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10 things to watch for in the year '10

As 2009 comes to a close, major business news remained rooted in emerging from the recession, with problem sectors like housing, finance and the auto industry being closely watched. What industries and organizations will fuel major changes in 2010 or see themselves undergo major changes?

Here are 10 situations to watch: five that will make news in and around Lexington, and five with national implications that have local significance, too.

World Equestrian Games

The Vine Street sign is busy counting down the days until Sept. 25, when the 2010 Alltech FEI World Equestrian Games get under way at the Kentucky Horse Park.

Two questions hover: Will Lexington, the Horse Park and the state be ready for the possible influx of 300,000 visitors? And will this influx really live up to expectations and bestow a major economic boon on Lexington and surrounding areas? Organizers and officials say the answer to both is yes, but there's a lot no one will know until that first horse trots into the ring.

CentrePointe

A prime block of downtown continues to look more like a horse pasture than a construction site after the proposed $250 million CentrePointe project stalled.

The unidentified investor putting up the money died, and did so without a will, developer Dudley Webb said. Will the mysterious person's heirs share their inheritance to build CentrePointe?

Webb stands behind the project and has said he wants the site looking nice for the World Equestrian Games. It might just remain a grassy acre in the middle of downtown for a while.

Slots at tracks

Kentucky's racetracks and horse industry continue to put their money on expanded gambling, but the odds of getting anything through the General Assembly, which starts Jan. 5, look slim.

But that won't stop horsemen from trying. The group wants slots to be allowed by passage of a state law instead of a constitutional amendment. And they intend to be big players in the 2010 elections. Come November, they might be fighting more than one constitutional amendment on gambling, too.

ACS

Earlier this year, copier powerhouse Xerox announced it would buy Affiliated Computer Services, commonly called ACS.

ACS has become known for taking on tasks for other companies, including helping to manage payroll or run health care plans. It also operates call centers for technical support and other work.

The company is the third-largest private employer in Lexington, with 2,000 workers, and the sixth-largest in Kentucky, with 4,000. It employs 74,000 worldwide.

With the marriage to Xerox, the company is expected to benefit as it gains a foothold with Xerox's customer base.

Tom Blodgett, the Lexington-based chief operating officer of commercial operations for ACS, said Xerox's acquisition might mean more Kentucky jobs next year.

East Kentucky Power

The state Public Service Commission is expected to release a report on the electric cooperative in January.

It's the culmination of three years of concern by the commission about the financial condition of the utility, which provides electricity for more than 500,000 homes, farms and businesses through its 16 member cooperatives.

The report will explore to what extent, if any, the co-op's management structure has contributed to its financial problems.

There has been concern that the structure of its board, composed of representatives of its 16 member co-ops, is inherently flawed because the customers might be more interested in their own co-ops than the health of the parent co-op.

Housing

The housing market has begun to look up in the last few months as buyers poured into the marketplace, lured by the federal government's initial $8,000 new-homebuyer tax credit and then its renewal and expansion to include current homeowners.

Those tax credits expire in the spring, the same time that many experts predict prices will hit a new low, perhaps falling an additional 5 percent to 10 percent, as more foreclosures get pushed onto the market.

In addition to the tax credit, buyers are being attracted by low prices and mortgage rates. The Federal Reserve has kept interest rates in the 5 percent range since spring, making home ownership more affordable for many buyers.

Locally, home sales have soared in recent months because of the tax credit. Sales of single-family residential homes in Central Kentucky rose 49.6 percent in November compared to a year earlier, according to data released by the Lexington-Bluegrass Association of Realtors.

Automotive

Automotive sales bounced around in 2009, with gains coming from the federal Cash for Clunkers program, but they were stable in November, despite major cash incentives.

Small monthly auto sale increases are likely as the economy continues its slow improvement, but larger sales gains will not happen until the jobless rate drops substantially and people feel confident spending money on big-ticket items, analysts say.

But production is starting to pick up again as auto makers begin to build back inventories after spending much of the past two years trying to draw them down.

Toyota, which has its largest North American plant in Georgetown, has rehired temporary workers as it ramps up its production. But farther down the road, in Bowling Green, General Motors' Corvette plant recently laid off more employees as the luxury car market continues to struggle.

Jobless rate

Job creation is expected to remain far too weak in the coming months to absorb the 15.4 million unemployed people as of November who are seeking work — and the 11.5 million others who are underemployed. As more people begin seeking work, the jobless rate is likely to resume its rise after a brief reprieve last month.

The better-than-expected figures in November provided a rare dose of good news for a labor market that has lost 7.2 million jobs in two years. The unemployment rate hadn't fallen since July. But one reason for those better numbers was that more of the unemployed are giving up on looking for work.

Kentucky's unemployment rate has outpaced the nation's during the recession, as the state's strength in manufacturing has made it more prone to job losses.

Google Earth

By Google Earth, we don't mean the program, we mean Google taking over Earth.

The king of online searches has branched out in a short time to all manner of communications.

The company's Gmail e-mail system is widely viewed as the best such service. Google Voice offers phone numbers and voicemail services, among other features. Google Wave is looking to revolutionize how users communicate via e-mail.

And the most highly watched is Google's entry into telecommunications with the Google Phone. The company previously had been content to develop its mobile operating system Android, which is on the hot new Droid phone from Motorola.

But now Google is working on a phone called Nexus One. The handset is being tested by Google's 20,000 employees, who received the device earlier this month. It is expected to go on sale early next year.

Comcast

Network television as it's known today might be on the cusp of major changes.

Cable giant Comcast recently announced its purchase of a majority stake in NBC Universal. The move gives Comcast ownership of more movies and TV shows, offering it a position of strength if fewer people sign up for its cable TV services and watch more video online.

Comcast's hard-wired delivery system serves a quarter of the nation's pay TV households and isn't about to be thrown overboard, but Comcast has decided it must be much more than a cable TV provider. Even after acquiring or developing cable TV channels including E! and Golf Channel, cable TV and other services running through Comcast's pipes make up 95 percent of its revenue. That would drop to 65 percent if the NBC Universal deal goes through, giving Comcast control of the Peacock network; cable channels such as USA, Bravo and Syfy; and the Universal Pictures studio.

And over time, cable TV figures to matter even less as people watch more video on PCs and cell phones, or through video game consoles connected to the Internet.

But the move has worried consumer rights groups and rival cable companies as they fear a Comcast-controlled company will be less likely to negotiate with rivals about carrying NBC and Comcast-owned channels on their cable systems. Also, Comcast has been vilified by the tech crowd for its decision to monitor bandwidth used by customers and stop servicing those who use a large amount.

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