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Getting real: How TV stars are earning more One of the reasons behind the wild success of reality TV is that it's cheap to pull off compared to traditional series. It can cost just $200,000 (U.S.) for a 30-minute show, The New York Times notes today, compared to more than $1-million for scripted, 60-minute episodes. That's at least partly because there aren't large salaries and big celebrities. Or there weren't, anyway.
Meet Snooki, the very tanned, big-haired, pint-sized doyenne of Jersey Shore, and her friends on the hit show that resumes Thursday on MTV. In Seaside Heights last season, the cast earned just $25,000 as a group for the entire run. In Miami this season, Nicole 'Snooki' Polizzi and company will reportedly share in that amount for each show after demanding more, the newspaper said.
As reality TV stars are rising on series like Jersey Shore and Real Housewives, The New York Times asks, are the shows becoming victims of their own success? The newspaper says TV executives say they're not, but they are on guard. Citing The Hills, the report noted that by the end of its six-season run, its previously unknown stars were earning six figures.
"In scripted, as a producer, you have the ability to write a character out. But in reality, your talent often is the show, so they have a greater ability to use nonperformance as a lever to extract a better deal," Michael Hirschorn, who runs production company Ish Entertainment, told the newspaper.
Ringing the bell Just to drive home that point, Ms. Polizzi and some of her colleagues, including Mike 'The Situation' Sorrentino, got to ring the bell at the New York Stock Exchange to open trading this morning. "It was like a car crash here this morning; people couldn't help but stare," Benedict Willis, director of floor operations at Sunrise Securities Corp., told Reuters, which noted the screams for Ms. Polizzi. "It was very crowded, but most of the crowd were summer interns. It was like P.T. Barnum's freak show was in town."
Last season's finale on MTV, owned by Viacom Inc. , drew an audience of 4.8 million.
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GM prices Volt General Motors Co. said today it will begin pricing its battery-powered Chevrolet Volt at $41,000 (U.S.), above that of the electric Nissan Leaf, which starts at $33,000. The vehicle, eligible for a U.S. tax credit worth $7,500, will begin selling in November. It runs for up to 40 miles on a battery, then a gasoline engine generates electricity that can keep it going for a further 300 miles. Marketing chief Joel Ewanick said the new vehicle is "starting the world on a different path."
BP posts hefty loss, names new CEO Robert Dudley put it bluntly today: "I do not underestimate the nature of the task ahead." Mr. Dudley's comments came as BP PLC , the energy giant at the heart of the disastrous oil spill in the Gulf of Mexico, posted a massive loss, announced tens of billions in planned asset sales and set aside more than $30-billion to cover the costs of its troubles.
As expected, BP today put a Yankee into King Arthur's court, naming Mr. Dudley as its first non-British CEO to replace Tony Hayward. Mr. Hayward will be recommended for a non-executive position at BP's Russian joint venture as Mr. Dudley takes his place effective Oct. 1.
Mr. Dudley's challenges are many: He needs to cap the spill completely, regain the affection of his shareholders who have bailed on the company and pushed down the stock by more than 35 per cent, navigate the company's way through a political and legal minefield in the United States, sell assets and rebuild BP's reputation.
The change at the helm came as BP posted a second-quarter loss of $17.2-billion (U.S.), compared to a profit of $4.39-billion a year earlier, and said it would speed up asset sales to up to $30-billion. It also set aside more than $30-billion to cover its costs of the disaster that began with the explosion on the Deepwater Horizon drilling rig in April.
Here's what chairman Carl-Henric Svanberg said: "BP remains a strong business with fine assets, excellent people and a vital role to play in meeting the world's energy needs. But it will be a different company going forward, requiring fresh leadership supported by robust governance and a very engaged board."
Here's what some analysts said, according to The Associated Press, Bloomberg News and The New York Times:
- "His first job is to convince people BP is going to come back and you better buy BP stock while it's cheap." Amy Myers Jaffe of Rice University in Houston
- "The two aspects of Dudley's work that make him an optimal candidate for CEO are that he's not Tony Hayward and he speaks with an American accent." Pavel Molchanov of Raymond James, noting that by naming an American, the company is broadcasting that it's serious about its interests in the U.S.
- "The triple pronged approach of increased provisions, asset sales and a new CEO should be a potent mix in forming a strong future foundation. Behind the obvious headlines, the underlying trading performance was robust with a significant improvement having been made on a like for like basis." Richard Hunter, head of U.K. Equities at Hargreaves Lansdown Stockbrokers
- "Dudley is seen as a safe pair of hands. "What I've been more reassured by is that they're selling into quite a good market. BP is looking more attractive with that." Colin McLean of SVM Asset Management Ltd.
- "The charge is bigger than expected, but I'm not disappointed. They are trying to draw a line under this and get Bob a clean sheet to move forward, but the difficulty is that the litigation challenge persists." Nick McGregor, investment manager at Redmayne Bentley
- BP hands reins to Dudley
- Dudley's path followed unusual turns to CEO of BP
- BP taps all-American as next CEO
- The rise and fall of Tony Hayward
Talisman profit jumps Talisman Energy Inc. today posted a sharply higher second-quarter profit of $603-million or 59 cents a share, compared to $63-million or 6 cents a year earlier. Talisman has been in transition mode and, said chief executive officer John Manzoni, "we are on track to deliver on our key promises for the year."
"Year on year, our underlying production volumes have increased this quarter and we expect this trend to continue through the second half of 2010," he said. "We have made substantial progress toward our announced $1.9-billion of asset sales for the year and ... we continue to reduce net debt and strengthen the balance sheet."
Mr. Manzoni also said Talisman has conducted a sweeping review of its drilling operations given the BP spill in the Gulf, including well design, procedures, training and equipment, and "this review gives us confidence in our operations, and reinforces the need to remain vigilant at every stage."
Consumer confidence slips Markets may be brighter today but consumer confidence in Canada is on the wane. The Conference Board of Canada's consumer confidence index dipped 3.7 points in July to 80. Notable is that that sagging feeling was widespread across the country, unlike in June, when the dips were registered in just two provinces. Least happy among us are those in British Columbia, where the index slipped 12.5 points.
"Consumers were feeling slightly less optimistic about their current income situation this month, perhaps in reaction to the implementation of the harmonized sales tax in Ontario and British Columbia," the group said. "... While recent labour market reports point to strength in the Canadian labour market, survey respondents continue to be cautious about future job prospects in their community."
Consumer confidence in the U.S. also slipped in the latest reading released today by the U.S.Conference Board. Its consumer confidence index dipped to 50.4 in July from 54.3 in June.
"Overall, with consumers so glum and the woes of the housing market far from over, it is clear that GDP growth will slow in the second half of the year as private sector demand fails to compensate for the fading of the fiscal stimulus," said Paul Dales, U.S. economist with Capital Economics.
Case and Shiller downbeat U.S. home prices rose in May, the second month in a row, in what is traditionally a strong month, leading some economists to project the uptick won't last. The S&P/Case-Shiller price index of 20 cities showed a gain of 1.3 per cent over April, with only Las Vegas posting a drop. So far, home prices in the U.S. have climbed 5.1 per cent from the trough in April 2009, but they're still 29 per cent below the peak reached in mid-2006.
Karl Case and Robert Shiller, who created the index, are notably downbeat. Mr. Case, a former Wellesley College professor, told Bloomberg Radio today that home construction is "stuck in the mud ... We're not building anything."
Separately, Mr. Shiller, an economics professor at Yale University, told Reuters he's worried about the state of the U.S. economy overally, fearing a double-dip recession. "For me a double-dip is another recession before we've healed from this recession," he told the news agency. " ... The probability of that kind of double-dip is more than 50 per cent. I actually expect it."
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Rogers profit jumps Rogers Communications Inc. today managed to meet or, in some cases, top analysts' estimates although growth in new wireless customers is slipping. Profit jumped to $464-million or 80 cents a share in the quarter from $412-million or 65 cents a year earlier, but it also saw a 50-per-cent decline in new high-value wireless customers amid heightened competition. Rogers still dominates the smart phone market, activating 385,000 devices in the quarter, and helping to continue its strong wireless data revenue growth, The Globe and Mail's Iain Marlow reports.
Making Gerry Schwartz's day Onex Corp. and the Canada Pension Plan Investment Board have struck their deal for Britain's Tomkins PLC. The Canadian players are offering £2.89-billion or $4.5-billion (U.S.) for the British auto parts and bath tub manufacturer. It's the latest in a string of investments by Onex in the manufacturing sector. Analysts said a competing bid could always block the offer, but they see that as unlikely.
The takeover of Tomkins, noted the Reuters news agency, would mark the end of an industrial concern once called the "buns to guns" conglomerate in the 1990s because it was, at the time, the parent of the Rank Hovis McDougall food company and Smith & Wesson, well known for, among other things, the .357 Magnum. It sold the gun maker almost a decade ago. So go ahead, make Gerry Schwartz's day.
From today's Report on Business
- Conrad Black ruling likely a month away
- A losing bet on coal and iron ore
- The Inco men are back
- Vox: Hunting for more in Canada's diamond fields
And, read our Streetwise blog and Your Business section