by power looms into blankets. Bullock carts take them for further processing; they are then sent off for sale in India and beyond.

Known as the “cast-off capital”, Panipat is home to 150-200 such mills, which take in discarded clothes from Western countries and turn them into recycled cloth. The industry employs around 20,000 people and brings in annual revenues of $62m, according to Pawan Garg of All India Woollen and…Continue reading

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A craft-beer boom with Chinese characteristics

EVIDENCE unearthed at Mijiaya in Shaanxi province proved that the Chinese have an ancient tradition of making beer. Brewers were operating 5,000 years ago, using grains such as millet and Job’s tears (a kind of pearl barley). This year a couple of small-scale brewers lovingly recreated that Neolithic ale. The cloudy, hop-free beverage would challenge even the bravest microbrew devotee. Ladislao Raphael of Moonzen Brewery in Hong Kong describes it as “sour and funky”.

Yet Mr Raphael and his fellow craft-beer evangelists are winning converts. The Chinese market, which is the world’s largest, is dominated by mass-produced lager. But craft breweries are sprouting up around the country—by 2016 there were around 150, up threefold from 2015. Consumption of their brews has surged by two-thirds over the past five years, figures from GlobalData show, even as overall beer-swilling declines. This mirrors a global pattern: consumers often crave better beers as they get richer. Trend-setters…Continue reading

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Mobile technology is revamping loyalty schemes

THOSE of a cynical bent might think Tom Stuker a glutton for punishment. Over the years, Mr Stuker has flown more than 18m miles (29m kilometres) on United Airlines, a carrier not always renowned for treating its passengers tenderly. Mr Stuker may possess the world’s most impressive frequent-flyer account. Over the past half-decade he has averaged over 1m miles a year with United.

Mr Stuker is extreme in his devotion. But engendering customer loyalty is something that nearly all firms strive for. Most fail. The average American household belongs to 28 loyalty schemes. The country is home to 3.8bn scheme memberships in total, according to Colloquy, a research firm, up from 2.6bn in 2012. More than half of these accounts go unused.

Frequent-flyer programmes, introduced in the 1970s, were the first examples of modern loyalty schemes. They proved to be a clever bit of marketing. Flyers value plane seats highly, so a free one feels like a substantial reward. But…Continue reading

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America’s electricity industry prepares for a nuclear threat to the grid

When the lights go out

WHEN North Korea said on September 3rd that it had developed a hydrogen bomb, adding that it could be used for a “super-powerful” high-altitude electromagnetic pulse (HEMP) attack, America’s electricity industry was already on alert. Sceptics tend to dismiss as far-fetched the idea that the rogue regime would knock out the electricity grid by detonating a nuclear bomb high in the atmosphere. Regulators have not mandated safety measures. But the utilities are taking it seriously enough.

They are more than a year into a three-year programme, funded by about 60 electricity firms, to understand the potential impact of a HEMP attack on the generation and transmission of electricity, and to find ways to shield the network. Such concerns are not new. In 1962, when America exploded nuclear devices high above the Pacific, electrical damage was found in Hawaii. The industry has also studied analogous space-weather effects on power systems,…Continue reading

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United Technology merges with Rockwell Collins

WHEN passengers board an aircraft, only a few care whether it was built by Airbus or Boeing, two giants that make all the world’s big airliners. Fewer still would recognise the names of the thousands of suppliers that produce the 2m or so parts that go into a modern jet. Surprisingly little of the work is done by Boeing and Airbus. Boeing has outsourced 70% of the parts for its 787 aircraft. The job of assembling Airbus’s A380 superjumbo in its Toulouse factory accounts for only 4% of the work required to make it. The balance of power between aerospace firms and their suppliers is causing ructions.

Near hostilities have broken out due to a run of big mergers among parts-makers. On September 4th, United Technologies (UTC), an American conglomerate that makes Pratt & Whitney engines and other aerospace parts, announced that it had agreed to buy Rockwell Collins, an avionics firm, for $30bn. Although it is one of the biggest-ever mergers in the aerospace business, the deal…Continue reading

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Ever better and cheaper, face-recognition technology is spreading

TOURING the headquarters of Megvii in Beijing is like visiting Big Brother’s engine room. A video camera in the firm’s lobby recognises visitors in the blink of an eye. Other such devices are deployed around the office. Some of the images they capture are shown on a wall of video called “Skynet”, after the artificial-intelligence (AI) system in the “Terminator” films. One feed shows a group of employees waiting in front of an elevator with a white frame around every face and the name of each person next to it. Quizzed on the Orwellian overtones of the set-up, Yin Qi, the startup’s chief executive, simply remarks that “this helps catch bad guys.”

Even if Mr Yin wanted to ponder the implications of the technology, he would not have the time. Megvii is busy building what he describes as a “brain” for visual computing. The firm has come a long way since its founding in 2011 (its name stands for “mega vision”). More than 300,000 companies and individuals around the…Continue reading

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The lessons of fidget spinners

YOU can spin it on your nose, chin, finger or tongue. Some include LED lights, others resemble a ship’s wheel, or even a skull and crossbones. The fidget spinner has three paddle-shaped blades attached to a central, weighted disc containing ball bearings. Flick a blade and it spins, for anything up to 12 minutes in an advanced version from Japan. It was originally designed to help calm children with attention-deficit hyperactivity disorder or autism, but swept the world earlier this year as a toy that everyone can play with.

Retail sales have undoubtedly slowed recently, says Mark Austin of ToyWorld, a trade publication—good news for the schools that have banned it as too distracting for pupils. But the spinner has created a new “fidget” category of toys. And the global toy industry, which was surprised by its success, has learned lessons.

The fad started in America in February. By May, all 20 of the top-selling toys on Amazon, an online retailer,…Continue reading

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Cargill, an intensely private firm, sheds light on the food chain

ANGLERS love a record catch. Fish farmers, too. So when a salmon bred and raised near this village at the head of a Norwegian fjord was pulled out of captivity earlier this year weighing a sumo-sized 17kg, it was cause for jubilation. “It was fantastic,” says Einar Wathne, head of aquaculture at Cargill, the world’s biggest food-trading firm. Not only was it produced in 15 months, one-fifth faster than usual, it also looked and tasted good. Mr Wathne’s Norwegian colleagues celebrated by eating it sashimi-style shortly after its slaughter.

Cargill is a company usually associated with big boots rather than waders. America’s largest private company has built a reputation after 152 years of existence as middleman to the world, connecting farmers with buyers of human and animal food everywhere. Through a trading network that spans 70 countries (and that includes scores of ports, terminals, grain and meat-processing plants and cargo ships), it supplies information and finance to…Continue reading

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Naspers comes under fire for free-riding on Tencent

SOUTH AFRICA’S stockmarket has Naspers largely to thank for its recent record highs. Shares in the media and internet group have soared by 45% this year; even before then it was Africa’s most valuable firm. So recent unrest among shareholders in Naspers might seem unwarranted. But in the days before its annual general meeting in Cape Town on August 25th, noisy debate erupted, chiefly about executive pay. Many investors reckon that Bob van Dijk, its boss, is being rewarded for success that he did little to create.

The source of good fortune for Naspers lies about 7,000 miles (11,265km) away. In 2001 Koos Bekker, Mr van Dijk’s predecessor, made a brilliant investment of $32m in a little-known Chinese technology firm called Tencent. Today its 33% stake is worth $130bn, as measured by Tencent’s value on the Hong Kong stock exchange; that dwarfs the $100bn valuation of Naspers itself on the Johannesburg stock exchange. Shares in the latter rise and fall on news from Hong Kong. In its…Continue reading

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The parable of St Paul

PAUL POLMAN runs Europe’s seventh-most valuable company, Unilever, worth $176bn, but he is not a typical big cheese. A Dutchman who once considered becoming a priest, he believes that selling shampoo around the world can be a higher calling and detests the Anglo-Saxon doctrine of shareholder primacy, which holds that a firm’s chief purpose is to enrich its owners. Instead Mr Polman preaches that companies should be run “sustainably”—by investing, paying staff fairly, and by making healthy products with as little damage as possible to the environment. This is actually better for profits in the long run, he argues: society and shareholders need not be in conflict.

Mr Polman’s beliefs were tested in February when Unilever received a bid from Kraft-Heinz, a ketchup-to-hot dog gorilla controlled by Warren Buffett and 3G Capital, a fund known for ripping costs out of multinationals. If, in its own mind, Unilever is a good corporate citizen, then it sees Kraft as an angry American…Continue reading

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Pricey housing markets mean co-living buildings are on the rise

 

MONDAY is “Game of Thrones” night at The Collective’s Old Oak building. Millennials congregate in TV rooms around the 11-storey, 550-person block. Some gather at the cinema, lounging on bean bags decorated with old graphics from Life magazine. Nothing gets residents out of their rooms like the hit TV show. This is not a student dorm, however. It is home.

The Collective is a pioneer of a new property format known as “co-living”. Instead of self-contained flats, residents live in tiny rooms with 12 square metres of floor space. Most contain just a bed and a bathroom. During a two-night stay your correspondent could barely fit his shoulders into the shower cubicle.

It is outside these rooms that the building makes its pitch. It comes with a gym, spa, libraries, a good restaurant and a cinema. Residents get access to all of these amenities, as well as their room, for a rental payment of £800-£1,000 ($1,033-$1,292) a month. That includes all bills and high-speed Wi-Fi; they pay extra for meals in the restaurant. Residents have come up with their own services, too. The Collective houses a “library of things”, or a shared repository of useful objects—hammers, tape measures and even tents.

Rising rents have opened up a gap in the market. The ratio of average rents to incomes in London rose from a quarter…Continue reading

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Uber picks Dara Khosrowshahi as its new boss

“A LEADER is a dealer in hope,” said Napoleon Bonaparte. For much of this year Uber, the ride-hailing firm, has lacked both leadership and optimism. But on August 27th news leaked that Uber had poached as its new chief executive Dara Khosrowshahi, the boss of Expedia, an online-travel company. Mr Khosrowshahi is seen as both an astute dealmaker and a canny manager. In his 12 years at the helm of Expedia, the gross value of its hotel and other travel bookings more than quadrupled and its pre-tax earnings more than doubled.

Can he rally the troops? Uber is a fast-growing company that was last year valued privately by investors at around $68bn, but it has suffered a host of setbacks, which led to the ousting of Travis Kalanick, its co-founder and boss, in June. The firm faces a criminal probe by America’s Department of Justice into a covert software feature that tracked regulators, as well as allegations of incubating a sexist culture. It must also contend with multiple…Continue reading

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Samsung’s boss is sentenced to prison

SAMSUNG’S founding family, the Lees, have good reason to dislike room 417 of Seoul’s Central District Court. In 2008 it was where Lee Kun-hee, the chairman of the sprawling South Korean conglomerate, was found guilty of tax evasion. On August 25th his son, Lee Jae-yong, the vice-chairman of Samsung Electronics, stood in the same room and was sentenced to five years in prison on charges including bribery, embezzlement and perjury. The elder Mr Lee has been in hospital since suffering a heart attack in 2014. Samsung now lacks both its official and de facto bosses.

The younger Mr Lee, who plans to appeal against the verdict, was accused of paying bribes to Choi Soon-sil, a confidante of the country’s former president, Park Guen-hye. Prosecutors had argued that he hoped the payments would secure government support for an $8bn merger of two Samsung affiliates, Cheil Industries, the group’s unofficial holding company, and Samsung C&T, a construction firm. The state-run National Pension Service, the single biggest shareholder in C&T, voted for the plan in July 2015. The deal was controversial, but it helped Mr Lee consolidate his control over the group and clear the way for his succession.

The decision is a milestone in a broader influence-peddling scandal that brought down Ms Park. She was impeached in March and arrested soon after; she now…Continue reading

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American bosses continue to lobby, more quietly

IN CORPORATE America, “Trump” seems to be a dirty word, at least in public. After President Donald Trump seemed to equate the actions of white supremacists and their opponents in Charlottesville earlier this month, dozens of chief executives abandoned his advisory councils. Several organisations cancelled fundraising galas booked at Mr Trump’s Mar-a-Lago resort in Florida. Lloyd Blankfein, the boss of Goldman Sachs, an investment bank, compared Mr Trump to the dark shadow cast over parts of America by a solar eclipse: “We got through one, we’ll get through the other.”

Look past the public repudiation, though, and the schism is less stark. As Jason Furman of Harvard University’s Kennedy School, who led the White House Council of Economic Advisers during Barack Obama’s presidency, points out, the bosses’ public rejection of Mr Trump has done nothing to sap their appetite to guide policy. Lower-ranking executives from large firms continue to serve on informal…Continue reading

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Management turmoil at Infosys is particularly ill-timed

Less than thrilled

THE quickest way to start a Mexican wave in India is to head to the campus of Infosys, an IT outsourcing firm based in Bangalore, and ask all those who think they should be in charge to raise their hands. On August 18th the company’s chief executive, Vishal Sikka (pictured), resigned unexpectedly. But he still serves as executive vice-chairman. Now a chairman, a co-chairman, the interim chief executive who succeeded Mr Sikka, the board of directors and a retired founder all seem to think they should be running the show. The stalemate risks leaving the firm without a leader just as it had started the urgent work of overhauling its business.

The company’s management crisis is surprising. As one of only a few Indian IT firms that multinational companies trust to build and maintain their computer systems, Infosys has long sought to exude an aura of professionalism bordering on the dull. But clashing egos at the top now make it seem anything…Continue reading

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Investor activism is surging in continental Europe

LEAVE it to the Americans to besiege European companies in August, when the entire continent is on holiday. It emerged this month that Corvex Management, an American hedge fund, had built up a $400m position in Danone, a French food giant. AkzoNobel, a Dutch paints-and-chemicals firm which has been under heavy fire from Elliott Advisors, a subsidiary of another American activist fund, agreed to appoint three new directors to its board. An even bigger skirmish is under way in Switzerland, where Third Point, an American fund run by Daniel Loeb, is seeking to shake up Nestlé, the world’s biggest food company. Ulf Mark Schneider, Nestlé’s new boss, is under pressure to present bold plans to investors in September.

Such tussles used to be relatively rare in Europe. But shareholder activism is on the rise, with restive investors demanding corporate overhauls. Armand Grumberg, a mergers lawyer in Paris, last year counted 70 such campaigns in continental Europe. He expects this year to be…Continue reading

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Facebook, Twitter and Apple get into the television business

ON AUGUST 27th the season finale of HBO’s “Game of Thrones”, one of the most expensively produced series in television history, will air to an audience of more than 10m Americans. When it ends, viewers can switch to one of the most inexpensively produced shows in the industry, “Talk the Thrones”, in which boffins sit around and discuss HBO’s show. Hundreds of thousands are expected to watch.

Besides the obvious gap in entertainment value (one has dragons, the other has people talking about them), there is another distinction between the series. “Game of Thrones” is available only for a subscription on pay TV. “Talk the Thrones” is free on Twitter, produced by a digital site called The Ringer and sponsored by Verizon, a telecommunications giant. Although the HBO series is more popular, “Talk the Thrones” may be a better sign of how the TV industry might evolve.

A new generation of TV shows is being made for…Continue reading

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Artificial intelligence will create new kinds of work

WHEN the first printed books with illustrations started to appear in the 1470s in the German city of Augsburg, wood engravers rose up in protest. Worried about their jobs, they literally stopped the presses. In fact, their skills turned out to be in higher demand than before: somebody had to illustrate the growing number of books.

Fears about the impact of technology on jobs have resurfaced periodically ever since. The latest bout of anxiety concerns the arrival of artificial intelligence (AI). Once again, however, technology is creating demand for work. To take one example, more and more people are supplying digital services online via what is sometimes dubbed the “human cloud”. Counter-intuitively, many are doing so in response to AI.

According to the World Bank, more than 5m people already offer to work remotely on online marketplaces such as Freelancer.com and UpWork. Jobs range from designing websites to writing legal briefs, and typically bring in at least a few…Continue reading

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Computer-game tournaments go mainstream

Neymar, watch out

FIREWORKS detonated, smoke wafted over the stage and confetti began to fall. Seventeen thousand fans cheered the European players of Team Liquid, with monikers like “MinD_ContRoL” and “MATUMBAMAN”, who had just triumphed over a Chinese side to win The International, a tournament held in Seattle’s KeyArena on August 7th-12th. In the stands Max Martinez, a 25-year-old bartender from Phoenix, was in a state of nirvana. “This is like my Super Bowl,” he said.

But the players in this tournament had no need to catch, throw or run. Their most important muscles are those in their fingers. MinD_ContRoL, a bespectacled Bulgarian named Ivan Ivanov, excels at a computer game called “Dota 2”. Valve Corporation is the producer of “Dota 2”. It has put on The International since 2011, offering more than $10m to this year’s winners. The prize money is particularly rich, but the tournament itself is not unusual. E-sports, in which computer…Continue reading

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A trade dispute threatens America’s booming solar industry

LAST year California Solar Systems (CSS), a small installer of residential solar panels, decided to “Buy American”. It turned to Suniva, a Chinese-owned firm that makes photovoltaic panels in Georgia and Michigan, rather than use cheap imports. But according to CSS’s boss, Bastel Wardak, Suniva was unable to deliver what it promised, leading to unacceptable delays. He then tried SolarWorld, a more expensive producer in Oregon whose panels could also be marketed as “Made in the USA”. But troubles at SolarWorld’s German parent put a stop to that. Now Suniva and SolarWorld are seeking new protections from America’s International Trade Commission (ITC). On August 15th Mr Wardak was one of many to testify that the two firms did not deserve them.

The case pits American solar-cell makers against solar-panel installers. It could have big implications. Solar was the biggest source of power-generating capacity built in America last year, thanks to falling prices (see…Continue reading

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