tv BBC Business Live BBC News November 9, 2018 8:30am-9:01am GMT
this is business live from bbc news with victoria fritz and vishala sri—pathma. it's been a fairytale year for disney — but will it mean a nightmare for netflix? live from london, that's our top story on friday the 9th of november. emboldened by those record profits — of almost $13 billion for the year, disney says it's moving into streaming services. but will viewers follow? and singles day is this sunday. we look at the unexpectated ways firms are benefiting from the biggest online shopping day in the world. the markets have been open about 30 minutes and you can see in europe that the ftse is trading 33 points lower. we'll also be getting the key takeaways from the us midterms — what they mean for the us economy and financial markets.
and today we want to know whether there should be a social media ban at work? are you always on your phone? well, if you are tweet us get in touch with your views using the hashtag bbcbizlive. hello and welcome to business live. we start with walt disney — what a year for the entertainment giant. it's been on the scene a long time, but the movie and tv industry has transformed in the last few years by the rise of streaming services like netflix. disney says its positioning itself to dominate that future. these were a stellar set of results. revenues up 12% overall — far better than even the most upbeat of predictions. yet its costs are about to rocket. over the summer, disney agreed to pay £71 billion for the entertainment business of 21st century fox. and it wants to launch its own
streaming service, disney plus, to rival the likes of netflix. it will have a huge amount of content to offer. what is more, it says it is removing all of its disney content off netflix. so, is the boss worried? here's reed hastings. i think it is more like nike and adidas — you know, two great competitors around the world. they are formidable. i mean, they have so much content, star wars and marvel, and so they will be a great competitor and that will push us to do the best work of our lives, so we are really excited about it. and we have been competing with amazon for more than ten years so we are used a healthy, strong competition and it makes us better. alice enders, a media analyst from enders analysis is with me now. alice, it seems obvious why disney would want to enter the streaming
world, but is it a bit too ambitious of them? as you say, obvious because it wants to own the consumer relationships and understand what motivates people to watch this amat. ambitious, yes, because it's not the first kid the block. not only is there netflix, there is amazon prime which is a free service, so there's a lot of competition there from similar global branded business and as disney has said, the key issue is what will become exclusive and what will be taken off other distribution platforms, including maybe sky? but i think the fact is they have lucrative licensing arrangements so you will be launching a direct consumer service, so you you will be launching a direct consumer service, so you will be taking major risks. i was going to briefly interrupted, because we are
looking at some content here, and we a lwa ys looking at some content here, and we always hear that content is king but one of the issues is the confusion customers have. where do they get the content and will they deviate up differently across the platform is all well anybody have to netflix and amazon prime. at some point we hit saturation, surely? you are right and you've hit the nail on the head. this is a family expense. families have so much money and how many services can you possibly subscribe to to suit the needs of everybody? this is where price comes in. netflix is reasonably priced, and disney life has not taken off because it's a expensive service but because it's a expensive service but because so much of the disney content is available elsewhere. the core of the disney model is the
theatrical distribution, the cinema. and everything that comes after that is like the shock factor, like the theme parks, consumer merchandise, all tied in together so disney has a huge brand but ultimately when you buy a subscription service you think about getting originals that you cannot see anywhere else and netflix has made a great marketing business out of its originals and is spending $1 billion in acquiring contentjust for europe. it's certainly done well with its original content. house of cards hooked me. everywhere is producing original stuff so it is easy to have lots of subscriptions at once. it also has a global audience already. different languages. we will hear more about this in the future, i am sure. let's take a look at some of the other stories making the news.
pressure is building on the golden boy of banking, the former goldman sachs ceo lloyd blankfein. he's been exposed as the senior executive mentioned in us court papers as having met a man at the center of the 1mdb corruption scandal in malaysia. the usjustice department charged three people in the case last week, two of them were former goldman bankers. car sales in china are down almost 12%. we've seen four straight months of declines in what is the world's largest auto market. the drop comes amid broader slowing economic growth and a biting trade war between china and the united states. 0ctober‘s figures record the steepest monthly fall for almost six years. accountancy firm kpmg has said it will no longer do consultancy work for the uk's biggest companies if it is also auditing them. in a memo, the firm's chairman said the move was to "remove even the perception of a possible conflict of interest." the "big four" accountancy firms are under scrutiny following the collapse of construction firm carillion.
this weekend is singles day. the online retail event was started almost a decade ago by chinese e—commerce giant alibaba, and has fast become the biggest shopping day of the year, outstripping black friday and cyber monday. but it's notjust the money that'll be flowing in. so, controversially, will the personal data of hundreds of millions of people — as monica miller reports. this is the countdown to the biggest online shopping day of the year — notjust in china, but the world. it's called singles‘ day, held on the 11th of november. get it? all of the ones? and it is a hugely successful shopping festival, invented by chinese e—commerce giant alibaba. in 2017, alibaba earned a record 168.2 billion yuan, or us$25 billion, on that day alone. and it keeps making more money every year.
but shoppers are notjust handing over their dollars — singles‘ day might well be alibaba's biggest data collection event of the year too. take taobao, for example. it's one of alibaba's most popular shopping apps. it monitors notjust what you buy but what pages you view, what you bookmark, and uses artificial intelligence to predict what you are most likely to buy. alibaba says it does this to tailor its recommendations to you, so you have a better shopping experience. and what it is doing is pretty common in e—commerce, just like other sites like amazon — they are doing it as well. but when it comes to alibaba, it is doing it on a whole other scale. over 600 million people are using alibaba's china retail sites and apps, and millions more are using their other businesses, like financial services and entertainment sites. all of these customers are generating a huge mountain of data. china —focused equities hit
choppy waters on friday — after the us federal reserve held rates but delivered a bullish assessment. as a result, wall street analysts believe that the central bank remains on track for further increases. just like the first coffee of the morning, there's nothing quite like that first reading of uk quarterly gross domestic product to put a spring in your step. so, stop what you are doing at 9:30 gmt. if economics aren't your thing, how about commodities? 0il traders went from forecasting $100—a—barrel—crude last month to declaring an official bear market last night. prices in new york completed a drop of more than 20% since early october. andrew walker will have more on oil in about 10 minutes — but first,
lets hearfrom samira hussain about what's ahead on wall street today. it's been a busy week in the us with a mid—term elections, the new amazon headquarters rumours and google changing the way it handles claims of sexual misconduct, so there may bea of sexual misconduct, so there may be a bit ofa of sexual misconduct, so there may be a bit of a reprieve from the busy week that was, but that said there is economic data to be aware of. the price index about how much goods cost that the factory, updated numbers will be released and economists think it will have gone up economists think it will have gone up by economists think it will have gone up by 2%, and this is important because something how much costs for the seller can be a good indication of the prices consumers will have to pay of the prices consumers will have to pay " of the prices consumers will have to pay —— 0.2%. if it costs more to make it will cost more to buy. joining us is simon french, chief economist at panmure gordon & co. so, the pound sterling, it has had
an interesting week and was slightly higher but we have had a weak euro this week as well. what is going on? not moving, stirling but the euro ‘s story saw us have growth forecasts from the european commission suggesting that the uk will be at the bottom of the growth league table which has put a bit of pressure on the pound sterling and it's also trading on the brexit headlines, or will we get to withdraw deal and will it be accepted withdraw deal and will it be a cce pted by withdraw deal and will it be accepted by the cabinet and parliament? there is a lot of noise but it is on the weaker side because people are ultimately concerned that there will be an impasse between negotiations with the uk and europe. is that the only factor influencing sterling? sterling is also trading against the other big cross rate, the us dollar, based on what victoria said, the strength of the us economy driving the dollar higher. sterling has been down from about 20% in 2014. whether it will
go lower in the next month, it will probably be driven by politics rather than economics. we will get an update at 9:30am and i'm sure everybody is on tenterhooks waiting for the gdp forecast. does that have the potential to move the pound today? not really. we know what will happen largely. it will be 0.6% on quarter growth and that will tell you that there was a decent period of time for the uk economy in the summer but what will be more interesting is the monthly growth which might be 0.1% which suggest since the warm weather of the british summer you have seen growth slowing down and that is the worry in the second half of the year that the momentum we thought we had has just petered out. we will talk about social media bit later on. you are not glued to your phone? i think i see a smart watch instead. still to come.
what will those us midterm reuslts mean for markets? we get analysis. you're with business live from bbc news. about 14 shops are closing every day as uk high streets face their toughest trading climate in five years, according to a report by accountants pwc. it says more than 1100 shops disappeared from britain's top 500 high streets in the first six months of the year, with customers do more shopping online. joining us now isjohn webber, head of business. what do you think this is a result of? is it a consequence of the rise of? is it a consequence of the rise of online shopping but business rates and higher rents? yes, we've
been talking about this for some time. clearly there is a lot of change going on in the way people shop, and one of the frustrating things we see is the one thing the government can do something about his business rates and it feels like retail again, has been ignored and the recent budget announcement, there was lots to talk about the £900 million but the reality is the closures you talk about that have taken place this year, there is not onejob or shop that taken place this year, there is not one job or shop that would have been saved by the budget. that was aimed at medium—sized enterprises and people closing day in day out are the larger retailers. none have benefited from the recent announcement in the budget? we have to leave it there, but thanks for joining us. sse
s s e shares have been dropping, one of the biggest fall is, down more than 3% after it emerged that the firm have do renegotiate the terms ofa firm have do renegotiate the terms of a merger of the uk retail operations because of the introduction of an energy price cap so more cost in the business by the looks of things and i've no idea what port barrelling is so i believe that before get myself in trouble. and we were talking about what was going on with the asian markets closing in negative territory as a result of some of the bullish forecasting about what would go on with the us economy. lots more to come on the market. you're watching business live. our top story — disney's dream come true.
the movie—maker reveals record annual profits of almost $13 billion. let's have a look out the markets are faring. european markets still tracking the asian markets but a little lower and you can see what is going on with the pound and the dollar and it has been flirting with that level for quite some time now and a little bit of strength over the last couple of weeks with some reports that we were nearing a deal and then it didn't seem to be true so we saw the pound falling again but it's now at 130, pretty stable. it will be interesting to see what happens when we get the growth results. now it's time to take a look at this week's big business and economics news. and it was the week where we saw midterm elections in the us, and the global oil dipping into what's called a ‘bear market‘ and some updates on the health of the eurozone. 0ur economics correspondent andrew walker is with us now. what shall we start with? the us
midterms? the big political development of the week. president trump now has a democrat led house of representatives so what does it mean for trade policy? he has significant powers to do things by executive order like trade defences, anti—dumping action where countries can take action against stuff they think is being sold below their prices. he can do that on his own but there are some areas he needs congressional support, particularly in improving new trade agreements and going through procedures in congress. it is quite striking. trade policy is not something that has a neat, partisan division, and the main way that is resistant to the main way that is resistant to the muscular approach of this is
coming from the establishment, if you like, of his own republican party so we now have a congress with a strong democratic presence, many of whom share some of his protectionist kind of instincts. hard to read how it will play out but it‘s not obviously going to make life much more difficult. we saw with the iran nuclear deal he was able to overturn that quite quickly and that‘s a slightly different legislative branch but i suppose people will be looking at tariffs. it depends on the specific measures and whether they require approval or not. much of what he has done has been on the basis of presidential authority so many of these actions, he doesn‘t need congress to approve them. of its new trade agreement, then congress typically does need to get involved and that‘s where he might see difficulties. the other
interesting area is policy, so tax cuts, that will be hard with the democrats in the house of representatives but if he does want to put together some expansion of infrastructure then he might well get a sympathetic hearing from the democrats. at some point summary has to pay for that. let‘s talk about europe and what was going on. we have an update on the health of the eurozone. as the long—awaited european recovery been undergone? eurozone. as the long—awaited european recovery been undergone7m does seem to be faltering. the figures we had were business surveys with the purchasing managers index which gives you an indication of a month by month basis and those suggested the weakest growth in two yea rs. suggested the weakest growth in two years. there was still growth but bearin years. there was still growth but bear in mind we already had quarterly growth figures for the eurozone in the third quarter that was really disappointed and the
european commission as simon mentioned earlier, the new forecast for the eurozone as a whole, those have a continuing slowdown so there was perhaps a degree of reason for being wary about how strong the outlook is. the oil price, the other big commodity, it seems to be around $71. for the brent, yes. this also plays into the political developments in the us this week. 0ne developments in the us this week. one of the reasons for the continued wea kness one of the reasons for the continued weakness in the last few days has been the exemptions that the us administration announced for the iran sanctions and a number of countries will continue buying iranians oil without having to worry about the implications. and that does me that there is a little bit less pressure on other countries to fill the gap, so that helps
contribute to the weakness that there is another thing going on here and that has been the big increase in us shale oil production and that also is very much starting to bear down on prices and at the weekend there is a meeting of oil producers, 0pec and others, and they will be considering whether they need to start thinking about production cuts sometime in the new year. don‘t expect a decision this weekend but it is on the menu. i'm sure we will talk about this in about a month‘s time. thanks, andrew. in a moment we‘ll take a look through the business pages but first here‘s a quick reminder of how to get in touch with us. stay up—to—date with all the day‘s business news as it happens on the bbc‘s business live page. there‘s insight and analysis from our team of editors right around the globe. we want to hear from you, too. get involved on the bbc‘s business live web page at bbc.com/business. on twitter, we are @bbcbusiness. and you can find us on facebook at bbc money. business live, on tv and online. what you need to know,
when you need to know it. let‘s see what other stories are being talked about on social media. we wa nt we want you to get in touch with us about banning social media, whether thatis about banning social media, whether that is a good thing in the workplace. we have had a few tweets coming. 0l‘fashioned—comedie @0comedie vishala & victoria, if the bbc banned social media at work, how would i ever get speak to #bbcbizlive we do have to engage to see what the audience wants, so in some workplaces it is almost a prerequisite. simon, you are saying that you were one of the only people in your office that is allowed to have twitter. there is a social media policy which limit access on the desktop to social media sites.
clearly to engage with yourselves and other people. i need access to twitter. but i need to be mindful of how much i am engaging. my latest smartphone upgrade tells me i average 3.5 hours a day on it, which isa average 3.5 hours a day on it, which is a bit too much. it‘s interesting how technology gives you clues on whether you are over or under using it. my old job used to have grace period where we could log on to facebook and then count down from 1159 and we all logged on the server would crash because everyone be looking. you always want it more when it‘s limited. we do have more tweets. some businesses need responses. @thecha rleslloyd we go to work to do just that, unless facebook is part of yourjob,
it‘s kind of disrespectful to be at leisure while working to the job, coworkers & employer. we bring up this story from the times and the daily mail and it‘s all about nannies being told to sign contracts that they cannot do this because they should be looking after their charges. an interesting story on the growth of concern over child safety in an environment where potentially the person you are put in charge of your child is being distracted. it is distracting technology and whether contractually, what does that do to the relationship of trust you have twin yourself, the nanny and the ca re of twin yourself, the nanny and the care of the child. there are difficulties in all walks of life not just the workplace difficulties in all walks of life notjust the workplace but difficulties in all walks of life not just the workplace but also the home and how we navigate through this. adriano surely this is nanny state, pardon the pun. it‘s hard to strike the right balance. 0n state, pardon the pun. it‘s hard to strike the right balance. on one level you should trust the individual to use their discretion but in an environment where you can
be distracted in a moment, a young child could do something quite damaging to themselves, so you will be nervous and it‘s not surprising that a lot of nanny agencies are seeing requests for this in the contract. and older nannies as well, a requirement for them because they are a requirement for them because they a re less a requirement for them because they are less likely to be glued to their smartphones. now there will be a demand for a different age cohort to offset that are not have to use contract. it‘s interesting how the selection, the market selection, picks certain characteristics to discourage people engaging on a smartphone. simon, ithink we discourage people engaging on a smartphone. simon, i think we will leave it there. do keep your twitter thoughts coming in. that‘s it from business live today. have a lovely weekend. goodbye. we have some very unsettled weather
over the next few days and it will turn nasty for some of us later this afternoon. we have an area of low pressure developing at the moment across the atlantic, throwing this cloud ahead of it across the uk but the isobars are getting closer and closer across the uk and that will bring us stronger winds and there will be gales for some later today. showers in central and eastern parts but they will be sunny spells for a time but it‘s towards the west that we see the rain spreading and temperatures up to 11 or 14 degrees. i suspect for many that it will stay dry for daylight hours but into the evening the rain will spread to the south—west of england and across wales and you will notice that around the irish sea coast, heavy
rain from northern ireland and into the west and south—west of scotland along with those strong and gusty winds. through the rest of the night the rain will push further east and eventually it will clear into the north sea. there will be a mixture of clear spells here and there and that will get to 11 celsius. that rain will continue to clear away and there will be lengthy spells of sunshine and southern coast some western coast of england and wales, maximum temperatures around 12 to 15. into remembrance sunday it stays u nsettled 15. into remembrance sunday it stays unsettled and it‘s quite a big one stretching up to iceland and it will continue to feed in showers from the atla ntic continue to feed in showers from the atlantic so remains unsettled.
showers across the uk and english channel, quite a few which could move further inland. in the middle and her many of us it will be dry and her many of us it will be dry and there will be sunshine through remembrance sunday and maximum temperatures around ten up to 13 degrees. turning wet and windy, particularly later in the afternoon and into the evening but take care if you have travel plans. you‘re watching bbc news at 9 with me, annita mcveigh. the headlines. one person has been killed and two hurt after a stabbing attack on a busy street in melbourne, australia. police shot the attacker, who‘s now in hospital. the police quickly responded to the incident. as they got out of the car, they were confronted by a male brandishing a knife and threatening them. at the same time, passers—by were calling out that members the dup accuse the prime minister of breaking her promise over plans to avoid a hard irish border after brexit.
the prime minister will lay wreaths at the graves of the first and last uk soldiers killed in the first world war, to mark the armistice centenary. the release rate for prisoners has fallen since serial sex offender john worboys‘ parole was blocked — that‘s according to the new head of the parole board.