10 Dumbest Business Moves of 2011
D'OH!Fed sacrifices small businesses to credit-card profitsNetflix does all it can to self destructBank of America nickels and dimes its way to another disasterHP and the no-good, terrible, truly awful yearRupert Murdoch's self-inflicted hack attackResearch In Motion stalls out, then crashesWhatever happened to Oprah?Sony loses its network connection -- and your personal informationEU fiddles while Rome, Athens and more burnsHank Greenberg goes to court
If you find yourself feeling gloomy, here's a list of things to be grateful you didn't do in the last year. From Netflix and RIM trying to self destruct to HP hiring a CEO it never met to Oprah -- remember her? -- disappearing, a not-so-loving look back at the year.
A year ago the Fed said it would set swipe card fees at $0.12. In June, with no difference in economic conditions, it changed its mind and doubled the fee to $0.239. Just like the big bank and credit card company lobbyists wanted them to.
By charging customers $10 a month to watch movies on DVD or online, Netflix had built a devoted customer base and was a darling of Wall Street. Who needs that? Netflix decided to separate the two options and charge more. Guess what? They lost 800,000 customers and its share price collapsed.
BofA wasn't the only bank that planned to charge customers to access their money, but it was the last to rescind the plan and it took the brunt of the anger. Maybe it was the memory of A) That $137 million fine for defrauding schools hospitals, and government organizations; or B) Not paying any taxes for last two years; or C) Foreclosing on all those houses it doesn’t appear to have valid titles for; or D) All of the above and more.
Where to start? They shuffled CEOs as fast as they could but not fast enough to stop Leo Apotheker from costing the company $12 billion in market cap. The company also killed off it's WebOS-based hardware at a cost of $3.3 billion. Apotheker put HP's $41 billion PC business in play. His replacement, former eBay CEO Meg Whitman, canned that idea before the ink was dry on her contract.
As if it isn't bad enough that his reporters and editors hacked into a murdered girl's phone and deleted messages that might have been clues, that was just the start of the story. Turns out this was just SOP at Newscorp. As a result of the never-ending scandal Rupe had to end his bid for BSkyB, close the best-selling newspaper in the world and be publicly chastised by Parliament. So far there have been nearly 20 arrests and Rupe and his sons were nearly voted off the Newscorp board.
If this was a movie it would be called "RIM: Clueless in Canada." The company that brought us The Crackberry lost 70 percent of its share price in a year because of management's inability to react to anything. There was the world-wide service outage, the release of Playbook -- it's terrible attempt at a tablet computer, and the ongoing failure to release a QNX -- it's "next gen" OS. Circling the RIM, indeed.
In June, the woman who was one of the most influential people in the nation -- if not the world -- ended her broadcast TV show after 25 years in order to start her OWN (Oprah Winfrey Network). Out of sight, out of mind as they say. Despite naming herself CEO, her network has drawn few viewers and her brand is in danger of vanishing.
Sony was hacked so many times this year it was like their firewall had a revolving door. The biggest one was when hackers got millions of customers' personal data from the PlayStation Network, which forced the company to take the network down for weeks. Other attacks also hit the company’s Qriocity streaming video and music service, and SonyPictures.com. Even the attackers commented on how easy it was. Ouch.
The European Union's attempt to stave off economic disaster has resulted in exactly one thing: The world's longest-running committee meeting. There have been 20 or so "critical" Euro summits in the past 18 months about this. The only thing they have produced is the need for another critical summit. With Greece, Portugal and Ireland effectively bankrupt and Italy and Spain teetering on the brink, EU "leaders" can't even agree on where to get lunch.
You might think that after heading AIG, which you and I now own most of thanks to billions of dollars in government bailout, ex-CEO Maurice "Hank" Greenberg would want to lay low. You would be wrong. First our Hank sues a Chinese company called MediaExpress for overstating its income. Yep, he lost money because of assets that weren't worth the price he paid for them. Then he sues the Federal government for $25 billion because bailing out AIG caused meant valuable property was taken from him.