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About the Author

Teri Bernstein, MBA, CPA has been teaching full time in the Business Department of Santa Monica College since 1985.  Prior to that, she worked in Internal Audit and Special Financial Projects for the 1984 Los Angeles Olympics, CBS, Inc., and Coopers & Lybrand (which is now part of PricewaterhouseCoopers).  She attended the University of Michigan and Wayne State University.

  • Nothing is safe: Heartbleed coding flaw breaks encrypted financial transactions

    image from How much of a problem is the Heartbleed coding mistake that endangered every encrypted financial transaction? According to Bruce Schneier, a cryptographer and security consultant: " I've been saying that on a scale of one to 10, this is an 11 ." There are public policy issues that are arising with respect to Heartbleed ( i.e .the NSA and other security organizations have known about the vulnerability, and have most likely taken advantage of it--without informing citizens and consumers). But, like many business problems--fixing the blame and finding those who abetted the crime does not help the "victims"--which are the millions of us who have been using online banking and retailing sites over the last few years. What do we do about this? The basic advice is: Don't change your password until you are sure the site has fixed its vulnerability problem; and DO change your password for every single institution with which you transact online business. Although it may seem daunting to make a list of all of the sites with which you have done business, and systematically go through them one by one to change the password--that hassle pales in comparison to dealing with identity theft once it has occurred. Make sure you don't forget to change your passwords on Google, Facebook and Yahoo--who have already admitted that they were affected by Heartbleed. They have already fixed the flaw on their side. Some institutions have said that the flaw did not affect them, but others have claimed the issue was "industry-wide" with respect to banking institutions. But if you have used the same password on more than one site--if your password was used on a vulnerable site, it is out there and can be tapped to invade your identity on sites that said they were safe. Sources: " Flaw Calls for Altering Passwords, Experts Say ," by Molly Wood, the New York Times , April 9, 2014. F ollow up: Have you changed your password for Google, Facebook, and/or Yahoo yet? If not, why not? Have any institutions informed you that their site was vulnerable? Have they encouraged (or required) you to change your password? What was the procedure like? How long did it take? Share your experience with others and encourage them to protect their identities as well.
  • "Silicon Valley": business start-up comedy comes to HBO...and YouTube

    [View: utility/ :550:0] from HBO via YouTube HBO's new comedy "Silicon Valley" premiered this past weekend. The show portrays young programmers--one of whom has developed a program he calls "Pied Piper." He designed this program to alert aspiring song writers to any copyright infringement problems, by searching all music libraries everywhere for the note sequences entered. Others realize that the main feature of this program is its ability to instantaneously search through compressed files and deliver sound quality that isn't distorted...and that there are limitless business applications of this rapid and high-quality search algorithm. In addition to the comic interactions portrayed in the series, there are business partnerships, business decisions to make, business entities to consider, and business values to ponder. By the end of the first episode, we learn the importance of a good business plan. The show is its own "Introduction to Business." Interestingly, HBO has decided to let the first episode air on YouTube, so everyone can take a look. Sources: " Watch the first episode of HBO's 'Silicon Valley' on YouTube ," by Chris Velasco, , April 7, 2014. F ollow up: What are the pros and cons of HBO's decision to let the first episode air on YouTube? What entities stand to benefit? Can you identify with any of the characters? What business advice would you give the main character?
  • Oculus: what I don't understand might make a fortune for others

    This image of "The Rift" by Oculus was taken by Christina Ascani for Mashable (linked below) When I read the news that Facebook had purchased Oculus VR , a "virtual reality" start-up, my first thought was, "Huh? What does this have to do with Facebook?" The Oculus "Rift" device lets a user experience a video game as though they were inside it. Moving your head can result in dodging a virtual bullet, and turning your head gives a different view of your video game environment, as though you were really inside that environment. This device is still what I like to refer to as " vaporware "--it doesn't exist yet. Oculus developers were trying to raise enough money through Kickstarter to continue development (they'd already raised $2.4 million). Then Facebook came along...and for $2 billion bought the whole operation. While this solved the Oculus developer's cash problem, it didn't make some of the Kickstarter supporters very happy. David Prosser writes about those concerns in an online Forbes article . [View: :550:0] from vimeo Still--what is in this for Facebook? Do they just want a piece of the video game action? Or do they foresee the Rift device as a way that Facebook friends can also interact? We'll see... Source: " What is Oculus Rift--And Why You Should Care ," by Samantha Murphy Reilly, Mashable online , March 26, 2014. Follow up: What is "virtual reality" and what makes it different from other media experiences? How do the potential users of Rift use Facebook now? Who might eventually be the users? What potential might this product have as an educational tool? Read the Forbes article written by David Prosser. What might be the issues for the original Kickstarter supporters, and what bigger concerns might that mean for Kickstarter?
  • Too late for Obamacare?

    image from website Many individuals who have not been lucky enough to have parent-sponsored or employer-sponsored health care--as well as uninsured individuals--procrastinated when it came to signing up for insurance under the Affordable Care Act (Obamacare). Some of the hesitation was due to the technology failures, but some of it was due to a mis-perception about where one might land in the pie-chart below. The big fear, of course, is that one would be unable to get a good deal on new insurance, and would fall into the 3% "potential losers" category. In any event, the "deadline" for enrollment was March 31, 2014. But there might be ways for those who did not manage to obtain coverage to still be enrolled, according to an Associated Press article. image from Here are some possibilities to obtain a second chance to sign up, or avoid a fine for being uninsured: TAKE ADVANTAGE OF THE GRACE PERIOD : If you started to enroll by March 31, but couldn't finish, have until April 15th to complete an online application or until April 7th to turn in a paper application. USE A SPECIAL ENROLLMENT PERIOD : Special 60-day enrollment periods are being considered by the federal call center (800) 318-2596 and by the state marketplaces. Some of the special extension are being granted for emergency hardships, for example: bad weather, domestic abuse, illness, errors by advisors and insurance companies. These special enrollment periods also open up throughout the year for life events (job changes, marriage, divorce, parenthood). SIGN UP FOR MEDICAID : There is no deadline for those eligible for Medicaid to sign up--and now Medicaid is open to adults making less than $16,100 per year, as well as families with children. BUY INSURANCE OUTSIDE THE GOVERNMENT MARKETPLACES : Even if you can't get the government subsidies this year, you can still buy insurance privately. Obamacare means you can't be refused for pre-existing conditions, so it will be more "worth it" than it was before. PLAN AHEAD FOR THE NEXT ENROLLMENT PERIOD : It starts November 15, 2014 and it runs for 3 months. Do your research early! Sources: " Putting Rate Shock Into Perspective ," by Joan McCarter, The Daily Kos , October 31, 2013. " It's STILL not too late to sign up for Obamacare ," by The Associated Press via , April 1, 2014. Follow up: What is one of the hurdles that people wanting to take advance of the grace period or special enrollment periods have to jump through? Will proof be required, or is it on the "honor system"? Explain the pros and cons of this. In an ideal world, how would health insurance be handled? Do some research and provide support for your answer.
  • The "Income Upshot" tool--what does it say about Homer Simpson and one of the Two Broke Girls?

    the income upshot tool link This article specifically addresses two fictional incomes--that of Homer Simpson and that of one of the "two broke girls" living in Brooklyn. It is fascinating to adopt several different personas to see what "big data" might say about some basic demographic data. I input my personal data and found myself to be riding with the majority on all parameters that were reported. Am I deceiving myself to think that I would NOT have been with the majority on other parameters? Source: " Income Upshot: Homer Simpson Edition ," by Jolie Myers, Marketplace-- American Public Media , September 12, 2013. Follow up: Did you use the link to fill in your income? Is the assessment of this tool relevant to your personal situation? What do you think this link is trying to sell or monetize? What information can "big data" analyzers provide? What are the most relevant parameters, in your opinion, to marketers of various products? What other parameters might be important to marketers? Do you think the selected parameters were relevant and appropriate?
  • Picture this (in one photo): your own small business

    Perma-Link to slideshow at Capturing the soul of a small business in one photo The Small Business blog arm of the New York Times , "You're The Boss," asked readers a while back to submit photos of their small businesses. These photos were to capture something meaningful and over-reaching about the essence of their business, or the rewards or heart-aches involved in building the business. The short slideshow linked on this page illustrates five central images from five different businesses: Pumbaa, a "very lucky pig" from the WhyNotFarm business in Snow Creek, North Carolina Digging out from a snowstorm at Perrault Spring and Equipment (fifth generation family business in Connecticut) Dozens of boxes in a warehouse waiting to be shipped during the high season at Lowrider Sunglasses in Exeter, CA Dedicated--and multi-tasking--service people at DC Home Buzz, a real estate brokerage A blank wall at an online art gallery in San Francisco. Maybe these photos can inspire you to take a photo with a similar "core" feeling about whatever it is that is of primary importance in your life right now. Maybe it is a business or a new job. Or your accounting class.... Source: " Capturing the Soul of A Business in a Single Photograph " by You're The Boss Editors, New York Times, March 13, 2013. Follow up: Really: What does capture most of your attention right now? Can you boil it down to its essence--a single photograph? Pick five to ten photos and mull them over for a few days, then post (in whatever medium you see fit) the photo that really captures the essence your "life's work" at this point in time. Which of the images in the slideshow speaks to you the most--both in terms of communicating the essence of a business, or inspiring you to want to know more about (or have dealings with) that business)?
  • T-Mobile spurs competition among wireless providers

    [View: /utility/ :550:0] Video from T-Mobile offered to pay the costs of contract termination for those willing to switch from one of the big carriers. AT&T countered by offering to pay $200 of the costs--but only of T-Mobile users switching to AT&T. This comes on the heels of T-Mobile reporting higher 4th quarter 2013 earnings--a result of an increase of 1,645,000 customers. T-Mobile seems to have zeroed in on the costs of switching providers as being a major factor in customers being unwilling to change. It has taken a marketing risk in covering the costs of this switch...and it could be that the gamble is paying off. Source Strategy Analytics , however, feels that even though T-Mobile is a catalyst for price competition, that they will not prevail moving forward against the bigger providers--primarily AT&T and Verizon. The market reaction to T- Mobile's moves has shown that a larger number of companies in the pool can stimulate competition and improve the situation for custormers. Sources: " Comparison: How Does T-Mobile’s New Plans Stack Up Against the Competition? " by Alexander Maxham, Android Headlines , March 27, 2013. " T-Mobile to Pay Termination Fees; Reports Customer Growth ," by Reuters, , January 8, 2014. " LTE Enables US Wireless Price War as Carriers Fight for 60 million New LTE Subs in 2014 ," by Source Strategy Analytics, 12 NewsNow, February 25, 2014. Follow up: What does "LTE" mean? What are the alternatives, and why does LTE look to be a medium for the future? What is the projected growth according to Source Strategy Analytics? What are the key factors that keep you from switching wireless carriers, even if there is a price advantage? Consider: your level of understanding about the plans, the information sources you trust, the time factor, start-up or termination costs, and any other factors. What is the industry term for customer defectors? (read all of the linked is in there somewhere)
  • The Lego Empire

    image from Forbes magazine This movie has something for everyone--parents, kids, casual moviegoers, erudite film critics, and Warner Brothers investors. It only cost $60 million to make, and its domestic box office for the first three weeks topped $183 million . My husband and I saw it in 3D on a Saturday afternoon and we didn't know what to expect. But a few minutes in, it was pretty clear that the script was dense with puns and double-entendres. The story itself contained themes about job autonomy and the responsibilities and choices corporations make to improve or harm the world of its employees and customers. Plus, it was a sweet story about overcoming the obstacles of low self expectations...and of inflated self-perceptions. The song " Everything Is Awesome " has staying power as well. [View: utility/ :550:0] The movie is a metaphor for the success of both the Lego Company and Time Warner. According to Scott Mendelson in Forbes , " all likelihood, The Lego Movie will be a big hit that will not only sell countless new Lego sets, but also be the first building block towards reestablishing Warner Bros. as an animation powerhouse." Opportunistic investors have probably missed their best window to buy, but it remains to be seen whether either company can build on this success. Source: " Lego Builds an Empire, Brick by Brick ," by Gregory Schmidt, New York Times, February 15, 2014. " Review: Everything About The Lego Movie Is Awesome ," by Scott Mendelson, Forbes , February 4, 2014. Follow up: Are you familiar with the Lego brand name? Have you owned Lego block kits? Visited LegoLand? Played the Lego video game? What are the first words that come to your mind with respect to this product? What does Gregory Schmidt think about Lego's business plan?
  • Rakuten? Viber? Maybe we need to be paying attention

    image from We know what Skype and Facebook can do...but Rakuten ? Viber ? As it turns out, Rakuten--formerly known as a huge Japanese eRetailing company. It just spent $900 million to buy Viber--a messaging app company. A free texting and voice calling company, really. Viber and other similar service companies-- WeChat for example--may not be a household name here in the U.S., but the services those communication services companies provide are a big deal in China. They could become a big deal here, too. It only takes a little time to get hooked on the rich menu of services that one of these messaging apps provides. I have an iPhone, and I really enjoy sending my older daughter visual "stories" using the icon menus built into the iPhone. airplane...the statue of Liberty...a taxi. What a nice way to tell my daughter I am excited about visiting her in New York City! But my husband and my other daughter have an Android and a Windows phone. My icons look like swear-word symbols when they show up in texts to them...which is not my intention at all. But we all could download Viber and use its features across phone platforms. This could be fun. Plus the voice calls, according to the reviews, are super-clear; no distortion or feedback. According the the Marketplace piece, a messaging app like Viber could replace "your voice plan, your texting plan, and half of Facebook." And Rakuten--a retailer that's bigger than Amazon--just bought it. It could be big. Source: " Messaging apps: Skype has competition. Facebook too. ," by Dan Weissman, Marketplace, American Public Media, February 14, 2014. Follow up: Download Viber or WeChat and have 4 or 5 of your main contacts do the same. Play with the app for a week or so...then comment on what your experience was like.
  • How 1040 tax-return filing could be a "game" gone viral

    image drawn by Glynis Sweeny, and published with the article linked below An ad campaign from Jackson Hewitt , a tax preparing firm, claims, “Taxes are Fun!” The Jackson Hewitt folks might be onto something if they combine forces with the folks like Gabe Zicherman , who understand how to "gamify" processes. Some aspects of gamification include: Introducing competition into the process so there is a way to "win." Rewarding folks for participating when times are slack, but charging more ("surge pricing"), when times are slow. Creating marketing events to encourage participation. Zicherman doesn't think the I.R.S. is currently a good "game" at all. " If you file your taxes on time, every single year you don’t get anything from that.” he said. Some of Zicherman's suggestions include: Lower taxes for those who file and pay close to January 1. Create luxury services and conveniences to help people file (don't call them higher taxes!)...and charge them more for them. Let market forces set the higher rates. Add interim deadlines to build "adrenaline-pumping addictiveness." Create surge pricing for returns filed on the deadline of April 15, to pay for the work crunches experienced by the post office and the IRS employees. Big random prizes--1 in 10,000 gets a big discount or even let winners pay no taxes. Tax lottery tickets. I also think a good prize would be a "get out of audit free" card. Source: " Try Your Luck, at the I.R.S. Wheel ," by John Schwartz, the New York Times, February 7, 2014. Follow up: Read the essay linked above. Do you think it is a satiric essay, much like an article in The Onion ? Or do you think it proposes a business idea whose time has come? [suggestion: Do a search for a "modest proposal."] What is "surge" pricing? What are the pros and cons of using surge pricing?
  • A social network just for college students...sound familiar?

    image of Evan Rosenbaum, Akash Nigam and Matt Geige of Blend. It's " deja vu all over again." Blend is a social networking site that is for college students only. This might sound familiar because that is how Facebook started, on Harvard's campus. I remember my students telling me...back in 2006...that they could "get me onto Facebook" because I had an email address that ended in .edu, but that most "grown-ups" were excluded. Now the demographics of Facebook have shifted. According to iStrategyBlabs , 3 million young people (under 25) have left Facebook within the last three years...while the number of users over 55 years old have increased by 80%. Does this sound like a "party" you'd like to be at as a college student? Here is how Blend works: A theme is posted each day, such as "Tailgate Saturday, Library Shenanigans or My Pet Is Better Than Yours." Users post photos relevant to the themes. Other users can "snap" the photos they "like." Photo-posters can earn points based on the number of snaps received to be redeemed as gift cards for Blend advertisers. Ads are inserted between every six photos. Blend has set up 4 seasonal campaigns a benchmarks for advertisers. Student "influencers" approve potential advertisers, and act as their representatives on each campus. Observers have tracked steady growth for Blend. Where will it be 3 years from now? Source: " A Social Network That’s Just for College Students ," by Eileen Zimmerman, the New York Times--You're the Boss, February 6, 2014. Follow up: How much do you use Facebook? How about other social networking sites? Make a pie chart showing the relative amounts of time you spend on various sites. What is your reaction to Blend ? What do you think of its motto: "Share, snap, score"? Evaluate its business and monetization strategies. What are some indicators of Blend's future success or failure? To whom is the phrase "it's deja vu all over again" attributed, and why is it funny?
  • Nintendo and the State of the Union

    Link to audio from the Marketplace Website On the same day that President Obama was expressing optimism about the economic future in the State of the Union address, Nintendo was announcing its dismal third quarter profits. Nintendo is facing a flex point in its product cycle. For its business life so far (about 30 years), Nintendo has made games that have to be played on Nintendo hardware. image from The problem is that in 2014--every smart phone is also a mobile game-playing device. The convenience of carrying around a game station in the same device as one's phone might trump the bells and whistles that can be experienced on a dedicated device. Not to mention that at least some version of many game apps is FREE. It is probably time for Nintendo to re-think its business plan. Source: " Will Nintendo Ditch Hardware ?" by Kate Davidson, Marketplace--American Public Media , January 29, 2014. Follow up: What are Nintendo's options in terms of product mix and marketing? What are your personal game playing habits? How have they shifted over the past 5 or 10 years? How do you think they will change in the future?
  • Your reputation: how do you manage it online??

    image from According to Cheryl Conner, in an interview in Forbes magazine, " Fake Internet reviews and attack websites are becoming more and more common.... 'Ex-file' attacks are appearing on websites ranging from,,, to Google Places. " In addition, businesses are also vulnerable. "Reviews" on various sites can be skewed in a small population of reviews by one or two negative reviews. Medical professionals as well as restaurants can be affected. Three strategies to protect a business reputation were suggested: Protection : encourage happy customers to write positive reviews. Preventing negative cyber-press is easier than fixing damage after-the-fact. Monitoring : Doing a complete review of your online reputation weekly can help nip problems before they go viral. Defense : When your reputation has been harmed, you need to take action to correct the situation. Dr. Chris Anderson of Cyber Investigation Services suggests these possible responses to defend against negative press: Doing nothing Crafting a polished written response Trying to resolve the issue with the poster Asking the website to step in Identifying an anonymous poster Using legal letters to threaten the poster Filing a lawsuit to seek damages and force removal Sources: " Managing an Online Reputation " by Kermit Patterson, New York Times Small Business, July 29, 2009. " Protecting Your Online Reputation: 3 Key Tasks Your Business Must Complete in 2014 ," by Cheryl Conner, Forbes , December 9, 2013. Follow up: Has your email or social networking site ever been hacked? Have you ever done an internet search on yourself and found information that was incorrect? What have you done to correct the situation? If it was not resolved promptly, did the information online do harm to your reputation, either private or public? What steps have you already taken to protect your online reputation?
  • Most expensive cell phone service...can you hear me now?

    image from What are you spending on your smartphone and wireless internet service? Is it the best price that you can get? A recent survey by Cowen and Company reported that Verizon Wireless customers may pay the most. Verizon has no intention of reducing their prices. So why are Verizon customers willing to pay more? Maybe it is because, in many markets, Verizon service covers more areas. But a savvy consumer needs to research whether or not the increased coverage area actually affects their particular market. The survey found that: Verizon bills averaged $148 per month; Sprint bills averaged $144 per month; AT&T averaged $141 per months; T-Mobile bills averaged $120 per month. Can you hear me now? Source: " Guess which wireless carrier has the biggest bills in America " by Zach Epstein, BGR: Boy Genius Report , January 1 7 , 2014, from a story picked up by Ars Technica . Follow up: What were the major and minor factors that influenced your personal choice of smartphone service? What is an oligopoly? Does that term apply to the wireless service market? How does that affect consumers? Where does the phrase "Can you hear me now?" originate? Why is it notable?
  • Target: too little, too late?

    This letter was in my personal email Inbox this morning...several weeks after the cyber-crime event: Dear Target Guest, As you may have heard or read, Target learned in mid-December that criminals forced their way into our systems and took guest information, including debit and credit card data. Late last week, as part of our ongoing investigation, we learned that additional information, including name, mailing address, phone number or email address, was also taken. I am writing to make you aware that your name, mailing address, phone number or email address may have been taken during the intrusion. I am truly sorry this incident occurred and sincerely regret any inconvenience it may cause you. Because we value you as a guest and your trust is important to us, Target is offering one year of free credit monitoring to all Target guests who shopped in U.S. stores, through Experian’s® ProtectMyID® product which includes identity theft insurance where available. To receive your unique activation code for this service, please go to and register before April 23, 2014. Activation codes must be redeemed by April 30, 2014. In addition, to guard against possible scams, always be cautious about sharing personal information, such as Social Security numbers, passwords, user IDs and financial account information. Here are some tips that will help protect you: Never share information with anyone over the phone, email or text, even if they claim to be someone you know or do business with. Instead, ask for a call-back number. Delete texts immediately from numbers or names you don’t recognize. Be wary of emails that ask for money or send you to suspicious websites. Don’t click links within emails you don’t recognize. Target’s email communication regarding this incident will never ask you to provide personal or sensitive information. Thank you for your patience and loyalty to Target. You can find additional information and FAQs about this incident at our website. If you have further questions, you may call us at 866-852-8680. Chairman, President and CEO I read the letter carefully, noting the apology and the offer to do credit monitoring. I also had a chuckle at the fact that Target was offering ME advice on how to protect my online identity...when Target was obviously not an expert. Source: email dated January 17th at 8:00 am, sent to the email associated with the Target credit card account of Teri Bernstein. Follow up: Do you think that Target's apology letter and offer are adequate compensation for this breach in their security system? Research the time and costs that may be incurred by an individual when they are a victim of identity theft. Would you take Target up on its offer? Check out the Experian link and evaluate the offer. Are there any potential hidden costs to the person enrolling in the Experian program?
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