This subscriber loss may haunt RIM in coming months

RIM’s (RIMM) share price popped by 8% soon after it released its earnings, buoyed by positive sales and earnings surprises. The fact that RIM managed to beat expectations on both fronts is a real achievement. The company has been able to manage the 50% annualized decline in device volume a lot more gracefully than most investors expected. The adjusted EPS loss of $0.22 was much smaller than the $0.36 loss Wall Street expected. However, there is a fly in the ointment the size of a hamster — for the first time ever, the base of BlackBerry subscribers has started shrinking globally. Wall Street expected RIM to add 300,000 new subscribers. Instead, the company lost about a million, with the number of total subscribers dipping from 80 million to 79 million in three months.
[More from BGR: RIM’s first BlackBerry 10 smartphone to be called the ‘Z10′]
The key surprise in RIM’s summer quarter was the company’s ability to expand its subscriber base even as its sales in the United States and the United Kingdom markets tanked. That was one of the factors that underpinned the strong share price rebound during the autumn. And the key surprise in RIM’s November quarter is the new trend of subscriber base decline. What has been crucially important for RIM over the past dark year is the rock solid loyalty of its emerging market customers in South Africa, Nigeria, Indonesia, Malaysia, the Philippines and Brazil. Those markets have enabled RIM to beat subscriber base estimates for four quarters running, even as American and British consumers abandoned the brand.
[More from BGR: RIM beats estimates in Q3, but subscriber base shrinks]
That loyalty may now be wobbling. Nokia (NOK) launched a broad range of very cheap Asha QWERTY models in the beginning of 2012 and has been pushing these models aggressively into Africa and Asia over the past two quarters. Samsung (005930) has moved into bargain basement level with its own Android QWERTY devices dropping to the 5,000 rupee level and below in India. This pincer move may have started to take its toll on RIM.
RIM added 2 million subscribers during the August quarter and then lost 1 million in the November quarter. It’s hard to estimate precise rates, because RIM refuses to give out detailed information but this could represent a swing from 9% annualized growth to 4% annualized decline in just three months.
In a couple of months, RIM will launch a new range of Blackberry models with a spanking new OS and appealing revamp of the Blackberry Messenger software. But the first models coming out will be expensive and aimed at business users. The low-end erosion that the autumn subscriber loss indicates may bite deep during the February and May quarters. What RIM really needs badly is a range of appealing new QWERTY devices priced well below $200 in retail. It is not clear when these devices will arrive. Much hinges now on whether RIM has an aggressive low-end strategy in place or whether the company will chase the dream of reconquering its high-end prominence.
Messaging apps like 2go and WhatsApp are growing at breakneck speed in Africa and Asia — they knit together users of various platforms from iOS to Android to S40 to Blackberry. The subscriber contraction of the November quarter indicates that RIM needs to somehow revive the emerging market interest in BBM very soon. The short squeeze that started in October is still driving RIM’s share price higher. But over the coming weeks we may well see investors begin to ponder the year 2013 subscriber trajectory.

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Distracted Pedestrian Crashes WABC Meteorologist's Live Weather Report

WABC-TV meteorologist Lee Goldberg was doing a live weather report on the sidewalk outside the station's studios on Columbus Avenue in Manhattan today when he was unceremoniously interrupted by a pedestrian who was distracted by his cell phone.
Goldberg was doing the live report when the pedestrian, looking intently at his cell phone, walked up behind Goldberg. The pedestrian veered off to the side, but then walked directly in front of the camera while looking at Goldberg.
Goldberg stopped his report to watch as the man walked through the shot. Then, holding out his palm and pantomiming someone looking at a cell phone, said: "Everybody's looking at their texts … and then they walk right through. That's pretty good," he said, adding with apparent irony, "Happy holidays."
The news anchors in the studio - David Novarro and Liz Cho - got a good laugh out of the whole thing.
"You're just another guy talking to a TV camera in the middle of the street. Get out of my way," Navarro joked, channeling the unidentified pedestrian.
He added in an exaggerated New York accent, "I'm shopping here!"

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RIM loses BlackBerry subscribers for first time

 Research In Motion's stock plunged in after-hours trading Thursday after the BlackBerry maker said it plans to change the way it charges fees.
RIM also announced that it lost subscribers for the first time in the latest quarter, as the global number of BlackBerry users dipped to 79 million.
In a rare positive sign, the Canadian company added to its cash position during the quarter as it prepared to launch new smartphones on Jan. 30. The new devices are deemed critical to the company's survival.
RIM's stock initially jumped more than 8 percent in after-hours trading on that news, but then fell $1.48, or 10.4 percent, to $12.65 after RIM said on a conference call that it won't generate as much revenue from telecommunications carriers once it releases the new BlackBerry 10 platform.
RIM is changing the way it charges service fees, putting an important source of revenue at risk. RIM CEO Thorsten Heins said only subscribers who want enhanced security will pay fees under the new system.
"Other subscribers who do not utilize such services are expected to generate less or no service revenue," Heins said. "The mix in level of service fees revenue will change going forward and will be under pressure over the next year during this transition."
RIM's stock had been on a three-month rally that has seen the stock more than double from its lowest level since 2003.
But Mike Walkley, an analyst with Canaccord Genuity, said BlackBerry 10 will change RIM's services revenue model dramatically. He said that instead of getting about $6 per device each month from carriers and users RIM could get as little as zero.
"That's what turned the stock from being up 10 percent to being down 10 percent," Walkley said. "That's been part of our worry. How do they come back with a new platform and get carriers to continue to share the higher revenue —which sounds like they are not going to— and then subsidize the phone to make it affordable for consumers and enterprises."
"People are seeing that the services revenue has a lot of risk to it now with the BlackBerry 10 migration."
Three months ago, RIM had 80 million subscribers. Analysts said the loss of 1 million subscribers was expected. Once coveted symbols of an always-connected lifestyle, BlackBerry phones have lost their luster to Apple's iPhone and phones that run on Google's Android software.
RIM is banking its future on its much-delayed BlackBerry 10 platform, which is meant to offer the multimedia, Internet browsing and apps experience that customers now demand.
"We believe the company has stabilized and will turn the corner in the next year," Heins said. He noted that the company's cash holdings grew by $600 million in the quarter to $2.9 billion, even after the funding of all its restructuring costs. RIM previously announced 5,000 layoffs this year.
Heins said subscribers in North America showed the largest decline, but said there is growth overseas.
Colin Gillis, an analyst with BGC Financial, said before the conference call that the company bought itself more time.
"It doesn't mean (BlackBerry) 10 will gain traction. A lot of people said 10 would be DOA, but I don't think that's going to be the case," he said.
Jefferies analyst Peter Misek also earlier called the results better than expected, noting that RIM added a significant amount of cash. RIM will need the money to advertise the new BlackBerrys and operating system.
Misek also called it a positive development that RIM said there would not be another delay to BlackBerry 10.
"The success or failure of this company will be on BlackBerry 10," Misek said.
RIM posted net income of $14 million, or 3 cents per share for its fiscal third quarter, which ended Dec. 1. That compares with a profit of $265 million, or 51 cents per share, in the same quarter a year ago.
The latest figure includes a favorable tax settlement. Excluding that adjustment, RIM lost 22 cents per share. Analysts polled by FactSet were expecting a wider loss of 27 cents.
RIM reported revenue of $2.7 billion, down 47 percent from a year ago.

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When South Korean automaker Hyundai Motor Co announced last month it had overstated the fuel efficiency levels on around one million of its cars in the United States and Canada some investors were left fuming more than others. Some had already sold their shares before the announcement on November 2. The stock fell 4 percent on November 1 with about 2.2 million shares changing hands, the highest trading volume of the year at that point. "This smells pretty bad," said Robert Boxwell, director of consulting firm Opera Advisors in Kuala Lumpur who has studied insider dealing patterns. "It would have fallen into our suspect trading category," he added. Boxwell spots suspect trading by looking at how much the volume diverges from the average level in the days before a market moving announcement. In the Hyundai instance, the volume was more than five standard deviations, a measure of variation, away from the daily average of 598,741 shares over the past year. A Hyundai spokeswoman declined to comment. Research from the Capital Markets Co-operative Research Centre (CMCRC), an academic centre in Sydney that studies financial market efficiency, found that 26 percent of price-sensitive announcements in Asia Pacific markets showed signs of leakage in the first quarter of this year, the most recent period for which data was available. That compared with 13 percent in North American markets. The CMCRC says it looks for suspected information leaks by examining abnormal price moves and trading volumes ahead of price-sensitive announcements. Investors say one reason for leaks in Asia has been low enforcement rates for insider trading and breaches of disclosure rules. Enforcement in some markets is virtually non-existent. There are also misconceptions about whether trading on non-public information is a crime. "The idea that insider trading is wrong rather than smart is only being ingrained in the current generation of Asian players, not the older generation who are often still in the driving seat," said Peter Douglas, founder of GFIA, a hedge fund consultancy in Singapore. LOSS OF CONFIDENCE Japan's largest investment bank Nomura Holdings was embarrassed this year after regulatory investigations found it leaked information to clients ahead of three public share offerings. Nomura has acknowledged that its employees leaked information on three share issues it underwrote in 2010. In June, it published the results of an internal investigation that found breaches of basic investment banking safeguards against leaking confidential information and announced a raft of measures to prevent recurrence. The bank was also fined 200 million yen ($2.37 million) by the Tokyo Stock Exchange and 300 million yen by the Japan Securities Dealers Association. Such leaks hurt companies' share prices in the long run because investors put in less money if they feel they are not on a level playing field. "It is very damaging. You may not know how much money you've lost but if there is not confidence that the regulators are prosecuting and enforcing the rules on this then it undermines investor confidence and liquidity," said Jamie Allen, secretary general of the Asian Corporate Governance Association. The issue isn't being ignored. Many Asian markets such as Hong Kong and China have tightened their rules on insider trading over the past decade. Indeed some investors feel that while leaks and insider dealing are unfair, regulators in the region have more serious issues they should be tackling. "I would like to see the regulators spend more resources on investigating and prosecuting fraud against listed companies, which severely damages shareholder value," said David Webb, a corporate governance activist in Hong Kong, arguing insider dealing as less of an impact on a company's long-term share price. HTC AND APPLE A week after Hyundai's announcement about its problems in the United States, there was an unexpected move on the Taiwan Stock Exchange. Shares in smartphone maker HTC Corp jumped almost seven percent on Friday, November 9, hitting the daily upper trading limit. On Sunday came the surprise announcement that the company was ending its long-running patent dispute with Apple Inc , a move seen as a positive for the stock. The Taiwan bourse announced it was investigating the trading patterns to see if there was a possible leak. When asked for comment, HTC referred back to a November 13 statement in which the company said it had kept the Apple settlement process confidential and has strict controls on insider trading. Michael Lin, a spokesman for the Taiwan Exchange, told Reuters on Friday that the bourse is still working with the regulator on the case. 'ENORMOUS LOSSES' Michael Aitken, who oversees research at the CMCRC, said many other Asian markets lack tough enough rules to force information to be released as efficiently and timely as possible, a primary reason for the prevalence of leaks. "Poor regulation hampers enforcement efforts," he said pointing out that few markets have the "continuous disclosure" rules used in Australia which require listed companies to release material information as soon as possible. In Korea, when Hyundai shares started to fall, rumours began swirling that news about a problem with some of its cars was on its way, but investors say it took the company too long to disclose what exactly was happening. "Hyundai at that time did not confirm the rumours. We suffered enormous losses because of this," said one fund manager, who declined to be named because he was not authorised to speak to the media. An official from Korea Exchange declined to comment on whether it was investigating this case, saying only that the exchange looks carefully into possible cases of insider trading. Across Asia, regulators concede that many company executives and insiders still do not appreciate that leaking or trading on material, non-public information is an offence. "People don't even know they are engaging in insider trading, for example if their friends are talking about it on the golf course," said Tong Daochi director-general for international affairs at the China Securities Regulatory Commission, during a regulation conference last month. "We try to tell society, what are the criminal issues, what are the insider trading issues? For example we have held 27 press conferences to tell the public what kind of activities are involved in insider trading and to let people know that this is an active crime." ($1 = 84.2600 Japanese yen) ($1 = 0.6147 British pounds)

Research In Motion shares tumbled more than 10 percent on Thursday after the company reported the first ever decline in its subscriber numbers and outlined plans to transform the way it charges for its BlackBerry services.
RIM, which hopes to revive its fortunes and reinvent itself via the launch of a brand new line of BlackBerry 10 devices next month, caught investors off-guard on its quarterly conference call, when it said it plans to alter its service revenue model - a move that will pressure the high-margin business that accounts for about a third of RIM's sales.
"RIM provided few details regarding the economics of these changes, thus adding a large cloud of uncertainty to the primary driver of its profitability, which we view as especially worrisome given risks already surrounding the firm's massive BlackBerry 10 transition," said Morningstar analyst Brian Colello.
Those subscribers who need enhanced services like advanced security will pay for these services, while those who do not use such services will generate much lower to no service revenue, RIM Chief Executive Thorsten Heins told analysts and investors on a conference call on Thursday.
"I want to be very clear on this. Service revenues are not going away, but our business model and service offerings are going to evolve ... The mix in level of service fees revenue will change going forward and will be under pressure over the next year," cautioned Heins.
The news startled investors, who had earlier in the evening pushed RIM's stock more than 7 percent higher in post-market trading, after the company reported a narrower-than-expected quarterly loss and said it boosted its cash cushion ahead of next month's crucial launch of the BlackBerry 10 smartphone.
RIM's shares have for weeks been on a tear as optimism around BB10 has grown. Following RIM's surprise announcement on service revenues, however, the stock ended 9 percent lower at $12.85 in trading after the closing bell.
Analysts also expressed concern about the decline in RIM's subscriber base.
"The early reaction was probably just 'Hey, numbers looked OK, better loss, the cash flow was good' but if you know the company, you're looking at the subscriber base falling off," said Mark McKechnie at Evercore Partners in San Francisco.
CASH BALANCE
One reason the shares rose earlier was RIM managed to build up its cash cushion to $2.9 billion from $2.3 billion in the previous quarter.
Analysts have been keeping a sharp eye on the size of RIM's cash pile, as RIM will need the funds to manufacture and effectively promote BlackBerry 10 in a crowded market.
RIM is counting on the new line to claw back market share lost in recent years to the likes of Apple Inc's iPhone and a slew of devices powered by Google Inc's Android operating system.
"They've done a great job at generating cash," said Raymond James analyst Tavis McCourt in Nashville. "They're certainly in a much better position than they were three or four quarters ago."
The Waterloo, Ontario-based company said it is now testing its BB10 devices with more than 150 carriers - up from about 50 carriers as of the end of October. RIM expects more carriers to come on board ahead of the formal launch of BB10 on January 30.
Positive feedback from developers and carriers around RIM's new BlackBerry 10 devices has buoyed the stock in the last three months. Despite the plunge in RIM's share price on Thursday, the stock has more than doubled in value the last three months.
SMALLER-THAN-EXPECTED LOSS
On an operating basis, RIM fared a little better than Wall Street had expected. It reported a loss of $114 million or 22 cents a share, excluding one-time items. Analysts, on average, had forecast a loss of 35 cents a share, according to Thomson Reuters I/B/E/S.
RIM also reported a surprise net profit of $9 million, or 2 cents a share, for its fiscal third quarter ended December 1, on the back of a one-time income tax related gain. That compared with a year-ago profit of $265 million, or 51 cents.
RIM said it shipped 6.9 million smartphones in the quarter, even as its subscriber base fell to about 79 million in the quarter from about 80 million in the period ended September 1.
In recent years, RIM's user base has grown, even as the BlackBerry lost ground in North America and Europe, boosted by gains in emerging markets. While eye opening, the shrinkage was not as bad as some observers expected during the last quarter before the BB10 launch.
"We're encouraged that the subscriber base only declined slightly during a very public transition, and BlackBerry sales were about what we expected," said Morningstar's Colello, who is based in Chicago.

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Insiders steal a march in leak prone Asian markets

When South Korean automaker Hyundai Motor Co announced last month it had overstated the fuel efficiency levels on around one million of its cars in the United States and Canada some investors were left fuming more than others.
Some had already sold their shares before the announcement on November 2. The stock fell 4 percent on November 1 with about 2.2 million shares changing hands, the highest trading volume of the year at that point.
"This smells pretty bad," said Robert Boxwell, director of consulting firm Opera Advisors in Kuala Lumpur who has studied insider dealing patterns.
"It would have fallen into our suspect trading category," he added.
Boxwell spots suspect trading by looking at how much the volume diverges from the average level in the days before a market moving announcement. In the Hyundai instance, the volume was more than five standard deviations, a measure of variation, away from the daily average of 598,741 shares over the past year.
A Hyundai spokeswoman declined to comment.
Research from the Capital Markets Co-operative Research Centre (CMCRC), an academic centre in Sydney that studies financial market efficiency, found that 26 percent of price-sensitive announcements in Asia Pacific markets showed signs of leakage in the first quarter of this year, the most recent period for which data was available.
That compared with 13 percent in North American markets.
The CMCRC says it looks for suspected information leaks by examining abnormal price moves and trading volumes ahead of price-sensitive announcements.
Investors say one reason for leaks in Asia has been low enforcement rates for insider trading and breaches of disclosure rules. Enforcement in some markets is virtually non-existent.
There are also misconceptions about whether trading on non-public information is a crime.
"The idea that insider trading is wrong rather than smart is only being ingrained in the current generation of Asian players, not the older generation who are often still in the driving seat," said Peter Douglas, founder of GFIA, a hedge fund consultancy in Singapore.
LOSS OF CONFIDENCE
Japan's largest investment bank Nomura Holdings was embarrassed this year after regulatory investigations found it leaked information to clients ahead of three public share offerings.
Nomura has acknowledged that its employees leaked information on three share issues it underwrote in 2010. In June, it published the results of an internal investigation that found breaches of basic investment banking safeguards against leaking confidential information and announced a raft of measures to prevent recurrence.
The bank was also fined 200 million yen ($2.37 million) by the Tokyo Stock Exchange and 300 million yen by the Japan Securities Dealers Association.
Such leaks hurt companies' share prices in the long run because investors put in less money if they feel they are not on a level playing field.
"It is very damaging. You may not know how much money you've lost but if there is not confidence that the regulators are prosecuting and enforcing the rules on this then it undermines investor confidence and liquidity," said Jamie Allen, secretary general of the Asian Corporate Governance Association.
The issue isn't being ignored. Many Asian markets such as Hong Kong and China have tightened their rules on insider trading over the past decade.
Indeed some investors feel that while leaks and insider dealing are unfair, regulators in the region have more serious issues they should be tackling.
"I would like to see the regulators spend more resources on investigating and prosecuting fraud against listed companies, which severely damages shareholder value," said David Webb, a corporate governance activist in Hong Kong, arguing insider dealing as less of an impact on a company's long-term share price.
HTC AND APPLE
A week after Hyundai's announcement about its problems in the United States, there was an unexpected move on the Taiwan Stock Exchange.
Shares in smartphone maker HTC Corp jumped almost seven percent on Friday, November 9, hitting the daily upper trading limit. On Sunday came the surprise announcement that the company was ending its long-running patent dispute with Apple Inc , a move seen as a positive for the stock.
The Taiwan bourse announced it was investigating the trading patterns to see if there was a possible leak.
When asked for comment, HTC referred back to a November 13 statement in which the company said it had kept the Apple settlement process confidential and has strict controls on insider trading.
Michael Lin, a spokesman for the Taiwan Exchange, told Reuters on Friday that the bourse is still working with the regulator on the case.
'ENORMOUS LOSSES'
Michael Aitken, who oversees research at the CMCRC, said many other Asian markets lack tough enough rules to force information to be released as efficiently and timely as possible, a primary reason for the prevalence of leaks.
"Poor regulation hampers enforcement efforts," he said pointing out that few markets have the "continuous disclosure" rules used in Australia which require listed companies to release material information as soon as possible.
In Korea, when Hyundai shares started to fall, rumours began swirling that news about a problem with some of its cars was on its way, but investors say it took the company too long to disclose what exactly was happening.
"Hyundai at that time did not confirm the rumours. We suffered enormous losses because of this," said one fund manager, who declined to be named because he was not authorised to speak to the media.
An official from Korea Exchange declined to comment on whether it was investigating this case, saying only that the exchange looks carefully into possible cases of insider trading.
Across Asia, regulators concede that many company executives and insiders still do not appreciate that leaking or trading on material, non-public information is an offence.
"People don't even know they are engaging in insider trading, for example if their friends are talking about it on the golf course," said Tong Daochi director-general for international affairs at the China Securities Regulatory Commission, during a regulation conference last month.
"We try to tell society, what are the criminal issues, what are the insider trading issues? For example we have held 27 press conferences to tell the public what kind of activities are involved in insider trading and to let people know that this is an active crime." ($1 = 84.2600 Japanese yen) ($1 = 0.6147 British pounds)

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In Hezbollah stronghold, Lebanese Christians find respect, stability

In a home in a Shiite neighborhood in southern Beirut, images of Hezbollah leader Hassan Nasrallah share mantel and wall space with the Virgin Mary.
The face of the revered Shiite militant leader appears on posters, a calendar, and in several photographs nestled amid those of Christian homeowner Randa Gholam's family members. Mr. Nasrallah is, Ms. Gholam asserts amid a string of superlatives, “a gift from God.”
Lebanon’s sectarian divides are legendary, and the residents of the historically Christian neighborhood of Harat Hreik, now a Hezbollah stronghold, remember well the civil war that set Beirut on fire. They were literally caught in the middle of some of the most vicious fighting, with factions firing shots off at one another from either side of their apartment buildings.
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But in the intervening years, as Hezbollah cemented its control over the suburb of Dahiyeh, which includes Harat Hreik, the militant group has been an unexpected source of stability and even protection for the few remaining Christian families. Just a few blocks away from Nasrallah’s compound is St. Joseph’s Church, a vibrant church that Maronite Christians from across Beirut flock to every Sunday.
“I feel honored to be here. They are honest. They are not extremists. It’s not like everyone describes,” Gholam says. “I can speak on behalf of all my Christian friends. They would say the same thing."
The Christians living in Harat Hreik are a bit of an anomaly, to be sure. Christians represent a sizable population in Lebanon, though no census has been held in decades. And while Beirut's neighborhoods are gradually becoming more integrated, they still divide largely along religious lines. The fragile peace is under deep strain as regional tensions swirl because of the conflict next door in Syria.
NOT FANNING THE FLAMES
In Hezbollah's early days, its creed was "virulent," and in the past, it may have been responsible for fanning some of those flames. But as Hezbollah gained power and joined the political system, that changed, says Paul Salem, director of the Carnegie Endowment Middle East Center.
“It doesn’t carry with it an anti-Christian strain anymore," he says. "That’s almost entirely gone. It’s not in their rhetoric, it’s not in their creed.”
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Recently, when the Shiite holiday of Ashura was approaching, the streets were choked with residents shopping and passing out sweets and blanketed with black banners commemorating the martyrdom of Hussein Ali. But Christians live openly here, and they describe Hezbollah as a tolerant group that has steadfastly supported their presence, even sending Christmas cards to Christian neighbors like Gholam.
Gholam, who throws a party every year in honor of Nasrallah’s birthday and places a photo of him in her Christmas tree, is certainly an anomaly. But other Christian families also speak approvingly of their life under Hezbollah, especially when compared to its predecessor, Amal, which they say forced many Christian residents to sell their homes. In contrast, Hezbollah extended financial support to the Christian families when Dahiyeh needed rebuilding after the civil war and the 2006 war with Israel.
Rony Khoury, a Maronite Christian who was born in Harat Hreik and still lives in the same apartment, says he feels comfortable drinking alcohol on his front porch, in full view of members of Hezbollah, and his wife feels no pressure to don a head scarf or follow other rules governing Muslim women's attire. They have property in a predominantly Christian area of Beirut, but have no desire to move.
“After Hezbollah came, we didn’t have any worries,” Mr. Khoury says, citing safe streets. "The security is No. 1 in the world. I leave my car open, I forget something outside…. It's very safe now, under Hezbollah."
Only between 10 and 20 of the pre-civil war Christian families remain, out of the thousands who lived there before the fighting. While the numbers are low, Khoury insists that many would come back, if only they could afford it. But property values have climbed, and many of those who left can’t afford to move back.
Of course, there are calculations behind Hezbollah's magnanimity. Hezbollah’s political alliance with the Lebanese Christian political party, the Free Patriotic Movement, is important to the group, and it “bends over backward to keep those relations comfortable,” Mr. Salem says.
It might also be a way to one-up Sunnis in Lebanon, with whom Shiites are constantly vying for dominance. “They pride themselves on saying they’re more tolerant, more open than Sunnis. In Lebanon, it’s a point of pride,” Salem says.
Both Khoury and Gholam, as well as neighborhood Shiites who dropped by their homes, said there are far more issues with Sunnis.
"Shiite extremists like Hezbollah, they come to our church" as a show of support, says Khoury. "But Sunni extremists, like Salafis, they kill me, they kill you."
THINGS COULD CHANGE
Ultimately, it is Hezbollah’s foreign backers dictating the mood in Harat Hreik. If it became politically expedient for Hezbollah to abandon its acceptance of Christian neighbors, Hezbollah would be compelled to make life difficult for them.
“For Iran and Syria, their main backers, Hezbollah is mainly a strategic force against Israel. That’s the point – not creating an Islamic state or fighting a sectarian war," Salem says. “Hezbollah is a very top-down organization. If Iran decrees something else, something else will happen.”
But that’s not something Gholam can fathom.
"I will never even think about Hezbollah giving anyone a hard time. I can't even think about answering that question," she says.

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Delhi gang-rape case could be turning point for India's rape laws

The gang-rape and beating of a 23-year-old woman on a private bus as it cruised around Delhi Sunday could be the turning point for improvements in the country’s rape laws.
After nearly a week of massive protests across the capital demanding tougher punishments for rapists and better protection of women, the parliamentary standing committee will meet next week to discuss creating fast-track courts for those accused of rape.
Proposals for changes in the law come at a critical time. Many people say there is little deterrent for rapists: Because of social stigma, few females come forward to report the crime. Those that do often have to wait years for their cases to be heard. And even then, the conviction rate is just 34.6 percent, according to the National Crimes Record Bureau. Delhi has the highest number of rapes in the country, with 572 rapes reported last year. While Section 376 of the Indian Penal Code lists punishments of up to a life sentence for rape, those convicted are often let off after serving only a few months or years.
But fast-track courts could change how people think about such crimes by expediting the trial period. Proposed amendments would also provide better privacy for women with in-camera trials, which would keep them from being in the same room as the accused.
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While politicians and activists are encouraged that the public outrage could push parliament to reform laws, Anil Bairwa of the Association for Democratic Reforms says fast track courts will not solve the problem.
He points to a report released this week that found as many as 27 Indian politicians in senior positions have rape or molestation cases pending against them.
“When the politicians passing the legislation and governering states across India have themselves been accused of rape and molesting women, it really shows where this country is in its nascent laws to protect women. Hopefully fast-track courts and stiffer penalties will start bringing some of these people to task.”
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Leaders from all political walks of life have pledged their support to improve the safety of women in Delhi and across the country. That these normally polarized politicians could come together on this issue, says Nirmala Sitharaman, the national spokeswoman for the Baratiya Janta Party (BJP), shows that politicians are united in their pledge to improve the laws.
Ms. Sitharaman says the gruesome case that propelled the issue into the national spotlight shows how little perpetrators fear punishment: In the Delhi bus gang rape, both the woman and her friend who tried to protect her were thrown out of the moving bus – on a highway on the outskirts of the city, according to court testimony.
“Though the government may move slow in many areas, the commitment members of parliament have made to pass new legislation to protect women is real,” she says. “This terrible act has shaken the policymakers in this city to their core.”
But not everyone is convinced change is on the way. The pressure people across the city have been putting on the government this week must continue, says Dr. Vandana Prasad of the Ministry of Women and Child Development. “Announcements for changes in a law can mean something happening in one week or 10 years.”

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Good Reads: gun laws, lottery winners, online education, and tech gets sensory

The Sandy Hook school shooting in Connecticut brought a deluge of media attention to gun control. One useful perspective came from the Lexington’s Notebook column in The Economist magazine. Britain’s gun-related homicide rate is drastically lower than that of the United States not only because guns are harder to purchase, but because ammunition is scarce, the writer points out. In one recent incident in a crime-plagued British neighborhood, for example, “the gang had had to make its own bullets, which did not work well....”
In one recent year England and Wales experienced 39 fatalities from crimes involving firearms; the US had 12,000. In Britain, “The firearms-ownership rules are onerous, involving hours of paperwork. You must provide a referee who has to answer nosy questions about the applicant’s mental state, home life (including family or domestic tensions) and their attitude towards guns. In addition to criminal-record checks, the police talk to applicants’ family doctors and ask about any histories of alcohol or drug abuse or personality disorders.”
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Some US gun owners argue that they might need firearms to fight a tyrannical government. But “I don’t think America is remotely close to becoming a tyranny, and to suggest that it is is both irrational and a bit offensive to people who actually do live under tyrannical rule,” the writer responds.
LOTTERY BURDENS
Are you eager to win the next big lottery? BloombergBusinessWeek writer David Samuels offers the cautionary tale of Jack Whittaker, a contractor in Scott Depot, W. Va., who 10 years ago found that his $1 Powerball lottery ticket had won him a $93 million payout after taxes.
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Mr. Whittaker tried to do good with his bonanza, giving away a good portion to charitable groups, especially churches. But he still descended into alcohol addiction; was divorced by his wife; became tied up (by his own count) in some 460 legal actions; and lost his beloved granddaughter, on whom he had lavished piles of cash, to drug addiction. Before his lottery “win,” Whittaker’s contracting business had afforded him a comfortable life. “Nobody knew I had any money,” Whittaker said. “All they knew was my good works.” His life back then, he notes sadly, “was a lot easier.”
ONLINE COURSES VS. COLLEGE LIFE
Massive open online courses (MOOCs) are the wave of the future, “the end of higher education as we know it,” as one university president has predicted.Or are they? Writing in The Chronicle of Higher Education (“For Whom Is College Being Reinvented?”), Scott Carlson and Goldie Blumenstyk give Luddites their due. While it’s true that an online course conducted by a top teacher might trump a large lecture class offered by a second-rate live lecturer, those pushing MOOCs as inevitable should be heard with a skeptic’s ear.
“The idea that [students] can have better education and more access at lower cost through massive online courses is just preposterous,” says Patricia McGuire, president of Trinity Washington University in Washington, D.C. “There is an awful lot of hype about ... the need for reinvention that is being fomented by people who are going to make out like bandits on it.”
Even David Stavens, a founder of the MOOC provider Udacity, concedes that “there’s a magic that goes on inside a university campus that, if you can afford to live inside that bubble, is wonderful.”
HIGH-TECH TOUCH AND TASTE
IBM forecasts that within the next five years technology will vastly improve the way humans experience the five senses (sight, hearing, smell, taste, touch), according to a report in the Kurzweil Accelerating Intelligence newsletter. Online shoppers, for example, will be able to “touch” a product using mobile devices, “using haptic, infrared and pressure-sensitive technologies to simulate touch – such as the texture and weave of a fabric as a shopper brushes their finger over the image of the item on a device screen.”
Clever sensors will also be able to detect sounds in the form of pressure, vibrations, and sound waves. This data will allow predictions of events such as when a tree might fall or when a landslide is about to happen. “Baby talk” will be decoded as a language, letting parents or other caregivers know what infants are trying to communicate. Computer systems will learn to detect emotions and sense a person’s mood by analyzing factors such as pitch, tone, and hesitancy in speech, allowing automated call centers to be more helpful and understanding between human cultures to improve.
Even the finest chefs will be challenged by technology. Computer programs “will break down ingredients to their molecular level and blend the chemistry of food compounds with the psychology behind what flavors and smells humans prefer,” IBM predicts.
Healthy foods will be made more palatable – and programming will pair up foods in ways that maximize taste and flavor. “A system like this can also be used to help us eat healthier,” IBM predicts, “creating novel flavor combinations that will make us crave a vegetable casserole instead of potato chips.”

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Syrian civil war at stalemate, Assad won't go: Russia

BEIRUT (Reuters) - Syria's civil war has reached stalemate and international efforts to persuade President Bashar al-Assad to quit will fail, Russia's Foreign Minister Sergei Lavrov said on Saturday.
Mainly Sunni Muslim rebels seeking to overthrow Assad are fighting on the edge of the capital Damascus and expanding southwards from their northern strongholds in Aleppo and Idlib into the central province of Hama.
But Assad, from the Alawite minority linked to Shi'ite Islam, has responded with artillery, air strikes and - according to the NATO military alliance which is stationing anti-missile defenses in neighboring Turkey - with Scud-type missiles.
The Kremlin's Middle East envoy was quoted as saying earlier this month that the rebels could defeat Assad's forces and that Moscow was preparing a possible evacuation of Russians, the strongest signs yet that it is preparing for a post-Assad Syria.
That followed concerted calls from Western powers and some Arab countries for Assad to step down before Syria's 21-month-old conflict, which has killed more than 44,000 people according to activists, wreaks more destruction.
But Lavrov said the Syrian president was not about to bow to pressure from opponents or more sympathetic leaders in Moscow and Beijing.
"Listen, no one is going to win this war," he told reporters aboard a government plane en route to Moscow from the Russia-EU summit in Brussels. "Assad is not going anywhere, no matter what anyone says, be it China or Russia."
Lavrov said Russia had rejected requests from countries in the region to pressure Assad to go or offer him safe haven, and warned that his exit might lead to an upsurge in fighting.
He also said Syrian authorities were gathering the country's chemical weapons in one or two areas and that they were "under control" for the time being. "Currently the (Syrian) government is doing all it can to secure (chemical weapons), according to intelligence data we have and the West has," he said.
Western countries said three weeks ago that Assad's government might be preparing to use poison gas to counter rebels who are encamped around his capital and control rural Aleppo and Idlib in the north.
REBEL WARNINGS
In central Hama province, where rebels say they have taken most of the rural territory west of Hama city, fighters threatened to storm two mainly Christian towns which they said Assad's forces were using as bases to attack them.
A video released by the rebels showed seven armed fighters of the Ansar Brigade demanding that residents of Mahrada and al-Suqeilabiya evict Assad's forces.
In Aleppo, rebel leader Colonel Abdel-Jabbar al-Oqaidi said his fighters considered the skies above Aleppo to be a no-fly zone and repeated a warning that they would attack planes using the city's airport.
Snipers fired at an airliner preparing to take off from Aleppo on Thursday, forcing it to abandon its departure.
"The airport was being used as a military airport to transport troops and (Iranian) Revolutionary Guards," Oqaidi told Reuters. "We forbid planes from flying in Syrian air space. We will set up a no-fly zone."
In Damascus, a car bomb killed five people and wounded dozens in the eastern district of Qaboun on Saturday, the Syrian Observatory for Human Rights said.
Video footage which activists said was filmed at the site of the explosion showed a white car in flames in the centre of a street filled with concrete rubble and furniture from at least one building which had collapsed.
The British-based Observatory, which monitors violence across Syria through a network of sources on the ground, also reported clashes between rebels and forces loyal to Assad on the southern edge of the Yarmouk Palestinian refugee camp, taken over by rebels this week.
Three people were killed by snipers and the army sent reinforcements to the perimeter of Yarmouk, which is described as a camp but in reality is a dense concentration of concrete buildings housing descendants of Palestinians who fled the 1948 fighting at the creation of the state of Israel.
The Observatory says 44,000 people have been killed in Syria since the uprising erupted against Assad in March last year.
International envoy Lakhdar Brahimi, who tried in vain to secure a four-day truce in November to mark the Islamic holiday of Eid al-Adha, will visit Syria in the next few days for talks with Assad, a source in the Cairo-based Arab League said.
The source said no date for such a visit had been announced but he expected it would be within a few days. "Lakhdar Brahimi's team does not want to announce the time of the visit too early, perhaps for logistical or security reasons," he said.

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Pope pardons ex-butler who stole, leaked documents

VATICAN CITY (AP) — Pope Benedict XVI granted his former butler a Christmas pardon Saturday, forgiving him in person during a jailhouse meeting for stealing and leaking his private papers in one of the gravest Vatican security breaches in recent times.
After the 15-minute meeting, Paolo Gabriele was freed and returned to his Vatican City apartment where he lives with his wife and three children. The Vatican said he couldn't continue living or working in the Vatican, but said it would find him housing and a job elsewhere soon.
"This is a paternal gesture toward someone with whom the pope for many years shared daily life," according to a statement from the Vatican secretariat of state.
The pardon closes a painful and embarrassing chapter for the Vatican, capping a sensational, Hollywood-like scandal that exposed power struggles, intrigue and allegations of corruption and homosexual liaisons in the highest levels of the Catholic Church.
Gabriele, 46, was arrested May 23 after Vatican police found what they called an "enormous" stash of papal documents in his Vatican City apartment. He was convicted of aggravated theft by a Vatican tribunal on Oct. 6 and has been serving his 18-month sentence in the Vatican police barracks.
He told Vatican investigators he gave the documents to Italian journalist Gianluigi Nuzzi because he thought the 85-year-old pope wasn't being informed of the "evil and corruption" in the Vatican and thought that exposing it publicly would put the church back on the right track.
During the trial, Gabriele testified that he loved the pope "as a son loves his father" and said he never meant to hurt the pontiff or the church. A photograph taken during the meeting Saturday — the first between Benedict and his once trusted butler since his arrest — showed Gabriele dressed in his typical dark gray suit, smiling.
The publication of the leaked documents, first on Italian television then in Nuzzi's book "His Holiness: Pope Benedict XVI's Secret Papers" convulsed the Vatican all year, a devastating betrayal of the pope from within his papal family that exposed the unseemly side of the Catholic Church's governance.
The papal pardon had been widely expected before Christmas, and the jailhouse meeting Benedict used to personally deliver it recalled the image of Pope John Paul II visiting Mehmet Ali Agca, the Turkish gunman who shot him in 1981, while he served his sentence in an Italian prison.
The Vatican spokesman, the Rev. Federico Lombardi, said the meeting was "intense" and "personal" and said that during it Benedict "communicated to him in person that he had accepted his request for pardon, commuting his sentence."
Lombardi said the Vatican hoped the Benedict's pardon and Gabriele's freedom would allow the Holy See to return to work "in an atmosphere of serenity."
None of the leaked documents threatened the papacy. Most were of interest only to Italians, as they concerned relations between Italy and the Vatican and a few local scandals and personalities. Their main aim appeared to be to discredit Benedict's trusted No. 2, the secretary of state, Cardinal Tarcisio Bertone.
Vatican officials have said the theft, though, shattered the confidentiality that typically governs correspondence with the pope. Cardinals, bishops and everyday laymen write to him about spiritual and practical matters assuming that their words will be treated with the discretion for which the Holy See is known.
As a result, the leaks prompted a remarkable reaction, with the pope naming a commission of three cardinals to investigate alongside Vatican prosecutors. Italian news reports have said new security measures and personnel checks have been put in place to prevent a repeat offense.
Gabriele insisted he acted alone, with no accomplices, but it remains an open question whether any other heads will roll. Technically the criminal investigation remains open, and few in the Vatican believe Gabriele could have construed such a plot without at least the endorsement if not the outright help of others. But Lombardi said he had no new information to release about any new investigative leads, saying the pardon "closed a sad and painful chapter" for the Holy See.
Nuzzi, who has supported Gabriele as a hero for having exposed corruption in the Vatican, tweeted Saturday that it appeared the butler was thrilled to speak with the pope and go home. "Unending joy for him, but the problems of the curia and power remain," he wrote, referring to the Vatican bureaucracy.
A Vatican computer expert, Claudio Sciarpelletti, was convicted Nov. 10 of aiding and abetting Gabriele by changing his testimony to Vatican investigators about the origins of an envelope with Gabriele's name on it that was found in his desk. His two-month sentence was suspended. Lombardi said a pardon was expected for him as well. He recently returned to work in the Vatican.
Benedict met this past week with the cardinals who investigated the origins of the leaks, but it wasn't known if they provided him with any further updates or were merely meeting ahead of the expected pardon for Gabriele.
As supreme executive, legislator and judge in Vatican City, the pope had the power to pardon Gabriele at any time. The only question was when.

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