The biggest Australian shopping centre operator, Westfield Group, is focusing on going 'phygital' shopping mall.
Frank Lowy is one of the richest Australian and co-founder of the Westfield Group, the biggest shopping centre operator in Australia, with an assessed net worth of A$7.16 billion in 2014.
According to The Australian Financial Review today, Frank's son, Steven, has formed Westfield Labs in San Francisco as a global digital laboratory focused on going "phygital" – or making malls places where the physical and digital converge – a concept due to be rolled out in part in the retail space at New York's World Trade Center later in 2015.
"But how?" Frank asked. Online retailers still need somewhere to display their wares. Rather than having a scattering of small shops, they will have a few large showrooms. Iconic malls can accommodate these.
These malls are like mini-cities and the idea is to enable consumers to go online and plan their trip. From home they can make a list and search for items among the hundreds of stores and millions of products in the centre. As they do this, they will receive up-to-date information about products and services.
Their plan and shopping list will be on their phone and as soon as they arrive the mall will register their arrival, connect them in various dimensions of personal shopping and reward them if they happen to be frequent shoppers.
If they choose, they can disengage from this digital world and have a traditional mall experience.
Since Frank opened Westfield's first mall in 1959, then, hands-free shopping, valet parking and home deliveries have become par for the course, but the internet is adding a new dimension. It can make the process less clunky, more transparent and will enable the mall to reach into people's homes.
According to The Nikkei Asian Review today, recognizing that malware cannot be stopped entirely, Japanese IT companies are providing ways to limit the harm.
The Japan Pension Service recently became one of a growing number of organizations targeted in cyberattacks - in this case, a virus-laden email attachment. This breach, which resulted in a major loss of personal information, prompted government agencies and corporations alike to seek better defenses.
Information technology companies are answering the call. NTT Communications offers a new service that detects suspicious data transmissions indicating malware may have infected a client's computers. NTT Com's monitoring centers automatically block communications from the computers in question while specialists analyze the problem. If necessary, infected machines are completely isolated.
NTT Com sells software that quarantines email attachments within networks and detects viruses by such telltale signs as unusual communications. Even with this up-to-date protection, new viruses can slip through and cause widespread damage by connecting to external servers. According to NTT Com, its new service blocks data transmissions from infected computers within eight to 20 minutes, providing an added line of defense for customers that already use the detection software.
NEC and Trend Micro joined forces by linking the former's network control technology with the latter's malware detection software. The system looks for suspicious data transmissions. If a client computer is deemed infected, it is automatically cut off from other machines in the same or external networks.
According to The Australian Financial Review today, BHP Billiton is backing away from its $US30 billion foray into US unconventional gas, taking a $US2.8 billion write-down on its US onshore business.
BHP Billiton investors have accused the giant of overpaying for assets at the peak of the cycle after it took a $US2.8 billion write-down on its US onshore shale gas business.
The resources giant on Wednesday also raised doubts about its commitment to swing its US onshore oil and gas division into cash flow positive territory this financial year, saying it required an average crude oil price of $US60 and national benchmark gas price of $3, well above current prices.
The pull-back in unconventional gas is a clear indication that BHP will focus growth on conventional oil and gas, where BHP chief executive Andrew Mackenzie has spent much of his career.
BHP has repeatedly slashed capital spend for the division over the past year, with the oil price collapse rendering many of its wells unprofitable.
BHP's shale gas-focused Hawkville field – acquired as part of the miner's $US15 billion acquisition of Petrohawk Energy – accounts for most of the $US2.8 billion writedown.
The rest of the write-down is to be taken on goodwill over the Petrohawk acquisition, made in 2011 to take BHP deeper into US shale.
According to The Australian Financial Review today, another major miner, Rio Tinto, has cut its full year iron ore shipments target on weather woes in the first half to 340 million tonnes, from its previous guidance of "approaching" 350 million tonnes.
"Heavy inland rains reduced truck utilisation, resulting in lost production at the mines and impacting the ability to rail planned tonnes," Rio said.
Australian major supermarket chains, Coles and Woolworths, cut private label prices to narrow gap with an international supermarket chain, Aldi
According to The Australian Financial Review today, Coles and Woolworths are slashing the price of private label groceries to counter the growing threat from Aldi, while continuing to raise prices on national brands.
Deutsche Bank's latest supermarket inflation survey shows private label grocery prices dropped 6.1 per cent in the June quarter. It was the sharpest falls in more than 18 months, as Woolworths and Coles sought to narrow a 30 per cent price gap with Aldi, which sells mainly private label goods.
Prices for branded groceries rose 1.3 per cent in the June quarter, despite escalating competition between the large supermarket chains and independent retailers, although the rate of growth was less than half that in the March quarter (2.8 per cent).
"If you think about where the overlap is with Aldi, they have to make sure their pricing is reasonably sharp," Deutsche Bank analyst Michael Simotas said.
"The shopper going into Aldi is a shopper who cares mostly about price – what brings them through the door is a focus on value. By sharpening their private label pricing, Coles and Woolworths are hoping to stem that loss of customers," Mr Simotas said.
Woolworths cut prices aggressively in the June quarter to win back lost market share and reinvigorate weak same-store sales growth, with the price of a basket of branded groceries falling 2.6 per cent in the June quarter, Deutsche Bank said.
However, a basket of national brand groceries at Coles rose 5.1 per cent, as the retailer generally ignored Woolworths's Red Spot specials and Cheap Cheap promotion and maintained its everyday low prices strategy.
While lower food prices are good for consumers, food price deflation makes it harder for retailers to cover rising costs unless volume increases offset the impact on margins.
A Japanese multinational electronics corporation aims to have a hydrogen generation system market ready by around 2030 to replace solar batteries.
According to The Nikkei Asian Review, a Japanese multinational electronics corporation, Panasonic, is developing a household fuel cell system using hydrogen that can power homes and vehicles. It is doing so in part to help the government create a "hydrogen society."
"We are committed to developing technology that can play a part in the household hydrogen-based infrastructure," Yoshiyuki Miyabe, Panasonic's senior managing director in charge of technology, said July 3 in Tokyo.
Water is made of hydrogen and oxygen. The conventional electrolysis method for splitting water costs money as it uses electricity. Hydrogen does not produce carbon dioxide when it is burned, making it a clean source of energy. But when hydrogen is produced from water by using electricity, it is not as clean.
To lower costs and become greener, Panasonic centres on photocatalytic water splitting. Sunlight helps to trigger a photocatalytic reaction and split water into hydrogen and oxygen. The company plans to install panels on house rooftops for power generation through the process.
Photocatalytic water splitting has so far worked only under ultraviolet sunlight. Only a slight amount of UV light is contained in the sun's rays. Therefore, the company has developed niobium nitride-containing catalyst films, which can produce hydrogen by reacting to visible light rays. Visible light has the largest amount of energy among the different rays of the sunlight.
Panasonic this fiscal year started a research project to boost hydrogen production efficiency in cooperation with Japan's national New Energy and Industrial Technology Development Organization, known as NEDO, and Kyoto University.
Reserves of niobium are plentiful, and there are lower risks of unstable supply and price fluctuations when compared with silicon. Moreover, the use of niobium helps simplify the hydrogen production method, which is expected to lower production costs as well. "We hope that our technology will be able to generate enough hydrogen to meet all household energy needs with our rooftop panels in the future," said Kazuhito Hato, general manager of Panasonic's hydrogen production and storage technology research department.
Currently, fuel cell batteries are equipped with a device to extract hydrogen from gases. But Panasonic is developing a new type of fuel cell battery that uses hydrogen directly. This will help cut gas costs.
For years, Panasonic has been a leader in renewable energy use and the development of energy-saving technology for households. The company has decided to invest in increasing solar battery production, for instance. Now, it also aims to join the government-led "hydrogen society" initiative.
In the hydrogen energy business, many companies do research and development in the "upstream" sector -- finding ways to mass-produce hydrogen from oil and natural gas or generate large volumes of electricity through hydrogen imports.
Panasonic's focus is on the "downstream" sector, or households. Even though each household is small in size, the customer base is broad in this sector. The company can also expect its hydrogen work to have benefits for its homebuilding and consumer electronics businesses.
Yet, there is a long road ahead. Fuel cell batteries are gradually coming into wide use in Japan, but fuel-cell vehicles have been released only recently. As such, the use of hydrogen energy is still in its infancy. The company faces a number of hurdles, such as how to raise photocatalyst's hydrogen production efficiency and durability as well as how to safely store the produced hydrogen.
"We hope to create a business worth about 1 trillion yen ($8.09 billion) by 2030 in three areas -- water, hydrogen and air," said Panasonic President Kazuhiro Tsuga, who hails from the company's R&D department.
In the past, Panasonic conceived the idea of developing blue light-emitting diode, but the company failed to properly judge the LED's business potential. To not repeat the same mistake, Panasonic needs a lot of patience to turn its hydrogen energy technology into a viable business.
We are very pleased to hear that the biggest Japanese airline poised to return to Australia.
According to The Australian Financial Review today, Japanese airline All Nippon Airways is this week expected to unveil plans to fly between Sydney and Tokyo for the first time in 16 years, in a move that will be welcomed by the local tourism industry but will challenge rivals Qantas Airways and Japan Airlines.
ANA is poised to launch daily flights between Sydney and Tokyo's Haneda Airport using a Boeing 787-9 aircraft from October, according to Australian Business Traveller and other aviation industry sources, although a company spokesman on Friday said he was unable to confirm the speculation at that time.
The re-entry into the Australian market comes as Qantas adds capacity by flying daily A330 services between Brisbane and Tokyo and shifts its Sydney-Tokyo flights to Haneda, which is closer to the Japanese capital's CBD than the more distant Narita International Airport, in August. JAL offers daily services between Sydney and Narita, while low-cost carrier Jetstar flies to Japan from Melbourne, the Gold Coast and Cairns.
ANA is a member of the Star Alliance alongside Air New Zealand, United Airlines and other carriers, whereas Qantas and JAL are both in the oneworld alliance. It remains unclear whether it will seek a codesharing arrangement with Virgin Australia. Virgin services Japan through codeshares with its shareholder and partner Singapore Airlines, but those require a time-consuming stop in Singapore.
The arrival of ANA, which is now Japan's largest airline, will be welcomed by the local tourism industry. The number of Japanese visitors to Australia fell by 0.1 per cent to 323,900 in the 12 months to May relative to the prior year, according to the latest arrivals data from the Australian Bureau of Statistics. That is well down on the 800,000-plus annual Japanese visitors to Australia in the mid-1990s and the low growth rate makes it one of the worst-performing inbound markets.
However, the number of Australians heading to Japan rose by 22 per cent to 267,300 over same period, perhaps driven by factors such as a weak yen and new Jetstar flights between Melbourne and Tokyo.
ANA's 787-9s have 215 seats split between business class, premium economy class and economy class.
Record cattle prices are threatening to push steak off the menu and take the sizzle out of beef sausages in Australia.
According to The Australian Financial Review today, some beef cuts have spiked by as much as 50 per cent in the past six months thanks to strong overseas buying – driven partly by the softening Australian dollar – and drought conditions.
The big price rises are putting the squeeze on margins in the meat processing industry and sparking warnings that shoppers need to get used to paying more for beef.
Butcher Peter Bouchier admitted it was very difficult to pass on the big cost increases to shoppers.
"There's just no cheap beef any more and it's the cheaper cuts that have probably taken the biggest rise, chuck, stewing steak and trimmings, which we use for sausage meat," he said.
Mr Bouchier, who has several Melbourne outlets, warned some expensive cuts of beef could disappear from butchers and restaurant menus altogether.
The major retailers are also grappling with the big price hikes.
A major Australian supermarket chain, Coles, said the price rises in beef were great news for farmers but had forced the supermarket giant to "minimise" the impact for some of these increases.
"[However] for some beef products in our supermarket, . . . we have needed to increase prices to reflect the higher cost, "a spokesman said.
An another supermarket chain in Australia, Aldi, also said rising prices were making it challenging to find cheaper cuts of beef.
"However, what we may see is consumers trying new cuts of meat like chicken or pork," a spokesman said.
CWB The House of Quality Meat supplies product to the restaurant industry and holds major contracts with pubs and clubs.
Tarik Yalcin, who has worked at CWB for 16 years, warned the higher prices for steak and sausages were here to stay.
He said it was hard to see what would bring them down given the ongoing overseas demand for Australian meat.
"Everything gets driven by the export prices," Mr Yalcin said.
The high cost of cattle is also hurting meat processors, which are cutting shifts and reducing production.
According to The Asahi Shimbun, a major Japanese general contractor, Taisei Corp, said it has created a three-story building that supplies all of its energy needs through solar power and significantly cuts down on wasted electricity.
Taisei intends to lower the cost of the construction method and commercialize it by 2020.
According to Taisei officials, the company spent an entire year examining whether the building at its technology center in Yokohama, Japan could operate without receiving outside power.
Taisei applied a thin coating for photovoltaic power generation to half of the surface of the exterior walls and set up solar panels on the roof.
After the one-year study, Taisei found that solar power alone could cover all the electricity used at the building.
In addition, the amount of electricity used inside the facility was lowered by 75 percent through various measures, such as introducing lighting devices that illuminate only around people and installing air-conditioning systems that use circulating water.
The cost to build such a self-sufficient facility is 1.5 to two times higher than the price to construct a similar-sized building powered by outside electricity sources.
But Taisei said consumers will prefer the power-saving building if the construction cost is lowered to 1.2 times the expense for normal buildings.
A major Japanese mobile phone carrier, DoCoMo, and GE are teaming up on infrastructure management in Japan. The aging of infrastructure has become a major issue in Japan.
According to The Nikkei Asian Review today, a major Japanese mobile phone carrier NTT DoCoMo and General Electric of the U.S. will join hands to offer remote-monitoring services for bridges and other structures in Japan.
A lot of the infrastructure that was built during Japan's post-war high-growth period is now aging. The two companies will offer Internet-based services to optimize management of these structures.
GE will install sensors on bridges and roads as well as water, gas, power transmission and other equipment to measure such data as vibration, rotation, flow rates and temperature, transmitting it via DoCoMo’s mobile network. The information will be analyzed to predict equipment trouble, and notifying clients of potential problems in advance could help them save on maintenance costs.
The duo plans to share analysis results with customers via custom software and smartphone and tablet apps. Details such as how to run the business and service pricing have yet to be set. The partners aim to begin marketing next year to power and gas providers, municipalities and others.
GE has abundant experience with "Internet of Things" technologies and considers the harmonization of connected machinery and services as a core business. Its sensors on aircraft engines collect and analyze data via the Internet, helping airlines cut costs. AirAsia, Asia's biggest low-cost airline, reduced fuel costs by US$10 million annually thanks to GE's system.
As rivals like IBM increase their focus on the Internet of Things, GE looks to expand operations in Japan and found DoCoMo, which is eager to cultivate businesses beyond its stagnant mobile services.
Many manufacturers and IT companies from Japan, the U.S. and Europe have adopted Internet of Things technologies at their factories or operations and now are diversifying services to others. Hitachi devised a grain-sized sensor to measure changes in materials, analyzing collected data. Fujitsu will sell sensors to monitor production lines and construction workers starting in December. Toshiba, Mitsubishi Electric and NEC also are building Internet of Things businesses.
A global asset management company, Brookfield, bid for an Australian freight logistics company, Asciano, to spark more deals with global investors
According to The Australian Financial Review today, two of Australia's most powerful infrastructure players say Brookfield's $9 billion tilt for Asciano may unleash a flood of overseas interest in local utility and electricity assets as global investors clamour for reliable earnings in a low-yield economy.
Port of Melbourne Corporation chairman Mark Birrell and NSW Ports chairman Paul McClintock said the Canadian giant's proposed bid for ports and rail operator Asciano could lead to a surge in interest in other assets being put up for sale by state governments.
"I'm very pleased that there is heightened investment interest in the nation's infrastructure assets because we need extra funds attracted to it to help fund new projects," said Mr Birrell, who is also chairman of Infrastructure Australia. "Australia can't simply rely on increased public funds – it has to attract new sources of capital – and overseas funds are increasingly going to drive this interest. They like the long-term returns."
Brookfield, Canada's largest alternative asset manager, lobbed a non-binding cash-and-shares offer last week valuing Asciano at $9.05 a share, a 36 per cent premium to the $6.65 the company's stock closed at on Tuesday. Asciano shares climbed by about 20 per cent in the following three trading days before falling 14¢ or 1.75 per cent to close at $7.86 on Monday.
"In a lower interest rate world, there will increasingly be more and more investors looking at long-duration assets," said Mr McClintock, who is also the chairman of the Committee for the Economic Development of Australia (Ceda). "It's an international space so you will see lots of foreign interest coming through as assets around the country are put up for sale."
A string of major government-owned Australian infrastructure facilities are being primed for sale by the end of this year as state governments seek to raise cash to build new roads and highways.
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