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Portfolio

Issue 74 ■ February 2012

Exclusive to Emirates First Class and Business Class

GETTING TOUGH Italy’s Tax Overhaul SHALE GAS Creating A Dilemma INTERNET MEDIA Challenging the Industry

Yang Yuanqing

Lenovo’s Master Strategist

emirates.com


E vEry rolE x is madE for grE atnE s s. thE day-datE, introducEd in 1956 , was thE first watch to displ ay thE datE, a s wEll a s thE d ay i n i t s E n t i r E t y. a p o w E r f u l E x p r E s s i o n o f E l E g a n c E a n d s t y l E , its cl a s s ic d E s ig n quickly b Ec a mE a favour itE a mong w o r l d l E a d E r s . t h E d ay- d at E i s p r E s E n t E d h E r E i n p l at i n u m .

t he d ay -date


This issue February 2012

Portfolio

5

Exclusive to Emirates First Class and Business Class

Cover Story 24 Protect And Attack

PHOTO: GETTY IMAGES

Once an unlikely rival for HP and Apple, Chinese computer maker Lenovo has grown and adapted as quickly as its homeland thanks to dynamic leadership by CEO Yang Yuanqing and founder Liu Chuanzhi. Now, with a savvy blend of East and West, it’s poised to be China’s first global brand.

Features 30 A Comic Kills the TV Middleman

42 Opportunity & Caution

American funnyman Louis C.K. decided to release his latest

Latin American countries, such as Brazil and Mexico, have

comedy show directly on the web for $5 with no middleman

shown strong economic growth. That has focused investor

involved. Fans could have pirated it, and some did, yet a

interest on the region.

large number paid up.

34 Drilling In a Thirsty Land

46 Africa’s Research Boom Computer science and computer engineering are gaining

Energy companies want to drill gas wells in South Africa’s

traction in Africa, and with it comes research focused on

arid Karoo region using hydraulic fracturing. But this method

uniquely local problems.

uses huge amounts of water and chemicals and has met local opposition.

38 Hotels Target Upgrades During the recession when travellers cut back and credit was tight, many hotels skimped on renovations. But now there’s an upswing in the hospitality industry and discerning travellers are demanding better amenities.

50 Italy’s Taxing Problem It is estimated that Italy loses an estimated $150 billion annually in undeclared revenues. That money is badly needed to reduce the country’s $2.5 trillion public debt.

54 China Scrambles for High-tech Dominance The future of the internet is already in China and most of the world’s consumer electronics are manufactured there. The next step could be technological breakthroughs.

38

46


Portfolio

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Exclusive to Emirates First Class and Business Class

Essentials

64

59 Sicily on a Harley On a Harley-Davidson you experience freedom in a different way. You see and smell the countryside, feel the warm embrace of the wind and the camaraderie of the open road. In other words, perfect for exploring Sicily’s stunning coastline.

64 Permafrost Thaw Could Compound Warming Permafrost in the northern hemisphere is preventing a huge amount of carbon from entering the atmosphere. But now the permafrost is melting.

70

82

68 Men, Once Again, Invest in Skin Care In the middle of the ‘90s there was a boom in male cosmetics but it quickly died down. Now there’s a resurgence.

70 Wings of Fortune Hans Wiesman likes to hunt for World War II warplanes. It’s a passion that’s taken him from the jungles of Colombia to the mosquito-soaked swamps of Puerto Rico.

59

74 Concocted Languages In Demand In an effort to add reality, Hollywood and TV studios are ordering new languages such as Dothraki and Na’vi to complement fantasy and sci-fi releases.

78 Tracking An Ancient Water Source An isotope known as krypton 81 has been instrumental in unravelling the mysteries of the Nubian Aquifer.

Departments

82 A Gothic Tour of Italy

9 Notebook

Italy might be sunshine, happiness and light, but it also has

World business in a nutshell.

15 Observer

a darker side that inspired the original Gothic writers.

86 American Muscle

Spotting and analysing business trends.

22 Column: Helen Pidd Berlin Football Club Sells Out to Fans

The Camaro SS isn’t subtle with a 6.2 litre V8 engine that hits 0-100km/h in 5.4 seconds. And that’s exactly what’s great about it.

88 Other Business Portfolio takes a light-hearted look at the latest business news.

Published for Emirates by

PO Box 2331, Dubai, UAE. Telephone: (+971 4) 2824060, fax:(+971 4) 2824436, e-mail: emirates@motivate.ae

Editor-in-Chief Obaid Humaid Al Tayer Group Editor & Managing Partner Ian Fairservice Group Senior Editor Gina Johnson Senior Editor Guido Duken Editorial Assistant Hilda D’Souza Art Director Tarak Parekh Designer Charlie Banalo Senior Production Manager S Sunil Kumar Production Manager C Sudhakar Senior Advertisement Manager Jaya Balakrishnan Email: jaya@motivate.ae General Manager – Group Sales Anthony Milne Email: anthony@ motivate.ae Advertisement Manager Rameshwar Nepali Email: rameshwar@motivate.ae

INTERNATIONAL MEDIA REPRESENTATIVES AUSTRALIA/NEW ZEALAND Okeeffe Media; Tel + 61 89 447 2734, okeeffekev@bigpond.com.au BENELUX M.P.S. Benelux; Tel +322 720 9799, francesco.sutton@ mps-adv.com CHINA Publicitas Advertising; Tel +86 10 5879 5885 FRANCE Intermedia Europe Ltd; Tel +33 15 534 9550, administration@intermedia.europe.com GERMANY IMV Internationale Medien Vermarktung GmbH; Tel +49 8151 550 8959, w.jaeger@imv-media.com HONG KONG/MALAYSIA/THAILAND Sonney Media Networks; Tel +852 27 230 373, hemant@sonneymedia.com INDIA Media Star; Tel +91 22 4220 2103, ravi@mediastar.co.in ITALY IMM Italia; Tel +39 023 653 4433, lucia.colucci@fastwebnet.it JAPAN Tandem Inc.; Tel + 81 3 3541 4166, all@tandem-inc.com NETHERLANDS GIO Media; Tel +31 6 2223 8420, giovanni@giomedia.nl SOUTH AFRICA Ndure; Tel: +27 84 701 2479, dale@ndure.co.za SPAIN IMM International; Tel +331 40 1300 30, n.devos@imm-international.com TURKEY Media Ltd.; Tel +90 212 275 51 52, mediamarketingtr@medialtd.com.tr UK Spafax Inflight Media; Tel +44 207 906 2001, nhopkins@spafax.com USA Totem Brand Stories; Tel +212 896 3846, brigitte.baron@totembrandstories.com

Emirates takes care to ensure that all facts published herein are correct. In the event of any inaccuracy, please contact The Editor. Any opinion expressed is the honest belief of the author based on all available facts. Comments and facts should not be relied upon by the reader in taking commercial, legal, financial or other decisions. Articles are by their nature general, and specialist advice should always be consulted before any actions are taken.

Printed by Emirates Printing Press, Dubai, UAE

Portfolio


Notebook

9

REUTERS

BUSINESS NEWS IN BRIEF

Record Year Projected The makers of expensive cars are

other elite auto brands are projecting a

pushing beyond their traditional markets

bumper year.

in the US and Europe to emerging

Porsche has better-than-expected orders for the revamped 911 sports car and its biggest backlog ever. Buyers of the

economies, where a new class of wealthy is looking to flaunt their success. Backed by an 18-month order backlog

¤263,000 Lamborghini Aventador may

for the Aventador and a six-month wait

have to wait more than a year for delivery,

for the Gallardo, Lamborghini expects

while demand from China fuelled record

to beat last year’s deliveries of 1,600 cars

deliveries in 2011 for the 107-year-old

in 2012, even with demand in Italy weak

Rolls-Royce brand, beating a mark set

because of the debt crisis.

more than three decades ago. Sales of high-end cars, including

Rolls-Royce said that growth in all regions drove deliveries 31 per cent

BMW and Mercedes-Benz, could in

higher to 3,538 cars last year, beating the

2012 surpass the record set before

previous record set in 1978 by 191 vehicles.

the financial crisis damped demand,

China became Rolls-Royce’s biggest

according to IHS Automotive. The

market in 2011, three years ahead of the

market researcher forecasts sales for the

target set by the company.

segment in 2012 of 7.02 million cars, up

German luxury-car manufacturers’ sales

Matthias Mueller, CEO of Porsche, saw car sales in China increase by 65 per cent.

cent jump for Stuttgart-based Porsche.

13 per cent from last year’s 6.23 million

last year were propelled by demand in

Audi CEO Rupert Stadler estimated that

and beating the previous record of 6.27

China, where they all posted sales gains

China’s car market will expand about

million set in 2007.

of at least 30 per cent, led by a 65 per

eight per cent in 2012. n

February 2012

REUTERS

PORSCHE, LAMBORGHINI AND


Notebook McDonald’s Extends Olympic Sponsorship

Numbers Game

$7.6

trillion of debt maturing this year looms over the world’s biggest economies with most governments likely to face a rise in borrowing costs. Led by Japan’s $3 trillion and the US’s $2.8 trillion, the amount coming due for the Group of Seven nations and Brazil, Russia, India and China is up from $7.4 trillion at this time last year.

1,968

million hours of overtime worth £29.2 billion to the UK economy was prised out of workers last year according to TUC, the UK’s national trade union centre. Workers gave bosses nearly two billion hours of unpaid overtime, enough to create a million extra full-time jobs.

Fast food giant McDonald’s will extend its sponsorship of the Olympic Games for another eight years until 2020. It is an International Olympic Committee (IOC) Top Partner,

$5.17

billion grossed worldwide wins Paramount the crown of the world’s most successful studio, toppling Warner Bros who had been the top studio for the past three years. Paramount had 16 new releases, which included top box office performers Transformer: Dark of the Moon, The Adventures of Tintin and Mission Impossible: Ghost Protocol.

The World In Figures

51

million cars sold in 2011 secured Volkswagen, Europe’s biggest carmaker, record sales last year and a rise of 13.1 per cent on 2010. New versions of models such as the Passat, Jetta and Beetle proved to be the big money spinners in spite of tough market conditions.

1.2

billion applications across iOS and Android devices were downloaded in the last week of 2011, up from 857 million downloads the previous week. This is a good indicator of how many people got iPads, iPhones and Android devices for Christmas. The US topped the list with 509 million

paying a reported $100 million for each two-games deal of one winter and one summer Games. The new deal covers the 2014 winter Games in Sochi, Russia, and 2016 summer Games in

$2.2

billion deal signed with US-based natural gas and oil producers Devon Energy gains Chinese oil giant Sinopec access to shale deposits in the US. China is the world’s biggest energy consumer with over $18.3 billion-worth of bids in 2011 according to data gathered by Bloomberg.

Rio de Janeiro, Brazil. The 2018 winter Games will be held in Pyeongchang, South Korea, and the 2020 summer venue is yet to be decided. McDonald’s has been an Olympics sponsor since 1976 and it is the seventh of the 11 top-tier sponsors to renew the partnership with the IOC until 2020. The others are Coca-

downloads, followed by China with 99 million, and the UK with 81 million.

€50

billion of extra provisions required of banks in Spain adds up to a 28 per cent hike over the prevailing provisions that banks are struggling to keep up with. The increase stipulated by the government plans to secure the nations’s €338 billion propertyrelated assets of which €176 billion are bad loans, substandard loans or repossessed properties and land, according to the Bank of Spain.

Cola, Dow Chemicals, General Electric, Omega, Procter & Gamble and Visa. A further three firms have extended their sponsorship until 2016. It is estimated that the IOC has garnered about $1 billion in sponsorship revenue in the current four-year cycle, which ends this year with the London Olympics.

GETTY IMAGES

10

Portfolio


Notebook

11

While financial-services

bonuses, compared with about

companies in London and

$300,000 to $400,000 at top

New York shrank headcount

US banks. Average pay for US

and reined in compensation,

investment bankers fell about

Brazilian investment bankers

27 per cent last year, while in

defecting to competitors won

Latin America it declined one

pay increases of as much as

per cent, according to New

25 per cent in 2011.

York-based Options Group.

The main reason is

REUTERS

PAY JUMPS FOR BRAZIL’S DEFECTING INVESTMENT BANKERS

The Brazil pay increases are

that there’s a shortage of

still below the rate for 2010,

as estimates for economic

compared with a 27 per cent

experienced executives in Latin

when executives switching

growth in Brazil decline.

drop in both the US and the

America’s largest economy.

firms commanded raises

Typical salaries for managing

Average compensation

Europe, Middle East and Africa

of as much as 35 per cent,

fell last year in all six regions

region. Compensation declined

directors in Brazil are the

according to Options Group.

researched by Options Group.

19 per cent in the Asia region,

equivalent of about $350,000

Europe’s debt crisis has forced

Latin America’s one per cent

18 per cent in Japan and 31

to $500,000, not including

some companies to pull back

decline was the smallest. It

per cent in India.

Risk for Asian Economies Europe’s debt crisis poses a growing risk to credit ratings in the AsiaPacific region, according to Standard & Poor’s Ratings Services, following the company’s series of downgrades to France and eight other euro-zone nations last month. Europe’s problems are threatening to disrupt financial markets, but governments in Asia may be helped by their strong balance sheets. However, they would have more-limited options to deal with the global fallout compared with the response in 2008, the ratings firm said. Still, S&P is optimistic that China, the bulwark of growth in Asia, should avoid a hard landing following a period of monetary tightening. Slowing inflation in China and signs of softening growth have boosted speculation that Beijing could ease credit conditions by further lowering lenders’ reserve-requirement ratio. International Monetary Fund First Deputy Managing Director David Lipton said the fund is planning to lower its global economic growth forecast for this year. “The stakes are high,” Lipton said. “Without bold action, Europe could be swept into a downward spiral of collapsing confidence, stagnant growth and fewer jobs.” No region would be immune from such a catastrophe, REUTERS

Korea, Japan and Singapore are among export-driven economies that have already seen demand hurt by Europe’s debt crisis. Australia’s economy Export-driven Singapore is vulnerable to the European debt crisis. February 2012

is also vulnerable because the country’s mining boom is strongly pinned to Asian growth.


12

Notebook DUBAI EVENT NAME: MRO MIDDLE EAST WEBSITE: AVIATIONWEEK.COM DATE: 31 JANUARY-2 FEBRUARY, 2012 VENUE: AIRPORT EXPO This high-profile exhibition takes place at the large Airport Expo venue, adjacent to Dubai’s International Airport. The Middle East’s aviation industry is one of the world’s fastest growing markets and this, in turn, has promoted a rapidly expanding maintenance, repair and overhaul (MRO) industry. MRO Middle East is strategically designed to offer the newest and most innovative concepts. The event highlights up-to-the-minute information and brings together leading industry experts to share insights on growth opportunities, cost reduction, and management strategies that maximise efficiency.

EVENT NAME: GULFOOD WEBSITE: GULFOOD.COM DATE: 19-22 FEBRUARY, 2012 VENUE: DUBAI INTERNATIONAL CONVENTION & EXHIBITION CENTRE This global platform for the food industry brings together players in the F&B industry to discuss prospective business and investment opportunities in the region. The exhibition is now in its third year and has grown phenomenally. Around 62,000 visitors from 150 countries, 3,800 plus exhibitors and 110 international pavilions underline the event’s success.

DUBAI

United Arab Emirates

EVENT NAME: MIDDLE EAST EXCLUSIVE WEBSITE: MIDDLEEASTEXCLUSIVE.COM DATE: 27-29 FEBRUARY, 2012 VENUE: DUBAI WORLD TRADE CENTRE The Middle East Exclusive (MEE) travel retail, duty free and luxury goods trade fair is an event of international importance. Now in its ninth year, the exhibition is an ideal opportunity for product suppliers to meet up in a relaxed professional atmosphere with senior buyers from the world’s top travel retail outlets.

EVENT NAME: CABSAT WEBSITE: CABSAT.COM DATE: 28 FEBRUARY–1 MARCH, 2012 VENUE: DUBAI INTERNATIONAL CONVENTION & EXHIBITION CENTRE CABSAT is a respected trade platform for the digital media and satellite sectors across the Middle East, Africa, and Southern Asian regions. In 2011 a total of 770 exhibitors from 55 countries participated in the event. This year will be even bigger as 90 per cent of the exhibition space has already been sold out.

EVENT NAME: GESS 2012 WEBSITE: GESSEDUCATION.COM DATE: 28 FEBRUARY–1 MARCH, 2012 VENUE: DUBAI WORLD TRADE CENTRE The Gulf Educational Supplies & Solutions exhibition is the only one of its kind in the region. It focuses on the entire range of educational supplies and solutions. The event introduces education experts to the latest initiatives in teaching and helps them connect with local and international suppliers. Portfolio


London N14 4YZ

The campus currently provides 15,663 sq.m (168,596 sq.ft) of site area and approximately 29,925 sq.m (321,993 sq.ft) of total floor space. Subject to receiving the necessary consents, there is an opportunity to retain and enhance the setting of the listed buildings, whilst demolishing and relocating established foot-print to less sensitive parts of the site. Likely to be of interest to developers and owner occupiers.

An important Grade II listed Mansion House with ancillary buildings, set in parkland grounds of 21 ha (51.89 acres), within 380 ha (940 acres) of Country Park. For more information visit www.trentparkcampus.com Simon Hodson +44 (0)20 7087 5533 simon.hodson@eu.jll.com James Cobb +44 (0)20 7087 5552 james.cobb@eu.jll.com

Freehold with vacant possession. Bid date 30th March 2012


Observer

15

BUSINESS NEWS IN BRIEF

Smartphones, especially when they are used to watch videos, cause a huge amount of traffic and eat up bandwidth.

Bandwidth Crunch A recent study has found that the top 10 per cent of users are consuming 90 per cent of wireless bandwidth, reports Kevin O’Brien. THE WORLD’S CONGESTED

three per cent of heavy users generated

a third were using a smartphone and

mobile airwaves are being divided in a

40 per cent of network traffic. Now, Arieso

three per cent had an iPad.

lopsided manner, with one per cent of

said, these users pump out 70 per cent of

consumers generating half of all traffic,

the traffic.

according to a British study. The top 10 per

consumption is another example of a relatively small group of individuals

cent of users, meanwhile, are consuming

officer at Arieso, said the study did not

dominating the consumption of a

90 per cent of wireless bandwidth.

produce a more precise profile of extreme

particular resource. The United States,

users. But the group, he said, was

with less than five per cent of the world’s

advises mobile operators in Europe, the

probably diverse, with a mix of business

population, consumes about 23 per

United States and Africa, documented the

users gaining access to the internet

cent of the world’s daily oil production,

statistical gap when it tracked 1.1 million

over a 3G network while travelling, and

according to US government figures.

customers of a European mobile operator

individuals with generous or unlimited

Japan, Germany and Italy, whose

during a 24-hour period in November.

mobile data packages watching videos, the

populations together make up less

main cause of the excess traffic.

than four per cent of the world’s total,

Arieso, a company in England that

© 2012 NEW YORK TIMES NEWS SERVICE

Michael Flanagan, the chief technology

The imbalance in mobile phone

The gap between extreme users and the rest of the population is widening,

The Arieso survey found that 64 per

according to Arieso. In 2009, the top

cent of extreme users were using a laptop,

February 2012

accounted for 31 per cent of global natural gas imports in 2010, according to


Observer

16

the International Energy Agency.

dongles, or modems in a USB stick; one

Patrik Cerwall, the head of strategic

operator, Elisa, offers unlimited data plans

marketing and intelligence at Ericsson,

a research firm in Helsinki that advises

for as little as ¤5, or $6.40, a month. As

which is based in Stockholm, said most

operators on data packages and pricing

a result, Finns consume on average one

operators were beginning to look for

strategies, said the disparity in bandwidth

gigabyte of wireless data a month over an

ways to make their networks more

use was not surprising because most

operator’s network, almost 10 times the

efficient, whether by dumping data

mobile phone users globally used a 2G

European average. As more consumers

quickly into a fixed-line network,

telephone for calls and texts only.

buy smartphones, the level of mobile data

imposing volume limits on customers

consumption and congestion will rise in

or installing miniature base stations at

other countries.

congestion points.

Pal Zarandy, an analyst at Rewheel,

Just 13.2 per cent of the world’s 6.1 billion cellphones are smartphones, according to Ericsson, the leading maker

“This, of course, is bad news for

Ericsson expects the volume of global

of mobile network equipment, but the rate

operators because it means that more

mobile data to rise tenfold by 2011 to

exceeds 30 per cent in larger markets like

traffic is coming and they need to invest to

2016. The rate is likely to accelerate as

the US, Germany and Britain.

stay ahead of the curve,” Zarandy said.

more consumers integrate the mobile

The more powerful phones are rapidly

Flanagan at Arieso said one European

web into their daily lives. Last year, for

replacing the simpler, less voracious

operator, which he declined to identify,

example, 40 per cent of smartphone

devices in many countries, raising traffic

last year installed 250 miniature base

owners in an Ericsson survey used

levels and pressure on operators to keep

stations, called microcells, to handle the

their devices to gain access to mobile

pace. In countries like Sweden and

traffic of extreme users. The operator,

broadband connections even before

Finland, smartphones now account for

he said, did not wish to publicise the

getting out of bed.

more than half of all mobile phones,

work because it did not want to draw

Zarandy said. About 35 per cent of Finns

attention to the strains that its network

according to Ericsson, watched videos

also use mobile laptop modems and

was experiencing.

40 per cent of the time, surfed the web

The heaviest users of mobile data,

an additional 20 per cent, and used up the rest of their online time in emails, social networking, file sharing and software downloads. Advances in smartphones and applications technology are also driving up use. Arieso researchers, in their latest survey, found that users of Apple’s iPhone 4S downloaded 276 per cent more data from an operator’s network than did people with the Apple 3G, which has been on the market since June 2008. Part of the reason for the increase in download volumes may be Apple’s Siri voice feature on the iPhone 4S, Flanagan said. Siri allows consumers to dictate to the phone and enter more text and data into the network in an easier way. GETTY IMAGES

The growth of cloud computing-based

Laptop users are responsible for 64 per cent of excess traffic. Uploading pictures and cloud services are all contributing to high data demand.

applications like iTunes and other cloud services, which use the mobile network to connect consumers with remote computers, may also be a factor, he said. n Portfolio


Observer

18

O N E 2 W AT C H TEXT: HILDA D’SOUZA

Saudi Budget Surplus Saudi Arabia has posted a $81.6 billion budget surplus for 2011 as its income beat forecasts by more than double, official figures show. Revenues grew to $296 billion, although ministers had forecast $144 billion, according to the Saudi Arabian finance ministry. Most of the growth in revenue was driven by oil production, which accounts for around 90 per cent of the

GETTY IMAGES

country’s exports. Saudi plans to reduce spending in 2012 to $184 billion after

Scott Thompson

officials said they expect the surplus to fall to just $3 billion next year. However, analysts see this as another conservative forecast as the country has a history of using relatively low oil prices of

American Internet giant Yahoo named 54-year-old Scott

around $60 a barrel as the basis for its forecasts. The average

Thompson as its new chief executive on 9 January. The

price of crude oil in the 12 months to 26 December 2011 has been

appointment of the former president of eBay’s PayPal division

$94.96 a barrel.

came after the company fired its last CEO, Carol Bartz, in

Saudi Arabia did pump more oil in 2011 after supplies from

September for having failed at achieving significant company

Libya were disrupted by the conflict, which ended in the ousting

growth. Since Bartz’s departure the board and interim chief

of Muammar Gaddafi. The country increased production to

executive Tim Morse, who will return to his previous role as chief

10.047 million barrels per day from its planned quota of 8.05

financial officer, ran the company.

million barrels per day.

The board sees a solid manager in Thompson, capable of providing a clear goal. Yahoo’s chairman, Roy Bostock, said of the appointment: “Scott Thompson brings to Yahoo a proven record of building on a solid foundation of existing assets and resources to reignite innovation and drive growth, precisely the formula we need at Yahoo.” As president of PayPal, Thompson established PayPal as a global online payment service, expanding its user base to more than 104 million, increasing merchant partners to more than eight million, and grossing revenues of over $4 billion. Prior to PayPal he was the executive vice president at Visa’s Inovant subsidiary and chief information officer at Barclays Global Investors. The Boston-based accounting and computer science graduate faces immediate challenges such as continuing the strategic review processes set out by the board and determining the best approaches for the company and its shareholders. He’ll GETTY IMAGES

also have to restore the morale of 14,000 employees that have endured five different CEOs over the past five years, several rounds of layoffs and regular criticisms in the press for Yahoo’s slow innovation cycle.

Saudi Arabia pumped 10.047 million barrels of oil a day in 2011. Portfolio


Observer

20

Microsoft Outlook Cautious

the most recent decline in PC sales and warned that the floods in Thailand disrupting crucial disk-drive shipments would put a drag on numbers for a while, making sales hard to foresee. Reller’s cautious outlook was confirmed by industry numbers released by Gartner. The analyst firm reported a 1.4 per cent decline in global PC sales for the fourth quarter. The research firm predicted that the disk-drive shortages would be most felt in the first half of this year. Microsoft’s stock has fluctuated between $23 and $29 since May 2010, the last time they topped $30, despite hitting sales records and increases in the dividend. Pointing to the stock’s 9.7 price to earnings ratio – just over half its 10-year average – most Wall Street analysts have ‘buy’ ratings on the stock and target prices in the $30s.

AFP

The latest hopes for a share price rise are pinned on Microsoft’s

Microsoft Corp started this year much as 2011 ended – grappling

new phones – pushed aggressively at the Consumer Electronics

with weak computer sales tearing a hole in its core Windows

Show last month – and on Windows 8 later this year. However,

business, while it slowly moves into the faster-growing mobile

some industry watchers forecast that machines running

phone and tablet markets.

Windows 8 will not be on sale until early 2013, by which time

Tami Reller, the head of marketing for the Windows unit, flagged

Apple’s iPad will have almost three years’ head start.

London Targets Yuan Trading The UK Treasury has announced plans to make London the leading international centre for trading China’s currency, the yuan, also known as the renminbi. An intergovernmental agreement that London and Hong Kong would work together on yuan trading was reached last summer. According to Treasury officials, the new partnership with Hong Kong puts London in pole position to be the major centre for trading the Chinese currency outside China and Hong Kong. Following the relaxation of strict state controls, the yuan is set to become a major, globally-traded currency, in keeping with China’s status as the world’s second biggest economy. A recent report by the Chatham House think tank forecast that trade transactions settled in the currency would reach around a trillion dollars (£650 billion) by 2020. Bankers say the plans could bring billions of pounds into the City. Many analysts believe that it’s only a matter of time before the Chinese currency displaces the dollar as the world’s reserve currency – or at least becomes a major secondary reserve currency like the Euro or the yen. UK Chancellor George Osborne said the City, as the world’s in the development of this exciting market”.

AFP

largest centre for foreign exchange, was “uniquely placed to assist

Portfolio


Observer The World

Top 10

21

US Retailers Expect Modest Growth

FORTUNE 500’s 2011 RANKING OF AMERICA’S LARGEST CORPORATIONS COUNTRY Wal-Mart Stores Exxon Mobil Chevron ConocoPhillips Fannie Mae General Electric Berkshire Hathaway General Motors Bank of America Corp Ford Motor Company

PREVIOUS RANK 1 2 3 6 81 4 11 15 5 8

GETTY IMAGES

RANK 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

SOURCE: FORTUNE

FORTUNE 500: WORST PERFORMING STOCKS OF 2011* Rank 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

Name YTD stock performance YRC Worldwide -99% AMR -92% Eastman Kodak -85% Great Atlantic & Pacific Tea Co. -76% Meritor -74% OfficeMax -72% Bank of America -57% Office Depot -56% NII Holdings -55% Community Health Systems -53%

Market cap $68 million $220 million $229 million $2.7 million $503 million $432 million $58 billion $670 million $3.5 billion $1.6 billion

*(based on their closing prices as of December 9, 2011) SOURCE: FORTUNE

February 2012

in business, after moderate growth last year that was capped by a holiday season that saw shoppers spend if stores gave out bargains. The National Retail Federation forecasts that US retail sales should rise 3.4 per cent this year, down from an increase of 4.7 per cent in 2011, which came after weak sales in 2010. ShopperTrak, a data firm that makes sales projections based on foot traffic, expects sales to be “on par” with 2011 levels. Customer Growth Partners gave a preliminary forecast of five per cent to six with an expected 5.6 per cent for last year.

FORTUNE 500: TOP-PERFORMING STOCKS OF 2011* Name YTD stock performance WellCare 93% El Paso 81% MasterCard 69% BioGen 69% VF Corp. 62% Humana 56% Oneok 55% Ross Stores 50% Targa Resources Corp 48% Centene 48%

emerging that this year will again bring a slow but steady increase

per cent growth for 2012, including e-commerce. That compares

*(based on their closing prices as of December 9, 2011) SOURCE: FORTUNE

Rank 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

It looks like 2012 will be fairly similar to 2011. A consensus is

Market cap $2.2 billion $19.2 billion $43.8 billion $26.6 billion $14.4 billion $13.8 billion $8.4 billion $10.5 billion $1.6 billion $1.8 billion

The November-December holiday selling season came in better than most analysts had expected, with sales rising 4.1 per cent, excluding cars, fuel and restaurants, according to the National Retail Federation. That exceeded the retail trade group’s initial forecast of a 2.8 per cent increase. Still, the single biggest impediment to a sizeable jump in retail sales is the anaemic growth in job creation. The US job market perked up in December, creating 200,000 jobs, but at 8.5 per cent, unemployment is still far above levels that would allow for meaningful recovery in consumer spending. That is bad news for export driven countries such as China, which need the demand from American consumers.


Commentary

22

HELEN PIDD

Berlin Football Club Sells Out to Fans STANDING IN THE MUD OUTSIDE FC Union’s woodland stadium, Frank Fritz reflected on the sacrifices he has made for his favourite football club. “I spent a hundred hours here pouring concrete,” he said, pointing to the steps on the western stand. “Two weeks’ holiday it took, including weekends.” But it was worth it, said the 45-year-old Berlin refuse collector. Fritz was one of more than 2,000 Union fans who gave their time to rebuild the club’s worseGETTY IMAGES

for-wear ground when it became clear the team could not afford the renovations itself. Now, Berlin’s ‘other’ football side, the down-at-heel rival to footballing heavyweight Hertha Berlin, has gone one step further and is asking fans not just for

Each share costs ¤500 – a snip for a

ground seats 74,500 fans, protected from the elements by a state-of-the-art glass roof. Thirty kilometres east in working

their time but for their money. The club

Glazer or a Sheikh Mansour, but a lot

has been selling 10,000 shares in the Alte

for Fritz, who queued up in the cold to

Köpenick, second division Union play in

Försterei (Old Forester’s House) stadium

become one of the first fans-turned-

the Alte Försterei, which resembles a pre-

in the east Berlin district of Köpenick,

shareholders. “I’m paying in instalments,

Hillsborough second division ground –

allowing fans to have a say in how the

five lots of ¤100,” he said.

mostly standing room only, with an eight-

ground develops in the future. The shares

Tobias Hellweg, a 21-year-old electronic

foot wire fence to deter pitch invasions.

cannot be bought en masse by an oil-rich

engineer, said he had blown an entire

At halftime fans buy ¤2 Eberswalder

sheikh or an American family looking for

month’s spending money on his share.

sausages – a local brand which sponsors

a neat investment. No one can buy more

“But it’s worth it. I wanted to be a part

the scoreboard.

than 10, and to invest, you have either to

of what makes Union Union (and not

be a club sponsor, or a club member.

Hertha) – its togetherness with the fans.”

But most Union fans want to keep things lowkey. “In England, football isn’t

Talk to any Union fan about what

football any more,” said Nils Ludewig, 24.

not a first. Several British clubs, including

makes their club special and they are

“You can’t stand any more, you can’t wave

FC United and Ebbsfleet United have

likely to draw an unfavourable comparison

big flags. It’s all about the money.” Even

experimented with fan ownership, and

with Hertha BSC, which competes in

Hamburg’s St Pauli – a Bundesliga team

German clubs have historically required

the top flight Bundesliga. Comparison

with a punk rock attitude usually held up

a minimum 51 per cent ownership by

between the two clubs illustrates perfectly

as the ultimate example of a football club

members – the 50 plus one rule. But what

the chasm which still exists in many walks

with soul – is dismissed by many Union

makes Union’s stance rather unusual is

of German life between the east and west

fans as “too commercial”.

the way it is soliciting for shareholders.

of the country, 21 years after reunification.

Letting fans own a piece of their club is

© 2012 GUARDIAN NEWS SERVICE

Red Bull, Silvio Berlusconi and Sepp Blatter.

“We’re selling our soul – but not just to

In the leafy far reaches of west Berlin

“At Hertha, fans are happy only if they’re winning. At Union, we celebrate whether we

anyone,” proclaim posters on billboards

stands the Olympic stadium, built by Hitler

win or lose,” said Hellweg. Fritz said that a

around former east Berlin, featuring

for the 1936 Games and now home to

game at Hertha is all about the “event” – “At

pictures of unwelcome investors, including

Hertha. After extensive renovations, the

Union it’s all about heart and soul”. n Portfolio


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Profile

24

Portfolio


PHOTOS: GETTY IMAGES

February 2012

ONCE AN UNLIKELY RIVAL FOR HP AND APPLE, CHINESE COMPUTER MAKER LENOVO HAS GROWN AND ADAPTED AS QUICKLY AS ITS HOMELAND THANKS TO DYNAMIC LEADERSHIP BY CEO YANG YUANQING AND FOUNDER LIU CHUANZHI. NOW, WITH A SAVVY BLEND OF EAST AND WEST, IT’S POISED TO BE CHINA’S FIRST GLOBAL BRAND, REPORTS CHUCK SALTER.


Profile

26

J

UST WEST OF THE BIRD’S

entire world, and roughly 14,700 more

which generated about 70 per cent of its

Nest, that architectural jewel

stores than Apple has.

$21 billion in revenue last year. On the

of the 2008 Summer Games

For the past two years, Lenovo has

attack side, he’s pumping Lenovo’s profits

in Beijing, rises an electronics

been the fastest-growing company in

- $273 million in 2010 – into emerging

district of Olympic proportions.

the PC industry. In the third quarter of

markets, new product categories (tablets,

It’s called Zhongguancun, and

2011, it sold a record 13.5 per cent of PCs

smartphones, smart TVs), and, of course,

if you need any digital device

worldwide, leapfrogging Dell and Acer

the US.

when in China’s capital, this

to seize the No. 2 spot. (Only HP sells

Lenovo is a company the likes of

is the place to go. It’s like a year-round

more.) Dominating China has much to

which we’ve never seen. It is a product

Consumer Electronics Show, with every

do with Lenovo’s success; the rising super

of Communist China (the government

major brand vying for attention.

economy became the world’s largest PC

still owns 36 per cent of its parent,

market last year.

Legend Holdings); it is heavily influenced

But one brand is nearly ubiquitous: Lenovo. Here in Beijing’s high-tech

“This is Lenovo’s moment,” says CEO

by the democratised West; it boasts

centre, the Chinese computer maker

Yang Yuanqing, 47, a former salesman

an international workforce of 27,000

has 100 stores in just this one shopping

who once delivered computers by bicycle

employees and customers in more than

area. Outside the Zhongguancun towers,

and is now China’s highest-paid chief

160 countries. But the story of Lenovo’s

a Times Square-size digital screen

executive. (His 2011 salary: $12 million.)

rise is also a parable for Chinese business:

continually plays the company’s ads. A

Yang calls Lenovo’s strategy “protect and

In just 30 years, an enterprise launched

third of the computers sold in the district

attack,” three words you hear repeatedly

in the Beijing equivalent of a garage has

are Lenovos, roughly approximating its

at the company’s headquarters in Beijing

blossomed at a pace no one predicted.

market share in the whole of China, where

and its offices in Raleigh, North Carolina,

Lenovo is redefining ‘Made in China,’

it is by far the No. 1 seller of PCs. Its

where Yang spends a third of his time.

producing the industry’s highest-quality

network of 15,000-plus stores reaches into

Lenovo seeks to protect its core business

machines; it ranked No. 1 in the 2011

the most remote of villages. That’s almost

– the China and enterprise (large-scale

Computer Reliability Report, ahead of

as many locations as Starbucks has in the

commercial and public-sector) markets,

Apple and HP. And the company’s culture

Liu Chuanzhi, the founder of Lenovo, promoted Yang to head the personal computer business at just 29 years old. Liu described Yang as “A man who moves forward, takes risks and aims to innovate.”

Portfolio


27

skilfully blends an Eastern way of thinking with the best of Western business. A few miles north of the Zhongguancun shops, on the top floor of a gleaming Beijing tower, Lenovo founder Liu Chuanzhi meets me in the Legend Holdings’ offices. Liu, who is 67, is known to Lenovo employees as Chairman Liu, or simply the Chairman, an honorific that echoes that of another Chinese leader, Mao Zedong. Throughout his homeland, Liu commands respect akin to Henry Ford in the US, and his journey reflects the evolution of his country. After graduating from a military college in 1968, he was assigned by the government to be a researcher for the Ministry of Defence. That same year, the Cultural Revolution upended his life. Mao sent young graduates like Liu, the son of a banker, to be “re-educated” in the countryside. After Mao declared

Lenovo’s strategy of building high-powered machines at a competitive price has made it the world’s second biggest PC maker. Only HP sells more.

the end of the Cultural Revolution, Liu was assigned to the Chinese Academy

institute in Beijing. He felt fortunate not

developed a Chinese-character card

of Sciences, a government research

to be consigned to a factory but still felt

that made foreign PCs accessible to

caged – “There was no shifting jobs,” he

Chinese-language users.

“When Yang took over the PC unit, he focused on speed, inspired by what he saw at Lenovo’s more-experienced foreign partners. In 1996, Lenovo was the first in China to offer a Pentiumpowered machine – at a lower price than the competition was asking for slower PCs.” February 2012

says – until an unexpected door opened

Liu forged a partnership with the

in the early 1980s. With Mao dead and

US company AST, which became

Deng Xiaoping in power, the academy’s

China’s top-selling brand. Then, in

president was encouraged to find ways to

1990, despite misgivings from AST,

help the economy. He made a visit to IBM

he launched a Legend-branded

– prophetic, it would turn out – where he

PC. Business flourished – until the

saw how R&D fuelled growth. Upon his

government changed its rules again.

return to Beijing, he encouraged his staff

In 1991, Chinese tariffs on foreign

to turn their research into businesses. Liu,

computers were lowered, eventually

then 40, says he felt like “a person who

spawning an influx of competitors. Liu’s

has experienced starvation and suddenly

company stumbled, losing money for

you’re presented with steak.”

the first time. His health faltered and

I

he wound up in the hospital, where

Research Institute New Technology

managers, a 29-year-old named Yang

Development Co. The name was as

Yuanqing, in charge.

n 1984, he and 10 colleagues, armed

his managers visited his bedside and

with about $25,000 from the academy,

discussed how to save the company. The

started the Chinese Academy of

answer, Liu decided, was to reorganise

Sciences Computer Technology

its PC business and put one of those

cumbersome as the group was clueless

When Yang took over the PC unit, he

about business. Based in a cramped

focused on speed, inspired by what he

guard shack on the outskirts of Beijing,

saw at Lenovo’s more-experienced foreign

the company – which changed its name

partners. In 1996, Lenovo was the first

to Legend and in 2004 to Lenovo –

in China to offer a Pentium-powered


28

“Chairman Liu had long dreamed of building a global company. So, in 2005, Lenovo paid $1.75 billion for IBM’s PC business, a stunning move that the Chinese media described as a snake swallowing an elephant. But it also created a corporate marriage of immense complexity that, initially, did not go well.” Lenovo founder Liu Chuanzhi (L), together with CEO Yang Yuanqing, announced another record year on 2 November 2011 in Beijing. Lenovo Group gained 59.8 per cent year-on-year to $948 million in second quarter profit.

many forms. Lenovo is slashing the delivery time to Dubai from eight weeks to four, thanks to a new, well-placed distribution centre. Its LePhone A60,

machine – at a lower price than the

complexity that, initially, did not go well.

Lenovo’s new smartphone in China, took

competition was asking for slower PCs.

IBM’s PC unit had $10 billion in revenue,

less than six months to develop, half the

but it was losing money. Lenovo was

typical cycle.

“Our orders, um, how you say…”

Speed is highly valued in Lenovo’s

Yang says, turning to Lawrence Yu, his

profitable but generated less than a third as

executive assistant, who graduated from

much revenue and was run by executives

decision-making process as well. Two

Harvard Business School. “Surge,” Yu says.

who didn’t speak English and had zero

years ago, Yang streamlined the company’s

“Yes, surge,” Yang says, smiling.

multinational experience. Deciding that

senior leadership team from more than

Westerners were better equipped to take

two dozen members to nine.

As the PC giants released a comparable

The emphasis on speed at Lenovo

product in China, Lenovo moved on to

their creation to the next level, Liu and

the next-generation chip. Another surge.

Yang stepped back, handing the CEO

is particularly compelling because it’s

And on it went. “There’s no way they

title first to IBM vet Steve Ward and

twinned with a deliberate effort to slow

can catch up,” he recalls, punctuating his

then to former Dell exec Bill Amelio. The

other things down. Upon his return as

accented but nearly fluent English with

experiment floundered. The Americans

chairman, Liu emphasised a concept

his trademark laugh. By 1997, Lenovo

couldn’t bridge the culture gap with

called fu pan. It means ‘replaying the

was China’s top-selling PC maker, a

Beijing, and during four difficult years of

chess board.’ The idea is to examine your

position it still holds.

cost cutting, morale plunged. Then the

every move to improve the next time.

C

2008 financial crisis devastated Lenovo’s

Lenovo trains its managers in fu pan,

hairman Liu had long dreamed of

enterprise business. The company posted a

which can entail short reviews of an

building a global company. So, in

$226 million loss, its biggest ever.

incident from that workday or a far more

2005, Lenovo paid $1.75 billion for

So, in 2009, Yang and Liu reclaimed

in-depth process. CFO Wong Wai Ming

their previous roles, and Yang launched

told me: “The most dangerous thing is

that the Chinese media described as a

his protect-and-attack strategy to forge a

to be successful. You then think every

snake swallowing an elephant. But it also

return to profitability. The key to success,

decision is the right one. That’s why you

created a corporate marriage of immense

says Yang, remains speed, which takes

have to review what you do.”

IBM’s PC business, a stunning move

Portfolio


O

ne Sunday morning last September,

marketing plans. “The brand is definitely

the US and Europe, and China is going

Yang takes the stage in a ballroom

the most important area,” says Yang.

to have a number of those,” says Roman.

Enter David Roman, whom Yang

“The opportunity to be in the driver’s seat

successfully recruited as CMO in 2010.

for maybe the first one is very compelling.”

of Lenovo’s top 100 executives from

Roman earned a reputation as a stellar

At Lenovo, his challenge isn’t changing

around the globe. Yang, normally low-

marketer at Apple and then at HP. “There

consumers’ perception of a brand. It’s

key, sounds like a coach giving a pep talk:

are going to be global brands from outside

introducing a brand and having it resonate.

at the Ritz-Carlton Hotel in San Francisco for an annual gathering

Dell has no clear strategy! HP’s future is anybody’s call! “We must attack the market without hesitation!” he exclaims. “Right, team?” “Yes!!!!” the Lenovo execs roar. The resounding chorus reflects an intense, even militaristic camaraderie that has taken root in the past two years. Company unity has always been a priority for Chairman Liu. But maintaining that ethos has been a challenge since the IBM purchase, especially as Lenovo’s ranks diversified. The execs in San Francisco represent 14 nationalities. Yang recognises that integrating non-Chinese perspectives and talents is critical to Lenovo’s success. For example,

Last spring, for its first-ever global

“When I first met Yang, he told me: “You should visit a very small city. You cannot find an Apple store in a small city or town. You cannot find a Dell or HP. But when you go to rural areas, you can find Lenovo everywhere.”

non-Chinese talent is crucial to their

branding campaign, Lenovo selected Saatchi & Saatchi’s concept: ‘For Those Who Do’ to spotlight how people use its computers. When we meet in Lenovo’s North Carolina office, Roman is typically blunt. “Lenovo hasn’t been a marketing company,” he says. “Its heritage is as a production and distribution company.”

W

hen I first met Yang, he told me: “You should visit a very small city. You cannot find an Apple store in a small city or town. You cannot

find a Dell or HP. But when you go to rural areas, you can find Lenovo everywhere.” I travelled to Da Longhua where the only apples in this village are sold at the local market. Lenovo advertises with a character painted on the concrete wall of a junkyard and has a shop on the side of a two-lane highway. None of the five PCs on the shelves has a price tag. Gao Hua, who runs the shop, says one isn’t necessary. His customers all know and trust him. The week I visited, Gao had sold all-inone desktops to three families on market day. “They sit down and ask, ‘What do you suggest?’” Gao says. “Five minutes, it sells.” The rural market holds huge growth opportunities for Lenovo, which already posts annual China revenue north of $10 billion. More than half of China’s 1.3 billion residents live outside the cities, and the country’s rapid economic growth is gradually reaching them – as is broadband access. The majority of Lenovo’s Chinese outlets are in rural areas, poised to sell computers to the millions who have never owned them. Today it’s their first PC, tomorrow their first tablet or smartphone.

Lenovo has more than 15,000 stores in China, which is almost more than Starbucks has worldwide. Apple has around 300 stores. February 2012

And Lenovo expects this pattern will repeat itself in other emerging markets. n

Profile

29


30

A COMIC KILLS THE TV MIDDLEMAN American funnyman Louis C.K. decided to release his latest comedy show directly on the web for $5 with no middleman involved. Fans could have pirated it, and some did, yet a large number paid up, reports David Carr.

L

OUIS C.K. IS SOMETHING of a pirate in the entertainment world, a man who has ignored

the rules on his way to building a huge comic franchise. So it’s odd to see him put one of his shows for sale on the web and politely ask fans not to rip him off. The weirder thing? It seems to be © 2011 NEW YORK TIMES NEWS SERVICE

working. A scabrous and successful champion of the everyman, Louis C.K. decided in early December to go direct with his fans: no cable special, no middleman, just a simple download for $5 on his website to see his comedy show Louis C.K.: Live at the

Beacon Theatre. The show could be viewed as the consumer wished, with no rights protection and no expensive subscription. A buyit-and-watch-it proposition, no cable company involved. He was also, of course, enabling people to watch it free – without digital rights management, it was there for the pirating – and some went right to the torrent sites and did so. But many, many other people paid the fiver and got a package of two streams and three downloads, which could be burned to a DVD or streamed on a smartphone and wherever else they felt like watching it.

Louis C.K. is a freak about doing it himself. He writes, directs, produces and acts in his own series, Louie, then edits it himself with Final Cut Pro on his Mac. And now the king of DIY has one more credential: distributor. “I went at this like a consumer, just looking at human impulses,” he told me. “I buy lots of things online and I had a focus group of one. I thought about it, and five bucks seemed almost free and I figured if I took out the hassle, most of the speed bumps, it would almost be like hitting a link and streaming it. It’s been pretty great so far.”

Portfolio


understanding of the web and what it

going to have to pay Verizon FiOS for my

checked his website and about 175,000

could mean for content providers and

cable feed, which in turn pays Showtime.

people had bought his special through

consumers.

While I was talking with him, he

PayPal. He expected 200,000 total

“OK, so NBC is this huge company

In fact, I wouldn’t know anything about Louis C.K. if it weren’t for cable. I DVR’d

downloads by that weekend, which meant

and they have all these studios and these

his freakishly hilarious series Louie on

he would have grossed $1 million. After

satellites to beam stuff out,” he said,

FX, which is owned by News Corp., and I

covering costs of about $250,000 for the

“but on the web, both NBC.com and

saw his last two comedy specials on cable.

live production and the website, that’s a

LouisCK.com have the same amount of

The people who helped build the brand

$750,000 profit. And he owns the rights,

bandwidth. We are equals and there are

of Louis C.K. might wonder about his

and the long tail of buyers, in perpetuity.

things you can do with that. This has been

decision to go native (digitally), but hey,

The transparency of the enterprise,

a fun little experiment.”

it’s the internet: it’s every man, woman,

including its cost in relation to how many

It may be little, but it has significant

people bought in, was widely covered by

implications, pointing a way forward for

the media.

performers and the consumers who want

“It feels weird having numbers out there,

to pay for their work.

because that’s my personal income,” he

producer, consumer, company and cable outfit for itself! “I am not sticking it to the Man,” he said. “There is no the Man in this story and if there were, he would be like a kindly old

said. “But I talked to my mom, who is a

TELEVISION FACES threats from

father. HBO gave me a half-hour comedy

pretty judicious, careful person, and she

many sides, including from people who

show, a series that I had complete control

said, ‘Tell them everything. Just let it all get

are cutting their cable cord and watching

over, and then a full-hour comedy special.

out there.’ So that’s what I have been doing,

programming over the web, as well as

They have been nothing but great to me.

at least so far.”

any number of web-based programmers

“But they don’t really want what I have

Louis C.K. has been doing comedy

like YouTube, Netflix and Amazon. But

any more,” he said. “Comedy specials are

since 1984, when he took a break from

network and cable television’s big hedge

just like grist to the mill to them, so I

working on cars to try stand-up. He didn’t

against insurgent technologies has always

thought it was time to try something else.”

go to college, is not deep into technology,

been its stranglehold on programming

(He added that Louie would still be on FX

and doesn’t think of himself as any sort

and talent. If I want to see how Homeland

as long as the channel wanted it. “I am

of pioneer. But he has a fundamental

ended and am not willing to steal it, I’m

completely loyal to them,” he said.) Going through a middleman to put out a televised version of his latest stage show clearly rankled Louis C.K., who is used to getting in front of an audience and daring them not to laugh. Besides, some of the

REUTERS

economics of dealing with cable bugged

Traditional TV networks have always shouldered the overheads and dictated the programming. But by selling directly to the public, Louis C.K. has cut out the middleman and taken on both the costs and the profit. February 2012

“There is no the Man in this story and if there were, he would be like a kindly old father. HBO gave me a half-hour comedy show, a series that I had complete control over, and then a full-hour comedy special. They have been nothing but great to me.”

Media

31


Media

32

experiment a success. “I’m really glad I put this out here this way and I’ll certainly do it again,” he wrote. “If the trend continues with sales on this video, my goal is that I can reach the point where when I sell anything, be it videos, CDs or tickets to my tours, I’ll do it here and I’ll continue to follow the model of keeping my price as far down as possible, not over marketing to you, keeping as few people between you and me as possible in the transaction.” Louis C.K.’s ability to hack his own route to his public brings joy to the web-inclined – “Louis C.K. wins everything ever,” said REUTERS

the wags at Vulture, New York magazine’s website – but will seem less charming to Television faces threats from many sides as people choose watching programming over the web or using web-based providers such as YouTube.

the cable outlets who teamed up with him and helped build him into a juggernaut. But his exalted status, of course, did not

him. He was paid a fee upfront and the

you either have to be a sociopath or view

derive from his exposure on cable, but

cable outfits shouldered the costs, but he

the act differently.”

from the fact that he is one of the funniest humans on earth.

had no participation in the backend – DVDs, on-demand and reruns.

BY PUTTING a face on the content, Louis

“This is not about cable, it’s about

C.K. changed the subject from whether it is

concerts,” he told me. “I have been out on

OK to game a big corporation to whether

the road for a long time selling tickets, and

it’s morally appropriate to simply take the

me and the people I work with aren’t that

stiff, a 44-year-old divorced father of

work of an artist that other people have

surprised, to be honest. We knew people

two who tells jokes and is just trying to

paid for.

would buy it. People have been paying for

“I’ve never seen a cheque from a comedy special,” on television, he said. Louis C.K. portrays himself as a working

make his way, but he’s displayed a great

On his site recently, he declared the

what I do for a long time now.” n

deal of digital savvy. He carefully built a simple user-friendly site to facilitate the transaction. His default setting for whether a customer wanted additional product information from Louis C.K. was “No. Leave me alone forever, you idiot.” The download of the Mp4 to my laptop took under four minutes and I still had two streams and two downloads left. (I watched one of the streams on my iPad at bedtime.) When he began the experiment, he did a Q and A on the website Reddit, a great place to address those inclined toward piracy. “I think it is really interesting that I brought the price so close to stealing and made the movie so easy to get and made it so clear that it’s a human offering that it sparked a debate about pirating,” he wrote. “To steal from someone and not feel bad,

Louis C.K.’s website takes a no frills approach, keeps it simple and gets his humour across. Portfolio


Energy

34

DRILLING IN A THIRSTY LAND Energy companies want to drill gas wells in South Africa’s arid Karoo region using hydraulic fracturing. But this method uses huge amounts of water and chemicals and has met local opposition, reports Ian Urbina.

C

of natural gas wells in the region, using a

roughly 1,300 kilometres

new drilling technology that can require

said Chris Hayward, 51, a brawny, dust-

between the South African

3.7 million litres of water or more for each

covered farmer in Beaufort West, quoting

cities of Johannesburg and Cape Town,

well. Companies will also have to find a

a Karoo saying about how rare and fleeting

the arid expanse of the Karoo – its name

way to dispose of all the toxic wastewater

precipitation is in the area. With his

means ‘thirsty land’ – sees less rain in some

or sludge that each well produces, since the

three skinny border collies crouching

parts than the Mojave Desert.

closest landfill or industrial-waste facility

dutifully at his side, Hayward explained

that can handle the waste is hundreds of

that he had to slaughter more than

kilometres away.

600 of his 2,000 sheep in 2011 because

Even so, Shell and several other large energy companies hope to drill thousands

© 2012 NEW YORK TIMES NEWS SERVICE

“Around here, the rain comes on legs,”

OVERING MUCH OF THE

The Karoo is an environmentally-sensitive region in South Africa with very little rainfall. Portfolio


there was not enough water to go around. “If our government lets these companies touch even a drop of our water,” he said, “we’re ruined.” South Africa is among the growing number of countries that want to unlock previously inaccessible natural gas reserves trapped in shale deep underground. The drilling technology – hydraulic fracturing, or ‘fracking,’ for short – holds the promise of generating new revenue through taxes on the gas, creating thousands of jobs for one of the country’s poorest regions, and fuelling power plants to provide electricity to roughly 10 million South Africans who live without it. But many of the sites here and on other continents that are being considered for drilling by oil and gas companies and by governments short of cash are in fragile areas where local officials have limited resources, political leverage or experience to ensure that the drilling is done safely. THE INTEREST from big energy companies in South Africa and elsewhere means that shale gas may redraw the global energy map, according to many energy experts. Michael Klare, a professor of world security studies at Hampshire College, said that the new sources of natural gas from shale may lessen the geopolitical importance of countries that historically

REUTERS

have been the biggest producers of natural

Fracking is a new technology enabling the exploitation of shale gas. But it uses large amounts of water and chemicals and has aroused controversy both in the US and abroad. February 2012

“The big problem is that all the excitement around shale gas, most of it fostered by the US, has also led some countries, especially in the developing world, to take a drill-first, figure-out-regulationslater attitude.”

Energy

35


Energy

36

technologically to extract that gas in a way that is entirely safe,” Obama said in a speech last May in Warsaw, where the US Embassy co-hosted an international shale gas conference. The US Geological Survey has offered training and technology to geologists exploring shale gas in Europe. The State Department’s Global Shale Gas Initiative, begun in 2010, has been advising many foreign countries on fracking. It had organised a half-dozen trips in 2011 for foreign officials to meet with US energy experts and to visit drilling sites in the US. The website for the initiative says that its primary goals are “to achieve greater energy security, meet environmental Trenly Spence, a Karoo farmer, is worried that drilling for shale gas could mean the end of the farm that has been in his family for generations. But South Africa also has a huge need for energy and jobs.

objectives and further US economic and

gas, including Iran, Qatar and Russia.

invented, the government is taking a lead

say that while the governments of poorer

role in supporting the dissemination of the

countries may benefit from the new tax

technology abroad.

revenues and jobs, they may not be paying

The new drilling, which draws strong support from the United States government, represents a boon for US

Over the last three years, President

commercial interests.” Some economists and environmentalists

enough attention to the environmental

companies like Halliburton, Chesapeake

Barack Obama has promoted shale gas

risks of drilling. They also note that local

Energy and ExxonMobil that have

during visits to China, India and Poland.

residents – who bear the brunt of the air

greater experience with shale gas, and

“We believe that there is the capacity

pollution, potential water contamination

therefore are likely to win many lucrative contracts abroad. More than 30 countries, including China, India and Pakistan, are now considering fracking for natural gas or oil, and the surge in gas production has spurred interest in building pipelines and terminals that liquefy the fuel so

Major Shale Gas Deposits With help from an independent contractor, federal energy officials have mapped the sites of some of the world’s largest shale gas resources. The study was limited to about 32 countries for which there was enough geological data to produce informed estimates.

it can be shipped to far-flung markets. But the enthusiasm abroad, especially in less-developed regions, does carry risks, according to many energy experts. “The big problem is that all the excitement around shale gas, most of it fostered by the US, has also led some countries, especially in the developing world, to take a drill-first, figure-outregulations-later attitude,” said Klare, who has written extensively about the way that energy policies affect global security.

Assessed shale basins

Karoo Region

SOUTH AFRICA

IN THE United States, where the waterintensive drilling technique of fracking was

Source: Energy Information Administration

THE NEW YORK TIMES

Portfolio


Spence added that farmers had been frustrated by the lack of information from Shell officials about the chemicals they would inject into the ground during fracking. Shell officials said that they would disclose what they could about fracking formulas if they started drilling, but that they might be limited by trade secrets of their subcontractors. In the US, some drilling companies have been reluctant to reveal the chemicals they use in fracking, saying the information is proprietary. Some legal experts say that the US needs GETTY IMAGES

to be more concerned about environmental and other impacts as it promotes energy technology abroad.

Contaminated water from fracking has to be treated. The problem with the Karoo is that the nearest facilities are hundreds of kilometres away.

David Hunter, director of the Program on International and Comparative Environmental Law at American

from spills or underground seepage, and

But in this sun-flooded hinterland,

University, said, “Especially with

truck traffic that come with drilling – may

where sheep outnumber humans and rusty

energy projects, the US and its funding

see few benefits.

windmills pumping water dot the horizon,

institutions have a habit of promoting

“These projects have already started

many residents say they would prefer to see

policies that foster a stable climate for

causing steep inflation in costs of local

the government bring in large wind or solar

foreign investors but that are not in the

housing and services, and except for the

farms, not new drilling.

best interests of local populations.”

lucky few who get temporary construction

“It just takes one big spill, leaky pipe

In South Africa, pressure is mounting

jobs, the economic conditions for local

or crack underground that their studies

to proceed cautiously. After public

communities can actually get worse,”

didn’t catch, and a farm my family has

concerns were raised in 2011 about

said Doug Norlen, policy director of

run for four generations is done,” said

drilling in the Karoo region, South

Pacific Environment, an advocacy

Trenly Spence, 44, as he dug up a clogged

African drilling officials set a moratorium

and research organisation that tracks

irrigation pipe that carries water across his

on new licenses for exploration until

federal and corporate financing of energy

1,335 hectares to where his 3,000 sheep

February so the government could

projects abroad.

and goats graze.

conduct more research.

“These projects have already started causing steep inflation in costs of local housing and services, and except for the lucky few who get temporary construction jobs, the economic conditions for local communities can actually get worse.”

Authority of South Africa, an independent

In July, the Advertising Standards BUT JAN Willem Eggink, general manager for Shell in South Africa, said that the Karoo project could eventually produce millions of dollars in direct investment and thousands of jobs for South Africans, which would help lower the nation’s unemployment rate of about 25 per cent. “There is a huge energy problem looming for South Africa,” he added, explaining that energy demand is growing rapidly and that shale gas coupled with renewable energy resources could help meet that new demand while also lowering the nation’s dependence on Mozambique for gas. February 2012

agency that sets guidelines for media companies, ruled that several of Shell’s advertised claims – including one that said fracking had never led to groundwater contamination – were misleading or unsubstantiated and should be withdrawn. Shell said the advertisements were an accurate reflection of its opinion. “The government is under a great deal of pressure to hurry up,” said Hein Rust, director of disaster management for the central Karoo region. “But I don’t think these decisions should be made on faith or until all the costs are known.” n

Energy

37


Hospitality

38

HOTELS TARGET UPGRADES

During the recession when travellers cut back and credit was tight, many hotels skimped on renovations. But now there’s an upswing in the hospitality industry and discerning travellers are demanding better amenities, reports Martha White.

A

s hotel bookings and prices

they collectively spent in 2008. Still, it

climb from their recession-era

is the first increase after two years of

troughs, many chains are taking

reduced spending.

on the renovations they postponed when money was tight. Many hotels may not have much

company who spends a week a month

choice. Travellers paying higher room

on the road, say they have noticed the

rates are less likely to overlook a worn

deterioration in the quality of items like

carpet or scratched credenza. In addition,

bed linens over the last couple of years.

hotel consultants and management

“When you’re afraid to throw your head

companies say 2012 could be a make or

on the pillow, that’s a bit of a problem,”

break time for hotels to renovate or lose

Dean said. “White sheets over time get

competitive ground.

greyish-brown. They just needed new

According to the latest figures, hotels were expected to spend $3.5 billion in 2011 © 2012 NEW YORK TIMES NEWS SERVICE

Travellers like Shawn Dean, a sales executive for a management training

ones,” he said of a recent hotel stay. Jack Kramer, vice president for field

to upgrade items including sheets, pillows,

operations of Skill Survey, a company

lobby design and decor, 30 per cent more

that provides online reference checks of

than in 2010, according to Bjorn Hanson,

potential workers to employers, said he,

divisional dean of the Preston Robert Tisch

too, had detected a decline in quality.

Centre for Hospitality, Tourism and Sports

“When you walk into a room and the

Management at New York University.

bedspread has been on there for nine

But that is still far from the $5.5 billion

years, you can tell it’s just tired,” he said. Portfolio


Hotel management companies favour complete renovations, as step-by-step renovations diminish the impact of a complete overhaul.

February 2012

Hospitality

39


Hospitality

40

A maintenance worker does a repair in the temporary lobby at the Radisson Hotel Boston.

“A lot of the rooms in a lot of the locations

BUT THE effects of those improvements

just look tired.” As a frequent traveller,

are fading, and travellers are complaining

Kramer said he picks up on such details.

that hotel rooms, lobbies and other public

“There are a lot of properties that didn’t

spaces are showing their age. Hanson

do anything for a number of years.”

said an increasing number of travellers

Travellers said guest room televisions

had expressed discontent about shabby

and air-conditioners were also

conditions at hotels on comment cards left

increasingly showing their age, as were

in guest rooms and in reviews on travel

amenities like fitness centres. Hanson said

websites, and that was a major factor

when the recession hit, the hotel industry

prompting hotels to act.

was coming off several banner years that

“Travellers were understanding in 2009

had increased profits and provided ample

and even 2010,” he said. Unusually low

cash for improvements and upgrades.

rates made it easier for guests to overlook a

“The peak amount spent in 2008 was

bit more wear and tear, he said. But when

reflective of many enhancements,” he said.

rates began to climb last year, “Consumers

“The industry went into 2009 in the best

became less tolerant of those conditions.”

physical condition it had ever been in.”

Commercial real estate suffered losses in

Bjorn Hanson, divisional dean of the Preston Robert Tisch Centre for Hospitality, Tourism and Sports Management at New York University, says expenditure on renovation is climbing steadily again.

the economic downturn, just as residential properties did. And while the commercial real estate market has recovered somewhat, lenders remain risk-averse. Analysts say

“Analysts say banks prefer borrowers that are already well capitalised. A result is that hotel owners that do not already have a healthy balance sheet may find it difficult or impossible to borrow for renovations, and that could be a problem.”

banks prefer borrowers that are already well capitalised. A result is that hotel owners that do not already have a healthy balance sheet may find it difficult or impossible to borrow for renovations, and that could be a problem. “This year is going to be crunch time,” said Joel Ross, principal of the hotel Portfolio


Hospitality

41

REUTERS

Thorsten Kirschke, president of Carlson Hotels Americas, says it is now time for a return to business as usual with the strict implementation of standards.

The Pera Palace, once Istanbul’s grandest hotel before it slumped into disrepair decades ago, re-opened in late 2010 after a two-and-a-half year renovation. Companies that had money to spend during the recession now have an edge on their competitors.

BUT NOW, management companies want to return to business as usual. Not only are they concerned that negative traveller experiences will tarnish their image, but they are acutely aware that renovating now can give them a competitive edge as

investment company Citadel Realty

But what we have done is loosened the

travel picks up. Strong said management

Advisors, because improvement projects

implementation.”

companies do not want owners to renovate

“are way past due and people still don’t

Lisa Larson, vice president for

rooms a little at a time – curtains one

franchise operations for select service and

year, rugs the next and so on – because it

Generally, hotels have schedules for

extended-stay hotels for the Americas

diminishes what he calls the “wow factor.”

replacing bed linens, curtains and the

at Marriott International, said during

While it is more economical for hotels to

like as well as more durable items such as

and immediately after the recession, the

renovate incrementally, guests do not get

furniture. Items like carpets are typically

company gave some property owners six-

the impression that they are staying in a

replaced after about five years, while

or 12-month extensions on renovation

truly refurbished room, he said.

furniture lasts 10 to 12 years, said Greg

requirements.

have money.”

Strong, president of the hotel consulting

She and Kirschke were quick to add

“The leniency we’ve shown is not lasting forever, and it’s not meant to be abused,

management company PIP For Hotels.

that such exceptions were made on a case-

either,” Kirschke said. “The faster you come

PIP is the industry abbreviation for

by-case basis and never affected anything

back with a renovated property, the faster

property improvement projects.

involving guest safety, like elevator

you can start benefiting from the rebound.”

But in the depths of the recession, hotel

maintenance.

Larson said the hotels in Marriott’s

owners faced record low occupancies

North American portfolio were already

that reduced their income just as credit

accelerating their renovation schedule in

became almost impossible to get. As a result, hotel management companies like Marriott International and Carlson Hotels Worldwide took the unusual step of giving properties more time to make required upgrades. “Extraordinary times have demanded extraordinary measures,” said Thorsten Kirschke, president of Carlson Hotels, Americas. “You can’t waive all standards. Then you start prostituting your brand. February 2012

“Not only are they concerned that negative traveller experiences will tarnish their image, but they are acutely aware that renovating now can give them a competitive edge as travel picks up.”

response to competitive pressure. “What we are anticipating is over a 50 per cent increase in renovations in 2011,” she said. “The guys who have money are starting to do renovations because it’s the smart thing to do and get ahead of the competition,” Ross, of Citadel, said. “I feel very strongly that if you have the money, now is the time to spend it fixing up your property or buying a property and fixing it up, because your competition won’t have the money.” n


Investing

42

OPPORTUNITY & CAUTION Latin American countries, such as Brazil and Mexico, have shown strong economic growth. That has focused investor interest on the region, reports Paul Sullivan.

I

SPENT THE LATE 1990s AND early 2000s reporting on the financial crises in Latin America, when

But, at the same time, companies as diverse as Siemens, General Electric,

1980s and 1990s. Official estimates now put it at a comparatively low 6.5 per cent. What’s an investor to do, with so

Argentina, overwhelmed by foreign debts,

Nissan and Halliburton have increased

many contradictory measures? Here

defaulted and Brazil narrowly avoided the

their operations in Brazil.

are some thoughts.

same fate. But recently, Latin America

China is Brazil’s major trading partner,

has come up frequently in conversations

which would seem to augur well. But

TEN YEARS ago, Jim O’Neill, chairman

I have had with various money managers

it is selling commodities like iron ore,

of Goldman Sachs Asset Management,

and investment strategists as a place that

which could suffer if China’s growth

coined the term BRIC, elevating the

has new opportunities.

continued to slow. Yet Brazil also has a

profile of four countries – Brazil, Russia,

growing consumer sector. Sergio Cabral,

India and China – that he thought were

America is now a solid investment, as

the governor of Rio de Janeiro state, said

poised to become “growth economies.”

the middle class in many of the countries

that almost 40 million people in Brazil

He argued at the time that these countries

increasingly becomes a driving force? Or

had entered the middle class in the past

contributed eight per cent of global

is the region’s cycle of booms and busts set

five years. (Gerardo Zamorano, a director

gross domestic product and that in 10

to repeat itself?

at Brandes Investment Partners, put

years, their economies would account for

that number at 25 million to 30 million,

about 14 per cent. They’re now at 18 to

region’s main stock had a bad 2011.

which is still a striking number given that

19 per cent.

Brazil’s index was down 16 per cent,

Brazil had almost no middle class when I

Mexico’s down five per cent and Chile’s

was there.) And Cabral said that demand

surprised at how well Brazil had done,

about 16 per cent. These numbers are

for all types of consumer goods was far

overtaking Italy to become the seventh-

worse for international investors because

outstripping supply in his state.

largest economy in the world. “I found

What happened? Can it be that Latin

Anyone who invested broadly in the

all three countries’ currencies have fallen against the dollar. © 2011 NEW YORK TIMES NEWS SERVICE

taking out $36.6 billion.)

Not surprisingly, investors have been pulling their money out. As of early December they had taken $9.8 billion

“Prices are crazy,” he said on a visit

O’Neill said recently that he was

it really easy to be bullish about Brazil

to New York recently. “We need more

over the past decade,” he said. “I describe

hotels. We have a suite problem – we have

myself now as being a little bit more

demand but we need more supply.”

reserved. The biggest risk is if inflation

That is a good thing as long as inflation

were to get out of hand. There is no way

out of Latin America, according to fund

does not increase and erode the buying

you’re going to get the continued increases

flow data compiled by Morgan Stanley

power of the new middle class. Inflation

among the middle class if that happens.”

research. (Emerging markets in general

has historically been a huge problem

did not fare well last year, with investors

in Brazil, running to triple digits in the

By Brazilian standards, he noted, inflation is low. Even if some analysts Portfolio


43

REUTERS

Brazil’s growing middle class has created an upsurge in car imports.

February 2012


REUTERS

Investing

44

In Brazil the demand for consumer goods is outstripping supply. Analysts estimate between 25 to 40 million people have entered the middle class.

think it is above the 6.5 per cent target

emerging market research at Hansberger

said, had learned hard lessons from the

rate, the central bank cut interest rates

Global Investors, said countries like

crises of the 1990s that drove down the

at the end of November for the third

Brazil and Mexico had reduced their

value of their currencies and pushed up

time in 2011, a sign it is not concerned

debt-to-GDP ratios significantly in the

the cost of borrowing.

about inflation.

last decade, to levels better than in the

Francisco Alzuru, managing director of

developed world. And both countries, he

“This time, they have growth from the benefit of sound macroeconomic policy,” he said. “I don’t want to imply that Latin America is risk-free and we can invest with our eyes closed. But from a macroeconomic perspective, the boom and bust should be better managed.” JAMIE KRAMER, head of the thematic advisory practice at J.P. Morgan Private Bank, tells her clients interested in investing in Latin America to look for the “emerging markets of the future with their emerging middle class.” This is not as easy as it sounds. She noted that exchangetraded funds on the Brazilian index are often heavily weighted with energy and financial services companies, a different

Sergio Cabral, the governor of Rio de Janeiro, is focusing on diversifying his state's economy to become less dependent on the cyclical energy sector.

bet entirely. Zamorano said he had focused on Portfolio


investing in wireless telecommunications

needed most – housing and all the related

and consumer product companies. He

industries from mortgages to construction.

noted that when a consumer was going

“In the U.S, we have a saturated market,”

from $500 in annual income to $800,

he said. “In Mexico, the need for houses,

“you’re still subsistence.” But, he said,

the accumulated deficit is in the millions

“Once you’re getting to $5,000, $10,000

of units. You have 10 years of pending

you’re seeing car consumption, broadband,

demand for homes.”

consumer products going up. That’s a phase we’re seeing.” Alzuru said there were opportunities to invest in what the middle class in Mexico

“We need more hotels. We have a suite problem – we have demand but we need more supply.”

BEYOND INFLATION, investors should be wary of any economy significantly dependent on exports.

The State Department said 80 per cent of Mexico’s exports went to the United States in 2010, for instance, and the sluggishness of the US economy had slowed Mexico’s growth. The same fate is feared for Brazil and China. Chile is a big exporter of wine, flour, lithium and copper, while Peru exports various minerals, like copper, silver and gold. Such dependence on exports wreaked havoc in the 1990s. THERE IS also political risk. Venezuela, is economically worse off than it was 10 years ago, despite immense oil wealth. And Argentina is enduring high inflation – 9.8 per cent as of October 2011. But Zamorano said relatively high

REUTERS

interest rates meant the governments had One problem is that Brazil’s infrastructure is not keeping pace with the current rate of development. More roads, airports and harbours are needed.

the ability to cut rates to stimulate growth if needed – something developed countries like the United States or Japan can no longer do. Cabral said he was most worried about the slow development of roads, ports and airports in his state and Brazil in general. “In Brazil, for more money to be invested, you have to open more services, concessions, airports,” he said. “I’m concerned Brazil has to speed up the infrastructure to attract more investment.” His goal is to wean his state from its dependence on energy, which he recognises as volatile, and focus more on technology and education.

REUTERS

Back when I was there, Latin America’s economies were hard to tell apart. But More disposable income means that consumers can spend more. But one major problem in Latin America is to keep inflation in check. February 2012

now, they present as many opportunities and pitfalls as any other investment. n

Investing

45


Education

46

AFRICA’S RESEARCH BOOM

Computer science and computer engineering are gaining traction in Africa, and with it comes research focused on uniquely local problems, reports Pascal Zachary.

H

E MIGHT HAVE BEEN

Uganda’s capital, Kampala. At the top

content simply to teach

of a hill near the university’s entrance,

thousands of university

overlooking the derelict law school to

students in Uganda how to use computers,

one side and a school mosque to the

assemble them into networks, manage

other, two gleaming glass buildings went

them and write basic software programs.

up seemingly without a hitch. So many

In a poor African country with one of the

undergraduates swarmed them that

world’s fastest-growing populations and

the faculty held classes at midnight to

rising internet use, that alone would have

accommodate them.

been an enormous achievement. But Venansius Baryamureeba had

a vocational school; he also created a

bigger ideas. In 2005, when he returned

graduate programme he hoped would

home with a doctorate from the University

someday turn out dozens of Ph.D.

of Bergen in Norway, he was just one

scientists who would themselves become

and lecturer, said there are still serious

of a handful of computer scientists in

college professors and help push the

obstacles to pursuing such research in

Uganda. And his timing was right. The

boundaries of global research.

Uganda, including unreliable internet

largely agricultural economy had been

© 2011 NEW YORK TIMES NEWS SERVICE

Baryamureeba wanted more than

Research is surging in Africa. The Kiira EV car was made by Makerere University students and did its first test drive in Uganda’s capital Kampala in November 2011. The two-seater car is the first electric vehicle to be made in the country.

Improbably, his vision is gaining

Ernest Mwebaze, a doctoral student

service and power failures. But he also said the potential upside is huge.

growing by about seven per cent annually,

traction at Makerere. Young homegrown

propelling an enormous expansion of

scientists there are now nearing

the upper middle class and the urban

completion of their Ph.D.s. And faculty

challenges and problems whose solutions

elite’s aspirations for advanced training in

members are carrying out cutting-

can actually have a greater marginal

science and engineering.

edge experiments. They are seeking to

benefit than, say, solutions to problems in

endow cellphones with the ‘intelligence,’

Europe,” he said.

Emboldened by Uganda’s relative peace

“Uganda offers several unique research

Each Monday, in a laboratory of

and prosperity, Baryamureeba founded

embedded in tiny software programs

a new college that includes departments

animated by mathematical algorithms, to

thrumming computers, Mwebaze teaches

of computer science and computer

identify diseases in crops or malaria in a

a small class on artificial intelligence to

engineering at Makerere University, in

person’s bloodstream.

10 graduate students, highlighting this Portfolio


REUTERS

47

esoteric field, the subject of his doctorate

possibilities in computing science and

smashers are needed, as in physics; no

research. And the potential for Africans

engineering, beyond the traditional

giant telescopes, as in astronomy.

trained in Africa to conduct science

disciplines of medicine, law and finance or

attuned to the realities of Africa is not

the more typical scientific callings of crop

is still held back by the perception that it

limited to computing. “There’s a growing

and soil science.

is preferable to study and work in Europe

interest in research, and science generally,

“Computer science appeals to a

Computer science in Africa, to be sure,

or the United States, even if that means

in the region,” said Calestous Juma, a

generation of urban students raised on

leaving Africa permanently. This must

Harvard professor who specialises in the

a diet of digital devices,” said Chanda

change for computer science to flourish

study of technology and development.

Chisala of Zambia Online, a software

in the region. Georgia Tech researchers

development company and internet

recommended in a study that African

THE RAPID spread of cellphones has

provider in the Zambian capital, Lusaka.

educators reinforce efforts to mould

fuelled an appreciation among Africans

The field also may appeal to chronically

computer science curriculum to meet

for the practical uses of science and

underfinanced African universities

“local needs.”

technology. And the children of the

because the study of computer science

African elite are also seeing career

is relatively inexpensive. No big atom

February 2012

A shortage of skilled teachers also remains a problem. The continent’s


Education

48

Ernest Mwebaze, a doctoral student and lecturer at Makerere University, conducts a graduate class lecture on artificial intelligence.

leading computer science departments –

enthusiastically received.

based on research publications – are all in

But when he provided a

South Africa. Yet even there, the number

Nigerian computer centre

of university-level teachers is limited. “Our

with data compiled by

CS departments are much smaller than

Maryland, the centre started

counterparts in the US,” said Bill Tucker,

selling it. Subramanian, who

an American who is a senior lecturer at the

thought the data should have

University of Western Cape.

been openly available for

And differing ethical practices in African and American academic institutions complicate matters. When

scholars, found the experience “very troubling.”

A student project at the new computer science college at Makerere University.

Baryamureeba’s commitment has

V.S. Subrahmanian, a computer scientist

helped Makerere overcome such obstacles.

Partnerships with universities in Norway

at the University of Maryland, decided

He now leads the entire university,

and the Netherlands have also proved

to forge a research partnership in

ensuring that computer science and

crucial. Graduate students from Uganda

2010 with Nigerian professors, he was

engineering have high-level support.

have been able to study both at home and abroad. And the European

“Uganda offers several unique research challenges and problems whose solutions can actually have a greater marginal benefit than, say, solutions to problems in Europe.”

universities promise not to poach them, requiring that the students return to Uganda to get their doctorates. THERE’S ALSO a palpable sense among young scholars that Africa is cool – and Portfolio


microscopes and pattern-recognition devices could help people in the developed world lower costs of instant diagnosis of minor medical problems. So far, Quinn’s reputation has only been enhanced by his work in Uganda, and he’s earning decent pay. Postdoctoral salaries for European computer scientists are not that much different from the roughly $3,000 a month Quinn earns at Makerere. That has him thinking he will stay awhile in Kampala. He’d initially planned to stick it out for two years, but he’s now already four years into his African university tenure and sees a lot of running room in computer science – for himself, and for Africa. n Makerere University was dilapidated a few years ago. But increased funding, a new focus and more international cooperation has seen it reinvent itself.

that universities are improving just

Google. One project involves designing

enough to advance the scientific ambitions

code that turns a cellphone into a

of Western scientists.

sophisticated microscope. He presented

Consider John Quinn, a Scot. He

his research on diagnosing malaria over

attended Cambridge and received a

the phone at an international conference

doctorate in computer science from the

in San Francisco last August.

University of Edinburgh. Searching for an

“There’s a growing awareness of the

unconventional research experience, he

need to focus, to specialise and to become

contacted Makerere just as Baryamureeba

internationally competitive,” Quinn said of

was casting about for international talent

himself and his colleagues.

to bolster his faculty. Quinn accepted,

One potentially practical and profitable

and has never looked back. An artificial

benefit partly explains the interest

intelligence research group he formed has

of computer companies in Quinn’s

received financing from Microsoft and

research: Turning cellphones into cheap

One focus of African research is to make the testing for common diseases, such as malaria, cheaper and quicker.

Computer science and computer engineering faculties are popular at African universities as research is relatively inexpensive. February 2012

Education

49


Finance

50

REUTERS

A policeman stands in front of the headquarters of Equitalia, an Italian state agency that collects overdue taxes and fines.

ITALY’S TAXING PROBLEM It is estimated that Italy loses $150 billion annually in undeclared revenues. That money is badly needed to reduce the country’s $2.5 trillion public debt, report Rachel Donadio and Elisabetta Povoledo.

O

to pay up. Such efforts, along with a new

Maurizio Compagnoni, an

blitz of public service announcements

Mario Monti’s new $40 billion austerity

employee of Italy’s internal

trying to raise the social stigma on tax

package, which received final approval

revenue service, stood before a classroom

evasion, have become crucial as Italy

in late December in the Senate, includes

of middle school students in a leafy

struggles to reduce its $2.5 trillion public

tougher measures that will allow tax

neighbourhood in Rome, preaching the

debt and fend off speculative attacks.

officials to peer into Italians’ bank

virtues of paying taxes. “You may think,

© 2012 NEW YORK TIMES NEWS SERVICE

To tackle the issue, Prime Minister

N A RECENT MORNING,

The tax authorities say Italy loses

accounts to check declared income against

‘I’m 13, why should I care about taxes?’”

an estimated $150 billion a year

bank deposits – not to mention yacht, car

he said with earnest enthusiasm as the

in undeclared revenues, while the

and home ownership – under a new cross-

students looked on, slightly bored. “But

national statistics authority places the

referencing initiative.

you can take a step in the right direction.

underground economy at about 17.5 per

You can change the behaviour of the people

cent of gross domestic product – the

transactions above $1,300 – common in

around you, your parents and friends.”

third highest in Western Europe after

Italy, where low credit-card use keeps

Malta and Greece but before Spain. Other

private debt low but evasion high –

experts place the percentage much higher.

and lower the threshold for which tax

Compagnoni is one soldier in a battle – often uphill – to persuade Italy’s citizens

The measures also prohibit cash

Portfolio


evasion becomes a criminal offense. The

This heritage lingers. Many Italians

government has also set an additional 1.5

approach tax evasion with true delight,

per cent tax on assets repatriated under

taking pride in outsmarting the system,

an earlier tax amnesty, raising the levy for

aided by books sold online and by Italy’s

those requesting anonymity.

113,000 tax accountants.

ITALY IS filled with colourful anomalies.

question of survival. “When I first opened

According to tax officials, nearly half

my restaurant, my accountant sat me

of boats larger than 10.7 metres are

down and told me that if I wanted to

registered to people who declare income

pay all my taxes, I might as well close

of less than $26,000 a year, and 604

up shop immediately,” said Giuseppe, a

airplane owners declared annual income

restaurant owner in Rome who said he

between $26,000 and $65,000.

was a basically honest person who had

Many Italians say rule-breaking is a

Radio 24 recently reported that there

been “forced to evade taxes” because of

are about 2.5 million luxury cars in

Italy’s costly fiscal system. Like many

Italy, yet tax officials say that in 2009,

Italian restaurateurs, Giuseppe does not

less than two per cent of Italy’s 41 million

always present diners with a cash-register

taxpayers declared annual income of more

receipt at the end of the meal, so the sale

Finance

51

“Radio 24 recently reported that there are about 2.5 million luxury cars in Italy, yet tax officials say that in 2009, less than two per cent of Italy’s 41 million taxpayers declared annual income of more than $260,000 – indicating that many declare far less income than their lifestyles would suggest.”

than $260,000 – indicating that many declare far less income than their lifestyles would suggest. To rein this in, Italy is introducing the cross-referencing initiative, dubbed the ‘income-o-meter,’ to be put in place in the coming months. “If you declare $26,000 a year, you can’t buy a piece of real estate valued at $1.3 million,” said Attilio Befera, the director of the Agenzia delle Entrate, Italy’s internal revenue service. Discrepancies like that will now prompt an audit, Befera said. It is a cultural battle as much as a logistical one. Noting that it is a Roman Catholic country, Befera said: “We have the concept of pardon, of penitence. From a fiscal point of view this is the sanction that I will pay when they find me.” (The previous government introduced various tax amnesties, which critics said condoned evasion.) “In the United States, the first forms of taxation were in the far West for the defence of the community, for a kind of sheriff, and anyone who didn’t pay was expelled from the community,” Befera said. “Here, the first forms of taxation REUTERS

were imposed by princes, usually foreign, to pay for their own battles. So our citizens did everything not to pay because they saw nothing in return.” February 2012

Italian Prime Minister Mario Monti’s $40 billion austerity package includes tougher measures against tax evasion.


REUTERS

Finance

52

According to Italian officials, nearly half of boats larger than 10.7 metres are owned by people who declare income of less than $26,000 a year.

is not legally registered and, therefore,

considerably higher for what you eat.” For

under the table for overtime, evading

not taxed.

Giuseppe, running a business involves

payroll taxes, which are above 40 per cent.

“If I didn’t do it, I just wouldn’t

keeping complex records. Provisions he

“I can’t afford to pay overtime and they

survive,” he said. “If we respected all

buys without receipts have to disappear

can’t afford to live on their base salaries,”

the rules from A to Z, prices would be

without being tallied; he pays waiters

he said. “This way, we both benefit.” Business associations have urged the government to reduce the tax burden for companies and workers and raise it on assets. In December, the governor of the Bank of Italy, Ignazio Visco, said that Italy’s tax burden had risen to 45 per cent overall and called for urgent reforms to help lower it. “TAX EVASION has a significant impact on growth,” said Alberto Bisin, an economist at New York University. He said it kept companies from expanding by keeping productivity low – and less traceable. “I’m not saying that we should let people evade,” but that reform is difficult as long as taxes are so high, he said. A country where some bear a heavy tax burden and others do not

Tomaso Savorani (R) and his classmates watch a video about tax evasion at their school. Such initiatives are part of a broad attempt to get tax evaders to pay up.

pay anything creates a “skewed system, distorting and horrible,” he added. Portfolio


REUTERS

Finance

53

Members of the Northern League Party hold placards in parliament to protest against Italian Prime Minister Mario Monti’s austerity package and new tax laws.

additional income off the books. Massimiliano D’Angeli, a criminal defence lawyer, says he believed that if more services like those provided by lawyers, plumbers and electricians were tax deductible rather than subject to the nation’s 23 per cent value-added tax, REUTERS

people would have an incentive to ask for receipts. Instead, many workers and Italy is home to 2.5 million luxury cars, but less than two per cent of Iocal tax payers declared an income of more than $260,000. That indicates many tax payers are declaring less income than their lifestyles suggest.

professionals offer a “VAT discount” for payment under the table. In spite of Monti’s approval ratings, there is widespread scepticism that the

ADDING TO the challenges, five million

is available, just under 50 per cent of

anti-evasion measures will work. Asked

Italians are self-employed, including many

Italian workers, or 20 million people,

why Italy had had so much trouble

doctors, contractors and small-business

declared annual income of $20,000 or

cracking down on evasion, Bruno Tinti,

people, compared with 2.7 million in

less a year, according to tax agency data.

a former prosecutor turned journalist

France and 3.9 million in Germany.

Many are salaried workers whose taxes

specialising in the black economy, had a

Evasion among them is rampant.

are automatically deducted, but others

simple answer: “Tax evaders vote, that’s

are self-employed or most likely have

the problem.” n

In 2009, the last year for which data February 2012


54

China is leading the world in introducing Internet Protocol version 6. This version has many more IP addresses, something China badly needs.

China Scrambles for High-tech Dominance The future of the internet is already in China and most of the world’s consumer electronics are manufactured there. The next step could be technological breakthroughs, report David Barboza and John Markoff.

Portfolio


I

N AN OTHERWISE

well be. Because of the ready availability of

nondescript conference room in

low-cost labour, China has already become

Beijing, Wu Jianping stands before

the world’s dominant maker of computers

a giant wall of frosted glass. He toggles a

and consumer electronics products. Now,

switch and the glass becomes transparent,

these experts say, its booming economy

looking down on an imposing network

and growing technological infrastructure

operations centre full of large computer

may thrust it to the forefront of the next

displays. They show maps of China and the

generation of computing.

world, pinpointing China’s IPv6 links, the next generation of the internet. China already has almost twice the

computing centres is not simply a matter of national pride. It is an attempt to lay

number of internet users as in the United

the groundwork for innovative Chinese

States, and Wu, a computer scientist and

companies and to reshape the technological

director of the Chinese Educational and

landscape by doing something more than

Research Network, points out that his

assembling the world’s desktop PCs.

nation is moving more quickly than

Never mind that there may be no

any other in the world to deploy the

Chinese Steve Jobs, said Clyde Prestowitz

new protocol.

Jr., president of the Economic Strategy

IPv6 – Internet Protocol version 6

Institute. “There are different kinds of

– offers advanced security and privacy

innovation,” he said. “We tend to equate

options, but more important, many more

innovation with companies that start from

IP addresses, whose supply on the present

garages based on brainstorms. There is

internet (IPv4) is almost exhausted. “China

another kind of innovation that results in

must move to IPv6,” Wu said. “In the US,

constant improvement that we are not good

some people don’t believe it’s urgent, but we

at – and they are.”

believe it’s urgent.”

The view is not universal. Still, other

If the future of the internet is already

experts say it would be a mistake to

in China, is the future of computing there

underestimate China’s capacity for

as well?

rapid progress.

Many experts in the US say it could very

“When I went to China for the first time

REUTERS

© 2011 NEW YORK TIMES NEWS SERVICE

For China, the quest to develop advanced

Innovators such as Steve Jobs are revered in China, although the country has as yet to produce one. But some analysts point out that China is good at a different kind of innovation, namely constant improvement. February 2012

Innovation

55


Innovation

56

“Now innovation is accelerating, and in the future, patents on smartphones and tablets will be originated by the Chinese people.” in 1978, I saw workers stringing together computer memories with sewing needles,” said Patrick McGovern, the founder of the International Data Group, an early investor in Tencent Holdings, one of the most successful Chinese internet companies. “Now innovation is accelerating, and in the future, patents on smartphones and tablets will be originated by the Chinese people.” GOING BACK six decades – to ENIAC, considered to be the first electronic computer – the US has set both the pace and the path of modern computing and communication. From mainframes to iPhones, from the ARPANET to WiFi, innovation has been as American as

REUTERS

Norman Rockwell. And for more than a China has almost double the internet users as in the US. This number is growing rapidly and China will soon be the world's largest online retail market.

generation, the hub of innovation has been Silicon Valley, a multicultural melting pot that has supported the singular amalgam of computer-hacker ethos and entrepreneurial aggressiveness that made it the envy of the world. Probably the most serious challenge to the Valley’s dominance came in the late 1980s from Japan, which seemed on the brink of taking command of the semiconductor and computer industries until its economy foundered. Today, China poses a very different kind of challenge. While Japan’s economy has long been driven by exports, China will soon have the world’s largest domestic market for both internet commerce and computing. The world took notice of Chinese technological prowess in late

REUTERS

2010, when a Chinese supercomputer, China has fallen short on a decade long commitment to build the world's leading semiconductor industry. Most processors are still imported from the US or Taiwan.

the Tianhe-1A, briefly became the world’s fastest. Though it was made from US processors and was soon surpassed by a Portfolio


Innovation

57

Japanese machine, it was still indisputable evidence that the Chinese had achieved world-class computing designs. In 2010, in an interview that would have been seen as extraordinary if the remarks had been made by a US president, Premier Wen Jiabao committed China to creating an “Internet of things.” Connecting homes and smart power grids has been a driving principle behind the next-generation internet in the US. And it goes hand in hand with “ubiquitous computing,” the idea that computing smartphones and digital music players. But China’s efforts at dominance are hardly without obstacles. The country has fallen

REUTERS

power transforms everyday devices like In some industries, such as the making of solar panels, China has become the undisputed world leader.

far short on a decade-long commitment to

in game theory and computer security.

build the world’s leading semiconductor

“Overnight there is lots of activity coming

industry, and it still imports a vast majority

from Beijing,” said Christos Papadimitriou,

of microchips for the products it assembles.

a computer scientist at Berkeley.

Its best chip factories are two to three

And there is little question that the

Not every China specialist buys such comparisons. “When we look at China through the lens of American decline, we see the Chinese ascendancy, we see the modern skylines

generations behind world leaders like Intel,

structure of Chinese industry is becoming

and the fastest computers and the new

in the US, and TSMC, in Taiwan.

more innovation-oriented. Last summer

airports, and we see an invincible force

Dieter Ernst, senior fellow at the East-West

building,” said Orville Schell, director of

to be too much government control.

Centre, testified before a US congressional

the Center on US-China Relations at the

Chinese innovation may also be limited

commission that the Chinese had

Asia Society. “Through Chinese eyes it looks

by the relative lack of intellectual property

overtaken South Korea and Europe in

tremendously uncertain and provisional.

protection, discouraging entrepreneurs

total patents and were catching up with

They are not filled with self-confidence.”

from breaking new ground.

the US and Japan.

China’s great weakness may prove

At the same time, there is a consensus

But McGovern, the investor and venture capitalist, thinks that may be an advantage.

WHAT SCARES competitors is that

that China’s entrepreneurs have a

In the United States, he says, he is often

China has begun producing waves of

workaholic culture that is unmatched

approached by overconfident entrepreneurs

amazing hardware engineers and software

anywhere in the world.

who walk off in a huff when he is less than

programmers, winning international

“What I found in doing five startups in

impressed by their ideas. The Chinese

competitions and beginning to dominate

China is the culture makes Silicon Valley

the best engineering programmes in the

look laid-back and slow,” said Tom Melcher,

US. Much has been made of computer

an entrepreneur who left California a

their language-translation software that

science ‘returnees,’ most notably Andrew

decade ago to move to Beijing. “In Beijing,

will convert Mandarin to English and

Chi-Chih Yao, who left Princeton to create

if you want to find a chief executive at 7:30

back again,” he said. “Then I will tell

an institute at Tsingtao University in Beijing

pm on a Friday, it’s guaranteed you will find

them that I don’t think there is a market

that has already made breakthroughs

him at the office.”

because it is too difficult to protect the

“When we look at China through the lens of American decline, we see the Chinese ascendancy, we see the modern skylines and the fastest computers and the new airports, and we see an invincible force building.”

entrepreneurs he deals with are different. “They will come to me and show me

intellectual property.” Rather than send them away, however, he might ask them if they would be interested in working on a different idea that his firm has been considering. “They will respond, ‘Can I get rich?’ When I tell them that I think that there is a good chance, they say, ‘OK, I’ll do it!’” n

February 2012


59

Essentials

THE BEST OF LEISURE AND LIFESTYLE

SICILY ON A HARLEY

With a Harley-Davidson you experience freedom in a different way. You see and smell the countryside, feel the warm embrace of the wind and the camaraderie of the open road. Tarak Parekh explored Sicily’s stunning coastline while enjoying Harley-Davidson’s world of custom legends.

View of Taormina from Madonna della Rocca February 2012


Essentials

60

Travel

GETTY IMAGES

The Teatro Greco, in Taormina, is Sicily’s most famous ruin and a major tourist attraction.

Although it is still often overshadowed by

countryside that had been fertilised by

town that looks like it might

Harley’s traditional offerings, the high-

Mount Etna through the centuries.

tumble down the cliffs

tech V-Rod line-up is still selling well

AORMINA IS A LITTLE

under the sheer weight of visitors. But this

after a decade, especially the Night Rod

Linguaglossa for a coffee break. Vineyards,

enduring popularity testifies to its unique

Special that has been a hit with the under-

giant pine trees and snow-capped

location, rich history and stunning beauty.

35 customers.

mountain surround the town, which is a

The Hotel Grand Timeo distils all these

The Night Rod Special is easy to ride so

popular winter ski destination. Our Italian

attributes as it is set high in the rocky hills

I had plenty of time to enjoy Taormina’s

photographer, Stefano Gadda, introduced

of Sicily’s east coast with mind-blowing

medieval beauty of cobbled streets and

us to the legendary Sicilian almond

cliff top views of the Mediterranean,

postcard scenery. We rumbled through

biscuits. According to him the supple

Taormina and its unique neighbour: the

Messina Gate past souvenir shops and

texture eludes even the most skilled of

historic amphitheatre of Teatro Greco. If

restaurants towards Linguaglossa, our

Italian bakers. I’m not sure if he was telling

location is everything, then Taormina and

first stop. This town was founded in 1586

a tall tale, but they were delicious.

Grand Timeo have it all.

on a lava stream, which is reflected in its

After a lavish Sicilian breakfast I headed down to the parking lot where 12

Sicilian name that means ‘tongue’. The day couldn’t have been better

Besides its winter fame, Linguaglossa is also central to excursions up Mount Etna that can reach 3,000 metres altitude. Our

new Harleys, two days of adventure and

with an azure sea and the clear blue sky

ride was fascinating as we wound through

around 300 kilometres of country roads

dominated by Mount Etna – one of the

a panorama of Sicilian life along the

waited. After a briefing from Gaetano

world’s most active volcanoes. It has six

narrow, curving road. Climbing for a good

di Piazza, regional manager of Harley-

distinct craters but also erupts along its

half hour it was hard to maintain focus

Davidson South-east Europe, we set off on

flanks. This millennium there has already

as competing views of the Mediterranean

the ride of a lifetime.

been four flank eruptions between 2001

to one side and Mount Etna on the other

and 2009. Summit eruptions occurred

threatened to divert my attention for a

Davidson Night Rod Special with a black-

in 2006, 2007–2008 and as recent as

split second too long. Europe’s highest

orange colour scheme, lightweight wheels

January 2012. That knowledge honed my

active volcano was gurgling and smoking

and an inverted front. In 2002 the V-Rod

riding skill as we cruised along the fun

as we rode up to the observation point

introduced the revolutionary V-Twin,

but demanding road with a fair mix of

and I wondered if we were literally

Harley’s first liquid-cooled engine.

hairpin corners, long straights and green

playing with fire.

My first bike was the 2012 HarleyPHOTOS: TARAK PAREKH

After two hours of cruising we arrived at

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61

The paradox of Mount Etna is that although its angry eruptions decimate the landscape, the resulting volcanic soil is extremely fertile. The volcano covers an area of 1,190 km2 and supports citrus groves, vineyards and orchards across its lower flanks and the broad Plain of Catania to the south. After posing for some photos against the black lava landscape, it was time to experience a more traditional Harley. So I switched to the Dyna Wide Glide as we set-off to Randazzo for lunch. The Wide a chopped rear fender, black rims, an oldschool flame paint scheme tank console, ‘Tommy Gun’ exhaust, raked-out forks and

GETTY IMAGES

Glide suited the Mount Etna scenery with

Mount Etna is Europe’s highest active volcano at 3,329 metres. The last eruption added 20 metres to the summit.

a swept back sissy bar. Lunch was at Parco Statella Restaurant, an authentic baronial villa surrounded by vineyards, horse stables and a magical 150-year-old garden. The food was something that has to be experienced. First up were antipasti, which included different type of salami, local cheese, olives, peperonata (marinated sweet and sour peppers with pine nuts and raisins) and garlicky eggplant slices. Up next was

“The chef told us that pistachios, also known as the ‘green gold of Etna’, are highly prized in Sicily. The majority of the nuts come from Bronte, an area situated on the base of Mount Etna.”

Sicilian almond biscuits are famous for their unique texture and taste. February 2012

Coffee break in Linguaglossa. The town was founded in 1586 on a lava stream.


Essentials

Travel

The former fishing port of Giardini Naxos is now popular with summer visitors who flock to its many beaches.

GETTY IMAGES

62

Porcini del Etna mushroom soup with

life, unlike the comparatively crowded

THE NEXT morning started with the

cream and basil, followed by Pistachio

Randazzo. En route we stopped at the

news of bad weather along our planned

de Bronte Farfalle. The chef told us that

Alcantara Gorges, a massive rocky chasm

route, which meant shortening our trip.

pistachios, also known as the ‘green gold

created by Mount Etna’s eruptions that

Still, it wasn’t all bad news as I started my

of Etna’, are highly prized in Sicily. The

have literally split mountains in two.

day with the Fat Boy Lo, which belongs to

majority of the nuts come from Bronte, an

The gorges are surrounded by lush

the softail family and was immortalised by

area situated on the base of Mount Etna.

woods fed by waters running off the

Arnold Schwarzenegger in Terminator 2:

Next on our plate was hand cut Salsiccia.

volcano’s slopes and the southern regions

Judgement Day. The Fat Boy epitomises

As if this wasn’t enough the chef brought

of the Nebrodi Mountains. Thanks to

the slammed boulevard cruiser look, but

Polpette, meat sandwiched between two

our heavy Sicilian lunch we were in no

Harley-Davidson takes it one step further

glossy lemon leaves that infuse it with a

mood to clamber the 50 metres down

with the Fat Boy Lo, which has an even

delicate citrus taste. The coup de grâce

to the river, attractive as it looked, so we

lower, darker appearance.

came in the form of Sicilian Pistachio cake

headed back to the hotel for a rendezvous

and Fichi D’India (Prickly Pear cactus

with a massive Sicilian dinner.

We threaded our way through a vibrant throng of people towards the interior of

fruit) accompanied by a shot of espresso! After this heavy Sicilian lunch we swapped motorcycles again, and this time I was on my favourite: the Roadking Classic. This touring bike takes the

Sicilian roads are a biker’s dream with small roads and tight curves winding through stunning countryside.

nostalgic look and feel of the Road King a little further with extra details such as leather-wrapped saddlebags, which easily accommodate a pair of shoes, a change of clothes and a few bottles of water. Then there’s the nostalgic chrome fuel tank, tooled metal detailing on the fender, tank, seat and bags, and chrome-laced wheels with wide whitewall tires. It also comes standard with its biggest engine yet: the Twin Cam 103 V-Twin. After Rendozza we passed Castiglione di Sicilia, a small town with few signs of Portfolio


Essentials Travel

The medieval main street of Taormina is filled with high-end fashion shops and upmarket restaurants.

can be removed in under a minute without

the small medieval town on foot. The

tools. I enjoyed the ride, minus windshield,

Greek amphitheatre is Taormina’s tourist

to the summer resort of Zafferana Etnea.

highlight and also the most celebrated

This town developed around the Priory

ruin in Sicily. The theatre, on an elevation

of San Giacomo in the upper part of the

east of the city, is the largest remain of

A pistachio cake. Pistachios are known as the ‘green gold of Etna’ and feature heavily in Sicilian cuisine.

Valle del Bove. Unfortunately this is at the

ancient Taormina with a diameter of

confluence of lava streams from Mount

some 109 metres and an arena area of 35

Etna’s Eastern craters, which frequently

square metres. It might look familiar as

Sicily. Wasting no time, we settled into the

have destroyed Zafferana Etnea although

Woody Allen filmed Mighty Aphrodite

ride and enjoyed the still perfect weather.

it has always been rebuilt. In the 1992

here. Next on the list was Madonna della

A few photo opportunities later we were

eruption it came close to being wiped off

Rocca or Madonna of the Rock, which is

riding through Giardini Naxos, which was

the map again. Surroundings Zafferana

a charming chapel carved out of a natural

once a quiet village but is now famed for

Etnea are sites of both natural and

grotto, but to get there is a steep climb.

its beaches, panoramic view of the bay and

historical interest, such as the Bove Valley

By the time we reached the summit the

small fishing port. It attracts foreign visitors

with the old craters of Rocca degli Zappini

promised bad weather had arrived and it

and Italians alike, many of whom own

and Serra Giannicola Grande, and the

started pouring down.

summer residences here. In July and August

Sentiero Natura di Monte Zoccolaro – a

the beaches are apparently at bursting

century old chestnut forest.

point, especially around Ferragosto on 15

After a quick shot of espresso we headed

Initially we took shelter under a small souvenir shop but soon realised it wasn’t helping much. So we rushed towards

August when it is customary to camp on the

towards the Harley-Davidson Catania

the chapel, opened the doors and found

beach and go for a midnight swim.

dealership to return the bikes. Surprisingly,

ourselves smack in the middle of a 50th

the dealership had a large room filled with

wedding anniversary celebration. Despite

day was short and I wanted to ride as many

vintage models ranging from 1924 all the

looking like drowned rats, the Sicilian

Harleys as possible. This time it was the

way to the present. It was a fitting end to

family welcomed us and soon we were

Dyna Switchback, which is like two bikes

two days of cruising around some of Sicily’s

talking in animated sign language while

in one with detachable hard saddlebags

finest roads on our trusty steeds.

sharing hot espresso. Somehow, this warm

It was time for another change as the

act of local kindness perfectly summed up

and windshield. This ‘switchback’ happens quickly as the windshield and saddlebags February 2012

BACK AT Taormina it was time to explore

my Sicily experience. n

63


64

PERMAFROST THAW COULD COMPOUND WARMING Scientists have long known that permafrost in the northern hemisphere is preventing a huge amount of greenhouse gases from entering the atmosphere. But as the permafrost warms, scientists fear the release of carbon dioxide and methane could rapidly intensify global warming, reports Justin Gillis. Portfolio


Essentials Environment biggest looming mysteries about the

so, and NASA is considering a similar

future of the earth.

plan. But researchers say the money

Experts have long known that northern lands were a storehouse of frozen carbon, locked up in the form of leaves, roots and

and people devoted to the issue are still minimal compared with the risk. For now, scientists have many more

other organic matter trapped in icy soil

questions than answers. Preliminary

– a mix that, when thawed, can produce

computer analyses, made only recently,

methane and carbon dioxide, gases that

suggest that the Arctic and sub-Arctic

trap heat and warm the planet. But they

regions could eventually become an

have been stunned in recent years to

annual source of carbon equal to 15 per

realise just how much organic debris

cent or so of today’s yearly emissions from

there is. A recent estimate suggests that

human activities. But those calculations

the perennially frozen ground known

were deliberately cautious. A recent survey

as permafrost, which underlies nearly

drew on the expertise of 41 permafrost

a quarter of the Northern Hemisphere,

scientists to offer more informal

contains twice as much carbon as the

projections. They estimated that if human

entire atmosphere.

fossil-fuel burning remained high and the

Temperatures are warming across much

planet warmed sharply, the gases from

of that region, primarily, scientists believe,

permafrost could eventually equal 35 per

because of the rapid human release of

cent of today’s annual human emissions.

greenhouse gases. Permafrost is also

“Even if it’s five or 10 per cent of today’s

warming. Some has already thawed, and

emissions, it’s exceptionally worrying,

other signs are emerging that the frozen

and 30 per cent is humongous,” said

carbon may be becoming unstable.

Josep Canadell, a scientist in Australia

“It’s like broccoli in your freezer,” said

who runs a global programme to monitor

Kevin Schaefer, a scientist at the National

greenhouse gases. “It will be a chronic

Snow and Ice Data Centre in Boulder,

source of emissions that will last hundreds

Colorado. “As long as the broccoli stays in

of years.”

the freezer, it’s going to be OK. But once Methane, a particularly powerful greenhouse gas, collects under the ice near Fairbanks, Alaska.

A

KATEY WALTER Anthony had been

in the fridge, it will thaw out and

told to hunt for methane, and she could

eventually decay.”

not find it. As a young researcher at the

If a substantial amount of the carbon

University of Alaska, Fairbanks, she

BUBBLE ROSE THROUGH

should enter the atmosphere, it would

wanted to figure out how much of that

a hole in the surface of a frozen

intensify the planetary warming. An

gas was escaping from lakes in areas of

lake in Fairbanks, Alaska. It

especially worrisome possibility is that a

permafrost thaw. She was doing field work

popped, followed by another, and another,

significant proportion will emerge not as

in Siberia in 2000, scattering bubble traps

as if a pot were somehow boiling in the

carbon dioxide, the gas that usually forms

around various lakes in the summer, but

icy depths.

when organic material breaks down, but as

she got almost nothing.

Every bursting bubble sent up a puff

© 2011 NEW YORK TIMES NEWS SERVICE

you take it out of the freezer and put it

methane, produced when the breakdown

of methane, a powerful greenhouse gas

occurs in lakes or wetlands. Methane is

generated beneath the lake from the decay

especially potent at trapping the sun’s heat,

of plant debris. These plants last saw the

and the potential for large new methane

light of day 30,000 years ago and have

emissions in the Arctic is one of the

been locked in a deep freeze – until now.

biggest wild cards in climate science.

“That’s a hot spot,” declared Katey Walter

Scientists have declared that

Anthony, a leading scientist in studying

understanding the problem is a major

the escape of methane.

priority. The US Department of Energy

It was another small clue for scientists struggling to understand one of the February 2012

and the European Union recently committed to new projects aimed at doing

“As long as the broccoli stays in the freezer, it’s going to be OK. But once you take it out of the freezer and put it in the fridge, it will thaw out and eventually decay. ”

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66

Essentials

Environment

Then, that October, the lakes froze over.

the air as carbon dioxide, the primary

much heat as the carbon dioxide would. Walter Anthony’s seminal discovery

Plumes of methane that had been hard to

greenhouse gas. But in areas where

spot on a choppy lake surface in summer

oxygen is limited, like the bottom of a

was that methane rose from lake bottoms

suddenly became more visible.

lake or wetland, a group of bacteria

not as diffuse leaks, as many scientists

called methanogens will break down the

had long assumed, but in a handful of

it looked like the starry night sky,” Walter

organic material, and the carbon will

scattered, vigorous plumes, some of them

Anthony said. “You could see these bubble

emerge as methane.

capable of putting out many quarts of gas

“I went out on the ice, this black ice, and

clusters everywhere. I realised – ‘aha!’ –

Scientists are worried about both gases.

this is where all the methane is.”

per day. In certain lakes they accounted

They believe that most of the carbon will

for most of the emerging methane, but

emerge as carbon dioxide, with only a few

previous research had not taken them

deep freeze, it is consumed by bacteria.

per cent of it being converted to methane.

into consideration. That meant big

If the material is well-aerated, bacteria

But because methane is such a potent

upward revisions were probably needed in

that breathe oxygen will perform the

greenhouse gas, the 41 experts in the recent

estimates of the amount of methane lakes

breakdown, and the carbon will enter

survey predicted it would trap about as

might emit as permafrost thawed.

When organic material comes out of the

Most of the lakes Walter Anthony studies were formed by a peculiar

Frozen Carbon

EXTENT OF PERMAFROST

Perennially frozen ground, known as permafrost, underlies nearly a quarter of the Northern Hemisphere and stores a huge amount of carbon.

Continuous 90% 50% 10%

Bering Sea

None

ALASKA

Seattle

way a concrete pillar supports a building. But when thaw begins, the ground sometimes turns to mush and the entire area, known as a thermokarst. A lake or

Anaktuvuk River fire

wetland can form there, with the dark surface of the water capturing the sun’s

CANADA SIBERIA

heat and causing still more permafrost to thaw nearby.

Sea ice extent Sept. 2011

Near thermokarst locations, trees

North Pole

often lean crazily because their roots are disturbed by the rapid changes in the

Baffin Bay

underlying landscape, creating “drunken

GREENLAND

Quebec City

supports the ground surface, almost the

land surface collapses into a low-lying

CHINA

Fairbanks

mechanism. Permafrost that is frozen hard

forests.” And the thawing, as it feeds on

Barents Sea

itself, frees up more and more ancient plant debris.

RUSSIA ARCTI

C CIRCLE

ICELAND

ONE DAY in 2007, on the plain in

Moscow

Atlantic Ocean

northern Alaska, a lightning strike set

SWEDEN

the tundra on fire. Historically, tundra, a landscape of lichens, mosses and delicate plants, was too damp to burn. But the PERMAFROST FORMATION AND THAWING

climate in the area is warming and drying, Forest

“Drunken” forest

Methane

and fires in both the tundra and forest regions of Alaska are increasing.

Ancient grass and shrubs

Soil

Seasonally frozen soil, silt and debris Continuously frozen ground

Permafrost

ANCIENT PLANTS removed carbon from the atmosphere by absorbing carbon dioxide. When the plants died, much of their stored carbon was trapped and frozen in layers of soil and glacial silt.

OVER THOUSANDS OF YEARS the layers of soil and debris built up to form a deep layer of continuously frozen ground, called permafrost, which now contains twice as much carbon as the entire atmosphere.

Sources: National Snow and Ice Data Center; BioScience; National Research Council Canada; NASA

N.Y. Times News Service Date: 12/20/11

The Anaktuvuk River fire burned about

Lake

Permafrost

1,035 square kilometres of tundra, and Thaw

CARBON ESCAPES when organic material in permafrost thaws and decomposes. Carbon dioxide is released in aerated areas, but in lakes and wetlands carbon bubbles up as methane, an especially potent greenhouse gas. JONATHAN CORUM/THE NEW YORK TIMES

work on lake sediments showed that no fire of that scale had occurred in the region in at least 5,000 years. Scientists have calculated that the fire and its aftermath sent a huge pulse of Portfolio


67

Katey Walter Anthony is a leading scientist in studying the escape of methane. With temperatures warming across much of the Northern Hemisphere, permafrost is also warming and releasing more greenhouse gases.

carbon into the air – as much as would

do not yet understand could speed the

be emitted in two years by a city the size

release of carbon from permafrost – or,

of Miami. Scientists say the fire thawed

possibly, slow it more than they expect.

the upper layer of permafrost and set off

thawing permafrost could spur denser plant

the landscape.

growth in the Arctic, and the plants would

Up to now, the Arctic has been

should fires like the one at Anaktuvuk River

once expected to keep doing so throughout

race across warming northern landscapes,

this century. But recent analyses suggest

immense amounts of organic material in

that the permafrost thaw could turn the

vegetation, soils, peat deposits and thawed

Arctic into a net source of carbon, possibly

permafrost could burn.

did not account for fire. “I maintain that the fastest way you’re

February 2012

take up some carbon dioxide. Conversely,

absorbing carbon, on balance, and was

within a decade or two, and those studies

As the permafrost warms, trees become destabilised and start leaning at acute angles.

For instance, nutrients released from

what they fear will be permanent shifts in

Edward Schuur, a University of Florida researcher who has done extensive field work in Alaska, is worried by the changes

going to lose permafrost and release

he already sees, including the discovery

permafrost carbon to the atmosphere is

that carbon buried since before the dawn

increasing fire frequency,” said Michelle

of civilisation is now escaping.

Mack, a University of Florida scientist who

“To me, it’s a spine-tingling feeling, if it’s

is studying the Anaktuvuk fire. “It’s a rapid

really old carbon that hasn’t been in the air

and catastrophic way you could completely

for a long time, and now it’s entering the

change everything.”

air,” Schuur said. “That’s the fingerprint of

The essential question scientists need to answer is whether the many factors they

a major disruption, and we aren’t going to be able to turn it off someday.” n


68

MEN, ONCE AGAIN, INVEST IN SKIN CARE

In the middle of the ‘90s there was a boom in male cosmetics but it quickly died down. Now there’s a resurgence, and it might be due to the tight employment market, reports Douglas Quenqa. Thomas Sullivan, who uses some pricey skin-care products, in New York

N

OT LONG AGO, THOMAS Sullivan’s beauty routine began and ended with Irish Spring.

But as Sullivan, an entrepreneur, actor, film producer and restaurant owner, approached 40, he realised his livelihood might benefit from a bit more personal maintenance. “I have to take advantage of any way I can to look, if not younger, healthy,” said Sullivan, who is 43. “Working in the restaurant and film industry leaves little time for sleep or working out with any regularity.” So, he started investing in some pricey skin-care products. Today, Sullivan can rattle off a half-dozen creams that make up his daily routine. All in all, he estimates that he spends about $600 a year on such products. Graduating from bar soap to, say, organic face wash is a transition many men will never make, let alone adding concealers, herbal moisturisers or age-defying sunscreens to their daily routines. Some men tried in the middle of the previous decade – we called them metrosexuals – but the fad quickly died out, dragging sales of just-for-men beauty products down with it. © 2012 NEW YORK TIMES NEWS SERVICE

But there is once again a demand among men for high-end skin-care products, in spite of moribund economies. Or maybe because of it. The reason, beauty analysts say, is a changing attitude among men, who now associate healthy-looking skin less with vanity than with professionalism. Portfolio


Essentials Fashion “The biggest thing in my view is guys

men have periodically shown an interest

they say, men do not have to work in front

want it to work, and it has to work right

in expanding their skin-cream horizons,

of a camera to place a higher premium on

away,” said Yeh.

they are likely to reverse themselves.

TO AVOID that pitfall, some products

involved in the category back in 2003 and

look better to be competitive,” said Celeste

are now taking their cues direct from frat

2004, we didn’t see that men were so quick

Hilling, the founder and chief executive

culture. Witness the new morning-after

to change their behaviour,” said Karen

of Skin Authority, a brand of skin creams

Rescue Gel produced by Nickel, a men’s

Grant, the senior beauty industry analyst

that introduced a men’s line in 2010.

skin-care line that has evolved into a chain

with the NPD Group. “The majority of men

At a time when job security is at a low,

“As much as everyone was getting

being presentable. “Men today say they feel they have to

of spas. This blue-tinted cream loaded with

still don’t know they have a skin-care issue.

for men jumped five per cent that year,

caffeine, coffee extract and soy protein

Because of that, they’re not necessarily

and rose another 12 per cent in 2011,

was designed as the beauty equivalent of a

feeling that they need to use a product

according to the NPD Group, a market

hangover cure. “It’s made for the morning

specifically designed for their face.”

research firm. Women buying products for

when you didn’t sleep the night before,”

men account for only 25 per cent of those

said Steven Morales, a spokesman at the

Sullivan said he still uses Irish Spring in

sales: Most of the time, men buy these

Nickel Spa in Chelsea. “The soy protein

the shower. And for every man like him,

products for themselves.

helps tighten the skin, and the caffeine

there are many more like Jaime Llorca, an

helps bring blood to the surface.”

engineer from Barcelona, Spain.

Sales of premium skin-care products

Looking to capitalise on the trend, manufacturers are again filling shelves

There are other signs that men are

Even with his $600 a year habit,

Two years ago, a female friend took him to buy premium skin products.

with creams designed for men. This time,

open to incorporating new products and

though, they are trying to avoid the too-

techniques if the items will make them

prissy mistakes of the previous decade.

look or feel younger. Sales of Botox and

months,” he said, and then never bought

other fillers for men increased 10 per

them again. The problem was not that he

products is so different than eight years

cent in 2010, according to the American

didn’t like or couldn’t afford the products.

ago,” Hilling said. “These guys who always

Society of Plastic Surgeons. But while

“I just didn’t see a difference,” he said. n

“The man today purchasing these

thought it was vain or too metrosexual” to splurge on beauty products “now think it’s almost a badge they wear to say, ‘I’m a modern guy because I care about my skin.’” A common theme among the new crop of men’s products is that they are multitaskers. Sunscreens double as moisturisers, and toners double as conditioners. Indeed, all the items in the Skin Authority Man line, including a daily sunscreen and a toner, are labelled “age-defying,” an acknowledgment that most men are not likely to buy a separate wrinkle reverser. “Men are very utilitarian,” Hilling said. When it comes to beauty routines, “they are willing to do two steps, not eight, like a woman.” Many men are wary of any product that will add time to their morning routine. They also tend to be more sceptical of overthe-top promises made by manufacturers. Even claims to halt aging can serve as a turnoff, said Blake Yeh, founder of Organic Regimens, another new line. February 2012

“These guys who always thought it was vain or too metrosexual” to splurge on beauty products “now think it’s almost a badge they wear to say, ‘I’m a modern guy because I care about my skin.’”

“I used them for maybe two, three

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Essentials

Profile

WINGS OF FORTUNE

Hans Wiesman likes to hunt for World War II warplanes. It’s a passion that’s taken him from the jungles of Colombia and the wilds of Alaska to the mosquito-soaked swamps of Puerto Rico and the army scrap yards of Madagascar, reports Andy Round.

H

ANS LIKES TO TRAVEL.

collection, the shark’s jaws, the aircraft

He likes to get into

memorabilia and the clutter of photos

adventures. And like a

– Hans as a boy on a Borneo airstrip;

21st-century Indiana Jones he’s a man

Hans partying with Patrick Swazye;

with a mission. This dedicated father of

Hans on motorbikes; Hans posing next

five with a Harley-Davidson obsession,

to a Dakota wreck…

a shock of curly hair and windsurfer

After a stint as a nightclub owner in

physique that defies his 65 years, hunts

his native Netherlands and 24 years

down ancient Dakota DC-3 aircraft

flying around the world seven months

for a living and converts the parts into

out of 12 as an international promotions

designer furniture.

executive for Rothmans “before tobacco

It means he gets to see the world.

advertising restrictions meant everyone

This self-styled ‘Dakota Hunter’ has

in marketing lost their jobs”, Wiesman

been threatened with kidnap by FARC

settled on a unique business plan.

in the jungles of Colombia, negotiated

“I had been sourcing old aircraft parts

with the wrong end of warlords’ guns in

to use as props to dress shop corners that

Madagascar, watched blood drain from

were selling Rothman’s Pall Mall clothing

Bolivian Dakotas, dodged grizzly bears

range,” he remembers. “Then one day my

in the wilds of Alaska and pulled wrecks

neighbour Dolph brought a shiny wing

out of mosquito-infested swamps. “It’s

tip from Miami, and we stumbled upon

better than staying at home,” he laughs.

the idea of converting the wing tips of

At a time when most pensioners

Dakotas into unique tables by stripping

might be considering a cruise for their

off the paint, polishing the aluminium

holidays, Wiesman is planning a trip to

and adding legs.”

Zimbabwe. He’s heard about a bunch

With Dolph as a partner, Avionart.

of Dakotas due to appear at auction.

com was created and since 1999 the

“Once they were used in anger against

company has sold 162 tables for prices

Mugabe, now they are being sold by

over ¤20,000. The only problem, of

him,” he chuckles over coffee.

course, is that supply is running out.

The walls of Wiesman’s apartment speak of a colourful life, the knife

Hans Wiesman travels around the world looking for Dakota DC-3 aircraft. He fashions parts of the plane into furniture.

Occasionally Wiesman will come across an abandoned Dakota on a remote Portfolio


71

airstrip – “something that is becoming

transporting drugs, tourists, weapons,

and when the family was relocated to

increasingly rare” – or race to an aircraft

cattle, pesticides, holidaymakers or troops

remote 1950s Borneo, the young aircraft

bone-yard to try and beat the scrap

for new civil war militias.

enthusiast would rush to the airfield

merchants who want to squeeze the last

“The number of usable wrecks is

whenever a Dakota was scheduled

dollar out of the old warbird by smelting

dwindling all the time, but there are

to arrive. Fuelled with the promise

it into ingots.

plenty of Dakotas still flying,” Wiesman

of packages from home and perhaps

says. “They connect communities. In

a coveted Dinky toy or two from his

THE DAKOTA is a real 75-year-old

Alaska, for example, they bring fuel, food,

grandparents, the Dakota came to

workhorse. It transported American

people and supplies to remote areas that

represent a connection to the outside

paratroopers during World War II,

would be lost without them. I’ve flown on

world, a romantic but vital link to

liberated countries across Europe, took

a Dakota to a goldmine town deep in the

modernity.

part in the Korean and Vietnamese wars

Colombian jungle. Everything that was

and played a key role in the Berlin airlift.

used to start the community was brought

Wiesman to visit some of the most

After being decommissioned its reliability,

there by Dakota.”

inhospitable places in the world using

It’s a romance that has inspired

a complicated network of informers,

light weight, easy maintenance and big

The Dakota as a reliable lifeline is

balloon tires that made it easy to land

something that Wiesman knows only

enthusiasts and military men to help him

anywhere was found to be perfect for

too well. His father worked for Shell

in his quest. “In Madagascar I soon realised

February 2012


72

Dakota's, thanks to their sturdiness, simplicity and ability to land almost anywhere, are still in use around the world. The first DC-3 flew in 1935.

that the collection of five former World

The warlord was not happy when we met

him across the continent, but it was in

War II Dakotas donated to the air force

again… we left pretty quickly.” Then came

Colombia that he struck Dakota gold. The

by the French was effectively owned by a

revolts, violence, civil war, the warlord

first time he arrived in 2006, he attempted

militia warlord,” laughs Wiesman.

disappeared and the Dakotas were

to go south from Bogota to the wild jungle

chopped into pieces for scrap and smelted

frontier city of Villavicencio. “I was given a

to buy them off the ‘colonel’ and he said

down for a few dollars. “It’s a sad end for

pass for two days because the military said

he would give them to me in exchange

such historic aircraft.”

I was simply too easy a FARC kidnap target

“After two years of negotiations, I tried

for a $250,000 Piper Navajo. He was

and it would take around 48 hours for

serious, so I then went to the Defence

WIESMAN HAS enjoyed better luck in

someone to report me, for a taxi to pick me

Ministry that actually owned the aircraft.

South America. His adventures have taken

up and for me to disappear into the jungle until a ransom was paid.” Three years later the violent drug wars that had fuelled so much national anguish were starting to recede and more importantly, the Dakotas that had been used for trafficking had been seized by

Wiesman with the wreck of a Dakota he found in Yukon, Canada. Although more than 16,000 DC-3s were built in total, it is getting harder to find them today.

“I found 12 wing tips there and a lot of US-trained Colombian pilots wearing night goggles, flying helicopters at midnight and using heavy guns to flush out armed drug gangs and guerrillas.” Portfolio


Essentials Profile the military. Wiesman was on the next plane out. “I found 12 wing tips there

cheap and easy way to transport essentials.

two tips but was stopped from taking

In Florida, Wiesman hired a crane to

more by the air force. It was a bitter

and a lot of US-trained Colombian pilots

pull a decrepit 1944 war veteran Dakota

disappointment made worse by the news

wearing night goggles, flying helicopters

from the mosquito-infested Tampa swamp

that violent currents tore the aircraft from

at midnight and using heavy guns to flush

and sold the cockpit to a Dutch museum;

their submerged mooring and drifted out

out armed drug gangs and guerrillas.”

in Puerto Rico another swamp-dwelling

to open sea.

The huge balloon tires of the Dakota

Dakota was found to contain a cargo of

and an engine maintenance that even a

dangerous killer wasps and had to be

BY THE time Wiesman set out for Alaska

car mechanic can pull off make it ideal for

abandoned. In Thailand, five Dakotas

in 2007 he feared that his worldwide wing

landing on non-existent airstrips and for use

were sunk to create an artificial reef for

tip supply was drying up. He visited crash

by remote communities struggling to find a

divers. Wiesman was able to salvage

sites, scrap yards and followed stories of mythical Dakotas lost in the mists of legend. At one stage he even scoured the grizzly bear populated Ruby Mountains by helicopter where he came across a Dakota that had lost engine power in 1950 and been forced to glide into a crash landing on the snow. It was in remarkable condition and as bright silver as the day it was manufactured. All 10 people on board escaped alive after the pilot walked through eight miles of snow to the Alaska Highway. “But still no wing tips. With so many grizzlies around and with the mist starting to fall we got in the helicopter and left. I’d

Wiesman has a network of enthusiasts, military men and informers who let him know where to find DC-3s. Most of the aircraft are about to be scrapped, so he’s always in a race against time.

thought Alaska would be a great source of wing tips, but no luck, so I decided to go to Canada where I had spent weeks meeting the operators of Dakotas still in operation. Then on the last day in an old barn that contained vintage cars and old wrecks there were 12 wing tips hidden by dust. It was an incredible moment.” Wiesman grins. “You win some you lose some.” n

The end result of Wiesman’s search around the world are tables made from Dakota wingtips. The tables sell for more than €20,000. February 2012

Wiesman aboard a decommissioned DC-3. It is estimated that there are around 400 still flying worldwide.

73


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Essentials

Culture

Concocted Languages

In Demand In an effort to add reality, Hollywood and TV studios are ordering new languages such as Dothraki and Na’vi to complement fantasy and sci-fi releases, reports Amy Chozik.

Portfolio


Essentials Culture

Dothraki, an invented language for the HBO series Game of Thrones, started with a vocabulary of 3,250 words.

A

T HIS BEST FRIEND’S

a 30-year-old who studied linguistics at

characters greet each other by saying

wedding reception on the

the University of California, San Diego,

“M’athchomaroon!” (hello), give each

California coast, David Peterson

is a ‘con-langer,’ a person who constructs

other commands like “Azzohi haz khogare”

stood to deliver his best-man toast to the

new languages. Until recently, this mostly

(put down that cask) and occasionally

newlyweds. He held his champagne glass

quixotic linguistic pursuit, born out of

utter sentiments like “Vezh fin saja

high and shouted “hajas!” The 50 guests

a passion for words and grammatical

rhaesheseres vo zigereo adoroon shiqethi!”

raised their glasses and chanted “hajas!”

structures, lived on little-visited websites

(the stallion that mounts the world has no

in unison.

or in college dissertations.

need for iron chairs!) that don’t seem to

© 2011 NEW YORK TIMES NEWS SERVICE

The word, which means “be strong” and

Today, a desire in Hollywood to infuse

make sense in any language. “The days of aliens spouting gibberish

is pronounced “hah-DZHAS,” has great

fantasy and science-fiction movies,

significance for Peterson. He invented

television series and video games with a

with no grammatical structure are over,”

it, along with 3,250 other words (and

sense of believability is driving demand

said Paul Frommer, professor emeritus of

counting), in the language he created for

for constructed languages, complete with

clinical management communication at

the HBO fantasy series Game of Thrones,

grammatical rules, a written alphabet

the University of Southern California who

called Dothraki.

(hieroglyphics are acceptable) and enough

created Na’vi, the language spoken by the

vocabulary for basic conversations.

blue inhabitants of Pandora in Avatar.

Some people build model railroads or re-enact Civil War battles; Peterson,

February 2012

In Game of Thrones, Dothraki-speaking

Disney recently hired Frommer to develop

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Essentials

Culture

a Martian language called Barsoomian

There have been many attempts to

for John Carter, a science-fiction movie

create languages, often for specific

premiering in March.

political effect. In the 1870s, a Polish

The shift is slowly transforming the

doctor invented Esperanto, meant to be

obscure hobby of language construction

a simplified international language that

into a viable, albeit rare, career and

would bring world peace. Suzette Haden

engaging followers of fantasies like Lord

Elgin created Laaden as a language better

of the Rings, Game of Thrones and Avatar on a more fanatical level. At Game of Thrones viewing parties in San Francisco, fans rewatched Dothraki scenes to study the language in a workshop-like setting. Last October, a group of Na’vi speakers from half a dozen countries convened in Sonoma County, California for a gathering known as ‘Teach the Teachers’. Frommer gave attendants tips on grammar and vocabulary and fielded any questions they had about the language. The rural, wooded setting felt “almost like being on Pandora,” he said. At a question-and-answer session last July that he participated in, at least a dozen attendants rattled off their questions in fluent Na’vi. “There’s been a sea change in Hollywood. They realise there’s a fan base out there that wants constructed languages,” said Matt Pearson, a linguistics professor at Reed College in Portland, Oregon. He created Thhtmaa (pronounced tukhh-t’-mah), the language of termite-like aliens in the short-lived NBC series Dark Skies.

suited for expressing women’s points

Game of Thrones, based on the bestselling novels A Song of Ice and Fire by George R.R. Martin, may be the biggest television showcase for an invented language. The books, which primarily follow feuding kingdoms in the fictional land of Westeros, had a scattering of Dothraki words, but the show’s executive producers wanted a fully formed language. Several scenes in Game of Thrones take place entirely in Dothraki with English subtitles. In one episode the shirtless tribal leader Khal Drogo delivered a monologue for two and a half minutes in Dothraki, with its subject-verb-object structure and no copula, or linking verb.

of view. But none of the hundreds of languages created for social reasons developed as ardent a following as those created for movies, television and books,

Klingon, a language that was created by Marc Okrand for Star Trek III, has spawned a whole industry ranging from Monopoly to dictionaries.

THE MOTIVATION to learn an auxiliary language isn’t so different from why people pick up French or Italian, she said. “Learning a language, even a natural language, is more of an emotional decision than a practical one. It’s about belonging to a group,” she said. Richard Littauer, a 23-year-old linguistics graduate student at the University of Saarland in Germany, maintains Dothraki.org, complete with an David Peterson invented the Dothraki language.

“For years people have been trying to engineer better languages and haven’t succeeded as well as the current era of language for entertainment sake alone.” says Arika Okrent, author of In the Land

of Invented Languages. “For years people have been trying to engineer better languages and haven’t succeeded as well as the current era of language for entertainment sake alone,” Okrent said.

English-Dothraki dictionary and grammar guidelines. “I was raised watching Pocahontas speak fluent English,” Littauer said. “Linguistic diversity is one of the main ways you feel like you’re in a new culture.” The watershed moment for invented languages was the creation of a Klingon language by the linguist Marc Okrand for

Star Trek III: The Search for Spock (on the original Star Trek television series, Klingons spoke mostly English). That led to a Klingon Language Institute (a registered nonprofit), a Klingon version of Monopoly, an official dictionary and a published translation of Hamlet. (The Klingon race does not worship in the traditional sense, so instead of Hamlet going to pray, he does calisthenics.) Klingon, with its throaty, harsh sound, is notoriously tough to pick up. Even the creator has problems. (“I’ll admit, I’m not a very good speaker,” Okrand said in an Portfolio


Essentials Culture letter combinations and sounds he liked. His favorite sound is “JH” as in “genre,” so he made the word for man in Dothraki mahrazh. “I said to myself, if I won the right to coin the word man, it better be cool,” Peterson said. After he amassed a small vocabulary, Peterson tested out basic grammar. He adored the 18 noun classes in Swahili and the negative verb forms in Estonian, both influences in his created languages. He scribbled sample sentences and added suffixes and prefixes to expand the vocabulary. He aims to eventually grow A language called Na’vi was created by Paul Frommer for the movie Avatar. Some fans can speak the language fluently.

Dothraki to around 10,000 words – or about the equivalent of college-level foreign language proficiency. In addition

interview.) Fewer than 20 people are fully

horse (including “hrazefishi” for a teeny-

to the Dothraki site, there is an official

fluent in Klingon, though thousands more

tiny horse).

Na’vi grammar guide run in part by

know enough to get by.

Next, Peterson tried to establish

William Annis, a 42-year-old who works

words that would be native and basic

in information technology in Madison,

Language Creation Society, the first

(meaning they are not derived from

Wisconsin. He occasionally consults with

professional organisation for people who

another Dothraki word), toying with

Frommer, Na’vi’s creator.

In 2007, Peterson helped found the

create languages. He won an open call to create a language for Game of Thrones. He submitted a 180-page proposal complete with a dictionary and audio files of spoken Dothraki judged by a double-blind committee of other language creators and finally, by the executive producers. It’s not the first language Peterson has come up with. Before Dothraki, he invented 12 others, including his personal favourites: Zhyler, inspired

“There are the language nerds who just find grammar interesting and the Na’vi folks who paint themselves blue and go to conventions.”

But as with any language, there is a certain snob appeal built in. Among Dothraki, Na’vi and Klingon speakers, a divide has grown between fans who master the language as a linguistic challenge, and those who pick up a few phrases because they love the mythology. “There are the language nerds who just find grammar interesting and the Na’vi folks who paint themselves blue and go to conventions,” Annis said. n

loosely by Turkish, and Kamakawi, which nods toward Hawaiian. DOTHRAKI came with its own challenges. Martin’s books described the Dothraki people as nomadic warriors who live in grass fields and survive mostly on horsemeat. “First you say ‘Should this word exist at all?’” Peterson said. He decided that the Dothraki, with their long braids, or “jahaki,” wouldn’t have a word for toilet, cellphone or even book since that implies they have a printing press. The Dothraki do however have more than 14 words for February 2012

Invented movie languages have spawned a whole sub-industry.

77


78

TRACKING AN ANCIENT

WATER SOURCE

An isotope known as krypton 81 has been instrumental in unravelling the mysteries of the Nubian Aquifer, reports Felicity Barringer.

Water from the Nubian Aquifer is used to make the Libyan desert bloom. Portfolio


Essentials Technology

79

THE NUBIAN AQUIFER, THE font of fabled oases in Egypt and Libya, stretches languidly across almost two million square kilometres of northern Africa, a pointillist collection of underground pools of water migrating, ever so slowly, through rock and sand toward the Mediterranean Sea. The aquifer is one of the world’s oldest. But its workings – how it flows and how quickly surface water replenishes it – have been hard to understand, in part because the tools available to study it have provided, at best, a blurry image. Now, to solve some of the puzzles, physicists at the Department of Energy’s GETTY IMAGES

© 2011 NEW YORK TIMES NEWS SERVICE

Argonne National Laboratory in Illinois have turned to one of the rarest particles on earth: an elusive radioactive isotope usually ricocheting around in the

Cleopatra’s Bath, at the famed Siwa Oasis in Egypt, is fed by water from the Nubian Aquifer.

atmosphere at hundreds of kilometres an hour. Their first success was in distilling these elusive isotopes, krypton 81, from the

water in the huge Nubian Aquifer, part of

older bodies of water had long been

which lies 3.2 kilometres below the oases

elusive. Carbon 14 dating, so useful in

of western Egypt where temples honour

archaeology, reaches back just 50,000

Alexander the Great. Their second was in

years or so.

holding these isotopes still and measuring how much they had decayed since they last saw sunlight. Knowing how long water has

It is now clear that the Nubian Aquifer has been a million years in the making. “For decades we have been looking at different means of fingerprinting water,”

been underground helps researchers

Aggarwal said. “We used a bunch of

understand how fast aquifers are

different isotopes – stable isotopes – to

recharged by surface water and how fast

trace where the rain comes from. We

they move, leading to more accurate

also used the radioisotopes to figure how

geological models. Groundwater is

quickly groundwater moves.”

becoming an increasingly crucial component of the world’s available fresh

FOR YEARS, scientists had relied on

water, and the findings could significantly

carbon 14 dating indicating the aquifer

increase understanding of how it behaves.

was just 40,000 years old. They knew

Pradeep Aggarwal, who runs the isotope

February 2012

that krypton 81, an isotope present in the

hydrology section of the International

open air but not underground, would be

Atomic Energy Agency’s water resources

a better marker for the forensic work of

programme, said that success in tracking

tracking underground water’s movement.


80

Essentials

Technology

When water loses contact with air, the radioactive clock starts; the isotope decays by a factor of two every 230,000 years, and the decay is measurable as far back as two million years. But the krypton 81 isotopes were devilishly difficult to isolate and even more difficult to catch. Zheng-Tian Lu, a physicist at the Argonne laboratory, and his colleagues have spent 14 years mastering and extending techniques to slow down atoms, the same laser-based techniques that were pioneered by the current energy secretary, Steven Chu, in the 1980s, and for which he won a Nobel Prize. When Lu realised the potential benefit of isolating krypton 81 isotopes, “I got

“We used a bunch of different isotopes – stable isotopes – to trace where the rain comes from. We also used the radioisotopes to figure how quickly groundwater moves.” hooked on the problem,” he said. “I tried to use the trapping method I’d already learned to try and solve the radio-krypton dating problem. We are combining the ability to control and manipulate atoms to select krypton 81 out of a million kinds of

Argonne physicist Zheng-Tian Lu (in back) and his team (from left to right) Arjun Sharma, Wei Jiang, Kevin Bailey, and Guomin Yang stand with the ATTA device, which measures individual atoms of the isotope krypton 81 as part of an effort to model underground aquifers and predict how fast they refill.

krypton isotopes,” he added. There is one

slow down, giving scientists an easier

implications about how to manage waters

krypton atom in every million molecules

target to isolate.

today.” He added, “To manage a water

of water; one in a trillion of these krypton atoms is the krypton 81 isotope.

The process begins when water is extracted from the aquifer without any

resource you need to build a realistic hydrology model.”

The key, he said, is using lasers to

contact with air. Krypton is bled from

pinpoint the frequency at which atoms

the water into a vacuum system. Once

THAT IS where Neil Sturchio, a

oscillate – a loose equivalent of trying to

identified and slowed, the krypton 81

geologist at the University of Illinois

determine the exact pitch of a musical

isotopes are trapped by six laser beams

at Chicago, comes in. He works with

note. Detecting the infinitesimal

focusing on them from the four cardinal

the most accepted model of how water

differences in isotopes’ resonance is hard,

points of the compass and from above and

flows through the Nubian Aquifer. “The

but when done, lasers can be tuned to

below. Then their decay can be measured.

reason this model was done,” he said, “is

pick up each isotope’s frequency. When

“From this aging information, you

that there is an international agreement

krypton 81 atoms go through a laser

are looking at how the water flowed in

among the countries that share this water”

attuned to them, they glow brightly and

the long past,” Lu said. “But it does have

– Egypt, Libya, Chad and Sudan. Portfolio


Essentials Technology

The Great Man-Made River is a network of pipes that supplies water from the Nubian Aquifer in the Sahara Desert to Libyan cities and fields. Such major usage makes it essential to be able to calculate the extraction rates of water.

“The issue is if Libya is starting to pump

the International Atomic Energy Agency

useful, he predicts. In addition to being applied

their water seriously and Egypt is doing

pointed out: “As a result of the drawdown

the same thing in their oasis areas, what

we have dried up the oases in a couple

to other aquifers in places like the

happens to the rest of the aquifer? If heavy

of places. In Libya they have dried up

Philippines and Australia, the krypton

pumping comes too close to a coastline,

Kufra Lake.” In 1920, he said, National

81 techniques are being explored as

saltwater may be drawn into the hydrologic

Geographic published a picture of the

a way of tracking underground brine

depression created by the pumping.”

lake at high water. “Right now it is a dry

in places like southeastern New Mexico,

bed, because they are pumping so heavily,”

where radioactive waste from ships,

he said.

submarines and aircraft carriers is

The Nubian Aquifer is not exactly running dry; it is filled with the equivalent

And even though the aquifer is huge,

“As a result of the drawdown we have dried up the oases in a couple of places. In Libya they have dried up Kufra Lake.”

its recharge rate, at best, “is measured in

stored underground. In the end, management of nuclear

millimetres per year,” Aggarwal said – tiny

waste, like management of water, is a

compared with what is being pumped out.

political matter.

In addition, Sturchio said, there

“There are a lot of different calculations

remains the question of how best to

that go into exploiting a resource,”

extract water: “where you put wells, how

Aggarwal said. “In most cases, decisions of

deep, how close to each other. If you

whether to use or not to use, or how much

design it the right way, you can get a lot

to use, are social, political and economic

more water without problems,” he went

decisions.” Still, he said, “the more reliable

of more than 500 years of Nile River flow;

on. “But if you put all the wells in one

info we can provide for making those

the groundwater in the Egyptian portion

spot, you could be causing yourself a lot

decisions, the better off we are – what

alone is estimated to exceed 41,681 cubic

of trouble.” Water managers around the

we want to do is get the most accurate

kilometres. Nonetheless, Aggarwal of

world will find the team’s information

information possible.” n

February 2012

81


Essentials

82

Culture

A GOTHIC TOUR OF ITALY Italy might be sunshine and happiness, but it also has a darker side that inspired the original Gothic writers, reports Nina Burleigh.

V

ISITORS TO ITALY TEND TO

locations in Italy piqued different aspects

seek its sunny, Dionysian side –

of the imagination. Venice seemed to hold

vino, pasta, opera, cinquecento

special appeal for those wishing to mine

art. But, like a chilly draft on a hot day, Italy’s gothic angle offers intimations of

I decided to start my tour in Otranto,

darkness that make a moment on the

a white, cobbled seaside town on the

piazza even more delicious. Consciously

Adriatic edge of Italy’s boot heel, and the

or not, anyone sipping prosecco at sunset

setting for what’s regarded as the first

in Rome or Naples savours an extra spoon

Gothic novel, The Castle of Otranto by

of dolce in their vita thanks to the contrast

Walpole. I had visited the town briefly

between the beauty of the present and the

one summer afternoon with children in

proximity of catacombs, ruins and sites

tow. Returning in late autumn, I found

of ancient suffering.

the formerly bustling streets chilly and

The original Gothic writers were much

silent – not as inviting, perhaps, but more

inspired by the duality in the bel paese

in keeping with the intimations of its

(beautiful country). Edgar Allan Poe,

macabre history that I had been reading

Nathaniel Hawthorne, Horace Walpole,

about in guidebooks.

Ann Radcliffe and other masters of the

Otranto, I had learned, is literally

Lining shelves on a wall off to the side

romantic and horror genres set some of

haunted by an old act of evil: a

were 800 human skulls – victims of

their most famous works in Italy.

15th-century massacre that Otrantans

invading Turks.

“Italy was the Gothic writers’ favourite

commemorate annually to this day.

The Castle of Otranto was a publishing

background,” wrote Massimiliano Demata,

“Local history is filled with blood and

phenomenon in 1764. Walpole’s short tale

a professor at the University of Bari,

darkness,” an Otranto guide and historian,

describes the supernatural punishment

who has made a study of the form. The

Francesco Calignano, told me as he led me

of an usurping Italian feudal prince in a

country’s baroque portas, ruined castles,

into the Cathedral of Otranto.

haunted castle packed with what we now

eerie reliquaries and catacombs were a

© 2011 NEW YORK TIMES NEWS SERVICE

pre-Freudian psychological terror.

The cathedral is known for its complex

consider standard fright stock – secret

gateway to the uncanny, possessing, as he

mosaic floor, which depicts scenes

doors, gloomy tunnels, haunted suits of

put it, “a labyrinthine and claustrophobic

from just about every human myth and

armour, portraits of ancestors jumping

architecture that was the novels’ perfect

legend known to the world circa AD

out of their frames. At the time, though,

physical and psychological setting.”

1100, including kabbalah’s tree of life,

these images were so fresh and shocking

Today, these same books can serve as

Confucianism and Puss in Boots.

that Walpole’s little book became an instant best seller in England.

unconventional guidebooks for tourists

We entered on a raw, late-autumn

who tire of the sun and want to explore

morning, and we were the only people

the country’s macabre past.

inside. After admiring the beautiful floor,

seductive pleasures, where a warm

I was led to a truly Gothic spectacle:

afternoon can be passed bathing in azure

For the Gothic writers, different

Modern-day Otranto is a place of

Portfolio


83

The Roman Forum in Rome. Part of Italy’s attraction is that you are never far from catacombs, ruins and ancient suffering; a fact that greatly influenced the original Gothic writers.

The mosaic floor in the Cathedral of Otranto, which depicts scenes from almost every human myth and legend known to the world circa AD 1100. February 2012


84

Ann Radcliffe set her best-known novel, The Italian, in Naples. There are numerous Gothic sites just a short wander from the famed Via Toledo shopping street.

seas and gorging on nouvelle Italian

castle keep, a shadowy ruin and creepy,

suburb called Secondigliano. I crossed it

seafood. I paid a few euros and toured

robed stalkers. The plot is simple enough:

off the to-do list, reluctantly.

the castle’s white corridors alone, seeking

A young nobleman of Naples falls in love

signs of Walpole’s ghosts, peering into

with a girl of whom his mother strongly

worth a visit, if only because searching

small, empty, barred rooms, any one of

disapproves. The mother hires an evil

for them allows one to wander the city’s

which could have been a dungeon. On the

monk to do away with her, but the monk

streets, noting the many other Gothic

outside, it is a photogenic and perfectly

discovers that the girl is actually his

charms of Naples that Radcliffe missed.

preserved white fortress. But its turrets,

daughter – the product of an illicit affair.

The book’s lovers, Vivaldi and Ellena, first

gunwales and wide, waterless moat attest

The novel opens with an Englishman

Radcliffe’s other Neapolitan sites are

lay eyes on each other at the church of

to the inhabitants’ defensive terror of the

surveying the Naples church of Santa

San Lorenzo Maggiore, which still stands

invader hundreds of years ago.

Maria del Pianto, which Radcliffe

in Naples’ historic centre – a yellow and

wrote housed “the very ancient convent

grey hulk with an archaeological site

A SHORT flight or a five-hour train trip

of the order of the Black Penitents.”

underneath it.

west across the heel of Italy to Naples

Contemporary visitors can test Radcliffe’s

allows ample time to dig into the works

Gothic imagination against the lively

for my trip I took along The Marble Faun,

of a lesser-known Gothic master,

reality of the teeming city. The church of

by Hawthorne. Hawthorne was reaching

Radcliffe. She was a reclusive

Santa Maria del Pianto is still there, but

the end of his career as a master of the

Englishwoman who like Walpole was

it’s not on any tourist map. It does still

psychological and supernatural horrors of

celebrated in her day for novels, many of

exist, but in what is now a crime-infested

Puritan New England, and this novelistic

Rome is rife with Gothic locations, and

which were set in Italy, that pit seemingly supernatural forces of evil, often associated with Catholicism or small-time feudal tyrants, against guileless young women and their brave, thwarted lovers. Radcliffe’s best-known novel, The Italian, takes place in 18th-century

“Radcliffe’s best-known novel, The Italian, takes place in 18th-century Naples. Almost every page contains a castle keep, a shadowy ruin and creepy, robed stalkers.”

Naples. Almost every page contains a Portfolio


Essentials Culture travelogue is not his best. A two-volume

berating a group of Germans who were

near the roses strewn by worshippers, in

compendium of some of the eerie sites,

ignoring the signs about turning off their

five languages, reminds happy tourists to

it is a meandering tale of three American

cellphones. “Listen,” she exhorted them

drink deeply from the cup of Italy’s joys

artists working in Rome who meet and

in English. “The cellphone lines are too

now, as the eternal shadow looms: “What

befriend a real-life satyr, who seems to

strong for the human bones here. They

you are now we used to be. What we are

have been the flesh-and-blood model for a

are really delicate.”

now you will be.”

The crypt is tiny and claustrophobic,

Back upstairs and on the streets

and the bones’ sickly sweet smell fills a

of Rome, the pleasures of Italy are

packed Capitoline Museums today will find

dimly lighted passageway winding past

immediate and accessible, but also

many statues of the faun, associated with

eight gated displays with arabesques of

complex. Without the darkness, the

Dionysus, who represented the animal in

thousands of bones arranged by type –

country might be as bland as Sweden.

man, simultaneously innocent and lawless.

fingers, patellas, femurs, knuckles, skulls

Looking at Italy through the gothic lens

The faun’s more threatening relative, the

– in lacy flowers, garlands, clocks or urns,

deepens our appreciation of the pain,

satyr, is overtly Luciferian, with horns and

attached to walls and ceiling. In the final

suffering and death that is, along with

cloven hooves. A large satyr of this type

room, the message posted on the floor

love, ease and light, also man’s lot. n

Girls shop at a flea market in Rome after a visit to the catacombs.

The Head of Medusa by Bernini at the Capitoline Museum in Rome.

marble statue in the Capitol. Visitors to the gloriously treasure-

85

glares archly out from a cupboard in the Egyptian courtyard of the museum. A BUS ride or a leisurely stroll across Rome’s historic centre leads the traveller to another principal site in The Marble Faun – the creepily gorgeous Capuchin Catacombs, where the Hawthorne characters confronted an evil monk. Decorated in Baroque style with the white bones of 4,000 dead monks, the Capuchin Crypt near the luxurious Via Veneto is today a popular stop on any Rome tour. As macabre as it seems, it’s also a sacred site. No cameras, no hats and no summery clothes are allowed. “Tell the Americans, no spaghetti straps,” said Alba, the stern receptionist

“Decorated in Baroque style with the white bones of 4,000 dead monks, the Capuchin Crypt near the luxurious Via Veneto is today a popular stop on any Rome tour.” February 2012

GETTY IMAGES

on duty the afternoon I was there, while

Radcliffe’s lovers in The Italian first set eyes on each other in Naples’ San Lorenzo Maggiore, which still stands in the centre of town today.


86

Essentials

Test Drive

AMERICAN MUSCLE The Camaro SS isn’t subtle with a 6.2 litre V8 engine that hits 0-100km/h in 5.4 seconds. And that’s exactly what’s great about it, reports Guido Duken.

IF YOU PREFER CAVIAR TO STEAK

generally refers to American-made two-

and Mozart over Bruce Springsteen, you

door sports coupes with powerful engines

can stop reading now. The Camaro SS

designed for high-performance driving.

is not for you. This is an unpretentious,

It is this DNA that underlies Chevrolet’s

no holds barred American muscle

Camaro and Corvette, the Ford Mustang

car. Subtlety isn’t its strong point, but

and the Dodge Charger.

performance is. Plus it comes with a pedigree that dates back to 1966. In the 1950s hot rodding was all the rage

Besides being wickedly powerful and fast, early muscle cars were known for one major shortcoming: they didn’t corner

as Americans stuck large, modified engines

well. That was fine in drag races, but not

into old car chassis and went drag racing

very practical nor safe in every day use.

on abandoned airfields, tracks and public

That thought is uppermost in my mind

gripping solidly and I become increasingly

roads. It didn’t take long for American car

as I throw the Camaro SS into a tight

more daring as I accelerate through the

manufacturers to realise that the youth

corner at a relatively fast speed. Will the

corners. Myth busted, the Camaro can

market was crying out for affordable cars

tail go out and send me into a spin? Nope,

corner with the best of them. I love the

with big engines. And so it came to pass

not at all! The rear end stays perfectly

thick steering wheel that’s easy to grip, the

that ‘muscle cars’ were born, a term that

in line with the front, the 20-inch tires

steering resistance feels like it should and the feedback is spot on. There is one thing that puzzles me though, where’s the muscle? After all, the Camaro SS has a 6.2 litre V8 that’s good for 400 horsepower and 567Nm of torque when coupled with the six speed automatic transmission. And yes, when I put my foot down it goes down a gear, there’s a surge of power, and then it changes up and goes back to normal. It seems a different approach is called for. So, kick down the accelerator and keep it floored and yes, that’s what I’m expecting. A V8 growl, the gears change on the red line, and the Camaro’s broad snout is eating the road. This is pure testosterone-driven fun.

The orange and black interior of the Camaro SS gives it a sporty feel. The instrumentation is designed and placed to invoke a retro feel.

Talking about testosterone, my carloving wife who gets way more speeding Portfolio


87

The Camaro has an aggressive exterior that matches its performance.

I drove the Camaro for four days, and

fines than me, doesn’t get the Camaro at

demonstration of the Camaro’s power,

all. “Too plastic,” she says. And she’s got a

speed and cornering ability. She might be

every day I liked it more. But it puzzled

point. The bonnet is plastic, the door inlays

a good driver, but she’s a rotten passenger.

me, what exactly was it that I liked? Somehow, I couldn’t distil it into words.

plastic, the binnacle surrounding the funky retro gauges is plastic as well. Not good

ON THE plus side, the four-piston

Sure, I loved flooring the accelerator

plastic, but the cheap looking kind that

Brembo brakes have the required stopping

and watching cars disappear in the rear

shoudn’t be in a $59,000 car.

power, the four-wheel independent

view mirrors. Yes, it was pleasing to see

performance suspension is tuned right, and

motorists scuttle out of the way of the

signature hood bump as she rightly says

the six-speed automatic gearbox does its

Camaro’s Tiger shark mouth. After a while

it makes its difficult to see the road edge.

work well. And the eight speaker, 245 watt

I didn’t care about the plastic anymore

Lucky for her the Camaro has six-way

Boston Acoustics system is indeed music

and I stopped looking at the fuel gauge.

electric seats that raise and lower the

to one’s ears. Plus the SS is loaded with lots

driving and passenger positions, otherwise

of goodies such as remote keyless entry,

lot for the last time I felt a twinge of

she wouldn’t have been able to look over

front Sport bucket seats, tire pressure

sadness. That’s when it finally dawned

the steering wheel. The rear view is also

monitoring system and multifunction

on me. In this age of frugal four-cylinder

limited, the back seats as useful as those

steering wheel to name a few.

turbo engines, V8 American muscle

She also doesn’t like the Camaro’s

in a Porsche 911, and the boot-size isn’t

The Camaro’s exterior appearance

As I drove the Camaro into the parking

cars are an anachronism. The Camaro

exactly generous (but it does have a glow

screams American muscle with its strong

harks back to better days when global

in the dark emergency release, in case you

lines and it has the aggressive stance to

warming wasn’t an issue, subprime

ever lock yourself in your boot. Only in

match its performance. More than once I

mortgages hadn’t been invented yet and

America). And, like most ragtops, there’s a

saw people looking at the car and talking

the American dream was alive and well.

lot of wind noise once you hit 120.

animatedly. With the power folding roof

In short, the Camaro takes you to a better

down it looks even better. The Camaro

place and time. Isn’t that the whole reason

definitely has presence.

for buying a car in the first place? n

Mind you, her eyes do open wide and her knuckles go white when I give her a February 2012


Essentials

Other Business

Fishy Record Tsukji fish market in its first sale this year,

broke the previous record. The previous record price had been

which has become a

set on the same market in January

part of the country’s

2011, when a 342kg fish fetched 32.49

New Year celebrations,

million Yen (£257,320). Japan consumes

and was bought by the

more seafood than any other country

owner of a Japanese

including around 80 per cent of the

sushi chain.

Pacific and Atlantic Blue Fin tuna

The price paid also sets a new record REUTERS

88

caught. Pacific Blue-fin tuna are currently

price by weight, with

not considered to be endangered despite

each kilo being worth

pressure from fishing, unlike its cousins

A 269kg Pacific Blue-fin tuna became

£1,755. With sushi consumption on the

the Atlantic Blue-fin and Southern Blue-

the world’s most expensive fish after

rise worldwide, particularly in China,

fin, which are considered ‘endangered’

it was sold for 56.49 million Yen

demand is outstripping supply, so it was

and ‘critically endangered’ respectively

(£472,125) at a Japanese fish market.

no surprise when the giant specimen,

on the IUCN Red List of Threatened

The giant fish was sold at Tokyo’s

caught off Oma, in Aomori prefecture,

Species.

Digital Pirates Get Religion One of the most wired nations in the world, Sweden has long been a battleground between those who support file-sharing and the music and film industry. The Nordic state gave birth to the world’s largest file-sharing website, Pirate Bay. Now another symbolic blow has been struck as

is a way to avoid “persecution,” said the website

Historic Penny Mints a Million

of the group. The group’s logo incorporates

A one-cent copper coin made at the Mint

because it wasn’t in circulation. Officials

‘Ctrl-C’ (copy) and ‘Ctrl-V’ (paste).

in Philadelphia in 1793, the first year that

say it shows no wear on its lettering, its

the US made its own coins, has sold for

Lady Liberty face or the chain of 13

‘copy me’ and as its website makes clear it

a record $1.38 million at a Florida

linking rings on its back.

strongly supports all forms of downloading

auction.

the Swedish government has recognised a group that promotes file-sharing across the internet as a religion. Registering the Church of Kopimism

Kopimism’s name is derived from the words

and uploading files and sees copyright laws as violating freedom of information. Ludvig Werner, head of the Swedish branch of recording industry body IFPI, declined to comment on Kopimism but noted that 1.5

James Halperin of Texas-based

“This coin is known as a ‘Chain Cent’ because the central design on the back is

Heritage Auctions said that the sale was

a chain of 13 linking rings. It represented

“the most a United States copper coin

the solidarity of the 13 original colonies,

has ever sold for at auction.”

but some critics claimed the chain was

Halperin said there remain a few

symbolic of slavery, and the design was

million people in Sweden out of a population of

hundred 1793 coins in different condition,

quickly changed from rings to a wreath,”

nine million were active file-sharers.

but that the one auctioned off is rare

Halperin said. Por tfolio


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Portfolio | February 2012  

Portfolio | February 2012

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