From the video game industry's never-ending slide to Mickey Mouse raising the bar on digital distribution, here's a rundown of this week's smartest moves and biggest blunders in the business world.
Video Games -- Blunder
Once again, gamers are going silent.
Industry tracker NPD Group reported on Thursday night that video game software sales slipped 26 percent in December. Hardware sales stumbled a surprising 22 percent -- and that was with the $300 Wii U stirring up excitement.
This caps off the third consecutive dismal year for the industry. Diehard gamers continue to show up for marquee releases, but mainstream players have moved on to other cheaper and more casual diversions.
You would think that the industry would take the hint, but there's still at least one company that missed the memo: Microsoft (MSFT
) -- through its official @MSFTNews Twitter feed -- issued a tweet, bragging that its Xbox 360 has been the best-selling console in this country for 24 consecutive months. Yes, that's true, but it's a shrinking pie Microsoft.
were announced on Thursday, and Walt Disney's Wreck-It Ralph appears to have the inside track to winning for best animated feature when the Academy Awards are presented next month.
However, Disney's also turning heads with this title by revealing that it will be released digitally first -- followed by DVD and Blu-ray. It will be available digitally worldwide on Feb. 12, followed by availability on optical disc three weeks later.
It's a first for Disney, which has a surprisingly potent history of being a trailblazer in digital distribution. It was the first major studio to back the then fledgling iTunes video store.
This is smart because the nature of the movie itself -- characters in a video game that become self-aware and want more out of life -- will appeal to the gamers that have grown to rely media digitally instead of on discs. Is piracy going to be a bigger problem? That may be the case, but if it was going to happen it was going to happen anyway.
The Wall Street Journal reported this week that Apple is working on a cheaper iPhone 5. We're not talking about the iPhone 4 and iPhone 4S that Apple presently sells at a discount. We're talking about a substantially cheaper device, possible one with a polycarbonate plastic shell instead of the iPhone's iconic aluminum casing.
The move isn't necessarily intended to hit the stateside market, where carriers subsidize the iPhone. The problem is overseas through Europe and Asia where buyers have to pay at least $700 for unsubsidized iPhones.
What's the problem with Apple trying to take on the Android revolution? Well, for starters, it's going to have to dramatically sacrifice its margins if it wants to compete outside of the United States. There's also the reputational hit that Apple will get if it becomes associated with lower-quality phones or smartphones with limited features.
There are plenty of analysts that love this move, especially since Apple's market share in smartphones and tables has been shrinking in recent quarters.
You know that the auto industry has bounced back when Ford -- despite the cyclical nature of its business and billions in pension obligations -- is boosting its dividend.
This isn't just a token increase. Ford is doubling its quarterly payouts to $0.10 a share. The move pushes its yield to nearly 3 percent.
With auto sales at a mutli-year high and the near-term prospects strong given the long average age of cars currently on the road, don't be surprised if more car manufacturers put the pedal to the metal on dividend hikes.
The battle between online retailers and physical store chains intensified this week when Target revealed that it will offer price matching to Amazon.com (AMZN
) and other rivals all year long.
It's a game that's impossible to win. There is no way that a brick-and-mortar chain can compete with the low overhead of pure Web-based retailers to deliver rock-bottom pricing.
Target will be better off than most chains following its lead. It has cultivated relationships with celebrities and designers for apparel and home decor items that are exclusive to Target. There are also fresh groceries
that Amazon doesn't sell outside of its AmazonFresh service in Seattle.
However, Target's setting an unwelcome precedent by encouraging shoppers to use their smartphones to compare prices. Target may make the sale, but educated consumers will crush margins.
Motley Fool contributor Rick Aristotle Munarriz owns shares of Walt Disney and Ford. The Motley Fool recommends Amazon.com, Apple, Ford, and Walt Disney. The Motley Fool owns shares of Amazon.com, Apple, Ford, Microsoft, and Walt Disney