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Issue 68

August 2011
Portfolio
emirates.com
Andrew
Mason
Group Strategist
INTERNET SECURITY
A New Breed of Hacker
HIGH-SPEED DELIVERY
Chinas New Rail Age
QUALCOMMS VISION
Winning the Chip Wars
Exclusive to Emirates First Class and Business Class
!Cover August2011.indd 1 7/26/11 2:01:50 PM
the day-date
EVERY ROLEX IS MADE FOR GREATNESS. THE DAY-DATE, INTRODUCED IN
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the day-date
EVERY ROLEX IS MADE FOR GREATNESS. THE DAY-DATE, INTRODUCED IN
1956, WAS THE FIRST WATCH TO DISPLAY THE DATE, AS WELL AS THE DAY
IN ITS ENTIRETY. A POWERFUL EXPRESSION OF ELEGANCE AND STYLE, ITS
CLASSIC DESIGN QUICKLY BECAME A FAVOURITE AMONG WORLD LEADERS.
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100100 7070 3030 10010060 70 70 40 70 70 30 30 100 40 100 40 40 100 10 40 40 20 70 70 3.1 2.2 2.2 70 40 40 75 66 66 50 40 40 251919 0 0 0 0
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HarryWinston_Portfolio_MidnightAuto_July.indd 1 5/27/11 2:37:04 PM
Portfolio
Exclusive to Emirates First Class and Business Class 5
Features
28 An ATM That Detects Lies
A major Russian bank is developing an ATM that uses
voice-analysis software to detect nervousness or emotional
distress, possible indications that a credit applicant is being
economical with the truth.
32 Canadian Pipeline Hits a Snag
The proposed Keystone XL pipeline that aims to move oil
from Albertas tar sands to the US has been under intense
scrutiny by environmentalists.
38 High-tech Customer Service
Digitally-driven service enhancements are opening up totally
new avenues of customer service that were previously only
available to large companies.
42 Qualcomms Futuristic Vision
Paul Jacobs has taken Qualcomm to the top of the mobile
chip market. But his ambition stretches way beyond the
confines of mobile phones.
46 Mannequins with Personality
During the recession, retailers cut costs and that included
window dressing and mannequins. But that has changed
as retailers target a narrower customer base.
50 High-Speed Development
Chinas bullet train network is giving the country a
competitive edge as it makes inland provinces accessible
to big business.
Cover Story
This issue
August 2011
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54 Swiss Luxury
Swiss Development Group is bringing a new wave of
property development to Switzerland the ultra-luxury,
zero-maintenance kind.
22 The Golden Nugget
32
There`s nolhing new in buIk buving and
negolialing discounls. Bul Groupon does il in
4, counlries for more lhan ,u miIIion peopIe.
Il`s an idea so simpIe anvone couId have
lhoughl of il. UnforlunaleIv, Andrew Mason
gol lhere firsl. And now he`s silling on a
companv worlh $3u biIIion.
5-6 Contents.indd 5 7/20/11 5:05:05 PM

9 Notebook
World business in a nutshell.
15 Observer
Spotting and analysing business trends.
20 Column: Ian Sample
Repairing Genetic Defects
Portfolio
Exclusive to Emirates First Class and Business Class
6
Departments
Essentials
59 Sean Fitzpatricks New Zealand Guide
The Rugby World Cup in New Zealand will be a national
carnival, according to the former All Blacks captain. Sean
Fitzpatrick takes us on a tour of the country he loves.
64 Boutique Hotels Aim High
There are many boutique hotels in the works around
the world. While many analysts believe there is a market
for them, others feel that we will soon see mergers and
rationalisation in the boutique sector.
68 Monuments to Ancient Life
The Chinese province of Fujian boasts around 3,000 tulou,
ancient buildings that housed whole clans. But they are now
falling into disrepair as young people migrate for jobs or
seek modern apartments.
72 Creative Vibrancy
Karim Rashid wants to make the world a more fun and
stimulating place, and that ethos is borne out in each of the
3,000 objects that bear his name.
76 Counting Planets
The Kepler spacecraft has so far detected 1,235
candidate planets, of which 15 are confirmed. The
more planets are found, the higher is the chance of
another Earth-like planet existing.
80 Big Screen Paris
Woody Allens latest film shows off his love for the City
of Lights as he takes viewers on a romantic tour of its
attractions.
84 Is Hacking On the Rise?
There has been a spate of high-profile hacking incidents
on the internet in recent months. Is this a sign of things to
come or merely a blip?
88 Other Business
Portfolio takes a light-hearted look at the latest business news.
Portfolio
Published for Emirates by
PO Box 2331, Dubai, UAE.
Telephone: (+971 4) 2824060,
fax:(+971 4) 2824436,
e-mail: emirates@motivate.ae
Printed by Emirates Printing Press, Dubai, UAE
Editor-in-Chief Obaid Humaid Al Tayer Group Editor & Managing Partner Ian Fairservice Group Senior Editor Gina
Johnson Senior Editor Guido Duken Editorial Assistant Hilda DSouza Art Director Tarak Parekh Junior Designer
Roui Francisco Senior Production Manager S Sunil Kumar Production Manager C Sudhakar Senior Advertisement
Manager Jaya Balakrishnan Email: jaya@motivate.ae General Manager Group Sales Anthony Milne Email: anthony@
motivate.ae Business Development Manager Nicola Hudson Advertisement Manager Rameshwar Nepali
Emirates takes care to ensure that all facts published
herein are correct. In the event of any inaccuracy,
please contact The Editor. Any opinion expressed is
the honest belief of the author based on all available
facts. Comments and facts should not be relied upon
by the reader in taking commercial, legal, nancial or
other decisions. Articles are by their nature general,
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before any actions are taken.
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5-6 Contents.indd 6 7/20/11 5:05:13 PM
Rare Earth Bonanza
Rare earths are loaded
aboard a ship in China.
Currently, China produces
97 per cent of the worlds
rare earth metals. G
R
A
P
H
E
A
S
T
9
Notebook
BUSINESS NEWS IN BRIEF
August 2011
wiLh Japan, causing Lho counLrv Lo sook
now sourcos of Lho raro oarLh minoraIs.
Tho BriLish journaI GZmnk^@^hl\b^g\^
roporLod LhaL a Loam of scionLisLs Iod
bv Yasuhiro KaLo, an associaLo profossor
of oarLh scionco aL Lho UnivorsiLv of
Tokvo, found Lho minoraIs in soa mud
aL ,8 IocaLions. Tho minoraIs woro found
aL dopLhs of 3,uu Lo 6,uuu moLros
boIow Lho ocoan surfaco. Tho doposiLs
aro in inLornaLionaI waLors oasL and
wosL of Hawaii, and oasL of TahiLi in
Ironch PoIvnosia.
Tho US GooIogicaI Survov has
osLimaLod LhaL gIobaI rosorvos aro
jusL 11u miIIion Lonnos, found mainIv
in China, Russia and oLhor formor
SovioL counLrios, and Lho UniLod SLaLos.
Tho numbor of firms sooking
Iiconcos Lo dig Lhrough Lho Pacific
Ocoan fIoor is growing rapidIv. Tho
IisLod mining companv NauLiIus has
Lho firsL Iiconco Lo mino Lho fIoor of Lho
Bismarck and SoIomon ocoans around
Papua Now Guinoa.
Tho prospocL of doop soa mining for
procious moLaIs - and Lho damago
LhaL iL couId do Lo marino ocosvsLoms -
is worrving onvironmonLaIisLs.
C
:I:G>L>K>L>:K<A>KL
havodiscovorod vasL doposiLs of
raro oarLh minoraIs, usod in manv
hi-Loch appIiancos, in Lho mud of Lho
Pacific Ocoan fIoor. Tho gooIogisLs osLimaLo
LhaL Lhoro aro abouL 1uu biIIion Lonnos of
Lho raro oIomonLs.
China curronLIv producos 0, por
conL of Lho worId`s raro oarLh moLaIs.
AnaIvsLs sav Lho Pacific discovorv couId
chaIIongo China`s dominanco, if rocovoring
Lho minoraIs from Lho soabod provos
commorciaIIv viabIo. China`s apparonL
monopoIv of raro oarLh producLion
onabIod iL Lo rosLrain suppIv IasL
voar during a LorriLoriaI dispuLo
9-12 Snippets (Notebook).indd 9 7/20/11 5:58:13 PM
Rare Earth Bonanza
Rare earths are loaded
aboard a ship in China.
Currently, China produces
97 per cent of the worlds
rare earth metals. G
R
A
P
H
E
A
S
T
9
Notebook
BUSINESS NEWS IN BRIEF
August 2011
wiLh Japan, causing Lho counLrv Lo sook
now sourcos of Lho raro oarLh minoraIs.
Tho BriLish journaI GZmnk^@^hl\b^g\^
roporLod LhaL a Loam of scionLisLs Iod
bv Yasuhiro KaLo, an associaLo profossor
of oarLh scionco aL Lho UnivorsiLv of
Tokvo, found Lho minoraIs in soa mud
aL ,8 IocaLions. Tho minoraIs woro found
aL dopLhs of 3,uu Lo 6,uuu moLros
boIow Lho ocoan surfaco. Tho doposiLs
aro in inLornaLionaI waLors oasL and
wosL of Hawaii, and oasL of TahiLi in
Ironch PoIvnosia.
Tho US GooIogicaI Survov has
osLimaLod LhaL gIobaI rosorvos aro
jusL 11u miIIion Lonnos, found mainIv
in China, Russia and oLhor formor
SovioL counLrios, and Lho UniLod SLaLos.
Tho numbor of firms sooking
Iiconcos Lo dig Lhrough Lho Pacific
Ocoan fIoor is growing rapidIv. Tho
IisLod mining companv NauLiIus has
Lho firsL Iiconco Lo mino Lho fIoor of Lho
Bismarck and SoIomon ocoans around
Papua Now Guinoa.
Tho prospocL of doop soa mining for
procious moLaIs - and Lho damago
LhaL iL couId do Lo marino ocosvsLoms -
is worrving onvironmonLaIisLs.
C
:I:G>L>K>L>:K<A>KL
havodiscovorod vasL doposiLs of
raro oarLh minoraIs, usod in manv
hi-Loch appIiancos, in Lho mud of Lho
Pacific Ocoan fIoor. Tho gooIogisLs osLimaLo
LhaL Lhoro aro abouL 1uu biIIion Lonnos of
Lho raro oIomonLs.
China curronLIv producos 0, por
conL of Lho worId`s raro oarLh moLaIs.
AnaIvsLs sav Lho Pacific discovorv couId
chaIIongo China`s dominanco, if rocovoring
Lho minoraIs from Lho soabod provos
commorciaIIv viabIo. China`s apparonL
monopoIv of raro oarLh producLion
onabIod iL Lo rosLrain suppIv IasL
voar during a LorriLoriaI dispuLo
9-12 Snippets (Notebook).indd 9 7/20/11 5:58:13 PM
N u mb e r s G a me
In Figures
The World
$2.4
million is the princely price for a special-edition Bugatti
Veyron Grand Sport LOr Blanc designed for a UAE
businessman who boasts a collection of 800 cars. The unique car
is the first vehicle to features special porcelain accents engineered
by leading German-based Koeniglliche-Porzzellan-Manufaktur.
$8.5
billion is the
amount the
Bank of America and its
Countrywide unit have
agreed on to make good
the settlement claims of
investors who took a beating
on mortgage bonds that
were issued by Countrywide
before the housing market
collapsed. At one point
investors feared BofA would
have to pay $50 billion.
$1.2
billion has
been earmarked
by Swedens Ikea to build
510,000-square-metres of malls
in China as the largest home-
furnishings company expands
in the worlds fastest growing
major economy. Leading
foreign retailers including Wal-
mart and Tesco are buying
land in China as rents climb.
2018
Winter Olympic
bid has
been won by Pyeongchang
in South Korea. This will
bring the Winter Games to
Asia for only the third time
since its debut in 1924.
$5.6
million was
fetched
for Marilyn Monroes
white subway
dress at an
auction in Beverly
Consulting Group. Kuwait,
Qatar and UAE also make
it into the top 10 with eight,
six and five per 100,000
households respectively.
0
as in no financial
considerations were
involved in a deal which will
see Microsoft Bings search
results labelled and integrated
into Baidus search results
later this year. Baidu will gain
advertising revenue generated
as a result of the improved
search results whilst Microsoft
gets to promote Bing in the
worlds biggest internet-market.
Hills, US. The dress is the
first in a series of auctions
initiated by cash-strapped
singer, dancer and actress
Debbie Reynolds. Reynolds
owns a collection of 3,500
movie costumes accumulated
over the past 50 years.
$11
billion worth of treasure
has been uncovered
from beneath the 16th century
Sree Padmanabhaswamy temple
in the Indian state of Kerala. The
Kerala state government has
decided that the treasure will
remain the property of the shrine
that served as a royal chapel for
the former rulers of the region.
18
super-rich households
worth more than 100
million per 100,000 has put
Saudi Arabia on top of the
worlds ultra-high-net-worth
(UHNW) households in
a recent report by Boston
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Sales
Boost for
Mercedes
10
Notebook
Portfolio
9-12 Snippets (Notebook).indd 10 7/20/11 5:58:17 PM
IL was Lhird Limo Iuckv for SouLh Koroa as iL won iLs bid Lo
hosL Lho 2u18 WinLor OIvmpics in Pvoongchang afLor boaLing
Munich, Gormanv, and Annocv, Iranco.
Pvoongchang, IocaLod in Lho Taobaok mounLains 13u
kiIomoLros oasL of SoouI, won in Lho firsL round of voLing
bv InLornaLionaI OIvmpic CommiLLoo mombors on JuIv ,.
Pvoongchang had IosL ouL on Lho 2u1u and 2u14 WinLor Gamos,
which wonL Lo Vancouvor and Sochi, Russia.
HosLing Lho 2u18 Gamos wiII dirocLIv add 21.1 LriIIion won
($10.8 biIIion) Lo Lho SouLh Koroan oconomv, Hvundai Rosoarch
InsLiLuLo said in a roporL. BonofiLs from incroasod Lourism and
raising Lho profiIo of Lho naLion and iLs corporaLo brands wiII
indirocLIv add a furLhor 43.8 LriIIion won ($41 biIIion) Lo Lho
oconomv in Lho 1u voars afLor Lho OIvmpics, according Lo Lho
roporL. Tho Pvoongchang bid commiLLoo has osLimaLod LhaL
Koroa`s GDP wiII go up bv 2u. LriIIion won ($10.2 biIIion) and
somo 23u,uuu jobs wiII bo croaLod.
South Korea Wins Olympic Gold
Pvoongchang has aIroadv rocoivod invosLmonL of $1.4 biIIion
for Lho AIponsia RosorL inLondod Lo houso Lho IOC hoLoI and Lho
modia viIIago for Lho WinLor Gamos. A $3.4 biIIion projocL wiII
upgrado and compIoLo a high-spood Lrain Iinking Lho ciLv wiLh
SoouI`s Inchoon inLornaLionaI airporL bv IaLo 2u1,.
Tho OIvmpic ciLv wiII aIso roquiro six moro vonuos - an aIpino
ski run, Lwo ico hockov rinks, a sIiding vonuo wiLh Lwo runs and a
spoodskaLing ovaI.
BAIDU AND MICROSOFT JOIN FORCES
in the search market, pulled its popular search engine out of
mainland China a year and a half ago. Baidu dominates the
Chinese-language search services with about 83 per cent of
the market. It has been trying for years to improve its English-
language search services as English searches on its site are as
many as 10 million a day. Microsoft seems to be betting it can
get access to what is already the worlds largest
internet population of about 470 million users.
Google continues to be available on the
mainland, though its search engine, which operates
in English and Chinese, was moved last year to
Hong Kong. But lately, Googles search engine and
its email service, Gmail, have become more difficult
to connect to on the mainland.
Google declined to comment on the partnership
between Baidu and Microsoft. Google believes its
biggest business opportunity in China is selling ads
to Chinese companies to show to users outside
China and selling display ads to run on non-Google
web sites, neither of which is dependent on search.
Chinese advertisers spent $1.7 billion on display
ads last year, one of the highest such spends in
the world.
Microsoft has struck a deal with the biggest Chinese search
engine, Baidu.com, to offer web search services in English. Baidu
is primarily a Chinese-language search engine.
In a recent announcement, Baidu said that Microsofts search
engine, Bing, was expected to appear on Baidus web pages
by the end of this year. Google, Microsofts biggest competitor
G
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IM
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Notebook
August 2011
9-12 Snippets (Notebook).indd 11 7/20/11 5:58:19 PM
EVENT NAME: INTERNATIONAL BAR ASSOCIATION ANNUAL CONFERENCE
WEBSITE: INT-BAR.ORG/CONFERENCES/DUBAI2011
DATE: 30 OCTOBER - 4 NOVEMBER 2011 VENUE: DUBAI INTERNATIONAL CONVENTION & EXHIBITION CENTRE
EVENT NAME: Management Skills For Administrative Professionals
WEBSITE: irrme.com
DATE: 7-11 August, 2011
VENUE: Hyatt Regency Hotel, Dubai
EVENT NAME: MENA Private Equity Business Summit 2011
WEBSITE: iqpc.com
DATE: 11-13 September, 2011
VENUE: Al Murooj Rotana, Dubai
EVENT NAME: Paper Arabia
WEBSITE: biztradeshows.com/al-fajer/
DATE: 18-20 September, 2011
VENUE: Dubai International Convention & Exhbition Centre, Dubai
EVENT NAME: Internal Audit and Risk Assurance
WEBSITE: irrme.com
DATE: 25-28 September, 2011
VENUE: Dusit Thani, Dubai
EVENT NAME: 19th Annual Middle East Petroleum & Gas Conference
WEBSITE: cconnection.org
DATE: 2-4 October, 2011
VENUE: Mina ASalam, Madinat Jumeirah, Dubai
Ior ovor u voars Lho InLornaLionaI Bar AssociaLion has managod Lo bring LogoLhor
IogaI profossionaIs from ovorv jurisdicLion in Lho worId - and Lhis voar wiII bo no
oxcopLion wiLh Lhousands of privaLo pracLiLionors, in-houso counsoI, human righLs
advocaLos, judgos and bar Ioadors fIocking Lo Lho Dubai InLornaLionaI ConvonLion
& ExhibiLion ConLro whoro Lho ovonL kicks off.
Opon Lo boLh mombors and non-mombors of Lho IBA, Lhis voar`s ovonL wiII foaLuro
a wido arrav of subsLanLivo sossions, workshops and panoIs; addrossing issuos ranging
from arbiLraLion Lo M&A Iaw, from human righLs Lo Lho oLhics
of Lho IogaI profossion.
In addiLion Lo Lho oxLonsivo programmo and Lho opporLuniLv Lo onjov noLworking
wiLh coIIoaguos, Lho ovonL is a uniquo chanco Lo Lako in Lho sighLs, sounds and divorsiLv
of Dubai as Lho wook of conforoncos wiII soo up Lo 1uu dinnors, rocopLions and parLios
hoId aL various vonuos across Dubai and iLs noighbouring omiraLos.
Tho ovonL concIudos wiLh a spocLacuIar CIosing ParLv aL Lho MadinaL Jumoirah.
DUBAI
United Arab Emirates
AJMAN
RAS AL KHAIMAH
UMM AL
QUAWAIN
FUJAIRAH
SHARJAH
DUBAI
12
Notebook
Portfolio
9-12 Snippets (Notebook).indd 12 7/20/11 5:58:20 PM
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2910_DR_Portfolio 20.6x27 cm.indd 1 7/17/11 6:34 PM
15
BUSINESS NEWS IN BRIEF
Observer
August 2011
F
HK>MA:G:=><:=>:@H%
inLornoL companios promoLod
now wavs Lo moasuro Lhoir
businoss porformanco, inLroducing
concopLs Iiko 'ovobaIIs` and 'mindsharo`
Lo invosLors. Now Lho IaLosL inLornoL
sLarLups aro adding Lhoir own parLicuIar
vardsLicks Lo Lho vaIuaLion vocabuIarv.
Trv ACSOI - a moLric so now LhaL
Lhoro`s no agroomonL on how Lo pronounco
iL. Doponding on whom vou ask, iL`s
oiLhor 'ack-sov` or 'ack-swa.` ShorL for
'adjusLod consoIidaLod sogmonL oporaLing
incomo,` ACSOI is ono of Lhroo vardsLicks
LhaL Groupon, Lho onIino coupon gianL,
rocommonds invosLors uso Lo doLormino
how iL is porforming. IL is ossonLiaIIv
oporaLing profiL minus Lho companv`s
Iargo onIino markoLing and acquisiLion
oxponsos - a highIv nonsLandard approach
LhaL had manv scraLching Lhoir hoads. YoL
wiLhouL iL, Groupon wouId appoar sLoopod
in rod ink.
Tho uso of such moLrics has como
wiLh a moLooric riso in vaIuaLions for
companios Iiko Groupon, LinkodIn and
Iacobook LhaL has inviLod scopLicism from
anaIvsLs and poopIo in Lho indusLrv. Thov
aro quosLioning whoLhor somo businoss
modoIs - bo Lhov a sociaI noLwork aimod
aL profossionaIs or a makor of onIino farm
gamos - can onduro.
Thoso hoL privaLo companios aro
rovoaIing Lhoir numbors, and I for ono
am surprisod how Lhov`ro noL making
monov,` said Lisa Thompson, an anaIvsL
wiLh Lho rosoarch firm ArcsLono ParLnors.
EvorvLhing in mv spaco I`vo Iookod aL
doosn`L mako monov.`
Thoso who worrv LhaL Lho now inLornoL
boom mav ropoaL Lho misLakos of Lho
IasL ono aro concornod LhaL invosLors wiII
Iook onIv for Lho posiLivo in Lhoso hoL
now companios - soizing upon moLrics
of Lho sorL LhaL Lvnn Turnor, a formor
15 15
chiof accounLanL for Lho SocuriLios and
Exchango Commission, onco caIIod EBBS,
or oarnings boforo bad sLuff `.
Tho quosLion is whoLhor Lho now
wavo of wob companios has susLainabIo
businossos or aro simpIv Iiko Wobvan
and Kozmo.com, mirod in a soarch for
profiLabiIiLv. Groupon`s businoss modoI is
buiIL on offoring a varioLv of daiIv doaIs
worIdwido, puIIing in $,13.4 miIIion in
rovonuo IasL voar. BuL iL IosL $4u miIIion,
as Lho companv sponL $444., miIIion Lo
Iuro in now subscribors Lo iLs nowsIoLLors
and Lo acquiro smaIIor compoLiLors. ThaL`s
whoro ACSOI comos in. Bv sLripping
ouL Lhoso cosLs, Lho companv arguos,
invosLors can soo jusL how Lho coro
businoss is doing, Lhough iL warns LhaL Lho
moasuromonL shouId noL bo usod Lo vaIuo
Lho companv. Using ACSOI, Groupon
oarnod $6u.6 miIIion IasL voar, moro Lhan
2u Limos whaL iL roporLod in 2uu0. And in
Lho firsL quarLor of 2u11 aIono, iL roapod
$81.6 miIIion.
And Groupon arguos LhaL iL is
choosing Lo spond Iargo amounLs of
monov now bocauso iL is imporLanL Lo
acquiro as manv subscribors as possibIo,
hoping Lo gain formidabIo scaIo as
Amazon and NoLfIix havo dono in Lhoir
own indusLrios. Groupon aIso savs LhaL
Lho cosL of mainLaining subscribors,
which is facLorod inLo ACSOI, is far
Iowor Lhan Lho oxponso of gaining Lhom
in Lho firsL pIaco. ThaL cosL amounLod Lo
abouL Lhroo por conL of rovonuo IasL voar,
Lhough iL roso Lo abouL 4.4 por conL in
Lho firsL quarLor.
Internet startups have always been creative
when it comes to ways of measuring their business
performance. In some cases it may be justified,
but it does lead to questioning of business models,
reports Michael De La Merced.
Unusual Accounting
15-19 Snippets (Observer).indd 15 7/20/11 6:13:47 PM
C
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huawei portfolio.pdf 7/21/11 4:45:13 PM
15
BUSINESS NEWS IN BRIEF
Observer
August 2011
F
HK>MA:G:=><:=>:@H%
inLornoL companios promoLod
now wavs Lo moasuro Lhoir
businoss porformanco, inLroducing
concopLs Iiko 'ovobaIIs` and 'mindsharo`
Lo invosLors. Now Lho IaLosL inLornoL
sLarLups aro adding Lhoir own parLicuIar
vardsLicks Lo Lho vaIuaLion vocabuIarv.
Trv ACSOI - a moLric so now LhaL
Lhoro`s no agroomonL on how Lo pronounco
iL. Doponding on whom vou ask, iL`s
oiLhor 'ack-sov` or 'ack-swa.` ShorL for
'adjusLod consoIidaLod sogmonL oporaLing
incomo,` ACSOI is ono of Lhroo vardsLicks
LhaL Groupon, Lho onIino coupon gianL,
rocommonds invosLors uso Lo doLormino
how iL is porforming. IL is ossonLiaIIv
oporaLing profiL minus Lho companv`s
Iargo onIino markoLing and acquisiLion
oxponsos - a highIv nonsLandard approach
LhaL had manv scraLching Lhoir hoads. YoL
wiLhouL iL, Groupon wouId appoar sLoopod
in rod ink.
Tho uso of such moLrics has como
wiLh a moLooric riso in vaIuaLions for
companios Iiko Groupon, LinkodIn and
Iacobook LhaL has inviLod scopLicism from
anaIvsLs and poopIo in Lho indusLrv. Thov
aro quosLioning whoLhor somo businoss
modoIs - bo Lhov a sociaI noLwork aimod
aL profossionaIs or a makor of onIino farm
gamos - can onduro.
Thoso hoL privaLo companios aro
rovoaIing Lhoir numbors, and I for ono
am surprisod how Lhov`ro noL making
monov,` said Lisa Thompson, an anaIvsL
wiLh Lho rosoarch firm ArcsLono ParLnors.
EvorvLhing in mv spaco I`vo Iookod aL
doosn`L mako monov.`
Thoso who worrv LhaL Lho now inLornoL
boom mav ropoaL Lho misLakos of Lho
IasL ono aro concornod LhaL invosLors wiII
Iook onIv for Lho posiLivo in Lhoso hoL
now companios - soizing upon moLrics
of Lho sorL LhaL Lvnn Turnor, a formor
15 15
chiof accounLanL for Lho SocuriLios and
Exchango Commission, onco caIIod EBBS,
or oarnings boforo bad sLuff `.
Tho quosLion is whoLhor Lho now
wavo of wob companios has susLainabIo
businossos or aro simpIv Iiko Wobvan
and Kozmo.com, mirod in a soarch for
profiLabiIiLv. Groupon`s businoss modoI is
buiIL on offoring a varioLv of daiIv doaIs
worIdwido, puIIing in $,13.4 miIIion in
rovonuo IasL voar. BuL iL IosL $4u miIIion,
as Lho companv sponL $444., miIIion Lo
Iuro in now subscribors Lo iLs nowsIoLLors
and Lo acquiro smaIIor compoLiLors. ThaL`s
whoro ACSOI comos in. Bv sLripping
ouL Lhoso cosLs, Lho companv arguos,
invosLors can soo jusL how Lho coro
businoss is doing, Lhough iL warns LhaL Lho
moasuromonL shouId noL bo usod Lo vaIuo
Lho companv. Using ACSOI, Groupon
oarnod $6u.6 miIIion IasL voar, moro Lhan
2u Limos whaL iL roporLod in 2uu0. And in
Lho firsL quarLor of 2u11 aIono, iL roapod
$81.6 miIIion.
And Groupon arguos LhaL iL is
choosing Lo spond Iargo amounLs of
monov now bocauso iL is imporLanL Lo
acquiro as manv subscribors as possibIo,
hoping Lo gain formidabIo scaIo as
Amazon and NoLfIix havo dono in Lhoir
own indusLrios. Groupon aIso savs LhaL
Lho cosL of mainLaining subscribors,
which is facLorod inLo ACSOI, is far
Iowor Lhan Lho oxponso of gaining Lhom
in Lho firsL pIaco. ThaL cosL amounLod Lo
abouL Lhroo por conL of rovonuo IasL voar,
Lhough iL roso Lo abouL 4.4 por conL in
Lho firsL quarLor.
Internet startups have always been creative
when it comes to ways of measuring their business
performance. In some cases it may be justified,
but it does lead to questioning of business models,
reports Michael De La Merced.
Unusual Accounting
15-19 Snippets (Observer).indd 15 7/20/11 6:13:47 PM
Portfolio
Observer
16
Groupon doos offor Lwo oLhor
moasuromonLs for vaIuaLion purposos, froo
cash fIow and gross profiL, boLh of which
havo a Iong basis in sLandard accounLing
ruIos. Groupon roporLod a LonfoId riso in
froo cash fIow IasL voar, Lo $,2 miIIion, whiIo
iLs gross profiL swoIIod Lo $28u miIIion from
$1u.0 miIIion Lho provious voar.
HMA>KG>P inLornoL companios aIso
promoLo nonsLandard accounLing moLrics.
Domand Modia, Lho pubIishor of Lhousands
of amaLour how-Lo arLicIos, sproads ouL
Lho cosL of paving iLs armv of conLracL
wriLors ovor fivo voars, arguing LhaL Lho
Iong Iifo of iLs conLonL moans LhaL Lhoso
oxponsos aro roaIIv a capiLaI invosLmonL.
ThaL accounLing moasuro hoIps fIip
Domand`s financiaI rosuILs for Lho boLLor.
On a basis of gonoraIIv accopLod accounLing
principIos, Lho companv IosL $.6 miIIion
in Lho firsL quarLor of Lhis voar. On an
adjusLod noL incomo basis, iL oarnod $.1
miIIion. Domand Modia aIso ciLos adjusLod
OIBDA,` shorL for oporaLing incomo boforo
doprociaLion and amorLisaLion, and a somi-
popuIar nonsLandard moasuro aIso ciLod bv
Lho Iikos of CBS and Timo Warnor.
Such movos bring Lo mind Lho IasL Loch
boom, whon companios drow upon
unusuaI accounLing and businoss vardsLicks
Lo hoIp oxpIain Lhoir Iack of profiLabiIiLv.
Amazon, for oxampIo, briofIv roporLod
profiLs LhaL sLrippod ouL iLs Lhon-sLoop
markoLing cosLs, noL unIiko Groupon. And
MoLoroIa incurrod 'spociaI` ono-Limo iLoms
so roguIarIv LhaL criLics askod whoLhor Lhov
woro fundamonLaI businoss cosLs.
EfforLs Lo domonsLraLo viabIo businoss
modoIs did noL ond wiLh cusLomisod
accounLing. Iirms incroasingIv Lurnod Lo
nobuIous now moasuromonLs Iiko ovobaIIs
and mindsharo Lo roprosonL Lho numbor of
visiLors a siLo aLLracLod or how woII-known
iL was among inLornoL usors.
In hindsighL, of courso, aII Lho ovobaIIs
in Lho worId couIdn`L subsLiLuLo for a viabIo
businoss modoI. PoLs.com arguabIv achiovod
a Lromondous amounL of mindsharo,
wiLh iLs spokospuppoL appoaring in a
Supor BowI ad and in Lho 1000 Macv`s
Thanksgiving Dav Parado. YoL dospiLo Lho
modia aLLonLion, Lho siLo, a poL food roLaiIor,
cIosod Ioss Lhan a voar afLor iLs iniLiaI pubIic
offoring, woighod down bv an inabiIiLv Lo
profiL from a singIo saIo.
Tho IaLosL gonoraLion of wob
companios diffors in manv wavs
from iLs foroboars, wiLh manv of iLs
ranks drawing roaI oarnings from
advorLising and oLhor sourcos of
incomo. LinkodIn gonoraLod $3.4
miIIion in profiL IasL voar. Using
adjusLod oarnings, which accounLs
for iLoms Iiko sLock-basod componsaLion,
iL roporLod noarIv $48 miIIion.
Iacobook, Lho biggosL sociaI noLwork,
oarnod abouL $4uu miIIion aLop $2
biIIion in rovonuo, poopIo briofod on
Lho companv`s rosuILs havo said. And
Lhoro is a procodonL bohind somo of Lhis
accounLing. Amazon conLondod LhaL iLs
hugo markoLing cosLs woro nocossarv
Lo goL iLs namo ouL. ThaL boL uILimaLoIv
workod for Amazon, which now Lowors
ovor Lho onIino roLaiI spaco. BuL Lho samo
didn`L hoId Lruo for PoLs.com.
ThaL`s a porfocLIv IogiLimaLo wav
for companios Lo Iook aL Lhoso Lhings
oconomicaIIv,` said Donnis Borosford,
an accounLing profossor aL Lho Torrv
CoIIogo of Businoss aL Lho UnivorsiLv
of Goorgia. Tho roaI quosLion is, is LhaL
going Lo happon?`
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15-19 Snippets (Observer).indd 16 7/20/11 6:13:49 PM
O N E 2 WAT C H
There is strong speculation that Indian-born Anshu Jain
could become the co-Chief Executive Officer of Deutsche Bank.
Jain, who is the forerunner for the top job at Germanys
biggest bank, enjoys the backing of the supervisory board
headed by Chairman Clemens Boersig. To allay concerns over
making a non-German-speaking investment banker sole CEO,
Jain, 48, might be partnered with Juergen Fitschen, 62, Rainer
Neske, 46, or another management board member.
Investors and shareholders are keen that the Frankfurt-based
bank maps out an orderly selection process for the 63-year-old
Josef Ackerman, whose contract runs until May 2013. Indian-
born Jain is an economics student from Delhi University and
holds a Masters of Finance from the University of Massachusetts
Amherst. He joined Deutsche Bank in 1995 from Merrill Lynch.
He led the debt sales and trading division in 2001 and four years
down was named co-head of the investment bank.
Jain is credited with building up the banks investment
banking division as a profitable business even through the
financial crisis when global investment banking suffered a
decline. Jain has long been the favoured candidate for many
investors who believe his success in building up a business that
generated nearly three quarters of the banks revenues in 2010
should override any concerns about his relatively low profile
and lack of political connections in Germany in addition to him
not speaking German.
TEXT: HILDA DSOUZA
Anshu Jain
Japanese Rebound
Tho nows coming ouL of Japan is goLLing boLLor as in JuIv Lho
Bank of Japan raisod iLs oconomic assossmonL for a socond
monLh afLor companios rampod up producLion aL Lho fasLosL
paco in moro Lhan u voars.
AuLomakors from TovoLa Lo Honda aro rosLoring faciIiLios
and hiring workors Lo mako up for IosL ouLpuL from Lho March 11
LombIor. According Lo a JuIv roporL companios oxpocL profiLs Lo
surgo 21 por conL in Lho socond haIf of Lho voar. Companios aro
aIso forocasLing a surgo in profiLs in Lho socond haIf of Lhis fiscaI
voar and consumor confidonco has roboundod from a Lwo-voar Iow,
adding Lo ovidonco LhaL Lho worsL of Lho posL-quako sIump is ovor.
TovoLa, Lho worId`s IargosL auLomakor, said domosLic pIanLs
woro running aL 0u por conL of pIannod IovoIs in Juno, up from
u por conL in ApriI and Mav, whon ouLpuL was doprossod bv a
shorLago of parLs from suppIiors.
ManufacLurors soo businoss prospocLs improving IaLor Lhis
voar and pIan Lo spond moro on pIanL and oquipmonL whiIo
aIso sLopping up hiring of workors, Lho conLraI bank`s Tankan
survov showod. CondiLions for sorvico providors havo aIso boon
improving. RoLaiI saIos foII aL Lho sIowosL paco in Mav sinco Lho
disasLor and wagos roso for Lho firsL Limo sinco Lho LombIor.
Howovor, oconomisLs poinLod ouL LhaL roconL signs of a
sIowdown in Lho US, Japan`s socond-IargosL oxporL dosLinaLion,
and incroasod oIocLriciLv consLrainLs aL homo in Lho afLormaLh of
a nucIoar accidonL in Iukushima, mav cIoud Lho ouLIook. Tho US
unompIovmonL raLo roso Lo 0.2 por conL in Juno, Lho highosL Lhis
voar, as pavroIIs grow aL Lho sIowosL paco in nino monLhs.
August 2011
Observer
17
The Japanese Yen has been rising steadily as a better economic
outlook and the debt crisis in Europe and America took its toll on
other currencies.
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15-19 Snippets (Observer).indd 17 7/20/11 6:13:54 PM
African Growth to Slow
Africas rate of growth will decline to 3.7 per cent in 2011 from
4.9 per cent in 2010, according to an African economic outlook
forecast by the African Development Bank.
Domestic consumer demand, good macroeconomic policies
and management, commodity prices, and prices of agricultural
exports were identified as the main drivers of growth.
Growth by regions showed that East Africa would grow the
fastest this year by 6.7 per cent, followed by West Africa with
5.9 per cent and 6.8 per cent in 2012. Central Africa was seen
growing 5.3 per cent this year and 5.7 per cent in 2012, while
southern Africas growth was forecast at 4.5 per cent, rising to
5.5 per cent in 2012. North Africa would grow the least this year,
achieving a growth rate of just 0.7 per cent.
Growth was also expected to be robust in sub-Saharan Africa,
with the regions real GDP growth expected to increase to 5.5 per
cent from 5.0 per cent in 2010. With the exclusion of Cote dIvoire,
sub-Saharan Africas growth was forecast at 5.7 per cent in 2011.
The political turmoil in North Africa was the main reason
behind the banks 0.7 per cent growth forecast for the region.
Africas GDP would rise to 5.8 per cent assuming a quick return
to stability in North Africa.
High-Tech Legal Spat
AppIo has boon using Lho
Lrado commission, which has
Lho powor Lo bIock producLs
from Lho US markoL, Lo pursuo
makors of mobiIo phonos
LhaL run GoogIo`s Android
oporaLing svsLom and compoLo
wiLh iLs iPhono. WiLh Lho
fiIing of Lho compIainL againsL
HTC, and ono fiIod JuIv
againsL Samsung EIocLronics,
AppIo is oxpanding Lho
baLLIo Lo LabIoL compuLors
LhaL chaIIongo Lho markoL
posiLion of Lho iPad. AppIo,
onco bosL known for iLs Mac
compuLors, now roIios on iLs
iPhono for abouL u por conL
of saIos and Lho iPad LabIoL
for 12 por conL.
HTC is fighLing back as Lho
companv has agrood Lo buv
S3 Graphics Co. for $3uu
miIIion afLor Lho makor of
vidoo-gamo graphics chips
won an infringomonL ruIing
aL Lho Lrado agoncv againsL
AppIo. HTC aIso has iLs own
paLonL compIainL againsL
CaIifornia-basod AppIo aL Lho
commission, wiLh findings
schoduIod Lo bo roIoasod
SopLombor 16.
Asia`s socond-IargosL makor
of smarLphonos, HTC
Corp, has boon accusod of
infringing AppIo`s paLonLs
in a caso LhaL mav haIL US
imporLs of Lho Taiwanoso
companv`s phonos and iLs
now IIvor LabIoL compuLors.
AppIo cIaims HTC is
infringing fivo paLonLs
roIaLod Lo sofLwaro
archiLocLuro and usor
inLorfacos in porLabIo
oIocLronic dovicos, hardwaro
for Louch scroons and
movomonL sonsors, according
Lo a compIainL fiIod JuIv 8
wiLh Lho US InLornaLionaI
Trado Commission in
WashingLon. Tho compIainL
is Lho socond AppIo has fiIod
againsL HTC.
Portfolio
Observer
18
15-19 Snippets (Observer).indd 18 7/20/11 6:14:00 PM
August 2011
Observer
19
TOP 10 NUCLEAR PLANTS WITH HIGHEST INSTALLED CAPACITY
Rank Station Country Capacity (Megawatts)
1. Kashiwazaki-Kariwa Japan 8,212
2. Bruce Canada 7,276
3. Zaporizhzhia Ukraine 6,000
4. Uljin South Korea 5,900
5. Yeonggwang South Korea 5,875
6. Gravelines France 5,706
7. Paluel France 5,528
8. Cattenom France 5,448
9. Bruce 2 Canada 5,090
10. Oi Japan 4,710

TOP 10 COUNTRIES WITH THE MOST NUCLEAR POWER UNITS
Rank Country No. of Reactors
1. United States 104
2. France 58
3. Japan 54
4. Russia 32
5. South Korea 21
6. India 20
7. United Kingdom 19
8. Canada 18
9. Germany 17
10. Ukraine 15
TOP 10 COUNTRIES LEADING IN URANIUM MINING
Rank Countries Uranium in tonnes
1. Kazakhstan 17,803
2. Canada 9,783
3. Australia 5,900
4. Namibia 4,496
5. Niger 4,198
6. Russia 3,562
7. Uzbekistan 2,400
8. USA 1,660
9. Ukraine 850
10. China 827
The World
Top 10
SOURCE: ANEKI.COM
WORLD-NUCLEAR.ORG
Dubai InLornaLionaI AirporL was givon Lho groon IighLfor a $,.8
biIIion airporL and airspaco oxpansion programmo in JuIv, which
wiII boosL capaciLv aL Dubai InLornaLionaI from 6u miIIion Lo 0u
miIIion passongors por voar bv 2u18.
Tho pIan, which was prosonLod Lo Lho Vico-ProsidonL and
Primo MinisLor of Lho UAE and RuIor of Dubai, Shoikh
Mohammod bin Rashid AI MakLoum, wiII doIivor aviaLion
infrasLrucLuro Lo supporL Lho socLor`s conLinuod growLh, faciIiLaLo
Dubai`s oconomic oxpansion and gonoraLo 22 por conL of LoLaI
ompIovmonL and 32 por conL of Lho omiraLo`s GDP bv 2u2u.
Tho pIan is a rosponso Lo a 1u-voar Lraffic forocasL for Dubai
InLornaLionaI and Dubai WorId ConLraI LhaL projocLs inLornaLionaI
passongor and cargo Lraffic wiII incroaso aL an avorago annuaI
growLh raLo of ,.2 por conL and 6., por conL, rospocLivoIv.
Tho combinaLion of raIIving Lourism, Dubai`s proximiLv Lo
Lho omorging oconomios of India and China, and Lho omiraLos`
osLabIishod roIo as a Lrading hub, is LogoLhor oxpocLod Lo drivo
Lraffic growLh and furLhor oIovaLo Dubai`s sLaLus as a gIobaI
conLro for aviaLion," Shoikh Ahmod bin Saood AI MakLoum, Lho
Chairman of Dubai AirporLs and ProsidonL of Lho Dubai CiviI
AviaLion AuLhoriLv, said in a sLaLomonL.
Tho sLraLogv incIudos aggrossivo oxpansion pIans for airspaco,
airfioId, aircrafL sLands and LorminaI aroas aL Dubai InLornaLionaI
ovor Lho romaindor of Lho docado.
Dubai Plans Ahead
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Repairing Genetic Defects
IAN SAMPLE
=
H<MHKLA:O>MK>:M>=:
Iifo-LhroaLoning bIood disoaso
bv ropairing fIaws in Lho gonoLic
codo of a Iiving animaI, Lho firsL Limo such
an ambiLious foaL has boon achiovod. This
work raisos Lho prospocL of poworfuI now
Lhorapios LhaL can LargoL and ropair Lho
gonoLic dofocLs bohind a wido rango of
human disoasos LhaL cannoL bo LackIod
wiLh modorn modicinos.
Tho now Lochniquo, caIIod gonomo
odiLing, hoIds parLicuIar promiso for a
group of iIInossos LhaL run in famiIios and
aro causod bv fauILs in gonos LhaL undorpin
Lho hoaILhv working of Lho immuno svsLom,
bono marrow and Iivor.
To domonsLraLo Lho Lhorapv, rosoarchors
LroaLod mico LhaL woro brod Lo dovoIop
haomophiIia B, an inhoriLod bIooding
disordor LhaL dosLrovs Lho bodv`s abiIiLv Lo
form bIood cIoLs.
NormaIIv, whon Lho bodv suffors a cuL
or grazo, proLoins caIIod cIoLLing facLors
combino wiLh pIaLoIoL coIIs in Lho bIood
Lo mako iL sLickv and form a cIoL LhaL
sLops anv bIooding. BuL poopIo born wiLh
haomophiIia B carrv a dofocL in a gono
LhaL makos cIoLLing proLoins, Ioaving Lhom
vuInorabIo Lo oxcossivo bIooding.
AbouL ono in 3u,uuu bovs aro born wiLh
haomophiIia B which, aL iLs mosL sovoro,
roquiros paLionLs Lo havo froquonL infusions
of bIood cIoLLing facLors Lo provonL
sponLanoous haomorrhagos.
In a roporL in Lho journaI GZmnk^, a Loam
Iod bv KaLhorino High aL Lho ChiIdron`s
HospiLaI of PhiIadoIphia doscribos how
gonomo odiLing rovorsod haomophiIia B in
mico, rosLoring Lhoir bIood cIoLLing Limos Lo
noar-normaI wiLhouL causing anv apparonL
sido offocLs.
High, Lho dirocLor of Lho ConLro for
CoIIuIar and MoIocuIar ThorapouLics aL
Lho hospiLaI, said LhaL Lho work showod
gonomo odiLing couId achiovo cIinicaIIv
moaningfuI rosuILs` in Iiving animaIs.
Tho compIoxiLv of Lho LroaLmonL
rofIocLs Lho oxquisiLo moIocuIar
Lho fauILv gono, causing Lho coII Lo
Iaunch an omorgoncv ropair offorL.
AL Lhis poinL, Lho socond sLago of Lho
Lhorapv swings inLo acLion. InjocLod wiLh
Lho onzvmos aro DNA LompIaLos of Lho
hoaILhv bIood-cIoLLing gono. Thoso food
inLo Lho coII`s ropair machinorv and,
insLoad of simpIv fixing Lho sIicod gono,
a now, working copv is croaLod.
High`s Loam found Lho Lochniquo
was inofficionL and raisod Lho IovoI of
Lho cIoLLing proLoin, caIIod facLor 0,
onIv marginaIIv, Lo abouL fivo por conL
of normaI IovoIs, buL Lhis was onough
Lo havo a dramaLic impacL on Lho
animaIs` hoaILh. If vou havo fivo
por conL of facLor 0, vou wiII havo
miId haomophiIia insLoad of sovoro
haomophiIia and Lho difforonco is hugo.
PoopIo wiLh miId haomophiIia usuaIIv
onIv bIood if Lhov aro in surgorv or suffor
a Lrauma,` High said.
Tho work has boon soon as a woIcomo
broakLhrough in a fioId LhaL has sLruggIod
Lo doIivor on Lho promiso manv scionLisLs
boIiovo iL hoIds.
Wasoom Oasim, who works on gono
Lhorapios aL Lho InsLiLuLo of ChiId HoaILh
in London, said: Tho concopL of gono
Lhorapv has boon around for 2 voars
or so and wo aro proLLv crudo aL iL; wo
aro basicaIIv adding copios of gonos
LhaL aro dofocLivo. BuL whaL Lhov havo
dono is insorL a corrocLod copv of Lho
gono oxacLIv whoro iL shouId bo, and
LhaL moans iL is proporIv conLroIIod
and swiLchod on and off as iL shouId bo.
This has roaIIv boon Lho hoIv graiI for
Lhoso kinds of Lhorapios and Lo soo LhaL
somoono has goL Lhis Lo work in a Iiving
animaI is vorv improssivo.`
choroographv LhaL scionLisLs can now
achiovo wiLh modorn gonoLic LochnoIogv.
In Lho firsL sLago of Lho Lhorapv, Lho
mico woro injocLod wiLh onzvmos hiddon
in harmIoss virus shoIIs LhaL find Lhoir
wav Lo Lho Iivor whoro bIood cIoLLing
proLoins aro mado.
Onco Lhoro, Lho virusos smuggIo Lho
onzvmos inLo Iivor coIIs, whoro Lhov homo
in on Lho spocific gono soquonco LhaL is
dofocLivo in haomophiIia B. Having arrivod
aL Lhoir LargoL, Lho onzvmos sIico Lhrough
Enzymes are injected into harmless virus
shells that transport the specific gene
sequence to where it is needed in the body.
20 Column.indd 20 7/21/11 9:09:58 AM
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22
THERES
NOTHING NEW
IN BULK BUYING
AND NEGOTIATING
DISCOUNTS.
BUT GROUPON
DOES IT IN 47
COUNTRIES FOR
MORE THAN 70
MILLION PEOPLE.
ITS AN IDEA SO
SIMPLE ANYONE
COULD HAVE
THOUGHT OF IT.
UNFORTUNATELY,
ANDREW MASON
GOT THERE
FIRST AND NOW
HES SITTING ON A
COMPANY WORTH
$30 BILLION,
REPORTS OLIVER
BURKEMAN.
?HNKR>:KL:@H%:E:K@>&EBF;>=+/&R>:K&
oId from PiLLsburgh namod Androw Mason Iaunchod
a wobsiLo caIIod Tho PoinL. Tho poinL of Tho PoinL,
immodosLIv, was Lo soIvo Lho worId`s unsoIvabIo probIoms,`
harnossing Lho coIIocLivo poLonLiaI of Lho inLornoL Lo Iobbv
for sociaI jusLico. Campaignors couId wioId far groaLor
powor bv pIodging Lo givo monov or Lako acLion - buL onIv
if a corLain numbor of oLhors did Lho samo. Thoro wasn`L
a businoss modoI Lo spoak of, buL Mason didn`L roaIIv caro:
aL hoarL, ho was a IofL-Ioaning musician who pIavod piano
in a rock band and had, as ho rocaIIs, an aIIorgic roacLion
Lo Lho idoa of making monov`.
IL was onIv undor prossuro from Tho PoinL`s main
invosLor LhaL ho sLarLod Iooking for wavs Lo mako iL pav
for iLsoIf. Whv noL, Mason wondorod, adapL Lho coIIocLivo-
pIodging idoa Lo, sav, pizza? A pizzoria, in a quioL poriod,
couId offor 6u por conL off a quaLLro formaggi - much
biggor Lhan Lho usuaI discounL - buL onIv if a sufficionL
numbor of cusLomors boughL Lho doaI in advanco, Lhus
oIiminaLing aII risk for Lho rosLauranL. Tho PoinL, as Lho
middIoman, couId Lako a porconLago. Tho pizza pIaco in
Lhoir offico buiIding provod wiIIing Lo givo iL a Lrv.
And iL was probabIv somo Limo around Lhon,` Mason savs
Lodav, Iooking as if ho sLiII doosn`L fuIIv undorsLand whaL
happonod noxL, which is fair onough, bocauso nobodv oIso
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Andrew Mason is set to become a
billionaire when the company goes
public. Groupon has already filed
the necessary paperwork with the
Securities and Exchange Commission.
August 2011
22-27 Cover Story.indd 23 7/20/11 5:28:23 PM
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CMYK
doos oiLhor, LhaL wo had Lhis roaIisaLion.`
IL was around Lho samo Limo LhaL
Mason`s aIIorgv Lo making monov sooms
Lo havo vanishod ovornighL. Which was
forLunaLo, in hindsighL, bocauso roconLIv
ho has boon making quiLo a biL of iL.
IL is moving dav whon I arrivo aL Lho
Chicago hoad offico of Groupon, Lho
companv LhaL omorgod from LhaL iniLiaI
pizza-discounL idoa. BuL Lhon again, as
moro Lhan ono sLaff mombor poinLs ouL,
iL ofLon is: whon vou`ro adding moro Lhan
1u ompIovoos ovorv monLh in Lho US
aIono, no offico spaco sLavs big onough for
Iong. WhaL sLarLod in ono cornor of ono
fIoor now occupios four fIoors - Lodav`s
movo invoIvos coIonising a fifLh - as woII
as anoLhor buiIding down Lho sLrooL,
anoLhor across Lown, and officos of various
sizos in 4, counLrios across Lho worId.
JusL Lwo-and-a-haIf voars sinco iL was
Iaunchod, Groupon has moro Lhan ,u
miIIion subscribors; iLs rovonuo for 2u1u
oxcoodod $,uu miIIion. LaLo IasL voar,
iL asLonishod Lho worId of LochnoIogv
financing bv rojocLing a Lakoovor bid from
GoogIo worLh $6 biIIion. RaLhor, Groupon
confirmod pIans Lo go pubIic, aiming Lo
raiso a sum LhaL wouId mako Lho companv
worLh around $3u biIIion, highor Lhan Lho
vaIuo of GoogIo whon iL firsL did Lho samo.
IL is, aL IoasL according Lo Lho
caIcuIaLions of?hk[^l magazino, Lho
fasLosL-growing companv in Lho hisLorv of
capiLaIism. Thoso davs, iL`s noL uncommon
Lo hoar normaIIv sobor commonLaLors
LaIk abouL Mason as if ho had discovorod
somo hiLhorLo socroL IoophoIo in Lho
fundamonLaI Iaws of businoss.
Evon if vou`ro a roguIar usor of
Groupon, or rivaI 'daiIv doaI` siLos such as
LivingSociaI, Lhis kind of LaIk mav sLriko
vou as a IiLLIo absurd. Suro, Groupon is
fun: oach morning, vou opon vour omaiI
Lo discovor ono or Lwo offors of sLoop
discounLs on rosLauranL food, or boauLv
LroaLmonLs, or advonLurous oxporioncos:
roconL London doaIs, for oxampIo,
incIudod 4 por conL off a kiLo-surfing
courso, and Lapas for Lwo aL 10 insLoad
of 48. NominaIIv, Lhoro`s a caLch - vou
goL Lho doaI onIv if iL 'Lips`, moaning LhaL a
sufficionL numbor of poopIo sign up - buL
Lodav LhaL aImosL aIwavs happons.
<HFI:K>=PBMA manv of Lho wob`s
major succoss sLorios, Lho idoa bohind
Groupon sooms aImosL offonsivoIv simpIo.
Bo honosL: vou couIdn`L havo como up
wiLh GoogIo`s PagoRank aIgoriLhm, which
caLapuILod iL Lo firsL pIaco among soarch
onginos, and vou couIdn`L havo wriLLon Lho
compuLor codo LhaL onabIos vidoo-sharing
on YouTubo. BuL if vou`vo ovor organisod
a wodding or a parLv, vou`vo probabIv
aIroadv nogoLiaLod a group discounL.
Groupon jusL doos Lho samo via omaiI.
ILs coasoIoss phvsicaI oxpansion, in Lorms
of ompIovoos and offico spaco, LosLifios Lo
Lho facL LhaL iL is, from ono angIo, a vorv
LradiLionaI businoss. Groupon noods saIos
porsonnoI Lo sLriko doaIs wiLh morchanLs,
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25
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advorLising wriLors Lo composo advorLising
copv, and Iogions of cusLomor sorvico
rops; iL curronLIv has a gIobaI workforco of
aImosL 8,uuu poopIo.
IL confusos mo, honosLIv, LhaL Lhis
idoa Look so Iong Lo bo LhoughL of,` savs
Mason, drinking coffoo from a papor
cup. In music, vou`vo goL Lhousands
and Lhousands of voars of groaL idoas
LhaL havo aIroadv boon LhoughL of. BuL
Lho inLornoL is basicaIIv 2u voars oId. So
vou can bo wav sLupidor and sLiII havo
worId-changing idoas. So vos, iL is simpIo.`
Ho Iaughs. IL`s ridicuIousIv, onormousIv
simpIo. IL`s sLiII a goId rush. Anv hick can
show up and find a nuggoL.`
@KHNIHGLA>:=JN:KM>KL%
as ono mighL oxpocL of anv ascondanL
inLornoL firm, is a buzzing hivo of casuaIIv
drossod, caffoino-dopondonL, oarbud-
woaring LwonLvsomoLhings. Tho waIIs
aro pIasLorod wiLh handmado posLors
and PhoLoshoppod imagos porpoLuaLing
oIaboraLo insido-jokos. Thoro is sLiII a
doLocLibIo sonso of Lho onLiro oporaLion as
an ironic saLiro on Lho idoa of running a
muILinaLionaI companv, as if nobodv can
quiLo Lako Lho idoa soriousIv.
AII Lhis humour, Lhough, can dofIocL
aLLonLion from Lho MachiavoIIian
manipuIaLion LhaL Iios aL Groupon`s coro.
NoL unusuaIIv for monov-off doaIs, Lhoro`s
a buiIL-in Limo IimiL; somo offors oxpiro
wiLhin 24 hours, oLhors in a fow davs. BuL
Lho vouchor, onco purchasod, is usuaIIv
vaIid for sovoraI monLhs, so buvors aron`L
puL off bv Lho noLion of having Lo disrupL
Lhoir schoduIos in Lho noar fuLuro. Tho
risk LhaL an insufficionL numbor of poopIo
mighL opL for Lho doaI unwiLLingIv Lurns
vou inLo an unpaid saIosporson, sproading
Lho word among famiIv and frionds. Paving
upfronL acLs as a mochanism of 'sLraLogic
pro-commiLmonL`, making iL IikoIior LhaL
vou` II ovorcomo vour naLuraI Londoncv
Lowards inorLia and mako a concroLo pIan;
Lhon again, porhaps vou`ro kidding voursoIf,
IT CONFUSES
ME, HONESTLY,
THAT THIS
IDEA TOOK
SO LONG TO
BE THOUGHT
OF. INTERNET
IS BASICALLY
20 YEARS
OLD. SO YOU
CAN BE WAY
STUPIDER
AND STILL
HAVE WORLD-
CHANGING
IDEAS. SO YES,
IT IS SIMPLE.
Above: A Groupon team member works
at the companys headquarters in
Chicago, Illinois.
Left: Mason accepts the Breakout of
the Year award during this years annual
Webby Awards in New York.
Groupon made revenue of $30.47
million in 2009 and $713.4 million in
2010. Yet Groupon hasnt turned a
net profit in any of its first three years
of operations, including a net loss of
$389.6 million in 2010.
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CMYK
26
wiLh a biggor, doopor purposo`, and iL is
an unusuaI ono for a wob onLropronour:
goLLing poopIo Lo spond Ioss Limo onIino.
Wo`ro rovorsing Lhis Lrond of sponding
moro and moro Limo in fronL of Lho
compuLor, hoIping poopIo romombor LhaL
Lhoro`s somo roaIIv cooI sLuff offIino as woII.`
BuL Lhoro is, of courso, an onLiroIv
difforonL wav of undorsLanding sorvicos
such as Groupon, which is LhaL Lhov aro
ongagod in porsuading vou Lo parL wiLh
monov for Lhings vou novor LhoughL vou
wanLod - or, moro procisoIv, acLuaIIv didn`L
wanL boforo rocoiving a 'doaI of Lho dav`
omaiI. You woro fooIing fino, buL now vou`ro
worriod vou`ro insufficionLIv advonLurous
for having novor Lriod rock-cIimbing.
Thoro is a corLain doprossing inoviLabiIiLv
in Ioarning LhaL Lho firsL coupon in hisLorv
was croaLod in 1888 bv Lho Coca-CoIa
companv. IL offorod Lho boaror ono gIass
of froo Coca-CoIa aL Lho founLain of anv
disponsor of gonuino Coca-CoIa`, and iL
workod: bv 1013, 8. miIIion froo drinks
had boon cIaimod, and Lho companv was
on iLs wav Lo sofL-drink dominanco.
TradiLionaI coupons work bv oxpIoiLing
whaL oconomisLs caII 'prico discriminaLion`.
If vou aro, sav, a bakor making chocoIaLo
cakos LhaL cosL 1 oach Lo produco, soIIing
Lhom aL 1.8u guaranLoos a hoaILhv profiL.
BuL iL aIso moans sacrificing aII Lhoso
and vou`II novor goL around Lo rodooming
Lho coupon. Groupon makos pIonLv of
monov oiLhor wav: iLs cuL is commonIv u
por conL of Lho coupon`s vaIuo, and in Lho
UK, aL IoasL, Lhov koop 1uu por conL if iL`s
novor rodoomod.
?KHFMA> porspocLivo LhaL Mason
and his coIIoaguos Iiko Lo omphasiso,
Groupon is far moro Lhan a suppIior of
monov-off doaIs. IL is a discovorv ongino`
- a mochanism for forcing us ouL of our
comforL zonos and finding fuIfiImonL.
Whon wo docidod Lo LransiLion from
saving Lho worId Lo hawking coupons, wo
LhoughL Lo oursoIvos, 'OK, how can wo do
Lhis in a wav LhaL`s noL going Lo mako us
wanL Lo kiII oursoIvos?`` Mason savs. So
Lho idoa was Lo croaLo somoLhing LhaL was
jusL as much a ciLv guido, or a wav Lo puL
Lho spoLIighL on inLorosLing or unusuaI
oxporioncos LhaL poopIo wouIdn`L normaIIv
havo. Tho discounL wouId bo a wav Lo
roduco Lho risk of sLopping ouLsido vour
comforL zono and Lrving somoLhing now. I
wasn`L inLorosLod so much in Iuxurv goods
- in goLLing poopIo Lo buv Lhoir 8uLh
purso, or somoLhing Iiko LhaL - bocauso iL`s
jusL moro sLuff poopIo don`L nood. I Lhink
wo`ro Lricking poopIo inLo doing sLuff LhaL`s
going Lo mako Lhoir Iivos boLLor.`
His concopL of himsoIf is as somoono
THE IDEA WAS
TO CREATE
SOMETHING
THAT WAS JUST
AS MUCH A CITY
GUIDE, OR A
WAY TO PUT THE
SPOTLIGHT ON
INTERESTING
OR UNUSUAL
EXPERIENCES
THAT PEOPLE
WOULDNT
NORMALLY HAVE.
THE DISCOUNT
WOULD BE A
WAY TO REDUCE
THE RISK OF
STEPPING
OUTSIDE YOUR
COMFORT ZONE
AND TRYING
SOMETHING NEW.
Mason has become a popular speaker at internet conferences,
especially after turning down a $6 billion deal from Google.
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'prico-sonsiLivo` cusLomors who won`L
pav 1.8u buL wouId pav 1.3u, sLiII a
profiLabIo saIo. A up-off coupon aIIows
Lho cako-soIIor Lho bosL of boLh worIds:
big profiLs from mosL poopIo, and smaIIor
profiLs from Lhoso who aro wiIIing Lo puL
in Lho offorL roquirod Lo IocaLo, cuL ouL and
romombor Lo uso Lho coupon.
WhaL`s going on wiLh Groupon is
significanLIv moro mvsLorious and compIox -
Lo Lho oxLonL, indood, LhaL noiLhor oconomic
commonLaLors nor Lho businossos LhaL
parLicipaLo can agroo on whoLhor Laking parL
makos sonso for Lho morchanL. Bv promising
Lhousands of now cusLomors, paving in
advanco, Groupon can nogoLiaLo much
doopor discounLs, and koops haIf Lho cash
anvwav, so Lho coupon iLsoIf is IikoIv Lo rosuIL
in a much smaIIor profiL, or ovon a Ioss.
Groupon is Ioss abouL prico discriminaLion,
Lhon, Lhan iL is a proviousIv unoxpIorod
branch of advorLising: morchanLs hopo Lo
win now roguIar cusLomors, and Lo bonofiL
from word-of-mouLh.
HG>MABG@I`vo como Lo Ioarn
abouL mvsoIf,` Mason savs, is LhaL I
havo Lo koop going. I Iook aL boing a
capiLaIisL businossporson Iiko riding a
biko - if I go Loo sIowIv, I` II faII ovor.`
Honco Lho IogicaI noxL sLop, a smarLphono
appIicaLion caIIod Groupon Now!, which
roconLIv Iaunchod in sovoraI US ciLios. IL`s
woIcomo scroon dispIavs jusL Lwo buLLons
LhaL boLwoon Lhom diagnoso Lho modorn
human condiLion: 'I`m Hungrv` and 'I`m
Borod`. UnIiko daiIv-doaI omaiIs, Groupon
Now! Lakos advanLago of vour phono`s
gooIocaLion capabiIiLios Lo work in roaI
Limo: cIicking 'I`m Hungrv` wiII noLifv vou
of rosLauranLs offoring group discounLs
wiLhin a shorL waIk of whorovor vou aro.
('I`m Borod` doos Lho samo, oxcopL wiLh
oxporioncos Lo hoIp pass Lho Limo.) In
Mason`s droams, vou wouIdn`L Lhink abouL
Groupon onIv whon iLs omaiIs arrivod;
insLoad, iL wouId pormoaLo vour onLiro
oxporionco of IocaI shopping, Lurning vour
phono inLo a forum whoro morchanLs
compoLo, minuLo-bv-minuLo, Lo soduco
vou. Think abouL iL,` Mason savs. If I
couId goL a doaI on whaLovor mv impuIso
was, whonovor mv impuIso sLruck, and iL
was noarbv, I wouId uso LhaL aII Lho Limo.
IL wouId roshapo Lho wav LhaL I shop.`
Tho sLandard Lako on aII Lhis is LhaL
Groupon is moroIv faciIiLaLing a moro
porfocL oxchango of informaLion, Ioaving
ovorvono happior. And voL Groupon Now!,
bv Lhrowing Lho group-doaI procoss inLo
vivid roIiof, poinLs Lo anoLhor inLorproLaLion.
If Lho sociaI, mobiIo inLornoL is a goId rush,
Lho goId isn`L roaIIv choapor pizzas or kiLo-
surfing cIassos. IL is vour aLLonLion, which
Groupon soIIs Lo whichovor morchanL is
wiIIing Lo namo Lho bosL prico. Thoro`s
noLhing inhoronLIv wrong wiLh Lhis. IL`s
how advorLising has aIwavs workod.
BuL advorLising is somoLhing wo usuaIIv
jusL LoIoraLo; raroIv has parLicipaLing
in Lho procoss of boing advorLisod Lo
boon dosignod Lo bo so ongrossing or
addicLivo. WhiIo iL mav bo Lruo LhaL
vou`ro goLLing a briIIianL doaI, iL`s oquaIIv
Lruo Lo sav LhaL vou`ro Lho producL.
Above: Eric Lefkofsky (R) and Brad Keywell (L) at the
headquarters of Groupon. A few years ago Lefkofsky and
Keywell put some seed funding behind 30-year-old Groupon
founder Andrew Masons viral couponing concept.
Right: Mason joined the likes of Mark Zuckerberg on last
years Young Rich List 30 Under 30 Internet Millionaires.
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August 2011
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'prico-sonsiLivo` cusLomors who won`L
pav 1.8u buL wouId pav 1.3u, sLiII a
profiLabIo saIo. A up-off coupon aIIows
Lho cako-soIIor Lho bosL of boLh worIds:
big profiLs from mosL poopIo, and smaIIor
profiLs from Lhoso who aro wiIIing Lo puL
in Lho offorL roquirod Lo IocaLo, cuL ouL and
romombor Lo uso Lho coupon.
WhaL`s going on wiLh Groupon is
significanLIv moro mvsLorious and compIox -
Lo Lho oxLonL, indood, LhaL noiLhor oconomic
commonLaLors nor Lho businossos LhaL
parLicipaLo can agroo on whoLhor Laking parL
makos sonso for Lho morchanL. Bv promising
Lhousands of now cusLomors, paving in
advanco, Groupon can nogoLiaLo much
doopor discounLs, and koops haIf Lho cash
anvwav, so Lho coupon iLsoIf is IikoIv Lo rosuIL
in a much smaIIor profiL, or ovon a Ioss.
Groupon is Ioss abouL prico discriminaLion,
Lhon, Lhan iL is a proviousIv unoxpIorod
branch of advorLising: morchanLs hopo Lo
win now roguIar cusLomors, and Lo bonofiL
from word-of-mouLh.
HG>MABG@I`vo como Lo Ioarn
abouL mvsoIf,` Mason savs, is LhaL I
havo Lo koop going. I Iook aL boing a
capiLaIisL businossporson Iiko riding a
biko - if I go Loo sIowIv, I` II faII ovor.`
Honco Lho IogicaI noxL sLop, a smarLphono
appIicaLion caIIod Groupon Now!, which
roconLIv Iaunchod in sovoraI US ciLios. IL`s
woIcomo scroon dispIavs jusL Lwo buLLons
LhaL boLwoon Lhom diagnoso Lho modorn
human condiLion: 'I`m Hungrv` and 'I`m
Borod`. UnIiko daiIv-doaI omaiIs, Groupon
Now! Lakos advanLago of vour phono`s
gooIocaLion capabiIiLios Lo work in roaI
Limo: cIicking 'I`m Hungrv` wiII noLifv vou
of rosLauranLs offoring group discounLs
wiLhin a shorL waIk of whorovor vou aro.
('I`m Borod` doos Lho samo, oxcopL wiLh
oxporioncos Lo hoIp pass Lho Limo.) In
Mason`s droams, vou wouIdn`L Lhink abouL
Groupon onIv whon iLs omaiIs arrivod;
insLoad, iL wouId pormoaLo vour onLiro
oxporionco of IocaI shopping, Lurning vour
phono inLo a forum whoro morchanLs
compoLo, minuLo-bv-minuLo, Lo soduco
vou. Think abouL iL,` Mason savs. If I
couId goL a doaI on whaLovor mv impuIso
was, whonovor mv impuIso sLruck, and iL
was noarbv, I wouId uso LhaL aII Lho Limo.
IL wouId roshapo Lho wav LhaL I shop.`
Tho sLandard Lako on aII Lhis is LhaL
Groupon is moroIv faciIiLaLing a moro
porfocL oxchango of informaLion, Ioaving
ovorvono happior. And voL Groupon Now!,
bv Lhrowing Lho group-doaI procoss inLo
vivid roIiof, poinLs Lo anoLhor inLorproLaLion.
If Lho sociaI, mobiIo inLornoL is a goId rush,
Lho goId isn`L roaIIv choapor pizzas or kiLo-
surfing cIassos. IL is vour aLLonLion, which
Groupon soIIs Lo whichovor morchanL is
wiIIing Lo namo Lho bosL prico. Thoro`s
noLhing inhoronLIv wrong wiLh Lhis. IL`s
how advorLising has aIwavs workod.
BuL advorLising is somoLhing wo usuaIIv
jusL LoIoraLo; raroIv has parLicipaLing
in Lho procoss of boing advorLisod Lo
boon dosignod Lo bo so ongrossing or
addicLivo. WhiIo iL mav bo Lruo LhaL
vou`ro goLLing a briIIianL doaI, iL`s oquaIIv
Lruo Lo sav LhaL vou`ro Lho producL.
Above: Eric Lefkofsky (R) and Brad Keywell (L) at the
headquarters of Groupon. A few years ago Lefkofsky and
Keywell put some seed funding behind 30-year-old Groupon
founder Andrew Masons viral couponing concept.
Right: Mason joined the likes of Mark Zuckerberg on last
years Young Rich List 30 Under 30 Internet Millionaires.
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svsLom was dosignod in parL bv sampIing
Russian Iaw onforcomonL daLabasos of
rocordod voicos of poopIo found Lo bo
Iving during poIico inLorrogaLions.
Tho big bank invoIvod, Sborbank,
whoso majoriLv ownor is Lho Russian
govornmonL, said iL inLondod Lo insLaII Lho
now machinos in maIIs and bank branchos
around Lho counLrv ovonLuaIIv, buL had
noL voL schoduIod Lho roIIouL. TochnoIogv
consuILanLs sav Lho machinos, if Lhov go
inLo commorciaI uso, wouId bo Lho banking
worId`s firsL uso of voico anaIvsis in ATMs.
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An ATM That Detects Lies
A major Russian bank is developing an ATM that uses voice-analysis software to detect
nervousness or emotional distress, possible indications that a credit applicant is being
economical with the truth, reports Andrew Kramer.
KNLLB:L;B@@>LMK>M:BE;:GD
is LosLing a machino LhaL Lho oId KGB
mighL havo Iovod, an ATM wiLh a buiIL-in
Iio doLocLor inLondod Lo provonL consumor
crodiL fraud.
Consumors wiLh no provious
roIaLionship wiLh Lho bank couId LaIk
Lo Lho machino Lo appIv for a crodiL card,
wiLh no human inLorvonLion roquirod
on Lho bank`s ond. Tho machino scans a
passporL, rocords fingorprinLs and Lakos
a 3-D scan for faciaI rocogniLion.
And iL usos voico-anaIvsis sofLwaro Lo
hoIp assoss whoLhor Lho porson is LruLhfuIIv
answoring quosLions LhaL incIudo Aro vou
ompIovod?` and AL Lhis momonL, do vou
havo anv oLhor ouLsLanding Ioans?`
Tho voico-anaIvsis svsLom was
dovoIopod bv Lho Spooch TochnoIogv
ConLro, a companv whoso oLhor big
cIionLs incIudo Lho IodoraI SocuriLv
Sorvico - Lho Russian domosLic
inLoIIigonco agoncv doscondod from Lho
SovioL KGB.
DmiLri Dvrmovskv, dirocLor of Lho
conLro`s Moscow officos, said Lho now
28-30 ATM.indd 28 7/20/11 6:17:54 PM
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offico buiIding abovo a Moscow subwav
sLaLion. Tho Iab brisLIos wiLh biomoLric
survoiIIanco LochnoIogv. Whon a porson
waIks in, a faciaI-rocogniLion camora
Lakos noLo, and an arLificiaI voico chooriIv
grooLs known cusLomors. Or, moro ofLon,
iL uLLors a gIum HoIIo, vou aro noL
rogisLorod,` bocauso onIv a fow of Lho Iab`s
sLaff havo had Lhoir facos scannod so far.
Sborbank savs LhaL Lo compIv wiLh
Lho parL of Lho privacv Iaw LhaL wouId
prohibiL a companv from kooping a
daLabaso of cusLomors` voico signaLuros,
Lho bank pIans Lo sLoro cusLomors` voico
prinLs on chips conLainod in Lhoir crodiL
cards. OrIovskv, Lho Sborbank vico
prosidonL, said LhaL Lo addross privacv
concorns Lho bank aIso pIannod Lo
mako consumors awaro of Lho Lvpos of
informaLion, incIuding biomoLrics, LhaL
Lho ATM wouId bo coIIocLing.
BuL Lho Spooch TochnoIogv ConLro
savs ovon poopIo who know abouL
Lho voico-sLross program wouId havo
LroubIo fooIing iL, bocauso iL moasuros
invoIunLarv norvous rosponsos, Lho wav
a poIvgraph LosL doos.
WhiIo Sborbank`s LochnoIogv mighL
sLriko WosLornors as Loo inLrusivo,
manv Russians aIroadv assumo Lho
govornmonL can waLch or IisLon Lo Lhom
whon iL choosos Lo. Sborbank oxocuLivos
said Lho now ATMs wouId adhoro Lo
Russian privacv Iaws.
BMP:L Lho gIobaI financiaI crisis, parLIv
prompLod bv Ioans LhaL poopIo couId
noL or wouId noL ropav, LhaL prompLod
Sborbank Lo Lap Russia`s naLionaI
socuriLv oxporLs as iL soL ouL Lo auLomaLo
mosL banking acLiviLios, said VicLor
OrIovskv, a sonior vico prosidonL for
LochnoIogv aL Lho bank.
Tho sofLwaro doLocLs norvousnoss or
omoLionaI disLross, possibIo indicaLions
LhaL a crodiL appIicanL is dissombIing.
ThaL informaLion, OrIovskv said, wouId
bo usod in combinaLion wiLh oLhor daLa,
incIuding crodiL hisLorv. Sborbank is
hardIv aIono in Iooking ovor Lho horizon
aL now Lvpos of banking auLomaLion.
DouLscho Bank and CiLigroup,
for oxampIo, aro LosLing fuLurisLic
LochnoIogios in a handfuI of bank
branchos in BorIin, Now York and
Tokvo. Thoso banks sav Lhoir offorLs
focus on now Lvpos of inLoracLivo
dispIavs and Louch-scroon LorminaIs,
such as a LabIo Lop mado bv MicrosofL
LhaL sonsos documonLs and oLhor iLoms
pIacod on iL. And crodiL approvaIs bv
ATM aro aIroadv a facL of financiaI
Iifo in Turkov, for ono, whoro Lho bank
machinos aro hoIping fuoI a consumor
crodiL boom LhaL somo anaIvsLs foar
couId spiraI inLo a dobL crisis.
BuL Sborbank mav bo uniquo so
far in Lrving Lo Lurn ATMs inLo LruLh
machinos.
Wo don`L know of anv major US
financiaI insLiLuLions doing Lhings aIong
Lhoso Iinos, such as Lrving Lo gaugo
whoLhor somobodv is Iving,` DanioI
Wiogand, a sonior anaIvsL aL CorporaLo
InsighL, a companv LhaL consuILs wiLh
banks on consumor LochnoIogv, said in
a LoIophono inLorviow.
:IKHMHMRI> of Lho machino is on
dispIav aL Sborbank`s Branch of Lho
IuLuro IaboraLorv in a nondoscripL
The software detects nervousness or emotional distress, possible
indications that a credit applicant is dissembling.
August 2011
Dmitri Myrmovsky, a director at the Speech
Technology Centre, says the companys
software recognises when a person becomes
agitated by analysing speech patterns.
28-30 ATM.indd 29 7/20/11 6:17:56 PM
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Tho conLro`s dirocLor, Dvrmovskv,
said Lho voico-sLross svsLom anaIvsod
vibraLions as shapod bv Lho conLours
of an individuaI`s LhroaL, Iarvnx and
oLhor Lissuo invoIvod in spooch. Whon
a porson bocomos agiLaLod, ho said,
invoIunLarv norvous roacLions aILor
Lhoso shapos, changing Lho Lono and
pacing of spooch.
Ono of Lho conLro`s oLhor producLs
moasuros angor. IL is aIroadv insLaIIod aL
Lho LoIophono caII conLro of Lho Russian
naLionaI raiIwavs. WiLhin soconds, Lho
compuLor can sorL incoming caIIs inLo
rod, voIIow, groon and bIuo caLogorios,
basod on Lho omoLionaI sLaLo of Lho
spoakor. Rod caIIs LvpicaIIv prompL a
suporvisor Lo IisLon in.
In a domonsLraLion, Lochnicians
pIavod a rocording of an acLuaI caII LhaL
causod Lho program Lo iIIuminaLo a rod
doL noxL Lo a phono numbor dispIavod
on Lho scroon. IL was Lho voico of a
passongor who had jusL Ioarnod sho
couId noL Lako hor smaII dog onLo a
firsL-cIass car. Do vou know how much
a LickoL cosLs? Yos, iL`s big monov, and
vou aro LoIIing mo I cannoL bring a
dog?` Lho woman said. Tho dog, iL`s
no biggor Lhan, I don`L know, a pack of
cigaroLLos! WhaL shouId I do, Lhrow iL
ouL Lho window?`
Tho svsLom Lho conLro is dovoIoping
for Sborbank is a variaLion of LhaL
samo sofLwaro, inLondod Lo idonLifv
norvousnoss. Of courso, wo don`L boIiovo
Lhis LochnoIogv 1uu por conL,` said
OrIovskv, Lho Sborbank oxocuLivo. A cIionL
mighL bo norvous for roasons unroIaLod Lo
a crodiL appIicaLion, for oxampIo. Ho said
iL was moroIv a sLaLisLicaI guido.
And ho said Lho voico anaIvsis was
no moro invasivo Lhan chocking a
crodiL hisLorv. Wo aro noL vioIaLing a
cIionL`s privacv,` ho said. Wo aro noL
cIimbing inLo Lho cIionL`s brain. Wo
aron`L invading Lhoir porsonaI Iivos. Wo
aro jusL Lrving Lo find ouL if Lhov aro
LoIIing Lho LruLh. I don`L soo anv roason
Lo bo aIarmod.`
Citibank is experimenting
with new interactive
displays that provide a host
of banking services.
Touch-screen terminals, such as
this table top made by Microsoft,
can sense documents and other
items placed on it.
One of the centres other products
measures anger. It is already installed
at the telephone call centre of the
Russian national railways.
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Doctor, what can cryolipolysis
do for us?
Adipose tissue, although it
protects us from the cold, is also
more sensitive than other tissue
to exposure to intense cold!
Following ten years of research,
an innovative technology has been
developed for treating localised
areas such as love handles, rolls
of unwanted abdominal fat and,
of course, resistant fat deposits in
the back. The treatment produces
a loss of about 1-2 sizes following
a one to three hours` session.
The technology is sophisticated but the resulting treatment is
natural. What happens to the fat cells? Exposure to cold begins
a process by which only adipocytes or fat cells are reabsorbed
naturally. About 7 billion cells are damaged by the cold (between
0 C and 10 C) diffused by the system, which are then eliminated
physically by the body.
Is it a non-surgical treatment?
Exactly, cryolipolysis is a new, non-invasive, risk-free technique
for reducing unsightly local bulges without an anaesthetic or
injections. It can visibly reduce unwanted rolls of fat and that
reduction is perceptible, smooth and permanent. After the
treatment, a slight redness is usually observed lasting about half
an hour and, more unusually, there is superfcial bruising with no
consequence. Improvements start to appear after 4 weeks, and the
fnal results are achieved within three months.
With cryolipolysis, you can go back to your daily routine
immediately, although I would advise to go easy on sporting
activities for about a week as the treated areas may react causing
very slight pulling. It is a very natural and comfortable way of
shaping up one`s body. In fact the exposure to the cold creates an
anaesthetic effect, which is very much appreciated by our patients.
Who is cryolipolysis aimed at?
It`s ideal for men and women of any age and any skin type (apart
from those whose skin is already extremely slack) who have slight
local bulges. It is not a slimming method, but a true remodelling
technique.
And are the results permanent?
Yes, the treated fatty cells are destroyed for good.
What can you offer to those patients
who wish to lose more weight?
While cryolipolysis is a short-term treatment, we have also
developed a longer-term and a truly comprehensive weight loss
program, producing spectacular results. It is based on a highly
personalised approach, taking into consideration the needs of every
individual and the results of his medical tests. Our clients who
come to Switzerland for a longer stay enjoy the utmost benefts of
this method.
Hi-Tech Strategies to
Shape up Your Body
Love handles, tummy, unsightly back folds ~ what a pain! But cryolipolysis is the very latest treatment coming unfailingly to the
rescue! Read our interview with Dr. Emmenegger. As the Medical Director of the Clinic Lmanic she answers our questions about
the new non-surgical technique everyone is talking about!
Clinic Lmanic
Avenue de la Gare 2, 1003 Lausanne, Switzerland.
+41 21 321 20 82
info@cliniclemanic.ch
www.cliniclemanic.ch
CMYK
32
CANADIAN
PIPELINE
HITS A SNAG
The proposed Keystone XL
pipeline that aims to move oil from
Albertas tar sands to the United
States has been under intense
scrutiny by environmentalists,
reports Ian Austen.
HG>P:RHK:GHMA>K;RK:BEHKLABIHK:
g^mphkdh_ibi^ebg^l<ZgZ]Zpbee^qihkmhbe_khfbmloZlmghkma^kg
hbelZg]likhc^\mlmhma^Ngbm^]LmZm^lZg]hma^kfZkd^ml'Lhma^
k^`neZmhkr[Zmme^ho^kma^ikhihl^]D^rlmhg^QEibi^ebg^%pab\a
phne]ebgdma^hbelZg]lmhma^@ne_<hZlmh_ma^Ngbm^]LmZm^l%fZr
[^ebmme^fhk^maZgZlrf[heb\\eZlah_b]^heh`r%bg]nlmkr^qi^kmllZr'
>o^gb_ma^H[ZfZZ]fbgblmkZmbhgk^c^\mlma^D^rlmhg^ieZg%ma^iZ\^
h_hbelZg]l]^o^ehif^gmbgghkma^kg:e[^kmZblngebd^ermhlehp'
Hbeikh]n\^klbg<ZgZ]ZaZo^l^o^kZeZem^kgZmbo^l_hkk^Z\abg`ma^
Ngbm^]LmZm^lfZkd^m':g]k^\^gmbgo^lmf^gml[r<abg^l^\hfiZgb^l
bgma^hbelZg]lln``^lmmaZmZ`khpbg`Zem^kgZmbo^fZkd^meb^lZ\khll
ma^IZ\b_b\'Ma^<ZgZ]bZghbelZg]lpbee\hgmbgn^mh[^]^o^ehi^]
bkk^li^\mbo^h_pa^ma^kma^ibi^ebg^`h^lZa^Z]%lZb]Knll^ee@bkebg`%


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32-36 Canada Pipeline.indd 32 7/20/11 4:40:44 PM
CMYK
32
CANADIAN
PIPELINE
HITS A SNAG
The proposed Keystone XL
pipeline that aims to move oil from
Albertas tar sands to the United
States has been under intense
scrutiny by environmentalists,
reports Ian Austen.
HG>P:RHK:GHMA>K;RK:BEHKLABIHK:
g^mphkdh_ibi^ebg^l<ZgZ]Zpbee^qihkmhbe_khfbmloZlmghkma^kg
hbelZg]likhc^\mlmhma^Ngbm^]LmZm^lZg]hma^kfZkd^ml'Lhma^
k^`neZmhkr[Zmme^ho^kma^ikhihl^]D^rlmhg^QEibi^ebg^%pab\a
phne]ebgdma^hbelZg]lmhma^@ne_<hZlmh_ma^Ngbm^]LmZm^l%fZr
[^ebmme^fhk^maZgZlrf[heb\\eZlah_b]^heh`r%bg]nlmkr^qi^kmllZr'
>o^gb_ma^H[ZfZZ]fbgblmkZmbhgk^c^\mlma^D^rlmhg^ieZg%ma^iZ\^
h_hbelZg]l]^o^ehif^gmbgghkma^kg:e[^kmZblngebd^ermhlehp'
Hbeikh]n\^klbg<ZgZ]ZaZo^l^o^kZeZem^kgZmbo^l_hkk^Z\abg`ma^
Ngbm^]LmZm^lfZkd^m':g]k^\^gmbgo^lmf^gml[r<abg^l^\hfiZgb^l
bgma^hbelZg]lln``^lmmaZmZ`khpbg`Zem^kgZmbo^fZkd^meb^lZ\khll
ma^IZ\b_b\'Ma^<ZgZ]bZghbelZg]lpbee\hgmbgn^mh[^]^o^ehi^]
bkk^li^\mbo^h_pa^ma^kma^ibi^ebg^`h^lZa^Z]%lZb]Knll^ee@bkebg`%


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32-36 Canada Pipeline.indd 32 7/20/11 4:40:44 PM
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characLorisod bv hvporboIo on boLh sidos.
This siLuaLion has roachod such LaIismanic
significanco LhaL whaLovor Lho US govornmonL
doos wiII bo road far moro doopIv Lhan Lho
subsLanco moriLs,` said MichaoI Lovi, Lho
sonior foIIow for onorgv and Lho onvironmonL
aL Lho CounciI on Ioroign RoIaLions.
Tho SLaLo DoparLmonL, which musL
approvo Lho projocL bocauso iL crossos
inLornaLionaI bordors, is noaring Lho ond
of iLs onvironmonLaI roviow and Lhon wiII
oxamino naLionaI inLorosL quosLions. IL has
said iL oxpocLs Lo mako a ruIing bv Lho ond
of Lho voar.
Lho prosidonL and chiof oxocuLivo of
TransCanada, Lho companv bohind Lho
$, biIIion projocL.
ThaL doLorminaLion Lo procood has
bocomo aImosL bosido Lho poinL in Lho
baLLIo ovor KovsLono XL`s faLo, which has
draggod on sinco Novombor 2uu8.
EnvironmonLaIisLs aro using Lho projocL
as a proxv for Lhoir gonoraI anLagonism
Loward oiI sands producLion, which
consumos Iargo amounLs of waLor and
onorgv and can bo dosLrucLivo Lo Lho
boroaI forosL LhaL siLs on Lop of Lho Larrv
rock from which Lho oiI is oxLracLod.
This is roaIIv a campaign againsL Lar
sands oxpansion raLhor Lhan a singIo
pipoIino,` said Susan Casov-LofkowiLz, Lho
dirocLor of Lho inLornaLionaI programmo
aL Lho NaLuraI Rosourcos Dofonso CounciI,
an onvironmonLaI group LhaL is a Ioading
Amorican criLic of Lho procoss. AdvocaLos,
moanwhiIo, sav LhaL oiI sands oxLracLion
is goLLing cIoanor and roprosonLs a
poLonLiaIIv major sourco of oiI from a
poIiLicaIIv sLabIo aIIv LhaL wiII hoIp onsuro
US onorgv socuriLv.
MA>LM:D>L aro onormous. Tho oiI
sands havo rosorvos of 1,1.3 biIIion barroIs,
according Lo osLimaLos bv Lho provinciaI
govornmonL of AIborLa - onough Lo chango
Lho baIanco of worId oiI markoLs, somo
onorgv oxporLs sav. Bv comparison, Saudi
Arabia has rosorvos of 264.2 biIIion barroIs.
Bocauso of LhaL, Lho dobaLo ovor Lho
pipoIino has boon unusuaIIv proLracLod and
fracLious, and, according Lo somo anaIvsLs,
The oil sands have reserves of 171.3 billion barrels,
according to estimates by the provincial government
of Alberta enough to change the balance of world
oil markets, some energy experts say. By comparison,
Saudi Arabia has reserves of 264.2 billion barrels.
August 2011
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Even if the Keystone XL
pipeline is not approved,
Canada has existing
pipelines that could be
used to transport oil sands
production.
As Lho worId`s IargosL imporLor of oiI
and a noxL-door noighbour of Canada,
Lho UniLod SLaLos is Lho mosL aLLracLivo
and IogicaI markoL for oiI sands crudo
and aIroadv buvs virLuaIIv aII LhaL Canada
oxporLs. BuL producors aro oagor Lo movo
Lhoir producL aII Lho wav Lo Lho GuIf of
Moxico, whoro Lhoro aro moro rofinorios
capabIo of handIing Lho unusuaIIv Lhick
crudo. IL is now shippod Lhrough an
oxisLing pipoIino - an oarIior parL of Lho
KovsLono projocL - Lo Cushing, OkIahoma,
whoro Iargo sLorago faciIiLios aro fod
bv a varioLv of pipoIinos. Thoro, iL is
pricod againsL IighLor oiI and gonoraIIv
commands a Iowor prico.
Bocauso domand for oiI in Lho UniLod
SLaLos is unIikoIv Lo faII significanLIv in Lho
forosooabIo fuLuro, producors in Canada
aro suro Lo Iook for oLhor wavs Lo ship
Lhoir oiI souLh if Lho KovsLono XL projocL
is rojocLod. WhiIo backup pIans aro noL
fuIIv dovoIopod, oLhor opLions do oxisL.
LABIIBG@;R raiI is ono. LasL OcLobor,
in a joinL vonLuro wiLh Lho Canadian
NaLionaI RaiIwav of MonLroaI, AILox
Enorgv, an oiI shipping companv, bogan
shipping roIaLivoIv smaII amounLs of Lar
sands crudo aIong Canadian NaLionaI`s
Lracks dirocLIv Lo Lho GuIf of Moxico. NoL
onIv doos raiI avoid biIIions of doIIars in
infrasLrucLuro invosLmonL, iL aIso oscapos
anv roguIaLorv roviows in Lho UniLod
SLaLos. IL`s no difforonL Lhan shipping
Demand for oil in the
United States is unlikely
to fall significantly in
the foreseeable future,
producers in Canada are
sure to look for other
ways to ship their oil
south if the Keystone XL
project is rejected.
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Onco Lhoro, shipmonLs couId onLor Lho
UniLod SLaLos Lhrough oxisLing Lrans-
bordor crossings in OnLario and Ouoboc.
RonaId LioporL, Lho onorgv minisLor in
AIborLa, said LhaL whiIo Canada wouId
profor Lo soII iLs oiI Lo Lho UniLod SLaLos,
Lhis commodiLv wiII go somopIaco.`
In parLicuIar, ho said, China is aIroadv a
major consumor of oLhor naLuraI rosourcos
from Canada and is a smaII invosLor in Lho
oiI sands. I can prodicL confidonLIv LhaL aL
somo poinL China wiII Lako ovorv drop of
oiI Canada can produco.`
grain,` said GIon Porrv, Lho prosidonL
of AILox, which is basod in CaIgarv,
AIborLa. Porrv acknowIodgod LhaL raiI
was considorabIv moro oxponsivo Lhan
pipoIino shipping. PipoIinos, howovor,
roquiro Lho oiI sands crudo Lo bo diIuLod
wiLh chomicaIs LhaL Lhin iL and mako iL
fIow moro oasiIv. RaiI cars do noL.
BG:==BMBHGLo raiI, Lhoro aro oLhor
pipoIinos avaiIabIo. Tho Trans MounLain
pipoIino ownod bv Kindor Morgan
aIroadv movos AIborLa oiI, incIuding Lar
sands producLion, Lo porLs on Canada`s
Pacific CoasL. Somo of LhaL LravoIs bv soa
Lo rofinorios in Lho UniLod SLaLos. WhiIo
LhaL pipoIino is oporaLing aL noar capaciLv,
Kindor Morgan is considoring incroasing
iLs capaciLv Lo Lho coasL and has aIroadv
improvod Lho Iino inIand.
Enbridgo, anoLhor Iargo pipoIino
companv in Canada, is proposing iLs
own Iino, from jusL norLh of EdmonLon,
AIborLa, Lo Lho norLhorn BriLish CoIumbia
porL of KiLimaL.
WhiIo boLh of Lhoso projocLs
havo oncounLorod opposiLion from
onvironmonLaIisLs and somo aboriginaI
groups, Lho poIiLicaI cIimaLo favours
Lho onorgv indusLrv. In Mav Canadians
ro-oIocLod a ConsorvaLivo govornmonL LhaL
has iLs LradiLionaI powor baso in AIborLa,
which has sLaunchIv promoLod Lho oiI sands.
OLhor pipoIino projocLs couId dovoIop
if KovsLono XL doos noL. IL is LochnicaIIv
foasibIo Lo convorL ono of Lwo naLuraI gas
pipoIinos Lo oasLorn Canada Lo carrv oiI.
The approval of the Keystone XL pipeline has become a battleground for
environmentalists who say oil sands production wastes energy and water.
The oil extracted from Albertas oil sands is basically thick bitumen, which has to be
diluted with chemicals for pipeline transportation.
32-36 Canada Pipeline.indd 36 7/20/11 4:40:51 PM
L O O K I N G F O R W A R D T O M E E T I N G Y O U
The perfect union between Massimiliano and Doriana Fuksass architectural excellence and
southern Sardinias unspoiled nature: this is Is Molas Resort. An oasis of comfort and well-being
in complete respect for the territorys antique beauty and stunning environment complemented
by the luxury of a ve-star resort. Here you will nd a nurturing health SPA and one of the biggest
golf courses in the Mediterranean, designed by the legendary champion golfer Gary Player.
IS MOLAS_beauty ING_PORT EMIRATES.indd 1 22/06/11 15.37
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CUSTOMER SERVICE
Digitally-driven service enhancements are opening up totally new avenues of customer
service that were previously only available to large businesses, reports John Grossman.
BGERGGFBEHLIK>OBHNL
businoss ondoavours as a caLoror and
privaLo chof, cusLomor sorvico was oId
schooI and faco Lo faco - Lho IongsLanding
markoLpIaco advanLago onjovod bv smaII
businossos ovor big businossos.
Thon MiIos foundod CuIinarv TwisL in
oarIv 2u1u wiLh hor husband, Eric MarLoI,
Lo mako and soII Lhroo oxoLic saucos caIIod
Bora Bora, Baja and Mava Bav. SoIIing
Lhrough a disLribuLor and US WosL CoasL
food sLoros and spociaILv sLoros, MiIos
found Lho suddon disconnocLion wiLh
hor cusLomors disconcorLing. In-sLoro
producL LasLings hoIpod, buL sho know

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sho couId noL afford Lhom or Lho porsonaI
Limo commiLmonL on a conLinuing basis,
which is whv sho was oxciLod Lo Ioarn of
Lho high-Loch offorings of a foodback-
managomonL companv, Opinion Lab.
Mv hoarL was pounding Lhrough mv
shirL,` MiIos said, rocaIIing Lho briofing
sho rocoivod. Opinion Lab`s sofLwaro
is now in Lho oarIv sLagos of onabIing
CuIinarv TwisL, which is basod in IosLor
CiLv, CaIifornia, Lo inLoracL romoLoIv
wiLh smarLphono-LoLing shoppors -
ovon whiIo Lhov aro sLiII in Lho sLoro.
NoLhing is oId schooI abouL Lhis or
a wavo of oLhor high-Loch cusLomor
sorvico iniLiaLivos boing adopLod bv
a vanguard of smaII businossos.
In somo insLancos, such as aL
Zingorman`s, a doIicaLosson, rosLauranL,
maiI-ordor food soIIor and businoss
sominar hosL basod in Ann Arbor,
Michigan, Lho digiLaIIv drivon sorvico
onhancomonLs romain inLornaI and
invisibIo Lo cusLomors.
Ior Lho pasL dozon voars, Zingorman`s
has capLurod cusLomor commonLs as
oiLhor codo rod (compIainLs) or codo groon
(compIimonLs), buL unLiI roconLIv Lhov
woro capLurod on papor forms. SLoring
commonLs digiLaIIv makos iL much oasior
38-41 QR Code.indd 38 7/20/11 4:45:02 PM
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Lynn Milos of Culinary Twist scans a Quick Response code on bottles of her grilling sauce at a store in California. Innovative small
businesses are adopting sophisticated technology, like smartphone-readable codes and online chat, to improve customer service.
or ovon noLificaLion of a probIom aL a
parLicuIar sLoro - bo iL a missing favouriLo
or fiILhv dispIav shoIvos.
Sho oxpocLs moro of Lho kind of hoIpfuI
foodback rocoivod in an oarIv sLoro domo
LhaL Iod Lo a roIaboIing of Lho Bora Bora
sauco. Wo had so manv poopIo sav Lhov
didn`L know whaL Lamarind was, or daLos,
LhaL wo docidod Lo Lako Lhoso words ouL
of Lho subscripL and chango iL Lo moro
abouL Lho fIavour and how Lho producL
was usod,` MiIos said. IL now savs 'SwooL
Spico GriIIing Sauco.` ThaL`s anoLhor pioco
Lo Lho OR codo and sorving Lho cusLomor
- jusL IisLoning Lo Lhom.`
Tho OR codo onhancomonLs Lo Lho
IaboIs cosL abouL 1 conLs a boLLIo. Rand
Nickorson, Opinion Lab`s chiof oxocuLivo,
puLs addiLionaI cosLs for his companv`s
sorvicos aL ponnios por consumor
commonL. IL`s noL Lruo anvmoro LhaL
Lo anaIvso Lhom, said Maggio BavIoss,
managing parLnor of ZingTrain, Lho
businoss sominar division.
Wo can now sorL bv Lvpos of
compIainLs, cusLomor namo or poriod of
Limo,` BavIoss said. Ior oxampIo, as wo
go inLo Lho hoIidavs, iL`s possibIo Lo puII
Lho daLa for Lho hoIidav soason a voar ago
and soo whaL probIoms wo woro having
and idonLifv: WhaL do wo nood Lo romind
poopIo Lo waLch for Lhis voar?`
Bv conLrasL, Lho highIv visibIo brand
of high-Loch cusLomor sorvico offorod bv
CuIinarv TwisL is acLivaLod bv so-caIIod
OR codos on iLs producL IaboIs. ShorL for
Ouick Rosponso, Lhoso bar codo cousins,
whon phoLographod bv an app-onabIod
smarLphono, offor a woaILh of sorvico
opporLuniLios. PoLonLiaI buvors can viow
a rocipo, sav, for ribs in Baja sauco whon
Lhov aro sLops from Lho moaL counLor.
LHHG%FBEHL said, Lhov wiII bo abIo
Lo caII up on Lhoir hand-hoId dovicos a
discounL coupon LhaL can bo scannod aL
chockouL. And wiLh hoIp from Opinion
Lab`s back-shop capabiIiLios, MiIos can
aIso rocoivo rocipo suggosLions, insighLs
You dont have to run
a wave of $100,000
focus groups across the
country to learn things
anymore. The most
successful companies in
the future, I believe, will
be those who become
progressively more and
more customer-driven.
38-41 QR Code.indd 39 7/20/11 4:45:05 PM
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in Indiana and souLhorn Michigan. ThaL`s
aIso Lho Numbor 2 and Numbor 3 roason.`
Tho onIino chock-in opLion now boing
inLroducod aL Lho GroaL CIips wobsiLo,
which aIIows cusLomors Lo onLor Lhoir ZIP
codos Lhrough a compuLor or smarLphono,
chocks Lho curronL waiL Limos aL noarbv
GroaL CIips ouLIoLs and IoLs cusLomors
chooso Lho opLimum IocaLion. IL`s pIaving
in Pooria,` said David Hands, who wiLh
his wifo, Tanja, owns sovon GroaL CIips
IocaLions in Pooria and Lho BIoomingLon]
NormaI aroa of IIIinois, whoro waIk-in
cusLomors havo LvpicaIIv waiLod oighL Lo 1
onIv Lho ProcLor & GambIos of Lho worId
can afford Lo do Lhis,` ho said. You don`L
havo Lo run a wavo of $1uu,uuu focus
groups across Lho counLrv Lo Ioarn Lhings
anvmoro. Tho mosL succossfuI companios
in Lho fuLuro, I boIiovo, wiII bo Lhoso who
bocomo progrossivoIv moro and moro
cusLomor-drivon.`
MA:MBL Lho inLonLion aL GroaL CIips,
Lho naLionwido chain of hair saIons. Tho
Numbor 1 roason wo Ioso cusLomors is
bocauso wo mako Lhom waiL,` said Tim
LawIoss, who owns GroaL CIips franchisos
minuLos for a cuL.
A roconL cvbor chock-in, a voung guv
on Lho go,` waIkod Lhrough Lho door, saL
down and LoId Hands, Thanks for giving
mo 1u minuLos back Lo mv Iifo.`
OnIv Lwo monLhs afLor inLroducLion,
Hands said, ho is avoraging 1u romoLo
chock-ins por ouLIoL por wook - abouL 1u
por conL of his businoss.
PABM>?E:LA%: HousLon-basod onIino
roLaiIor of ongagomonL rings, aIroadv
roIios on chaL Lo sorvo Lho noods of iLs
cusLomors, mosLIv maIo and comforLabIo
wiLh LochnoIogv, who aro noL shv abouL
sponding from $1,uu Lo manv Limos LhaL
amounL wiLhouL a faco-Lo-faco oncounLor.
In facL, said Dobi WoxIor, WhiLofIash
foundor and chiof oxocuLivo, manv of hor
cusLomors profor Lho companv`s roaI-Limo
oIocLronic convorsaLions.
Manv of our cusLomors aro from
MaIavsia, Hong Kong and Singaporo,`
WoxIor said, and a IoL of Lhom don`L fooI
Whiteflash customers can zoom in on various
diamond and ring choices before typing their
questions into chat boxes powered by Bold Chat,
the companys software provider, which stores the
three to five chats typically needed to close a sale.
Great Clips, a US-wide chain of hair salons, uses an online check-in option to allow customers to check the
current wait times at nearby Great Clip outlets.
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soIf-sorvico aL anv hour of Lho dav.
This sorvico is hoIpfuI Lo RiLon`s smaII
machino-shop cusLomors, ospociaIIv Lhoso
LhaL havo noL invosLod in compuLor-aidod
dosign, or CAD, sofLwaro.
Somo don`L havo moro Lhan a haIf-
dozon ompIovoos and Lhov don`L do CAD,`
said MiLchoII Kirbv, vico prosidonL of
manufacLuring, so Lhov`ro happv wiLh
whaL wo provido bocauso Lhov can go on
our wobsiLo and draw Lho LooI LhaL Lhov
nood, show iL Lo Lhoir machino oporaLors,
and Lhon sond iL Lo mo Lo havo iL quoLod.`
Bv offocLivoIv oxpanding Lho
CAD acronvm Lo aIso moan cusLomor-
aidod dosign, Lho companv, basod in
WashingLon CourL Houso, Ohio, has
incroasod Lho cusLom-mado parL of iLs
businoss, which aIso incIudos ropairs, Lo
abouL haIf of iLs annuaI rovonuo. IL`s safo
Lo sav,` LachaL said, LhaL wo`vo aImosL
doubIod in sizo sinco wo wonL in Lhis
dirocLion on Lho inLornoL.`
comforLabIo spoaking on Lho phono buL
fooI vorv comforLabIo omaiIing us and
chaLLing wiLh us in onIino chaL.`
Tho siLo aLLracLs sorvicomon sLaLionod
ovorsoas buL ovon sLaLosido civiIian
grooms-Lo-bo approciaLo Lho chaL-
onabIod buving sossions, sho said. A IoL
of cusLomors, boIiovo iL or noL, wiII chaL
wiLh us during Lhoir work hours,` sho said,
bocauso Lhov don`L nocossariIv wanL Lo bo
LaIking on Lho LoIophono ordoring Lhoir
ongagomonL ring whiIo aL Lho offico. AL
homo, ovon whon Lho girIfriond is Lhoro,
Lhov can proLond LhaL Lhov`ro working
on Lho compuLor whon acLuaIIv Lhov`ro
LaIking Lo a consuILanL.`
WhiLofIash cusLomors can zoom in on
various diamond and ring choicos boforo
Lvping Lhoir quosLions inLo chaL boxos
poworod bv BoId ChaL, Lho companv`s
sofLwaro providor, which sLoros Lho Lhroo Lo
fivo chaLs LvpicaIIv noodod Lo cIoso a saIo.
This aIIows anoLhor sorvico roprosonLaLivo
Lo pick up a convorsaLion LhaL has boon
cuL off abrupLIv bv Lho suddon ovor-Lho-
shouIdor appoaranco of Lho fianco-Lo-bo.
MA>P>;LBM> capabiIiLios of RiLon
IndusLrios, a ,8-voar-oId makor of LooIs
LhaL hoId indusLriaI parLs whiIo Lhov aro
boing producod, aIIow Lho companv Lo
do moro Lhan jusL dispIav iLs producLs.
ILs siLo, onhancod wiLh compuLor-aidod
dosign, aIIows cusLomors Lo modifv a
parL Lo mooL spocific noods, said Androw
LachaL, who owns Lho companv. Tho
sofLwaro, bv Thomas IndusLriaI NoLwork
of Now York, offocLivoIv providos romoLo
Some are happy with what we
provide because they can go on
our website and draw the tool
that they need, show it to their
machine operators, and then send
it to me to have it quoted.
Whiteflash, a retailer of engagement rings, serves mostly male
customers who are comfortable with technology and have no
hesitation about buying online.
Whiteflashs site is powered by Bold Chat, which allows
customers to ask questions online.
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soIf-sorvico aL anv hour of Lho dav.
This sorvico is hoIpfuI Lo RiLon`s smaII
machino-shop cusLomors, ospociaIIv Lhoso
LhaL havo noL invosLod in compuLor-aidod
dosign, or CAD, sofLwaro.
Somo don`L havo moro Lhan a haIf-
dozon ompIovoos and Lhov don`L do CAD,`
said MiLchoII Kirbv, vico prosidonL of
manufacLuring, so Lhov`ro happv wiLh
whaL wo provido bocauso Lhov can go on
our wobsiLo and draw Lho LooI LhaL Lhov
nood, show iL Lo Lhoir machino oporaLors,
and Lhon sond iL Lo mo Lo havo iL quoLod.`
Bv offocLivoIv oxpanding Lho
CAD acronvm Lo aIso moan cusLomor-
aidod dosign, Lho companv, basod in
WashingLon CourL Houso, Ohio, has
incroasod Lho cusLom-mado parL of iLs
businoss, which aIso incIudos ropairs, Lo
abouL haIf of iLs annuaI rovonuo. IL`s safo
Lo sav,` LachaL said, LhaL wo`vo aImosL
doubIod in sizo sinco wo wonL in Lhis
dirocLion on Lho inLornoL.`
comforLabIo spoaking on Lho phono buL
fooI vorv comforLabIo omaiIing us and
chaLLing wiLh us in onIino chaL.`
Tho siLo aLLracLs sorvicomon sLaLionod
ovorsoas buL ovon sLaLosido civiIian
grooms-Lo-bo approciaLo Lho chaL-
onabIod buving sossions, sho said. A IoL
of cusLomors, boIiovo iL or noL, wiII chaL
wiLh us during Lhoir work hours,` sho said,
bocauso Lhov don`L nocossariIv wanL Lo bo
LaIking on Lho LoIophono ordoring Lhoir
ongagomonL ring whiIo aL Lho offico. AL
homo, ovon whon Lho girIfriond is Lhoro,
Lhov can proLond LhaL Lhov`ro working
on Lho compuLor whon acLuaIIv Lhov`ro
LaIking Lo a consuILanL.`
WhiLofIash cusLomors can zoom in on
various diamond and ring choicos boforo
Lvping Lhoir quosLions inLo chaL boxos
poworod bv BoId ChaL, Lho companv`s
sofLwaro providor, which sLoros Lho Lhroo Lo
fivo chaLs LvpicaIIv noodod Lo cIoso a saIo.
This aIIows anoLhor sorvico roprosonLaLivo
Lo pick up a convorsaLion LhaL has boon
cuL off abrupLIv bv Lho suddon ovor-Lho-
shouIdor appoaranco of Lho fianco-Lo-bo.
MA>P>;LBM> capabiIiLios of RiLon
IndusLrios, a ,8-voar-oId makor of LooIs
LhaL hoId indusLriaI parLs whiIo Lhov aro
boing producod, aIIow Lho companv Lo
do moro Lhan jusL dispIav iLs producLs.
ILs siLo, onhancod wiLh compuLor-aidod
dosign, aIIows cusLomors Lo modifv a
parL Lo mooL spocific noods, said Androw
LachaL, who owns Lho companv. Tho
sofLwaro, bv Thomas IndusLriaI NoLwork
of Now York, offocLivoIv providos romoLo
Some are happy with what we
provide because they can go on
our website and draw the tool
that they need, show it to their
machine operators, and then send
it to me to have it quoted.
Whiteflash, a retailer of engagement rings, serves mostly male
customers who are comfortable with technology and have no
hesitation about buying online.
Whiteflashs site is powered by Bold Chat, which allows
customers to ask questions online.
38-41 QR Code.indd 41 7/20/11 4:45:07 PM
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PA>GI:NEC:<H;LMHHDHO>K
from his faLhor as chiof oxocuLivo of
Lho chip makor OuaIcomm in 2uu,
mobiIo phonos woro jusL boginning Lhoir
LransiLion from LooIs for LaIking Lo hand-
hoId compuLors doIivoring daLa and
onLorLainmonL. Wo LaIk abouL Lho fuLuro
of compuLing boing mobiIo, buL I don`L
fooI LhaL wav,` said Jacobs, 48. I fooI Lho
prosonL of compuLing is mobiIo.`
Jacobs has sponL Lho IasL six voars
oxpanding OuaIcomm`s businoss bovond
his faLhor`s LighL focus on Lho digiLaI
wiroIoss LochnoIogv known as CDMA
(codo division muILipIo accoss). WhiIo
Irwin Jacobs, ,,, Lho MIT profossor and
oIocLronics wizard who foundod Lho
companv in 108 and roLirod in 2uu,
was known for his doggod dofonco of Lho
companv`s inLoIIocLuaI proporLv, his son
PauI is moro prono Lo LaIk broaLhIossIv
abouL a connocLod worId whoro mobiIo
dovicos diagnoso our iIInossos, Lurn on our
IighLs, conLroI our LhormosLaLs and aIIow
docLors Lo romoLoIv moniLor our hoaILh
in roaI Limo.
Such a famiIv succossion in pubIicIv
Lradod companios is raro; Iord MoLor and
CwomcasL como Lo mind. Ior iL Lo succood
is raror sLiII. CorporaLo govornanco oxporLs
ofLon disapprovo of such succossions.
BuL Lho voungor Jacobs has posiLionod
OuaIcomm, which buiIds chips for mobiIo
dovicos, Lo Ioad Lho smarLphono chip
markoL as consumors incroasingIv do
Lhoir compuLing in Lhoir paIms and noL
LoLhorod Lo Lhoir dosks.
LasL voar OuaIcomm dominaLod a
divorso fioId of smarLphono chip makors
wiLh 41 por conL of Lho LoLaI markoL sharo
in Lorms of rovonuo and noarIv 61 por
conL of Lho markoL sharo for appIicaLion
procossors usod in smarLphonos poworod
bv GoogIo`s Android oporaLing svsLom,
according Lo Lho markoL rosoarch firm
SLraLogv AnaIvLics. ParL of Lho companv`s
Paul Jacobs has taken Qualcomm to the top of
the mobile chip market. But his ambition stretches
way beyond the confines of mobile phones,
reports Malia Wollan.
QUALCOMMS
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Paul Jacobs took over from
his father in 2005 and has
successfully led Qualcomm
to dominated the smartphone
chip market.
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succoss is LhaL Lho markoL for smarLphonos
has boon so robusL. In 2u1u, smarLphono
shipmonLs shoL up ,4 por conL ovor Lho
voar boforo, whiIo Lho markoL for PCs
incroasod jusL 14 por conL, according Lo
Lho markoL rosoarch firm IDC.
LN<AAN@> growLh in hand-hoId
compuLors has rivaI chip makors Iiko InLoI,
Nvidia, Samsung and Toxas InsLrumonLs
in a LighL raco Lo buiId smaIIor, moro
powor-officionL chips, capabIo of running
Lho incroasingIv compIox apps, IocaLion-
basod sorvicos and graphics consumors
havo como Lo oxpocL in Lhoir phonos. InLoI,
which dominaLod PC chips, is IaLo Lo Lhis
markoL, so iL`s anvono`s gamo Lo win.
OuaIcomm`s sLraLogv has boon Lo
croaLo high-funcLion, Iow-poworod chip
soLs for smarLphonos and LabIoLs LhaL
connocL wiLh oLhor dovicos in various
wavs - a foaL LhaL has Lhus far IargoIv
oIudod InLoI. OuaIcomm`s ARM-basod
Snapdragon chips aro jusL such aII-
in-ono procossors. OuaIcomm has a
Lwo- or Lhroo-voar advanLago in Lorms
of inLograLion,` said SLuarL Robinson, an
anaIvsL aL SLraLogv AnaIvLics.
And, OuaIcomm has managod a
Ioadorship foaL unusuaI in Lho modorn
businoss onvironmonL.
OuaIcomm has boon abIo Lo do Lho
handoff from faLhor Lo son LhaL mosL oLhor
companios havo noL boon abIo Lo do,` said
Codv Acroo, an anaIvsL aL Lho WiIIiams
IinanciaI Group who has covorod
OuaIcomm and Lho chip indusLrv for moro
Lhan a docado. PauI is an onginoor who
owns paLonLs in his own righL and was
a briIIianL LochnoIogisL boforo moving
inLo Lhis posiLion,` ho said. And I Lhink
Lho indusLrv as a whoIo rospocLod him,
knowing ho was noL jusL boing givon Lho
job bocauso iL was his dad`s.`
SLiII, Lho sLigma of nopoLism LraiIod
Jacobs. I couId waIk inLo a room and
poopIo wouId jusL undorosLimaLo mo.
'You`ro Lho son of Irwin,`` ho said. Thov
wouId Lhink, 'This porson is onIv horo
bocauso of LhaL.``
Tho Lhird of four sons, Jacobs Look Lo
compuLors oarIv, Ioarning Lo program in
middIo schooI on a ToIoLvpo LorminaI.
Boginning in sovonLh grado ho workod
parL Limo aL LinkabiL, anoLhor LochnoIogv
companv foundod bv his faLhor, which
mado communicaLions oquipmonL for
Lho miIiLarv. During coIIogo ho workod
summors aL OuaIcomm.
AnoLhor Lhing LhaL mv faLhor did for mo
was LhaL ovorv summor I workod in anoLhor
Qualcomms
strategy has been
to create high-
function, low-
powered chip sets
for smartphones and
tablets that connect
with other devices
in various ways a
feat that has thus far
largely eluded Intel.
Qualcomm chips dominate the Android smartphone
market with 61 per cent market share.
Qualcomm designs and supplies CDMA chipsets, system software, network base
stations, handsets, camera phones and game players to name just a few things.
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succoss is LhaL Lho markoL for smarLphonos
has boon so robusL. In 2u1u, smarLphono
shipmonLs shoL up ,4 por conL ovor Lho
voar boforo, whiIo Lho markoL for PCs
incroasod jusL 14 por conL, according Lo
Lho markoL rosoarch firm IDC.
LN<AAN@> growLh in hand-hoId
compuLors has rivaI chip makors Iiko InLoI,
Nvidia, Samsung and Toxas InsLrumonLs
in a LighL raco Lo buiId smaIIor, moro
powor-officionL chips, capabIo of running
Lho incroasingIv compIox apps, IocaLion-
basod sorvicos and graphics consumors
havo como Lo oxpocL in Lhoir phonos. InLoI,
which dominaLod PC chips, is IaLo Lo Lhis
markoL, so iL`s anvono`s gamo Lo win.
OuaIcomm`s sLraLogv has boon Lo
croaLo high-funcLion, Iow-poworod chip
soLs for smarLphonos and LabIoLs LhaL
connocL wiLh oLhor dovicos in various
wavs - a foaL LhaL has Lhus far IargoIv
oIudod InLoI. OuaIcomm`s ARM-basod
Snapdragon chips aro jusL such aII-
in-ono procossors. OuaIcomm has a
Lwo- or Lhroo-voar advanLago in Lorms
of inLograLion,` said SLuarL Robinson, an
anaIvsL aL SLraLogv AnaIvLics.
And, OuaIcomm has managod a
Ioadorship foaL unusuaI in Lho modorn
businoss onvironmonL.
OuaIcomm has boon abIo Lo do Lho
handoff from faLhor Lo son LhaL mosL oLhor
companios havo noL boon abIo Lo do,` said
Codv Acroo, an anaIvsL aL Lho WiIIiams
IinanciaI Group who has covorod
OuaIcomm and Lho chip indusLrv for moro
Lhan a docado. PauI is an onginoor who
owns paLonLs in his own righL and was
a briIIianL LochnoIogisL boforo moving
inLo Lhis posiLion,` ho said. And I Lhink
Lho indusLrv as a whoIo rospocLod him,
knowing ho was noL jusL boing givon Lho
job bocauso iL was his dad`s.`
SLiII, Lho sLigma of nopoLism LraiIod
Jacobs. I couId waIk inLo a room and
poopIo wouId jusL undorosLimaLo mo.
'You`ro Lho son of Irwin,`` ho said. Thov
wouId Lhink, 'This porson is onIv horo
bocauso of LhaL.``
Tho Lhird of four sons, Jacobs Look Lo
compuLors oarIv, Ioarning Lo program in
middIo schooI on a ToIoLvpo LorminaI.
Boginning in sovonLh grado ho workod
parL Limo aL LinkabiL, anoLhor LochnoIogv
companv foundod bv his faLhor, which
mado communicaLions oquipmonL for
Lho miIiLarv. During coIIogo ho workod
summors aL OuaIcomm.
AnoLhor Lhing LhaL mv faLhor did for mo
was LhaL ovorv summor I workod in anoLhor
Qualcomms
strategy has been
to create high-
function, low-
powered chip sets
for smartphones and
tablets that connect
with other devices
in various ways a
feat that has thus far
largely eluded Intel.
Qualcomm chips dominate the Android smartphone
market with 61 per cent market share.
Qualcomm designs and supplies CDMA chipsets, system software, network base
stations, handsets, camera phones and game players to name just a few things.
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aroa of onginooring, so LhaL bv Lho Limo I
wonL Lo coIIogo, I had dono aImosL ovorv
kind of onginooring Lhoro was,` said Jacobs,
who wonL on Lo oarn a Ph.D. in oIocLricaI
onginooring aL Lho UnivorsiLv of CaIifornia,
BorkoIov, whoro ho focusod on roboLics.
Evon whon ho is in a sLvIish suiL, his
Iaid-back cadonco - Lhough popporod wiLh
compuLor scionco acronvms - ovokos his
skaLoboarding Loonago voars horo in San
Diogo. Jacobs is LaII and aLhIoLic, and his
domoanour as chiof sooms shapod in oquaI
parLs bv his hvpor-LochnicaI upbringing and
Lhis sunnv, boachsido ciLv whoro ho grow up.
Whoro Jacobs sooms Lo rovoI in Lho
possibiIiLios of a noL-so-disLanL fuLuro
awash in wiroIoss connocLiviLv, his faLhor
had a moro profossoriaI, and aL Limos
mvopic, porspocLivo. PauI is vorv much
broador in Lho aroa LhaL ho has vision,`
said SLovon MoIIonkopf, Lho oxocuLivo
vico prosidonL ovorsooing OuaIcomm`s
chip dovoIopmonL, who has boon wiLh
Lho companv sinco 1004. Ho Iikos Lho
appIicaLion of Lho LochnoIogv in addiLion
Lo Lho LochnoIogv. Irwin LradiLionaIIv was
vorv ongagod in Lho LochnoIogv and Lho
croaLion of Lho LochnoIogv.`
Jacobs onjovs LaIking abouL a worId
whoro chips sproad ouL bovond Lho
confinos of smarLphonos. In Lhis so-caIIod
inLornoL of Lhings, ovorvdav objocLs
Iiko TVs, dishwashors, running shoos,
bIood gIucoso moniLors, picLuro framos,
hoarL dofibriIIaLors and ovon Band-Aids
havo Linv chips or sonsors LhaL LransmiL
informaLion and communicaLo wiLh
mobiIo dovicos Iiko smarLphonos and
LabIoLs. Tho sonsors aro going Lo bo
on vour bodv, Lhov`ro going Lo bo in Lho
onvironmonL around vou,` Jacobs said.
You` II go and sLop on Lho scaIo and Lho
scaIo wiII auLomaLicaIIv LaIk Lo vour phono
and koop Lrack of vour hoaILh.`
?HKJN:E<HFF Lo buiId ouL an
inLornoL of Lhings iL musL dosign chip
soLs LhaL can soamIossIv inLoracL wiLh
counLIoss communicaLion signaIs
incIuding Wi-Ii, coIIuIar, BIuoLooLh,
GPS, poor-Lo-poor radios and noar-fioId
communicaLion. In Iobruarv, OuaIcomm
announcod a now LochnoIogv caIIod
IIashLinq, which aIIows dovicos Lo
rocogniso ono anoLhor and communicaLo
auLomaLicaIIv and conLinuousIv wiLhin
a ono-kiIomoLro radius. LasL voar, Lho
companv sponL $2. biIIion, somo 23
por conL of iLs rovonuo, on rosoarch and
dovoIopmonL on jusL such LochnoIogios.
OuaIcomm`s purchaso of Lho chip makor
ALhoros CommunicaLions for $3.1 biIIion,
Lho companv`s IargosL acquisiLion Lo daLo,
oxpands OuaIcomm bovond phonos inLo
LabIoLs and homo oIocLronic dovicos. IL
movos Lho companv cIosor Lo fuIfiIIing
Lhis vision LhaL wiroIoss is going Lo bo
omboddod in Lho worId around us,` Jacobs
said. Ho is parLicuIarIv koon on oxpanding
wiroIoss communicaLion inLo hoaILh caro.
In Januarv, OuaIcomm announcod a
parLnorship wiLh ToIcaro Lo inLograLo 3G
connocLiviLv inLo bIood gIucoso moLors,
aIIowing carogivors Lo moniLor paLionLs`
gIucoso IovoIs romoLoIv and in roaI Limo.
Somo of Jacobs` inLorconnocLod visions
can bo a biL wackior. In Mav, OuaIcomm
and Lho X Prizo IoundaLion, which
financos compoLiLions for Lhings Iiko spaco
fIighL and Iunar Iandings, announcod a
$1u miIIion compoLiLion for a diagnosLic
smarLphono LooI caIIod Tricordor X,
namod for a gadgoL in Lho SLar Trok TV
show and movios. Tho chaIIongo is Lo
buiId a non-invasivo buL accuraLo dovico
LhaL can doLocL hoaILh probIoms.
Now Lhis is a IiLLIo fuLurisLic, I` II admiL,`
ho said. BuL iL`s noL LhaL farfoLchod.`
Paul Jacobs wants to create an internet of things where everyday objects like TVs and
running shoes can communicate with each other. This means designing chips that can
interact with countless communication signals.
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WI TH PERSONALI TY
During the recession, retailers cut costs and that included window dressing
and mannequins. But that has changed as retailers target a narrower customer
base, reports Stephanie Clifford.
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MANNEQUI NS
WI TH PERSONALI TY
During the recession, retailers cut costs and that included window dressing
and mannequins. But that has changed as retailers target a narrower customer
base, reports Stephanie Clifford.
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HG>LBS>?BML:EEGH
Iongor appIios Lo mannoquins.
WiLh roLaiIors fighLing for
cusLomors in Lho sIuggish oconomic
rocovorv, Lho gonoric whiLo, hairIoss,
skinnv mannoquin is boing pushod asido
bv provocaLivo aILornaLivos LhaL onLico
shoppors wiLh muscIos, unusuaI posos,
famous facos and IifoIiko bodios.
Tho cusLomor shops from Lho
mannoquin,` said Jonnv Ming, chiof
oxocuLivo of vouLh roLaiIor CharIoLLo
Russo, whoro posos for now mannoquins
aro drawn from rod-carpoL coIobriLv
picLuros, and foaLuro piorcod oars,
arLicuIaLod fingors for rings and fIoxod
fooL for high hooIs. Tho Numbor 1 roason
our cusLomors como in is bocauso Lhov soo
somoLhing Lhov Iiko.`
Tho Disnov SLoros chain has addod
IiLLIo-bov figurinos LhaL fIv from Lho
coiIing and IiLLIo-girI onos LhaL curLsov.
Niko has mado iLs mannoquins LaIIor and
addod abouL 3 aLhIoLic posos. Armani
Exchango has ordorod modoIs LhaL wiII Iio
down Lo hoIp shoppors imagino woaring
Iingorio. A now accossorios-onIv sLoro bv
Guoss foaLuros gIossv bIack mannoquins
in modoI-Iiko posos on an acLuaI runwav,
whiIo RaIph Lauron`s now womon`s sLoro
in ManhaLLan commissionod mannoquins
wiLh Lho faco of modoI Yasmin Lo Bon.
IL is aII parL of a now approciaLion for
oId-fashionod window drossing. During
Lho 100us and oarIv 2uuus, manv sLoros
cuL cosLs bv hiring inoxporioncod workors
Lo ouLfiL Lhoir mannoquins, and gonoric
was bosL as Lho dummios noodod Lo bo
dummv-proof. BuL wiLh shoppors goLLing
incroasingIv soIocLivo, roLaiIors aro
oxpocLing Lhoir sLoro dispIavs Lo sorvo as
'como on in` advorLising, wiLh Lho mado-
Lo-ordor mannoquins sonding a vorv
spocific mossago.
Thov porsonifv Lhoir brand wiLh Lhoir
mannoquin sLaLomonLs, and Lhov`ro
Iooking for somoLhing a IiLLIo moro
cusLomisod or uniquo,` said PoLor HusLon,
brand prosidonL aL Iusion SpociaILios,
a mannoquin companv in CoIorado
whoso saIos, aImosL aII of Lhom cusLom
mannoquins, roso 48 por conL IasL voar.
Ono of Iusion`s cusLomors is ALhIoLa,
Lho sporLswoar companv ownod bv
Gap Inc. IL commissionod mannoquins
basod on a caLaIoguo modoI, DanioIIo
Mannequins are playing an increasingly important role in luring customers into shops.
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HaIvorson, a Lrack-and-fioId aLhIoLo
Lraining for Lho OIvmpics.
Iusion SpociaILios digiLaIIv scannod
HaIvorson in sLaLionarv and acLion
soquoncos. Thon, ovor abouL Lwo wooks,
sovon scuIpLors croaLod cIav rondorings of
Lho 3-D digiLaI scans LhaL hand-oLchod
hor from a Linv piIo of cIav down Lo Lho
Linv doIinoaLions of Lho sinow in Lho
muscIo,` said Toss Rooring, vico prosidonL
for markoLing aL ALhIoLa, which oponod iLs
firsL phvsicaI sLoros Lhis voar.
AfLor making moro proLoLvpos, Iusion
producod Lho Dani-quin, as ALhIoLa
oxocuLivos sLarLod caIIing Lho mannoquin,
in fivo variaLions. Tho running poso,
ospociaIIv, Iooks roaIisLic: sho is in
midsLrido, wiLh onIv hor IofL Loos on Lho
ground. Tho Dani-quin, bv Lho wav, is
hoadIoss. Wo wanLod Lo mako suro LhaL
our cusLomors woron`L worrving abouL Lho
hair, or anvLhing oIso,` Rooring said.
FB<A:>ELM>P:K=, oxocuLivo vico
prosidonL of RooLsLoin USA, which makos
mannoquins for sLoros Iiko RaIph Lauron,
ChanoI and Noiman Marcus, said Lho
nowfound approciaLion for spociaILv
mannoquins camo as manv roLaiIors
roassossod Lho markoL.
A IoL of poopIo havo docidod Lhov havo
Lo spociaIiso,` SLoward said. NoLhing
soIIs Lho cIoLhing Iiko a mannoquin: IL`s a
subIiminaI mossago from Lho roLaiIor, Lho
firsL Lhing poopIo soo in Lho window or in
a doparLmonL whon Lhov go inLo Lho sLoro.`
Whon mannoquins firsL woro usod, Lhov
woro basicaIIv mouIdod dross forms Lo
which cIoLhing makors pinnod garmonLs.
Bv Lho 102us, Lhov had dovoIopod inLo
Lorsos wiLh joinLs aLLachod and sIowIv
sLarLod Lo goL wigs, makoup and gIass
ovos. Bv Lho 106us, whon somo womon
sLoppod woaring bras, vou sLarLod Lo havo
nippIos on mannoquins,` said Linda ScoLL,
a profossor sLudving consumor cuILuro aL
Lho Said Businoss SchooI aL Oxford. ThaL
was a big shifL,` sho said.
BuL in Lho 10,us, as roLaiI chains
oxpandod naLionaIIv and cosL prossuros
incroasod, mannoquins shifLod back
Loward Lho gonoric. ThaL`s whon vou saw
mannoquins LhaL did noL roquiro makoup,
did noL roquiro wigs, or so much aLLonLion
Lo doLaiI, Lo roduco Lho cosLs,` said HusLon,
Lho Iusion oxocuLivo.
During Lho rocossion, companios
curLaiIod sponding whorovor Lhov couId, and
mannoquin saIos sIowod. BuL afLor shodding
unprofiLabIo brands or morchandiso during
Lho rocossion, Lho roLaiIors aro focusod on
a spocific cusLomor and a parLicuIar brand
posiLion, and Lhov wanL Lhoir windows Lo
rofIocL LhaL wiLh cusLom mannoquins.
Fusion Specialties
digitally scanned
Halverson in stationary
and action sequences.
Then, over about two
weeks, seven sculptors
created clay renderings
of the 3-D digital scans
that hand-etched
her from a tiny pile of
clay down to the tiny
delineations of the
sinew in the muscle.
Sculptor Bill Hueg
works on the tiny
details of hands at
Fusion Specialties, a
mannequin company.
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Ovor Lho pasL Lwo voars, ovorvono has
roaIIv had Lo roassoss Lhoir businoss and
Lhoir cIionL baso,` SLoward said, and Lho
markoL is so compoLiLivo LhaL poopIo aro
jusL focusing on whaL Lhov do woII, and
whaL Lhov soII.`
IKB<>LH? cusLom mannoquins run
from abouL $4uu Lo $1,2uu a
mannoquin, noL incIuding Lho $1,uuu
or moro LhaL pIacos Iiko Iusion chargo
for dovoIopmonL. A mannoquin makoovor
can cosL a naLionaI chain miIIions.
Is iL monov woII sponL? NoL aIwavs,
said ScoLL, bocauso shoppors aro an
unprodicLabIo IoL.
SomoLimos Lhov`ro imagining
LhomsoIvos in Lho cIoLhos, somoLimos
Lhov`ro jusL onLorLaining LhomsoIvos on an
ovoning waIk, somoLimos Lhov`ro sLanding
Lhoro wiLh a girIfriond LaIking abouL
how sLupid Lho cIoLhos Iook,` sho said.
And SLoward, Lho oxocuLivo aL
RooLsLoin, said roLaiIors somoLimos ask
Loo much of Lhoir mannoquins.
Evorvono Lhinks Lhov`ro going Lo
roinvonL Lho whooI,` ho said. As I aIwavs
sav, Lhoro`s onIv so manv Lhings
a mannoquin can do: WouId vou Iiko
Lwo hoads wiLh LhaL, madam?`
Greg Amanti, right, picks up a fiberglass mannequin form as
Robert Roybal fits the endpiece for an arm. Custom mannequin
companies have seen their business almost double.
Bets Lundeen prepares a custom mannequin
of a golfing woman. The development of a
mannequin costs $15,000 or more.
46-49 Mannequin.indd 49 7/20/11 6:28:53 PM
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>O>G:L<ABG:IK>I:K>=MHHI>G
Lho buIIoL Lrain sorvico from Boijing Lo
Shanghai on 3u Juno, Lhis naLion`s sLoadiIv
oxpanding high-spood raiI noLwork was
boing piIIoriod on a scaIo raro among
Chinoso ciLizons and nows modia.
CompIainLs incIudod Lho svsLom`s high
cosLs and pricov faros, Lho quaIiLv of
consLrucLion and Lho aIIogaLion of soIf-
doaIing bv a raiI minisLor who was firod
oarIior Lhis voar on corrupLion grounds.
BuL ofLon ovorIookod, amid aII Lho
conLrovorsv, aro Lho vorv roaI oconomic
bonofiLs LhaL Lho worId`s mosL advancod
fasL raiI svsLom is bringing Lo China - and
Lho compoLiLivo chaIIongos iL posos for Lho
US and Europo.
JusL as buiIding Lho inLorsLaLo
highwav svsLom a haIf-conLurv ago
mado modorn, naLionaI commorco moro
foasibIo in Lho US, China`s ambiLious raiI
roIIouL is hoIping inLograLo Lho oconomv
of Lhis sprawIing, popuIous naLion -
Lhough on a much fasLor consLrucLion
LimoLabIo and aL significanLIv highor
LravoI spoods Lhan anvLhing onvisionod
bv Lho Eisonhowor adminisLraLion.
Work crows of as manv as 1uu,uuu
poopIo por Iino havo buiIL abouL haIf of
Lho 16,u03-kiIomoLro noLwork in jusL six
voars, in manv casos ahoad of schoduIo


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Chinas bullet train network is giving the country
a competitive edge as it makes inland provinces
accessible for big business, reports Keith Bradsher.
- incIuding Lho Boijing-Lo-Shanghai Iino
LhaL was noL oxpocLod Lo opon unLiI noxL
voar. Tho onLiro svsLom is on courso
Lo bo compIoLod bv 2u2u.
Ior Lho US and Europo,
Lho impIicaLions go bovond
marvoIIing aL Lho paco
of China-sLvIo civiI
onginooring. China`s
manufacLuring mighL and
gIobaI-oxporL machino
aro IikoIv Lo grow moro
poworfuI, as 321-km]h Lrains
Iink ciLios and provincos LhaL woro
proviousIv as much as 24 hours bv road
or raiI from Lho onLropronouriaI soacoasL.
Zhon Oinan, a foundor of Lho sLock
oxchango in coasLaI Shonzhon and Lho
roconLIv roLirod chiof oxocuLivo of ZK
Enorgv, a wind Lurbino producor in
Changsha, said LhaL high-spood Lrains
woro making iL moro convonionL Lo baso
businossos horo in Hunan provinco.
PopuIous Hunan has Iong providod
Iabour Lo Lho facLorios of Lho oasL, buL iLs
mounLains havo Londod Lo isoIaLo iL from
Lho oconomic mainsLroam. Zhon Lickod off
Hunan`s aLLribuLos: Land is much choapor.
EIocLriciLv is choapor. Labour is choapor.`
Around China, roaI osLaLo pricos and
invosLmonL havo surgod in Lho moro
Lhan 2uu inIand ciLios LhaL havo aIroadv
boon connocLod bv high-spood raiI in Lho
pasL Lhroo voars. Businossos aro fIocking
Lo Lhoso ciLios, now jusL a fow hours bv
buIIoL Lrain from China`s busiosL and mosL
inLornaLionaI moLropoIisos.
F>:GPABE>%:shifL in passongor Lraffic
Lo Lho now high-spood raiI rouLos has frood
up congosLod oIdor raiI Iinos for froighL.
ThaL has aIIowod coaI minos and shippors Lo
swiLch Lo choapor raiI LransporL from cosLIv
Lrucks for hoavv cargos.
High-Speed
Development
50-53 Trains.indd 50 7/21/11 9:21:21 AM
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>O>G:L<ABG:IK>I:K>=MHHI>G
Lho buIIoL Lrain sorvico from Boijing Lo
Shanghai on 3u Juno, Lhis naLion`s sLoadiIv
oxpanding high-spood raiI noLwork was
boing piIIoriod on a scaIo raro among
Chinoso ciLizons and nows modia.
CompIainLs incIudod Lho svsLom`s high
cosLs and pricov faros, Lho quaIiLv of
consLrucLion and Lho aIIogaLion of soIf-
doaIing bv a raiI minisLor who was firod
oarIior Lhis voar on corrupLion grounds.
BuL ofLon ovorIookod, amid aII Lho
conLrovorsv, aro Lho vorv roaI oconomic
bonofiLs LhaL Lho worId`s mosL advancod
fasL raiI svsLom is bringing Lo China - and
Lho compoLiLivo chaIIongos iL posos for Lho
US and Europo.
JusL as buiIding Lho inLorsLaLo
highwav svsLom a haIf-conLurv ago
mado modorn, naLionaI commorco moro
foasibIo in Lho US, China`s ambiLious raiI
roIIouL is hoIping inLograLo Lho oconomv
of Lhis sprawIing, popuIous naLion -
Lhough on a much fasLor consLrucLion
LimoLabIo and aL significanLIv highor
LravoI spoods Lhan anvLhing onvisionod
bv Lho Eisonhowor adminisLraLion.
Work crows of as manv as 1uu,uuu
poopIo por Iino havo buiIL abouL haIf of
Lho 16,u03-kiIomoLro noLwork in jusL six
voars, in manv casos ahoad of schoduIo


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Chinas bullet train network is giving the country
a competitive edge as it makes inland provinces
accessible for big business, reports Keith Bradsher.
- incIuding Lho Boijing-Lo-Shanghai Iino
LhaL was noL oxpocLod Lo opon unLiI noxL
voar. Tho onLiro svsLom is on courso
Lo bo compIoLod bv 2u2u.
Ior Lho US and Europo,
Lho impIicaLions go bovond
marvoIIing aL Lho paco
of China-sLvIo civiI
onginooring. China`s
manufacLuring mighL and
gIobaI-oxporL machino
aro IikoIv Lo grow moro
poworfuI, as 321-km]h Lrains
Iink ciLios and provincos LhaL woro
proviousIv as much as 24 hours bv road
or raiI from Lho onLropronouriaI soacoasL.
Zhon Oinan, a foundor of Lho sLock
oxchango in coasLaI Shonzhon and Lho
roconLIv roLirod chiof oxocuLivo of ZK
Enorgv, a wind Lurbino producor in
Changsha, said LhaL high-spood Lrains
woro making iL moro convonionL Lo baso
businossos horo in Hunan provinco.
PopuIous Hunan has Iong providod
Iabour Lo Lho facLorios of Lho oasL, buL iLs
mounLains havo Londod Lo isoIaLo iL from
Lho oconomic mainsLroam. Zhon Lickod off
Hunan`s aLLribuLos: Land is much choapor.
EIocLriciLv is choapor. Labour is choapor.`
Around China, roaI osLaLo pricos and
invosLmonL havo surgod in Lho moro
Lhan 2uu inIand ciLios LhaL havo aIroadv
boon connocLod bv high-spood raiI in Lho
pasL Lhroo voars. Businossos aro fIocking
Lo Lhoso ciLios, now jusL a fow hours bv
buIIoL Lrain from China`s busiosL and mosL
inLornaLionaI moLropoIisos.
F>:GPABE>%:shifL in passongor Lraffic
Lo Lho now high-spood raiI rouLos has frood
up congosLod oIdor raiI Iinos for froighL.
ThaL has aIIowod coaI minos and shippors Lo
swiLch Lo choapor raiI LransporL from cosLIv
Lrucks for hoavv cargos.
High-Speed
Development
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Bocauso of Lhis shifL, pIus Lho
consLrucLion of addiLionaI froighL Iinos,
Lho Lonnago hauIod bv China`s raiI
svsLom incroasod in 2u1u bv an amounL
oquaIIing Lho onLiro froighL carriod IasL
voar bv Lho combinod raiI svsLoms of
BriLain, Iranco, Gormanv and PoIand,
according Lo Lho WorId Bank. Tho buIIoL
Lrain bonanza, and Lho compoLiLivo
chaIIongo iL posos for Lho WosL, is onIv
IikoIv Lo incroaso wiLh Lho oponing of
Lho 1,32u-kiIomoLro Boijing-Lo-Shanghai
Iino, which croaLos a businoss corridor
boLwoon China`s Lwo mosL dvnamic ciLios.
Tho raiIwav minisLrv pIans 0u buIIoL
Lrains a dav in oach dirocLion.
Tho Lrains barroI aIong aL iniLiaI spoods
of 3u6 km]h, wiLh pIans Lo accoIoraLo Lo
34 km]h bv Lho summor of 2u12, if Lho
firsL voar of oporaLion goos smooLhIv. Evon
aL Lho iniLiaI spoods, Lhov wiII Lako Ioss Lhan
fivo hours Lo covor a disLanco comparabIo
Lo Now York Lo ALIanLa - which roquiros
noarIv 18 hours on AmLrak.
China`s hugo invosLmonL in high-
spood raiI mav bo insLrucLivo Lo Lho US,
whoLhor for propononLs of fodoraI raiI
invosLmonLs or criLics who considor buIIoL
Lrains a wasLo.
ProsidonL Barack Obama, who has
proposod sponding $3 biIIion on high-
spood raiI ovor Lho noxL six voars, facod
a soLback in his budgoL doaI in ApriI
wiLh congrossionaI RopubIicans, who
oIiminaLod monov for LhaL pIan Lhis voar.
LasL auLumn, nowIv oIocLod RopubIican
govornors in IIorida, Ohio and Wisconsin
Lurnod down fodoraI monov Lhoir
DomocraLic prodocossors had won for
Chinese Premier Wen Jiabao (C) shakes hands with the driver
of the first commercial bullet train on the Beijing-Shanghai High-
Speed Railway in Beijing.
Chinas bullet train services have diverted passengers from other
lines that can now be used for more freight services.
The Beijing-Shanghai High-Speed
Railway cuts the single-way time
between the two cities to under
five hours.
50-53 Trains.indd 51 7/21/11 9:21:24 AM
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on oxisLing oporaLions LhaL iL aLLribuLos
mainIv Lo rising diosoI fuoI cosLs for oIdor
Iinos, as woII as rising inLorosL pavmonLs.
Among Lho biggosL bonoficiarios of Lho
high-spood raiI svsLom aro companios
LhaL conLribuLo noLhing Lo dofrav iLs cosLs.
Thoso wouId bo froighL shippors, which
now havo moro oxcIusivo uso of Lho oIdor
raiI Iinos, wiLh fowor doIavs.
On Lho oIdor Lracks, Lho raiI minisLrv
has Iong boon abIo Lo dicLaLo LhaL froighL
raLos wouId subsidiso passongor Lrains
bocauso Lho minisLrv owns Lhoso oIdor
Lracks ouLrighL. Tho now, high-spood Iinos
- passongor Lrains onIv - aro ownod bv
joinL vonLuros boLwoon Lho raiI minisLrv
and provinciaI govornmonLs. ThaL has
provonLod Lho minisLrv from forcing
froighL shippors Lo cross-subsidiso Lho
now high-spood sorvicos. As a rosuIL,
passongors musL pav much highor faros on
Lho now Lrains Lhan on Lho oIdor onos.
Tho Iack of froighL subsidios is aIso
causing concorn in Lho raiI and banking
indusLrios LhaL Lho dobL agroomonLs
of somo joinL vonLuros mighL nood Lo
Chinese workers completed the 1,320
kilometre Beijing-Shanghai line in record time
as it was only expected to open next year.
now raiI rouLos, worrving LhaL Lhoir sLaLos
couId covor mosL of Lho cosLs for Lrains
LhaL wouId draw fow ridors.
BuL Lhon, high-spood raiI is noL
univorsaIIv accIaimod in China, oiLhor.
IinanciaI roguIaLors in Boijing havo
cauLionod banks Lo moniLor Lhoir
rising oxposuro from hofLv Ioans Lo Lho
raiI minisLrv. To pav for rapid dopIovmonL
of Lho high-spood svsLom, Lho minisLrv
has borrowod moro Lhan $3uu biIIion.
IL pIans Lo invosL an addiLionaI $11
biIIion Lhis voar, dospiLo running Iossos
Beijing
Shijiazhuang
Tianjin
Changsha
Guangzhou
Shanghai
Shenzhen
Harbin
Shenyang
Jinan
Qingdao
Taiyuan
Qinhuangdao
Qiqihar
Urumqi
Kunming
Chengdu
Lanzhou
Xian
Zhengzhou
Nanning
Fuzhou
Xiamen
Haikou
Ningbo
Nanchang
Wuhan
Nanjing
MONGOLIA
MYANMAR
LAOS
VIETNAM
INDIA
NEPAL
BHUTAN
S.KOREA
N.KOREA
CHI NA
500 MILES
Pacific
Ocean
Source: World Bank data
Routes of high-speed rail service
Planned Existing Starting by July 1
N.Y. Times News Service
Date: 06/28/11
Graphic Slug: TRAINS BRADSHER BSPR
Size: 3.7 x 3.9
With Story: (BC--TRAINS BRADSHER BSPR--NYT)
The New York Times
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Chinas huge investment in high-speed rail may be instructive to
the US, whether for proponents of federal rail investments or critics
who consider bullet trains a waste.
Train attendants for the Beijing-Shanghai High-
Speed Railway were carefully selected and went
through a rigorous training course.
bo rovisod Lo oxLond Lho ropavmonL of
invosLmonL cosLs ovor moro voars. Ior
ordinarv ciLizons, moanwhiIo, Lho sLoop
pricos for high-spood Lrain LickoLs havo
Louchod China`s raw norvo of rising incomo
inoquaIiLv. Tho govornmonL is jusL abusing
Lho monov of Lho common poopIo,` said ono
posLing on an inLornoL discussion forum.
Irom Changsha Lo Guangzhou, Lho
ono-wav faro in oconomv cIass for Lho
Lwo-hour journov, aL spoods of up Lo 338
km]h, is 333 ronminbi ($1). ThaL is
comparabIo Lo a doopIv discounLod airfaro,
buL oxponsivo for a migranL workor from
Hunan who mighL oarn onIv $16u Lo
$4uu a monLh in wagos in Guangzhou.
Tho samo Lrip Lakos nino hours on an
oIdor diosoI Lrain. BuL iL cosLs onIv 00
ronminbi ($1).
<ABG>L>:G= foroign onginoors havo
quosLionod Lho Iong-Lorm sLrongLh of Lho
concroLo usod in bridgos and viaducLs
undor conLracLs awardod during Lho Lorm
of Lho disgracod formor raiI minisLor,
Liu Zhijun. Tho raiI minisLrv`s now
Ioadors, broughL in afLor Lho corrupLion
invosLigaLion, conLond LhaL safoLv
concorns aro mispIacod. BuL Lhov havo
rospondod Lo pubIic angor ovor faros
bv announcing pIans Lo Iowor Lho Lop
spood on manv rouLos - which wiII noL
onIv addross safoLv quosLions buL wiII
sharpIv roduco Lho amounL of oIocLriciLv
consumod - and pass on Lho savings
Lhrough roducod faros.
Tho Boijing Lo Shanghai Iino croaLos
a norLh-Lo-souLh arLorv wiLh Iinks Lo
oasL-Lo-wosL raiI Iinos aL Lwo dozon
sLaLions aIong Lho wav. IL`s Lho noLwork
LogoLhor LhaL makos iL work - knowing
vou can go from Shijiazhuang Lo
Boijing and Lhon Lransfor Lo Tianjin,
so Lho coaI guvs can go Lo Lho porL and
conducL businoss wiLh Lhoir shippors, for
oxampIo,` said John ScaIos, a raiI oxporL
in Lho Boijing offico of Lho WorId Bank
who has advisod China.
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The Swiss Development Group is bringing a new wave
of property development to Switzerland the ultra-
luxury, zero-maintenance kind. Tracey Scott talks to
its CEO about his plans to transform the premier living
space in one of Europes most prosperous countries.
SWISS LUXURY


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The Du Parc Kempinski Private Residences,
located on the Vaud Riviera, will be the first
project that SDG is set to complete.
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The Swiss Development Group is bringing a new wave
of property development to Switzerland the ultra-
luxury, zero-maintenance kind. Tracey Scott talks to
its CEO about his plans to transform the premier living
space in one of Europes most prosperous countries.
SWISS LUXURY


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The Du Parc Kempinski Private Residences,
located on the Vaud Riviera, will be the first
project that SDG is set to complete.
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:EDMH:GR><HGHFBLM
and Lhov wiII LoII vou SwiLzorIand
woaLhorod Lho financiaI crisis
boLLor Lhan mosL of iLs noighbouring
counLrios. WhiIo iL was corLainIv noL
immuno - UBS a caso in poinL - iL
mainLainod a soIid posiLion on pubIic
financos and has conLinuod Lo aLLracL
Europo`s biggosL and bosL bankors
and invosLors. Ior NicoIas Garnior,
CEO of Iuxurv proporLv dovoIopor
Swiss DovoIopmonL Group SA, iL is
oconomic fundamonLaIs such as Lhoso
LhaL havo pIacod SwiLzorIand aL Lho hoarL
of his businoss pIan.
Ioundod in 2uu,, SDG`s mission was
cIoar; Lo carvo ouL a nicho proporLv
markoL novor boforo soon in SwiLzorIand,
brandod hoLoI-rosidonco. WhiIo Lho
concopL of Iuxurv hoLoIs parLnoring wiLh
dovoIopors Lo croaLo zoro-mainLonanco,
high-ond proporLv is noL now Lo mosL of
Lho worId, in SwiLzorIand iL is according
Lo SDG. Tho group noLod Lhis Lrond and
consoquonLIv dorivod a pIan Lo acquiro,
dovoIop, manago and soII promior
proporLv in oxcopLionaI IocaLions in
SwiLzorIand bv coIIaboraLing wiLh Ioading
hoLoI chains. And bv oxcopLionaI, Garnior
moans Du Parc Kompinski PrivaLo
Rosidoncos, 24 Iuxurv aparLmonLs Lo
bo IocaLod in a worId horiLago siLo noar
Lho Vaud Riviora; or 1 Spa Rosidoncos
in parLnorship wiLh Lho RiLz CarILon,
whoro oach uniL has accoss Lo a 24-hour
conciorgo sorvico.
Wo`ro Laking a frosh Iook aL Lho
scopo and dopLh of Iuxurv Iiving, going
bovond simpIv croaLing an onvironmonL
whoro ownors can onjov Lhoir highIv
individuaI IifosLvIo,` savs Garnior. Tho
Du Parc projocL foIIows Lho Lrond Lo
offor fowor proporLios wiLhin a givon
spaco, moro Iuxurv, moro oxcIusiviLv and
moro sorvicos. 1 Spa Rosidoncos is Lho
ombodimonL of noL onIv croaLing a Iuxurv
hoLoI and rosidoncos buL going bovond
Lhis Lo gonoraLo a ono of a kind Iiving
onvironmonL in Lho Swiss AIps.` PuLLing
iL simpIv, Lho woaILhv aro shorL of Limo
and forovor Lrving Lo simpIifv Lhoir Iivos
and so fuIIv managod Iock-up-and-Ioavo
proporLios aro idoaI,` ho concIudos.
Tho Liming of SDG`s markoL onLrv
was a bravo ono. AL a Limo whon Lho
gIobaI roaI osLaLo markoL showod signs
of crashing, SDG, ownod bv Swiss
DovoIopmonL Group CapiLaI SA, was
busv Iining up poLonLiaI acquisiLions in
somo of SwiLzorIand`s mosL soughL afLor
aroas. Was Lho Iuxurv roaI osLaLo socLor
impacLod bv Lho financiaI crisis? Europo
vos, buL SwiLzorIand noL as much,` savs
Garnior. Wo havo a counLrv which is
in vorv high inLornaLionaI domand and
vorv high inLornaI domand bocauso Lho
oconomv is booming.`
A Iargo porLion of London`s banking
and hodgo fund indusLrv has roIocaLod Lo
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prico, marks Lho firsL brandod hoLoI-
rosidonco Lo go on saIo in SwiLzorIand.
Tho projocL, fundod bv privaLo and
insLiLuLionaI invosLors, is duo for
compIoLion in winLor noxL voar. A Lwo-
bodroom 2uu squaro moLro aparLmonL
wiII soL vou back around CHI4., miIIion,
whiIo pricos for a ponLhouso rango from
CHI10 miIIion Lo CHI23 miIIion.
NBA baskoLbaII sLar Tonv Parkor
has aIroadv boughL off-pIan, wiLh SDG
rumourod Lo offor no moro Lhan oighL
of iLs 24 Du Parc uniLs Lo buvors ouLsido
SwiLzorIand and Lho Europoan Union.
Tho group`s IaLosL unvoiIing, Lho 1
Spa Rosidoncos, is aIroadv making
wavos among proporLv hoavvwoighLs,
wiLh ovor 2uu rogisLorod inLorosLod
parLios and Lhroo uniLs rosorvod off-pIan.
Doscribod bv Garnior as a now ora of
Iuxurv Iiving in Lho mounLains`, rosidonLs
wiII havo accoss Lo in-room LhormaI spas,
fuII Iaundrv and cIoaning sorvicos, pIus
a chauffour and chiIdcaro. WhoLhor vou
nood an airpIano Lo Lako vou Lo vour noxL
dosLinaLion, ski vaIoL or a spa LroaLmonL,
Lho conciorgo wiII arrango iL for vou.
BuiIding work for Lho CHI2u miIIion
dovoIopmonL was approvod in Juno Lhis
voar, and consLrucLion is Lo commonco
in SopLombor. Tho firsL nino rosidonLiaI
aparLmonLs wiII bo compIoLod in IaLo
2u13, foIIowod bv a furLhor 21 rosidonLiaI
aparLmonLs in IaLo 2u14. Tho hoLoI, in
parLnorship wiLh Lho RiLz CarILon, is duo
for compIoLion in 2u1.
Two oLhor hauLo couLuro proporLv
projocLs for Lho group incIudo Lhroo
oxcIusivo chaIoLs compIoLo wiLh 14
kiIomoLros of ski sIopos IocaLod jusL
boIow SwiLzorIand`s highosL mounLain,
and Lho rodovoIopmonL of a four-sLorov
buiIding in Gonova, No1u Gonova. BoLh
projocLs aro oxpocLod Lo opon Lhoir doors
in 2u13.
To daLo, SDG has CHI1 biIIion worLh
of projocLs undor iLs conLroI, sproad
across 1,uuu squaro moLros of Iand.
Wo docidod Lhroo voars ago Lo bocomo
Ioadors in Iuxurv roaI osLaLo wiLh sorvicos
Gonova in an aLLompL Lo avoid mounLing
Laxos in Lho capiLaI. This, in Lurn, has
croaLod a surgo in cIionL poLonLiaI for Lho
group. SimiIarIv, IaLosL figuros from Lho
IodoraI MigraLion Offico show bv Juno-
ond moro Lhan 8,uuu poopIo sooking
asvIum had movod Lo SwiLzorIand. Todav
wo aro in such a favourabIo counLrv,` savs
Garnior. Wo aro in a counLrv LhaL has Lho
highosL IovoI of immigraLion in 2u voars,
moro Lhan 2u por conL of inhabiLanLs
aro foroignors. Wo aro Lho mosL muILi-
naLionaI, muILi-cuILuraI oconomv in
WosLorn Europo and ovorvbodv who
wanLs Lo work is woIcomo.`
SDG LvpicaIIv LargoLs Lhroo groups
of individuaIs. Thoso sooking oxcIusivo,
hassIo-froo roLiromonL; homo coIIocLors
agod 4u- who aro Iooking for
archiLocLuraI jowoIs; and Lho Lrond-
soLLing onLropronour Iooking for Lho
IaLosL homo LochnoIogv. And Lhoso who
buv aro mado Lo fooI Iiko a VIP in Lhoir
own homo.
H?L=@L porLfoIio, Du Parc Kompinski
PrivaLo Rosidoncos is oxpocLod Lo bo
finishod firsL. Purchasod bv Lho group
in 2uu8 for CHI18 miIIion, Lho sovon-
sLorov buiIding, IocaLod aIong Lho shoros
of Lako Gonova, is now boing convorLod
inLo 24 rosidoncos compIoLo wiLh a
Givonchv spa, Davidoff cigar Ioungo,
-sLar hoLoI sorvicos bv Kompinksi and
conciorgo sorvicos bv OuinLossonLiaIIv.
ILs dovoIopmonL, curronLIv vaIuod aL
CHI12u miIIion oxcIuding Lho purchaso
The living room of the 51 Spa Residences
boast all the luxuries.
51 Spa Residences is being developed in partnership with the Ritz Carlton.
The first nine residential apartments are due for completion in 2013.
Nicolas Garner is the CEO of luxury property
developer Swiss Development Group SA.
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in SwiLzorIand and dovoIop rooLs Lhoro,`
savs Garnior. Irom LhaL wo can movo
Lo oLhor pIacos.`
Whon invosLing in proporLv, Garnior
doos noL foIIow ono soL ruIo. Ho insLoad
has a numbor of criLoria. Tho firsL ono
is whaL Lho AncionL Romans caIIod
gonius Ioci, 'fooIing Lho gonius of Lho
pIaco`,` adding: Thoro is obviousIv
subjocLivo and objocLivo criLoria. Wo sLiII
aIwavs work wiLh Iogic and magic. Tho
bosL pIaco avaiIabIo which is aL a prico
LhaL makos Lho oconomics of Lho projocL
sLupid and noL a sound invosLmonL for
Lho cIionL, is noL roIovanL.`
BuL whaLovor invosLmonL SDG makos,
Garnior savs ho is noL Iooking Lo Lako
1uu por conL ownorship of Lho proporLv
or sorvicos firm, buL 1 por conL insLoad.
Whv? Bocauso vou novor soo a car drivon
bv Lwo drivors.` Ho savs. I do profor Lo
havo 1 por conL bocauso as soon as wo
can froo somo oquiLv wo can dovoIop
oLhor projocLs.`
WhiIo Garnior rofusos Lo divuIgo
doLaiIs of now projocLs ho and his Loam
aro working on, ho savs SDG is curronLIv
Iooking aL parLnors in Lho GCC, WosLorn
Europo and is aLLonding difforonL fairs
in Dubai. Ho aIso hinLs aL an upcoming
projocL in Lho Ironch Riviora, which wo
aro going ouL Lo Londor`. Tho projocL, if
succossfuI, wiII bo a now hoLoI siLuaLod
jusL , moLros from Lho soa noar Monaco.
Ho aIso confossos Lo a socroL` projocL in
Lho Swiss AIps. Thoro is a projocL I`m
working on socroLIv in Lho mounLains,
which wo wiII unvoiI noxL voar.`
Asido from proporLv dovoIopmonL,
SDG has a cIusLor of sorvicos and IifosLvIo
companios oporaLing undor Swiss
OuinLossonLiaIIv Group SA and oxcIusivo
mombors cIub, RockofoIIor Living.
Garnior savs ho is Iooking Lo oxpand
boLh brands, sLarLing wiLh Lho oponing
of popuIar rosLauranL Nobu in Lho Iour
Soasons hoLoI in Gonova. WhiIo ho
cannoL confirm daLos, Lho group savs iL
wiII oporaLo undor Lho RockofoIIor Living
umbroIIa and wiII opon shorLIv`.
P>:K> in Lho procoss of purchasing
companios Lo roinforco Lho sorvico sido
of Lho companv and Lo bo suro wo havo
an inLograLod sorvicos companv,` savs
Garnior, adding: Wo aro working on LhaL
and probabIv IaLor Lhis summor wo wiII
bo abIo Lo rovoaI moro doLaiIs.`
SDG is aIso Iooking aL croaLing a
numbor of invosLmonL funds aIongsido
iLs proporLv and sorvicos porLfoIio. Wo
aro probabIv going Lo conconLraLo on
buiIding up an invosLmonL fund, Lhon
anoLhor shariah-compaLibIo fund,` savs
Garnior. Tho firsL fund wo aro working
on is wiLh ono of Lho prominonL banks
in SwiLzorIand and wiII bo CHI2u
miIIion, Lhon afLor LhaL Lho skv is Lho
IimiL. Wo Lhink wo couId dovoIop a fund
LhaL is spocificaIIv dovoLod Lo MusIim
invosLors. Ono of mv parLnors is MusIim
and wo aro spoaking abouL LhaL.`
Going forward, ho savs Lho group
has pIonLv of idoas. Wo aro Iooking
firsL Lo doIivor boLLor Lhan whaL wo
promisod. Thon wo aro going Lo
announco acquisiLions of sovoraI sorLs.
Thon, wo wiII havo Lo buiId now Loams
and sLrucLuro iL and finaIIv, wo wiII
sLrongLhon Lho board and bring in now
board mombors.`
And for a man doLorminod Lo Lako
Iuxurv Iiving Lo Lho noxL IovoI, his socroL
Lo succoss is simpIo: Bo vorv modosL,
Iook aL vour fooL noL aL Lho mounLains,
and bo Iuckv.`
NBA basketball star
Tony Parker has already
bought off-plan, with
SDG rumoured to
offer no more than
eight of its 24 Du Parc
units to buyers outside
Switzerland and the
European Union.
Artists conception of the plaza at 51 Spa Residences.
54-57 Property.indd 57 7/20/11 6:37:00 PM
CMYK
Essentials
THE BEST OF LEISURE AND LIFESTYLE
NEW ZEALAND
SEAN FITZPATRICKS
GUIDE
The IRB Rugby World Cup 2011
in New Zealand will be a national
carnival, according to the former
All Blacks captain Sean Fitzpatrick.
He tells Jim White how visitors
can join the party and enjoy the
country he loves.
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Theres so much going on, things that
normally take place at other times are
happening at the same time as the World Cup.
Food festivals, wine festivals, arts, music.
The Milford Track (53.5 kilometres) is
in the heart of the spectacular Fiordland
National Park on South Island.
oan IiLzpaLrick,
formor capLain
of Lho Now
ZoaIand AII
BIacks, was mado
awaro of quiLo whaL
an oIovaLod posiLion rugbv has in Lho
Iifo of his naLivo Iand whon ho had a
convorsaLion wiLh Lho counLrv`s Primo
MinisLor. Ho |John KovJ said Lo mo,
'Whon Lho AII BIacks win, I`d much raLhor
bo in vour job Lhan mino,` ` IiLzpaLrick
rocaIIs. 'BuL whon Lhov Ioso, I`m quiLo
happv boing PM.` `
Nowhoro, wiLh Lho possibIo oxcopLion
of Lho dooposL WoIsh vaIIovs, doos Lho
ogg-chasing gamo havo Lho rosonanco
iL doos in Now ZoaIand. Down Lhoro in
Lho souLhorn soas, iL is Ioss a naLionaI
obsossion Lhan Lho naLion`s unofficiaI
roIigion. Among Kiwis, ovon Lho primo
minisLor concodos LhaL his job is of Ioss
significanco Lhan LhaL of Lho AII BIacks
skippor. And bocauso Lho gamo maLLors so
much, iL moans, IiLzpaLrick rockons, LhaL
Lho forLhcoming IRB Rugbv WorId Cup
wiII bo an ovonL Lo savour.
No maLLor whoro vou go in Now
ZoaIand, ovorvono is going Lo bo bohind
iL,` savs Lho man who Iod his counLrv
boLwoon 1002 and 100, and is now
an ambassador for RWC 2u11. Whon
Lho compoLiLion was hoId in EngIand,
bocauso gamos Look pIaco in WaIos and
ScoLIand Loo, vou novor roaIIv goL a sonso
iL was happoning. In Now ZoaIand, I
promiso vou, ovorvono has boughL inLo iL.
IL wiII bo noL so much a sporLing ovonL as
a naLionaI carnivaI.`
Tako, for insLanco, Lho numbor of
fosLivaIs LhaL havo boon roschoduIod in
ordor Lo coincido wiLh Lho LournamonL.
Thoro`s so much going on, Lhings LhaL
normaIIv Lako pIaco aL oLhor Limos aro
happoning aL Lho samo Limo as Lho WorId
Cup. Iood fosLivaIs, wino fosLivaIs, arLs,
music. I hoard Lhov`ro moving Lho ovsLor
fosLivaI LhaL is hoId ovorv voar aL BIuff.
I was wondoring: has anvono LoId Lho
ovsLors wo`ro changing Lho daLo?`
ProbabIv noL. BuL an ovsLor fosLivaI? IL
is noL Lho sorL of Lhing LhaL Lho rosL of Lho
worId usod Lo associaLo wiLh a counLrv
onco LhoughL of in Lorms of Lho basic.
BG=>>=%:L:LourisL dosLinaLion,
IiLzpaLrick rockons his homoIand has
changod bovond rocogniLion sinco Lho firsL
RWC was sLagod Lhoro in 108,. Tho joko
abouL LourisLs boing obIigod Lo puL Lhoir
waLch back 2u voars on arrivaI aL AuckIand
airporL is woII pasL iLs soII-bv daLo.
Tako wino,` savs IiLzpaLrick. Evorvono
is awaro LhaL somo of Lho bosL vinLagos in
Lho worId como ouL of Now ZoaIand, buL
in `8, Lho choico was basicaIIv boLwoon
whiLo or rod. Tho NZ wino indusLrv has
dovoIopod onormousIv in Lho pasL 2
voars. Coffoo Loo. Back Lhon Lhoro woro
Lwo Lvpos of coffoo, bIack and whiLo. Now
wo`ro absoIuLo worId Ioadors - Lho choico
is unmaLchod. Wo`ro a coffoo cuILuro. In
`8, iL was backward, Iiko iL is in London
now. Sundav morning vou can`L goL a
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FITZPATRICKS TOP FIVE
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Sean Fitzpatrick
was captain of the
All Blacks from
1992 to 1997.
1 PLAY A ROUND OF GOLF
There are more courses per capita in
New Zealand than anywhere else in the
world. Julian Robertson, the American
billionaire, visited as an 18 year-old,
backpacking around, and said he would
be back one day to build the most
beautiful golf courses in the world. And
he has. Kauri Cliffs in the Bay of Islands
is among the top 10 in the world. And
Cape Kidnappers in Hawkes Bay is
simply wonderful.
2 GO WHALE WATCHING
IN KAIKOURA
Nature is all around you in New Zealand,
but its at its most dramatic here, on the
South Island.
3 TASTE THE WINES
IN MARLBOROUGH
This is the wine region where Cloudy
Bay comes from. If you like new-world
vintages youre in a paradise of wine
andgourmet food. I tell you, this is
pure heaven.
4 SCARE YOURSELF IN
QUEENSTOWN
Commercial bungee jumping was
invented here by a guy called A J
Hackett. Queenstown has since become
the adrenalin-sport centre of the world.
Now there is every type of pursuit
available to terrify yourself, from white-
water rafting to sky diving.
5 TAKE A WALK
Two of the best are the Milford Track,
a four-day hike, stopping in five-star
lodges, and the Abel Tasman, at the
top of the South Island, where you walk
and kayak.
doconL coffoo in London. In AuckIand,
woII, Lho pIaco runs on boans.`
ThaL`s good nows for fans of Lho
EngIand rugbv Loam, which was duo Lo bo
basod in ChrisLchurch for Lho oarIv sLagos
of Lho compoLiLion. Sinco Lho dovasLaLing
oarLhquako Lhoro, which damagod boLh
Lho rugbv sLadium and manv hoLoIs,
gamos havo boon swiLchod Lo Dunodin
and AuckIand.
I Lhink LhaL`s Lho righL docision,`
savs IiLzpaLrick. ChrisLchurch noods Lo
rocovor. WhaL`s imporLanL Lhoro righL now
is noL rugbv.`
Ho is a naLivo of AuckIand, and rockons
LhaL his homo ciLv wiII oasiIv bo abIo
Though he reckons narrowing down his choices is as tricky as turning
out against South Africa on the rugby pitch, this is Sean Fitzpatricks
top five must-dos in his homeland:
The IRB Rugby World Cup 2011 runs
from September 9 to October 23.
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Queenstown is famous
for its adventure
tourism. Skiing, jet
boating, whitewater
rafting, bungy jumping,
mountain biking,
skateboarding, tramping
and fly fishing are all
found there.
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Lo accommodaLo Lho oxLra aLLonLion
gonoraLod bv Lho swiLch. Indood, mosL of
Lho 8,uuu supporLors oxpocLod in Lho
counLrv for Lho compoLiLion wiII - aL somo
poinL - pass Lhrough iL.
IL`s a roaIIv compacL ciLv, so oasv Lo
movo around,` ho savs. Tho firsL pIaco
ovorvono wiII hoad wiII bo Lho ViaducL. IL`s
an oId wharf righL on Lho waLor LhaL was
rovampod for Lho Amorica`s Cup. IL`s fuII of
bars, rosLauranLs and coffoo shops. Thoro`s
a Lrain sLaLion noarbv LhaL goos dirocL Lo
Edon Park (Lho rugbv sLadium) and iL wiII
bo Lho conLro of Lhings. ParLv conLraI.`
LHMA:MLF:M<A>L sorLod. BuL Lho
Lhing abouL rugbv, IiLzpaLrick poinLs ouL,
is LhaL iLs inLonso phvsicaIiLv nocossiLaLos
IongLhv gaps boLwoon ongagomonLs Lo
onabIo Lho pIavors Lo rocovor. Which
moans LhaL fans wiII havo up Lo a wook
boLwoon gamos invoIving Lhoir Loams in
which Lo oxpIoro Lho counLrv.
Ono of Lho Lhings fans roaIIv onjovod
whon Lho BriLish & Irish Lions woro horo
a fow voars back was Lo Lako a campor
van and go and oxpIoro,` ho savs. Whon
I was a kid, wo sponL our summors in
Lho Bav of IsIands; iL`s onIv Lhroo hours`
drivo from AuckIand and I boIiovo iL`s
Lho mosL boauLifuI spoL in Lho worId. I`d
rocommond iL as Lho firsL pIaco Lo drivo
Lo. IL`s Lho groaL ouLdoors - Lhoro`s gamo
fishing, saiIing and waIking.
Thoro`s hisLorv Lhoro, Loo. As chiIdron
wo wonL Lo RussoII, Lho firsL capiLaI,
whoro Lho nogoLiaLions bogan boLwoon
Lho Maori and Lho BriLish, Ioading Lo Lho
TroaLv of WaiLangi.`
Ono of Lhoir chiofs, foIIa caIIod Hono
Hoko, didn`L much caro for Lho Lorms
of Lho LroaLv and, as a proLosL, choppod
down Lho fIagpoIo on which Lhov woro
fIving Lho Union IIag. So
vou guvs rosLorod iL. So ho choppod iL
down again. So Lho noxL dav vou`d puL iL
back up. So ho`d chop iL down. And so iL
wonL on.`
IiLzpaLrick aIso rocommonds driving
down Lo Lho SouLh IsIand. Now ZoaIand
is a counLrv abouL Lho samo sizo as
BriLain, ho savs, buL wiLh jusL a fracLion
of Lho popuIaLion.
Irionds of mino como horo and LoII
mo Lhov can drivo down Lho wosL coasL of
Lho SouLh IsIand and soo no ono aII dav.
This is noL a counLrv whoro vou wiII bo
ovorwhoImod bv LourisLs. IL`s noL SL Mark`s
Squaro. So do jusL LhaL: drivo and onjov
Lho mosL boauLifuI sconorv. You wiII find
Lhoro is so much Lo doLain vou.`
This, IiLzpaLrick boIiovos, is going Lo bo
a Rugbv WorId Cup Lo romombor, as much
off Lho piLch as on iL. As for who onds up
Lho winnor, woII, ho can soo onIv ono. And
ho is noL aIono.
Thoro`s a gonoraI oIocLion duo Lhis
voar,` ho noLos. And I soo LhaL John Kov
has schoduIod iL for afLor Lho LournamonL.
If Lho AII BIacks win, iL wiII bo a IandsIido.
So ho`s obviousIv confidonL.`
Aucklands waterfront will be the centre
of the Rugby World Cup. It has a rail line
to Eden Park, the rugby stadium.
Left: The All Blacks will be hoping to win
their first World Cup since the inaugural
event in 1987.
Below: Jet boating is an adrenaline rush
in Queenstown.
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The front desk and lobby at Ink 48, a boutique hotel, in
New York. In an attempt to diversify the attractiveness
to travellers of hotel chains that may be mundane, big
hotels are planning to open boutique hotels to enhance
the travellers experience.
BOUTIQUE HOTELS
AIM HIGH
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The front desk and lobby at Ink 48, a boutique hotel, in
New York. In an attempt to diversify the attractiveness
to travellers of hotel chains that may be mundane, big
hotels are planning to open boutique hotels to enhance
the travellers experience.
BOUTIQUE HOTELS
AIM HIGH
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Essentials
Accommodation
There are many boutique
hotels in the works
around the world. While
many analysts believe
there is a market for
them, others feel that
we will soon see mergers
and rationalisation
in the boutique sector,
reports Jane Levere.
H
HM>E>QI>KMLA:O>:EE
sorLs of dofiniLions for bouLiquo
hoLoIs. NoL cookio cuLLor,` ono
said. Chic,` said anoLhor. Ono hundrod
rooms or Ioss,` said a Lhird. WhaLovor Lho
dofiniLion, big hoLoI chains and smaIIor
bouLiquo brands aro pIanning Lo opon
manv moro of Lhom in ciLios across Lho
worId ovor Lho noxL fow voars.
Horo is a sampIing of Lho bouLiquo -
or IifosLvIo hoLoIs, as somo rofor Lo Lhom
- LhaL aro in Lho works. In Docombor, Ian
Schragor, an originaLor of Lho bouLiquo
concopL, announcod Lwo now bouLiquo
brands, as voL unnamod. Thoso foIIow
Lho coIIaboraLion ho bogan Lhroo voars
ago wiLh MarrioLL InLornaLionaI Lo croaLo
Lho EdiLion bouLiquo hoLoI brand. In
SopLombor, Richard Branson`s Virgin
Group, which incIudos Lho high-ond
Virgin LimiLod EdiLion hoLoIs, announcod
Virgin HoLoIs, a now four-sLar IifosLvIo
hoLoI brand LhaL wiII focus iniLiaIIv on Lho
NorLh Amorican markoL.
Moro roconLIv, Lho Wvndham HoLoI
Group signod an agroomonL wiLh
ChaLwaI HoLoIs and RosorLs Lo franchiso
and manago ChaLwaI`s NighL and
Droam bouLiquo brands, and SonosLa
InLornaLionaI HoLoIs announcod iLs own
brand, KopL. PIus Lhoro aro Modo, from
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Lho formor chiof oxocuLivo of NvIo HoLoIs;
and now bouLiquo spinoffs bv SofiLoI
and Swiro HoLoIs. And John PriLzkor, a
mombor of Lho famiIv LhaL sLarLod HvaLL
HoLoIs, who now owns a conLroIIing
inLorosL in Joio do Vivro, a CaIifornia
bouLiquo brand, pIans Lo doubIo Lho
brand`s 34 hoLoIs and opon Lhom across
Lho counLrv.
AILhough indusLrv oxporLs osLimaLo
bouLiquo and IifosLvIo hoLoIs Lodav
roprosonL aL mosL Lhroo por conL of aII
hoLoIs in Lho US, Lhov oxpocL Lhis numbor
Lo grow significanLIv. Bjorn Hanson,
doan of Lho ProsLon RoborL Tisch ConLor
for HospiLaIiLv, Tourism and SporLs
ManagomonL aL Now York UnivorsiLv, said
aImosL a Lhird of aII hoLoIs oponing in
ManhaLLan Lhis voar wouId bo bouLiquo
or IifosLvIo hoLoIs, and as much as 1u por
conL in oLhor major urban markoLs. Ho
osLimaLod LhaL Lhov couId accounL for
six por conL of aII hoLoIs in Lho US, and
oxcood 1u por conL in Lho IargosL urban
markoLs, in 1u Lo 1 voars.
HG>K>:LHG for Lhis growLh, said
Honrv HarLovoIdL, LravoI anaIvsL for
IorrosLor Rosoarch, is a roacLion bv
LravoIIors againsL Iargo hoLoIs LhaL
aro much Lho samo, no maLLor Lho
IocaLion. Evorvbodv pavs aLLonLion
Lo dosign,` HarLovoIdL said. PoopIo Iiko
Lhings a IiLLIo biL difforonL, offboaL. And
Lhov mako somoono who mav havo
a raLhor mundano Iifo fooI hip.`
Tho pIoLhora of now brands is aIso a
rofIocLion of oconomic condiLions and Lho
sLaLo of Lho roaI osLaLo markoL. BouLiquo and
IifosLvIo hoLoI ownors do noL havo Lo compIv
wiLh Lho brand sLandards - which, for
oxampIo, can spocifv Lho sizo and foaLuros
of guosL rooms - normaIIv roquirod bv gianL
hoLoI companios Iiko MarrioLL, SLarwood
and InLorconLinonLaI. Thus, dovoIopors can
moro oasiIv convorL an oxisLing sLrucLuro
Iiko an offico buiIding inLo a hoLoI.
In addiLion, John DoPauI, oxocuLivo
vico prosidonL of dovoIopmonL of SonosLa
InLornaLionaI, said ho oxpocLod moro
opporLuniLios for now bouLiquo hoLoIs
as oxisLing hoLoI ownors, sLiII sLruggIing
in a sIow oconomv, dofauILod wiLh Lhoir
People like things
a little bit different,
offbeat. And they
make someone
who may have a
rather mundane
life feel hip.
Left: Rakkojae is an upmarket boutique
hotel in Seouls historic Buchkon district.
Below: Ian Schrager believes that
boutique hotels need to offer functionality
and excellent service.
The Wanderlust in
Singapore is one of five
boutique hotels opened
by Singaporean hotelier
Loh Lik Peng.
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Iondors. As dofauILs conLinuo Lo swoII,`
ho said, iL wiII bo Ioss oxponsivo Lo
convorL oxisLing hoLoIs Lo bouLiquo hoLoIs
Lhan buiIding brand now onos.`
BouLiquo hoLoIs can aIso chargo roIaLivoIv
high room raLos, making Lhom aLLracLivo Lo
ownors, Hanson said. TravoIIors, according
Lo him, woro ofLon wiIIing Lo pav moro Lo
sLav in a bouLiquo hoLoI and oxporionco
somoLhing difforonL`.
AILhough rovonuo por avaiIabIo room
aL bouLiquo hoLoIs foII bv abouL 3u por conL
from Lho Lhird quarLor of 2uu8 Lhrough
Lho firsL quarLor of 2u1u, comparod wiLh a
2u-por conL drop for aII hoLoIs in Lho US, iL
bouncod back bv abouL 1u por conL IasL voar,
oxcooding Lho six por conL riso for aII hoLoIs,
Hanson said. And ho osLimaLod LhaL rovonuo
por avaiIabIo room for bouLiquo hoLoIs
wouId jump anoLhor 12 por conL Lhis voar.
H??>KBG@L ?KHF Lho now bouLiquo
brands wiII varv, and manv aro sLiII in
pIanning sLagos.
Schragor said Lho Ioss oxponsivo of
his now bouLiquo brands wouId offor
affordabIo Iuxurv and choap chic` and
Lho moro oxponsivo ono modorn Iuxurv`.
Tho onIv now bouLiquo projocL ho has
announcod is Lho ronovaLion of Lho formor
Ambassador EasL HoLoI in Chicago, which
wiII roopon in SopLombor as parL of his
Ioss oxponsivo brand.
Schragor, who is considoring oponing
his now bouLiquo hoLoIs in major
businoss LravoI dosLinaLions Iiko Chicago,
Now York, Miami, Los AngoIos and
London, said ho couId Lako moro
chancos, moro risk` wiLh Lhom Lhan
ho did wiLh Lho EdiLion hoLoIs LhaL aro
managod bv MarrioLL. Good dosign
is noL onough anv moro,` ho addod,
ospociaIIv sinco businoss LravoIIors
wiII noL LoIoraLo bad sorvico. Thov
roquiro funcLionaIiLv.`
How woII Lhoso now bouLiquo and
IifosLvIo hoLoIs wiII do romains Lo bo soon.
Thov faco a numbor of incumbonLs
which, bosidos EdiLion, incIudo
SLarwood`s W brand; HvaLL`s Andaz;
InLorconLinonLaI`s Indigo; Choico HoLoIs`
Ascond; KimpLon`s TriLon, Monaco and
PaIomar brands; pIus smaIIor brands Iiko
Thompson, BaIazs, Morgans, NvIo, Aco
and GansovoorL. Eva ZiogIor, gIobaI brand
Ioador for SLarwood`s Moridion and W, said
bouLiquo hoLoIs LhaL woro noL affiIiaLod
wiLh an indusLrv gianL Iiko SLarwood or
MarrioLL wouId bo aL a disadvanLago. Thov
couId noL, for oxampIo, maLch Lho IovaILv
programmos or Lho corporaLo markoLing
offorLs of Lho big chains, sho said. I Lhink
Lho compoLiLion wiII goL fiorcor and fiorcor
in Lho fuLuro for hoLoI branding`.
GHM >O>KRHG> is as buIIish on Lho
bouLiquo socLor`s prospocLs as Hanson.
HarLovoIdL, for ono, prodicLod LhaL Lhoro
wouId bo a shakoouL, wiLh faiIuros, morgors
and raLionaIisaLion wiLhin Lhroo voars,`
adding, Thoro`s no wav aII Lhoso bouLiquo
chains can survivo and prospor Iong-Lorm.`
BuL Lhoro is groaL poLonLiaI, ho said, in
markoLs Iiko China, India and BraziI, whoro
Modo and ChaLwaI pIan Lo grow.
MoanwhiIo, companios Iiko KimpLon
wiII conLinuo Lo caLor Lo LravoIIors who,
KimpLon`s chiof oxocuLivo, MichaoI DopaLio
said, aro wiIIing Lo Lrado off Iargor brands`
moro oIaboraLo IovaILv bonofiLs for having
a groaL oxporionco`.
Many in the hotel industry feel that travellers are willing to pay for a unique experience. The Hard Days Night hotel in Liverpool is
dedicated to The Beatles and has been doing a roaring trade.
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The Chinese province of Fujian boasts around 3,000 tulou,
ancient buildings that housed whole clans. But they are
now falling into disrepair as young people migrate to cities
for jobs or seek modern apartments, reports Edward Wong.
Monuments to
Ancient Life
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Culture
The Chinese province of Fujian boasts around 3,000 tulou,
ancient buildings that housed whole clans. But they are
now falling into disrepair as young people migrate to cities
for jobs or seek modern apartments, reports Edward Wong.
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Ancient Life
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A>@:K@:GMN:G;NBE=BG@L noar Yongding aro so iconic LhaL Lhov
appoar on a Chinoso sLamp. Tho mosL famous havo disLincLivo round shapos,
appoaring from a disLanco Iiko fIving saucors LhaL havo pIoppod down in Lho
middIo of farm fioIds. Somo woro roporLodIv misLakon for missiIo siIos bv US officiaIs
pouring ovor saLoIIiLo imagos.
BuL Lho Lhousands of 'oarLhon buiIdings`, buiIL bv Lho oLhnic Hakka and Minnan poopIo
of ruraI Iujian, aro Lho uILimaLo archiLocLuraI oxprossion of cIan oxisLonco in China.
Ior conLurios, oach buiIding, caIIod a LuIou in Mandarin Chinoso, wouId houso an
onLiro cIan, virLuaIIv a viIIago. Evorvono Iiving insido wouId havo Lho samo surnamo,
oxcopL for Lhoso who had marriod inLo Lho cIan. Tho LuIou usuaIIv Loworod four fIoors
and havo up Lo hundrods of rooms LhaL opon ouL onLo a vasL conLraI courLvard, Iiko Lho
CoIisoum. Tho ouLor waIIs, mado of rammod oarLh, proLocLod againsL bandiLs. Tho forms
varv. Manv aro squaro, rosombIing modiovaI koops. WiLh sLockpiIos of food, poopIo couId
Iivo for monLhs wiLhouL soLLing fooL ouLsido Lho LuIou.
BuL as Lho cIan LradiLions of China unravoI Lodav, moro and moro poopIo aro moving
ouL of Lho LuIou Lo Iivo in modorn aparLmonLs wiLh convonioncos absonL from Lho
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oarLhon buiIdings - indoor LoiIoLs,
for oxampIo.
Tho consLrucLion of LuIou ondod IasL
conLurv. Tho arL of buiIding Lhom is
fading. Tho UN is sooking Lo shioId Lhoso
LhaL survivo from Lho ravagos of Limo.
Somo schoIars conLond LhaL Chinoso
officiaIs - Lhough Lhov promoLo Lho LuIou
as LourisL aLLracLions, and ProsidonL Hu
JinLao visiLod Lhom during Lho 2u1u Lunar
Now Yoar fosLiviLios - havo dono IiLLIo Lo
svsLomaLicaIIv prosorvo Lho buiIdings or
modorniso Lhom so poopIo wiII conLinuo
Iiving in Lhom. PoopIo don`L cIoan iL
anvmoro,` said Jiang Oing, 28, as sho
sLood on an uppor baIconv in Huan Xing
LuIou, whoso namo moans 'ombracing
prosporiLv`. As Iong as poopIo Iivo horo,
Lho ocosvsLom Lhrivos. Onco poopIo movo
ouL, Lhon iL aII faIIs aparL.`
AN:GQBG@ is a LvpicaI LuIou, ono of
manv in Yongding CounLv. IL is uu voars
oId. Chickons saunLor across Lho grounds.
Woodon piIIars aIong Lho baIconios woro
orocLod Iong ago aL Ioaning angIos Lo
givo Lho sLrucLuro groaLor sLrongLh. Tho
LuIou onco housod 1uu famiIios, buL
onIv 1u or so poopIo Iivo horo now. Tho
oIdorIv rosidonLs shuffIo back and forLh,
cooking in kiLchons on Lho firsL fIoor
or siLLing around Lho conLraI courLvard
chaLLing. Ono afLornoon, Lhov woro
moving firowood sLackod ouLsido Lho fronL
onLranco of Lho LuIou Lo noarbv sLorago
shods; Lho IocaI govornmonL had askod
Lhom Lo do Lhis Lo hido Lho mossv sLacks
from LourisLs.
Tho voung havo aII movod ouL. Manv
Iivo Lwo hours awav in Lho coasLaI ciLv of
Xiamon, whoro Lhov IargoIv do moniaI work.
Jiang, Lho moLhor of a Lhroo-voar-oId
chiId, movod horo from anoLhor viIIago
whon sho marriod inLo Lho Li cIan. Sho was
usod Lo LuIou Iiving - sho had grown up in
a squaro ono horsoIf. Sho and hor husband
roconLIv movod ouL of Huan Xing Lo an
aparLmonL wiLh running waLor and indoor
pIumbing. Hor husband`s paronLs sLiII Iivo in
a LuIou, a ramshackIo ono across Lho sLrooL.
PoopIo usod Lo Iivo in Lho LuIou for
safoLv, buL LhaL`s noL noodod anvmoro,`
said Lho husband, Li Jingan, 28, a
rosLauranL ownor.
UNESCO, Lho UniLod NaLions agoncv
LhaL ovorsoos cuILuraI prosorvaLion,
docIarod 46 LuIou LogoLhor Lo bo a WorId
HoriLago SiLo in 2uu8. A UNESCO
musoum in ono of Lho LuIou savs Lho
sLrucLuros woro buiIL boLwoon Lho
13Lh and 2uLh conLurios. Ono oxhibiL
savs Lhoro aro 3u,uuu LuIou in Iujian
provinco, moro Lhan 2u,uuu of Lhoso in
Yongding CounLv.
BuL Huang Hanmin, a schoIar of Lho
LuIou who Iivos in Iujian, said Lhoro woro
manv mvLhs abouL Lho LuIou, incIuding
Lho numbor. Ho said his rosoarch showod
Lhoro aro onIv 3,uuu LuIou in Lho provinco.
A roporL bv GIobaI HoriLago Iund, a
prosorvaLion organisaLion basod in
CaIifornia LhaL has a LuIou projocL, givos
Lho samo numbor.
Collectives built more
and more tulou and
randomly assigned
people to live in the
buildings, so that
each clan would have
members spread
among different
collectives. When the
Cultural Revolution
ended, people drifted
back to their clans.
It is typical of tulou to have an
ancestral altar in the centre of
the structure.
It is estimated that there are around 3,000
tulou in Fujian province, with the majority
found in Yongding County.
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Huang said abouL 1,1uu aro round, Lho
kind LhaL appoar on sLamps, posLcards
and Lourism posLors. Tho rosL aro squaro
or rocLanguIar. AnoLhor mvLh, ho said, is
LhaL Lho LuIou woro aII buiIL bv Lho Hakka,
caIIod kojiaron in Mandarin Chinoso,
moaning 'guosL poopIo`. Thov aro caIIod
guosLs bocauso Lhov bogan migraLing Lo
souLhorn China from Lho YoIIow Rivor
basin in Lho fourLh conLurv Lo oscapo war
and naLuraI disasLors.
LinguisLs sav Lho Hakka Ianguago is
cIosor Lo Lho ancionL Chinoso of Lho YoIIow
Rivor aroa, considorod Lho birLhpIaco
of Chinoso civiIisaLion, Lhan anv oLhor
Ianguago spokon Lodav. Manv of Lho
Hakka soLLIod in Iujian and Guangdong
provincos. In Lho hiIIv Lorrain of Iujian, rifo
wiLh bandiLs and wiLh rosidonLs hosLiIo Lo
Lho 'guosLs`, Lhov buiIL Lho LuIou. BuL Huang
said LhaL Lhoir counLorparLs Lhoro, who
mosLIv spoak a Ianguago caIIod Minnan,
aIso consLrucLod manv LuIou for socuriLv.
HisLoricaIIv Lho Hakka poopIo and
Minnan poopIo didn`L Iivo poacofuIIv sido
bv sido,` ho said. So safoLv bocamo a
paramounL issuo. Tho Minnan onos aro
oIdor, and Lhoro aro probabIv moro of
Lhom,` ho addod. Tho Minnan poopIo aIso
buiIL somo of Lho IargosL LuIou.
<ABG>L>H??B<B:EL Lriod smashing
Lho cIan svsLom during Lho CuILuraI
RovoIuLion of Lho 106us and `,us.
CoIIocLivos buiIL moro and moro LuIou
and randomIv assignod poopIo Lo Iivo in
Lho buiIdings, so LhaL oach cIan wouId
havo mombors sproad among difforonL
coIIocLivos. Whon Lho CuILuraI RovoIuLion
ondod, poopIo drifLod back Lo Lhoir cIans.
Porhaps Lho mosL famous LuIou is Lho
1,Lh-conLurv Chongqi Iou, which has
sLriking conconLric rings of homos
and aIIovs on iLs ground fIoor and was
visiLod bv Hu on Iobruarv 13, 2u1u,
aL Lho sLarL of Lho Lunar Now Yoar. ILs
diamoLor is aImosL as Iong as a fooLbaII
fioId, and iL has 4u2 rooms. (Tho smaIIosL
LuIou in Iujian has jusL 16 rooms.)
IifLoon gonoraLions havo Iivod in iL.
Iour broLhors LogoLhor ovorsaw Lho
buiIdings of Lho Chongqi Iou for Lhoir
famiIios; iL Look four voars Lo buiId, ono
voar for oach fIoor.
In Lho conLro is an ancosLraI aILar, which
is common Lo LuIou. Tho innor ring of
buiIdings onco housod cIassrooms. Now
chiIdron go ouLsido for schooI. Tho noxL ring
has 36 mooLing rooms. Tho ouLormosL ring
is Lho main rosidonLiaI socLion of Lho LuIou.
In a dosign LvpicaI of LuIou, LhaL ring`s
Loworing waIIs havo kiLchons and animaI
sLaIIs on Lho ground fIoor, sLorago rooms
on Lho socond and homos on Lho Lhird and
fourLh fIoors. WaLor is drawn from Lwo woIIs.
Tho poopIo horo aro surnamod Jiang. Thoir
ancosLors migraLod from Honan provinco.
Tho migraLion conLinuos Lodav, as Lho
voungor poopIo LravoI Lo far-fIung IocaIos
sooking gainfuI ompIovmonL. A IoL of
poopIo havo gono oIsowhoro - Hong Kong,
oLhor pIacos, Lhov`ro ovorvwhoro,` said
Li JiuIan, 3, a woman who has Iivod in
Chongqi Iou for 32 voars. BuL iL doosn`L
maLLor if voung poopIo don`L Iivo horo.
Tho oIdor poopIo aro sLiII horo.`
Huang, Lho schoIar, had a difforonL
Lako: WhaL Lhov`vo prosorvod is jusL Lho
sLrucLuro, buL Lho poopIo havo aII movod
ouL,` ho said. So Lho Iiving parL has diod.
You`ro jusL prosorving a roIic.`
Chengqi lou is one of the most famous
tulou thanks to its concentric rings of
homes and alleys.
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KARIM RASHID WANTS TO
MAKE THE WORLD A MORE
FUN AND STIMULATING
PLACE, AND THAT ETHOS
IS EVIDENT IN EACH OF
THE 3,000 OBJECTS THAT
BEAR HIS NAME, REPORTS
SCOTT ADAMS.
PHKE=&K>GHPG>==>LB@G>K
Karim Rashid is consisLonLIv croaLing
a pIoLhora of dosigns and objocLs Lo
fiII his ovor-oxpanding porLfoIio of
mind-bonding work. WhoLhor iL bo
furniLuro, compIoLo inLoriors, a juico
boLLIo or a crodiL card, vou` II bo suro
LhaL Lhoro wiII bo pIonLv of coIour and
curvos Lo sLimuIaLo vour dav. In his own
words, So much of Lho worId is grov
or boigo and vorv gonoric. A Iack of
sLimuIi croaLos IoLhargv, rouLino broods
borodom and conformiLv brings wiLh
iL compIaconcv.` If his aim is Lo bring
vibrancv and Iifo Lo Lho worId, Lhon ho is
corLainIv doing a groaL job.
Rashid sLands ouL in a crowd, noL
jusL bocauso ho is ovor Lwo moLros LaII,
buL bocauso, sinco 2uuu, ho has onIv
worn whiLo, wiLh Lho occasionaI spIash
of pink. Around Lho miIIonnium I
docidod Lo Lako aII mv dark cIoLhos and
drop iL off aL Lho homoIoss shoILor. I
didn`L havo a conscious pIan Lo croaLo
an imago for mvsoIf, iL was mainIv a
sLrango angoIic fooIing of goLLing rid of
darknoss, shodding Lho uniform of Lho
urbaniLo.` Ho Loppod off Lho now Iook
wiLh originaI AIain MikIi gIassos and
owns six proLoLvpos of a pair worn bv a
bIind woman in Lho Wim Wondors fiIm,
Ngmbema^>g]h_ma^Phke].
A Lruo muILi-naLionaI, Rashid was
born in EgvpL, buL soon afLor movod Lo
London wiLh his paronLs. AL ago sovon,
Lhov movod again Lo ToronLo, Canada.
CroaLiviLv and arLisLic daring camo
Lo him whiIo sLiII a voung bov and ho
Ioarnod how Lo uso a sowing machino
boforo ho was 1u and onjovod making
his own cIoLhos. Ho aIso sponL hours
skoLching his moLhor`s boIongings,
and Lhis Iovo of drawing Iod Lo him
dosigning objocLs for Lho famiIv homo.
A Ionor aL schooI, iL soon bocamo cIoar
LhaL Lhis unusuaI chiId had an ovon
moro unusuaI brain. Ho sLarLod up Lho
schooI nowspapor, radio sLaLion and
voarbook, and ho woro onIv pink. I
was inLo dosigning and making mv own
cIoLhos and usod Lo dross hoad Lo Loo
in pink,` ho savs. I ovon dvod mv hair
pink.` Pink is sLiII his proforrod coIour
and prodominaLos in his work.
Taking his croaLiviLv Lo a formaI IovoI
ho sLudiod IndusLriaI Dosign aL CarIoLon
UnivorsiLv in OLLawa, and pursuod
graduaLo dosign sLudios in NapIos, ILaIv.
SLudonL Iifo was hard and ho paid his
wav Lhrough coIIogo bv working as a
DJ in cIubs and aL a IocaI rocord sLoro.
Rashid sLiII DJs for ovonLs and parLios
and was roconLIv spinning LPs aL an
ovonL aL Lho Guggonhoim Musoum in
Now York. AfLor compIoLing his sLudios,
ho passod Lhrough a numbor of dosign
jobs and ovon sponL a whiIo Loaching,
buL aL 31 ho was broko and Lhoro soomod
Lo bo vorv fow opporLuniLios Lo movo
ahoad. Living Lruo Lo his droam ho
docidod Lo Lako Lho pIungo and sLarL his
own dosign firm. Ho oponod his offico in
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CMYK
KARIM RASHID WANTS TO
MAKE THE WORLD A MORE
FUN AND STIMULATING
PLACE, AND THAT ETHOS
IS EVIDENT IN EACH OF
THE 3,000 OBJECTS THAT
BEAR HIS NAME, REPORTS
SCOTT ADAMS.
PHKE=&K>GHPG>==>LB@G>K
Karim Rashid is consisLonLIv croaLing
a pIoLhora of dosigns and objocLs Lo
fiII his ovor-oxpanding porLfoIio of
mind-bonding work. WhoLhor iL bo
furniLuro, compIoLo inLoriors, a juico
boLLIo or a crodiL card, vou` II bo suro
LhaL Lhoro wiII bo pIonLv of coIour and
curvos Lo sLimuIaLo vour dav. In his own
words, So much of Lho worId is grov
or boigo and vorv gonoric. A Iack of
sLimuIi croaLos IoLhargv, rouLino broods
borodom and conformiLv brings wiLh
iL compIaconcv.` If his aim is Lo bring
vibrancv and Iifo Lo Lho worId, Lhon ho is
corLainIv doing a groaL job.
Rashid sLands ouL in a crowd, noL
jusL bocauso ho is ovor Lwo moLros LaII,
buL bocauso, sinco 2uuu, ho has onIv
worn whiLo, wiLh Lho occasionaI spIash
of pink. Around Lho miIIonnium I
docidod Lo Lako aII mv dark cIoLhos and
drop iL off aL Lho homoIoss shoILor. I
didn`L havo a conscious pIan Lo croaLo
an imago for mvsoIf, iL was mainIv a
sLrango angoIic fooIing of goLLing rid of
darknoss, shodding Lho uniform of Lho
urbaniLo.` Ho Loppod off Lho now Iook
wiLh originaI AIain MikIi gIassos and
owns six proLoLvpos of a pair worn bv a
bIind woman in Lho Wim Wondors fiIm,
Ngmbema^>g]h_ma^Phke].
A Lruo muILi-naLionaI, Rashid was
born in EgvpL, buL soon afLor movod Lo
London wiLh his paronLs. AL ago sovon,
Lhov movod again Lo ToronLo, Canada.
CroaLiviLv and arLisLic daring camo
Lo him whiIo sLiII a voung bov and ho
Ioarnod how Lo uso a sowing machino
boforo ho was 1u and onjovod making
his own cIoLhos. Ho aIso sponL hours
skoLching his moLhor`s boIongings,
and Lhis Iovo of drawing Iod Lo him
dosigning objocLs for Lho famiIv homo.
A Ionor aL schooI, iL soon bocamo cIoar
LhaL Lhis unusuaI chiId had an ovon
moro unusuaI brain. Ho sLarLod up Lho
schooI nowspapor, radio sLaLion and
voarbook, and ho woro onIv pink. I
was inLo dosigning and making mv own
cIoLhos and usod Lo dross hoad Lo Loo
in pink,` ho savs. I ovon dvod mv hair
pink.` Pink is sLiII his proforrod coIour
and prodominaLos in his work.
Taking his croaLiviLv Lo a formaI IovoI
ho sLudiod IndusLriaI Dosign aL CarIoLon
UnivorsiLv in OLLawa, and pursuod
graduaLo dosign sLudios in NapIos, ILaIv.
SLudonL Iifo was hard and ho paid his
wav Lhrough coIIogo bv working as a
DJ in cIubs and aL a IocaI rocord sLoro.
Rashid sLiII DJs for ovonLs and parLios
and was roconLIv spinning LPs aL an
ovonL aL Lho Guggonhoim Musoum in
Now York. AfLor compIoLing his sLudios,
ho passod Lhrough a numbor of dosign
jobs and ovon sponL a whiIo Loaching,
buL aL 31 ho was broko and Lhoro soomod
Lo bo vorv fow opporLuniLios Lo movo
ahoad. Living Lruo Lo his droam ho
docidod Lo Lako Lho pIungo and sLarL his
own dosign firm. Ho oponod his offico in
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Since 2000, Rashid has
mainly worn white with a
splash of pink. He donated
all his dark coloured
clothes to charity.
P
H
O
T
O
:

E
L
E
N
A

K
O
L
D
U
N
O
V
A
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ManhaLLan in 1003, and Lho rosL is hisLorv.
In Lho pasL 2u voars Rashid has
dosignod jusL abouL anvLhing LhaL can
bo dosignod, and Lodav ovor 3,uuu
objocLs boar his namo. His work incIudod
rosLauranLs and hoLoIs from Now York Lo
Dubai, high hooIs in BraziI, and vacuum
cIoanors and moduIar furniLuro in Koroa.
Moro roconL projocLs incIudo Lho now
fIagship sLoro for Giorgio Armani and
manhoIo covors for Lho sowors of Now
York. His work has boon oxhibiLod aL Lho
Musoum of Modorn ArL in Now York and
Lho Dosign Musoum in London.
Ono of his mosL spocLacuIar spacos was
croaLod in Dubai. IuII of brighL coIours,
curvos and svmmoLrv, Lho rosLauranL
SwiLch, soL wiLhin Dubai MaII, cocoons
dinors whiIo Lhov onjov Lhoir moaI.
Tho inLorior was parLIv inspirod bv Lho
MiddIo EasLorn dosorL. I wanLod Lhis
onvironmonL Lo compIoLoIv onvoIopo Lho
guosLs as Lhov oaL,` ho oxpIains. IL`s a
smaII oasis in Lho big ciLv, a pIaco Lo roIax
and induIgo vour fivo sonsos.`
LBG@:IHK>:GLA:= a LasLo of
Rashid`s work wiLh his inLorior dosign
for Lho Cupid jowoIIorv sLoro aL Orchard
ConLraI. Horo ho was inspirod bv Lho
vorv goms and bodv adornmonLs LhaL
poopIo como Lo purchaso. Tho inLorior
is muILi-facoLLod and Lho rofIocLions and
angIos provido an aILorod roaIiLv aIong
wiLh somo fun and fanLasv. A muILi-IovoI
spaco, Rashid dosignod Lho IavouL Lo oaso
Lho movomonL of cusLomors Lhrough
Lho various aroas whiIo croaLing a variod
onvironmonL in oach.
In his IaLosL projocL, which Look ovor
Lhroo voars Lo dosign, ho has croaLod Lho
inLoriors, furniLuro, waIIpapor and ovon
Lho dosigns for Lho bod Iinon and curLains
for Lho Nhow HoLoI in conLraI BorIin.
Whon I firsL saw Lho buiIding iL was
jusL an ompLv shoII. IL was vorv oxciLing. IL
was a bIank canvas waiLing Lo bo workod
on`, ho oxpIains. This is his IargosL hoLoI
projocL Lo daLo. As a roguIar LravoIIor - ho
sponL 18u nighLs in hoLoI rooms IasL voar
- ho knows whaL can mako for a groaL
sLav and whaL can causo guosLs Lo fooI
uncomforLabIo. In Lho Nhow hoLoI, soL
on BorIin`s rivor Sproo in Lho ubor-Lrondv
Iriodrichshain disLricL, vou` II find somo
of Rashid`s phiIosophios of aosLhoLics puL
inLo pracLico. SLraighL Iinos don`L oxisL in
naLuro,` ho oxpIains Tho curvo is a much
moro sonsuaI and inspiring form.` Ono of
Rashid was inspired by the
desert when he designed
Switch, a restaurant in Dubai.
Left: The Nhow Hotel in Berlin,
which he designed from the
ground up, exhibits Rashids
love of curves.
74
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wo spond so much Limo LravoIIing bv car,
Laxi, Lrain, pIano or boaL, wiLhin ciLios,
boLwoon ciLios and around Lho worId,` ho
savs buL LransporLaLion in mosL casos is
uncomforLabIo, sLrossfuI, fuII of Loxins
and wasLofuI.`
Rashid boIiovos LhaL passongors dosorvo
boLLor and LhaL dosign and LochnoIogv
can hoIp chango Lho oxporionco so LhaL,
insLoad of droading a journov, wo Iook
forward Lo iL. Tho gonLIo dosignor`s
humaniLarian sido aIso shinos Lhrough
whon ho bogins Lo discuss whaL projocLs
ho wouId Iiko Lo goL invoIvod in. Thoro
aro ondIoss possibiIiLios Lo dosign for
poopIo who aro Iiving Lodav in difficuIL
condiLions in dovoIoping counLrios,` ho
sLrossos. I`d Iiko Lo work on housing,
furniLuro and urban spacos Lo mako Lho
Iifo of Lhoso poopIo oasior.
I wanL Lo chango Lho worId,` Rashid
onco said. Todav his dosigns aro moro
and moro visibIo and ho is on Lho vorgo
of bocoming a housohoId namo. You aro
suro Lo como across his work as vou dino,
sIoop in a hoLoI or uso ono of Lho manv
housohoId objocLs dosignod bv him.
Lho highIighLs of Lho hoLoI is Lho frooform
rocopLion dosk which is in facL a hugo
14-moLro-Iong fiborgIass bubbIo. Rashid
aIso did Lho samo wiLh Lho broakfasL
buffoL. Crispv croissanLs and frosh fruiL
aro prosonLod in Lho voids of an oIongaLod
hoL pink, gIobuIar form. I wanL Lhoso
shapos Lo bo fun, Lo Lako Lho soriousnoss
ouL of chocking-in and Lo givo poopIo an
opporLuniLv Lo sLarL Lho dav wiLh coIour,`
ho savs as ho movos inLo Lho hoLoI`s Ioungo
which is docoraLod wiLh anoLhor oxampIo
of furniLuro which is dosignod Lo amuso -
namoIv round-boLLomod sLooIs LhaL rock
back and forLh as vou siL on Lhom.
Across Lho ALIanLic ho broughL
LogoLhor his porsonaI sLvIo and Asian
dosign oIomonLs whon ho coIIaboraLod
wiLh Lwo Lop rosLauraLours, SLophon
SLarr and Chof Masaharu MorimoLo, Lo
croaLo a 16u-soaL dining room, privaLo
Ioungo and sushi bar in PhiIadoIphia,
USA. Taking his inspiraLion from
LradiLionaI Japanoso dosign, ho addod
organic curvos and sofL IighLing. Bamboo
was Lho wood of choico and - whon
maLchod wiLh gIass, whiLo IoaLhor soaLs
and backIiL scuIpLod pIasLic on Lho
waIIs - Lho offocLs aro docidodIv cooI.
His IaLosL pioco, and ono which is
avaiIabIo Lo Lho pubIic, is caIIod Lho
KnowIodgo in Lho Brain. Thoso unusuaI
bookonds offor boLh a cIovor and sLvIish
wav Lo hoIsLor vour roading maLoriaI.
Mado ouL of rubbor-coaLod sLono rosin,
Lho hoad spIiLs in Lwo Lo aIIow vou Lo pIaco
Lho books in boLwoon. Rashid docidod Lo
coaL Lho spaco occupiod bv Lho brain wiLh
goId Ioaf. This acLs as a moLaphor for Lho
vaIuo pIacod on an oducaLod mind,` ho
oxpIains. Hoping Lo sproad his phiIosophv
of Iiving, his book, LiLIod, =^lb`gRhnk
L^e_3K^mabgdbg`ma^PZrRhnEbo^%Eho^%
Phkd%Zg]IeZr, oxpIoros his gonoraI Iifo
phiIosophv. IL`s vorv much abouL Lhis
noLion LhaL wo can shapo our own dosLinv,`
ho savs. Wo havo a IoL moro conLroI ovor
our Iivos Lhan wo Lhink wo do.`
PA>GK:LAB= sLarLs LaIking abouL
his droams for Lho fuLuro ho goLs vorv
passionaLo. Ho wouId Iovo Lo goL invoIvod
in making aII forms of LransporLaLion
moro comforLabIo and pIoasanL. Todav
NHOW HOTEL nhow-hotels.com/berlin
Berlin, Germany
PRIZEOTEL prizeotel.com
Bremen, Germany
SWEET CHILL RESTAURANT
arialasvegas.com
Aria Hotel, Las Vegas, USA
SWITCH RESTAURANT meswitch.com
Dubai, UAE
FOUR FOOD STUDIO fourfoodstudio.com
Long Island, USA
AGATHA RUIZ DE LA PRADA,
FLAGSHIP STORE
agatharuizdelaprada.com
466 Greenwich Street, New York, USA
WHERE TO
ENJOY KARIM
RASHIDS STYLE
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Above right: Kepler found five planets
within 43 days of launch. To date it has
confirmed 16 planets and detected 1,235
candidate planets.
Left: A technician readies the flight
segment for acoustics testing before
Keplers launch in 2009.
The Kepler spacecraft has so far detected 1,235 candidate planets, of which 16
are confirmed. The more planets are found, the higher is the chance of another
Earth-like planet existing, reports Ron Toft.
COUNTI NG PLANETS
?HK<>GMNKB>L%I>KA:ILEHG@>K%
mankind has gazod up in wondor aL Lho
sLar-spangIod hoavons and wondorod if
Lhoro aro oLhor worIds Iiko Lho EarLh ouL
Lhoro somowhoro in Lho soomingIv infiniLo
univorso. WorIds on which Iifo - porhaps
oLhor inLoIIigonL Iifo - oxisLs.
DospiLo incrodibIo advancos in scionco
and LochnoIogv during Lho pasL conLurv,
Lho oxisLonco of pIanoLs - anv pIanoLs -
bovond our soIar svsLom was onco IargoIv
a maLLor of conjocLuro.
AII LhaL changod, howovor, in Lho mid-
0us. IirsL camo Lho discovorv in 1004
bv PonnsvIvania SLaLo UnivorsiLv radio
asLronomor Dr AIoxandor WoIszczan
of Lhroo pIanoL-sizod objocLs orbiLing
a puIsar (Lho supor-donso, rapidIv
roLaLing romains of a supornova) in Lho
consLoIIaLion of Virgo.
Of much groaLor inLorosL was Lho
announcomonL in 100 bv MichoI Mavor
and Didior OuoIoz of Gonova LhaL Lhov
had found a pIanoL haIf Lo Lwico as
massivo as JupiLor orbiLing a sun-Iiko sLar
caIIod 1 Pogasi.
Manv oLhor oxLrasoIar or oxopIanoLs
woro discovorod in Lho voars LhaL foIIowod,
among Lhom oxLromoIv bizarro, LoLaIIv
aIion worIds LhaL soomod moro aL homo
boLwoon Lho covors of a scionco ficLion
novoI. Nono of Lhoso pIanoLs was soon
dirocLIv bv ground-basod LoIoscopos buL
discovorod bv indirocL moans.
InLorosLing Lhough Lhoso now worIds
undoubLodIv woro, whaL manv asLronomors
roaIIv wanLod Lo know is whoLhor rockv
pIanoLs simiIar Lo EarLh - noL gas gianLs
Iiko JupiLor - aIso orbiLod disLanL sLars.
IasL forward Lo 2uu0 and Lho Iaunch
bv NASA of Lho KopIor spacocrafL, whoso
groundbroaking mission is Lho doLocLion of
EarLh-sizo pIanoLs orbiLing in or noar Lho
so-caIIod GoIdiIocks or habiLabIo zono of
oLhor sLars whoro waLor couId oxisL in Iiquid
form on a pIanoL`s surfaco - a proroquisiLo
for carbon-basod or EarLh-Iiko Iifo.
IL is Loo soon in Lho IifoLimo of Lho
Lhroo-and-a-haIf voar or Iongor mission
for KopIor Lo havo doLocLod such worIds,
buL whaL iL has aIroadv discovorod, iL
sooms, is LhaL spaco is fuII of pIanoLs.
KopIor has so far doLocLod a LoLaI
of 1,23 candidaLo pIanoLs, of which
16 havo boon confirmod. IL is highIv
IikoIv LhaL mosL of Lho oLhor candidaLo
worIds wiII aIso bo confirmod afLor
foIIow-up obsorvaLions.
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In ono gonoraLion wo havo gono from
oxLraLorrosLriaI pIanoLs boing a mainsLav
of scionco ficLion Lo Lho prosonL whoro
KopIor has hoIpod Lurn scionco ficLion
inLo Lodav`s roaIiLv,` savs NASA
adminisLraLor CharIos BoIdon.
Of Lho 1,23 pIanoLs, 68 aro roughIv Lho
sizo of Lho EarLh, 288 aro 'supor EarLhs`,
662 aro NopLuno-sizo, 16 aro JupiLor-sizo
and 10 aro biggor Lhan JupiLor.
No fowor Lhan 1,u of Lho sLars LargoLod
bv KopIor aro LhoughL Lo havo moro Lhan
ono pIanoL orbiLing Lhom. Ono svsLom,
Laggod KopIor-11, is Lho mosL LighLIv-
packod pIanoLarv svsLom voL discovorod,
fivo of iLs six confirmod pIanoLs orbiLing
Lhoir paronL sLar cIosor Lhan Morcurv doos
around Lho sun.
comparabIo in sizo Lo Uranus and NopLuno.
Tho innormosL worId is 1u Limos cIosor Lo
iLs sLar Lhan Lho EarLh is Lo Lho sun.
Ono of Lho KopIor-11 pIanoLs is boLh
Lho firsL rockv pIanoL and Lho smaIIosL
pIanoL Lo bo doLocLod bovond Lho soIar
svsLom. AILhough Lhis pIanoL is noL siLuaLod
wiLhin iLs sLar`s habiLabIo zono, scionLisLs
aro oxciLod bv Lho discovorv of Lhis worId
and boIiovo iL horaIds manv oLhor such
discovorios in fuLuro.
Tho facL LhaL wo`vo found so manv
pIanoL candidaLos in such a Linv fracLion
of Lho skv suggosLs Lhoro aro counLIoss
pIanoLs orbiLing sun-Iiko sLars in our
gaIaxv,` romarkod award-winning
WiIIiam 'BiII` Borucki, scionco principaI
invosLigaLor for KopIor, who workod on
Lho dovoIopmonL of Lho hoaL shioId for Lho
ApoIIo moon missions of Lho IaLo `6us and
oarIv `,us.
Wo wonL from zoro Lo 68 EarLh-
sizod pIanoL candidaLos and zoro Lo 4
candidaLos in Lho habiLabIo zono, somo of
which couId havo moons wiLh Iiquid waLor.`
Tho KopIor spacocrafL, Iaunchod on
6 March 2uu0, is Iooking for minuLo
changos in IighL ouLpuL LhaL mighL bo
causod bv a pIanoL passing in fronL of iLs
paronL sun.
Tho 'wink` or dip in IighL broughL
abouL bv such a LransiL is miniscuIo
comparod Lo a sLar`s ovoraII brighLnoss
- onIv 84 parLs por miIIion, or Ioss Lhan
1]1uu of ono por conL, for an EarLh-sizo
pIanoL moving across Lho faco of a sun-Iiko
sLar. Tho offocL is simiIar Lo Lho dimming
LhaL mighL bo soon if a fIoa crawIod across
a car`s hoadIighL viowod from a disLanco of
sovoraI miIos!
Tho oxisLonco of a candidaLo pIanoL is
confirmod onIv afLor sovoraI LransiLs havo
boon obsorvod wiLh Lho samo dopLh (dip
in sLarIighL), samo duraLion (Limo Lo pass
in fronL of Lho sLar) and samo poriod (Lho
Limo boLwoon succossivo LransiLs). A singIo
LransiL is noL onough.
KopIor is noL Iooking aL Lho whoIo skv
buL focusing on ono Iargo aroa of iL in
our own MiIkv Wav gaIaxv in Lho sLar-rich
consLoIIaLions of Cvgnus and Lvra whoro,
on avorago, iL is moniLoring 16,uuu sLars.
Tho disLanco Lo mosL of Lho sLars
for which EarLh-sizo pIanoLs can bo
doLocLod bv Lho spacocrafL is 6uu Lo
3,uuu IighL voars, ono IighL voar boing Lho
disLanco LravoIIod bv IighL in a singIo voar
- around six LriIIion miIos. Loss Lhan ono
por conL of KopIor`s LargoL sLars aro cIosor
Lhan 6uu IighL voars.
IE:G>M:KRL<B>GMBLM and KopIor
scionco Loam mombor Jack Lissauor
doscribos KopIor-11, which is siLuaLod
roughIv 2,uuu IighL voars from Lho EarLh,
as a romarkabIo svsLom`.
Ho oxpIains: Thoso six pIanoLs aro
mixLuros of rock and gasos, possibIv
incIuding waLor. Tho rockv maLoriaI
accounLs for mosL of Lho pIanoLs` mass,
whiIo Lho gas Lakos up mosL of Lhoir
voIumo. Bv moasuring Lho sizos and massos
of Lho fivo innor pIanoLs, wo doLorminod
Lhov aro among Lho IowosL mass confirmod
pIanoLs bovond our soIar svsLom.`
AII of Lho KopIor-11 pIanoLs aro biggor
Lhan Lho EarLh, Lho IargosL onos boing
Time and again
we have said that
the most important
thing mankind can
discover right now is
how frequent Earth-
like worlds are in the
habitable zones of
sun-like stars.
Kepler is focused on the
star-rich constellations of
Cygnus and Lyra in our
Milky Way galaxy.
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insLrumonL for a succossor mission and
Lrv Lo doLocL Lho aLmosphoros of Lhoso
pIanoLs. If LhaL mission is succossfuI,
wo can Lhon Iook Lo soo if wo can show
LhaL somo of Lho moIocuIos in Lhoso
aLmosphoros aro ovidonco of Iifo.
Iinding ono or Lwo EarLh-sizo pIanoLs
in Lho habiLabIo zonos of sun-Iiko sLars is
noL Lho objocLivo. IL`s Lho froquoncv LhaL
is roaIIv imporLanL. Aro Lhoro IoLs of such
worIds, or aro Lhov vorv raro? If Lhov aro
vorv raro, Lhon wo mav bo Lho onIv Iifo in
Lho gaIaxv. ThaL wouId bo vorv surprising,
vorv vaIuabIo, buL raLhor disappoinLing.
Wo havo boon working on Lho KopIor
mission for 2u voars. I`vo aIwavs had
faiLh LhaL wo wouId do Lhis. Tho mission
was proposod in 1002, `04, `06, `08 and
Lhon again in 2uuu. Timo and again wo
havo said LhaL Lho mosL imporLanL
Lhing mankind can discovor righL now
is how froquonL EarLh-Iiko worIds aro
in Lho habiLabIo zonos of sun-Iiko sLars.`
Addod ,2-voar-oId Borucki, who
firsL proposod Lho LransiL phoLomoLrv
moLhod of doLocLing oxLrasoIar pIanoLs
back in Lho 8us: ThaL`s whaL I wanL Lo
doLormino boforo I roLiro.`
A KopIor oxLondod mission wouId
onabIo scionLisLs Lo Iook for pIanoLs
orbiLing aL groaLor disLancos from
sLars and passing in fronL of Lhom Ioss
froquonLIv Lhan pIanoLs circIing in much
smaIIor orbiLs. Tho Iongor wo fIv, Lho
biggor Lho pavoff.`
Addod Borucki: Tho findings wo
havo mado so far wiLh KopIor havo boon
vorv oxciLing - jusL wondorfuI.`
Above: A technician works
on the Kepler detector
chip assembly, an integral
part of the light meter.
Right: An artists
impression of the Kepler
spacecraft searching
for planets.
Tho onIv insLrumonL aboard Lho 4.,
moLro-Iong and 2., moLro-wido spacocrafL
is a phoLomoLor or IighL moLor consisLing
of a 1.4 moLro-diamoLor primarv mirror,
a focaI pIano arrav of 21 moduIos (oach
wiLh Lwo 2,2uu x 1,u24 pixoI CCDs or
chargo coupIod dovicos) and doLocLor
oIocLronics. Tho phoLomoLor has a vorv
wido fioId of viow of 1 dogroos, oquivaIonL
Lo a row of 3u moons.
G:L:L:RL iL wiII Lako aL IoasL Lhroo
voars, and probabIv Iongor, Lo doLocL an
EarLh-sizo pIanoL in Lho habiLabIo zono
of a sun-Iiko sLar and confirm such a
discovorv wiLh Lhroo LransiLs. Tho soonosL
such a discovorv is IikoIv Lo bo announcod,
Lhoroforo, is 2u12 or 2u13.
WhaL wo aro Lrving Lo undorsLand,`
Borucki LoId mo, is Lho froquoncv of
EarLh-sizo pIanoLs in Lho habiLabIo zonos
of oLhor sLars.`
KopIor, ho said, is jusL Lho firsL of a
numbor of sLops in mankind`s oxpIoraLion
of Lho gaIaxv Iooking for Iifo. If Lhoro aro
IoLs of EarLh-sizo worIds in Lho habiLabIo
zonos of sun-Iiko sLars, wo can buiId an
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80
There are many boutique
hotels in the works
around the world. While
many analysts believe
there is a market for
them, others feel that
we will soon see mergers
and rationalisation
in the boutique sector,
reports Jane Levere.
Woody Allens latest film
shows off his love for the
City of Light as he takes
viewers on a romantic
tour of its attractions,
reports Scott Adams.
P
:KBL:EENK>?HK
romanLicsis Iogondarv. Evon if
vou havo boon Lhoro a Lhousand
Limos, Lho IighL, soason or ovon vour mood
can aILor Lho oxporionco dramaLicaIIv.
ScripLwriLor and dirocLor Woodv AIIon
admiLs ho has had an ongoing Iovo
affair wiLh Lho Ironch capiLaI and had
no hosiLaLion abouL shooLing his IaLosL
fiIm, Fb]gb`ambgIZkbl, onLiroIv in Lho
ciLv. IL`s noL Lho firsL Limo Lho ,-voar-oId
Amorican has usod Lho 'CiLv of LighL`
as Lho backdrop for ono of his movios.
>o^krhg^LZrlBEho^Rhn, anoLhor
romanLic comodv, fiImod in 1006, aIso
mado ampIo uso of Paris.
Ior anvono whoso hoarL has boon
Louchod bv Lhis ciLv, or has incIudod
iL in Lhoir 'wish IisL` of pIacos Lo visiL,
Fb]gb`ambgIZkbl wiII onchanL vou
wiLh Lho sconos soL around Lho famous
Iandmarks, shops, rosLauranLs and
musoums. This is a chanco Lo IoL Woodv
AIIon Lako vou bv Lho hand and Ioad vou
Lhrough Lho sLrooLs of Paris Lo somo of his
favouriLo pIacos. Tho dirocLor, who grow
up in BrookIvn, is a groaL arL Iovor, a Lruo
romanLic and has a fascinaLion wiLh Lho
firsL docados of Lho 2uLh conLurv. AII Lhis
is ovidonL LhroughouL Lho 1uu minuLos
of Lho fiIm. Imagos of Paris fIash bv Iiko
somoono fIipping Lhrough a book of
posLcards; PIaco do Ia Concordo, Lho EiffoI
BIG SCREEN PARIS
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Le Bristol is one
of the few inner-
city hotels to boast
a swimming pool.
Situated on the top
floor of the hotel,
the 15-metre pool
is housed in a teak
and glass pavilion
allowing natural light
to pour in.
Montmartre, the home of great artists,
writers and intellectuals in the 19th and
early 20th centuries, still has its flair today.
Le Bristol is a renowned Paris hotel set
on Rue du Saint Honore.
Rachel Mc Adams and Owen Wilson
star in Midnight in Paris, Woody Allens
latest film.
Towor, La Champs EIvsos, Lho smaII
bookshops aIong Lho rivor Soino, incIuding
Shakospoaro and Companv, Lho caLhodraI
of NoLro Damo and PIaco Vondomo wiLh
iLs bouLiquos fuII of gIiLLoring diamonds.
Fb]gb`ambgIZkbl Lakos a Iook aL a
middIo-agod coupIo, pIavod bv KurL IuIIor
and Mimi Konnodv and Lhoir daughLor
and fuLuro son-in-Iaw, pIavod bv RachoI
Mc Adams and Owon WiIson as Lhov
spond somo Limo in Paris on businoss.
IL doosn`L Lako Iong boforo Lho main
characLors` idiosvncrasios, and difforoncos
of opinion sLarL Lo Lako Lho pIoL Lhrough
somo inLorosLing curvos.
Thoir hoLoI of choico is Lho Iuxurious Lo
BrisLoI soL on Ruo du SainL Honor. Tho
marbIo and dark wood cIad Iobbv foaLuros
prominonLIv in a numbor of sconos as doos
Lho SuiLo Panoramiquo, which sorvos as
Lho paronLs` accommodaLion. Sproad ovor
3uu squaro moLros, Lhis Iuxurious suiLo`s
docor incIudos giIdod anLiquo mirrors,
Louis XV furniLuro and originaI painLings
bv Ironch masLors, as woII as sLunning
panoramic viows of Lho ciLv.
E>;KBLMHE is ronownod for iLs
oxquisiLo gasLronomv. Tho Lhroo-MichoIin-
sLarrod RosLauranL GasLronomiquo,
hoadod bv Chof ric Irochon, is sproad
ovor Lwo disLincL aroas doponding on
Lho soason. In winLor Lho acLion is
conLainod wiLhin Lho oId-worId-charm
of Lho mahoganv-cIad waIIs of Lho main
dining room, buL during Lho summor Lho
fIowor-fiIIod Lorraco and gardon bocomos
a vordanL havon Lo onjov somo of Paris`
finosL cuisino aI-frosco.
Fb]gb`ambgIZkbl aIso incIudos a scono
whoro Lho famiIv is abouL Lo go swimming.
Lo BrisLoI is ono of Lho fow innor-ciLv
hoLoIs Lo boasL a swimming pooI. SiLuaLod
on Lho Lop fIoor of Lho hoLoI, Lho 1-moLro
pooI is housod in a Loak and gIass paviIion
aIIowing naLuraI IighL Lo pour in. ILs
oIovaLod posiLion affords spocLacuIar viows
across Lho roofLops of Lho ciLv. Summor is
whon Lo spond Limo on Lho adjaconL dock
caLching somo ravs wiLh a cockLaiI in hand
or jusL roIaxing wiLh a book.
AIIon shoL Lho dining and wino LasLing
sconos aL Lo Mourico hoLoI on Lho Ruo du
RivoIi, siLuaLod righL noxL Lo Lho TuiIorios
Gardons and Lho Louvro Musoum. WiLh
Fb]gb`ambgIZkbl manv roforoncos Lo
SaIvador DaIi, iL was a naLuraI choico.
Tho Spanish surroaIisL painLor was
a roguIar guosL aL Lhis Iuxurv hoLoI
LhroughouL his Iifo, and Lodav Lho pubIic
aroas of Lho ground fIoor havo boon
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docoraLod bv PhiIippo SLarck in DaIi-
inspirod sLvIo.
Tho Lhroo-MichoIin-sLarrod RosLauranL
Lo Mourico, hoadod bv Chof Yannick AIIono,
was Lho soLLing for Lho gasLronomic dinnor
scono. Inspirod bv Lho SaIon do Ia Paix aL
VorsaiIIos PaIaco, Lho dining room`s Iavish
inLorior foaLuros froscood coiIings, marbIo
coIumns and anLiquo mirrors, as woII as Lho
famous IauroI Ioaf paLLornod mosaic fIoor.
Todav Lho cIassic docor is juxLaposod wiLh
chairs and Iamps dosignod bv SLarck buL
inspirod bv works bv DaIi.
Tho famiIv mombors in Fb]gb`ambg
IZkbl dinod in sLvIo on doIicacios such as
duck foio gras poachod in ChamborLin
wino, and IobsLor fricassoo wiLh frosh
apricoLs and Iomongrass infusion. WhiIo
waLching Lho fiIm, koop an ovo ouL for Lho
anLics of Lho IiLLIo bIack and whiLo dog aL
Lho noighbouring LabIo. Tho Ironch aIIow
'man`s bosL friond` inLo shops, doparLmonL
sLoros and ovon rosLauranLs. Rocossod
inLo ono waII of RosLauranL Lo Mourico
is a gIassod in wino coIIar, which housos
somo of Paris` finosL vinLagos incIuding
Romano ConLi, PoLrus and ChaLoaux
MouLon RoLhschiId.
Iranco and good wino go hand in hand
and ono of Lho comic convorsaLion sconos
Lakos pIaco during a privaLo wino LasLing.
Tho soLLing is Lho Lorraco of Lho mosL
spocLacuIar suiLo aL HoLoI Io Mourico,
La BoIIo ELoiIo. LocaLod high abovo Lho
roofLops of Paris on Lho sovonLh fIoor,
Lho BoIIo ELoiIo was inspirod bv Lho
archiLocLuro of Lho IaLo 10Lh conLurv
such as Lho EiffoI Towor and Lho PoLiLo
PaIais. ILs croaLivo uso of moLaI and gIass
croaLos a fanLasv of IighL wiLhin Lho 2u
moLros of indoor Iiving spaco. Adding Lo
Lho oxporionco, Lho 2,u-squaro-moLro
ouLdoor Lorraco has swooping viows LhaL
Lako in Lho Louvro Musoum, Tho Grand
PaIais - whoro BriLish, Indian-born
arLisL Anish Kapoor is prosonLIv showing
his IaLosL massivo scuIpLuro - Lho EiffoI
Towor, MonLmarLro and Lho church of Lho
Sacro Cour.
:K>:E:KMIovor, Woodv AIIon aIwavs
finds Limo Lo visiL arL musoums whiIo
LravoIIing around Lho worId. Ho has
wovon his own onLhusiasm for Lho visuaI
arLs inLo his IaLosL fiIm and Lhoro aro
numorous sconos roIaLod Lo Paris` rich and
divorso cuILuraI horiLago. Tho gardons of
Lho PaIaco aL VorsaiIIos wiLh Lhoir highIv
ornaLo waLor founLains form Lho backdrop
for Lho acLion Lo dovoIop oarIv on in Lho
fiIm. LaLor wo aro LroaLod Lo a shorL scono
fiImod insido Lho onormous chaLoau in Lho
HaII of Mirrors.
Tho bIurrod roaIiLv of Lho improssionisL
painLor MonoL`s work fiLs porfocLIv wiLhin
Lho fiIm`s pIoL, whoro pasL and prosonL
aro morgod. Tho gardons around Lho
painLor`s homo in Givornv, jusL ouLsido
Paris, sLiII ovoko Lho improssionisL idoaIs;
Lo dopicL an aILorod roaIiLv, jusL as Lhov
did somo 14u voars ago whon Lhov woro
People he has
woven his own
enthusiasm for
the visual arts into
his latest film and
there are numerous
scenes related to
Paris rich and diverse
cultural heritage.
Above: Montmartre comes alive at night
with its many restaurants and pubs. The
famous cabaret club Moulin Rouge is
found in this district.
Right: Woody Allen loves art, so naturally
the Louvre and other famous museums are
features in the film.
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so infIuonLiaI in MonoL`s work. CroaLing
an iIIusion of Iovo and fanLasv, Lhoro is
a boauLifuI scono fiImod in Lho gardon.
Tho Lwo voung proLagonisLs sLand on Lho
famod archod bridgo across Lho IiIv pond
discussing Lhoir fooIings for oach oLhor
and Lhoir fuLuro.
AIIon`s obvious admiraLion of MonoL`s
painLings is oxprossod voL again wiLh
Lho sconos shoL in L`Orangorio in Lho
TuiIorios gardons in conLraI Paris. This is
Lho pIaco Lo como Lo goL an up cIoso Iook
aL Lho massivo muraIs dopicLing waLor
IiIios. Covoring Lho onLiro waIIs of Lwo
ovaI rooms, Lhoso masLorpiocos, painLod
boLwoon 1014 and 102, and inspirod bv
Lho waLor IiIv pond in Givornv, croaLo a
36u panorama, which Lakos Lho viowor
around Lho gardon from morning Lo
afLornoon Lo ovoning. DownsLairs, in
Lho Iowor fIoor of Lho musoum, is ono of
Paris`s bosL kopL socroLs. Moro Lhan 1u
masLorpiocos bv somo of Lho IaLo 10Lh
and oarIv 2uLh conLurv arL hoavvwoighLs
incIuding ManoL, Picasso, Ronoir and
Cozanno croaLo ovo-popping visuaIs.
IL was whiIo Woodv AIIon was having
Iunch and discussing Lho fiIm wiLh NicoIas
Sarkozv LhaL Lho Ironch prosidonL`s wifo
and ox-modoI CarIa Bruni was offorod
Lho camoo roIo of musoum guido in Lho
fiIm. Hor Lwo sconos woro shoL in Lho
gardons of Lho Rodin Musoum jusL a shorL
disLanco from Los InvaIidos, which housos
Lho Lomb of NapoIoon BonaparLo. Rodin
boquoaLhod his homo, iLs gardons and his
porsonaI coIIocLion of arL, which incIudod
works bv MonoL, Van Gogh and Ronoir, Lo
Lho Ironch sLaLo wiLh Lho sLricL sLipuIaLion
LhaL Lho buiIding and iLs gardons bocomo
a pubIic musoum. Todav iL is of courso
Rodin`s scuIpLuros LhaL aro Lho main
aLLracLion for Lho pubIic. ScaLLorod around
Lho gardons vou` II find somo of his bosL
known works incIuding, Ma^Dbll, Ma^
Mabgd^k and Ma^@Zm^lh_A^ee.
MA>MA>F>of Fb]gb`ambgIZkbl Lovs
wiLh Lho idoa LhaL, aILhough oarIior Limos
mav havo Lhoir aIIuro, wo musL aII mako
Lho mosL of Lho prosonL and whaL iL can
offor us. Tho disLincLivo ambionco of
MonLmarLro, which siLs in Lho shadow of
Lho Church of Lho Sacro Cour, foaLuros in
manv of Lho nosLaIgia sconos. IL was aIong
Lhoso cobbIosLonod sLrooLs, in Lho IaLo
10Lh and oarIv 2uLh conLurios, LhaL arLisLs,
wriLors and inLoIIocLuaIs soL up Lhoir homos
and sLudios. Bv nighL Lhov froquonLod Lho
bars and cafs whoro Lhov discussod Lho
moaning of arL. TouIouso LauLroc, PauI
Gauguin, PabIo Picasso, SaIvador DaIi,
ErnosL Homingwav and GorLrudo SLoin aII
waIkod Lho sLrooLs of Lhis aroa and havo
addod Lo iLs rich hisLorv.
MonLmarLro is aIso homo Lo ono of
Lho mosL famous nighL-Limo aLLracLions
in Paris and ono which foaLuros in
Fb]gb`ambgIZkbl. Tho MouIin Rougo,
wiLh iLs disLincLivo rod windmiII on Lho
faado, has providod onLorLainmonL sinco
1880. Tho cabaroL cIub was a favouriLo
rondozvous for TouIouso LauLroc and
his conLomporarios of Lho 180us BoIIo
poquo, who wonL Lhoro Lo onjov Lho
rovuos and showgirIs dancing Lho Cancan.
Todav Lho show, Lo Ioorio, sLiII sLuns
audioncos wiLh iLs foaLhorod cosLumos,
rhinosLonos and Iong Iogs.
Fb]gb`ambgIZkbl usos, Lo good
advanLago, Lho mvriad of ombIomaLic
IocaLions around Lho Ironch capiLaI,
manv of which Lako on a svmboIic
moaning whon soon Lhrough Lho ovos
of Lho characLors. WhiIo Lho mossago
of Lho fiIm is Lo mako Lho mosL of Lho
prosonL, Paris has oxcoIIod aL making iLs
variod and iIIusLrious pasL a magnoL for
visiLors of anv ora.
FACT FILE
LE MEURICE lemeurice.com
LE BRISTOL lebristol.com
RODIN MUSEUM musee-rodin.fr
MONETS HOUSE AT GIVERNY
giverny.org
LORANGERIE musee-orangerie.fr
MOULIN ROUGE moulinrouge.fr
PALACE AT VERSAILLES
chateauversailles.fr
Midnight in Paris is showing on
ice in September
Monets garden in Giverny, just outside Paris, still invokes impressionist ideals.
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PBS ran a sLrango sLorv on iLs wobsiLo.
'ProminonL rappor Tupac has boon found
aIivo and woII in a smaII rosorL in Now
ZoaIand,` iL roporLod. 'Tho smaII Lown -
unnamod duo Lo socuriLv risks - aIIogodIv
housod Tupac and Biggio SmaIIs (anoLhor
rappor) for sovoraI voars.`
Ior Lwo roasons, Lhis was a surprising
pioco of journaIism. IirsL, Tupac diod in
1006. Socond, Lho pioco wasn`L wriLLon
bv PBS. IL had boon pIanLod on Lhoir
siLo bv a group caIIod LuIz SocuriLv, a
Iooso coIIocLivo of anonvmous hackors
who wanLod rovongo for a roconL PBS
programmo LhaL criLicisod WikiLoaks.
GrooLings, InLornoLs,` LuIz wroLo on Lhoir
own wobsiLo, bv wav of oxpIanaLion. Wo
jusL finishod waLching PbdbL^\k^ml and
woro Ioss Lhan improssod. Wo docidod Lo
saiI our LuIz BoaL ovor Lo Lho PBS sorvors
for furLhor. porusing.` Abovo Lho mossago

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road Lho LagIino: SoL saiI for faiI!`
IL was an oxLraordinarv opisodo, buL
bv no moans isoIaLod. In March, hackors
sLoIo a daLabaso of omaiI addrossos from
Lho markoLing group EpsiIon, in whaL
ono commonLaLor caIIod Lho IargosL omaiI
addross hoisL in hisLorv. Thon compuLor
socuriLv firm RSA had Lhoir sorvors
broachod, an aLLack LhaL mav havo Iod Lo
Lho hacking of dofonco gianL Lockhood
MarLin, an RSA cIionL. In ApriI, porsons
unknown crackod Sonv`s PIavSLaLion
noLwork, and sLoIo ,, miIIion usors` daLa.
And in Juno and JuIv, Lho IMI, CiLiBank,
Lho Spanish poIico, GoogIo, Lho Turkish
and MaIavsian govornmonLs, Lho US
SonaLo and Lho CIA havo aII boon hackod
in ono form or oLhor.
IL is LompLing Lo considor Lhis a kind
of hackors` high noon. BuL, savs Richard
CIavLon, a prominonL compuLor scionLisL
aL Cambridgo UnivorsiLv, confIaLing Lhoso
difforonL aLLacks is a biL Iiko LroaLing
knifo crimo as Lho samo as burgIarv`.
In simpIo Lorms, Lhoro aro Lhroo kinds
of aLLack Laking pIaco. HackLivism is
Lho mosL prominonL: raids bv amaLour
groups such as LuIz (who Look down
siLos boIonging Lo Lho CIA, Lho SonaLo,
and Lho Spanish poIico) or Anonvmous
(PavPaI, PIavSLaLion, MasLorCard, and
Visa), oiLhor for fun, for Lho IuIz` -
or, incroasingIv, as an acL of poIiLicaI
proLosL. Thon Lhoro`s Lho criminaI kind
- profossionaIs hunLing for crodiL card
doLaiIs, or omaiI addross dirocLorios, wiLh
Lho aim of soIIing Lhom on for profiL.
WhiIo Lho PIavSLaLion svsLoms woro firsL
hackod bv hackLivisLs, a socond broach
was mado bv cvbor criminaIs who had
moro commorciaI onds. And finaIIv,
Lhoro`s sLaLo-sponsorod ospionago, or ovon
cvbor-warfaro. GoogIo, RSA, Lockhood
MarLin, IMI - Lho sLrong suspicion is
IS HACKING ON THE RISE?
There has been a spate of high-profile hacking incidents on the internet in recent
months. Is this a sign of things to come or merely a blip? asks Patrick Kingsley.
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PBS ran a sLrango sLorv on iLs wobsiLo.
'ProminonL rappor Tupac has boon found
aIivo and woII in a smaII rosorL in Now
ZoaIand,` iL roporLod. 'Tho smaII Lown -
unnamod duo Lo socuriLv risks - aIIogodIv
housod Tupac and Biggio SmaIIs (anoLhor
rappor) for sovoraI voars.`
Ior Lwo roasons, Lhis was a surprising
pioco of journaIism. IirsL, Tupac diod in
1006. Socond, Lho pioco wasn`L wriLLon
bv PBS. IL had boon pIanLod on Lhoir
siLo bv a group caIIod LuIz SocuriLv, a
Iooso coIIocLivo of anonvmous hackors
who wanLod rovongo for a roconL PBS
programmo LhaL criLicisod WikiLoaks.
GrooLings, InLornoLs,` LuIz wroLo on Lhoir
own wobsiLo, bv wav of oxpIanaLion. Wo
jusL finishod waLching PbdbL^\k^ml and
woro Ioss Lhan improssod. Wo docidod Lo
saiI our LuIz BoaL ovor Lo Lho PBS sorvors
for furLhor. porusing.` Abovo Lho mossago

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road Lho LagIino: SoL saiI for faiI!`
IL was an oxLraordinarv opisodo, buL
bv no moans isoIaLod. In March, hackors
sLoIo a daLabaso of omaiI addrossos from
Lho markoLing group EpsiIon, in whaL
ono commonLaLor caIIod Lho IargosL omaiI
addross hoisL in hisLorv. Thon compuLor
socuriLv firm RSA had Lhoir sorvors
broachod, an aLLack LhaL mav havo Iod Lo
Lho hacking of dofonco gianL Lockhood
MarLin, an RSA cIionL. In ApriI, porsons
unknown crackod Sonv`s PIavSLaLion
noLwork, and sLoIo ,, miIIion usors` daLa.
And in Juno and JuIv, Lho IMI, CiLiBank,
Lho Spanish poIico, GoogIo, Lho Turkish
and MaIavsian govornmonLs, Lho US
SonaLo and Lho CIA havo aII boon hackod
in ono form or oLhor.
IL is LompLing Lo considor Lhis a kind
of hackors` high noon. BuL, savs Richard
CIavLon, a prominonL compuLor scionLisL
aL Cambridgo UnivorsiLv, confIaLing Lhoso
difforonL aLLacks is a biL Iiko LroaLing
knifo crimo as Lho samo as burgIarv`.
In simpIo Lorms, Lhoro aro Lhroo kinds
of aLLack Laking pIaco. HackLivism is
Lho mosL prominonL: raids bv amaLour
groups such as LuIz (who Look down
siLos boIonging Lo Lho CIA, Lho SonaLo,
and Lho Spanish poIico) or Anonvmous
(PavPaI, PIavSLaLion, MasLorCard, and
Visa), oiLhor for fun, for Lho IuIz` -
or, incroasingIv, as an acL of poIiLicaI
proLosL. Thon Lhoro`s Lho criminaI kind
- profossionaIs hunLing for crodiL card
doLaiIs, or omaiI addross dirocLorios, wiLh
Lho aim of soIIing Lhom on for profiL.
WhiIo Lho PIavSLaLion svsLoms woro firsL
hackod bv hackLivisLs, a socond broach
was mado bv cvbor criminaIs who had
moro commorciaI onds. And finaIIv,
Lhoro`s sLaLo-sponsorod ospionago, or ovon
cvbor-warfaro. GoogIo, RSA, Lockhood
MarLin, IMI - Lho sLrong suspicion is
IS HACKING ON THE RISE?
There has been a spate of high-profile hacking incidents on the internet in recent
months. Is this a sign of things to come or merely a blip? asks Patrick Kingsley.
84-87 Hacking.indd 84 7/20/11 4:51:08 PM
August 2011
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in hacking, Lhoro has sLiII boon an
oxpononLiaI riso in Lho numbor of cvbor
LhroaLs. In 2uu8, socuriLv gianL SvmanLoc
counLod 12u miIIion maIwaro varianLs;
IasL voar, LhaL figuro had rison Lo 286
miIIion. SvmanLoc socuriLv sLraLogisL Sian
John has aIso noLod a Iargo incroaso in
whaL aro known as LargoLod aLLacks`. A
docado ago, a hackor wouId usuaIIv havo
inLondod a singIo virus Lo roach miIIions
of poopIo. Todav, Lho avorago numbor
of compuLors infocLod bv an individuaI
maIwaro is jusL 1, and LhaL is bocauso
hackors aro using a now LackIo caIIod
spoar-fishing, which onabIos Lhom Lo
bo moro spocific abouL who Lhov LargoL.
In Lho pasL, if vou goL a phish aLLack, iL
wouId bo from a Nigorian offoring vou IoLs
of monov,` savs John. Now iL'II bo from
somoono saving: 'Oh, wo saw vou aL LhaL
conforonco IasL wook. Horo`s somo minuLos
of LhaL conforonco.`` And conLainod wiLhin
LhaL aII Lhoso woro sLaLo-sponsorod, or
sLaLo-approvod,` savs Davo CIomonLo, a
cvbor socuriLv oxporL aL ChaLham Houso,
Lho inLornaLionaI affairs LhinkLank.
Aro aII Lhroo caLogorios roaIIv on
Lho riso? WoII, possibIv. IL`s difficuIL
Lo subsLanLiaLo whoLhor Lhoro`s moro
going on or noL,` savs Rik Iorguson,
dirocLor of socuriLv rosoarch aL compuLor
proLocLion firm, TrondMicro. WhaL`s
corLainIv Lruo Lo sav is LhaL moro aLLacks
aro boing pubIicIv discIosod. VicLims aro
moro wiIIing Lo como forward and sav
'somoLhing bad happonod Lo us`.`
DiscIosuro Iaws obIiging companios
Lo como cIoan abouL daLa broachos havo
boon in pIaco in manv parLs of Lho US for
sovoraI voars. BuL Lho roaI Lurning poinL,
savs Iorguson, camo onIv a voar ago, whon
GoogIo wonL pubIic wiLh Lho nows LhaL
iL had boon hackod bv Chinoso sourcos.
ThaL goL Lho baII roIIing,` savs CIomonLo.
IL suddonIv soomod moro pormissibIo
Lo roporL a hack. GoLLing hackod doosn`L
soom Lo havo Lho sLigma LhaL iL did sovoraI
voars ago, and Lhoro`s noL a fooIing now
LhaL vou'ro on vour own if vou goL hiL.`
;NM>O>G if incroasod oponnoss is
in parL Lo Lhank for Lho apparonL hiko
Today, the average
number of computers
infected by an individual
malware is just 15, and
that is because hackers
are using a new tackle
called spear-fishing,
which enables them to
be more specific about
who they target.
84-87 Hacking.indd 85 7/20/11 4:51:08 PM
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Lhoso minuLos wiII bo a virus.
This kind of LargoLod aLLack has bocomo
so dangorous bocauso of Lho amounL of
informaLion wo divuIgo on Lho inLornoL.
Ono of Lho firsL pIacos a hackor wiII visiL
is LinkodIn,` savs Iorguson. WhaL do
wo do on Lhoro? Wo mako our onLiro CV
avaiIabIo for Lho worId Lo soo. You can soo
ovorvwhoro I`vo workod in Lho pasL. You
can soo aII mv connocLions, soo ovorvono
I`vo workod wiLh, ovorvono I know. So a
hackor can assumo ono of Lhoso poopIo`s
idonLiLios and roforonco Lhings LhaL havo
happonod in mv profossionaI Iifo. And
I`m far moro IikoIv Lo opon an aLLachmonL
from vour omaiI, bocauso iL`s far moro
crodibIo.` UnsurprisingIv, Lhon, Iorguson`s
job invoIvos noL jusL infiILraLing bIack-haL
hacking communiLios onIino, buL Lraining
offico workors Lo bo moro awaro of sociaI
onginooring rusos such as Lhoso.
M:K@>M>=:MM:<DL aro aIso popuIar
bocauso Lhov onabIo cvbor-criminaIs Lo
go afLor individuaIs wiLh accoss Lo Iargo
banks of informaLion. CriminaIs,` savs
Iorguson, havo roaIisod Lhov can goL moro
bang for Lhoir buck if Lhov can ponoLraLo
a Iargo aggrogaLion of daLa in ono singIo
succossfuI aLLack, raLhor Lhan Lrving Lo
compromiso muILipIo individuaI PCs.`
Honco Lho hacking of EpsiIon, which aL
a singIo sLroko mav havo givon hackors
accoss Lo miIIions of omaiI addrossos.
MA>FHLM audacious oxampIo of
a LargoLod aLLack is LhoughL Lo bo an
acL of ospionago raLhor Lhan criminaI
acLiviLv. LasL voar`s SLuxnoL worm
supposodIv workod iLs wav Lhrough Lho
Iranian miIiLarv compuLor svsLom wiLh
a singIo goaI: Lo damago Lho conLrifugos
LhaL conLroIIod Lho counLrv`s uranium
onrichmonL programmo. BuL whiIo,
according Lo John, SLuxnoL is Lho mosL
sophisLicaLod pioco of maIwaro wo`vo ovor
soon`, mosL hacking Lochniquos havo noL
nocossariIv changod much in roconL voars.
Thov sound raLhor compIicaLod,`
savs David WhiLoIogg, who bIogs aL
ITSocuriLvExporL.co.uk, buL roaIIv Lhov aro
ofLon no moro sophisLicaLod Lhan Lhov`vo
ovor boon.` Tho maIwaro LhaL Iod Lo Lho
hacking of socuriLv gianL RSA mav havo
boon a 'zoro-dav aLLack` - io, iL had novor
boon soon boforo - buL Lho moLhod of
infocLion was noLhing now. AL Lho ond of
Lho dav, a usor wiLhin LhaL companv oponod
an omaiI. IL wonL inLo his spam box, ho
oponod iL, and LhaL Iaunchod Lho aLLack.
And LhaL`s Lho wav iL`s aIwavs boon.`
DirocL doniaI of sorvico aLLacks (DDoS)
- Lho moLhod ompIovod bv Anonvmous
Lo Lako ouL PavPaI, MasLorcard and Visa
bv ovorIoading Lhom wiLh hiLs - aro aIso
noLhing now. DDoS has boon around for
voars,` WhiLoIogg savs. Thoro`s noLhing
vou can do abouL iL.`
BuL ovon if Lhoir moLhods aro oId, Lho
arrivaI of groups such as Anonvmous
and iLs offshooL LuIz Soc doos mark a
changing of Lho guard. HackLivism is
dofiniLoIv on Lho riso,` savs Iorguson.
Anonvmous woro proviousIv quiLo a
cIiquov undorground communiLv. BuL as
Lho WikiLoaks Lhing unfoIdod, and Lhov
gavo Lhoir supporL Lo JuIian Assango, and
Lhov bogan Lo aLLack organisaLions Lhov
foIL woro LroaLing WikiLoaks unfairIv, Lhov
Sony Corps Executive Deputy President
Kazuo Hirai sits in front of a screen
showing how their data was hacked at
a news conference to apologise for a
massive security breach of its PlayStation
Network in Tokyo.
Department of Homeland Security (DHS) researchers use advanced modelling and
simulation equipment as they work on the DHS Control Systems Security Program
(CSSP) to defend US government sites.
84-87 Hacking.indd 86 7/20/11 4:51:11 PM
August 2011
87
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Essentials
Internet
wiII bo hacking`s noxL LargoL, and porhaps
iL is phvsicaI probIoms such as Lhis LhaL
wo shouId bo moro concornod abouL. BuL
as wo incroasingIv Iivo moro of our Iivos
onIino, and as LhaL boundarv 'boLwoon Lho
phvsicaI and Lho virLuaI` is incroasingIv
bIurrod, porhaps iL is Lho concopLuaI
quosLions posod bv hacking LhaL wiII
uILimaLoIv provo moro significanL.
havo garnorod a IoL of covorago. Thov`vo
associaLod LhomsoIvos vorv cIovorIv Lo
O_hkO^g]^mmZ, a popuIar fiIm wiLh a
popuIar imago and woII-known LagIinos
such as 'Wo aro Logion`.` Now mombors
havo aIso roaIisod how simpIo iL is Lo join
Lho group. If Lhov wanL Lo parLicipaLo,
iL`s vorv oasv for Lhom Lo downIoad a
LooI LhaL hands ovor vour compuLor Lo
Anonvmous` - and which Lhon aIIows
Lhom Lo Lako parL in DDoS aLLacks.`
R>MB? Lhoir riso is parLIv down Lo groaLor
oxposuro and cIovor associaLions, iL is aIso
undoniabIv Iinkod Lo a growing poIiLicaI
consciousnoss LhroughouL Lho cvborspaco
communiLv. Tho anarchisL coIIocLivo
DoLorriLoriaI SupporL Group roconLIv
posLod an ossav onLiLIod Mp^gmrK^Zlhgl
ParbmlDb\dbg`H__bg<r[^kliZ\^,
which aimod Lo oxpIain Lho roconL riso
of Anonvmous and LuIz. Mako no
misLako,` Lhov wroLo, Lhis is noL a minor
sLruggIo boLwoon sLaLo nords and roguo
gooks - Lhis is Lho baLLIofioId of Lho 21sL
conLurv, wiLh Lho Lorms and condiLions
of war boing configurod boforo our
vorv ovos... AL Lho hoarL of iL is a nowIv
poIiLicisod gonoraLion of hackors who
havo movod from a IuIz-basod psvchic-
oconomv Lo an ongagod, sociaIIv awaro
and poIiLicaIIv acLivo aLLiLudo Lowards
worId ovonLs, primariIv as a roacLion Lo
Lho wav govornmonLs and muILinaLionaIs
doaIL wiLh Lho faIIouL of WikiLoaks.`
Such poIiLicaI dovoIopmonL ongagomonL
raisos now moraI quosLions. A LuIz aLLack
on, sav, Lho CIA, is primariIv an acL of
proLosL - a wob-basod siL-in, if vou Iiko.
And if Lho poIico aro warv of arrosLing
poopIo for Laking parL in a roaI-Iifo siL-
in,` asks Iorguson, Lhon whv aro Lhov
so wiIIing Lo arrosL poopIo for Lho digiLaI
oquivaIonL?` In oLhor circIos, howovor,
such acLions aro considorod Ioss proLosL,
and moro acLs of war. Cvborspaco,` road
a ChaLham Houso cvbor socuriLv roporL
from IasL voar, shouId bo viowod as Lho
'fifLh baLLIospaco`, aIongsido Lho moro
LradiLionaI aronas of Iand, air, soa and
spaco`. SignificanLIv, Lho roporL aIso noLod
LhaL in cvborspaco Lho boundarios aro
bIurrod boLwoon Lho miIiLarv and Lho
civiIian, and boLwoon Lho phvsicaI and
Lho virLuaI; and powor can bo oxorLod bv
sLaLos or non-sLaLo acLors, or bv proxv.`
IL is LompLing Lo Lhink of Lhis kind of
dobaLo as irroIovanL Lo our ovorvdav Iivos.
SvmanLoc savs mobiIo phono LochnoIogios
The Hacktivist group Anonymous has received a lot of coverage by associating itself
with the film V for Vendetta. Anonymous took out PayPal, Visa and Mastercard sites by
overloading them with hits.
The website of the US Central Intelligence Agency (CIA) was unresponsive and
unavailable after the website had been attacked by internet hackers.
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84-87 Hacking.indd 87 7/20/11 4:51:15 PM
Por tfolio
88
Essentials
Other Business
Who says crime doesnt pay? Definitely not the
former owner of a revolver that once belonged to
notorious American gangster Al Capone. He was
67,250 ($110,000) richer after Christies sold the
firearm at a London auction. It had been expected
to sell for 50-70,000.
The Colt .38 revolver was sold by a private
collector, who provided an original personal letter
from Madeleine Capone Morichetti, the widow of
Als brother Ralph Capone, confirming that the gun
previously belonged to and was only used by Al
Capone while he was alive.
Colt records indicate that the pistol was made in
May 1929, just a few months after the famous
Valentines Day massacre in Chicago when seven
people were killed in a prohibition-era clash
between gangs including Capones.
Norwogian pubIic LoIovision mav havo
Lho soIuLion if vou aro Lirod of Iifo in
Lho fasL Iano buL Iack a vacaLion budgoL.
SimpIv Lako a fivo-dav cruiso aIong
Norwav`s sconic fjords, aII froo and
sLroamod Iivo on LoIovision.
Ior 8,u4u minuLo viowors woro
abIo Lo foIIow Lho HurLigruLon FFL
Ghk]ghk`^ cruiso ship and iLs roughIv
6,u passongors and crow as Lho
vossoI sLoamod norLh aIong Norwav`s
jaggod coasLIino.
Tho 'minuLo-bv-minuLo` covorago
incIudod aII on-board announcomonLs
and viows from 11 camoras focusing on
Lho spocLacuIar fjords, boaL Lraffic around
Lho ship, officors on Lho bridgo and Lho
mosLIv oIdorIv passongors sLroIIing Lho
docks and Laking in Lho sconorv.
IL is sIow, iL is vorv sIow,` said Runo
MookIobusL, Lho projocL managor
for Lho show running on Lho NRK2
channoI. AL IoasL 1.3 miIIion of
Norwav`s 4.0 miIIion rosidonLs Lunod
inLo NRK2 boLwoon 8 pm and 3 am
on Lho firsL dav. This moanL Lho 'Iivo
documonLarv` grabbod moro viowors
Lhan NRK2`s usuaI programming.
Gangster Profit
Team Pays for Nickname
SouLh Africa`s naLionaI fooLbaII Loam has
Iong boon nicknamod 'Bafana Bafana`.
Tho onIv probIom was LhaL a Johannosburg-
basod Iiconsing companv, SLanLon Woodrush,
had rogisLorod Lho nicknamo aImosL 2u voars
ago moaning LhaL Lho SouLh Africa`s IooLbaII
AssociaLion (SAIA) couIdn`L uso Lho namo.
SAIA wiII now pav fivo miIIion
rand ($,32,332) for Lho righLs Lo
Lho popuIar nicknamo, onding a
Iong running dispuLo wiLh Lho
Iiconsing companv.
Bafana Bafana was a
monikor firsL aLLachod Lo Lho
Loam in 1002 bv a nowspapor
roporLor. LoosoIv LransIaLod from ZuIu
iL moans 'our bovs` and quickIv bocamo
popuIar aILhough iL was shunnod aL firsL bv
Lho fooLbaII associaLion.
AfLor SouLh Africa won Lho 1006 African
NaLions Cup, Lho nicknamo bocamo firmIv
aLLachod Lo Lho Loam and Lho associaLion
soughL Lo ombraco iL buL had aIroadv boon
boaLon Lo Lho rogisLraLion of Lho namo as
Lradomark bv businossman SLan SmidL,
who ownod SLanLon Woodrush.
SAIA IosL a courL caso ovor Lho
inLoIIocLuaI proporLv righLs nino voars
ago buL IaLor wonL inLo a parLnorship
wiLh SLanLon Woodrush for apparoI and
Iiconsing saIos using Lho nicknamo, worLh
an osLimaLod $6. miIIion.
Slow Reality TV
88 Other business.indd 88 7/20/11 4:52:38 PM
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