Monthly Archives: October 2014

Taseko’s New Prosperity Mine or Tsilhqot’in’s Tribal Park?

The Dasiqox Tribal Park includes Fish Lake, above, as well as the site of Taseko’s proposed New Prosperity mine. Photo by Garth Lenz

What strikes harder than the opportunity cost of delaying a billion dollar project and moving forward is the cost of revitalizing a company’s public image once it is ruined.

Taseko’s proposed new prosperity mine has been in the spotlight due to its clash with Canada’s First Nation’s values. The $1.1 billion copper-gold project will not be able to move forward until social and environmental issues are settled between Taseko Mines Ltd and the First Nation.

From a historical and social stance, the natives seem to have more rights to claim their land and its nearby surroundings. Their rationale is based on culture and environmental concerns that, to say the least, sounds more favorable than big scale business projects that may hinder sustainable development.

Evidently, this issue seems to put Taseko in an unfamiliar situation. It is crucial for Taseko to delve into more research and develop communication with the First Nation (which, the letter of understanding will become beneficial) since there is much ambiguity about what a tribal park is, how it is constituted and what the governing rules of the park are.

With Taseko’s project and Tsilhqot’in’s land at stake, both groups might want to consider moving into a strategic alliance as other aboriginal and non-aboriginal companies have done. The alliance will enhance the project’s strength and the native’s opportunity of giving and receiving employment respectively.

Nevertheless, Taseko should always consider what the effects to their public image are once a decision has been made. It is easier for profit making companies to become the target of social or environmental criticism by various stakeholder groups.

An Outlook On Netflix’s International Streaming

If not one of the first, Netflix is the leading internet TV provider with the most subscriptions in the states. They see faster and more accessible internet as an opportunity to build their platform on. In recent years, they are looking to expand into unreached countries such as New Zealand and Europe. However, there are still a few hurdles to overcome in order to reach a successful international scale:

Domestic vs. International Margin Contributions:

So far, domestic streaming contribution is still much higher than Netflix’s international streaming contribution despite already having subscribers in 40 countries worldwide. Forbes predicts that what stands between Netflix’s domestic and international success are content acquisition costs.

Technical Barriers:

Further content acquisition costs due to technical barriers. E.g. censorship, language, and other localized contents that need to be tailored for specific countries.

So how will Netflix overcome these barriers while not compromising current user experience?

Well, Netflix’s long term view and consistent expansion seems to be what investors and consumers hold on to. Their strategy is to grow content spending plus marketing more slowly than they grow revenue, so still keeping the promise of providing new content. And while content acquisition costs might be an impeding factor to their growth rate, they are negotiating these costs as fixed costs. Over time, these costs will be more spread out as they gain more subscribers.

However, there’s a catch: to successfully gain more subscribers worldwide, Netflix will see their marketing expenses go up (at least in the short run).

Starbucks and Fair Trade

Drawing from Rene’s post, many business are now focusing on being socially responsible. Likewise, the value of being socially responsible is gradually diminishing as more and more companies are using it differentiate themselves. However, big companies such as Starbucks are more successful in doing so since they are seen as trendsetters and have more financial backup to actually implement fair trade.

They will have the ability to mark up their price based on the justification of using fair trade and people won’t have any problems with that. As a multinational company, their public image will also improve across the globe with this step. Consumers and potential employees who are socially concious will most likely choose Starbucks over other coffee shops because they feel as if the company holds the same value as they do.

Hence, I agree that by implementing fair trade, Starbucks will only become more profitable. Not only will it help Starbucks’ marketing department, but it will also help their human resource department as more people are willing to genuinely seek a company who shares the same value. In this case, that value would be helping producers in developing countries achieve better trading conditions and promote sustainability.