TIME Companies

Google Just Took its First Step Back Into China

The Google logo is reflected in windows
The Google logo is reflected in windows of the company's China head office as the Chinese national flag flies in the wind in Beijing on March 23, 2010. AFP/Getty Images

Chinese developers can now sell their apps as exports in Google's app store

Google is trying to woo mobile developers in China.

The search giant has announced that Chinese app developers will now be able to sell apps to Google Play users in more than 130 other countries. It’s one of Google’s first attempts to engage with the Chinese marketplace since leaving the country in 2010 in following conflicts with the government over national censorship policies.

The Google Play Store is severely restricted in China, so app makers in the country will be selling their wares as exports. It’s no surprise that Google is having second thoughts on leaving the country behind: China has more than 600 million Internet users, and that figure is expected to reach 800 million next year.

This olive branch to developers may be the first step in a more ambitious strategy. Google is reportedly looking to partner with a Chinese phone manufacturer or wireless carrier to launch a full-featured version of the Play store in the country, according to the Wall Street Journal.

TIME

TV-Streaming Startup Aereo Files for Bankruptcy

Supreme Court Rules Aereo Violates Copyrights
Aereo CEO Chet Kanojia holds one of the company's small antenna, May 22, 2014. Lane Turner—The Boston Globe/Getty Images

Move comes nearly five months after the Supreme Court ruled against the company in a copyright spat with TV networks

Aereo, a startup that allowed users to live-stream television shows, on Friday announced that it had filed for bankruptcy, nearly five months after the Supreme Court ruled against the company in a copyright spat with TV networks.

“Chapter 11 will permit Aereo to maximize the value of its business and assets without the extensive cost and distraction of defending drawn out litigation in several courts,” wrote Aereo CEO and founder Chet Kanojia in a blog post on the company’s website. That statement indicated the startup doesn’t intend to fight to keep its service in the market.

Aereo lost a key Supreme Court case in late June, in a 6-3 ruling that found the company’s retransmission of network programming amounted to a “public performance” and therefore must include payments to the broadcast networks, or Aereo would run afoul of copyright laws. After that ruling, Fortune reported that the ruling could have killed off the startup, which had raised nearly $100 million from venture capital firms and Barry Diller’s IAC/Interactive.

Kanojia at times struck a hopeful tone in his blog post, saying he felt the current television experience provided few options and that costs were “unreasonably high and rising.” He said Aereo had intended to provide an alternative to “how they watch local live TV. That’s how Aereo came to live.” Founded in 2012, the company allowed users to stream and even digitally record live broadcast television provided they pay for the service for between $8 to $12 a month, depending on the plan.

The startup faced a legal challenge by the major TV networks, which sued Aereo in federal court in New York, citing copyright infringement and asking the court to close the startup down.

After winning a few lower court decisions, Aereo faced a loss at the Supreme Court in June, a defeat Kanojia said “has proven difficult to overcome.”

This article originally appeared on Fortune.com

TIME Toys

Nintendo Wants to Cash In on the Toy Industry’s New Billion-Dollar Craze

"Toys to life" genre combines virtual play with classic action figures

In Nintendo’s wildly popular fighting game series Super Smash Bros., action figures spring to life so they can pummel each other in multiplayer bouts. When the next installment in the series debuts Friday on the Wii U, that fantasy will actually come close to reality. Along with the new game, Nintendo is launching a line of toy figurines that can actually be transferred into the digital world of Smash Bros. to fight against the game’s rowdy characters.

The new toys, called amiibo, are the latest entrants in the rapidly growing “toys to life” sector, a melding of the physical toys of yesteryear and the software kids now enjoy on their tablets and video game consoles. The idea is to expand the play kids are already enjoying in virtual games into the physical world—and let video game companies generate a tidy profit selling figurines and peripherals in the process.

The concept was first proven a hit by Activision, which launched its Skylanders video game franchise in 2011. In that series, gamers can purchase dozens of different figurines embedded with an electronic chip. When players place the figures on a special peripheral that can scan the chip, the characters are transported into Skylanders‘ virtual world. As the character levels up in the virtual world, so does the figurine. If a kid takes his figure over to a friend’s house to play, it’ll retain the same data from his own game.

“By combining the immersive world of video games with the physical connection that kids have with action figures, it was incredibly powerful,” says John Coyne, Activision’s senior vice president of consumer marketing.

While Activision made toys-to-life games viable, Disney has been able to leverage its massive trove of iconic intellectual property to popularize the genre even more. The company’s Disney Infinity series uses technology like that used by Skylanders to let gamers place their figurine characters into virtual worlds based on hit Disney properties like Brave and Lilo & Stitch. A separate, open-ended mode lets players create their own worlds, populate them with Disney characters and share them online.

“It’s very much about building things in there and kind of telling your own stories,” says John Blackburn, senior vice president and general manager of Disney Infinity.

Experts say these titles have been a hit because they spark kids’ imaginations more than a traditional video game can. “It’s really an extension of what kids want naturally, which is to not really have parameters in how they play,” says Liam Callahan, an analyst at research firm NPD. “It’s about breaking down that barrier.”

Skylanders and Disney Infinity have generated $600 million in software sales and nearly $1 billion in hardware sales in the U.S. between them since the genre was first introduced in 2011, according to NPD. Sales in the sector have risen 22% in the last year. Exactly who’s leading the market is a point of contention—Disney Infinity sold more than any version of Skylanders in 2013, but the latest version of Skylanders outsold Disney’s new Marvel-focused Infinity game in October.

It’s not yet clear how Nintendo will fit into this increasingly competitive space. Skylanders and Disney Infinity perform best on Nintendo consoles, according to NPD, which means Nintendo already has a user base actively interested in toys-to-life games. The strength of Nintendo’s intellectual property is also a selling point, as is the ability to use amiibo in games across different genres on the company’s Wii U system, like Super Smash Bros. and Mario Kart 8. “These characters have tremendous fan bases already,” says Scott Moffitt, Nintendo of America’s executive vice president for sales and marketing.

Whether these titles will become a permanent fixture in gaming remains to be seen. A few years ago, millions of gamers were buying plastic musical instruments to play games like Rock Band and Guitar Hero—now those titles are forgotten in bargain bins. But toys-to-life titles may evolve in more dynamic ways than past gaming fads. A new entrant called Anki Drive, for instance, has melded a mobile game with actual stock cars that players can race on a physical track, directing them with a smartphone and the cars’ built-in AI. The cars saw limited retail exposure in 2013 but will be available at Toys R Us and Target this holiday season.

The Anki Drive game uses AI-enabled stock cars that players can control with their smartphones.

The success of these physical toys in an age when apps dominate our lives shows that the next generation doesn’t want play with only their thumbs — there’s hope yet for the real world. “At the end of the day, it’s still very classic play,” says Chris Byrne, a toy industry analyst at Time to Play Magazine. “The technology has just made the toy box bigger.”

TIME Video Games

Call of Duty Exceeds $10 Billion in Sales

US-LIFESTYLE-GAMES-CALL OF DUTY
Boxes advertising the newest installment to blockbuster video game Call of Duty is displayed in a gamestop store in New York City on Nov. 3, 2014 Jewel Samad—AFP/Getty Images

More than the Transformers, The Hunger Games, Iron Man and The Avengers movie franchises combined

Battle-themed video game Call of Duty has crossed $10 billion in lifetime sales, significantly bolstered by demand for its latest installment Call of Duty: Advanced Warfare earlier this month.

Parent company Activision Publishing confirmed that the latest installment had the biggest launch of any entertainment product this year.

“Advanced Warfare is the biggest entertainment launch of 2014 in terms of revenue, surpassing all movie, music and book launches this year.” said Bobby Kotick, CEO of Activision Blizzard.

Since it was first launched in 2003, the game’s total proceeds have far exceeded combined box office receipts for the hit movie franchises The Hunger Games, Transformers, Iron Man and The Avengers.

Activision has been widely praised for the feat. “It’s hard to find a more successful video game publisher than Activision,” Forbes wrote. IGN UK called the latest release “the most successful departure from what’s expected from a Call of Duty.

Stories in the franchise are typically inspired by historical events. The latest installment is set in 2054 and pits players as soldiers against a new villain played by Academy Award-winning actor Kevin Spacey. This time around, Activision utilized advanced capabilities in new-generation PlayStation 4 and Xbox One consoles.

TIME Autos

Everything You Need to Know About Takata’s Air-Bag Recall

So far, 7.8 million cars have been recalled from 10 manufacturers over explosive airbags

Even the normal deployment of an airbag is a violent event. It is initiated by a controlled explosion inside an inflator setting off a chemical reaction that forms nitrogen gas that rapidly expands the airbag, propelling it toward your head at speeds up to 200 mph, all within 20 to 30 milliseconds. That’s the kind of violence needed to dissipate the energy being created by a car involved in a crash. But this explosion shouldn’t hurl shards of metal toward the driver’s face and neck, which has happened in some cars with airbags designed by Takata, a major safety system supplier to the auto industry. Here’s everything you need to know about the widespread recall:

How severe is this problem?
There have been five fatalities linked to Takata’s airbags and the National Highway Traffic Safety Administration (NHTSA) has already issued a recall of 7.8 million cars from 10 manufacturers that have the suspect airbags installed. All are relatively old cars, from model years 2000 to 2008.

How can I find out if my car is affected?
You can call the NHTSA’s hotline : 1-888-327-4236. Or you can go to its website. You will need your vehicle’s identification number (VIN), which can usually be found on the front left of the dashboard near the window.

Why are the cars being recalled?
The propellant Takata used to set off the airbag’s inflator—ammonium nitrate—apparently becomes unstable in humid climates and degrades. The explosion triggering the airbag becomes less controllable, even fatally so. That’s why the original recall focused on cars operating in humid areas of the country including Florida, Puerto Rico, and parts of Texas, Alabama, Mississippi, Georgia, and Louisiana near the Gulf of Mexico. But now the Department of Transportation and NHTSA have called on Takata to issue a national recall for all cars that have the suspect airbag inflators. NHTSA has also demanded more information from Takata about whether and when it knew about the design and manufacturing flaws, with a due date of Dec. 5. The company said it will comply.

Are these the only dangerous airbags?
Three companies supply most of the world’s airbags; Takata, TRW and Autoliv. Only Takata’s airbags are in question, though, because only Takata used ammonium nitrate as a propellant (and it no longer does).

Why did they use ammonium nitrate in their airbags?
Ammonium nitrate provides more bang in a smaller volume than other propellants, which allows the company to offer a more compact device to manufacturers. That’s a potential competitive advantage. In a story in the New York Times outlining Takata’s switch to ammonium nitrate in 2000, the company denied using ammonium nitrate to save costs.

What is Congress doing about the recalls?
At a hearing in Washington D.C. on Thursday, Takata officials were eviscerated by members of the Senate Commerce, Science, and Transportation Committee over the faulty airbags and the company’s failure to notify NHTSA about them. Sen. Bill Nelson of Florida demanded that automakers provide loaner cars or rentals to consumers who were waiting to get replacement airbags in their own cars “by virtue of the fear that has already gripped the public,” he said. Honda is already doing that.

Nelson also displayed a large photo of the damage done to the face of one woman, former Air Force Lt. Stephanie Erdman. She was severely injured in one eye by the flying shrapnel produced by an exploding Takata airbag after the 2002 Honda Civic she was driving was involved in a fender bender. “What happened to me was gruesome,” she testified, and called out Honda for allowing her to drive a defective car. “They did nothing to warn me,” she said.

Does Takata acknowledge its responsibility for injuries and deaths?
That’s exactly what Nevada Sen. Dean Heller asked during the Senate hearing. But Takata executives were both evasive and tongue-tied by language issues. Takata’s Hiroshi Shimizu, senior vice president for global quality assurance said via an interpreter that the company recognized three victims’ cases were linked to the Takata airbags but said two others were being investigated. So let’s take the three, said Heller. Does Takata take full responsibility for those three deaths? “My understanding is our products in these accidents worked abnormally,” said Shimizu, before stipulating, “From that sense, yes.”

Do regulators also deserve some blame?
The Senate committee member faulted the NHTSA for not being able to stay ahead of defects. Heller, a car enthusiast, chafed about the length of time the agency waits from when a defect is found and until a recall is ordered. “NHTSA is not recognizing the defects fast enough, he said. To help the agency speed up a bit, Heller and several other members of the committee are proposing a Motor Vehicle Safety Whistleblower Act that would encourage auto industry employees to identify defects to NHTSA with the prospect of collecting a share of any fines of more than $1 million.

MONEY consumer psychology

Why JetBlue Can Break Your Heart, but Comcast Never Will

JetBlue Planes
Seth Wenig—AP

It hurts to find out that brands like JetBlue want you to love them—but they only love you for your money.

This week, JetBlue announced it’s adding more seats on planes and new fees for checked baggage. The moves are clearly aimed at hiking profits—which is what businesses are supposed to do, right?

So why, then, has JetBlue’s policy change been met with outrage and a sense of betrayal? Isn’t JetBlue just a business that’s, you know, in the business of making money? Shouldn’t we fully expect these kind of profit-first policies? And if this kind of behavior is to be expected, why would there ever be any sense of surprise or disappointment, let alone heartbreak?

The subject brings to mind the old fable “The Farmer and the Viper,” in which a farmer nurses a freezing snake back to health—and is then promptly bitten and killed by the snake as soon as it has the opportunity. The moral is that you shouldn’t be surprised, and you certainly shouldn’t feel betrayed, when a snake behaves like a snake. A similar takeaway comes from the disturbing 2005 documentary “Grizzly Man,” which tells the tale of a man and his girlfriend who were killed, in essence, because a bear behaved like a bear.

The complication is that consumers don’t necessarily view brands that we interact with regularly as animals that will take advantage of us whenever the opportunity arises. We’re encouraged to “like” brands on Facebook, and marketers spend billions to try to get us to love brands, ideally with a cult-like fervor. We tend to view favorite brands as trusted partners or even friends, and we can feel violated and betrayed to the core when the terms of what can be a very warm partnership are exposed as more “strictly business,” to quote The Godfather.

“Some brands are so good at connecting with consumers on an emotional level that the relationship feels incredibly personal, much like a friendship,” explains Kit Yarrow, consumer psychologist and TIME and MONEY contributor. “In most cases the consumers feel they share the same values as the brand, which they see as manifesting human characteristics.”

This certainly seems the case for JetBlue and its longtime customers. The brand resonated and indeed became beloved because of the perks (free TVs and snacks for everyone) and amenities (leather seats and plenty of legroom all around) as much as because of its overriding ethos that all customers were valued—and valued equally. What helped make JetBlue stand out and become an industry darling is that its competitors in the airline business are notorious for exceptionally poor customer service, especially in regards to passengers who are paying the least for their flights.

Slowly, though, JetBlue tweaked its business model—adding a business class and adding more fees recently—and with this week’s announcement about shrinking legroom and the addition of baggage fees, it’s clear that the values originally embraced by the brand have changed as well. For the people who loved and were loyal to JetBlue specifically because of its egalitarian, customers-first approach, the latest moves serve as a big slap in the face with the cold-hearted reality that shouldn’t really come as a surprise, but hurts nonetheless: Brands like JetBlue want you to love them, but they only love you for your money.

Experts who study marketing and company-consumer relationships believe that brands that have developed cult-like followings for supposedly doing things the right and honorable way—Chipotle and Whole Foods come to mind—are likely to feel greater backlash if and when they appear to violate customers’ trust. “Our theory is that the people who feel most betrayed are the ones who were most attached to the brand in the first place,” says Debbie MacInnis, a marketing professor at the USC Marshall School of Business who is researching brand betrayal with colleagues.

By and large, consumers tend to get most attached to scrappy smaller brands with a streak of independence—brands they can identify with and feel good about supporting. “We love underdog stories,” says MacInnis. “We see ourselves as underdogs. We love the little guy, so there’s a natural brand connection.” It’s a connection that goes beyond a mere mutually beneficial economic transaction.

On the other hand, brands that are monolithic and fail to develop long-lasting loyalty or affection—big banks, pay TV and wireless providers, and yes, airlines come to mind—are less at risk of betraying customers’ trust because there was little to no trust to begin with. “You’re not likely to feel betrayed when a cable company treats you poorly,” says MacInnis. “You’ll shake it off and jump” to a competitor without blinking (assuming another one is actually available). “The transgressions are par for the course.”

It’s all about expectations: When someone we thought of as a friend turns out to be just another snake, it’s heartbreaking. Hence, the presence of several “Et Tu, JetBlue?” headlines out there, indicating that the once beloved airline’s betrayal is one of epic proportions.

“When consumers sense they’ve been used or manipulated they feel a burn more similar to a human betrayal than simple transactional disappointment,” says Yarrow. However, bigger, widely bashed brands are “lucky” enough to disappoint customers so frequently that there’s no surprise or sense of betrayal when they make yet another profit-first, customer-unfriendly move. “Consumers have such low expectations of Comcast, for example, they are thrilled when there simply aren’t problems.”

TIME Parenting

5 Million Strollers Recalled After Fingertip Amputations

The company received 11 reports of fingertip amputation, partial-fingertip amputation and finger laceration on faulty hinges

Graco is recalling almost 5 million strollers after complaints that children’s fingers were at risk of being amputated.

A hinge on the side of the stroller can pinch a baby’s finger, according to federal officials; Graco received 11 reports of fingertip amputation, partial-fingertip amputation and finger laceration.

The company is reaching out to parents to contact it for a free repair kit to be shipped next month that includes hinge covers. In the meantime, the company advised parents to exercise caution:

“While waiting for a repair kit, caregivers should exercise extreme care when unfolding the stroller to be certain that the hinges are firmly locked before placing a child in the stroller. Caregivers are advised to immediately remove the child from a stroller that begins to fold to keep their fingers from the side hinge area.”

TIME Food

Holiday Ham May Be Pricier Than Ever

A deadly virus killed millions of piglets.

Ham might take a bigger cut out of your budget this holiday season.

Prices have soared to a record high this fall ahead of the holidays—when half of total ham consumption occurs—after a devastating virus shrank the number of hogs slaughtered this year by more than five percent, Bloomberg reports.

The price has been pushed up further because farmers have fed their hogs more to fatten them up and make up for losses caused by the virus; while fatter pigs mean more meat, their hind legs can grow too large for the seven-pound spiral-cut, half hams popular during the holidays.

Read more at Bloomberg

TIME Retail

Amazon’s Massive Holiday Sales Start a Week Before Black Friday

An employee seals a box at the Amazon.com Inc. fulfillment center in Phoenix, Arizona on Dec. 2, 2013.
An employee seals a box at the Amazon.com Inc. fulfillment center in Phoenix, Arizona on Dec. 2, 2013. Bloomberg/Getty Images

The online super retailer is sliding ahead of the competition

Amazon is beginning its deals for this year’s Thanksgiving shopping blowout earlier than ever, using its online platform to get ahead of competing retailers.

Amazon.com will begin offering deals on Friday, Nov. 21, one full week before the traditional Black Friday, the company announced Thursday. It will add new deals as often as every ten minutes for eight days.

Some deals Amazon is already offering include up to 45% off on some Samsung TVs, as well as nearly half off on many popular books. A full list of Amazon’s deals can be found here.

Among Amazon’s advantages this holiday shopping season is that as an online retailer, it can avoid making customers uneasy by opening stores on Thanksgiving, a practice many brick-and-mortar stores have begun employing. Amazon is also getting a head start on competitors by beginning deals earlier in the month and not waiting until Cyber Monday, a digital deals day that traditionally takes place on the Monday following Black Friday.

“If you’re Amazon, you don’t want to just be batting in the second slot on Cyber Monday,” said Colin Gillis, an analyst at BGC Financial. “There’s been some pushback as Black Friday pushes into Thanksgiving, disturbing the holiday period, so its a window of opportunity for Amazon.”

 

TIME The Brief

#TheBrief: The Air Bag Recall That’s Affecting Millions of Cars

Exploding air bags made by Takata Corporation

Exploding air bags have led to one of the biggest auto recalls in history, one that’s five times larger than GM’s ignition-switch fiasco. How did this happen?

Several large automakers including BMW and Honda have used the air bags, made by Japanese company Takata Corporation, the largest supplier of air bags parts in the world. Now they have had to recall millions of cars after the defective driver’s-side air bags have been blamed for at least five deaths and more than 100 injuries in the past decade.

Watch #TheBrief to find out more about the recall.

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