:00:00. > :00:00.suspected sex offender was poorly handled. Now on BBC News all the
:00:00. > :00:16.latest business news live from Singapore. Japan's economy contracts
:00:17. > :00:25.in the second quarter. We will take a closer look at the results and
:00:26. > :00:27.what they mean. And Tencent, Asia's biggest company gets set to show
:00:28. > :00:42.shareholders how the bottomline is looking, later today. Thank you for
:00:43. > :00:45.joining us. I'm Rico Hizon. Japan's economy is in dire straits. The
:00:46. > :00:49.economy contracted by 1.7% in the April`June period, compared to an
:00:50. > :00:54.earlier quarter. It is not good news for the world's third`largest
:00:55. > :01:07.economy. And even more dramatic, the economy has shrunk by 6.8%. But
:01:08. > :01:10.today's numbers follow big gains in the previous quarter, so is this
:01:11. > :01:13.just an economy readjusting, or is it an indication of the health of
:01:14. > :01:23.the economy, being linked to sale statistics? `` sales tax. I spoke to
:01:24. > :01:27.a Japanese macro economist. It is pretty bad. When you look at the
:01:28. > :01:33.details, it is private consumption which really pulls down the economic
:01:34. > :01:37.growth. Private consumption in April June quarter fell as much as 5%, so
:01:38. > :01:43.that pretty much explains how Japan's economy is performing right
:01:44. > :01:47.now. So as a consumer, you also lost your appetite to spend after the
:01:48. > :01:55.sales tax was raised from 5% to 8%? Not at all. After the consumption
:01:56. > :01:58.tax rate hike, everything looks more expensive, trains, taxis, even just
:01:59. > :02:02.a $1 bottle of water looks expensive. So it is no wonder
:02:03. > :02:09.consumers don't really feel like spending more than they need. All
:02:10. > :02:11.right, so now you have a contraction during the April`June period. In
:02:12. > :02:17.this particular quarter, are you expecting another contraction? With
:02:18. > :02:24.two consecutive quarters, this could mean a technical recession for the
:02:25. > :02:29.Japanese economy. I actually don't think so. We are halfway into the
:02:30. > :02:33.July`September quarter, but we do see some improvements in consumer
:02:34. > :02:36.and business confidence. So I do think it is more likely that we will
:02:37. > :02:47.see moderately positive growth, perhaps a 3% growth in the September
:02:48. > :02:49.quarter. But this consumer confidence could be dealt another
:02:50. > :02:54.blow, because by next year the consumption tax will be raised again
:02:55. > :02:58.from 8% to 10%. So could the government reassess its situation?
:02:59. > :03:09.Yes, I think that would be prudent. The government should consider if
:03:10. > :03:13.Abenomics is still alive. I think with this bad second`quarter
:03:14. > :03:16.number, the Japanese government may need to revise down their outlook,
:03:17. > :03:22.and they should seriously consider cancelling the last hike. So what
:03:23. > :03:26.can we expect, then? More economic reforms, wage hikes? When will this
:03:27. > :03:30.be implemented? I think wage hikes will come through gradually, but the
:03:31. > :03:36.sad fact is that it is only happening very slowly. In the latest
:03:37. > :03:47.data, it is only rising at 0.6%, far lower than inflation, which is at
:03:48. > :03:51.3.6%. So in terms of Abenomics, it has been great so far, but from here
:03:52. > :04:00.on, it doesn't seem to be going in the right direction. In other
:04:01. > :04:04.business news, Japanese electronics giant Sony says its PlayStation TV
:04:05. > :04:11.consoles will go on sale in the US from the 14th of October, and in the
:04:12. > :04:14.UK one month later. The micro`console, which has been
:04:15. > :04:17.available in Japan since last year, is part of the company's attempt to
:04:18. > :04:23.compete with other streaming television consoles like Apple TV.
:04:24. > :04:39.It will cost $99 in the US, and will include three games. Hand `` and
:04:40. > :04:42.with thanks to a traditional Japanese dress, the high street
:04:43. > :04:46.fashion label New Look is profiting from its kimono`style garments. The
:04:47. > :04:53.company said its underlying operating profit was up by 30%. They
:04:54. > :05:01.have sold 40,000 of these tops every week, which equates to one every
:05:02. > :05:07.five seconds. A popular kimono! What a statistic there. Asia's biggest
:05:08. > :05:12.electronics company updates its shareholders on results today.
:05:13. > :05:17.Investors are expecting net profits to have surged by 4%. The Chinese
:05:18. > :05:21.company started out with an instant messaging service called QQ, before
:05:22. > :05:25.hitting the market with games. Now it is during its effort behind
:05:26. > :05:29.mobile offerings, as our correspondent reports. The cyber
:05:30. > :05:32.games arena. Players have come to sharpen their skills in an online
:05:33. > :05:48.game, where teams battle to defeat opponents. League of Legends, or LL,
:05:49. > :05:51.as it is known, is owned by Tencent, one of the biggest companies in
:05:52. > :05:54.China. This is one of the most popular computer games on the
:05:55. > :05:58.planet, and it costs absolutely nothing to play. Instead, the makes
:05:59. > :06:05.company money through online transactions. So players can spend
:06:06. > :06:13.their cash on purchasing new characters, or outfits for those
:06:14. > :06:18.characters. The man who started it, with two partners, explains this
:06:19. > :06:22.appeal. TRANSLATION: While you don't need a very powerful computer to
:06:23. > :06:33.play, there is high awareness of the game. Because of frequent
:06:34. > :06:36.competitions. Also, it is regularly updated with new characters and
:06:37. > :06:38.situations. Computer games still have a massive fan base, but even
:06:39. > :06:44.the most hard`core players are beginning to spend more time on
:06:45. > :06:51.their smartphones. Tencent launched their games through a messaging
:06:52. > :06:59.application last year. Titles like Thunder Raid, and Dash. If you look
:07:00. > :07:01.at their chat, they have had to implement things like mobile
:07:02. > :07:05.payments, online banking, games, even blogging platforms, to appeal
:07:06. > :07:08.to the Chinese consumer. And because of that, they have had many more
:07:09. > :07:11.channels that they can offer to monetise and develop those channels.
:07:12. > :07:15.Tencent may be ahead, but it has tough competition. Online shopping
:07:16. > :07:29.giant Alibaba has introduced its own messaging app. Search firm Baidu has
:07:30. > :07:38.purchased new business, like App Store is. Back at the Arena, people
:07:39. > :07:41.are gearing up for the World Championships in South Korea.
:07:42. > :07:43.Tencent has profited hugely from this game, but future wealth lies in
:07:44. > :07:46.offering games through smartphones and other applications. They are
:07:47. > :07:49.cheap, have enormous music catalogues, and allow fans to share
:07:50. > :07:54.new music with their friends, and are easy to use. Streaming services
:07:55. > :07:57.are becoming increasingly popular among music lovers, and the major
:07:58. > :08:03.players are trying to get a slice of the Asian market. But what does it
:08:04. > :08:07.mean for musicians? For more on that, I spoke earlier to Jean Cook
:08:08. > :08:10.from the Music Coalition in New York. I think musicians are
:08:11. > :08:17.optimistic that new doors are opening for a legitimate
:08:18. > :08:24.music`sharing system. A digital marketplace in Asia. Indeed, but are
:08:25. > :08:27.deals already been signed between artists and labels that have been
:08:28. > :08:30.successful and fair for everyone? I think that is a struggle. Over the
:08:31. > :08:33.last ten years, since the founding of Napster several years ago, there
:08:34. > :08:40.was quite a bit of playing catch`up within the industry, to make sure
:08:41. > :08:48.all the agreements are in place. Copyright law is quite complex. And
:08:49. > :08:52.making sure the musicians get paid is something that musicians have
:08:53. > :08:55.been very patient in waiting for. And eventually, as these markets
:08:56. > :08:58.mature, it is starting to happen. Indeed, you have the struggle from
:08:59. > :09:03.the musicians, and they are also struggling with piracy, particularly
:09:04. > :09:06.in the Asian market. And Spotify, who we interviewed weeks ago, says
:09:07. > :09:14.piracy has dropped in markets where streaming music has become popular.
:09:15. > :09:21.Do you think this could be a trend, going forward? I think certainly
:09:22. > :09:24.that one of the reasons piracy exists is because of lack of
:09:25. > :09:29.availability of things that people want. The technology exists, but the
:09:30. > :09:33.market place hasn't yet inbuilt. That is one of the reasons we are
:09:34. > :09:37.very optimistic. I understand that 2014 is seen as a year that will be
:09:38. > :09:40.a big year for streaming music in Asia, and as these legitimate
:09:41. > :09:43.marketplace is get up and going, I think consumers will find that if
:09:44. > :09:47.they want to support the artist, it is much easier to do so, and they
:09:48. > :10:00.will. That was Jean Cook from the Future of Music Coalition in New
:10:01. > :10:03.York. And before we go, here is a quick look at the markets. Asian
:10:04. > :10:06.stocks are currently mixed. US stocks ended slightly lower
:10:07. > :10:08.overnight, pressured by a slide in energy share prices, and worries
:10:09. > :10:16.over developments in Russia and Ukraine. You have the Nikkei flat,
:10:17. > :10:22.the Hang Seng also going the same trend. Gaining about 23 points, at
:10:23. > :10:27.the ASX All Ordinaries is lower by 16 points. This is on the back of
:10:28. > :10:32.the Dow Jones industrial average slipping overnight. The NASDAQ,
:10:33. > :10:35.faced with technology issues, in positive territory. Thank you for
:10:36. > :10:51.investing your time with us, I'm Rico Hizon. I am Mike Embley. The
:10:52. > :10:53.top stories this hour: One of Hollywood's great leading ladies,
:10:54. > :10:56.Lauren Bacall, has died the age of 89. The legendary American actress
:10:57. > :11:00.starred alongside Humphrey Bogart in To Have and Have Not and Key Largo.
:11:01. > :11:03.The UN warns of a a tragedy of huge proportions in Northern Iraq. As
:11:04. > :11:04.thousands flee Islamic militants, 130 more American military