Tonight:
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Oil surcharge looks tricky for BA as price dips
Evening Standard 11 Aug 2008
Without wishing to intrude on the current grief at British Airways over fuel surcharges - four of its current and former executives have just been charged with price-fixing - Willie Walsh, who of course knew nothing of the cartel BA was running with Virgin Atlantic, has some explaining to do.
Two months ago, the chief executive raised the fuel surcharges on flights to as much as £218 on longhaul flights, citing the soaring oil price which had just broken through $130 a barrel on its way to an all-time record of $147. The price of oil is now in the middle of something of a crash and trading well below $120 a barrel.
Any sign of a cut in fuel surcharges? Or are they a thin veil for BA extracting more cash from its customers?
* Spotted in the window of a branch of Sports World in Stoke Newington: "24-hour delivery service available." Two things: no one needs a new pair of trainers at 3am. And it rather defeats the point of buying sports clothes if you are too lazy to go and collect them. Still, full marks for optimism.
£250k chauffeur knows a lot...
Which City chief executive pays his driver £250,000 a year to buy the said employee's loyalty - and prevent him spilling his sex-life secrets to the tabloids? Word is, the accounts department started asking awkward questions about the driver's salary and delved deep enough to be told the reason and warned to back off. Maybe the driver isn't overpaid after all. He starts early and finishes late, waiting for the chief executive to emerge from whichever rentboy haunt he is favouring that week...
* Since when did the property industry do taste? The fit-out group Modus is very keen to promote employee harmony and to that end has a social club for staff called Social Happenings and Group Modus events. Does city Spy need to spell it out?
Speed dating the Mayoral team
Move over, speed dating. Canary Wharf Plc is sponsoring the following event at the annual Tory Conference in Birmingham: "The Conservative Party in the London Assembly invites you to 'Speed Meet' the most influential people in London politics from London Assembly members to Deputy Mayors and key political journalists. You have a few minutes to ask them anything you like. Lunch included." Yummy.
* Meanwhile, there is more financial agony for Labour. One way business can lobby and financially support the Party without it being officially classed as a donation is to take a stall at the annual conference - taking place this year in Manchester from 20-24 September. As charges range from £3600 to £12,750 depending on the size and prominence of the stall, the revenue can be considerable. Er, that is in good years. "There isn't exactly a clamour for space," City Spy is told.
Cheap TV that comes at a price
ITV has little reason to cheer at the moment, after seeing profits dive 28% - with worse to come, as advertising is forecast to slump 20% in September. But why are all the big broadcasters struggling? The internet, multichannel audience fragmentation and the economic downturn are just some of the reasons. But city analysts say something else is going on - the obsession with reality TV competitions, which are cheap to make, comes at a price. These shows - whether it's X-Factor, Big Brother or The Apprentice - have little repeat value. The point about reshowing a programme is that it does not cost much to broadcast it many times over and theoretically it brings in extra revenue. But who wants to watch a reality programme again when you already know the result? These shows do get big ratings when they are first broadcast but as archive - "the long tail", in media parlance - they aren't a patch on top-quality drama or comedy.
* Incidentally, what will Channel 4 do now with all its old series of property shows such as Location, Location, Location and Property Ladder? They have often been re-run on C4's digital channels such as E4 and More4. But not many people will want to watch a programme which tells you the value of your home is going up inexorably - when prices are crashing and it seems virtually no-one can get a mortgage...
Like waiting for Godot - it's the British Gas way
The spin from British Gas owner Centrica is that it must put its prices up 35% to cover the higher wholesale cost of fuel and upgrading its infrastructure. No-one likes it much (except the shareholders) but then all the energy firms are doing it. Still British Gas's way of treating customers leaves much to be desired. One City Spy reader gets in contact to say they wanted to get his gas meter moved a short distance - less than a yard inside his home. "Fine," says British Gas, the supplier. "We can do it for free." Seems simple enough.
A contractor from Siemens is sent to carry out the work. Alas, the Siemens man arrives, takes one look at the meter, and says: "Sorry, sir, I am not authorised to do that - and anyway I don't have that pipe in the van." Cue an irate phone call from the customer to British Gas.
Does it solve the problem? No. British Gas sends another man from Siemens, who looks at the meter and - surprise, surprise - says he is not authorised to do the job either.
By now the customer is tearing his hair out as the meter still has not been moved. The latest City Spy has heard is that the customer has had enough of this Waiting for Godot scenario - and is going to get a private gas engineer.
* A contrite Barclays boss John Varley says "the moment of greatest danger is in the past". Let's hope so. But time and again over the last 12 months of the credit crunch, various bankers have been coming up with the same optimistic line. They were saying it last November, after Citigroup and Merrill parted ways with their bosses. It was being said again after Northern Rock was nationalised in February. And then after Bear Stearns collapsed and was saved by JPMorgan. And then with Freddie and Fannie. And so on and so on. Even previously safe havens such as Lloyds TSB are having to admit things have gone awry. And given the way the economy is going, how many people are betting the worst is behind us?
