Airlines: Carriers grapple with United fallout
Major airlines are scrambling to make their policies more customer friendly after United dragged a passenger off one of its flights this month, said Luz Lazo in The Washington Post. Delta said it will offer to pay passengers up to $9,950 to give up their seat on an overbooked flight, up from $1,350. American now “promises that no passenger who has boarded a plane will be removed to give the seat to someone else,” and United said its crews will be required to check in an hour before a flight leaves to avoid bumping customers who have already boarded. Other airlines, like Southwest and JetBlue, said they were also reviewing their policies.
United used an earnings call this week to reassure investors that the company “will continue to thrive” despite its PR disaster, said Hugo Martin in the Los Angeles Times. While the airline reported better-thanexpected earnings, executives said it’s “too early to tell” whether the incident will hurt bookings. The airline is also bracing for what’s expected to be a multimillion-dollar lawsuit from passenger David Dao, who suffered a concussion and a broken nose and lost two front teeth, according to his lawyers. United CEO Oscar Munoz said there are no plans to fire any employees, calling Dao’s treatment a “system failure.”
Economy: Stronger global growth, but clouds loom
The International Monetary Fund is cautiously optimistic about the global economy, said Ana Swanson in The Washington Post. The organization slightly raised its projections for global economic growth this year from 3.4 percent to 3.5 percent in its semiannual World Economic Outlook report, released this week. That’s up from just 3.1 percent growth in 2016. But while growth is gradually improving, the IMF warned that the global economy “remains under threat from rising protectionism and the risk of trade wars.”
Retail: Walmart buying up trendy retailers
Walmart is courting Millennial shoppers with a spree of online fashion buys, said Nandita Bose and Gayathree Ganesan in Reuters.com. The retail giant is currently in advanced talks to buy Bonobos, a trendy men’s apparel brand. If the deal goes through, it would be Walmart’s fourth acquisition of an online fashion brand since the beginning of the year, following purchases of ShoeBuy, Moosejaw, and ModCloth. Walmart is the world’s largest clothing retailer, with sales exceeding $23 billion. But the company “has been unable to replicate that success online.”
Tech: Facebook launches virtual reality app
Facebook is integrating virtual reality into its social network, said Michael Liedtke and Barbara Ortutay in the Associated Press. The company unveiled the first major app for its VR headset Oculus Rift at an annual developer conference this week. The app lets users “hang out with avatar versions of their friends in a virtual world.” CEO Mark Zuckerberg has hinted at such a development since 2014, when Facebook acquired Oculus Rift for $2 billion, but virtual hangouts aren’t expected to go mainstream just yet. Oculus Rift “sells for about $500 and requires an expensive computer to make it work.”
Telecom: T-Mobile spends big on airwave rights
“Wireless carrier T-Mobile, satellite TV service Dish Network, and cable giant Comcast were among the big winners in the latest federal airwave rights auction,” said Aaron Pressman in Fortune.com. T-Mobile won the most licenses in last week’s auction, spending $8 billion for spectrum in more than 400 markets. The new airwave rights will help carriers ease congestion on their networks, which are “increasingly overwhelmed” by streaming videos and social networks. But winning bidders will have to wait as long as three years to use their new rights, because airwaves are currently owned by TV stations and will need to be converted.