Microsoft (NASDAQ: MSFT) will be releasing a family-oriented version of its Xbox 360 gaming console in November to target the family crowd and draw more price-conscious consumers into its gaming ecosystem. The newer Xbox 360 Arcade will forgo the expensive hard drive for a measly 256 megabytes of storage, and will come with a single wireless controller and five family-themed games. Here's the kicker: the system will sell for $279.99, only $30 higher than the reigning family-gaming champ, the Nintendo Wii.

When the Wii debuted almost a year ago, nobody could have predicted that Nintendo's focus on lower price, lower performance but more fun game console would take the market by storm and outsell technically superior offerings from both Microsoft and Sony (NYSE: SNE). Now that the Wii is the gaming console to beat, Microsoft has leveled the playing field a bit on price and a pack of family games, although it's hard to see if those two things alone will challenge the unique, physically-active gameplay that the Wii provides -- and which has made it attractive to the mass consumer.

The Xbox 360 Arcade console will include games like PAC-MAN Championship Edition, Luxor 2 and Uno. At the same time, Microsoft announced that it is increasing the amount of family-related content in the Xbox 360 games that can be downloaded to consoles over the internet (no physical purchase needed). Is this an attack on Nintendo's Wii at the precise time when holiday shopping will start heating up? You bet it is, but I have a feeling the effort may not be a grand slam. The Xbox 360 does offer a much larger amount of graphics horsepower than the Nintendo Wii, but customers have already voted with their wallets, in that they don't care. But the price parity is now largely gone. Will those that were considering the Wii now set the Xbox 360 Arcade edition next to it in those purchase decisions? Microsoft hopes so.

[Disclosure: I own MSFT shares as of 10-25-07]

Wal-Mart (NYSE: WMT) is reducing the amount of capital expenditures for 2007 in light of reduced expansion of the company's Supercenters in the domestic market as it attempts to eke out more sales from existing stores.

Well, as I've stated for over a year here at BloggingStocks, this is a strategy that the retailer was forced to take. It's already saturated many U.S. markets, and opening stores for the sake of opening them just won't cut it for growth any longer. The problem is that I still don't see the changes that will make sales growth happen in existing stores. Doug McIntyre even wrote about the retailer closing some stores about a year ago. What's in store for the retailer is anyone's guess at this point.

As a result, the world's largest retailer will cut its capex amount down in the range of $14.7 billion to $15.4 billion, down from a figure of $17 billion earlier in the year. Wal-Mart's chief administrative officer, John Menzer, stated that the retailer still has a goal to "beat" the $15.5 billion figure, however. With Wal-Mart's recent unwavering plan to continue opening stores in the face of declining same-store sales at existing locations, this admission was a bit overdue, to put it mildly.

The retailer also reiterated capex plans for fiscal years 2009 and 2010, saying it would spend $13.5 billion to $15.2 billion each year. Along with that, the retailer expects square footage growth (new stores, in other words) to come in at 6% for the current fiscal year, with a 5% to 6% figure for the 2009 and 2010 fiscal years as well.

Target (NYSE: TGT) and the U.S. Consumer Product Safety Commission have announced a recall of the popular Cars movie-themed backpacks which contain magnets that could become dislodged. Any small pieces that can easily be taken off any consumer product are a choking hazard to small children.

Again and again, Chinese manufacturers and U.S. vendors can't seem to design products made for children that won't end up with parts that can come off and be swallowed by kids. We're cracking into the human genome in another field, but hey, forget backpack design, right? My goodness, must be a toughie.

110,000 Chinese-made Cars backpacks are being recalled after magnets fell out of a piece of the plastic enclosure attached to the backpacks in three separate instances, although no subsequent injuries were reported. The backpacks in question were sold at Target stores nationwide from February through September of this year for $13 each.

So, this may not be a lead-paint recall issue from Chinese-sourced products, but that does not diminish the fact that it's still just as important. With China now making 80% of the world's toys, the parade of recalls is sure to continue. Stay tuned to BloggingStocks for more coverage of product recalls from the retail industry as they happen, because they will.

When I meet fans of Apple, Inc.'s (NASDAQ: AAPL) products, it quickly becomes obvious that these people are in love with the brand. I highly admire Apple myself, although I own none of the company's products. The marketing, design and advertising finesse the company displays has literally no equal in the world right now when it comes to consumer electronics.

But after reading this article about the iPhone's security problems, one begins to think about all the possible time-bombs that are in the clutches of Apple's fans right now. The iPhone product, which sold over one million units in the first three months of launch as reported in Apple's quarterly results this week, is a phenomenon that's still going strong. It has technical shortcomings, but those are easy to ignore given its user interface and 'wow' factor. Evidently, though, there is a major thorn in the side of the product, and it's one that could prove disastrous if the iPhone becomes as ubiquitous as the Windows PC became over a decade ago.

The flaw, as noted by several computer security experts, rests in the way the iPhone's operating system was designed. A popular product -- like Microsoft's Windows, for example -- always becomes a target of digital thieves and hackers, and so far, the iPhone is headed up that scale very rapidly. Security experts liken the problems inherent with Apple's iPhone to the same problems Microsoft Corp. (NASDAQ: MSFT) faced when it released Windows 95 over 10 years ago.

Amazon.com (NASDAQ: AMZN) took the curtains off a new business assistance offering this week, as the e-tailer's new "All Business Center" will be targeted at helping entrepreneurs find the products they need to service their small- and medium-sized businesses. Basically, this is a sub-brand of Amazon that I see competing with the likes of Staples (NASDAQ: SPLS) and Best Buy (NYSE: BBY)'s "Best Buy for Business" division.

Amazon's new offering will include quick and easy access to small- and medium-business products. Try these categories on for size: software, computers, printers, books and office products. While this is not exactly innovative, it's a great targeting technique for the largest internet retailer as it diversifies its customer base in many areas outside the standard consumer. In addition to products, Amazon's business services will also be pitched -- offerings like Amazon Web Services, Fulfillment by Amazon and Amazon Corporate Accounts will also be inserted into its "All Business Center."

Amazon knows that launching a small business and taking that first step as an entrepreneur can be exhilarating yet dangerous, and wants to give these customers the tools to manage inventory, unexpected growth and initial low sales, according to Amazon VP Greg Hart. Well, that's great -- but offering products like office superstores have done for years won't catch customers and hold their attention. What will are Amazon's small business customer forums, idea exchanges and real-time communication channels that have already proved workable with standard consumers. Communication is still key.

EMC Corp. (NYSE: EMC) saw quarterly gains in its just-reported Q3 numbers, as profit spiked 77% on increasing sales of data storage hardware and software. EMC timed the sale of its past ownership stake in hot company VMWare in the quarter as well, which added significantly to the company's profit figure for the quarter.

Net income for the Q3 (July-September) period was reported at $492.9 million ($0.23 per share), a jump over last year's Q3 figure of $283.7 million ($0.13 per share). From July to September, EMC's revenue was up sharply from the year-ago quarter's $2.82 billion, landing at $3.29 billion for the quarter. Expectations were at $3.12 billion, so EMC can rest easy (well, for a week or so) knowing it beat analyst estimates.

For the quarter, EMC raked in over $115 million selling its six million share stake in VMWare to Cisco Systems, Inc. (NASDAQ: CSCO), so EMC's real gain for the quarter (minus that sale) stood at $377.8 million -- still a very handsome number. In addressing results for the quarter, the company said that it will be boosting its stock buyback total for 2007 to $2 billion, nearly double the prior commitment of $1 billion.

Microsoft (NASDAQ: MSFT) will be reporting its Q1 results tomorrow, and industry estimates have the world's largest software maker pegged at an EPS figure of $0.39 on $12.57 billion in revenue. In July (Q4's conclusion), Microsoft forecast a Q1 profit of 38 cents per share to 40 cents per share on revenue of $12.4 billion to $12.6 billion.

Analyst predictions for Q1 performance centered on better-than-expected PC sales on a global basis plus the uber-successful launch of Microsoft's Halo 3 game for the Xbox 360 console that went on sale about a month ago. First-day sales of the game set entertainment records, outpacing any previous game or even film, with a take of $170 million.

Microsoft is also set to launch a stripped-down version of the Xbox 360 console in November at a price point of $279, pegged squarely at competing with the best-selling Nintendo Wii system that has proved incredibly popular this year due to its unique gameplay and $249 price. But that won't help Q1 numbers -- only Q2 numbers. Still, the software company may have a splendid Q1 period, and as of now, its shares are trading above $30 for the first time since July.

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Wipro (NYSE: WIP), one of the largest companies in India, announced this past week that it saw a profit rise of 17% to $204 million in its latest quarter, on the back of new outsourcing contracts and gains from a U.S.-based acquisition. Wipro is currently the India's third-largest outsourcing company, and handles accounting, customer service, human resources and other functions for many firms in the Fortune 500. If you've ever read about outsourcing domestic jobs to India, this is a top company in that field.

Sales in the July to September quarter rose to $1.2 billion as Wipro acquired almost 60 new contracts and saw an increase in sales based on its acquisition of New Jersey-based Infocrossing Inc., a networking infrastructure company. Wipro announced that a single contract alone with an unidentified U.S. company was worth $160 million alone. At the end of the quarter, Wipro employed over 77,000 people.

In addition to labor outsourcing, the company writes software for the likes of General Motors (NYSE: GM) and Cisco Systems (NASDAQ: CSCO). With such a stellar quarter, the company's CEO stated that new clients were being charged 3% to 5% above standard billing rates, and that it was billing existing clients at higher rates. I'm not sure that's the kind of thing you want to release publicly, but there you have it. Wipro, expect from phone calls soon, okay?

Toyota (NYSE: TM) seems to have a newly energized General Motors (NYSE: GM) grabbing for its throat, as the American automaker outpaced Toyota for global sales in the first three quarters of 2007 just as Toyota gained the position of the world's largest automaker after decades losing that title to its American competitor.

Add to that a loss of the top spot in auto reliability from Consumer Reports and a large Japanese recall, and Toyota -- which was shining over the summer -- has a few bruises as of late. General Motors is not sitting still, increasing its global presence very aggressively, just when Toyota probably thought it had the Detroit behemoth pinned. Toyota, ever the trendsetter, wants to gain some cachet back by making lighter cars that increase gas mileage even more than its current lineup can. After all, better gas mileage equals more sales in this day and age.

The Japanese automaker is experimenting with carbon fiber and aluminum in more designs to shed excess weight from concept vehicles, probably in an effort to firmly plant itself atop the mountain for cars that travel more and more on less and less gas. Is it a tactic to win more sales against some resurgent competitors or an effort to be an innovator? A little of both, most likely.

Consumers want the space of an SUV without the weight (poor gas economy) or the price, which is where Toyota has shined before. It can't rest on those laurels though, as GM has caught on and will join the race for more gas-efficient cars with lighter metals instead of sacrificing space. This battle has just begun, in other words.

Motorola, Inc. (NYSE: MOT) is set to release its latest quarterly earnings this week, and earnings are expected to be $0.04 per share according to analyst estimates. Although Motorola CEO Ed Zander has jettisoned about 10% of the company's global workforce and has finally introduced a true successor to the record-setting RAZR handset from 2004 (the RAZR 2), he may just be biding his time until he gets the boot.

When Motorola's time comes tomorrow, the company will most likely report a profit -- its first in three quarters. But does a small quarterly profit make for a legitimate comeback? Not at all. The first half of this year saw a $209 million loss for the largest cellphone maker in the U.S., and a profit (even a small one) this quarter will be the final opportunity for Zander to produce a return to consistent profitability by the end of 2007. If he does not show this, expect a resignation. For Carl Icahn, who has been critical of Zander, it would be sweet justice.

Although cutting costs is the top tool for Zander, improving sales and margins is much more important if he doesn't want to be seen as a leader who can't produce growth quarter by quarter. His days may or may not be limited, but by the end of 2007, the writing will be on the wall. Either Zander finds a way to grow sales and profit beyond cost cutting, or investors who want to unlock more value from the company will scream until he's ejected from the company.

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Target (NYSE: TGT) announced a weaker October sales forecast this week, causing its shares to take a small decline as analysts, as usual, responded to mind-numbingly short-term mental ramblings and may have seen a possible retail apocalypse coming. Well, that's a tad dramatic, but you get the picture.

Target officials said that same-store sales for October would only increase 2% to 4% for October. Reasons were given as higher-than-anticipated daily sales volatility and declining sales for the first two weeks of the month. Although previous sales forecasts were in the range of 3% to 5%, this minor, predictive drop was enough to give some investors the willies. Too bad warmer weather in October undercut the general seasonal spike in winter apparel sales. Ah -- the market is a slave to Mother Nature, yes?

The problem as I see it is with Target trimming its sales forecast for the second month in a row. In September, the discount retailer took its guidance from a 4% to 6% same-store sales growth figure down to 1.5% to 2.5%, setting up a few possible retail outlook shenanigans from industry pundits who saw this as one of the first signs of increasing consumer spending weakness heading into the holiday shopping season. Time to whip out that crystal ball and see what's on tap for November sales. More at 11...

European pharmaceutical giant GlaxoSmithKline PLC (NYSE: GSK) stated today that its Q3 profit dropped 5.8% on slowing sales of its Avandia product along with stiffer competition from generic versions of many of its popular products. This was to be expected, as it was mentioned in GSK's last quarterly results as a warning on future guidance. But the firm is not sitting still while some of its sales are being taken by generic competitors, that's for sure.

The world's second-largest drugmaker after U.S.-based Pfizer, Inc. (NYSE: PFE) said that it will be rolling out a $3 billion program designed to cut costs amid an expected drop in 2008's profit due to -- you guessed it -- generic competition. The company is expecting the sales decline in its Avandia diabetes drug product to continue into next year as well.

Avandia, once one of GSK's most promising products, saw sales plummet off the deep end in the latest quarter. In the U.S., the drug saw a 48% decline. The drop was partly due to safety concerns around the drug that arose this summer after a negative article in The New England Journal of Medicine affected prescriptions globally. GSK CEO Jean-Pierre Garnier said job losses will be unavoidable, but did not go into specifics. However, GSK did reaffirm its outlook for the current fiscal year, saying that EPS growth of between 8% and 10% would be expected at constant exchange rates.

Sue Decker, the president of Yahoo! (NASDAQ: YHOO), announced today that Korea is one of the company's "most important" markets. Decker said that Korea's market growth has been in excess of 20% so far (in past years), and that growth in the next four years will be even stronger than that. That's great news, but Yahoo! must figure out how to monetize more of that growth, which is the perennial problem it has faced in the last few years.

Yahoo!'s global user base is probably the most impressive among all internet destinations or properties, in terms of sheer eyeball or page-view count. Its problem is that it did not keep and manage that growth with an appropriate rise in revenue. Its chief competitor Google (NASDAQ: GOOG) managed to grow its user base at the same time it grew its revenue base with its unique form of advertising.

Yahoo!'s Korean unit, aptly named Yahoo! Korea, is celebrating its 10-year anniversary, and Decker added that the web giant's Korean unit is "certainly is a center of innovation... and we watch this market very closely." But it's time to walk the walk, and prove that Yahoo!'s growth in an important international market can carry the right amount of weight in regards to revenue.

Decker also stated that Yahoo! will continue to support Yahoo! Korea to ensure the division is "striking a good balance between globalizing and localizing." Local flavor is what catches eyeballs and keeps them (which makes for better advertising opportunity), so Yahoo! is clawing up the right tree here. Let's hope that can spread to the company's global operations soon.

Vincent DeDomenico, the creator and purveyor of the household name Rice-A-Roni, has passed away at the age of 92, according to his family. DeDomenico was the son of Italian immigrants who loved his family neighbor's Armenian rice recipe and decided to bring it to the United States. A generation later, the Rice-A-Roni brand was a staple in kitchens across the country.

Rice-A-Roni, known the world over as "The San Francisco Treat," was the result of DeDomenico's work in his family's pasta business in the 1940s and 1950s, when in 1958 he decided to venture out to create the unique mix of vermicelli, macaroni and special flavorings.

After perfecting the "dry" preparation of the new creation, which included a soup base made for the U.S. Army, the marketing began using scenes of DeDomenico's preferred living area -- San Francisco. Featuring cable cars and hilly streets, the "San Francisco Treat" ad campaign and catchy jingle started ringing up sales for the product, and DeDomenico never looked back.

In 1986, the brand was sold to Quaker Oats in a $300 million transaction. It's now owned by PepsiCo Inc. (NYSE: PEP). Even after having created an American kitchen classic, DeDomenico continued to bring home culinary ideas to test on his family. As his daughter Marla Bleecher said, "We ate these products until we were all sick of them."

Dell (NASDAQ: DELL) will begin selling its PCs in Staples (NASDAQ: SPLS) office supply stores as of November 11, according to both companies. The PC lineup will include Dell's Inspiron 530 desktop PCs and two versions of Inspiron notebooks, as well as supplemental Dell products like all-in-one printers and flat-panel LCD monitors.

Will this help Dell have a strong holiday sales push? Possibly, but it's doubtful.

Dell's deal with Wal-Mart (NYSE: WMT) was grand when it was announced, but since the company has given no specific performance figures on how well its retail effort in Wal-Mart has fared, it's hard to gauge how customers will react to Dell's brand in Staples. Does Staples even sell many PCs?

Dell systems in Wal-Mart stores reflected an aura of older or overstocked parts assembled into PCs and dumped into Wal-Mart's parking lot, rather than any specific computer build made for the retailer, and I'm not so sure customers have responded in droves to buy Dells inside those local Wal-Mart stores. Not enough time has gone by, though, so I could be jumping the gun here.

Dell's latest partnership will put its PCs and products into 1,400 more retail locations, which will instantly give it more exposure to the American buying public. Perhaps that is what Dell is going after here -- mass exposure (which brings a certain amount of purchases) instead of strategic, slower partnerships. Dell is expected to strike more retail agreements in the next 12 to 18 months, but not without challenges, according to Robert W. Baird analyst Daniel Renouard. Dell is now significantly behind competitor Hewlett-Packard (NYSE: HPQ) in overall computer system sales, and these retail efforts are considered by many to be a desperate attempt to win back market share. Right now, it's too early to attribute any success or failure in that effort.