1 China aviation boom and the first aircraft lessor
IPO in Asia (Straits Times) As China's aviation market booms, local aircraft
leasing companies are raising funds in finance hubs like Hong Kong and
Singapore in a bet they can win market share from the international players
that dominate the industry.
With the country's growing middle class fueling a
surge in travel, Boeing Co estimates Chinese airlines will need nearly 6,000
new jets over the next 20 years, valued at US$780 billion. Many of those
aircraft will be leased rather than bought as carriers seek to cap long-term
commitments: China's 800-plane leasing market is set to grow 50 percent by
2018, according to consultancy Ascend.
Friday's market debut in Hong Kong of Asia's first
listed plane lessor, China Aircraft Leasing Group Holdings, is the clearest
example so far of local players chasing expansion. CALG said the nearly $100
million it raised in its initial public offering will be mostly spent on
acquiring aircraft to try to expand its 3 percent share of the market.
2 Music industry bets on streaming (Linda Yueh on
BBC) The recorded music industry has been in serial decline for decades as it
battles to collect royalties on its offerings. This has accelerated in the
digital era. When Steve Jobs persuaded record bosses to license downloads from
iTunes at 99 cents, music buyers no longer had to purchase a $10 album to get
the songs they wanted.
The industry hopes that streaming can reverse the
trend. A paid-for subscription typically costs in excess of $100 per year,
comfortably more than the $30 per year that defines a good music consumer. Streaming
has also helped to tackle the perennial issue of piracy. But, on the other
hand, the ad-supported services have reinforced the notion that people don't
have to pay for music.
On a subscription service, a music track needs to be
streamed between 25 and 50 times for the rights holder to make the same revenue
as a single download. However, on a free ad-supported service, several hundred
streams are typically required. New artists, who do not achieve millions of
streams, are likely to receive meagre payments for their work.
Apple now appears to be embracing a streaming
future, but before his death three years ago Steve Jobs hated the idea of music
subscriptions. He believed people wanted to own their music rather than simply
rent it. We are about to find out whether he was right.
3 Amazon readying to test drones (San Francisco
Chronicle) Amazon is seeking Federal Aviation Administration permission to use
drones as part of its plan to deliver packages to customers in 30 minutes. The
online retailer created a media frenzy in December when it outlined a plan to
deliver packages with self-guided aircrafts that seemed straight out of science
fiction.
In a letter to the FAA this week, Amazon said it is
developing aerial vehicles as part of Amazon Prime Air. The aircraft can travel
over 50 mph and carry 5-pound loads. About 86 percent of Amazon's deliveries
are 5 pounds or less.
The FAA allows hobbyists and model aircraft makers
to fly drones, but commercial use is mostly banned. Amazon is asking for an
exemption so it can test its drones in the US. The Seattle company says its
drone testing will only take place over Amazon's private property, away from
airports or areas with aviation activity -and not in densely populated areas or
near military bases.
Last year, Congress directed the FAA to grant drones
access to US skies by September 2015. But the agency has missed key deadlines
and said the process would take longer.
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