Expect more suffering for Microsoft and HP in 2013

The PC industry is in shambles and no one is going to be hit harder than Microsoft (MSFT) and Intel (INTC), according to the latest forecasts from market research firm Canalys. Consumers continue to favor Android and iOS tablets over Windows and Intel (a.k.a., “Wintel”) PCs. The research firm found that combined shipments of desktops, netbooks and notebooks in the fourth quarter of 2012 declined roughly 10% year-over-year. The Wintel PC market is expected to suffer further and is estimated to fall from a 72% market share in 2012 to a 65% share in 2013, representing a 5% decline in unit shipments.
[More from BGR: ‘Apple is done’ and Surface tablet is cool, according to teens]
“Pads and, increasingly, smartphones can perform many of the day-to-day computing tasks that most people require,” said Pin-Chen Tang an analyst with Canalys. “Wintel PCs are becoming less likely as an individual’s first choice of computing device for everyday tasks, such as sending e-mail or web browsing.”
[More from BGR: Is BlackBerry back? Strong early BlackBerry 10 demand could signal RIM comeback]
The launch of Windows 8 was meant to revitalize the market, however it has had little to no impact so far. Despite sales roughly equal to its predecessor, a majority of consumers have shunned the new operating system and instead favored OS X or Windows 7. The overall consensus from analysts, consumers and the media is that Microsoft’s Metro user interface is too confusing for the average PC buyer.
“The launch of Windows 8 did not reinvigorate the market in 2012, and is expected to have a negative effect as we move into 2013,” explained Canalys analyst Tom Evans. ”Windows 8 is so different to previous versions that most consumers will be put off by the thought of having to learn a new OS. An additional barrier is the potential increase in cost that Windows 8 brings, as it is perceived that a PC with a touch-screen is needed to get the best user experience. In the current economic climate, this will be enough to make people delay purchases as they wait for prices to fall.”
Canalys predicts that between 2014 and 2016, the PC industry will see a larger mix of different form-factors as consumers become more comfortable with touchscreens and Windows 8. In addition, the firm expects the tablet market to grow an average of 37% each year between 2012 and 2016, with volumes reaching 389 million units and accounting for 59% of all PC shipments. The tablet growth will be driven by Apple’s (AAPL) iPad, iPad mini, low-cost Android alternatives and hybrid PCs such as the Surface Pro.
“It is clear that Microsoft is now pushing touch as the primary input method for Windows, but keyboard and mouse are still needed for legacy applications,” Canalys analyst Tim Coulling added. “Following the launch of the iPhone, the shift from keypad/keyboard to touch input on smart phones was rapid. The popularity of pads and the inevitable decline in touch-panel prices will cause the same trend to emerge in the PC market.

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News Summary: US home sales rise 2.1 pct. in Oct.

SALES RISE: U.S. sales of previously occupied homes rose moderately in October, helped by improvement in the job market and record-low mortgage rates. Sales rose 2.1 percent in October to a seasonally adjusted annual rate of 4.79 million according to the National Association of Realtors.
INVENTORIES: A decline in housing inventory is helping push prices higher. There were only 2.14 million homes available for sale at the end of the month, the lowest in 10 years.
GAINS LIKELY TO CONTINUE: As the economy slowly recovers, more people have started looking to buy homes or rent apartments. Mortgage rates are at record lows and rents are rising. That makes buying a home more attractive.

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News Summary: US 30-yr mortgage rate at record low

RATES AT RECORD LOW: Average U.S. mortgage rates fell to fresh record lows this week, a trend that is boosting home sales.
THE NUMBERS: Mortgage buyer Freddie Mac said the average 30-year loan rate dipped to 3.31 percent, the lowest on records dating back to 1971. The average on the 15-year fixed mortgage dropped to 2.63 percent, also a record.
HOUSING RECOVERY: Home sales and construction are rising, providing a much-needed boost to the economy. Lower rates have also persuaded more people to refinance. That usually leads to lower monthly mortgage payments and more consumer spending.

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Retirement Savings Plan Reality: Save More

There's a buzz building in California over a state move to create a retirement savings plan for private employees with no workplace 401k. It might seem that everyone has plenty of access to a retirement savings plan, but at least a third of U.S. households get to retirement with just Social Security to back them up, reports MarketWatch.
The "pioneering" part of such a retirement savings plan would be the opt-out clause. Under the California plan, which has to get past some federal rules and IRS hurdles, eligible workers would be automatically registered with the plan at a deduction rate of 3% of pay. They would have to choose to quit the plan, although of course they could instead choose to increase the takeout.
The enforced deductions requirement of a good retirement savings plan is backed by research from Harvard and the University of Copenhagen. According to the research, giving people a tax break encourages them to save, but not much. Using data from Denmark, which is similar to the U.S. system but offers more detail, academics found that tax subsidies worth $1 raised the national savings rate by a penny.
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That's not much bang for a buck. Meanwhile, previous research found that an automatic retirement savings plan, such as the proposed California "opt-out" model, is very effective at raising savings rates.
The reason, the researchers conclude, is that only about 15% of people in the system are active savers, that is, people who think about retirement and how much money it will take to achieve that goal. The remainder, a whopping 85%, are totally passive savers. They will save if obligated but make no concrete plan regarding their life after work.
All of this would be quite the revelation, except that private pensions have a long and quite well-documented history, starting back in 1980 in Chile. Under reforms instituted by the military regime of the time, anyone with a formal job in the South American country is required to pay 10% beyond a minimum monthly income level. There is an income tax break, too, on retirement savings plan contributions, which can be up to 20%.
More On Forbes: Do You Have Enough Money To Retire
The Chilean system was reformed in 2008 to create a bigger safety net for the poor, essentially granting public pensions to those who did not earn enough to participate in the private system. Currently, 13 countries have either private or quasi-mandatory pension systems, reports the OECD.
All pension plans fall into two categories, defined benefit or defined contribution (DC). A defined benefit plan puts the burden on future taxpayers to meet a minimum payout, which is essentially how Social Security works in the United States. A defined contribution retirement savings plan, the basis for private pension systems such as a 401k, means it's up to savers to put enough away and to invest and manage their savings carefully over decades.
Your retirement savings plan
As the OECD notes, "the starting point for a successful DC plan is a sufficiently high contribution rate." Put another way, depending on the market to deliver miracles is a mistake, but a similarly large (and common) mistake is believing that setting aside pennies in a retirement savings plan will add up to big dollars down the line.
The agency concludes:
In DC pension systems, one clear goal for policymakers should be to improve the design of default investment strategies so that investment risk is reduced as the worker approaches retirement. Such lifecycle investment strategies may need to be carefully regulated to ensure that workers are offered sufficient diversification and protection from market shocks in old age.
Amen and hallelujah, we say. Whatever the outcome in California, two points about a proper retirement savings plan by now should be impressively clear to everyone: You need to save more, sooner, and you absolutely must have a serious, long-term investment plan to protect and grow that nest egg over time.

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Record earnings for South Korean league

(Reuters) - South Korean baseball underlined its continuing growth by posting a record $33 million in revenue last year, local media reported on Wednesday.
Winning gold at the Beijing Olympics and finishing runners-up at the 2009 World Baseball Classic boosted baseball's popularity and attendances crossed the 7 million-mark for the first time last year, Yonhap News agency reported.
The league pocketed 35 billion won ($32.9 million) in 2012, bettering the 34 billion it earned a year earlier, the report said citing figures from the marketing wing of the Korea Baseball Organization (KBO).
The league received 25 billion won from its television broadcasting contract and 8 billion from corporate sponsorship, while 2 billion came from merchandise sales.
Each of the eight KBO clubs, having collectively drawn 7.15 million fans, took home 3.8 billion won after the league broke its attendance record for the fourth straight year.
The KBO will welcome a ninth club this year in what would be the league's first expansion since 1991 while another team could be included in 2015.

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Judgment day for Bonds, Clemens, Sosa at Hall

NEW YORK (AP) — Judgment day has arrived for Barry Bonds, Roger Clemens and Sammy Sosa to find out their Hall of Fame fates.
With the cloud of steroids shrouding many candidacies, baseball writers may fail for the only the second time in more than four decades to elect anyone to the Hall.
About 600 people are eligible to vote in the BBWAA election, all members of the organization for 10 consecutive years at any point. Results were to be announced at 2 p.m. EST Wednesday, with the focus on first-time eligibles that include Bonds, baseball's only seven-time Most Valuable Player, and Clemens, the only seven-time Cy Young Award winner.
Since 1965, the only years the writers didn't elect a candidate were when Yogi Berra topped the 1971 vote by appearing on 67 percent of the ballots cast and when Phil Niekro headed the 1996 ballot at 68 percent. Both were chosen the following years when they achieved the 75 percent necessary for election.
"It really would be a shame, especially since the other people going in this year are not among the living, which will make for a rather strange ceremony," said the San Francisco Chronicle's Susan Slusser, president of the Baseball Writers' Association of America.
Three inductees were chosen last month by the 16-member panel considering individuals from the era before integration in 1946: Yankees owner Jacob Ruppert, umpire Hank O'Day and barehanded catcher Deacon White. They will be enshrined during a ceremony at Cooperstown on July 28.
Also on the ballot for the first time are Sosa and Mike Piazza, power hitters whose statistics have been questioned because of the Steroids Era, and Craig Biggio, 20th on the career list with 3,060 hits — all for the Houston Astros. Curt Schilling, 11-2 with a 2.23 ERA in postseason play, is another ballot rookie.
The Hall was prepared to hold a news conference Thursday with any electees. Or to not have one.
Biggio wasn't sure whether the controversy over this year's ballot would keep all candidates out.
"All I know is that for this organization I did everything they ever asked me to do and I'm proud about it, so hopefully, the writers feel strongly, they liked what they saw, and we'll see what happens," Biggio said on Nov. 28, the day the ballot was announced.
Jane Forbes Clark, the Hall's chairman, said last year she was not troubled by voters weighing how to evaluate players in the era of performance-enhancing drugs.
"I think the museum is very comfortable with the decisions that the baseball writers make," she said. "And so it's not a bad debate by any means."
Bonds has denied knowingly using performance-enhancing drugs and was convicted of one count of obstruction of justice for giving an evasive answer in 2003 to a grand jury investigating PEDs. Clemens was acquitted of perjury charges stemming from congressional testimony during which he denied using PEDs.
Sosa, who finished with 609 home runs, was among those who tested positive in MLB's 2003 anonymous survey, The New York Times reported in 2009. He told a congressional committee in 2005 that he never took illegal performance-enhancing drugs.
The BBWAA election rules say "voting shall be based upon the player's record, playing ability, integrity, sportsmanship, character, and contributions to the team(s) on which the player played."
"Steroid or HGH use is cheating, plain and simple," ESPN.com's Wallace Matthews wrote. "And by definition, cheaters lack integrity, sportsmanship and character. Strike one, strike two, strike three."
Several holdovers from last year remain on the 37-player ballot, with top candidates including Jack Morris (67 percent), Jeff Bagwell (56 percent), Lee Smith (51 percent) and Tim Raines (49 percent).
When The Associated Press surveyed 112 eligible voters in late November, Bonds received 45 percent support among voters who expressed an opinion, Clemens 43 percent and Sosa 18 percent. The Baseball Think Factory website compiled votes by writers who made their opinions public and with 159 ballots had everyone falling short. Biggio was at 69 percent, followed by Morris (63), Bagwell (61), Raines (61), Piazza (60), Bonds (43) and Clemens (43).
Morris finished second last year when Barry Larkin was elected and is in his 14th and next-to-last year of eligibility. He could become the player with the highest-percentage of the vote who is not in the Hall, a mark currently held by Gil Hodges at 63 percent in 1983.
Several players who fell just short in the BBWAA balloting later were elected by either the Veterans Committee or Old-Timers' Committee: Nellie Fox (74.7 percent on the 1985 BBWAA ballot), Jim Bunning (74.2 percent in 1988), Orlando Cepeda (73.6 percent in 1994) and Frank Chance (72.5 percent in 1945).
Ace of three World Series winners, Morris finished with 254 victories and was the winningest pitcher of the 1980s. His 3.90 ERA, however, is higher than that of any Hall of Famer. Morris will be joined on next year's ballot by Greg Maddux and Tom Glavine, both 300-game winners.
If no one is elected this year, there could be a logjam in 2014. Voters may select up to 10 players.
The only certainty is the Hall is pleased with the writers' process.
"While the BBWAA does the actual voting, it only does so at the request of the Hall of Fame," said the Los Angeles Times' Bill Shaikin, the organization's past president. "If the Hall of Fame is troubled, certainly the Hall could make alternate arrangements.

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Column: No suspense for Bonds, Clemens in HOF vote

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Barry Bonds can go for a bike ride. Roger Clemens might want to head to the gym for one of those famous workouts that used to make him pitch like he was 22 when he was 42.
If the polls are right — and my guess is they're pretty spot on — there's no need for either to wait by the phone Wednesday when baseball writers weigh in with their first verdict on what is arguably the greatest class of Hall of Fame candidates since Ty Cobb and Babe Ruth were among the inaugural inductees 77 years ago.
Bonds and Clemens won't get in, and no one else may either. In a fitting twist, the player who is most likely the leading candidate to make it is known almost as much for getting hit by pitches as hitting them himself.
Actually, Craig Biggio had 3,060 hits to go with the 285 times he got hit, and being a member of the 3,000-hit club usually guarantees a spot in Cooperstown. But in any other time the greatest home run hitter ever and only pitcher to win seven Cy Young awards would be absolute locks, too.
This, however, is as much a referendum on the Steroids Era as it is on the numbers that are so sacrosanct in baseball. This is about what people suspect players did while they were off the field, not what they accomplished while on it.
And this may be the last chance anyone has of somehow trying to make it right.
No, denying Bonds a spot in the Hall of Fame won't wipe away the bloated numbers that will almost surely scar the record books for generations to come. But it does put a giant asterisk that Bud Selig and the rest of baseball refuse to attach next to the 73 home runs he hit in one season, or the 762 he slugged through his career.
And while Clemens will keep his Cy Young awards, keeping him out of Cooperstown at least sends a message that maybe next time we won't be so easily hoodwinked again.
It shouldn't be the job of baseball writers to make the final statement about the Steroids Era; indeed some of the voters I know are quite uncomfortable with trying to sort out who did what and when. They're not the steroid police, as they often point out, and don't know any better than the guy next to them in the locker room who did what and when.
But Selig and his minions failed time and time again to confront the epidemic that swept through the game the last few decades. They used the power surge — four of the top 10 all-time home run hitters are either admitted steroid users or associated with them — to bring fans back to the ballparks who were disillusioned with baseball after a bitter strike wiped out the playoffs and the World Series in 1994.
They sat back and watched the cash registers heat up, knowing all along that much of it was built on a giant fraud. And they certainly didn't follow criteria that is spelled out for Hall of Fame voters, who are pledged to look at not only a player's numbers but the "integrity, sportsmanship, character and contributions to the team(s)" on which he played.
Under those guidelines, Bonds and Clemens don't qualify. Neither does Sammy Sosa, who thankfully will receive only a handful of votes in his first year of eligibility.
Unlike Sosa and Mark McGwire — who at least admitted he used steroids — the odds are that Bonds and Clemens will one day be enshrined in the hall. As the years go by and the stigma of the steroid era fades, they'll gain support among voters and probably make the 75 percent threshold required for admittance.
Unfortunately for some of those on the ballot with them, they may have to wait, too. That includes Mike Piazza and Jeff Bagwell, whose numbers have to be looked at twice not because they've been accused of wrongdoing but because they were put up in the heart of the Steroids Era.
That may not be fair to them, but the Hall of Fame is an exclusive place where fairness does not always carry the day. How else to explain why the late Roger Maris was never voted in, despite breaking Ruth's home run record with 61, a mark that stood for 37 years before McGwire and Sosa obliterated it in the home run orgy of 1998.
We may never know exactly what Bonds did to hit home runs unlike any human being before him. He's not talking, though a look at the newly svelte slugger today suggests that the change in his body size isn't completely due to his new love of cycling.
Don't expect Clemens to be any more forthcoming, either. Not after a jury in Washington, D.C., sided with him over accusations by former trainer Brian McNamee that he injected the pitcher with human growth hormone to salvage what was left of his good name.
They hurt baseball more than the banned and disgraced Pete Rose ever did by betting on games. Maybe, like Rose, they need some more time before explaining what really happened.
Meanwhile, they'll continue to keep us all hanging, including the sport and fans that made them rich.
Fortunately, baseball writers are in a position to return the favor.

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Top UBS shareholder pins rebound hopes on private wealth

LONDON (Reuters) - UBS's wealth management business will help it bounce back from a $1.5 billion rap for rigging interest rates, one of its largest investors said, although fears of costly civil lawsuits could cast a pall over its shares for some time.
Paras Anand, European equities head at Fidelity Worldwide Investment, said legal action sparked by the Libor scandal posed an unpredictable threat to the bank's near-term earnings, even if its core private banking franchise escaped permanent harm.
"The big unknown factor is the civil litigation that could follow on as a result of this...That is one thing at the back of our minds that we have to be cognizant of," Anand said in an interview with Reuters.
"The issue for shareholders is the challenge of pricing that risk in. The potential costs are too unquantifiable and indeed, it's unclear as to whether they will actually manifest or not."
Switzerland's largest bank was hit with the fine on Wednesday after admitting to fraud, paying bribes to brokers and "pervasive" manipulation of global benchmark interest rates by dozens of its staff.
UBS shares were trading 1.3 percent higher at 9:01 a.m. ET, as investors looked forward to the end of a scandal-filled chapter in the bank's history and a renewed focus on managing cash on behalf of rich clients, rather than so-called 'casino' investment banking.
"There's clearly been a backlash against big faceless financial entities but a private bank has big personal relationships with its customers ... These kinds of institutions are surprisingly resilient," Anand said.
"We have seen some awful scandals in businesses much weaker than UBS and they manage to survive," he added.
Fidelity owns around 45 million shares in UBS, equivalent to around 1.2 percent of the bank, and is its fifth largest institutional owner excluding sovereign wealth funds, according to Thomson Reuters data.

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Drugs group Lundbeck's shares hit by profit warning

COPENHAGEN (Reuters) - Shares in Danish drugs firm Lundbeck fell to their lowest level in over 12 years on Wednesday after it cut its profits forecast for the next two years as European sales slow and spending on new products rise to combat generic competition.
The company has already warned that earnings would stall until 2015 due to cheap generic competition for its existing drugs, meaning new products will be vital for future earnings.
But Chief Executive Ulf Wiinberg said on Wednesday that the negative impact on revenue from healthcare reforms in Europe had also been bigger than expected in the last two years and that slowing European sales and generic competition were hurting.
As a result the company said operating profits would fall further than previously forecast in 2014 as it increases investments in its late-stage drugs development pipeline and product launches.
Lundbeck is working to find new drugs to replace lost revenue from products coming off patent protection such as its antidepressant Cipralex, which is sold as Lexapro in the United States and Japan, and Alzheimer's drug Ebixa.
Wiinberg said 2014 would be the company's peak investment year for the new products pipeline, offering it a solid foundation for growth starting in 2015.
"You only get one chance to launch a product and we have to do it well," Wiinberg said at a briefing for investors.
He was commenting after the company warned in a statement that it now expects revenue in 2014 of about 14 billion Danish crowns ($2.5 billion) and an operating profit of between just 0.5 billion and 1 billion crowns.
Analysts have on average been forecasting a profit of over 2.5 billion crowns for 2014 on turnover of over 14.7 billion crowns, according to Thomson Reuters I/B/E/S Estimates.
Two years ago Lundbeck predicted its annual revenues over the period 2012-2014 would exceed 14 billion crowns a year while earnings before interest and tax (EBIT) would exceed 2 billion crowns a year.
Next years' revenue is now forecast to be in the range of 14.1 billion and 14.7 billion crowns to produce an operating profit of 1.6 billion to 2.1 billion crowns, with no change to the company's forecast for 2012.
Analysts' forecasts for this year are for operating profit to drop 41 percent to 1.99 billion crowns on revenue down 8 percent at 14.7 billion crowns, while for 2013 they predict a profit of 2.26 billion crowns on revenue of 14.5 billion crowns.
Lundbeck's shares were trading down 17 percent at 79.90 crowns at 12.44 p.m. British time, dropping below 80 crowns for the first time since April 2000.
"In the short term, earnings are under pressure," Sydbank analyst Soren Hansen said.
Lundbeck said that it expects a dividend payout ratio of about 35 percent of net profits in the 2012-14 period. Last year it paid 3.49 crowns on basic earnings per share of 11.64 crowns, a payout ratio of 30 percent.
Analysts have been predicting a 27-30 percent cut this year to 2.53-2.28 crowns, according to Thomson Reuters StarMine data.
But a number of analysts doubt that revenue from new products will be enough to secure revenue growth in 2015, compensating for lost revenue from Cipralex, Lexapro and Ebixa which together accounted for about 70 percent of group revenue in 2011.
Lundbeck is working on new products such as antidepressant Brintellix in Europe and the United States for launch at the end of next year or start of 2014, as well as alcohol dependency treatment Selincro in Europe in mid 2013.
"It is difficult to see revenue from the smaller products compensating for the large products," said Hansen.

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New Mauritius Hotels posts 25 pct drop in full-year profit

PORT LOUIS (Reuters) - Luxury hotels group New Mauritius Hotels (NMH) reported a 25 percent fall in full-year pretax profit, citing higher finance costs and fewer tourists, and forecast a 15 percent drop in first-quarter earnings.
Ranked among the Indian Ocean island's most-traded stocks, NMH said on Wednesday that pretax profit for the year to September 30 fell to 603 million Indian rupees, with earnings per share down 20 percent at 3.60 rupees.
The hotels group said that it won't pay a dividend this year, given the difficult conditions in the local tourism industry. Last year it paid a dividend of 2.50 rupees per share.
Shares in the group, which owns eight hotels in Mauritius and one in the Seychelles, closed unchanged at 52 rupees before its results were released.
Tourism, a traditional cornerstone of the Mauritius economy, has been forecast to account for 7.9 percent of domestic product in 2012, down from 8.4 percent last year. The downturn in tourism has been caused largely by economic turmoil in the euro zone - the sector's key source market.

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