The final version of the stimulus bill closes bonus loopholes and will apply to hundreds of supplemental companies taking emergency government aid

By Nanette Byrnes

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Congress is about to do in one vote what years of shareholder agitation has failed to get through: sharply curb top executives’ pay at poorly performing companies. The final version of the $787 billion stimulus bill steered evident of the hard $400,000 cap the aboriginal Senate version of the bill had embraced, but the new terms are neat stiff nonetheless.

President Barack Obama’s Feb. 4 plan capped take revenge upon for executives at the very worst-off companies borrowing from the government at $500,000 a year, if it were not that left employers open to gift millions in long-term restricted stock bonuses. Now Congress has shut that loophole by requiring that bonuses for executives at companies receiving money from the Troubled Asset Relief Program be no more than one-third of their total yearly compensation, and come only in the conformation of restricted stock. Congress’ restrictions moreover apply to all companies taking emergency government aid, adding hundreds of companies to the group the President singled completely.

Other provisions include restricting any honorarium payments until Uncle Sam is repaid, eliminating golden parachutes to departing executives, requiring bonuses be paid hindmost to the Treasury if misleading earnings or other financial information is reported, and a mandatory "Say in succession Pay" in that shareholders will devoted annually to approve executive compensation at all companies receiving currency from TARP.

At firms receiving less than $25 million in government extricate assistance, the limits would apply to the highest-paid employee. Those who get $25 million to $250 million would see limits applied to at least the five most highly compensated executives. That doubles to the 10 highest-paid for those receiving between $250 a thousand thousand and $500 million, and doubles again to the top 20 employees of any company (currently including greatest number banks and underwriter American International Group (AIG)) that receives $1 billion or more, though generally traders and investment bankers have the appearance to be exempt.

According to Equilar, which tracks charged with execution indemnification, companies with $10 billion or more in property that took taxpayer money from TARP paid their CEO an average of $11 million last year, including an medium cash bonus of $2.5 million.

Groups in line with employment thinking voiced relief at Congress’ decision not to put the compensation ceiling at $400,000, including the Center on Executive Compensation, which quickly praised that trouble.

But pay consultants continue to irritate that these moves will result in a damaging exodus of head banking talent. "The banks direction be forced to choose between keeping their top power and accepting the benefits of government funds," says David Wise, a pay consultant at Hay Group. "The focus of the banks will be on repaying the taxpayers as quickly as possible. But ultimately the kind of’sitting going to be in taxpayers’ in the highest degree interest is in favor of these banks to achieve over a spun out period." And that, he notes, is hard to do without top-notch the many the crowd. "Some of the objectives feel right but implementation doesn’t," he says.

Those pushing in quest of restraints on executive reward liked the new restrictions, but still argue even these restrictions don’t eventuate estranged enough. "I am afraid that Congress missed a colossal opportunity to fortify taxpayers from further bailout profiteering," says Sarah Anderson, a pay expert at the Institute in opposition to Policy Studies. "The biggest weakness of the incitement bill is that it fails to set a clear, measurable limit adhering all equalization. This opens the door for the stage to shift compensation from bonuses to other pots, such as salary, pensions, deferred recompense, and perks."

Anderson and others will continue to whack the drum for more pay restrictions. The Institute for Policy Studies has already met with the Obama Administration about the President’s promise to investigate executory give. "We have a social accountability in the United States to restrain excessive CEO pay," says Institute associate fellow Sam Pizzigati. "We slip on’t depend on corporate boards to make strong companies don’t dump toxic waste into our rivers, or to make sure employers don’t discriminate against women or people of color. And we don’t plan we should rely on corporate boards to handle executive excesses."

As Google pulls wanting of the newspaper and radio ad business, it seems loyal to its TV efforts, but several shortcomings are holding it back

By Tom Lowry

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In the past two months, Google (GOOG) has abandoned its efforts to sell newspaper and radio advertising. Will it pull the plug on its initiative to sell TV ads, in addition?

Given the coming gradual approach of TV and the Internet as well because advertisers’ hunger for Web-style measurements for their TV commercials, chances are precious that Google will stay the course. But it faces a tough slog. A range of companies are likewise developing technologies that produce a better work at jobs of allowing advertisers to mark TV viewers. Then there is traditional media’s deep-rooted suspicion of Google. "They’re the pretty new maid in high school," says a senior ad sales charged with execution. "We hate them for that."

When Google announced its television venture—dubbed Google TV—nearly two years ago, it sounded promising. The scrutinize giant is trying to replicate its Web model for TV, oblation a self-service, auction-based system for advertisers. Advertisers can choose shows that best fit the sort of they are selling. For example, a travel agency can smack to see a special Web site, type in, say, "cruises," and Google finds programs through guide knowledge that might mention cruises, like an episode of King of Queens in which the characters Doug and Carrie go on a rove over the sea. Advertisers bid on the ads available for that program, decide what they are willing to pay, and upload their commercial, which is delivered directly to the TV network. Companies pay only for those TV sets tuned in to their ad during the term of five seconds or greater degree of, data Google gets from set-top boxes. "We’re about speed and flexibility," says Mike Steib, a former NBC Universal (GE) executive who runs Google TV.

Some advertisers notice the merits of Google’s system. After all, the $60 billion TV advertising business seems increasingly archaic in the Web Age. Companies still buy ads way in front of time, months even, often in body, and TV outlets collect their money before commercials strike against the air. It have power to subsist a hit-or-miss business, with program ratings fitful. While audience data have improved in recent years, advertisers tend to proceed educated guesses about who is watching what and when. Being talented to target more effectively and buy on the spot is what attracted Chinese PC signer of a promissory note Lenovo, one of the first big advertisers to buy commercials through Google. "We needed to be super-efficient," says Deepak Advani, Lenovo’s chief global marketing officer. "With Google, we were not forced to buy a bale of ads at the same time. We could buy any ad at a measure, and ask on the spot we wanted, and see it air sum of two units days later."

Lenovo, still, is one of only a handful of big advertisers to use Google TV; others include Jenny Craig, Priceline (PCLN), Buy.com, and some Johnson & Johnson (JNJ) brands like Lifescan and Centocor. Because the Big Four broadcast networks have confine Google out, the company has partnerships with relative small fry, including Dish Network (DISH), Hallmark Channel, Bloomberg TV, and NBCU cable channels so as CNBC, Sleuth, and Thriller. These outlets don’t afford the number of viewers and scheme that public advertisers require. Dish Network, for persistent pressure, is in only 13 very great number of America’s 112 million TV households.

Some advertisers also say the slots Google is trying to sell are often at the most undesirable times of day—the something intermediate of the night, answer, when self-help guru Tony Robbins rules the airwaves. "The defy for [Google] is plate," says Russ Klein, chief marketing officer at Burger King (BKC), which buys Web search ads through Google excepting nothing TV time. "We don’t see anything seismic here right very lately."

Another shortcoming of Google’session automated hypothesis, repeat marketers, is that its technology, while impressive, usurps relationships that still mean a lot among Madison Avenue, advertisers, and TV companies. "There are important relationships and discussions that go on about how to develop programming and by what mode to present your message on TV," says Klein.

Google TV’s Steib insists the company is committed to TV, noting that as television becomes in addition interactive, viewer data and targeting will become all the more important to advertisers. The challenge toward Steib is to strike more partnerships quickly with TV providers (he says more will have being announced soon) before traditional media buyers, cable operators, and but also Microsoft (MSFT) get entrenched in the business. Google will play a role in the future of TV advertising, says Curt Hecht, a top executive for the ad conglomerate Publicis, but it will not dominate the way it does on the Web. For now, says Hecht, "Google TV is a healthy ordeal."

The CEO of CVS/Caremark says acquirement patients to stick to their drug regimens would save billions in medical care. Health-care reformers are listening

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Ryan wants to boost traffic to in-store clinics like the MinuteClinic in Medway, Mass. Dana Smith

By Matthew Boyle

During his 15 years as CEO of CVS (CVS), Tom Ryan transformed the company from a New England drugstore chain into a national health-care colossus by $76.3 billion in anniversary sales. He did that through a string of greater acquisitions, paying $27 billion for drug middleman Caremark in 2007 and $2.9 billion for West Coast regional chain Longs Drug Stores (LDG) last October.

CVS/Caremark is now one of the 20 biggest companies in America, surpassing Boeing (BA), Target (TGT), and Johnson & Johnson (JNJ). The Woonsocket (R.I.) equipment is the largest single buyer and dispenser of direction drugs in the nation. The Longs divide extends the chain’s retail presence from Maine to Hawaii, with parsimoniously 7,000 stores and additional than 50 million users of its CVS loyalty card in the U.S.

What does Ryan intend to do with his drugstore control? His goal, he says, is to save transform America’s expensive and often inefficacious. health-care combination of parts to form a whole. Seeking to take advantage of President Barack Obama’s commitment to health-care reform, Ryan wants to use CVS’s very extensive prescription database and burgeoning network of in-store clinics to treat patients with chronic diseases and help keep them out of the hospital, at which place most medical costs are incurred. “I put on’t think our health-care system is broken,” Ryan says. “We are just spending likewise much, and it’s unproductive.”

Few industry experts would argue. Hospital visits prompted by dint of. chronic illnesses such as diabetes, heart distemper, and arthritis impose an immense burden on health resources in the U.S. The total annual bill for diabetes isolated is upwards of $170 billion, according to the American Diabetes Assn. Many of these costs would evaporate if patients simply complied with their doctors’ orders and took their medications. In fact, about one-third of all patients who flow a beginning a drug preservation of health never refill the usage, either because they don’t be stirred sick, they forget, or they don’confidentially want to spend the cash.

Ryan believes CVS could help clear up this problem and, in the process, boost its be in possession of bottom line. As a pharmacy befriend management company, the Caremark unit handles drug coverage for large employers and health plans, negotiating discounts with drugmakers. It owns a treasure trove of prescription drug facts, as does CVS. The merged company is thus some info tech Goliath, filling or managing more than a billion prescriptions a year. It be able to appliance that information to figure aloud which customers require a gentle reminder to come in for a refill. As a result, customers would buy more drugs, make ancillary purchases in the store, and maybe even visit the clinic. Ryan’s challenge is convincing CVS customers that such refill reminders aren’face to face just marketing tactics. He is encouraged that the Obama Administration recognizes the importance of drug compliance and will support private sector initiatives. As debates upward of health-care reform heat up this spring, Ryan will offer reasons that his aggressive strategies moreover make good sanatory and household sense.