CNBC Business | Dispatches

Dispatches

ENERGY : Britain and Abu Dhabi combine on clean-tech  

Britain and an Abu Dhabi renewable energy company are to sign an agreement to cooperate on clean energy technologies. British Prime Minister Gordon Brown confirmed the deal to work with Masdar, to develop and deploy low-carbon technology for energy during a visit to the UAE in November. He said the deal would cover wind and solar energy as well as carbon capture and storage. During Brown’s recent visit to neighbouring Qatar, the Gulf state agreed to invest €185m in a British low-carbon energy technology fund. The investment will be topped up with €12.5m by Britain’s Carbon Trust and another €115m from private investors. In October, Abu Dhabi state-run Masdar said it was taking a 20% stake in the London Array offshore wind farm project for an undisclosed sum. Masdar has been set up by the Abu Dhabi government. It aims to ensure a leading role in the future energy industry for the emirate, holder of 90% of the UAE’s oil reserves. 

LUXURY : Sector feels the pinch 

The luxury goods market is expected to slow this year and possibly downturn in 2009 as the global crisis and weak consumer confidence hit the sector. According to a study by Bain & Co, presented at the Altagamma luxury goods conference, a strong slowdown is expected for the last quarter for the personal luxury goods market, which includes shoes, jewellery and fashion. Italian jeweller Bulgari warned in September that it expected Christmas sales to be poorer this year than last. The luxury sector is estimated to reach €175bn in 2008, up 3%, following a 6.5% growth last year. Claudia D’Arpizio, a partner at Bain & Co, said the economic meltdown will not have a devastating effect because of the appreciation of the dollar in the last quarter. Europe, the US and Japan were offset by Russia, India, Brazil and China. Altagamma, an Italian fashion industry association, said fashion would still see 5% growth in 2008, while jewellers would enjoy a 3% rise. D’Arpizio said a global slowdown was expected in watch and jewellery sales for the last quarter while shoes had been a record category for the luxury sector.

TELECOMS : Nokia launches e-mobiles in emerging markets 

Nokia is launching several new devices and services in the New Year to allow customers in emerging markets to get on the internet primarily through their mobile phones. For as little as €40, the 2320 Classic and 2323 Classic will include web browsers and allow users to set up email accounts from their mobile phones. If successful, the strategy could give Nokia a long-term advantage over other companies as emerging markets join the Information Age. For a nominal subscription, farmers could check things such as the weather or which cash crops are fetching the best prices. Another service will offer English lessons and other educational information. Nokia plans to launch the service in the Indian state of Maharashtra this month, before rolling it out countrywide and elsewhere in Asia and Africa. In a departure for Nokia, the company will become a content provider for these information services. Emerging markets are crucial for the industry, underscored by Sweden’s Ericsson, the market leader in base stations and other wireless infrastructure, setting up a unit in Johannesburg that is developing software.  

INTERNET:  New software to tackle copyright infringements 

The legitimate owners of video pirated online may soon profit from their stolen content, thanks to new software being trialled by MySpace and MTV. Sites that provide user-generated video online constantly struggle to remove content like music videos and TV shows that are uploaded without permission from the copyright holders, in fear of possible legal action. Now, rather than try to remove the offending content, the new system will instead simply overlay copyright-infringing footage with advertising designed to generate revenue for the true owners. The technology to make this possible was developed by California-based company Auditude. The software analyses shows aired by TV channels and looks for matches in footage uploaded by MySpace users. That system is combined with a way  to serve adverts on top of any copyrighted content found. 

MANAGEMENT : Energy profits from banking losses 

City jobs in the energy sector have jumped 35% this year, a rare piece of good news for beleaguered financial services. Research by recruitment consultant GRS estimates that London-based energy trading businesses and trading arms of utilities companies have filled 900 management posts this year, up from 670 a year ago. Bankers are rushing to join utilities, as major banks axe jobs, while energy firms have been eager to recruit: risk management, tax and legal departments have all been hiring. Salaries have jumped 12% and senior energy managers can expect a base wage of £380,000. The average salary of £90,000 for middle rankers in energy trading is still lower than banking but the gap has narrowed: GRS says bankers earn 7% more than those in utilities, down from 18% in 2007. Energy bonuses are expected to leap to an average of 21% of salary. 

AUTOMOTIVE : Crunch puts brakes on carmakers  

BMW has announced a sharp drop in profits and admitted it would miss its targets for 2008 as sales fell by 4.2% and net profit plunged 63% to €298m in the third quarter. It also said it would cut production by an extra 40,000 units this year, following the impact of the slowdown in the US, its largest market. BMW has also warned that its provision for bad debts may be increased again. BMW is not the only car manufacturer hurting, with General Motors, which is in merger discussions with Chrysler, announcing that its October sales had almost halved from a year ago. Porsche, meanwhile, says its US sales plunged by 39% in October year on year. Porsche enlivened the financial pages further when it revealed it held 74% of Volkswagen. While the German state of Lower Saxony held 20%, the limited floating stock caused hedge funds to rush to cover short positions, forcing up the price of available shares, briefly making Volkswagen the world’s largest company by stockmarket value. With the funds facing massive losses, Porsche offered to offload 5% of the shares. 