[opendtv] Re: Samsung 100" display

  • From: DISMO@xxxxxxx
  • To: undisclosed-recipients: ;
  • Date: Sun, 19 Dec 2004 01:32:55 EST

In a message dated 12/18/2004 6:16:13 A.M. Pacific Standard Time,  
mcdonald@xxxxxxxxxxxx writes:
Remember  that there are lots more rich people who can
spend on home gadgets than  there are business bean
counters willing to pay for  gadgets.

New Luxury Goods 
Set  Super-Wealthy
Apart From Pack 
Rising  Riches Stir Rivalry
For Ever-Bigger Yachts;
Waiting for a Maybach
An  Echo of Louis XIV's Court
December 14, 2004; Page A1 
FORT LAUDERDALE, Fla. -- Don Weston used to feel special cruising  the world 
in his 100-foot yacht. Yet on a recent morning at the International  Boat Show 
here, the retired Cincinnati businessman stood on his upper deck,  
overshadowed by giants. 
Next door was the Corrie Lynn, a 130-foot cruiser with a  king-sized Jacuzzi, 
five cabins, retractable plasma TV screens and twin jet  skis. Down the dock 
was the 197-foot Alfa Four, with an indoor gym, swimming  pool and helicopter 
pad. The talk of the show was billionaire Paul Allen's new  pleasure boat, 
Octopus, which extends over 400 feet and has a basketball court,  music studio 
and personal submarine. That's about to be topped by a yacht under  
in Dubai for a Saudi client. It's expected to exceed 500 feet, the  size of a 
small cruise ship.         WALL STREET JOURNAL VIDEO

WSJ Reporter Robert Frank discusses the _new  category of luxury goods_ 
wNaO_duLK3fLxJJhI9fNsnmoAm,00.html?mod=ARTICLE_VIDEO) 1  America's 
super-wealthy are buying to set themselves  apart.  

"I used to think I had a good-sized boat," sighs Mr. Weston. "Now  it's like 
a dinghy compared to these others. How big are they going to get?" 
The yacht business reflects a new arms race breaking out among  the wealthy. 
With the population of millionaires soaring to more than two  million in the 
U.S., the rich are finding it harder to set themselves apart.  Many are turning 
to supersized luxury consumer products to rise above the pack.  Today's 
super-wealthy, and the companies that serve them, are creating a whole  new 
category of high-end products that are priced beyond the reach of mere  
Megayachts have grown in size from a typical length of 80 feet to  110 feet 
in the mid-1990s to well over 150 feet today. The market for luxury  yachts has 
more than tripled since 1997, with some boats costing well over $100  
million. Dozens of boats longer than 200 feet are now under construction. 
The most expensive Mercedes used to be the CL600, which cost  about $100,000 
in the late 1990s. Last year, the Mercedes group, part of  DaimlerChrysler AG, 
introduced the Maybach 62, which sells for more than  $350,000. This year, it 
started selling the SLR, which is priced at over  $450,000 and has a long 
waiting list. Not to be outdone, Volkswagen AG's  Bugatti unit is about to 
introduce a sports car priced at more than $1  million. 
Watch makers Patek Philippe, Rolex and Breguet are selling  watches priced at 
more than $200,000, and limited-edition watches can now run in  the millions. 
The inflation rate for luxury goods reached 7% last year, more  than twice 
the overall U.S. inflation rate, according to a study conducted by  Merrill 
Lynch & Co. and the consulting firm Capgemini Group. The real rise  isn't in 
trinkets for the mass affluent such as handbags, clothes and shoes.  It's in 
big-ticket items for the wealthy. 
Vacation-home prices in Aspen, Martha's Vineyard, Northern  California and 
other elite spots have doubled in recent years, real-estate  agents say. Palm 
Beach has become an island of billionaires, with financier Ron  Perelman 
recently selling his oceanfront estate there for more than $70  million. 
Sotheby's and Christie's both topped $90 million in sales at  their postwar 
and contemporary art auctions this month, with only a handful of  works selling 
for less than $1 million. Racehorses are hitting prices not seen  since the 
mid-1980s, with one yearling recently selling at auction for more than  $8 
The luxury boom stems from a huge increase in personal fortunes.  The wealth 
held by millionaires world-wide rose to $28.8 trillion as of the end  of 2003, 
according to a separate Capgemini-Merrill study, up 11% from $26  trillion in 
2001. That's more than the annual gross domestic products of the  U.S., 
Japan, Germany, France and the United Kingdom combined. Those at the very  top 
appear to be doing especially well recently. The wealth controlled by  
in North America with more than $30 million in financial assets --  such as 
stocks and bonds, but not including real estate -- jumped 45% to $3.04  
trillion in 2003 from $2.1 trillion in 2002, according to Capgemini-Merrill. 
A generally rising stock market over the past decade, soaring  executive 
compensation, higher real-estate values and lower taxes on the wealthy  are all 
cited as explanations for the rising wealth. Also, more and more  entrepreneurs 
who started family businesses after World War II are cashing out  because of 
industry consolidation, creating what private bankers like to call  "major 
liquidity events." Today's instant multimillionaires tend to be younger  than 
rich of the past, and more likely to splurge on lifestyle goods to  
differentiate themselves from hoi polloi affluent people.  
Edward N. Wolff, a professor of economics at New York University  who studies 
wealth, likens modern-day big spenders to nobles at the court of  France's 
Louis XIV, who reigned from 1643 to 1715. To ensure the nobles'  loyalty, Louis 
continually raised the "entry price" of being in his court,  requiring them to 
wear increasingly expensive clothes and keep larger and larger  homes. The 
nobles' need for greater wealth made them even more dependent on the  king's 
good graces, and left them less money to spend on arms. 
Today, Mr. Wolff says, it's the wealthy themselves who are  bidding up the 
price of being on top. "For the wealthy to keep their status,  they have to 
compete in terms of luxury consumption," Mr. Wolff says. "The mere  fact that 
group can pay these prices becomes an indicator of social  standing." 
Of all the unnecessary purchases, yachts are among the hardest to  justify. 
Owners of a yacht -- generally defined as a vessel longer than 85 feet  
registered for private use -- rarely use their boats more than a month or two a 
year. Upkeep can cost millions of dollars a year, and yachts typically fall in  
value after three or four years. A new paint job alone can cost more than  
$100,000. What's more, international maritime law generally prohibits yacht  
from carrying more than 12 guests, excluding crew members, although some  big 
boats can get permission for 36 guests. That means a yacht can't host large  
parties while cruising offshore. 
Yachts do give their owners one important value: exclusivity.  Norberto 
Ferretti, chairman of the Ferretti Group, one the world's top yacht  builders, 
his customers like the privacy and freedom that comes with  cruising on a 
yacht. Entertaining guests on a yacht is "much more special than  just bringing 
them to your villa," he says. Best of all, yachts separate the  seriously rich 
from the merely well-off. 
"Rich people can go to a beautiful hotel and pay $3,000 a night  for a 
suite," he says. "The trouble is, when you go down the elevator, you're in  the 
lobby with people who paid twenty times less. My clients don't like  that." 
Yet even yachts are becoming more mass-market. With cheaper,  
composite-material hulls and mass-production techniques seeping into the  
yachting world, 
yacht builders can now crank out larger volumes. There are 257  orders for 
"starter" yachts -- between 80 feet and 100 feet -- scheduled for  2005, up 
from 139 
in 2001, according to ShowBoats International, a magazine for  yacht owners. 
For yacht owners to feel special at the marina, they now have to  have boats 
of at least 200 feet, builders say. As of July 2004 there were 35  boats under 
construction of over 200 feet, including five measuring 295 feet or  more, 
according to the magazine Yachts International. 
Today's biggest yachts are loaded with new technology and toys.  
Computer-controlled stabilizers -- which anticipate the rocking movements of a  
boat and 
offset them with underwater fins or gyroscopes -- make megayachts  perfectly 
still even when anchored. High-tech security systems, stereos,  theaters and 
swimming pools have become standard. Most come with garages, to  house jet 
motorcycles, small motorboats and other vehicles. 
In the U.S., the yacht wars started when Leslie Wexner, chairman  and chief 
executive of Limited Brands Inc., built the 315-foot Limitless in  1997. The 
ship has 3,000 feet of teak wood along with a gym. 
Shortly after, Microsoft Corp. co-founder Paul Allen bought the  354-foot Le 
Grand Bleu, which has its own 72-foot sailboat on board. Then he  commissioned 
Lürssen, the German builder of the world's largest yachts, to  produce the 
414-foot Octopus. It was planned to be the biggest yacht in the  world. 
Delivered last year, Octopus has a 59-foot speedboat, personal submarine,  
pool and music studio, according to builders. The helicopter pad on the  main 
aft deck doubles as a basketball court. People familiar with the boat say  it 
cost more than $250 million to build and will cost more than $10 million a  
to run.    
Octopus, the 414-foot  yacht owned by Microsoft co-founder Paul Allen, is 
equipped with two  helicopter pads, a basketball court, music studio and  

While Octopus was under construction, Larry Ellison, the  hypercompetitive 
Oracle Corp. chief who's also an avid boater, was building his  own superboat. 
It was originally slated to be 393 feet. As the building of  Octopus proceeded, 
Mr. Ellison expanded the size of his boat. The result, a  452-foot colossus 
called Rising Sun, was launched this fall, making Mr. Ellison  king of the heap 
at least temporarily. The price tag was more than $200 million,  people 
familiar with the project say. Neither Mr. Allen nor Mr. Ellison will  comment 
their yachts. 
Now, a Saudi family is building an even larger ship, according to  yacht 
builders and brokers. The boat, called Platinum, is expected to be about  525 
long. It's scheduled for launch next spring. 
Yachts are even outgrowing the yacht builders. Until recently  Azimut-Benetti 
SpA, the world's top yacht builder, could build yachts up to only  230 feet. 
With demand for larger boats so strong, the company last month  announced a 
joint venture with Fincantieri SpA, a cruise-ship builder, to meet  the demand 
for the new breed of megayachts. 
Paolo Vitelli, Azimut-Benetti's chairman, says one of his clients  ordered a 
yacht and saw one of his business competitors with a larger boat. "He  asked 
us to make his one meter larger than his competitor's," Mr. Vitelli  says. 
Demand is so strong that some custom-ship builders are booked  until 2006. 
Since construction takes two or three years, a boat ordered today  might not be 
delivered until 2008 or 2009. Buyers who want a boat right away  must pay a 
steep premium for a finished new boat. 
On a recent morning at the Fort Lauderdale boat show, Don Davis  stepped 
aboard Regency, his new 142-foot, three-deck motor yacht. With a touch  of a 
button, two giant sliding glass doors sprang open to the sprawling living  
The carpet is hand-knotted from wool and silk in China, according to crew  
members. The bathrooms are fitted with Italian marble and the walls paneled 
African Makore wood. 
The grand stairway, sculpted from wrought iron and wood, spans  three 
flights. Retractable plasma television screens adorn almost every room,  along 
surround-sound speakers, audio players and amplifiers. Mr. Davis  designed the 
boat's X-shaped logo, which adorns the dining-room carpet and the  formal 
China. Just filling the gas tank costs more than $12,000. 
Mr. Davis, a Texas businessman whose interests include real  estate and car 
dealerships, is selling Regency to build another yacht, perhaps  even larger. 
His asking price is $18.5 million, and he's already gotten five  offers. 
The size competition may be reaching its limits. The sudden  proliferation of 
big boats has led to a world-wide shortage of berths, or yacht  parking 
spots. Boats over 300 feet are too big for most marinas and have to  anchor far 
from shore or at cruise-ship terminals. Many of the supersized boats  have been 
dogged by cost overruns and quality troubles, builders say. 
"One owner came to me just after buying a huge boat and wanted to  sell it," 
says Henk de Vries, managing director of Feadship, a Dutch yacht  builder. "He 
said that when he stood on the deck, he felt too far from the  water." 
Write to Robert Frank at _robert.frank@xxxxxxxx (mailto:robert.frank@xxxxxxx) 
2     URL for this article:
Strong Sales Seen for Luxury  Goods 
December 15, 2004 
PARIS -- European luxury-goods companies could have a merry  Christmas 
shopping season, spreading a little cheer to the scrooge-like retail  
Going into the critical Christmas season, luxury-goods products  are 
continuing to trump lower-end retail, as they have throughout the year. With  a 
of new products, many at entry-level prices, goods like handbags,  perfume and 
jewelry will sell well world-wide, analysts say, and even the weak  dollar 
and a patchy tourism recovery won't spoil the season. 
Luxury is a "winning sector" this year, Bain & Co. analyst  Darrell Rigby in 
New York says in his holiday spending report -- one of the few  bright spots 
in a Christmas period that will likely be "more 'ho-hum' than  'ho-ho-ho'." 
Bottega Veneta, one of the brands in Paris-based  Pinault-Printemps-Redoute 
SA's Gucci Group division, is one of many  luxury-goods brands forecasting 
robust sales momentum will continue. "The  holiday season shopping has shown 
strong Bottega Veneta retail sales world-wide,  and is expected to remain so 
through Christmas," said Patrizio di Marco, chief  executive of Bottega Veneta. 
Cie. Financiere Richemont SA, Geneva, the watch and jewelry group  that is 
home to Cartier, last month predicted a strong pre-Christmas season.  Analysts 
say most luxury-goods participants share that optimism -- in contrast  with 
retail giants like Wal-Mart Stores Inc., Bentonville, Arkansas,  which is 
offering early promotions and heavy discounting in an effort to lure in  
"Luxury goods are clearly outperforming the lower-end offering in  the U.S.," 
says J.P. Morgan analyst Melanie Flouquet in London. 
The pre-Christmas shopping period, running from around the U.S.  Thanksgiving 
Day holiday in late November to Christmas Eve, is the most critical  season 
for retail in general, including luxury goods. While the U.S. remains the  home 
of the commercial Christmas, analysts say year-end gift-giving is now  
customary world-wide. Jewelry and watchmakers take in 20% to 30% of their 
revenue in pre-Christmas sales, says Claudia D'Arpizio, a luxury-goods  
consultant at Bain in Rome. 
Richemont's Cartier is one of the luxury brands that should have  the best 
Christmas, analysts say. Cartier has timed many of its new product  launches in 
the months running up to Christmas, such as its Santos 100 watch,  which 
arrived in stores in recent months and retails for £3,400, or about �4,900  
($6,512). In addition, it is introducing more lower-price items, from leather  
and lighters to its Trinity jewelry line, which at around £585 for a gold  
necklace is more accessible than Cartier diamond jewelry. 
High demand for leather goods and accessories, other staples  under the 
Christmas tree, should add holiday shine to luxury groups. Bags and  small 
accessories have among the highest margins in luxury, and a boost  in sales 
will result in a stronger operating margin. 
For PPR's Gucci, the hottest products this Christmas are iconic  items such 
as the accessories collection using the Flora pattern from its  archive. The 
Florentine luxury label says its iconic products have registered a  strong 
Analysts also have looked to a strong outlook from Coach Inc.,  New York, the 
popular handbag maker, as an indication that the entire accessory  sector 
will perform well. 
Watchmakers may have the best idea of Christmas performance  because of their 
reliance on wholesale. Analysts say one reason for Richemont's  optimism is 
their wholesale orders, which reveal demand weeks before  Christmas. 
Analysts even see a positive side to the weak dollar. While the  sliding 
dollar will undoubtedly shave some of the profit off European luxury  goods 
sales are translated back into euros, the weak dollar is becoming a  travel 
incentive for Europeans. 
Americans are staying away from Europe as the euro becomes more  expensive, 
stunting a travel recovery. However, new tourism crowds are replacing  them 
with an appetite for luxury goods. Yet some companies will get coal in  their 
stockings. Analysts say Hermes International SA will miss out on  the luxury 
sector's merry Christmas because of delays in getting its  ready-to-wear 
collection into stores. 
Write to Christina Passariello at _christina.passariello@xxxxxxxxxxxxx 
(mailto:christina.passariello@xxxxxxxxxxxx) 1 
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