- - Wednesday, June 29, 2011

FEDERAL RESERVE

Banks ordered to cut retailers’ debit-card fees

The Federal Reserve said Wednesday that banks can charge retailers only 21 cents each time they swipe a debit card.

The board raised the cap from its initial proposal of 12 cents per swipe, which banks and big payment processors such as Visa and MasterCard said was too low to cover the cost of handling transactions, maintaining networks and preventing fraud.

Banks currently have no limit and charge an average of 44 cents per swipe.

The Fed voted 4-1 to adopt the rule, which was required under the financial regulatory law enacted last year. Elizabeth Duke opposed the rule. It takes effect Oct. 1, later than expected.

It was “one of our most challenging rulemakings” under the financial regulatory law, Fed Chairman Ben S. Bernanke said Wednesday. The Fed will monitor developments in the debit card market “on an ongoing basis” to gauge if it’s accomplishing the intended goals, he said.

SOCIAL MEDIA

Specific Media wins MySpace fire sale

LOS ANGELES — News Corp. has sold struggling social networking site MySpace for $35 million, mostly in stock — a fraction of what News Corp. paid for the site six years ago.

The sale to online advertising network operator Specific Media closed late Wednesday, a day before the end of News Corp.’s fiscal year. News Corp. will maintain less than a 5 percent stake in the company.

News Corp. bought MySpace for $580 million in 2005, but users and advertisers have fled the site for hotter social networks such as Facebook and Twitter.

The deal and details were first reported by the Associated Press, citing “a person familiar with the matter.” Specific Media confirmed the acquisition but not the terms of the deal later Wednesday.

PATENTS

Kodak ready for dispute with smartphone makers

Story Continues →