Harold Maass of The Week The Best of Today's Business

WiMax cleared for takeoff

Sprint Nextel said it's merging its proposed high-speed WiMax wireless broadband network with Clearwire, with a $3.2 billion investment from tech companies, to create a $14.6 billion wireless communications company. The investors include Intel, Google, Time Warner, and Comcast; they will get a combined 22 percent stake in the venture. (AP in Yahoo! Finance) WiMax promises to cover entire cities with wireless access up to five times faster than current wireless networks. (Reuters) The two companies, which are both struggling, scrapped an earlier WiMax alliance last November. The new deal is "a positive for Sprint, but potentially transformational for Clearwire," said Stanford Group analyst Michael Nelson. (Bloomberg)

Cisco weathers economic turbulence

Networking heavyweight Cisco Systems reported a 5 percent drop in quarterly profit, to $1.17 billion, beating analysts' forecasts. The earnings were weighed down by a $246 million charge related to the acquisition of Nuova Systems. (MarketWatch) Revenue grew 10.4 percent, and Cisco cautiously forecast 9 percent to 10 percent growth for the current quarter. Cisco's routers and switches can cost millions of dollars, and are therefore vulnerable to a slowdown in corporate spending. (AP in Yahoo! Finance) "It's a good solid report relative to expectations and relative to the macro environment going in," said analyst Mark McKechnie at American Technology Research. (Reuters)

Disney beats the slump

Walt Disney Co. reported a better-than-expected 22 percent rise in quarterly profits, to $1.13 billion, as its theme parks did well in the sluggish economy and its studio division thrived. (MarketWatch) Revenue at Disney's network division, which includes ABC, rose 5 percent, despite the writers' strike. Sales at the parks unit grew 11 percent, and movie studio revenue jumped 18 percent. (AP in Yahoo! Finance) Disney was able to outperform its competitors in part by taking advantage of its diverse portfolio and cross-marketing its successful franchises, like "Hannah Montana." "They seem to have integrated better than a lot of their competitors," said Argus Research analyst Joseph Bonner. (CNNMoney.com)

The decline of airline civility

Airplane passengers are increasingly behaving more inappropriately on flights, according to flight attendants and frequent fliers. The behavior ranges from sex acts to public grooming to handing stewardesses dirty diapers while they are serving food. A common complaint is finding foul surprises in seat-back pockets. Psychologists suggest that people view flying as a time of suspended reality. Other blame declining airline service standards. "Increasingly, passengers are certain that the airlines are not on their side and actually don't care anything about them," said University of Washington psychologist Irwin Sarason. "It isn't too surprising that people will not exercise the restraints they normally would." (The Wall Street Journal)

BEST COLUMNS OF THE DAY

Inflation and perception

With everything from gas to college getting noticeably more expensive, the official inflation rate may seem artificially low, says David Leonhardt in The New York Times. If anything, it's "artificially high." This doesn't meld with most people's "day-to-day reality" at the gas pump and in supermarkets. But the prices for oranges and furniture have fallen in the last year -- did you notice? And the price of many other foods and goods have risen much slower than wages for the past two decades, thanks to "a combination of government subsidies, global trade, and the rise of industrial farms." Because "price increases are simply more noticeable," inflation may seem higher than 4 percent. But really "it’s not as bad as it feels."

A renters' revolt

As Congress works on its "costly" plans to "bail out homeowners," says Diana Furchtgott-Roth in The New York Sun, renters are starting to get angry. Pending bills would help homeowners at risk of foreclosure refinance with government subsidies. But why should renters' tax dollars go toward rescuing greedy builders and "homeowners when they don’t even own a home?" they ask. "Their frustration is understandable," but other groups would take a hit, too. Some "92% of homeowners were keeping up with their payments" last quarter, and foreclosures are concentrated in the "relatively wealthy states" of New York, Florida, and California. The problems in these states could "spill over," but many renters are willing to take that risk.

GOOD DAY FOR: Virtual crime, after Take-Two Interactive's "Grand Theft Auto IV" raked in $500 million in sales in its first week on the shelves. Six million people purchased the violent video game, with 3.6 million copies sold on the first day alone. Analysts were expecting five million copies sold in the first two weeks. (The New York Times, free registration)

BAD DAY FOR: Weathering storms, after beleaguered Swiss bank UBS said it is being investigated for tax evasion by the U.S. Justice Department. The accusation that UBS has helped wealthy clients avoid U.S. taxes comes after such clients, spooked by massive writedowns, pulled $12.1 billion from its wealth- and asset-management units. "UBS has been hit by a perfect storm," said Edwin Merner at Atlantis Investment Research. (Bloomberg)

NOTED: The Screen Actors Guild and Hollywood studios ended three weeks of contract negotiations with no agreement, raising concerns of another costly strike in the movie and TV industry. The current contract doesn't end until June 30. (Reuters)

This column was written by Peter Weber and edited by Harold Maass of TheWeekDaily.com.