Paper Prices to Rise; Sony May Play a Lower-Cost Game
Sony May Play a Lower-Cost Game
As critical holiday sales approach, the fight for video game supremacy is heating up like a Smash Bros. Brawl. Most notably, Sony is expected to cut the price for its PlayStation 3 a full third to $400. That would buy a new pared-down model, already announced in Japan and Europe, that has a smaller hard drive and can't run games made for the still widely used PlayStation 2. But it would handle all PS3's games and include a Blu-ray drive that can play high-definition disks.
Analysts have clamored for PS3 price cuts from Sony, which has lost gamers to Microsoft's Xbox 360 and Nintendo's popular Wii. And now Nintendo says the Wii will remain in short supply, perhaps adding to its allure but not to its U.S. market share. Also sucker-punching the Wii: a delay until next year for the sequel to its Smash Bros. game. - David LaGesse
Power-Tripping PCs Face a Test
It means something again to look for the Energy Star label when buying a computer. The government had left unchanged for seven years the criteria for earning the widely recognized power-saving seal, so nearly every PC on the market qualified. But the feds have now rolled out Energy Star 4.0—stringent new stand-ards that only a quarter of computers will meet.
The standards now limit power use in standby and in the most common mode, idle (with the computer on but not actively handling data). Some desktops would have to cut their idle power use in half to earn the coveted star.
The government says that if all U.S. households and businesses switched to Energy Star computers, they'd save more than $1.8 billion in energy costs over the next five years. But expect higher upfront costs—about a 3 to 5 percent premium, says one manufacturer—and payback over about three years with modest electric bill savings. - Marianne Lavelle
Is the Third Year the Charm for Stocks?
While it set new records last week, the stock market is still not performing as well as a market historian might have predicted heading into 2007, the third year of President Bush's second term.
Since 1945, presidential third years have been the best for stock investors (chart). "The market typically does well in the third year, since investors buy in advance of the anticipated benefits to the economy brought by the economic stimulus initiated by the sitting president in order to get himself or his party re-elected," explains Sam Stovall of Standard & Poor's.
But with the S&P up 10.2 percent so far this year (through October 10), the market has a long way to go to catch up to the historical trend. - Matthew Bandyk
The high cost of energy is hitting consumers at home—specifically, in the bathroom. Kimberly-Clark, the Dallas-based maker of Kleenex and Huggies diapers, said last week that it would raise prices on a range of paper products by 4 to 7 percent in February. The price hikes, which will add about $1 to the $12.99 parents pay for a 34-pack of Huggies, stem from "significant inflationary pressure from higher raw material and energy costs," the company said.
Kimberly-Clark pulls in $4 billion in annual sales from the Cottonelle, Scott, Viva, and Huggies brands affected. The company said it shelled out a budget-busting $165 million in the first six months of this year for pulp and other raw materials. Some suspect Kimberly-Clark, which made its pricing change public early to cushion the blow, may have more wiggle room, though: The company reported an 8.2 percent increase in net sales this summer and announced a $2 billion share buyback plan. Mamas, don't let your babies grow up to be paper product executives. - Justin Ewers
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