Morning Business Memo:
The global thirst for oil may be good news for drillers and refiners, but it's hard on US motorists. Despite a recent drop in the price of West Texas Intermediate crude, and growing US oil production, gasoline prices in most of the country are still high. The average is around $3.80 a gallon - higher in some East and West Coast states, lower in the middle part of the country. Motorists should not expect much price relief soon, because the US prices are linked to the global market. Another problem: a shortage of refiners in some regions. Despite a 10 percent plus rise in domestic oil output in 2012, the strong supply is more than met by soaring demand from overseas. The cost of Brent crude - the benchmark price for the international market is up 7 percent this year.
Until now two big players, Verizon (VZ) and AT&T (T), have dominated the US market for cell phone service. That may be about to change. Japan-based mobile carrier Softbank has deep pockets and it's reached a deal to take over Sprint-Nextel (S), buying 70 percent of the company for just over $20 billion. The proposed takeover was announced today at a joint news conference in Tokyo. The agreement is subject to approval from regulators and shareholders.
The quarterly earnings season is heating up this week with reports coming from General Electric, IBM, Microsoft, McDonald's, Bank of America and many others. Are investors getting cold feet? The stock market just had its worst week in four months. The S&P 500 and other stock averages were down more than 2 percent.
Buyers of tablets that run Microsoft's newest operating system, Windows 8, are in for a musical surprise. They'll be able to pick from millions of songs and stream them for free as long as they put up with an audio ad every 15 minutes. The new feature, called Xbox Music, is not on offer anywhere else at the moment. Sweden's Spotify, for instance, allows free on-demand music on PCs but not tablets. That requires a $10 a month subscription. Although it marks a step forward for the music industry, its appeal is limited by the expense of most mobile data plans. The free version of Xbox Music won't let you download songs and save them for offline playback. That requires paying $10 a month.
Richard Davies Business Correspondent ABC NEWS Radio ABCNews.com twitter.com/daviesabc