From fission to Pharaoh?
Dec 17th 2009 | CAIRO
From The Economist print edition
Egyptian reformers suggest a possible president
Planting a bomb under Egyptian politics
WHEN Mohamed ElBaradei won the Nobel peace prize in 2005, Egyptians happily proclaimed him a national hero. But now that he has retired after 12 years as head of the International Atomic Energy Agency, the UN’s nuclear watchdog, some are calling him a villain. He may be an American or even an Iranian agent, hint editorials in Egypt’s state-owned press. He bears a nasty grudge against his native country after so long abroad, grumble other government mouthpieces.
The reason for this sudden spate of spurious insinuation? Responding to pleas from reform-minded Egyptians despairing of local politics, Mr ElBaradei has suggested he may return to Egypt and run for president in elections due in 2011. Worse yet, he has deigned to propose conditions for his possible candidacy. The poll, he says, must meet internationally accepted standards.
For so prominent a citizen to toss his hat into the ring would cause scarcely a shrug elsewhere. In Egypt, where five decades under a single party and almost three under its present leader, President Hosni Mubarak, have smothered all but a pretence of democracy, it has raised a big cloud of dust. The notion of Mr ElBaradei’s candidacy brings a frisson of unpredictability to what Egyptians had assumed would be a scripted outcome, giving either a sixth six-year term to Mr Mubarak, now 81, or a win for his son, Gamal, who steers policy in the ruling National Democratic Party (NDP).
More annoyingly for Egypt’s rulers, Mr ElBaradei’s declaration of conditions has cast unwonted light on the crafty constitutional mechanics that allow the stage-managing of Egypt’s supposed democracy. Even to become a legal independent candidate, for instance, Mr ElBaradei would need to collect 250 signatures from a range of “elected” officials, all of whom happen to sit in bodies massively dominated by the NDP.
Perhaps not even Mr ElBaradei himself expects that he may be allowed to become a serious challenger. Yet such is the depth of frustration with Egypt’s stagnant politics and many social ills, particularly among the generation that has known no rule except Mr Mubarak’s, that even this distant hope has stirred passions. Surprisingly, considering that he has spent most of the past 40 years outside Egypt, and rarely pronounced on its troubles, some 21,000 enthusiasts have signed on to a Facebook support group. Perhaps theirs is the voice of Egypt’s future.
An imperfect storm
Nov 13th 2009
From The World in 2010 print edition
By Simon Cox, DELHI
Thanks partly to the monsoon, manufacturing will overtake agriculture for the first time in India
From the village of Vijay Pura in the Indian state of Rajasthan, the global financial crisis seems remote. The downturn is something people here read about in the newspapers, according to Dhanna Singh, a member of the Mazdoor Kisan Shakti Sangathan (MKSS), a union of activists and farmers. The villages have welcomed back migrant workers from neighbouring states, where people no longer find work twisting steel in Mumbai or polishing diamonds in Surat. But, by and large, India’s rural poor were protected from the crisis by the same things that make them poor. If you never had secure employment or many financial assets, you cannot lose them to the crisis.
In Rajasthan, this resilience is also the result of government policy. The National Rural Employment Guarantee Act (NREGA), extended to every rural district in April 2008, is supposed to offer 100 days of work a year, at the minimum wage, to every rural household that needs it. Rajasthan, a parched state with a long history of drought-relief works, comes closer to fulfilling that promise than anywhere else, providing 68 days of work on average in the year to March 2008, according to a survey published in Frontline, an Indian newsweekly. Vijay Pura is cross-hatched with hard-packed roads built by people on the act’s payroll. Thanks to the roll-out of the NREGA and a hike in the minimum wage, “People here are feeling a sense of security for the first time,” says Shankar Singh of the MKSS.
The strength of rural demand is one reason why India escaped from the crisis so lightly. Sales of many “fast-moving” consumer goods, such as shampoo and toothpaste, are now growing faster in the villages than in the cities. Rural India’s purchases of chyawanprash, an ayurvedic paste that eases digestion and bolsters the immune system, outpaced urban India’s by over six percentage points in the second quarter. And Maruti Suzuki, India’s biggest carmaker, more than doubled its sales in rural areas in the year to March 2009.
India’s economy is now on the cusp of an historic transition.
But, having weathered the financial crisis, rural India must now weather the weather. The monsoon rains, which feed India’s unirrigated farmland, have been fickle, inflicting drought on almost half of India’s districts, followed by floods in some areas as the monsoon departed. In a worst-case scenario, India’s agricultural output could shrink by up to 7% in the fiscal year ending in March 2010, according to Citigroup. That would drag India’s GDP growth down to 5.2%, slower than in the thick of the financial crisis.
The drought will raise food prices, adding to inflation. India is already the only big economy where consumer prices are rising faster now than they were before the crisis. The price of pulses rose by 20% in the year to August 28th; the price of sugar by 35% . That will force the Reserve Bank of India to tighten monetary policy. Goldman Sachs expects it to raise rates by as much as three percentage points in 2010. Spending on drought relief will also add to the government’s yawning fiscal deficit, which will exceed 10% of GDP this fiscal year, if the budget gaps of the state governments are included.
The monsoon once decided India’s economic fate. Now it only influences it. Agriculture’s share of India’s national output has dropped from 40% 30 years ago to 17% in 2009. Indeed, India’s economy is now on the cusp of an historic transition. In 2010 agriculture will account for a smaller share of GDP than manufacturing: India’s output of widgets will exceed its output of wheat, rice, cotton and the other fruits of the land. The factory will surpass the farm.
Return to the glory days
That is not just because agriculture is poised to shrink. Manufacturing, which stagnated during the crisis, should recover smartly in 2010. It was already growing by over 7% in July 2009, according to the index of industrial production. Investment in new plant and machinery will get a boost from the return of foreign capital inflows, some $44.1 billion in the year to March 2010 and $52.1 billion the following year, according to Rohini Malkani of Citigroup. About 35-40% of those flows will be foreign direct investment.
India’s historians often hark back to the glory days of manufacturing in the 18th century, when Indian artisans produced calicoes and other fabrics of such appeal that Britain’s spinners, weavers and printers clamoured (successfully) for import bans to protect their livelihoods.
During Britain’s industrial revolution, however, Indian weavers were “thrown back on the soil”. India’s first prime minister, Jawaharlal Nehru, wrote that India’s industrial destiny had been thwarted by imperial economics. In 2010, thanks to a failure of the monsoon and a recovery of the world economy, India’s agriculture will at last give way to its manufacturing prowess.
Dec 17th 2009 | MADRID
From The Economist print edition
How an original business model got Spaniards hooked
IT IS called El Gordo (“the Fatty”) because of the huge amount it pays out: *2.3 billion ($3.3 billion) in this year’s draw, to be held on December 22nd. Yet Spain’s Christmas lottery is notable not just for the vast sums to be won, but also for its clever business model.
我们称它为“大肥彩”（El Gordo (“the Fatty”) ），是因为它将在今年12月22号开出的超级巨额大头彩--23亿欧元（33亿美元）。但是西班牙的圣诞博彩之所以值得一提，不仅仅因为它提供的巨额奖金，还因为它精明的商业运作模式。
Spaniards are not especially big gamblers, with spending per head below the average for the European Union, according to a 2006 study by London Economics, a consultancy. Yet they spend about *12 billion a year on lottery tickets, over 1% of GDP—almost as much as the country spends on research and development. Roughly three-quarters of them participate in the Christmas lottery.
Loterías y Apuestas del Estado, the government agency that runs El Gordo and other lotteries during the year, encourages mass participation by dividing each *200 ticket into décimos, or tenths, which sell for *20. This, in turn, allows players to improve their odds by buying small shares in many tickets, often by forming syndicates with friends and colleagues. The lottery also offers enough smaller prizes in addition to its jackpots to give participants almost a one-in-six chance of winning something.
每年管理“大肥彩”和其他一些乐透的政府机构Loterías y Apuestas del Estado，通过将每张200欧的彩票分割成10小张，每小张售20欧的方式，鼓励国民的广泛参与。这样一来，参与者可以在更多大张彩票中购买数张小额股份，而这一般可通过与朋友同事合购的方式实现。除了头彩，它还设置了很多小额的奖励，使得参与者基本上每抽六次，就可以赢回点东西。
All this has transformed the lottery from a glorified tax on the poor, as it is in most countries, into part of the social fabric. Sharing tickets at Christmas has become a way to reinforce social ties, says Roberto Garvía, a visiting professor at Georgetown University. The practice of forming syndicates, which initially started in the 19th century when lottery tickets became too expensive for working-class folk, has become a tradition among all classes. As one banker says, “I don’t want to be the only idiot who has to turn up to work if the office number wins.” Even the Spanish Civil War did not succeed in shaking the lottery’s grip: each side held its own Christmas draw.
这一切使得博彩业由一种被美化了的向穷人征收的税收（多数国家都是这样的情况），变成了社会生活中的一元素。“在圣诞节和别人凑份子买彩票已经成了强化社会关系的纽带。”乔治敦大学（Georgetown University）的做客教授Roberto Garvía如是说道。凑份子的做法最初起源于19世纪，因为当时的彩票贵得让工人阶层买不起。后来，这个传统就在各个阶层就传下来了。正如某个崽银行职员说的：“我可不像成为那个全办公室人都中奖了，却得继续一个人埋头工作的那个傻蛋儿。”
The biggest winner is the Spanish government, which receives 30% of the revenue from ticket sales, less the running costs. But it need not feel too exploitative, argue Mr Garvía and Mauro Guillén of the Wharton School of Business, who have studied lottery syndicates along with Andrés Santana of the Fundación March: “There is some evidence that at Christmas time, syndicates lure into the lottery the relatively wealthy, which might make it less regressive.”
最大的赢家是西班牙政府，它们从彩票销售收入中可以获得30%的收益，还不包括运营成本。“但是也没必要觉得被剥削了”，沃顿商学院的Mr Garvía和Mauro Guillén解围道。他们曾经和“前进基金会”（Fundación March）的Andrés Santana一起研究过博彩业中凑份子现象这一课题。他们解释道：“数据显示，在圣诞节期间，凑份子的做法会吸引更多相对富有的人购买彩票，这就使得它更像是一个累积税。”
Survival of the quickest
Nov 12th 2009
From The Economist print edition
Frequent crises have made for strong banks and nimble financiers
BRAZILIAN businessmen often say that the country’s recent economic past has strengthened companies, and especially banks. The argument goes like this: you need to be good, or at least inventive, to survive and make money when you have no idea whether inflation next year will be 50% or 500%. Bankers and finance directors have had to be particularly nimble. One example is Souza Cruz (a subsidiary of BAT), Brazil’s largest tobacco company, which in the days of high inflation did no better than break even on its cigarette sales. Its profits came from the interest on the cash it held between being paid by retailers and paying tax fortnightly. Companies used to operating in such unusual circumstances flourished when life became more predictable.
There is some truth to this argument, even though it brushes aside the fact that until the 1990s Brazilian companies did not have to worry about foreign competitors. No big companies went bust in the recent financial crisis, despite losses on foreign-exchange derivatives that the Bank for International Settlements estimates at $25 billion. Moreover, no big banks wobbled, let alone had to be rescued, though there were some mergers.
One reason was that a previous round of bank failures, in 1994, had already cleared out the bad ones. Until then banks made their profits by taking deposits from customers, lending the money to the government overnight and pocketing the difference. With inflation at several hundred per cent a year, many banks’ balance-sheets were hard to decipher. When inflation came down, it became clear that a number of them were insolvent. These folded or merged with other banks, leaving only the stronger ones.
Brazil’s financial system got a further boost from reforms carried out when Arminio Fraga was governor of the central bank from 1999 until the start of 2003 (he is now at Gávea Investimentos, an investment firm). The country’s bank-settlement system now operates in real time, so all banks know their cash positions at any given moment and the central bank has an overall picture of what is happening. Before this system was introduced the central bank often ended up honouring the debts of banks that went bust, creating a dangerous incentive to be careless. Both Mr Fraga and his successor as governor, Henrique Meirelles, have made sure that banks report what is going on in any off-balance-sheet vehicles they have funded. This has helped to keep under control the special investment vehicles, conduits and other mysterious creatures that have caused so much damage in other countries.
巴西金融体系在Arminio Fraga担任央行行长期间（1999至2003年初）进行大刀阔斧改革并获得大幅提升，目前他担任投资公司Gávea Investimentos总裁。巴西的银行结算制度目前以实时方式运作，因此所有银行在任何时刻都能掌握自己的现金状况，而央行则掌控各银行实时情况的总图。这套制度引进之前，央行经常要收拾残局支付破产银行的债务，建立了危险诱因却不自知。Arminio Fraga和下一任行长Henrique Meirelles，确保各银行的报表在他们设立之不列入资产负债的任何平台上继续运转。这些有利于控管曾在其它国家造成严重伤害的特别投资平台、管道和其它神秘工具。
This transparency extends to financial markets too. All fund managers must disclose the net asset value of their funds to Brazil’s Securities and Exchange Commission (CVM) daily, though with a 48-hour delay. At the end of every month funds must disclose what they were holding 90 days ago. Anyone can go to the CVM’s website and look up these numbers. Fund managers may grumble about too much disclosure, but most are happy with the rules. Maria Helena Santana, who chairs the CVM, explains that they make it harder to pull off a scam of the sort run by Bernard Madoff, whose pyramid scheme was hidden behind a veil of secrecy.
此一透明制度亦延伸至金融市场。所有基金经理人每天必须向巴西证券交易委员会（CVM）公开他们手上基金的净资产价值，但有48小时延迟。在每个月底，各檔基金必须公开他们90天以前的持股比例，任何人都可以去CVM的网站查阅这些数字。基金经理人虽然可能因公开太多而牢骚满腹，但大多数经理人都乐于接受法规约束。CVM主席Maria Helena Santana阐述，他们会使Bernard Madoff操作的诈骗手法（藏身在秘密面纱后的树状网）更难抽身。
Created equal 建立公平制度
Equity investors, for their part, have benefited from new rules for publicly traded companies brought in by the São Paulo stock exchange (Bovespa) in 2002. Big Brazilian companies used to be notorious for abusing shareholders with minority stakes. Under current guidelines, it is illegal to issue shares that pay out different amounts to different holders in the event of a takeover. Any disputes between shareholders are judged by the CVM. With these rules in place, foreigners have been happy to buy shares and Brazilian companies that were unable to borrow in capital markets are now able to finance their expansion.
A boom in initial public offerings (IPOs) followed. At its height, in 2007, 80% of the money for IPOs came from foreign investors. This undoubtedly led to some excesses: at one point there were more listed housebuilders in Brazil than in America. But some of the companies that floated will do well. And the message conveyed by the new rules—that better corporate governance allows people to make money by selling bits of their companies on the stock exchange—has been good for the family businesses that make up the bulk of Brazil’s medium-sized firms.
Plenty to Celebrate
Santander Brasil’s recent IPO was a test of whether investors’ appetite for Brazil had returned. It proved to be the world’s largest IPO this year, valuing the bank’s Brazilian subsidiary at more than the whole of Deutsche Bank worldwide. The government is so worried about foreign portfolio investors pushing up the value of the real that it imposed a 2% tax in October to discourage them. IPOs have a wider benefit because companies that want to float all or part of their stock need to get their accounts in order, pay their taxes and make sure their workers are not part of the black economy.
Santander Brasil（土生金银行巴西子公司）最近一次IPO就是外资是否对于巴西恢复信心的测试。这次发行被证实为今年全球最大一笔IPO，使得 Santander银行巴西子公司资产超越了全球Deutsche Bank（德意志银行）的总和。巴西政府非常担心外资持股投资人会让黑奥（巴西币）强劲升值，于是在今年十月征收2%税金以阻挡外资进场。IPOs拥有很大利益，想要流通全部或部分股票的公司需要按顺序建立自己的账户、支付自己的税款，并确保自己的员工不是逃税的黑市经济之一。
All this has brought sophistication and liquidity to Brazil’s financial markets. São Paulo’s futures and options market is one of the five largest in the world by volume traded. Well-developed markets have been good for consumers too. High interest rates, high inflation and dysfunctional courts once made consumer credit rarer than snow. Thanks in part to a series of reforms carried out in Lula’s first term, credit has grown steadily. Loans for bigger items, such as cars and apartments, have become available for the first time, thanks to a new law under which a lender remains the owner of the asset acquired with the loan until the last repayment is made, whereas previously the money would have had to be chased up through the courts.
Lula’s first administration also introduced a new bankruptcy law that is credited with making it slightly easier to salvage something from companies that go under. There was room for improvement: a few years ago a World Bank study found that bankruptcy proceedings in Brazil took an average of ten years and left creditors with just two cents in every dollar owed.
Yet for all this progress, two glaring problems with Brazil’s financial system remain. First, credit is very expensive. Second, only the government will lend for long periods, and not to everyone.
Tax and lend 征税和放款
Brazil has a hybrid retail banking system, with state-controlled and private-sector banks competing directly. It is highly concentrated: Itaú Unibanco, the largest private bank, is among the world’s 15 biggest on several measures and yet has almost no presence outside Brazil. Banco do Brasil, the largest state-controlled bank and one of the world’s oldest financial institutions, vies with it for the title of the country’s biggest bank. All told, credit from state-controlled banks makes up 37.6% of the total and has recently been growing.
巴西拥有一套混合的零售金融制度，由国营银行与民营银行直接竞争。这是高度集中的︰巴西最大的民营银行Itaú Unibanco，从某些标准而言排名全球十五大银行之列，但在巴西以外几乎不存在。最大国营银行和全球最古老的金融机构之一Banco do Brasil（巴西银行），与Itaú Unibanco竞争巴西最大银行头衔。据说，国营银行的融资金额占总金额37.6%，并且最近还在成长。
Despite their different owners, the state-controlled and the private banks seem to be behaving in a remarkably similar way. Aldemir Bendini, the chief executive of Banco do Brasil, talks enthusiastically about international expansion. The bank will soon open five agencies in America to serve Brazilian expatriates. It also wants to help Brazilian multinationals abroad with local-currency financing. Meanwhile it will keep up its role as an instrument of public policy that does the bidding of the federal government, its biggest shareholder, and also look after the 22% of its shareholders who own traded stock. It looks like an incongruous mixture, but it appears to work. Itaú Unibanco too is keen on expansion abroad, but makes so much money at home that it does not seem to be in a rush.
尽管他们的所有人不同，但国营和民营银行在行为表现上却似乎非常相似。Banco do Brasil首席执行长Aldemir Bendini热情地谈论在国际上的扩展业务。该银行不久将在美国开设五家分行，提供给移居国外的巴西人，亦想要以当地货币融资协助在海外的巴西跨国企业。同时将保持身为公共政策执行工具的角色，替最大股东联邦政府进行国际招标作业，并且照顾持有上市交易股票比例22%的一般股东。虽然看起来像是不和谐的混合物，但Banco do Brasil似乎却工作。Itaú Unibanco亦对扩展国外业务有强烈兴趣，但在国内赚了太多钱，好像一点都不匆忙。
In theory, all this should provide plenty of competition, with the two types of bank keeping each other honest and making sure that Brazilians have access to credit. In practice it does not quite work like that. Even though Itaú alone has 25,000 cash points, more than 500 municipalities in Brazil lack even a single bank branch. The two kinds of bank compete most fiercely in the comparatively wealthy south and south-east of the country. Banco do Brasil recently added to the geographical concentration by buying Nossa Caixa, a São Paulo state savings bank, and a large stake in Banco Votorantim, a private-sector bank.
理论上，这一切应该提供大量竞争力，让两种不同类型银行维持彼此诚实并确保巴西民众可以取得融资。实际上，却完全不是那么回事。虽然单就Itaú银行而言就有25,000家分行，但巴西五百多个市镇甚至连一家分行都没有。两家银行在巴西最富裕的南部和东南部激烈竞争，Banco do Brasil最近藉由并购圣保罗州营储蓄银行Nossa Caixa及民营银行Banco Votorantim的大半股份，来增加在地理上的集中性。
The government has raised the limit for foreign participation in Banco do Brasil to 20% to attract more capital, but the state-controlled banks are not as well run as the private-sector ones, so the hoped-for competition has not materialised. The clearest sign of this is spreads—the difference between a bank’s cost of borrowing and lending. The Institute for Industrial Development, a lobby group, calculates that average lending rates are 35% higher than deposit rates, against less than 10% in the other BRIC countries. The bankers’ lobby disputes these figures, but nobody thinks that banks’ spreads are thin.
巴西政府已将外资入股Banco do Brasil的比例限制提高至两成以吸引更多资本，但国营银行并不像民营银行经营完善，因此期盼的竞争一直未具体化。银行扩张业务最明显的征兆──银行存放款成本之间的价差。游说团体「工业发展研究院」计算，巴西平均放款利率较存款比率高出35%，其它金砖国家则不及10%。虽然银行业者的游说团还在争吵这些数字，但没人相信银行的扩张仍嫌不足。
Among the things that make them fatter are a curious tax on bank funding that increases costs, and high reserve requirements which mean that banks must squeeze more revenue from what they are able to lend. Bad-loan provisions are high too, reflecting the fact that consumer credit is concentrated among people who are already stretched. And a lot of credit is subsidised, which pushes up costs for the rest.
Brazil’s banks have many things to recommend them; indeed they seem to exemplify what might happen if regulators elsewhere got their every wish. They are safe and their lending is well-capitalised and profitable. Two-thirds of Brazilian deposits are in local banks, which is unusually high for Latin America and a big change from the past, when anyone who had money kept it out of the country and in dollars. The banks also offer some things that would surprise American or European customers. Many ATMs provide a wide range of financial services, from dispensing cash to providing loans. Even so, for now credit is likely to remain too expensive for the country’s good.
For companies trying to get credit, the problems are much the same. To make up for the absence of a market in long-term debt Brazil created a giant development bank, the BNDES, with a balance-sheet larger than the World Bank’s. This is financed by an impost on labour and lends predominantly to Brazil’s biggest companies—the opposite of what you would expect from a left-leaning country.
Because its large loans to Brazil’s big names carry so little risk, the BNDES is profitable. It also does some more adventurous lending, although trickier credit assessments are farmed out to private banks, which collect a fee for their pains and also assume the risk of loans going bad. The BNDES was useful to Brazil during the recent crisis as a stable source of funding, but its scale as the lender of choice for Brazil’s best credit risks is probably impeding the development of markets in long-term debt, and the way it is funded seems fundamentally unjust.
Still, compared with the bank failures, frauds, market manipulation, volatility, disregard for contracts and near-absence of credit of the past, Brazil’s financial sector has come a long way. Foreign investors have noticed, and have recently started pouring money into the country.
Nov 26th 2009
From The Economist print edition
Oprah Winfrey's brand has many years of life left in it yet
Illustration by Brett Ryder
IT WAS one of the most tear-stained moments in the 24-year history of a show that specialises in tear-stained moments. On November 20th Oprah Winfrey announced that she will end her eponymous show in September 2011, 26 years after it first aired nationwide. She loves her show enough to know when it is time to say goodbye, she told her traumatised audience.
The sound of ululation could be heard from sea to shining sea. For once the pundits sang the same song as “real Americans”—as one of Ms Winfrey’s recent guests, Sarah Palin, likes to call them. They talked breathlessly about Ms Winfrey’s up-from-the-bootstraps achievements—how she came from nothing to amass a fortune of $2.3 billion and how she has viewers in more than 100 countries—and pronounced her retirement the end of an era. The New York Times’s Gail Collins added that she wished politicians, from the 92-year-old Robert Byrd on down, would follow her example and quit while they are ahead.
The only problem with all this commentary is that Ms Winfrey is not quitting. She is ending her relationship with a big network, CBS, in order to devote herself to an ambitious new venture, a cable-television channel to be called the Oprah Winfrey Network, or OWN, which she plans to launch in January 2011 as a joint-venture with Discovery Communications. The world is about to be blessed with more Oprah, rather than less.
This is a tricky transition that raises all sorts of questions about the power of personal brands. Can the star’s brand be separated from the show that has nurtured it for almost a quarter of a century? And can it be used to launch an entire network? Personal brands are easy to damage. Martha Stewart, who was once the nearest equivalent to Ms Winfrey, had started to devalue her brand even before she got into trouble with the law, spreading herself too thin and striking too many deals with retailers. The celebrities who lent their name to Planet Hollywood probably no longer relish being associated with a tacky fast-food chain that has gone bankrupt twice. “The Oprah Winfrey Show” is not just a “delivery channel” that she can close down at will: it has defined its creator for 24 years. By killing off her brand-creating show and diluting her personal contribution across an entire network, she runs the risk of enraging her fans.
But there are good commercial reasons for Ms Winfrey’s decision. The audience for network television has been declining relentlessly as viewers have migrated to cable and the internet. The audience for “The Oprah Winfrey Show” has shrunk from about 14m viewers in 1998 to about 7m today, though it still remains the highest-rated talk show. Ms Winfrey is simply following her audience into a more fragmented media world. Besides, there is nothing to stop Ms Winfrey reviving “The Oprah Winfrey Show”, or something very like it, on her new platform.
Ms Winfrey also has lots of experience at relaunching herself. She reinvented the daytime talk show not once but twice—first by exposing some of her innermost secrets in public (about how she was raped at the age of nine and experimented with drugs in her 20s, for example) and second by taking her show upmarket. While Jerry Springer and his ilk filled their studios with stump-toothed degenerates, Ms Winfrey introduced her book club and encouraged her viewers to improve themselves.
Ms Winfrey is also an experienced brand-stretcher. She has starred in a number of successful films, most notably “The Colour Purple”, for which she was nominated for an Oscar; more importantly, she has launched a succession of Oprah-related products such as her website, Oprah.com and her magazine, O. Each time she succeeded in extending her audience without alienating her most loyal fans: a year after O’s launch in 2000 half its readers were not regular watchers of “The Oprah Winfrey Show”, including many professional women who would never dream of watching television in the afternoon.
Life without Oprah没有奥普拉的生活
The biggest challenge with the cable channel will be to see whether Oprah’s brand can survive independently from the star herself. But again she has experience here. She has produced several films that deal with the classic Oprah-themes of suffering and redemption in which she did not actually appear. But the best evidence that she can make successful programmes without starring in them is her success in launching Phil McGraw. She first encountered him after she said on air that fears of mad-cow disease had put her off hamburgers; he helped her handle a lawsuit from a group of enraged Texas cattlemen. She invited him onto her show several times, and then helped him get his own program. “Dr Phil” is now the second most popular talk-show host after Ms Winfrey herself.
Ms Winfrey has always been a vigilant steward of her brand. Almost from the first she wrested as much control as possible from the suits at CBS—and struck famously savvy deals into the bargain. This entailed not only creating her own company, Harpo, but also her own production studio. She is also notorious for her overbearing perfectionism. Ms Winfrey has steadfastly refused to take her company public, as Ms Stewart did. She has also refused to strike deals with retailers or stick her name on merchandise, as numerous celebrity chefs and athletes have done.
Such vigilance about her brand is hardly a guarantee of success in the volatile and cacophonous media market. Her film version of Toni Morrison’s “Beloved” earned only $23m, less than half what it cost to make. Her earlier tentative venture into the cable market, with Oxygen Media, enjoyed limited success. But Ms Winfrey’s handful of failures are as nothing compared with her successes. Perhaps more than any of her rivals Ms Winfrey understands that it is hard to fail in the media business if you put your faith in people’s appetite for stories of those who pick themselves up from the floor and make something of their lives.