05/10/2016 BBC Business Live

This is Business Live from BBC News with Ben Thompson

The tech giant is accused of spying on millions of e-mails on behalf

Live from London, that's our top story on Wednesday, 5th October.

Yahoo won't confirm or deny reports it used special software

Bringing artificial intelligence to your home.

Google unveils its new virtual assistant.

And a couple of new smartphones as well.

The markets have got the wobblies again. We have the pound sinking

lower and share markets across Europe falling, we'll explain why.

Have you got what it takes to be a social media star?

We'll find out how your online following could lead

to a pretty lucrative marketing deal.

And are you influenced by the influencers?

Have you ever bought something promoted or

The internet giant, Yahoo, secretly scanned millions

of its users' e-mail accounts on behalf of the US

government according to the Reuters news agency.

Its report suggests the company secretly built custom software

Yahoo refused to confirm or deny the reports. It insists it is a law

abiding company. The allegation comes less

than a fortnight after Yahoo said hackers had stolen data

from about 500 million users in what could be the largest

publicly disclosed Meanwhile, Yahoo is in the process

of being taken over by Verizon Communications

in a $4.8 billion deal. Our North America Technology

Correspondent Dave Lee has been Yahoo may have hoped its troubles

were behind it, when it pinned that deal to sell itself. It has been bad

news for this company. Two weeks ago, we heard the company had been

hit by a huge cyber breach, the biggest in history. We're told Yahoo

may have been complicit in creating software, software monitoring

information that was sent to Yahoo e-mail accounts and looking for

strings or words or characters and communicating that with US

intelligence authorities. Reuters reports the software was made in

2015. Yahoo says it is a US company abiding by US law. The intelligence

agencies aren't telling us anything and ver risenon the potential new

owner of Yahoo refuses to comments on the reports at all.

Elsewhere in the tech world Google has staged

what it s calling its biggest ever product launch.

It has unveiled two new smartphones and a range of other devices.

So the search engine provider gave us a glimpse of its

It's a voice activated device which uses artificial intelligence

It's a sign of how bold tech firms are becoming in going

For instance, Google's new home management service is a direct

challenge to Amazon which has it's own household

Facebook is launching its own online sales service called Marketplace

Car-maker Toyota is also straying into new areas.

It's building a household robot that you can chat with,

And the electric car maker Tesla is also venturing into novel

territory - it's building a factory to manufacture batteries

With me is Linzi Boyd, author of Brand Famous and global

Nice to see you. Welcome. Hello. So a lot to get through. A lot was

announced yesterday. Let's start with the phones. It is the first

time it has been designed in-house, what struck me is the price tag.

They're going head-to-head with Apple's iPhone, a similar price,

similar technology. They are not trying to corner the lower end of

the market, are they? No, Google is wanting to be more of a premium

brand and they have been that except they have been an operating system.

This is their first opportunity to come out and be a hardware and so

they're positioning themselves and they're positioning themselves hard

as more of a luxury brand. Why would I opt for that phone as opposed to

the Apple or Samsung equipment? Google owns the operating system

that is sit behind. This is the first time they have been able to

put it into their own hardware system. They can be first to market

with the new phases that they bring out to market and not have to rely

on other phones to be able to bring it out for them. A big push has been

into all this home ought owemation and virtual assistance, clearly the

tech companies are looking at how we will be using technology over the

next few years and this is one of them. But again, going head-to-head

with established players and we have seen the likes of Amazon do this

already? Well, the frontier is the home. Three years ago, if you

noticed, they thought it was going to be the television. And now, three

years later, they're competing against the home. The interesting

part is that they've gone for against Amazon and Apple is not yet

really gone into connected home. They have still gone into the TV

side of things. So it will be interesting to see where it moves

to. What about the issue of privacy though? We touched yahoo today, some

viewers might think it is shocking if the revelations are true, Yahoo

not saying much about it at the moment, but in terms of this device

that Google will have in your home, building up so much data on what

you're doing, what you're talking about, where you're going, what

about the privacy? It is interesting, isn't it in Google is

known for data and Apple is more known, I think, for sales. And so, I

think Google is going to have to be careful because they are going to

now be collecting so much data from people and the whole transparency

side of things, people are already resisting having their data being

tapped into and I think there is going to be a massive backlash in

the very near future of people hacking into data and actually

resisting what people are doing with their own data.

Lindsey, thank you for explaining that. Lindsey Boyd.

In other news: The International Monetary Fund has cut its forecast

for growth in the United States, claiming that political

tensions are hindering the world's major economies.

The IMF said it expected the US economy to expand

It also warned the Brexit decision will hit the UK economy hard

and halved its 2017 growth forecast for the country to just 1.1%.

Tesla's former rival in electric cars, Henrik Fisker,

has re-entered the electric car market with two new models.

Mr Fisker's previous company built luxury cars popular with celebrities

until its high-profile bankruptcy in 2013.

For his new venture, he's announced both a high-end car

as well as an affordable mass-market model.

The IMF downgrading growth forecasts for various economies. If you are in

East Asia you are bucking that trend. The World Bank says things

are resilient. Sarah Toms is across this story

for us in our Asia Business What have we heard from the World

Bank? The World Bank has slightly raised its 2016 economic growth

forecast for East Asia and the Pacific and it says it expects the

region to grow 6.4% in 2016 and 6.2% in 2017. And forecasts for China on

those two years were unchanged. Now, the bank says that Brexit isn't

likely to have much of an impact on growth in the near term, but it

warned that the region still faces significant risks and one of them,

of course, being China's on going economic slow down, but one

highlight was Thailand which is now expected to grow by 3% despite

political uncertainty, a booming tourism industry and the

Government's investment in infrastructure is boosting consumer

confidence. Interesting into what's going on

there in East Asia. Let's show you markets in that region, how they

fair today. So Japan closing up 0.5% and Hong Kong up slightly. No trade

in Shanghai today. Mainland China, markets closed for a public holiday.

We had a weaker yen, so that boosted trade in Japan, but we've got the

price of oil edging higher, above $51 a barrel for the price of Brent.

Let's look at Europe. A different picture in Europe. We've got the

pound buying less than $1.27, the pound continuing to sink, but we've

got the markets across Europe headed lower. A few concerns out there

about rumours that European Central Bank may start to taper its

so-called quantitative easing, we will explain that in a moment, but

first of all here is Samira with a look at what's going on on Wall

Street. How many jobs did America's private sector create last month?

Well, we will find out later today when the national employment report

is released. This is a recursor to the labour department's jobs report

which comes out on Friday. Montsanta will be reporting earnings this

week. Declining commodity prices, lower

farm incomes and delays in regulatory approvals for some of its

newest products really stung the seed company in recent quarters and

finally, the boss of Mickey Mouse will be speaking at an event at

Boston College. The speech by Walt Disney's CEO comes amid reports that

Disney maybe considering a bid for Twitter.

Joining us is Nandini Ramakrishnan, Global Market Strategist at JP

Sally touched on this. Sterling falling again. Taking a hammering,

now below $1.27. We talked about it yesterday, but it is more of the

same, it is about the timetable for Brexit? The more we hear about when

Article 50 will be invoked, you see this weakness. This actually does

pose a couple good benefits for indexes like the FTSE 100 that earn

70% of their revenues from abroad so you get the translation effect,

exports are more competitive for the UK that, of that's why we are seeing

a lift in the FTSE 100 overall. With the fear of what the European

Central Bank is going to do next, you have got a possible nasty day

ahead for markets in Europe? We are seeing a lot of red on the screens

because of that word from the ECB that they might have less

quantitative easing or support for the monetary policy programmes

they're going to do. We still need to remember as investors they are

purchasing 80 billion euros worth of assets every months. They are not

halting... I remember thor that hit markets when the Fed mentioned we're

thinking about reducing quantitative easing. There was a massive reaction

on markets over the world, wasn't there? It was called the Taper

Tantrum! When you have central banks who have tried to support growth

through buying assets and by cutting interest rates, market are going to

get the knee jerk reaction. They are here for the long haul and they want

to support European growth. Everybody is used to cheap muvenlt

that's the problem. -- money. That's the problem.

Still to come: The making of a social media star.

What does it take to earn thousands of dollars every time

We meet the firm that connects the brands willing to pay big bucks

for a mention by social media's biggest stars.

You're with Business Live from BBC News.

Supermarket giant, Tesco, has seen another rise in sales,

and says it's on track to hit full-year profit targets.

Like-for-like sales for the whole group were up 1% in the half-year

of the year, and in the UK they rose by 0.6%.

Chief executive Dave Lewis said the firm had made "significant

progress" in stabilising the business.

He's been speaking to our correspondent, Emma Simpson.

I'd describe the results as exactly that, very encouraging.

Over the last two years there's been a lot of change in our business,

a lot of very hard work from 300,000 colleagues here in the UK, and I'm

really encouraged by the results we've presented today.

They were another significant step on the journey of turning

Shoppers buying more staff or are winning shoppers back

The result is, actually, we are winning shoppers back who may

You will see in the results today we show there are 200,000 people

more shopping in Tesco than there were a year ago.

So actually more people are buying more things at Tesco,

as we improve the quality of service, availability,

More people are choosing to switch where they shop and come to Tesco.

That's something that we would like to see, obviously, continue.

The critical thing is that we focus on ourselves and not

We've shown by launching initiatives like farm brands and others

that we can be very competitive with anyone in the marketplace,

and therefore there's no reason why Tesco can't compete.

So we're quite confident, despite the challenging market,

that we can be a more competitive Tesco moving forward.

And you've also given a glimpse of the future

By giving a clear indication of what it is we have an ambition

to achieve, we think we can get ourselves to a place

in three years' time where our margin can reach 3.5-4%.

That's important for people who would choose to invest in Tesco,

at a time when the market is uncertain, but it's a measure

of a business that's moving from two years where we were.

We did start at crisis, that's no secret, but having

stabilise the business, that's a level of ambition

That was Dave Lewis, the boss of Tesco. A quick look at the stories

on the Business Live page. A fear of a 10% tariff on goods into

the UK. He says those fears are overblown, do not exaggerate them,

that is his advice. Yahoo has been accused of spying

on millions of emails on behalf What do you think about this? Get in

touch with us. The tech firm has insisted

that it's a law abiding company. But not saying much more about the

story. A quick look at how

markets are faring. Markets looking pretty red today, as

they try and digests some of what have they have heard about the

timing of Brexit. FTSE 100 just tipping into positive territory. The

pound taking another hammering. A further fall this morning against

the dollar. If you are our age or older, the odds are that the names

Pewdipie and Zoella may not mean

much to many of you - but they are huge online stars -

with millions of followers for their appearances on Youtube.

Marketing companies fall over themselves to involve them

in their online campaigns - they're that big a deal.

But what happens if your marketing budget doesn't stretch to one

Or if a mid-tier player better suits your mission?

Well that's where our next guest comes in.

She's the boss of indaHash - which helps identify people

with the potential of becoming the next social media sensation.

indaHash is a technology platform that connects brands and agencies

directly to mid tier influencers to create original authentic

To date, it has built more than 11,500 partnerships.

It has run over 270 campaigns globally for brands.

Their clients have included L'Oreal, P and Google.

Barbara Soltysinska is the Chief Executive

and co-founder of indaHash, she's with us.

if I got that right! Nice to see you. Sorry if I messed up your name.

Welcome to the programme. Let's talk about this relationship. Many people

will look at social media and they may not be aware that in many cases

there is a commercial relationship between the brands that feature in

those social media videos or pictures, and the companies that

make them. Talk us through that relationship. I think that right now

it's very transparent, because the majority of influences add a

hashtag, if the post is branded. But what is new is that not just digital

brands, but people who have impact. This is something that was behind

the idea to empower real people who have 10,000 followers, for example,

not 1 million followers, and let them do campaigns for brands. Very

often they are authentic and they have great impact on the audience.

You say it is really transparent but I think many people will not find it

transparent, because they will find it difficult to work out what is a

genuine recommendation. I've used this product, I think it's good,

versus some on who is being paid to say it. That is not very

transparent, is it? I understand your concern. But I think if you are

not paid millions to recommend something, I don't believe that

those people would choose brands they don't like. In our case you

have to get some experience with products, for example you have to

buy it if the shop and then show it in your video or photo. So this is

something that makes it authentic. If you are paid ?10 or ?100, it's

not something you would make up I think. It is a gift for the big

companies, because through advertising on social media, by

using young people that appealed to the audience they're trying to sell

to, there is none of this regulation that you have to abide to, if you

are an normal television or normal media outlets. I know in the UK

there are some rules and regulation about social media advertising, but

in many countries around the world they haven't got there yet, have

they? I think in many countries there are

regulations on that, but usually it is up to the brand and we let them

do really precise targeting. To say for example, I want to target this

campaign only to women who are 25-30 years old. It is up to the brand, up

to the client, but I think they treat it as part of the media plan,

not something they can use to make tricky things. Let's talk money. I'm

a company that makes this mug, a very Lammers BBC Business Live mug.

How would I get my mug recommended? In terms of influence... When you

download the app you see a post and you can negotiate. In terms of

brands, we send in two models. First is CPM, you paint per 1000 views.

You can pay for 1 million, for example, or CPE, cost per

engagement, so you pay for interactions, like comments you get

an generated content. Which is more valuable for a company? I suppose

it's not just seeing it but interacting with it? In the UK the

majority of our campaigns are in the CPE model, but in other markets very

often we have CMP. Very good to talk to you. It is a fascinating subject.

Time is against us. I'm going to try your surname again...

If you're watching in Poland, I struggle with the Polish names. We

read a lot of international names but Polish are the trickiest!

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.

All the day's breaking business news, we will keep you up-to-date

with all the latest details, with insight and analysis from the BBC's

team of editors from around the world. And we want to hear from you,

too. Get involved on the BBC Business Live web page. You can also

find us on Twitter and Facebook. Business Live on TV and online,

whenever you need to know! So there you have it, get in touch.

Many of you getting in touch this morning. We asked at the beginning

of the programme, are you influenced by the influences, have you bought

anything you have seen online? One viewer says he finds it very

annoying, especially those adverts and promotions that are hard to

switch. and promotions that are hard to

full of endorsements these days, I full of endorsements these days, I

pay no attention any more. Another says, I find all of this very

annoying and this is a subject we touched on. We need to have more

transparency regarding the advertising of brands because young

people look at it and could be vulnerable to the advertising. Time

for a look at some other stories in the news. Samir mention this, the

Twitter story. It's an interesting one. If sales force does go through

with that it's a very corporate business minded company. Very

consumer, very of the masses. To see... Get those synergies going

between those two companies would be something interesting to watch. What

would they want? We have talked a lot about Twitter. For people who

use it, they love it. Are for people they don't, it's something they are

not engaged with. That is a problem for Twitter, getting more users and

it's not doing it the way that Facebook or Instagram is? The

quickness of engagement. If you have it on your phone you get an

immediate notification, many other companies are looking at that with

envy, to get that user engagement. It is the type of users, isn't it?

It's not necessarily a big number of users compared to Facebook, but it's

the quality of user? Let's look at some other stories, MasterCard

confident consumers will use selfies to make payments. Just when you

thought the selfie thing couldn't get any worse, you could be in the

queue to buy a copy and snap a picture of your face to pay for it,

is that how it works? Yes, it's not too far away from other things like

biometrics fingerprint. Ten years ago we would have thought

contactless was absurd but now we can't go without using it on the

tube or in a coffee shop. Do you think is a good idea? I hope it

doesn't slow down people at the till, if you don't have a good

selfie! You will find a load of people in the coffee queue doing

this. Very good to see you. Thank this. Very good to see you. Thank

you for coming in. A lot of stories for us to discuss today and a lot

for us to look ahead to. Stay tuned to the BBC for more on that Yahoo

news about whether it's scan e-mails on behalf of the government. Season

can have a good day, goodbye. -- see you soon.

Thank you for joining me. I just want to update you on the next few

days. We will start with the rest