Merrill Lynch CEO ousted
Merrill Lynch’s board of directors decided to force out CEO E. Stanley O’Neal over the weekend, following a record $8.4 billion write-down and unauthorized merger talks with rival Wachovia. (AP in Yahoo! Finance) According to news reports, O’Neal was negotiating the terms of his departure. (The Wall Street Journal) O’Neal’s five-year tenure as CEO was marked by a move toward riskier invetments and harsher accountability. If O’Neal had completed a merger, he would be leaving Merrill with $274 million, said compensation consultant James Reda. But with $154 million in stock and pension, “he’s going to be very well off,” Reda said. (Los Angeles Times, free registration required)
Fox, NBC launch video Web site
News Corp.’s Fox network and NBC Universal begin public testing of their new online video site, Hulu, today. Hulu, supported by ads, will show free TV shows and movies from NBC, Fox, Sony, and MGM. (AP in Yahoo! Finance) In a shot at YouTube, Hulu will also give viewers tools to legally place video clips or whole episodes on their blog or Web page. Analysts had given Hulu little chance when it was announced in March. “I think there’s a snarky desire to say this is big dumb media and this is a big dumb joint venture,” said News Corp. president Peter Chernin. “If there is a product that’s attractive to consumers, we’ll be just fine.” (The New York Times, free registration required)
Cable competition in apartments on tap
Federal Communications Commission chairman Kevin Martin said his agency is preparing to rescind thousands of contracts that give one cable company exclusive rights to provide service to entire apartment buildings. The new rule, designed to counter rapidly rising cable prices, will also be a big win for Verizon and AT&T, which are trying to muscle into the video content delivery market. Studies show that when a second cable provider enters a market, prices drop by up to 30 percent. “This is the most significant step regulators can take short of regulating prices,” said Greg Kimmelman of the Consumers Union. (The New York Times, free registration required)
Trading pork bellies, quietly
The merger of the Chicago Board of Trade and the Chicago Mercantile Exchange is putting one more nail in the coffin of open-outcry commodity traders. When the CME moves into the Chicago Board of Trade’s building next May, open-outcry trading pits for pork-belly futures and other commodities will be closed in favor of computer trading. The decision sits hard with the open-outcry profession, which dates back to 1848. “We’re trading against machines,” said Jeffrey Levant, 53, who has been at the CME for 29 years, mostly as a pit trader. “Sometimes it feels like we’re John Henry going up against the steam hammer.” (The New York Times, free registration required)