Barnes & Noble releases new Nook e-reader for $119

NEW YORK — Barnes & Noble Inc. is releasing a new Nook e-book reader for the holidays, while it evaluates the future of tablet computers.

Nook tablets haven't sold well amid intense competition with Apple's iPad, Amazon's Kindle Fire and others. Barnes & Noble had a slim 2 percent share of the worldwide tablet market in the fourth quarter of 2012, but fell off IDC's top 5 list this year.

The company said it isn't giving up on tablets, but it will focus on a new e-reader this year while continuing to sell last year's tablet models. The move comes as research firm IDC says the market for dedicated electronic-book readers is declining. Instead, consumers have been more interested in tablets, which can do much more, including video, email, Facebook and games.

Barnes & Noble's new e-reader, Nook GlowLight, is available in its retail stores and online starting Wednesday for $119, the same as the standard model of Amazon.com Inc.'s Kindle Paperwhite reader. At 6.2 ounces, the GlowLight is 15 percent lighter than the Paperwhite. It's also ad-free, while Amazon charges $20 more for a Paperwhite without ads on its screensaver or home screen.

Barnes & Noble officials say the new e-reader's design is based partly on feedback received at the company's retail stores, where Nook devices are prominently displayed. Consumers' suggestions led to a brighter screen on the brightest setting and more durability in the form of a rubber-like silicone edge, which also provides comfort in the hands. In addition, the frame is white, not black, to match the screen color.

Jonathan Shar, general manager for emerging digital content at Barnes & Noble, said that even as attention has turned to tablets, e-readers are still popular for long-form reading. The GlowLight has an electronic ink touch screen, which has better battery life and less glare than typical tablet screens.

Unlike Kindles, which are tied to Amazon's bookstore, Nook devices are compatible with books bought at other stores that use the EPub standard, including Apple's iBookstore.

The new Nook device replaces the $99 Nook Simple Touch GlowLight model from last year. Barnes & Noble will still sell the $79 Simple Touch e-reader, without the built-in reading light, and Nook HD tablets with screens measuring 7 and 9 inches diagonally. The smaller tablet starts at $129 and the larger one at $149.

Nook's future had come into question after Barnes & Noble said in June that it would stop making its own Nook color touch-screen tablets and would farm out manufacturing to a third-party.

But its CEO left a few weeks later, and the company said instead it was reviewing its Nook strategy. Michael Huseby, the head of the company's Nook business, said in August that the 4-year-old Nook business has had some success, with 10 million devices sold and a 22 percent share in the e-book market. But he acknowledged the company had been overly optimistic about demand.

In an interview this week, Mahesh Veerina, chief operating officer for the company's Nook Media business, said Barnes & Noble will be looking to make devices that enhance the reading experience, as opposed to building an all-purpose device.

"We are evaluating our road map and product plan," he said. "We don't want to play in this general tablet market and compete with everybody."

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Infosys to settle US visa fraud case for $34M

PLANO, Texas — Federal authorities say the $34 million settlement it reached with Indian technology outsourcing giant Infosys fixes "systemic issues" targeted in a major visa fraud and immigration abuse case.

Infosys said Wednesday that it agreed to settle the case following a two-year federal investigation.

Infosys had been under investigation for using short-term B-1 visas to bring thousands of workers to the United States instead of the more expensive, long-term H1-B visa. An Infosys consultant flagged what he said was an illegal practice and later filed a whistleblower lawsuit against the company, which was dismissed.

John M. Bales, the U.S. attorney for Texas' eastern district, said the settlement will require Infosys to change its visa practices.

Infosys said in a statement that it denies "any claims of systemic visa fraud."

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GM 3Q earnings fall, but beat Street forecasts

DETROIT — General Motors' third-quarter net income fell 53 percent compared with a year ago, as one-time expenses masked a strong performance in North America and a narrowed loss in Europe.

The company earned $698 million in the quarter, or 45 cents per share. That compares with $1.48 billion, or 89 cents per share, a year ago. But without $900 million in one-time items, GM earned $1.7 billion, or 96 cents per share. That beat Wall Street's expectations. Analysts polled by FactSet expected 94 cents per share.

Revenue rose 4 percent to $39 billion, just short of Wall Street's estimate of $39.2 billion.

Investors viewed the results favorably. GM shares rose 87 cents, or 2.4 percent, to $36.93 in morning trading.

GM's performance in North America was especially strong, with pretax earnings up 28 percent to $2.2 billion on solid pickup truck sales and better pricing. GM rolled out updated versions of its Chevrolet Silverado and GMC Sierra pickups in the spring.

The company's profit margin in North America — the percentage of revenue it gets to keep after expenses — was the highest in two years at 9.3 percent. GM has a goal of 10 percent pretax margins in the region.

"The new trucks are doing great in the marketplace," Chief Financial Officer Dan Ammann said. "We're commanding good pricing. We're controlling costs."

GM's average sales price rose 1 percent in the U.S. during the quarter to $34,566, according to Kelley Blue Book. Sales of the Silverado, its top-selling vehicle, were up 14 percent over last year's third quarter. Prices for the pickup rose by 2 percent to an average of $36,487.

In Europe, GM cut its loss by more than half to $214 million. Revenue there rose year-over-year for the first time in two years. Ammann said the company cut $400 million in costs during the quarter, and updated versions of its Opel Mokka small crossover SUV, Adam subcompact and Insignia midsize car sold well.

GM's International Operations, including Asia, saw pretax earnings fall 61 percent to $299 million due to struggles in India, Australia and Southeast Asia. The unit would have lost more than $100 million without $400 million in earnings from China.

"We continue to have challenges in some markets," Ammann said. Some are due to industrywide issues such as competitors lowering prices, but some are execution problems on GM's part, he said.

South American profit rose 79 percent to $284 million. The company's financial unit saw a 20 percent rise in pretax earnings to $239 million.

One-time items included $800 million to buy preferred stock from a health care trust for union retirees and a $48 million impairment charge in South Korea.

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Mass. hospital to post loss, warns of layoffs

WORCESTER, Mass. — UMass Memorial Health Care is expected to post a $57 million operating loss in its last fiscal year, likely resulting in future layoffs and other cost-cutting measures for the hospital system.

The Telegram of Worcester reports (http://bit.ly/1adEHwb ) that officials sent a memo to employees saying the operating loss for the 12-month period ending Sept. 30 would be the first for the nonprofit hospital system in eight years.

Hospital spokesman Robert Brogna says rising costs and reduced inpatient volume are contributing to the losses. He did say UMass Memorial Health Care would be able to post a $75 million surplus for the fiscal year thanks to investment income and one-time revenue from the sale of two units.

There was no immediate word on how many layoffs might be needed.

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Smartwatches abound. But who really wants one?

NEW YORK — Smartwatches that display message alerts and weather updates are popping up everywhere this holiday season as consumer electronics companies try to persuade you to add them to your shopping list.

But is there really a big demand for computerized wristwatches?

Samsung and Sony have devices out, and Qualcomm has one coming before the holidays. Apple is believed to be making one, and a new report says Google is developing one, too.

The big push for smartwatches isn't coming from consumers, says Jonathan Gaw, a research manager at IDC. Rather, it's a product in search of a market — and an expensive one at that.

"We've had smartwatches for a while, and while the capabilities and technology have gotten better, this is still not something that people are clamoring for," Gaw says. "The idea that it would ramp up for the holidays was always kind of a stretch."

That hasn't stopped gadget makers from trying. Companies are under pressure to create a new source of buzz now that consumers are no longer wowed by the latest smartphones and tablet computers. Many people already have those devices, and the new ones out this year are evolutionary rather than revolutionary.

Gaw says many gadget makers see an opportunity to jump in with a smartwatch, before a behemoth like Apple is able get its rumored iWatch ready.

Last month, Samsung Electronics Co. started selling the $300 Galaxy Gear in the U.S. It works with selected Samsung smartphones to display email and text alerts. There's a camera on the strap for low-resolution photos and a speakerphone on the watch to make calls while leaving your phone in the pocket. You can install apps for additional functionality, such as tracking fitness activities and playing games, though there are only a handful of apps available for now.

Sony Corp.'s SmartWatch 2 is cheaper, at $200. Unlike the Gear, it works with a variety of Android phones, not just Sony's. But it doesn't let you make phone calls directly through the wristwatch. You can answer calls using the watch, but you need a Bluetooth wireless headset linked to the phone if you don't want to hold it to your ear.

Qualcomm Inc., meanwhile, plans to start selling Toq before the holidays. It, too, will work with several Android devices.

Another smartwatch getting attention is the Pebble, which comes from a startup that raised more than $10 million through the fundraising site Kickstarter. It notifies you of incoming calls, texts and emails.

Apple isn't likely to release its iWatch before next year, given that no mention was made of it at the company's product showcase last week.

As for Google, The Wall Street Journal cited unnamed people familiar with the matter on Tuesday in reporting that the Internet search company is in late-stage development on a smartwatch which could be ready for mass production within months.

Samsung and Sony executives say they've designed their watches to give people ready access to information they would normally check on their phones, reducing the need to constantly pull out the phones.

Only Qualcomm seems to be acknowledging that there's no real consumer demand for smartwatches yet. The company says it's trying to showcase what's possible, so other manufacturers will take the concept and build better products — using Qualcomm's display technology and other components.

In a September briefing with The Associated Press, Samsung executives said the company has a history of taking risks. Samsung notes that people were skeptical about its Note phones with big screens, too, but now several other manufacturers are making Android phones with bigger screens.

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Comcast 3Q profit declines, still beats Street

PHILADELPHIA — Comcast Corp., the nation's largest TV and Internet provider, on Tuesday posted a drop in third-quarter earnings that was milder than expected. Its NBCUniversal media subsidiary overcame the loss of Olympics programming with better movies like "Despicable Me 2" as well as upbeat theme park revenue.

On the pay TV side, 876,000 more consumers than a year ago opted for high-definition and digital video recorder service, which costs $15.95 a month per set-top box in certain regions like its home base of Philadelphia. That, combined with a price hike and customers adding channels, helped video revenue rise, more than making up for the loss of 355,000 video subscribers over the last 12 months.

Comcast ended the quarter with 21.6 million video customers. It added 1.3 million Internet customers compared with a year ago to finish with 20.3 million.

Net income fell 18 percent to $1.73 billion, or 65 cents per share. A year ago, the company benefited from the sale of wireless spectrum and its stake in pay TV network operator A&E. This year, one-time items canceled each other out. The 65 cents per share profit beat the 60 cents expected by analysts polled by FactSet.

Revenue dropped 2 percent to $16.15 billion, short of the $16.25 billion analysts expected. Excluding the $1.19 billion in Olympics ad sales last year, revenue would have grown 5 percent.

Comcast shares fell 65 cents, or 1.4 percent, to $47.06 in morning trading. They are still up almost 28 percent since the start of the year.

Comcast continues to reap the benefits of its takeover of entertainment company NBCUniversal, which it began by taking a 51 percent stake for $13.5 billion in January 2011. It bought out minority owner GE for another $16.7 billion in March, five years ahead of schedule.

While NBCU revenue fell 14 percent to $5.85 billion, excluding the Olympics, it would have grown 4 percent.

Movie profits were helped because of the success of "Despicable Me 2," which has grossed more than $900 million in ticket sales worldwide since coming out in July. The opening of the "Transformers 3-D" ride at the Universal Orlando Resort in Florida this summer boosted attendance and spending.

Revenue from TV, Internet and voice hookups rose 5 percent to $10.49 billion.

The average revenue for every video customer per month rose 7 percent to $161.07 a month from $150.73 a year ago.

The company lost video customers in the face of rising competition from telecoms operators AT&T and Verizon, which now compete to serve about 44 percent of the 53.7 million homes and businesses that are in Comcast's service area.

That's up from 41 percent a year ago as AT&T continues to expand its footprint.

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US consumer prices rise just 0.2 pct. in September

WASHINGTON — U.S. consumer prices increased only slightly in September, as higher energy costs offset flat food prices. The figures are the latest evidence that slow economic growth is keeping inflation tame.

The consumer price index rose a seasonally adjusted 0.2 percent in September, the Labor Department said Wednesday. That's up from 0.1 percent in August. Higher gas, electricity and other energy costs rose 0.8 percent, making up about half the overall increase.

In the past year, consumer prices have increased just 1.2 percent, down from a 1.5 percent annual gain in August. That's the smallest 12-month gain since April, and it's below the Federal Reserve's 2 percent inflation target.

Excluding volatile food and energy costs, core prices rose just 0.1 percent and are up 1.7 percent in the past 12 months.

High unemployment and meager wage increases have made it difficult for Americans to pay more for most goods. That has also made it hard for retailers to charge more.

With inflation below the Fed's target, the central bank faces less pressure to scale back its $85 billion-a-month in bond purchases. The bond purchases are intended to keep long-term inflation rates low and stimulate economic growth. But critics fear it raises the risk of higher inflation.

Extremely low inflation may even increase pressure on the Fed to extend the purchases. Some Fed officials have objected to slowing the bond-buying program when inflation is well below 2 percent. A small amount of inflation can be good for the economy because it encourages consumers and businesses to spend and invest before prices rise further.

Fed policymakers will conclude a two-day meeting Wednesday. Economists expect the Fed won't make any changes to its current policies, which include keeping a key short-term interest rate near zero.

Paul Dales, an economist at Capital Economics, says price gains have picked up in the past few months, a sign "the Fed needn't worry too much about low inflation."

Prices for clothing and hotels fell, while airline fares, new car prices, and rents rose. Fruit and vegetable prices dropped, offsetting increases in meat, breads and dairy products.

September's report also includes data used by the Social Security Administration to calculate cost-of-living adjustments for 58 million Social Security beneficiaries. Mild inflation means benefits will increase 1.5 percent next year, among the smallest increases since the automatic adjustments began in 1975.

The consumer price figures were originally scheduled to be released Oct. 16. But they were delayed by the 16-day partial government shutdown.

The shutdown has likely slowed growth in an already weak economy. Economists expect economic growth at an annual rate of between 1.5 percent and 2 percent from July through September. That would be down from a 2.5 percent annual rate in the April-June quarter.

And economists expect little pickup in the October-December quarter. The shutdown likely cut a quarter- to a half-percentage point from growth in the final three months of the year.

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Gov't document: Health site posed security risk

WASHINGTON — An internal government memo obtained by The Associated Press shows administration officials were concerned that a lack of testing posed a "high" security risk for President Barack Obama's new health insurance website.

The Sept. 27 memo to Medicare chief Marylin Tavenner said a website contractor wasn't able to test all the security controls in one complete version of the system.

Insufficient testing "exposed a level of uncertainty that can be deemed as a high risk," the memo said.

The memo recommended setting up a security team to address risks, conduct daily tests, and a full security test within two to three months of going live.

At a congressional hearing, Health and Human Services Secretary Kathleen Sebelius said the site's security certification is temporary, but asserted consumers' personal information is secure.

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Health site security concerns raised in memo

WASHINGTON — Defending President Barack Obama's much-maligned health care law in Congress, Health and Human Services Secretary Kathleen Sebelius was confronted Wednesday with a government memo that raised security concerns about the website consumers are using to enroll.

The document, obtained by The Associated Press, shows that administration officials at the Centers for Medicare and Medicaid Services were concerned that a lack of testing posed a potentially "high" security risk for the HealthCare.gov website serving 36 states.

Security issues are a new concern for the troubled HealthCare.gov website. If they cannot be resolved, they could prove to be more serious than the long list of technical problems the administration is trying to address.

"You accepted a risk on behalf of every user that put their personal financial information at risk," Rep. Mike Rogers, R-Mich., told Sebelius during questioning before the powerful House Energy and Commerce Committee.

Sebelius countered that the system is secure, although the site has a temporary security certificate, known in government parlance as an "authority to operate." Sebelius said a permanent certificate will only be issued once all security issues are addressed.

Earlier, the secretary said she's responsible for the "debacle" of cascading problems that overwhelmed the government website intended to make shopping for health insurance clear and simple.

"Hold me accountable for the debacle," Sebelius said during a contentious hearing before the powerful House Energy and Commerce Committee. "I'm responsible."

Sebelius is promising to have the problems fixed by Nov. 30, even as Republicans opposed to Obama's health care law are calling in chorus for her resignation. She told the committee that the technical issues that led to frozen screens and error messages are being cleared up on a daily basis.

Addressing consumers, Sebelius added, "So let me say directly to these Americans, you deserve better. I apologize."

But even as she started her testimony, some consumers trying to log into the federal website that serves 36 states were getting this message: "The system is down at the moment. We are experiencing technical difficulties and hope to have them resolved soon. Please try again later."

The Sept. 27 memo to Medicare chief Marylin Tavenner said a website contractor wasn't able to test all the security controls in one complete version of the system.

"From a security perspective, the aspects of the system that were not tested due to the ongoing development, exposed a level of uncertainty that can be deemed as a high risk for the (website)," the memo said.

It recommended setting up a security team to address risks, conduct daily tests, and a full security test within two to three months of going live.

HealthCare.gov was intended to be the online gateway to coverage for millions of uninsured Americans, as well those who purchase their policies individually. Many people in the latter group will have to get new insurance next year, because their policies do not meet the standards of the new law.

Sebelius' forthright statement about her ultimate accountability came as she was being peppered with questions by Rep. Marsha Blackburn, R-Tenn., about who was responsible. It was Blackburn who introduced the term "debacle."

Rep. Henry Waxman of California, the ranking Democrat on the committee, scoffed at Republican "oversight" of a law they have repeatedly tried to repeal.

"I would urge my colleagues to stop hyperventilating," said Waxman. "The problems with HealthCare.gov are unfortunate and we should investigate them, but they will be fixed. And then every American will have -- finally have access to affordable health insurance."

Sebelius entered a hearing room so packed with lawmakers, photographers and others that she had trouble finding a path to her seat after shaking hands with the committee members.

Many in the crowd chuckled at her quandary, which was far easier to negotiate than the questions that awaited her about the messy launch of Obama's health care web site. The crowd parted, and she found her way to her seat at the witness table, facing a wall of expectant lawmakers.

The standing-room-only hearing room was silent when she swore an oath to tell the truth and began her statement. "I apologize," she told the rapt committee.

Sebelius faced questions about problems with the website as well as a wave of cancellation notices hitting individuals and small businesses who buy their own insurance.

Lawmakers also want to know how many people have enrolled in plans through the health exchanges, a number the Obama administration has so far refused to divulge, instead promising to release it in mid-November.

Some committee members expressed doubts about whether consumers' personal information is safe on such a balky website.

On Tuesday, Medicare chief Marilyn Tavenner was questioned for nearly three hours by members of the House Ways and Means Committee who wanted to know why so many of their constituents were getting cancellation notices from their insurance companies.

The cancellations problem goes to one of Obama's earliest promises about the health law: You can keep your plan if you like it. The promise dates back to June 2009, when Congress was starting to grapple with overhauling the health care system to cover uninsured Americans.

As early as last spring, state insurance commissioners started giving insurers the option of canceling existing individual plans for 2014, because the coverage required under Obama's law is significantly more robust. Some states directed insurers to issue cancellations. Large employer plans that cover most workers and their families are unlikely to be affected.

The law includes a complicated "grandfathering" system to try to make good on Obama's pledge. It shields plans from the law's requirements provided the plans themselves change very little. Insurers say it has proven impractical. The cancellation notices are now reaching policyholders.

Tavenner blamed insurance companies for cancelling the policies and said most people who lose coverage will be able to find better replacement plans in the health insurance exchanges, in some cases for less money. Change is a constant in the individual insurance market, she added, saying that about half of plans "churn" over in any given year.

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Surgical Care Affiliates climbs after $235M IPO

NEW YORK — Shares of Surgical Care Affiliates are rising after the outpatient surgical center operator's initial public offering raised a total of $234.7 million.

The company's IPO of 9.8 million shares priced at $24 per share, at the high end of its estimates. The stock rose $3.60, or 15 percent, to $27.60 Wednesday morning.

Surgical Care Affiliates Inc. is selling 7.9 million shares for $188.6 million in gross proceeds. The remaining shares are being sold by company shareholders.

The underwriters of the IPO will have the option to buy another 1.5 million shares from those shareholders.

Surgical Care Affiliates is based in Deerfield, Ill. It runs the third-largest network of outpatient surgery centers in the U.S. Its shares are trading on the Nasdaq Global Select Market under the ticker symbol "SCAI."

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