:00:00. > :00:00.suspected sex offender was poorly handled. Now, it is time for Asia
:00:00. > :00:18.Business Report `` Sir Peter Fahy. Japan's economy contracts in the
:00:19. > :00:26.second quarter. We will take a closer look at the results and what
:00:27. > :00:29.they mean. And, Asia's biggest company gets set to show
:00:30. > :00:42.shareholders have the bottomline is looking later today. Thank you for
:00:43. > :00:49.joining us. Japan's economy is in dire straits. The economy contracted
:00:50. > :00:53.by 1.7% in the April to June period, compared to an earlier quarter. It
:00:54. > :01:01.is not good news for the world's third`largest economy. Even more
:01:02. > :01:06.dramatic, the economy has shrunk by 6.8%. These numbers follow big gains
:01:07. > :01:15.in the previous quarter, so is this just an economy readjusting, or is
:01:16. > :01:23.it an indication of the health of the economy being linked to sail
:01:24. > :01:27.statistics? It is pretty bad. When you look at the details, it is
:01:28. > :01:31.private consumption, which really pulls down the economic growth.
:01:32. > :01:36.Private consumption fell as much as 5%, so that pretty much explains how
:01:37. > :01:41.Japan's economy is performing Right now. As a consumer, you also lost or
:01:42. > :01:51.appetite to spend after the sales tax was raised from five to 8%? Not
:01:52. > :01:57.at all. Everything looks more expensive, trains, taxis, even just
:01:58. > :02:01.a $1 bottle of water looks expensive. It is no wonder consumers
:02:02. > :02:08.don't really feel like spending more than they need. So, now you have a
:02:09. > :02:12.contraction during the April to June period. In this particular quarter,
:02:13. > :02:18.are you expecting another contraction? This could need a
:02:19. > :02:25.technical recession for the Japanese economy `` mean a technical
:02:26. > :02:30.recession. I don't we are halfway into the July/ September quarter,
:02:31. > :02:34.but we do see some improvements in consumer and business confidence. I
:02:35. > :02:41.do think it is more likely that we will see moderately positive growth,
:02:42. > :02:46.perhaps a 3% growth in the September quarter. This consumer confidence
:02:47. > :02:49.could be dealt another blow, because by next year the consumption tax
:02:50. > :02:56.will be raised again from eight to 10%. Could the government reassessed
:02:57. > :03:02.its situation? Yes, I think that would be prudent. The government
:03:03. > :03:14.should consider if Abenomics is still alive. The Japanese government
:03:15. > :03:22.may need to revise down their outlook, and they should seriously
:03:23. > :03:26.consider cancelling the last hike. What can be expected? More economic
:03:27. > :03:33.reforms, wage hikes? When will this be implemented? I think wage hikes
:03:34. > :03:37.will come through gradually, but the sad fact is that it is only
:03:38. > :03:43.happening very slowly. In the latest data, it is only rising at 0.6%, far
:03:44. > :03:52.lower than inflation, which is at 3.6%. In terms of Abenomics, it has
:03:53. > :03:58.been great so far, but from here on, it doesn't seem to be going in
:03:59. > :04:04.the right direction. In other business news, Japanese electronics
:04:05. > :04:09.giant Sony says its PlayStation TV consoles will go on sale in the US
:04:10. > :04:13.from the 14th of October, and in the UK one month later. The micro`
:04:14. > :04:18.console, which has been available in Japan since last year, is part of
:04:19. > :04:22.the company's attempt to compete with other streaming television
:04:23. > :04:27.consoles like Apple TV. It will cost $99 in the US and will include three
:04:28. > :04:40.games. Thanks to a traditional Japanese dress, the high street
:04:41. > :04:49.fashion label New Look, is profiting from its kimono style garments. They
:04:50. > :04:58.said they sold 40,000 of these tops every week. Which equates to one
:04:59. > :05:03.every five seconds. Asia's biggest electronics company updates its
:05:04. > :05:08.shareholders on results today. They expect net profits to have surged by
:05:09. > :05:17.4%. The company started out with an instant messaging service called QQ,
:05:18. > :05:24.before hitting the market with games.
:05:25. > :05:30.The cyber games arena. Players have come to sharpen their skills in an
:05:31. > :05:44.online game, where teams battle to defeat opponents. This is owned by
:05:45. > :05:49.Tencent, one of the biggest companies in China. This is one of
:05:50. > :05:55.the most popular computer games on the planet, and it costs absolutely
:05:56. > :05:59.nothing to play. Instead, the makes company money through online
:06:00. > :06:03.transactions. Players can spend their cash on purchasing new
:06:04. > :06:10.characters, or outfits for those characters. The man who started it
:06:11. > :06:17.with two partners, explains this appeal. Transpac while you don't
:06:18. > :06:24.need a very powerful computer to play, there is high awareness of the
:06:25. > :06:31.game. It is regularly updated with new characters and situations.
:06:32. > :06:35.Computer games still have a massive fan base, but even the most
:06:36. > :06:42.hard`core players are beginning to spend more time on their
:06:43. > :06:51.smartphones. QQ launched their games through a messaging application last
:06:52. > :06:54.year. If you look at their chat, they have had to implement things
:06:55. > :06:57.like mobile payments, online banking, games, even blogging
:06:58. > :07:02.platforms, to appeal to the Chinese consumer. Because of that, they have
:07:03. > :07:07.had many more channels that they can offer to monetise and develop those
:07:08. > :07:13.channels. Tencent may be ahead, but it has tough competition. Online
:07:14. > :07:20.shopping giant Alibaba has introduced its own messaging and.
:07:21. > :07:28.Another search firm has purchased new business, like App Store is.
:07:29. > :07:31.People are gearing up for the World Championships in South Korea.
:07:32. > :07:36.Tencent has profited hugely from this game, but future wealth lies in
:07:37. > :07:42.offering games through smartphones and other applications.
:07:43. > :07:46.They are cheap, have enormous music catalogues, and allow fans to share
:07:47. > :07:50.new music with their friends, and are easy to use. Streaming services
:07:51. > :07:55.are becoming increasingly popular among music lovers, and the major
:07:56. > :08:00.players are trying to get a slice of the Asian market. What does it mean
:08:01. > :08:11.for musicians? I spoke earlier to Jean Cook from the music coalition
:08:12. > :08:14.in New York. I think musicians are optimistic that new doors are
:08:15. > :08:19.opening for illegitimate music sharing system. Are deals already
:08:20. > :08:23.been signed between artists and labels that have been successful and
:08:24. > :08:32.fair for everyone? Think that is a struggle. Over the last ten years,
:08:33. > :08:35.since the founding of Napster several years ago, there was quite a
:08:36. > :08:39.bit of playing catch up within the industry, to make sure all the
:08:40. > :08:45.agreements are in place. It is quite complex. Making sure the musicians
:08:46. > :08:49.get paid is something that musicians have been very patient in waiting
:08:50. > :08:55.for. Eventually, as these markets mature, it is starting to happen.
:08:56. > :08:59.Indeed, you have the struggle from the musicians, and they are also
:09:00. > :09:05.struggling with piracy, particularly in the Asian market. Spot fire, who
:09:06. > :09:16.we interviewed weeks ago, says piracy has dropped in markets where
:09:17. > :09:20.streaming music has become popular `` Spotify. I think one of the
:09:21. > :09:26.reasons piracy exists is because of lack of availability of things that
:09:27. > :09:30.people want. The technology exists, but the platforms have not been
:09:31. > :09:35.built. 2014 is seen as a year that will be a big year for streaming
:09:36. > :09:38.music in Asia, and as these legitimate marketplace is get up and
:09:39. > :09:42.going, I think consumers will find that if they want to support the
:09:43. > :09:46.artist, it is much easier to do so, and they will. That was Jean Cook
:09:47. > :09:53.from the future of music coalition in New York. A quick look at the
:09:54. > :09:59.markets. Asian stocks are currently mixed. US stocks ended slightly
:10:00. > :10:03.lower overnight, pressured by a slide in energy share prices, and
:10:04. > :10:18.worries over developments in Russia and Ukraine. The Dow Jones
:10:19. > :10:28.industrial average slipped. Thank you for investing your time
:10:29. > :10:47.with us, I am Rico Hizon. Our top stories: The legendary
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