This week in Advertising Age:

A freebie tool, TrialPay, is a new web tool created to serve the desires of customers to get free stuff, and companies wishing to push its product by giving away freebies. For example, if while browsing a participating retail site you found an MP4 player you'd like, but don't want to pay for, you can select Checkout by TrialPay, which might respond with an offer from an online music sales site offering to buy the MP4 for you if you buy X number of songs from them. You end up paying, for sure, but you might save a few bucks along the way.

Viral marketing, creating web content appealing enough that it inspires peer to peer recommendations, is a hot segment of web marketing. AA lists the 10 most prolific viral marketers, according to Competitrack -- Nike (NYSE: NKE), Anheuser-Busch (NYSE: BUD), Microsoft (NASDAQ: MSFT), Volkswagen, Axe, Apple (NASDAQ: AAPL), Coca-Cola (NYSE: KO), Adidas, PepsiCo (NYSE: PEP) and McDonald's (NYSE: MCD). Getting ready to move? Be prepared for an onslaught of pitches. AA finds that pre-movers are also big spenders, fixing up their houses, buying new furniture and appliances, and so on.

Topps Meat, whose frozen burgers have been a staple at backyard cookouts for generations, is closing its doors following a massive recall. Meanwhile, Wal-Mart Stores Inc.'s (NYSE: WMT) Sam's Club chain pulled a brand of beef patties from its shelves four children reportedly got sick.

This is unbelievable. The federal government has got to do a better job of ensuring the safety of our food supply. The Topps Meat recall is particularly disturbing since the meet in question was made in LATE JUNE AND JULY. Why did the 21.7 million pound recall -- which ABC news estimates is enough meet to make a McDonald's (NYSE: MCD) regular hamburger for every U.S. adult -- take so long? It was the second-largest beef recall in U.S. history, according to the Associated Press. To make matters worse, government officials say they don't know the "source of the E. coli contamination that appears to have sickened 32 people who ate its hamburgers," the AP said.

Though I don't expect the ranks of vegans to swell because of this massive recall, it may push more people to buy organic beef, which should help the likes of Whole Foods Markets Inc. (NYSE: WFMI) and Trader Joe's. Wal-Mart and big supermarket chains such as Albertsons may be encouraged to buy more meat from organic producers, such as Laura's Lean Beef, which don't use antibiotics or growth hormones.

Something has to be done or these recalls will continue.

I had the pleasure of writing a series this spring on the Top 25 Stocks for the NEXT 25 years. I researched over 300 companies to come up with the list of what I thought were the best 25 stocks to own for the next 25 years. But something was missing that I now want to address in a new series.

The very nature of picking 25 stocks which hopefully would perform magnificently for 25 years excluded many great companies that were already executing well but could not be included because of their high current market capitalization. Some examples were "game changing" companies like Apple (NASDAQ: AAPL). Back in May, Apple had a market capitalization of about $90 billion. But I couldn't include it in my top 25 unless I expected Apple's market cap to reach several trillion dollars. I love Apple, but that's probably not in the cards. By the way, Apple today is worth $130 billion.

Another example of a game-changing company is McDonald's (NYSE: MCD). This once staid, stuck-in-the-mayonnaise company has re-invigorated itself in the past couple of years and has seen its market value more than double to $66 billion. I'd also throw in that camp Caterpillar (NYSE: CAT), which since January 2004 has seen its own market capitalization double to $51 billion. Caterpillar changed and fortified its business model starting back in late 2003. By the way, Apple,Caterpillar and McDonald's are still game changers---meaning the shares are a buy.

Doug McIntyre noted earlier this week that McDonald's Corp. (NYSE: MCD) is upgrading its coffee selection to include lattes, cappuccinos and other specialty drinks. It looks like the golden arches is trying to steal some market share from the green goddess of Starbucks (NYSE: SBUX). Mickey D's says that the new coffee drinks could bring in over $1 billion in sales. Put that in your cup and drink it!

The expanded coffee selection raises the question of whether this is part of a larger shift in McDonald's strategy and brand positioning. Zac Bissonnette noted a few weeks ago that McDonald's stores in Europe are going upscale, with leather seats, soft lighting and real silverware. Zac scoffed at the idea of high-end McDonald's here in the U.S., and it is hard to imagine why anyone could want to spend quality time in a restaurant saturated with the smell of McGriddles and fries, no matter how nice the lighting or shiny the spoons. It's also worth wondering whether the average McDonald's employee will be willing and able to make a good cappuccino. (It isn't that McDonald's employees are incompetent, but rather that the company likes to keep training to an absolute minimum and is loathe to provide any real skills lest the employees demand higher pay.)

Citigroup (NYSE: C) said it would buy out minority shareholders in scandal-hit Japanese brokerage Nikko Cordial Corp for $4.6 billion, as part of its push into the world's second-largest economy. Citigroup spent about $8 billion to buy a 68% stake in Japan's third-largest securities firm earlier this year and would offer its own shares to buy the remaining 32% it does not own.

According to BetaNews, Microsoft (NASDAQ: MSFT) will hold a event today in Redmond to launch the second generation of Zune music players. Bill Gates will be on hand for the event with the main part of the announcement to be the players, which will include the first flash memory based Zunes. Engadget adds that the rumors concerning the Zune launch may be for today or October 16, and it looks like retailers are starting to receive display units. It looks like, Engadget says, there will be two flash models and a slimmed-down hard drive edition.

Nokia (NYSE: NOK) has signed partnership deals with seven companies including CNN (NYSE: TWX) and Sony Pictures (NYSE: SNE) to bring video content to its top-of-the-range multimedia phones.

Many investors would say that it's about time eBay had admitted it had paid too much for Skype. It happens, but the key is to realize it so the company could move forward. Well, yesterday eBay Inc. (NASDAQ: EBAY) announced that the co-founder and chief executive of its Skype division was stepping down, and that the parent company would take $1.43 billion in charges for the Internet phone service division. Of that, $900 million will be a write-down in the value of Skype. The rest, $530 million , is payment for certain shareholders to settle future obligations.

If anyone still wasn't sure McDonald's (NYSE: MCD) was going after Starbucks's (NYSE: SBUX) market, yesterday the company said that it plans to make specialty coffee drinks available in all of its U.S. restaurants by the end of 2008. Yes, that means lattes too.

Some analyst calls this morning:

• Deutsche Bank downgraded CBS Corp. (NYSE: CBS) to Hold from Buy, saying disappointing rating trends and poor local advertising growth are likely to offset much of the political advertising previously expected.
• Goldman Sachs analysts resumed coverage of Bank of America (NYSE: BAC) with a Buy rating, citing "enormous unrealized equity gains."
• J.P. Morgan upgraded UBS (NYSE: UBS) to Neutral from Underweight, saying the bank is giving up on building a fixed-income business at the peak of the cycle and will concentrate on its strength of traditional investment banking flow business. UBS shares are up over 3.5% in premarket trading.
• Merrill Lynch downgraded Walgreen, Co. (NYSE: WAG) to Neutral from Buy after the company reported results below expectations. Merrill said that management's explanations didn't provide a high degree of clarity specifically as to the expense line. WAG shares, which already closed down almost 15% yesterday, are down half a percent in premarket action.

The management at Starbucks (NASDAQ: SBUX) will have more restless nights. According to documents from McDonald's (NYSE: MCD), Crain's Chicago Business says that the fast food company "plans to sell lattes, cappuccinos and other specialty drinks in all of its 14,000 U.S. restaurants next year. McDonald's predicts the new drinks will add more than $1 billion a year to sales."

One billion dollars. Starbucks did $2.3 billion in its last quarter, so if McDonald's can pick up that much of the market, it may be hard on Starbucks' same-store sales.

Howard Schultz, the founder of Starbucks, recently told The New York Times that his company had only scratched the surface of the premium coffee market. That may or may not be true, but he does have a much larger company that wants the same market, no matter how big it is.

Starbucks shares trade about $26, near their 52-week low and down from a 52-week high of $40. It does not look like those shares will be moving up.

Douglas A. McIntyre is a partner at 24/7 Wall St.

McDonald's Corp. (NYSE: MCD) and Starbucks Corp. (NASDAQ: SBUX) have been trying to cut into each other's businesses for a while now, with McDonald's introducing premium coffee and Starbucks its breakfast sandwiches. After test-marketing iced coffee and cappuccinos in various markets, McDonald's is ready to take its rivalry with Starbucks to the next level by rolling out a makeover of all its U.S. restaurants by 2009 to feature specialty beverages such as coffee drinks, smoothies, energy drinks, and other bottled beverages.

Specialty drinks have higher profit margins than sandwiches, and McDonald's estimates this "Made for You" campaign could boost sales by as much as $1 billion a year. Results from test markets in which the plan has already been tried suggest that it doesn't require additional staff and that it doesn't slow down service, but counters and drive-thru areas do have to be remodeled to make room for new equipment. Some franchisees are concerned about the costs of such renovations.

This has to be better news for McDonald's investors and watchers than Moody's downgrade of McDonald's last week due in part to competition and labor and energy costs. Shares fell 54 cents, or 1.1 percent, to $54.26 after the Moody's announcement, but closed Sept. 28 at $54.47. On the other hand, a Goldman Sachs analyst has McDonald's as a top pick in the otherwise mixed restaurant sector, for its global strength. Starbucks was downgraded last week as well.

Before the bell: Higher open seen today ahead of data

Bed Bath & Beyond Inc (NASDAQ: BBBY) posted a slightly higher quarterly profit on Wednesday after the close, helped by increased sales. The company also approved a $1 billion share buyback program. Net income rose to $147 million, or 55 cents a share. Excluding the one-time benefit, the company earned 52 cents a share, meeting Wall Street analysts' average forecast, according to Reuters Estimates. Quarterly sales rose 10% to $1.77 billion, in line with analysts' average estimate.

British Airways made its largest aircraft purchase in nearly a decade, dividing the order between rivals Boeing (NYSE: BA) and Airbus., ordering 24 Boeing 787 aircraft and 12 Airbus A380s for $8.2 billion combined at list prices.

AMR Corp. (NYSE: AMR) shares are up over 4.7% in premarket trading as FL Group, a firm with a sizable stake in American Airlines' parent, is pushing the carrier to cut loose its frequent flyer program to boost returns to investors.

Wal-Mart Stores Inc. (NYSE: WMT) was upgraded at Rochdale Securities from Hold to Buy and target upped to $55 from $39.

Google (NASDAQ: GOOG) may be working on its own Google Phone, but for now it has demonstrated that its Google Web ToolKit can be used to create applications that work well on Apple Inc.'s (NASDAQ: AAPL) iPhone as well a traditional desktop browser.

Moody's Investors Service downgraded the ratings of McDonald's Corp. (NYSE: MCD) due to its more aggressive financial strategy.

In my series on the top 25 stocks for the NEXT 25 years, I recommended Chipotle (NYSE: CMG) as one of the picks. The stock was at $82 per share on May 21 when I wrote about the company. The $82 price represented a market capitalization of $2.6 billion. Today the stock is at $114.65 with a market cap of $3.7 billion, up over 40% for investors who bought the stock.

But, I have to admit that short-term I am nervous about Chipotle. I still believe the concept is becoming the new rave in the fast food service sector. I still believe that Chipotle could take on McDonald's-like proportions in the years to come -- but I am nervous about the short-term prospects. Why?

I have two reasons. First, higher commodity prices: The price of wheat and dairy has gone up in the United States, which, I believe, could affect Chipotle's pricing structure and general margins. In this consumer-wary environment, restaurants are not about to raise menu prices and risk losing customers. Therefore, I think the food cost expenses for Chipotle's (and many other fast food chains) are going up and will stay high for a while. The second reason I am nervous is Chipotle is a domestic company with no international sales. It is purely reliant on American diners for its revenues.

I recently blogged about how I love Darden Restaurants, a company with strong fundamentals and very popular, casual dining chains like Olive Garden and Red Lobster. Even when people are getting squeezed by higher gas prices, the drop in the market, and rising interest rates, they still will treat themselves to a meal out at their favorite, fairly affordable restaurant. What about other casual dining chains?

I'm a little bit less bullish on Tim Hortons (NYSE: THI), even though Tim Hortons has a solid breakfast business (its mainstays are coffee and baked goods, with additional soups and sandwich offerings), and like Darden, has fairly strong fundamentals. While breakfast chains tend to suffer less when wallets are pinched, I think its presence in the U.S. is not strong enough to give it real legs in the U.S. marketplace, and this will hurt it as the economy staggers.

THI is a huge success in Canada, where is originated. There, it now dominates the fast food space -- with a staggering 24% market share -- and more restaurants than even McDonald's. In 2007, it plans to open 120-140 more restaurants. It captures repeat guests, and has made a solid brand for itself by serving quality, fresh food and great coffee. Its stock has benefited from the growing strength of the Canadian dollar of late, and it has excellent cash flow.

Several years ago, McDonald's (NYSE: MCD) had the exclusive franchise to provide fast food in Wal-Mart (NYSE: WMT) stores. Now, Subway is moving in [subscription required] according to the Wall Street Journal. Subway is "in 1,419 Wal-Marts compared with 1,021 McDonald's." And Subway is adding stores at the retailer much faster than McDonald's.

The Journal says that the food on the menu is a big part of the shift. Wal-Mart wants to offer healthy food to its customers as it makes the retailer seem more compassionate. Perhaps it looks bad for a fast food outlet to be pushing greasy hamburgers and French-fries on unsuspecting shoppers. And, all the soot from grilling gets on the ceilings.

There may be another explanation, though. McDonald's may be finding that Wal-Mart is not very profitable as a place to put its fast food stores. Subway recently picked up a location in Montana, but McDonald's had let the lease expire in that store.

McDonald's has built its current success on being open 24-hours a day, and serving breakfast at 5 AM. It has built its drive-in business because many people in a hurry don't want to leave their cars. None of these tactics work in Wal-Mart locations.

Subway may want to present its move into Wal-Mart as a big win, but it may just be taking over locations that McDonald's does not want.

Douglas A. McIntyre is a partner at 24/7 Wall St.

U.S. stock futures slipped this morning indicating a lower start for stocks as investors heard that lenders overseas needed to be bailed out and ahead of some economic data released today. Four major investment banks are to report next week and news of credit woes expanding may concern investors. The Federal Reserve also meets to discuss policy and decide on interest rates next week and will have to consider today's data as well as record oil prices in its decision.

Futures are declining this morning a day after stocks surged, especially blue chips led by McDonald's (NYSE: MCD) -- closed up over 6% -- and General Motors (NYSE: GM) -- closed up over 10%. Weekly jobless claims, which came in better-than-expected, helped alleviate concerns from last week's employment report and gave stocks the necessary initial boost. The Dow Jones Industrial Average rose 133 points or 1%, while the S&P 500 added 12 points, or 0.84% and the Nasdaq Composite added 8.9 points or 0.35%. Oil closed past $80 a barrel, at $80.09 for the first time.

As if a repeat of yesterday, oil prices continued to be at record high while the dollar hit another record low vis-a-vis the euro. With no major economic data or news today, U.S. stocks will likely continue yesterday's trend and start mixed, looking for direction and continuing to wait for the Fed decision next week. Barring any surprising news, trading throughout the day will also likely continue much the same way as yesterday. Major corporate news is mixed as McDonald's increased cash dividend while Alcatel-Lucent warned.
[Update 9:05: After jobless claims came in better than expected, bulls started generating momentum helped by a GM upgrade that sent GM stock up 4.7% in premarket trading and as Target considering asset sales that sent its share up 2.4%. Futures are now pointing to a higher open. More corporate news to watch this morning here: Before the bell: AAPL, GM, TGT, MRK ... ]

Yesterday, with crude hitting $80 a barrel for the first time, U.S. stocks finished mixed. The Dow industrials and the Nasdaq fell 16and 5 points respectively, while the S&P 500 ended nearly flat.

Today, oil prices retreated somewhat after settling at $79.91 Wednesday and hitting $80.18 a barrel throughout the day. So far in electronic trading today, sweet crude for October delivery lost 13 cents to $79.78. While oil may not be directly counted in core inflation indicators, the Federal Reserve may weigh its trickle effect into other prices. The Fed has always maintained that inflation is its main concern, but has been under pressure the change its hawkish monetary stance and lower rates.

For the second day now, the dollar fell to an all-time low against the euro. Traders may be moving funds to other denominations in anticipation of a rate cut. The dollar was higher against the yen.

Not much economic data is to be released today except for weekly jobless claims at 8:30 a.m. EDT. This, however may be of interest following last week's August employment report.

Overseas, Asian stocks ended mixed with Hong Kong Hang Seng hitting another record high. European stocks dropped as oil hit $80 a barrel and Alcatel-Lucent warned.

Corporate news:

It seems a good thing Alcatel-Lucent (NYSE: ALU) had had a revers stock split, this way it had more room to drop and drop it did today in Europe. Alcatel-Lucent warned. Again. For the third time this year, the company has slashed its forecast for full-year revenue growth. ALU shares are down over 11% in premarket trading.

The mortgage industry continues to be in trouble with what seems daily announcements of job cuts from different lenders. After First Horizon National (NYSE: FHN) announced cuts yesterday, Washington Mutual (NYSE: WM) followed suit today.

McDonald's (NYSE: MCD) announced late yesterday it has raised its annual dividend by 50% to $1.50 as part of a plan to return up to $17 billion to shareholders through 2009. MCD shares gained 2% in after-hours trading.

It has been assumed for several quarters that as McDonald's (NYSE: MCD) adds high-end coffee, Starbucks (NASDAQ: SBUX) might suffer. But, an analysis by Bloomberg shows that the coffee chain may be in for some very rough times. One money manager, speaking about McDonald's, told the news service, "They're a lot cheaper than Starbucks coffee in general, and they have the high quality to go with it.''

McDonald's says that it offers lattes, cappuccinos and iced brews in 9,000 U.S. restaurants. McDonald's coffee also tastes pretty good. Bloomberg reports that in March, a Consumer Reports taste test of basic black coffee found McDonald's stronger blend beat Starbucks, Burger King Holdings Inc. (NYSE: BKC) and Dunkin' Donuts Inc.

In June, rising sales of McDonald's coffee prompted Deutsche Bank Securities Inc. analyst Marc Greenberg to reduce his Starbucks stock-target price by 14 percent to $32. "The golden arches are doing coffee better,'' Greenberg wrote in an investors' note. He rates Starbucks as a "hold.''

Poor McDonald's (NYSE: MCD), can it ever catch a break? The company reports super August same-store sales and is on track for a possible great September quarter. It spends the equivalent of the GDP of Estonia in marketing, advertising and general image-building. Then comes the story of a poor McDonald's worker in Union City, Georgia who was arrested and JAILED over night for the heinous crime of: over-salting a hamburger!

That's right, you read it correctly. Ms. Kendra Bull was arrested by a high-blood pressure cop who was the victim of this over-salted burger. She was charged with a misdemeanor -- reckless conduct -- and bail was set at $1,000! It had to be a slow night in Union City.

Can you imagine the poor girl spending the night in the clink and her discussion with fellow inmates? "What are you in for?" "Armed robbery. What are you in for?" "I over-salted a burger at McDonald's and the customer was a cop!" Wow, this could mean a life sentence.