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Morning Business Briefing

Amazon.com eyes drone delivery: ‘It looks like science fiction, but it’s real’ Add to ...

These are stories Report on Business is following Monday, Dec, 2, 2013.

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Meet George Jetson
Here’s my vision of coming home after work five years from now:

The car drops me off at the front door and then parks itself, I relax on the couch and check over the day’s work via Google Glass, I order a book on my smartphone, track the delivery schedule on my smartwatch, and 30 minutes later actually get off the couch to go to the door and meet the delivery drone from Amazon.com.

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(I’ll grant you there may be no point in ordering a physical book because it would be easier just to download the e-book version.)

Jeff Bezos agrees it’s the stuff of science fiction, but he’s working on what Amazon.com calls an “Octocopter,” an unmanned electric propeller-driven drone that delivers your packages.

As The Globe and Mail's Omar El Akkad reports, Amazon.com isn't the first to see a future in drones.

Mr. Bezos unveiled Amazon.com’s latest yesterday on 60 Minutes, the CBS show, sparking, of course, a round of comments and jokes on Twitter.

(“If you think flying on a holiday is hell now, just wait.” “People worried about drone safety should take a ride on I-95.” “Fedex will just lob shipments to you by cannon and hope for the best.”)

Mr. Bezos sees this happening in, say, four of five years. The package would be at the door within half an hour of the online purchase.

Obviously this needs the approval of the Federal Aviation Administration, and, as he puts it, things need to be refined so a passerby doesn’t get whacked in the head by a drone.

These wouldn’t be controlled by people, by the way, but rather guided by GPS. They’d be able to fly within a 10-mile radius of an Amazon.com centre.

The online retailer has posted information about the program – dubbed Prime Air – on its website. Complete with video.

“Putting Prime Air into commercial use will take some number of years as we advance the technology and wait for the necessary FAA rules and regulations,” Amazon.com says.

“It looks like science fiction, but it’s real,” the company added.

“From a technology point of view, we’ll be ready to enter commercial operations as soon as the necessary regulations are in place … One day, Prime Air vehicles will be as normal as seeing mail trucks on the road today.”

Icahn gets seat at table
Carl Icahn is poised to become a force for change at Talisman Energy Inc.

The Canadian oil company said today it struck a deal with Mr. Icahn that paves the way for two new directors this month.

Samuel Merksamer and Jonathan Christodoro are both managing directors at Icahn Capital LP, The Globe and Mail’s Bertrand Marotte reports.

Mr. Icahn, who owns about 7 per cent of Talisman stock, has agreed to “certain standstill restrictions” until either the company’s 2014 annual meeting, or the departure from the board of the two new members, one of whom will sit on the succession committee for the next chief executive officer.

“We look forward to working with the board of directors and management with a common objective of creating sustainable value for all shareholders,” Mr. Icahn said in a statement.

Talisman stock was up 1.6 per cent within about an hour of the Nasdaq open.

Loonie sinks
Think twice before you click “buy” on a U.S. site this cyber Monday.

The Canadian dollar continued to erode today, sinking below the 94-cent mark.

The loonie, as the dollar coin is known in Canada, has been sinking for some time, and analysts have trimmed their projections for the currency’s value, at least in the short term.

This comes as economists expect a more “dovish” Bank of Canada statement after governor Stephen Poloz and his colleagues meet this week.

“Friday’s stronger than expected quarterly GDP print, rising 2.7 per cent annualized, and increasing evidence of an uptick in the global manufacturing cycle have been ignored by CAD traders as the market focuses on the risk surrounding Wednesday’s BoC meeting and the potential for a more dovish turn by Governor Poloz,” said chief currency strategist Camilla Sutton, referring to the loonie by its symbol.

“We do expect the BoC to strike a dovish tone; however it is highly unlikely that they warn of interest rate cuts considering the risks surrounding financial stability (even as the government introduced late last week a new risk fee on CMHC mortgages beginning January 1, 2014).”

Many observers expect the loonie to trade in the 93-cent to 94-cent range, though Goldman Sachs Group Inc. projects an 88-cent level, and is recommending shorting the currency.

Markets mixed
Global markets are mixed, and generally soft, so far this morning as purchasing managers indexes flood in from around the world.

“Equity markets had a slow start to the week, but an unexpectedly soft Spanish manufacturing number reminded traders that the country's problems are far from over,” said market analyst David Madden of IG in London.

“Despite Chinese manufacturing increasing in November, there are still doubts over future growth rates as credit conditions continue to deteriorate. The booming Asian economy is heavily reliant on credit and if the pool starts to run dry we could see a collapse in mining stocks.

The retail sector is in the red despite it being Cyber Monday, the day when online shopping spikes as the countdown to Christmas.”

Tokyo’s Nikkei slipped slightly, while Hong Kong’s Hang Seng gained 0.7 per cent.

In Europe, Germany’s DAX was up 0.1 per cent by about 8:20 a.m. ET, while London’s FTSE 100 and the Paris CAC 40 were down by between 0.2 per cent and 0.7 percent.

Dow Jones industrial average and S&P 500 futures were little changed.

“Seeing as it’s the start of a new month, there were a number of manufacturing PMIs for November released overnight,” said senior economist Benjamin Reitzes of BMO Nesbitt Burns.

“Starting in China, the official manufacturing PMI held steady at 51.4, while the HSBC measure was revised up 0.4 points to 50.8,” he added in a research note.

“The latter is still down 0.1 points, but the size of the upward revision was unexpected. Overall, the figures suggest that China’s economy maintained momentum in Q4, with growth likely holding around 7.5 per cent. Elsewhere, the euro area manufacturing PMI was unexpectedly revised up a tick to 51.6 for November. Much of the strength is still in Germany, but Italy’s index surprisingly picked up to 51.4.”

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