10.03.2006

The Continuing Walmart Black Eye

It's no secret here that I despise WalMart, in any of its incarnations. Two items in the news today regarding this distressing visage that brings home the socio-economic mantra that "we are the society we create".

First item is from Apple. I like Apple. A lot. If you remember, I touted the announcement of the iTV set-top box as the "next" thing, or the Missing Link, or whatever. It is all of those. During Jobs' press conference/circus act, he also introduced the availability of Disney movies through the iTunes music store. Now we find out that there were supposed to be more studios on board at roll-out time.

Now the real story:

Walmart accounts for 40% of all hard copy DVD sales. That's A LOT. It's enough that movie studios don't want to piss off the monster named Wally. They don't even want to poke it with a sharp stick. Walmart demands that they be able to buy the DVDs at $17.00 per unit. When Walmart heard that Apple was going to sign studios to a deal where you could download a new-release movie for $14.95, they pooped down both legs.

This was an egregious affront to the deal that Walmart had with the studios, to buy DVDs at $17.00 a pop. Walmart saw its sales numbers going down and made a few phone calls to studios, telling them that if they were going to give Apple movies for $14.95, then Walmart was hereby demanding that they get to buy the DVDs at the same price, or face the simple fact that Walmart was going to cancel any and all purchase contracts from the studio for DVDs. Of course, this put the fear of God in the studios, because Walmart sells 40% of all DVD copies.

Studio orders go down by 40% in one swell foop.

So the studios make a little call to Steve over at Apple and tell them that they can't come out and play tomorrow after all, and well, we'll have to see if we are going to get on board with the iTunes music store thing.

Steve scratches head. Invitations are already out, the little finger sandwiches are already in the fridge. Somebody tells him that Walmart pissed on the party and he makes a little call over there... Walmart CLAIMS it wasn't really trying to manipulate the whole world economy, but steve sees right through that one. You see, DVDs only represent 2% of Walmart's revenues. They don't care whose party they spoil. The studios need them MUCH more than Walmart needs the studios. That's the way they like it.

Anyway, word has it that Apple and Walmart are in negotiations, and one possible deal that is rumored is one in which Walmart would get a share of iTunes download revenues in exchange for its willingness to sell iTunes digital download coupons.

Can you FREAKING believe that??!!! The corporate arrogance at Walmart is simply astonishing.

So, on to the other story: Today's copy of the New York Times ran an interesting story, one with which we are now familiar, about the way Walmart eats its own offspring like cocktail weenies. One employee strategy to combat this was to look at employee unionization. No problem, Walmart said, AND PROMPTLY CLOSED THE STORE IN QUESTION. No store, no union. Easy as that.

Walmart is famous for trimming, squeezing, and slashing supplier costs relentlessly. While the company would like the world to focus on the benefits derived from its low prices, it's hard to ignore how the nation’s largest private employer often grinds up its hourly workers in the same machine.

There are distressing signs that Walmart may be acting on many of the ideas outlined in an internal document — leaked last year — to rid its payroll of full-time and less-healthy employees who are more expensive for the company to retain. For instance, Steven Greenhouse and Michael Barbaro reported yesterday in The Times that employees at several Florida stores say that managers are barring older employees with back and leg problems from using stools they had sat on for years.

Other employees are complaining of sudden scheduling changes they say are skewed to chase out long-term employees, and wage caps that act as a disincentive for those longer-tenured workers. In a stunning deployment of corporate doublespeak, a memo to store managers describes the wage caps as a way to maintain “internally equitable pay levels.” It is true that if everyone is making the same everyday low wages, a perverse form of equality is established among them.

Walmart is a scourge on the face of this country's economy, and a pock mark on our nation on the international stage.

Poo award for this week.

4 comments:

Reach Upward said...

Speaking of Apple, do you own any of the iPod products? I have been shopping around for MP3 players for my two oldest for Christmas. I thought I'd get real cheap ones, but the more I look at the quality issues and how my kids are likely to use the devices, the more it looks like I should go for one of the new iPod Nanos. They cost a bit more than I was planning to spend, but I don't want to waste less money on something with lousy quality or that lacks important features.

I've read lots of reviews of MP3 players, but nothing beats hearing the direct perspective of an actual owner. So, I was wondering if you could offer me any guidance here.

That One Guy said...

Well, here's the thing, see....

I'm almost embarrassed to say it, but ThatOneWife and I each have one, and two of our oldest kids have one, though not the oldest. I think the Nano is the way to go, because it is flash-based, as opposed to hard-drive based. Our two are hard-drive based, and although we have had no problems with them, I can see how a kid could easily mess it up.

Also, in my opinion, the iPod is just another flash player (albeit a very good one), until you pair it up with iTunes. In that combination, it is far and away the most versatile and effective portable music system out there. You don't have to be a MAC-head to do it either, it works fine on a PC, and is a free download. You can rip every CD you have into the system, then choose what to put on your player on any given day. iTunes is also how you'll get software updates and things for the iPod as well.

Of course Apple wants you to also use the iTunes music store to buy new music, instead of buying CDs.

That's what we do. There are very few CDs I we actually buy anymore. (although I probably have about 300-400) The drawback here is that while you get the album artwork, you DON'T get the complete liner notes. Having been employed in that business, that bugs the crap outta me. I want to know who recorded it, and where, who mastered it, who the engineering assistant was. I want all that info. Maybe Apple will make the entire booklet available. There are rare downlaods where it is available I think, but it's by no means pervasive. Long way to go there.

The other nice thing is that this can be a gift that keeps on giving, if you want it to be: most places like Circuit City, Best Buy, (and apparently soon Walmart), sell the iTunes gift cards in many denominations. We have found that to be a nice stocking stuffer. It's about $9.99 - 12.00 for an album, depending on how many songs are on it. ($.99 per song)

Hope that helps.

That One Guy said...

and also, lest you think I have only one perspective here... ALL my kiddies have MP3 players. We've found that the transfer of music from computer to player is cumbersome, and as a result the other players don't get used as much... they tend to get loaded with a set of music and left that way, because the management is difficult, display screens are small, etc. If you're looking for an easy system to deal with, you can stop looking.

The operating system/human interface is really the iPod's biggest advantage, when paired iTunes. Can't beat it. Apple obviously knows this as well, because their new set-top iTV box will have the same style of interface, right on the tv screen. They have the GUI figured out. Frankly, they've had the upper hand on GUI for about 20 years now.

Reach Upward said...

Thank you so much. That does help. Almost every MP3 review I read compares it with the iPod line, meaning that it's the gold standard. Many say things like, "But it's not as smooth as the iPod Nano," or "It's somewhat less sturdy than the iPod." I just wanted to make sure it was worth going that way.

And thanks for the information about the iTunes gift cards. Although I do not yet have an MP3 player, I do have an iTunes account and I have bought some music there. The iTunes gift cards could be wonderful and easy gift ideas for my kids' grandparents to give for years to come.