Tag: economy

Facebook is worth $227 billion to the globe

globe-museum03Social not working site Facebook is worth $227 billion worth to the world and created 4.5 million jobs in 2014.

A report from beancounters Deloitte & Touche, which was commissioned by Facebook, claimed that with 1.35 billion users of its Internet social network, Facebook  would rank as the world’s second-most populous nation if it were a country.

Deloitte & Touche based its figures on the businesses that maintain pages on  Facebook as well as the mobile apps and games that consumers play on Facebook and measures all the economic activity that result. It also considered the demand for gadgets and online connectivity services that are generated by Facebook.

Some of the cash, such as when a company advertises to customers on Facebook, can be directly attributed to Facebook. However, when consumers donated $100 million for research into amyotrophic lateral sclerosis during this summer’s Ice Bucket challenge, Facebook’s auto-play video ads were a key factor.

Facebook Chief Operating Officer Sheryl Sandberg claimed Facebook was helping create a new wave of small businesses in everything from fashion to fitness. She cited a group of young women in Bengaluru, India, who started a hair accessory business using Facebook and a mother in North Carolina who started the Lolly Wolly Doodle line of clothing, selling to customers through Facebook.


Apple destroyed Santa’s home

screen480x480The fruity cargo cult Apple should be declared public enemy number one in Finland for the damage it caused to the nation’s economy.

The country’s Prime Minister Alexander Stubb said that Apple’s products have affected its mobile device and paper industries to such a level that it caused an economic downturn. It has  also caused the Nordic country to endure a sovereign debt rating downgrade.

Stubb said that Finland had two industrial problems and two champions which went down — Nokia in the ICT sector, and the other has to do with the forest and paper industry.”

“One could say that the iPhone killed Nokia and the iPad killed the Finnish paper industry, but we’ll make a comeback.”

Of course it is not Apple’s fault – there were shedloads of other technology companies which cleaned Nokia’s clock and the paper industry had been suffering for a while.

Statistics from the Finnish Forest Research Institute found that the forest and paper industry has contracted over the last few years, with the institute’s most recent report for 2013 warning of a “poor situation” for paper production, as well as a forecast that exports would continue to shrink in 2014.

The rise of electronic devices cannot be directly blamed for the paper industry’s issues in the country, the rise of online publications at the expense of newspapers could be seen as a contributing factor. Stubb hopes that instead of flogging trees to newspapers, they might make a nice form of bio energy. Perhaps the Finns should follow Sweden and move into flat pack furniture as a better use for its trees.


UK GDP grows 0.6 percent

ukflagThe latest data from the Office for National Statistics estimates the UK’s Gross Domestic Product (GDP) grew 0.6 percent sequentially in the second quarter, and have predictably been jumped on by both the Conservatives and Labour.

The biggest contribution to GDP was the services industry, growing 0.6 percent or 0.48 percentage points to the 0.6 percent increase. Productive industries also grew with a contribution of 0.08 percentage points, as manufacturing increased 0.4 percent after negative growth in the first quarter. However, all of these industries are well below their pre-crash levels.

The GDP growth, the ONS says, now puts the UK at 3.3 percent below the peak in Q1 2008, before the worldwide economic crash.

The growth was expected by the market and did not affect the London Stock Exchange, the BBC reports.

GDP was growing steadily between 2000 and early 2008 before the financial market crashed. Services continued to grow but production was largely flat, although construction was experiencing a boom at the beginning of the decade. The 2008 crash had an effect on all industries, particularly construction and production.

Economic growth did pick up late 2009 but at a far slower rate than prior to the crash. The crisis in the Eurozone swelled in 2010 creating further economic uncertainties and slowed growth again. According to ONS data, because construction and production has only managed to approach 2009 levels, GDP growth since then is attributable to services instead.

Although GDP growth has been welcomed, it does not necessarily translate into standards of living in real terms, and has its own set of criticisms as a measure of economic wellness.

Shadow chancellor Ed Balls said “families on middle and low incomes are still not seeing any recovery in their living standards,” noting that wages have not risen with prices. Coalition chancellor George Osborne admitted “things are still tough for families”.

The creeping growth – nowhere near pre-2008 levels and after years of remaining flat – is terrifically vulnerable in a very uncertain global economy.

It’s not time to put the Tesco Value Cava on ice just yet: EU countries are increasingly volatile, austerity policies are being demanded all across the world, shocks to the markets could happen at any moment and in private industry, the prevailing attitude is one of caution.

Inflation unchanged. It’s a record

nippergonerConsumer price inflation was unchanged for the fourth month in the row this January, according to data from the Office for National Statistics, making it the longest period of no change since records began in 1996.

The ONS said a price boost in alcohol and tobacco was the main factor sending prices up, while there were slower rises for clothing and footwear. The latter rose 0.2 percent year on year, and were a 5.4 percent drop compared to the previous month.

Alcohol and tobacco prices were up nearly 10 percent – at 8.5 percent – year on year, and were also up an enormous 4.3 percent from the previous month as Christmas discounts wound up.

For miscellaneous goods and services, prices were down 0.7 percent compared to December.

The ONS’ Phil Gooding told the BBC that there were some other factors worth paying attention to. Utility price rises haven’t entered the index yet, asserting that there will be more to come – which will have an uptick on the figures.

“We also have to watch out for oil prices,” Gooding said. “These have been failling for four or five months but in January they started to rise again”.

Pressure on high street retail could also have a downward effect, Gooding said.

While salaries are largely frozen and unemployment figures are still drastically high, consumers are struggling to buy – which would put money back into the economy. Investec economist Victoria Clarke told the BBC that the “squeeze on real spending power remains very much in place” – but, some recent small increases in employment have put a bandaid on an otherwise worrying problem.

Triple dip recession threat leaves channel unbothered

gosborneAccording to the Office for National Statistics (ONS), the British economy shrank 0.3 percent in the fourth quarter of 2012, reflecting wider economic woes in the Eurozone and further afield.

The figures were lower than expected for the last three months of 2012 and have sparked fears that, if the economy does not pick up, the UK will enter an unprecedented ‘triple dip recession’ – although arguably, Britain never left the recession at all. Chancellor George Osborne has warned that tough times still lie ahead for the country, but shirked advice from the International Monetary Fund that he and the Coalition should ease up on the policy of austerity.

On the GDP figures, Osborne said: “We have a reminder today that Britain faces a very difficult economic situation”.

The figures serve as a “reminder that last year was particularly difficult” and that the country faces problems at home “because of the debts built up over many years and problems abroad with the Eurozone, where we export most of our products, in recession”. The opposition accused Osborne and Prime Minister David Cameron of being “asleep at the wheel”, although the macroeconomic environment is unrelentingly difficult and both Labour and Conservatives differ on many minutae of policy – with the wider climate beyond their control.

GDP, meanwhile, was flat compared to the same time last year. Production output decreased by 1.8 percent for the quarter, negating a 0.7 percent increase between the second and third quarters. Service industry output was flat from Q3 into Q4, although that followed a 1.2 percent boost between Q2 and Q3 2012.

Britain enjoyed steady GDP growth from 2000 right up until the world markets crashed in 2008, and according to the ONS, the decline of economic conditions in 2008 and up until now has had a significant effect on construction and production – though the service sector wasn’t hit as hard, and is now slowly returning to 2008 levels.

In October last year, channel analyst house Canalys’ CEO, Steve Brazier, said that, despite the difficult economic climate, there is still opportunity in the channel. Although growth was not exactly meteoric, Brazier said that by carefully steering the ship, channel players could weather the storm, although the market will be tough.


Senior analyst at Canalys, Rachel Brindley, offered some thoughts to ChannelEye on just what channel players can do to push through the crisis. She tells us the situation isn’t exactly all doom and gloom.

“Some partners will struggle if this economy goes into a triple dip recession,” Brindley said, “but there is a chance that it could happen. That being said, a lot are well placed – those who focus on customer service, keeping existing customers very close, growing their services business an diversifying their portfolio into things like managed services and data centres, will rise to the difficult times we’ve been going through”.

“Generally,” Brindley said, “those that focus on their customers, and diversify their business away from traditional hardware and box shifting will come through OK, it will come down to careful planning and taking opportunities in spaces like the data centre and looking at what’s going on in the networking space”.