:00:00. > :00:10.This is Business Live from the BBC, with Ben Thompson
:00:11. > :00:18.Facebook shares hit record highs after profits at the tech giant
:00:19. > :00:22.Live from London, that's our top story today,
:00:23. > :00:41.Facebook profits surge as the number of users soars.
:00:42. > :00:46.We'll assess the results, that have sent shares soaring 10%
:00:47. > :00:53.The world's biggest advertising company WPP
:00:54. > :00:59.But does the chief executive, Sir Martin Sorrell, deserve
:01:00. > :01:03.to be the best paid boss in Britain?
:01:04. > :01:08.And as American banks opt not to change policy, we ask what is next
:01:09. > :01:11.to kick-start sluggish American growth.
:01:12. > :01:14.And imagine if the lift in your office not only
:01:15. > :01:16.took you up and down, but sideways as well.
:01:17. > :01:19.We'll be talking to the elevator company which says it is a viable
:01:20. > :01:27.And as we question WPP boss Sir Martin Sorrell
:01:28. > :01:30.about his huge pay packet, today we want to know: is any
:01:31. > :01:32.company boss worth $100 million dollars a year?
:01:33. > :01:58.the elevator is, it is straight out the elevator is, it is straight out
:01:59. > :02:01.of Charlie And The Chocolate Factory.
:02:02. > :02:04.We start in Silicon Valley - where it's been a challenging week
:02:05. > :02:05.for tech giants including Apple and Twitter.
:02:06. > :02:08.The world's biggest social network continues to attract
:02:09. > :02:11.new friends by the millions - and more importantly -
:02:12. > :02:12.is managing to convert them into profits.
:02:13. > :02:15.Facebook saw revenue jump more than 50% in the first three months
:02:16. > :02:20.of the year to over $5.3bn - that's better than Wall Street
:02:21. > :02:24.That's largely down to booming sales of advertising
:02:25. > :02:30.But with smaller screens, smartphones have been difficult
:02:31. > :02:34.But for Facebook, it's seen 82% of its ad revenue now come
:02:35. > :02:49.The social network has continued to grow and grow.
:02:50. > :02:52.As of the end of March, 1.65 billion people were logging
:02:53. > :02:55.That's 200 million people more than this time last yearShares
:02:56. > :02:59.jumped in after hours trade and if you look at the past three
:03:00. > :03:06.years you can see the value has steadily climbed from just over
:03:07. > :03:10.Sarah Wood, Co-Founder and Co-CEO of video ad tech
:03:11. > :03:23.There were a lot of naysayers about Facebook, how can they get up these
:03:24. > :03:28.people, how can they monetise them. It looks like they have cracked it?
:03:29. > :03:32.They have done a great job jumping on two key trends, one of those is
:03:33. > :03:36.mobile, a massive jump to Mobot consumption, and one is video.
:03:37. > :03:40.Mobile advertising in video advertising are two of the largest
:03:41. > :03:46.sectors, and Facebook have converted those into profit. Others are
:03:47. > :03:48.struggling to do that, I am talking specifically mobile advertising,
:03:49. > :03:56.that was the key for Facebook. How are they doing it when Twitter
:03:57. > :04:00.struggles? What Facebook has is massive scale, 1.6 billion users,
:04:01. > :04:07.many coming back day after day, but it also has data, it is the ability
:04:08. > :04:11.to target users very precisely by geography, relationship status, and
:04:12. > :04:14.that really helps. Lets just have a look at how they managed to do it. I
:04:15. > :04:18.touched on the fact that, on a small touched on the fact that, on a small
:04:19. > :04:22.screen, we are more easily annoyed by adverts when you are browsing the
:04:23. > :04:26.things on small screens, and that has been the real shift, how you can
:04:27. > :04:29.advertise on something that is getting smaller and smaller, and it
:04:30. > :04:34.seems again, Facebook is doing that right. Consumers are fed up with
:04:35. > :04:38.interruptive advertising, it is true on large screens and small screens.
:04:39. > :04:42.What Facebook houses a suite of products that are non-interruptive,
:04:43. > :04:47.nonintrusive, when the ads play in the news feed, they are not blaring
:04:48. > :04:51.out, the auto is off, so that is less intrusive, but it can also be
:04:52. > :04:56.monetised. But if it is less intrusive, does it work for
:04:57. > :04:58.advertisers? There is always a balance. The challenge for
:04:59. > :05:04.advertisers is to create great ads that people want to watch and share,
:05:05. > :05:08.to create a great content and distributed in noninvasive formats
:05:09. > :05:10.that don't annoy users. Sarah, thank you as always.
:05:11. > :05:14.WPP, the world's biggest advertising company has announced healthy
:05:15. > :05:23.trading for the first three months of this year.
:05:24. > :05:26.Revenues were up some 10% in the three months to March -
:05:27. > :05:28.slightly flattered by the weak pound but largely thanks to strong
:05:29. > :05:31.But the numbers have been overshadowed by ongoing controversy
:05:32. > :05:41.Ir Martin Sorrell is due for a five-year performance
:05:42. > :05:43.related share award of more than $90 million.
:05:44. > :05:47.That would make his pay packet this year $101 million dollars.
:05:48. > :05:49.Electronics giant Samsung says first-quarter profits rose 12%
:05:50. > :05:57.That's thanks to strong early sales of its new flagship smartphone.
:05:58. > :05:59.The South Korean firm made $5.8 billion
:06:00. > :06:05.The new S7 phones were launched in March, and analysts say its price
:06:06. > :06:14.and a lack of new products from rivals has helped boost sales.
:06:15. > :06:24.Lloyds Banking Group has announced what it calls a robust fall in
:06:25. > :06:29.profits. The bank was rescued by the Government at the height of the
:06:30. > :06:36.financial crisis. The Government has been reducing its stake and now
:06:37. > :06:41.holds less than 10%. The mission to Mars, we will talk
:06:42. > :06:52.about that a little later. Elon Mosque has vowed to get more of us
:06:53. > :07:01.to Mars -- Elon Musk. We are not pointing any fingers!
:07:02. > :07:10.Deutsche Bank has announced a fall in profits for the first part of the
:07:11. > :07:14.year, and it is a typical problem, the investment bank has problems.
:07:15. > :07:24.The investment analyst says 2016 will be a peak year for our
:07:25. > :07:27.investments. They try to rein add-in to make the bank a little more
:07:28. > :07:35.profitable. They are telling us to move on. You can check that out on a
:07:36. > :07:37.life page. Let's talk about the bank of Japan.
:07:38. > :07:40.The Bank of Japan surprised markets as it held fire on a fresh
:07:41. > :07:42.round of widely expected stimulus measures, sparking questions
:07:43. > :07:45.about whether it had anything left in its arsenal to kick start
:07:46. > :08:05.This was widely expected, but nothing, absolutely nothing from
:08:06. > :08:08.them today. That is right, and their options are decreasing all the time.
:08:09. > :08:13.Over the past three years, the bank of Japan has tried pumping millions
:08:14. > :08:16.of dollars into the economy. In January it went even further by
:08:17. > :08:19.introducing negative interest rates, and nothing has had its desired
:08:20. > :08:24.effect yet of used in the country's sagging economy. The central bank
:08:25. > :08:29.was widely expected this morning to introduce more monetary easing, and
:08:30. > :08:32.this was seen as even more likely after data came out saying that the
:08:33. > :08:37.country had fallen back into it deviation. Aneke actually rose on
:08:38. > :08:42.this news, with investors confident that the bank would act to curb the
:08:43. > :08:56.falling prices, but on learning that they wouldn't, Nikkei fell, and the
:08:57. > :09:02.yen also strengthened, so it is not clear what bankers will do.
:09:03. > :09:03.Charlotte, thank you. You saw it on the screen, but confirmation that of
:09:04. > :09:07.what that did to the Nikkei stocks. Japanese stocks gave up early gains
:09:08. > :09:13.and managed to wipe out much of the previous four day rally
:09:14. > :09:16.after - as we've just heard - the Bank of Japan disappointed
:09:17. > :09:18.investors by holding off And remember, the Nikkei closed
:09:19. > :09:21.tomorrow for a national holiday. In Europe, this is how the numbers
:09:22. > :09:26.are looking at the open. Inheriting the lead from Asia -
:09:27. > :09:29.as well as the news that the Federal Reserve left
:09:30. > :09:31.interest rates on hold. We'll pore over the wording
:09:32. > :09:35.of what we heard from In a moment, but Mariko Oi has
:09:36. > :09:46.the details about what else is ahead We will find out how the world's
:09:47. > :09:50.biggest economy performed in the first three months of the year on
:09:51. > :09:53.Thursday. Originally the expectation was bad, with many economists
:09:54. > :09:58.forecasting the slowest growth in a year, but some of Wall Street's top
:09:59. > :10:01.firms have now raised their forecast on Wednesday, and that is because of
:10:02. > :10:06.the data showing a trade deficit narrowed sharply in March, rather
:10:07. > :10:12.unexpectedly. What that means is it poses a smaller drag on overall
:10:13. > :10:15.business activity, and that economy growth may not have been as weak as
:10:16. > :10:22.anticipated. Which coincides with the Federal reserves and more
:10:23. > :10:28.optimistic views on the economy. On Thursday we will hear from the likes
:10:29. > :10:31.of Ford, LinkedIn, Amazon and MasterCard about their forecast.
:10:32. > :10:33.Joining us is James Hughes, chief market analyst
:10:34. > :10:35.for at GKFX, a leading online forex trading broker.
:10:36. > :10:42.James, good to see you. A familiar face to us all. I guess the
:10:43. > :10:47.headline, if we look at yesterday and the focus from the markets, it
:10:48. > :10:52.was America's Central bank, it was bank of Japan, the Fed, and also New
:10:53. > :10:57.Zealand's central-bank, and the headline, central banks do nothing.
:10:58. > :11:00.We all focus on the Fed is being the most important thing, but arguably
:11:01. > :11:07.it was Japan that was the most important yesterday. We expected Y20
:11:08. > :11:14.trillion increase that this already 80 trillion quantitative easing. And
:11:15. > :11:17.we got absolutely nothing. So it is no surprise we have seen such a big
:11:18. > :11:25.move in the yen, it strengthened quite a lot. We always moan about
:11:26. > :11:28.the Fed and the ECB and the tiny amounts that they change the
:11:29. > :11:33.wording, and that is what they did yesterday. But the reason they do
:11:34. > :11:38.that is because there are such huge swings in these markets. And the
:11:39. > :11:41.worry about the global economy, the wider economic Richard, that is
:11:42. > :11:45.interesting because that has always been the excuse for not doing
:11:46. > :11:50.anything, and that has now disappeared? And that means we are
:11:51. > :11:55.going to see some rate hikes in the coming months, because they have in
:11:56. > :11:59.saying that this global economic downside which has been affecting
:12:00. > :12:03.the markets, and January, February, sought huge falls in the markets,
:12:04. > :12:06.but what is interesting is they are saying they have moved away from
:12:07. > :12:11.affecting the US economy, because they haven't gone anywhere, China is
:12:12. > :12:16.still struggling economically. Commodities are up, oil is up, but
:12:17. > :12:21.not as much as we want, so they are struggling, these economies, still,
:12:22. > :12:25.but they are not affecting the US as much. But it is interesting, because
:12:26. > :12:31.if the US is sounding more optimistic, it is strange we are
:12:32. > :12:34.seeing gold, the safe haven... It is because nobody knows what anybody is
:12:35. > :12:38.doing, that is why gold is rallying! When all else fails, buy gold! We
:12:39. > :12:41.will talk to you very shortly. We'll hear from a man whose pay
:12:42. > :12:46.package is almost as big as Aaron's. It's the boss of advertising giant
:12:47. > :12:48.WPP, Sir Martin Sorrell. We'll ask him whether he's worth
:12:49. > :12:52.$100 million. The lift - or elevator -
:12:53. > :12:56.that goes sideways We'll hear from the company
:12:57. > :13:01.making it a reality. You're with Business Live from BBC
:13:02. > :13:10.News. The future of the UK's financial
:13:11. > :13:13.services industry has become a heated battleground for those
:13:14. > :13:15.arguing whether we should leave But what will the referendum mean
:13:16. > :13:23.for financial services? Steph McGovern has been to Chepstow
:13:24. > :13:41.to find out why the race In total, financial services is
:13:42. > :13:46.worth around ?190 billion to the UK economy, but it is about 12% of
:13:47. > :13:51.everything we do. So what will taking a punt on EU membership mean
:13:52. > :13:55.for the financial sector? Let's say I setup my own financial services
:13:56. > :13:58.company in the UK. Because we are part of the EU, we can do business
:13:59. > :14:00.easily with the other countries in it. It is called the passport
:14:01. > :14:08.system. It is why a lot of international
:14:09. > :14:11.companies will have But the In campaigners
:14:12. > :14:15.are worried it is at risk. If we were to leave the single
:14:16. > :14:17.market, negotiate a trade deal along the lines
:14:18. > :14:20.of countries like Canada, it would exclude financial services,
:14:21. > :14:22.at great detriment to the UK. And that would mean that a lot
:14:23. > :14:25.of jobs would be lost, and indeed it would be harder
:14:26. > :14:28.for us to retain that significant On the other hand, because my
:14:29. > :14:33.company is in the EU, I have to comply with their rules and
:14:34. > :14:35.regulations, which have been getting The Out campaigners
:14:36. > :14:39.say this is a handicap There is an avalanche
:14:40. > :14:43.of legislation coming out of Brussels weighing down
:14:44. > :14:46.on our financial services sector Ranging from capital
:14:47. > :14:51.requirements for insurance companies to restrictions
:14:52. > :14:53.on accessing talent It makes the UK financial
:14:54. > :14:57.centre uncompetitive Both sides argue that
:14:58. > :15:08.the other is gambling with the future of the financial
:15:09. > :15:24.services industry, but it's anyone's Let's take a look at the tablet.
:15:25. > :15:29.Greece is back in the spotlight again, just when we thought it was
:15:30. > :15:33.safe to look away. This is Donald Tusk, the boss of the European
:15:34. > :15:40.Council. He is tweeting about the importance of renewed talks. Clearly
:15:41. > :15:43.a lot of worries ahead of the UK's referendum on Europe, any worries
:15:44. > :15:53.over Greece will be very closely watched.
:15:54. > :16:05.top story. Facebook told us last night that the revenue has tripled,
:16:06. > :16:11.because of mobile advertising, we have talked about it a lot on this
:16:12. > :16:14.programme, why it is difficult to make money from mobile adverts
:16:15. > :16:17.although from these figures it would seem that Facebook has cracked it.
:16:18. > :16:20.Imagine if the lift in your office or apartment building not only
:16:21. > :16:23.took you up and down - but sideways as well -
:16:24. > :16:28.whisking you to the far corners of the building.
:16:29. > :16:31.It's an idea one company is testing and says it is possible.
:16:32. > :16:33.ThyssenKrupp Elevator has been making lifts
:16:34. > :16:35.since the 1970s, its HQ is in Germany and has 50-thousand
:16:36. > :16:44.a year, its projects have included the One World Trade Centre in
:16:45. > :16:48.Its chief executive is Andreas Schierenbeck -
:16:49. > :16:50.who also holds a degree in electrical engineering.
:16:51. > :17:07.Andreas, welcome. The producer will show the images, it is hard for us
:17:08. > :17:15.to get our heads around it, the technology exists? Yes, you can see
:17:16. > :17:19.it in our test centre in Spain, we are just building a tower in Germany
:17:20. > :17:26.to install this project by the end of this year or next spring. Why
:17:27. > :17:30.hasn't it happened before, we have seen it in films, left that could go
:17:31. > :17:36.in any direction, something people have wanted for a long time, what is
:17:37. > :17:40.not made it possible before? Maybe it was possible, just not needed. We
:17:41. > :17:46.can lift higher and higher although the left cannot follow. We needed
:17:47. > :17:51.new technology to really rich lifts into a level of 3000 metres and of
:17:52. > :17:55.course to put more cabins in a shaft. So this was driving the
:17:56. > :18:02.research. There has to be another way to make it more efficient and
:18:03. > :18:08.better. Amazing images. In 2016 it is rather archaic to hear about
:18:09. > :18:14.lifts, still on cables to this day. And that has always been a hindrance
:18:15. > :18:22.on how high you can go. We keep talking about it, skyscrapers, going
:18:23. > :18:27.up and up. The cable is a thing that has been working for a long time,
:18:28. > :18:32.although it has definitely two setbacks, first if you have a cable,
:18:33. > :18:37.it's only one thing moving, and the other hand the cable cannot be as
:18:38. > :18:41.long as you wish. It can go up to 600 metres and then becoming too
:18:42. > :18:47.buried to bear the load. So getting rid of the cable is a key part to
:18:48. > :18:51.drive the technology, it's an enormous thing to do. So what is the
:18:52. > :18:55.technology that means that you could do this either higher or go in
:18:56. > :19:01.different directions? The change was that we would get rid of the cable,
:19:02. > :19:04.if you put magnets, and linear motor on the wall and of course the linear
:19:05. > :19:08.motor is propelling the cabin to where ever you want to go. And since
:19:09. > :19:12.you have multiple cabins they have to go somewhere if they hit the end
:19:13. > :19:19.of the shaft so we move them sideways and bring them down a
:19:20. > :19:22.second shaft. This makes me feel a little sick! What users would you
:19:23. > :19:28.have? We talked about office buildings and sprawling sites, where
:19:29. > :19:33.would it be used? A lot of interest from buildings which are high and
:19:34. > :19:36.want to have less elevator shafts because real estate prices are high,
:19:37. > :19:41.I'm talking to you in London, come on! If you have vertical and
:19:42. > :19:45.horizontal transportation together, going from a parking place in an
:19:46. > :19:52.airport, directly to the check-in terminal results, changing lifts,
:19:53. > :19:57.people flow is the top priority of a lot of industries. As the big boss
:19:58. > :20:17.of the group... Has building always been in your
:20:18. > :20:20.blood? I worked in the builders differ ten years and then I changed
:20:21. > :20:24.to buildings because they are fascinating. You take so much for
:20:25. > :20:29.granted, you switch on your tap water, how does the tap water come
:20:30. > :20:33.there? How do you get cooling and fire protection, how do you get
:20:34. > :20:38.upstairs that an elevator, there is such interesting stuff, normally
:20:39. > :20:43.engineers like Beck and complexes so I like to do that. Andreas, I said
:20:44. > :20:53.it would be short and sweet, we really appreciated and we hope this
:20:54. > :20:57.technology gives your company left! Andreas, danke schon.
:20:58. > :20:59.WPP is the world's biggest advertising company.
:21:00. > :21:01.In the last hour or so it has announced healthy trading
:21:02. > :21:07.for the first three months of this year.
:21:08. > :21:10.Revenues were up some 10% in the three months to March -
:21:11. > :21:12.slightly flattered by the weak pound but largely thanks to strong
:21:13. > :21:15.But the numbers are really overshadowed by ongoing
:21:16. > :21:22.Sir Martin Sorrell is due for a five year performance related share award
:21:23. > :21:26.That would make his pay packet this year to 101 million dollars
:21:27. > :21:28.Earlier I spoke to Sir Martin Sorrell
:21:29. > :21:32.from New York and I asked him if he was worth that amount?
:21:33. > :21:38.What I have been doing for over 31 years is investing in the company,
:21:39. > :21:44.never selling shares, always reinvesting. So what you referred
:21:45. > :21:47.to, the annual report will be out tomorrow and it will confirm the
:21:48. > :21:55.numbers you talk about, I have kept investing after tax, all of the
:21:56. > :21:58.amount. So all of my wealth such as it is, is invested in this company.
:21:59. > :22:04.It's something that my father encouraged me to do many years ago.
:22:05. > :22:07.He said that portfolio investment was a mugs game and you should
:22:08. > :22:16.invest in the company you know best, the one that you are in. Will the
:22:17. > :22:22.shareholders approve? Approve of your pay packet? That is up to the
:22:23. > :22:29.shareholders. The incentive plan you referred to, they did approve, many
:22:30. > :22:34.years ago. It was something like 70% or 80% of them proving that plan.
:22:35. > :22:38.The answer to the question is, when it was put to shareholders for
:22:39. > :22:42.approval, and every one of our plans has been put up to shareholders for
:22:43. > :22:46.approval, they were approved. Shareholders can change their mind
:22:47. > :22:50.but the answer to your question is, they had the chance to vote on it
:22:51. > :22:53.and they voted in favour. The performance of the company over the
:22:54. > :22:58.last five years has gone from a market cap of eight and a half
:22:59. > :23:03.billion pounds to ?20 billion and we have outperformed all the indices
:23:04. > :23:06.and all our peers because the plan itself was based on that
:23:07. > :23:11.outperformance. So I am not embarrassed by the performance of
:23:12. > :23:15.the company, or apologising for the fact that this company is a world
:23:16. > :23:19.leader and is based in the UK and we are very proud of the fact that we
:23:20. > :23:26.started at 31 years ago from nothing and it is where it is now. He is a
:23:27. > :23:31.good talker. There's a lot of controversy about why he is paid so
:23:32. > :23:36.much but as he says, she built the company from scratch, 31 years ago,
:23:37. > :23:41.he's been a long time, seen it through the good and about and who
:23:42. > :23:44.else would the money? Meijer we always argue about shareholder
:23:45. > :23:47.activism and how much the chief executive should be paid but it is
:23:48. > :23:53.his company and he built it from scratch. He's almost changed a
:23:54. > :23:59.generation of advertising and what the company does. Some people do not
:24:00. > :24:07.deserve massive pay packets when the company doesn't do well. Clearly the
:24:08. > :24:13.company is making a big loss, in that case, hugely successful and he
:24:14. > :24:18.gets paid for it. There is a programme in place. And he is
:24:19. > :24:25.brilliant on TV! He's a really good talker, we always have fun with him.
:24:26. > :24:31.You mentioned Greece. This is interesting, it's the same old story
:24:32. > :24:35.and it just rolls on. You've got the IMF and the EU and the European
:24:36. > :24:38.Central Bank, who lent money to Greece, they are at loggerheads,
:24:39. > :24:45.Greece cannot pay back all the money. We said this in 2015 and in
:24:46. > :24:52.2014 and in 2011 and we continue lending! Will probably say this in
:24:53. > :24:59.July. Donald Tusk has called a meeting to try to organise this.
:25:00. > :25:04.Greece bow to .2 euros billion to the European Central Bank in July.
:25:05. > :25:08.-- they owe this money. We know that the talks will go on and on and we
:25:09. > :25:12.reach a deadline which will be pushed back. It's just the same
:25:13. > :25:17.thing again. And a word on the timing just before the UK referendum
:25:18. > :25:20.on the afford your Mac, that'll be interesting because the suggestion
:25:21. > :25:24.was that nobody would rock the boat until the referendum was done. This
:25:25. > :25:29.could throw a spanner in the works, it could raise important questions
:25:30. > :25:35.about the future of the U before the referendum. It could, and what will
:25:36. > :25:39.also come from the Leave campaign is, we know that the UK isn't part
:25:40. > :25:44.of the Eurozone, although it is still money from the UK that goes to
:25:45. > :25:49.Greece. That will be the big thing, when these figures are highlighted.
:25:50. > :26:00.Not a lot but sum. We are out of time. Thank you for coming in. Have
:26:01. > :26:02.a great day, wherever you are, we will see a very soon.