28/04/2016 BBC Business Live


Similar Content

Browse content similar to 28/04/2016. Check below for episodes and series from the same categories and more!



This is Business Live from the BBC, with Ben Thompson


Facebook shares hit record highs after profits at the tech giant


Live from London, that's our top story today,


Facebook profits surge as the number of users soars.


We'll assess the results, that have sent shares soaring 10%


The world's biggest advertising company WPP


But does the chief executive, Sir Martin Sorrell, deserve


to be the best paid boss in Britain?


And as American banks opt not to change policy, we ask what is next


to kick-start sluggish American growth.


And imagine if the lift in your office not only


took you up and down, but sideways as well.


We'll be talking to the elevator company which says it is a viable


And as we question WPP boss Sir Martin Sorrell


about his huge pay packet, today we want to know: is any


company boss worth $100 million dollars a year?


the elevator is, it is straight out the elevator is, it is straight out


of Charlie And The Chocolate Factory.


We start in Silicon Valley - where it's been a challenging week


for tech giants including Apple and Twitter.


The world's biggest social network continues to attract


new friends by the millions - and more importantly -


is managing to convert them into profits.


Facebook saw revenue jump more than 50% in the first three months


of the year to over $5.3bn - that's better than Wall Street


That's largely down to booming sales of advertising


But with smaller screens, smartphones have been difficult


But for Facebook, it's seen 82% of its ad revenue now come


The social network has continued to grow and grow.


As of the end of March, 1.65 billion people were logging


That's 200 million people more than this time last yearShares


jumped in after hours trade and if you look at the past three


years you can see the value has steadily climbed from just over


Sarah Wood, Co-Founder and Co-CEO of video ad tech


There were a lot of naysayers about Facebook, how can they get up these


people, how can they monetise them. It looks like they have cracked it?


They have done a great job jumping on two key trends, one of those is


mobile, a massive jump to Mobot consumption, and one is video.


Mobile advertising in video advertising are two of the largest


sectors, and Facebook have converted those into profit. Others are


struggling to do that, I am talking specifically mobile advertising,


that was the key for Facebook. How are they doing it when Twitter


struggles? What Facebook has is massive scale, 1.6 billion users,


many coming back day after day, but it also has data, it is the ability


to target users very precisely by geography, relationship status, and


that really helps. Lets just have a look at how they managed to do it. I


touched on the fact that, on a small touched on the fact that, on a small


screen, we are more easily annoyed by adverts when you are browsing the


things on small screens, and that has been the real shift, how you can


advertise on something that is getting smaller and smaller, and it


seems again, Facebook is doing that right. Consumers are fed up with


interruptive advertising, it is true on large screens and small screens.


What Facebook houses a suite of products that are non-interruptive,


nonintrusive, when the ads play in the news feed, they are not blaring


out, the auto is off, so that is less intrusive, but it can also be


monetised. But if it is less intrusive, does it work for


advertisers? There is always a balance. The challenge for


advertisers is to create great ads that people want to watch and share,


to create a great content and distributed in noninvasive formats


that don't annoy users. Sarah, thank you as always.


WPP, the world's biggest advertising company has announced healthy


trading for the first three months of this year.


Revenues were up some 10% in the three months to March -


slightly flattered by the weak pound but largely thanks to strong


But the numbers have been overshadowed by ongoing controversy


Ir Martin Sorrell is due for a five-year performance


related share award of more than $90 million.


That would make his pay packet this year $101 million dollars.


Electronics giant Samsung says first-quarter profits rose 12%


That's thanks to strong early sales of its new flagship smartphone.


The South Korean firm made $5.8 billion


The new S7 phones were launched in March, and analysts say its price


and a lack of new products from rivals has helped boost sales.


Lloyds Banking Group has announced what it calls a robust fall in


profits. The bank was rescued by the Government at the height of the


financial crisis. The Government has been reducing its stake and now


holds less than 10%. The mission to Mars, we will talk


about that a little later. Elon Mosque has vowed to get more of us


to Mars -- Elon Musk. We are not pointing any fingers!


Deutsche Bank has announced a fall in profits for the first part of the


year, and it is a typical problem, the investment bank has problems.


The investment analyst says 2016 will be a peak year for our


investments. They try to rein add-in to make the bank a little more


profitable. They are telling us to move on. You can check that out on a


life page. Let's talk about the bank of Japan.


The Bank of Japan surprised markets as it held fire on a fresh


round of widely expected stimulus measures, sparking questions


about whether it had anything left in its arsenal to kick start


This was widely expected, but nothing, absolutely nothing from


them today. That is right, and their options are decreasing all the time.


Over the past three years, the bank of Japan has tried pumping millions


of dollars into the economy. In January it went even further by


introducing negative interest rates, and nothing has had its desired


effect yet of used in the country's sagging economy. The central bank


was widely expected this morning to introduce more monetary easing, and


this was seen as even more likely after data came out saying that the


country had fallen back into it deviation. Aneke actually rose on


this news, with investors confident that the bank would act to curb the


falling prices, but on learning that they wouldn't, Nikkei fell, and the


yen also strengthened, so it is not clear what bankers will do.


Charlotte, thank you. You saw it on the screen, but confirmation that of


what that did to the Nikkei stocks. Japanese stocks gave up early gains


and managed to wipe out much of the previous four day rally


after - as we've just heard - the Bank of Japan disappointed


investors by holding off And remember, the Nikkei closed


tomorrow for a national holiday. In Europe, this is how the numbers


are looking at the open. Inheriting the lead from Asia -


as well as the news that the Federal Reserve left


interest rates on hold. We'll pore over the wording


of what we heard from In a moment, but Mariko Oi has


the details about what else is ahead We will find out how the world's


biggest economy performed in the first three months of the year on


Thursday. Originally the expectation was bad, with many economists


forecasting the slowest growth in a year, but some of Wall Street's top


firms have now raised their forecast on Wednesday, and that is because of


the data showing a trade deficit narrowed sharply in March, rather


unexpectedly. What that means is it poses a smaller drag on overall


business activity, and that economy growth may not have been as weak as


anticipated. Which coincides with the Federal reserves and more


optimistic views on the economy. On Thursday we will hear from the likes


of Ford, LinkedIn, Amazon and MasterCard about their forecast.


Joining us is James Hughes, chief market analyst


for at GKFX, a leading online forex trading broker.


James, good to see you. A familiar face to us all. I guess the


headline, if we look at yesterday and the focus from the markets, it


was America's Central bank, it was bank of Japan, the Fed, and also New


Zealand's central-bank, and the headline, central banks do nothing.


We all focus on the Fed is being the most important thing, but arguably


it was Japan that was the most important yesterday. We expected Y20


trillion increase that this already 80 trillion quantitative easing. And


we got absolutely nothing. So it is no surprise we have seen such a big


move in the yen, it strengthened quite a lot. We always moan about


the Fed and the ECB and the tiny amounts that they change the


wording, and that is what they did yesterday. But the reason they do


that is because there are such huge swings in these markets. And the


worry about the global economy, the wider economic Richard, that is


interesting because that has always been the excuse for not doing


anything, and that has now disappeared? And that means we are


going to see some rate hikes in the coming months, because they have in


saying that this global economic downside which has been affecting


the markets, and January, February, sought huge falls in the markets,


but what is interesting is they are saying they have moved away from


affecting the US economy, because they haven't gone anywhere, China is


still struggling economically. Commodities are up, oil is up, but


not as much as we want, so they are struggling, these economies, still,


but they are not affecting the US as much. But it is interesting, because


if the US is sounding more optimistic, it is strange we are


seeing gold, the safe haven... It is because nobody knows what anybody is


doing, that is why gold is rallying! When all else fails, buy gold! We


will talk to you very shortly. We'll hear from a man whose pay


package is almost as big as Aaron's. It's the boss of advertising giant


WPP, Sir Martin Sorrell. We'll ask him whether he's worth


$100 million. The lift - or elevator -


that goes sideways We'll hear from the company


making it a reality. You're with Business Live from BBC


News. The future of the UK's financial


services industry has become a heated battleground for those


arguing whether we should leave But what will the referendum mean


for financial services? Steph McGovern has been to Chepstow


to find out why the race In total, financial services is


worth around ?190 billion to the UK economy, but it is about 12% of


everything we do. So what will taking a punt on EU membership mean


for the financial sector? Let's say I setup my own financial services


company in the UK. Because we are part of the EU, we can do business


easily with the other countries in it. It is called the passport


system. It is why a lot of international


companies will have But the In campaigners


are worried it is at risk. If we were to leave the single


market, negotiate a trade deal along the lines


of countries like Canada, it would exclude financial services,


at great detriment to the UK. And that would mean that a lot


of jobs would be lost, and indeed it would be harder


for us to retain that significant On the other hand, because my


company is in the EU, I have to comply with their rules and


regulations, which have been getting The Out campaigners


say this is a handicap There is an avalanche


of legislation coming out of Brussels weighing down


on our financial services sector Ranging from capital


requirements for insurance companies to restrictions


on accessing talent It makes the UK financial


centre uncompetitive Both sides argue that


the other is gambling with the future of the financial


services industry, but it's anyone's Let's take a look at the tablet.


Greece is back in the spotlight again, just when we thought it was


safe to look away. This is Donald Tusk, the boss of the European


Council. He is tweeting about the importance of renewed talks. Clearly


a lot of worries ahead of the UK's referendum on Europe, any worries


over Greece will be very closely watched.


top story. Facebook told us last night that the revenue has tripled,


because of mobile advertising, we have talked about it a lot on this


programme, why it is difficult to make money from mobile adverts


although from these figures it would seem that Facebook has cracked it.


Imagine if the lift in your office or apartment building not only


took you up and down - but sideways as well -


whisking you to the far corners of the building.


It's an idea one company is testing and says it is possible.


ThyssenKrupp Elevator has been making lifts


since the 1970s, its HQ is in Germany and has 50-thousand


a year, its projects have included the One World Trade Centre in


Its chief executive is Andreas Schierenbeck -


who also holds a degree in electrical engineering.


Andreas, welcome. The producer will show the images, it is hard for us


to get our heads around it, the technology exists? Yes, you can see


it in our test centre in Spain, we are just building a tower in Germany


to install this project by the end of this year or next spring. Why


hasn't it happened before, we have seen it in films, left that could go


in any direction, something people have wanted for a long time, what is


not made it possible before? Maybe it was possible, just not needed. We


can lift higher and higher although the left cannot follow. We needed


new technology to really rich lifts into a level of 3000 metres and of


course to put more cabins in a shaft. So this was driving the


research. There has to be another way to make it more efficient and


better. Amazing images. In 2016 it is rather archaic to hear about


lifts, still on cables to this day. And that has always been a hindrance


on how high you can go. We keep talking about it, skyscrapers, going


up and up. The cable is a thing that has been working for a long time,


although it has definitely two setbacks, first if you have a cable,


it's only one thing moving, and the other hand the cable cannot be as


long as you wish. It can go up to 600 metres and then becoming too


buried to bear the load. So getting rid of the cable is a key part to


drive the technology, it's an enormous thing to do. So what is the


technology that means that you could do this either higher or go in


different directions? The change was that we would get rid of the cable,


if you put magnets, and linear motor on the wall and of course the linear


motor is propelling the cabin to where ever you want to go. And since


you have multiple cabins they have to go somewhere if they hit the end


of the shaft so we move them sideways and bring them down a


second shaft. This makes me feel a little sick! What users would you


have? We talked about office buildings and sprawling sites, where


would it be used? A lot of interest from buildings which are high and


want to have less elevator shafts because real estate prices are high,


I'm talking to you in London, come on! If you have vertical and


horizontal transportation together, going from a parking place in an


airport, directly to the check-in terminal results, changing lifts,


people flow is the top priority of a lot of industries. As the big boss


of the group... Has building always been in your


blood? I worked in the builders differ ten years and then I changed


to buildings because they are fascinating. You take so much for


granted, you switch on your tap water, how does the tap water come


there? How do you get cooling and fire protection, how do you get


upstairs that an elevator, there is such interesting stuff, normally


engineers like Beck and complexes so I like to do that. Andreas, I said


it would be short and sweet, we really appreciated and we hope this


technology gives your company left! Andreas, danke schon.


WPP is the world's biggest advertising company.


In the last hour or so it has announced healthy trading


for the first three months of this year.


Revenues were up some 10% in the three months to March -


slightly flattered by the weak pound but largely thanks to strong


But the numbers are really overshadowed by ongoing


Sir Martin Sorrell is due for a five year performance related share award


That would make his pay packet this year to 101 million dollars


Earlier I spoke to Sir Martin Sorrell


from New York and I asked him if he was worth that amount?


What I have been doing for over 31 years is investing in the company,


never selling shares, always reinvesting. So what you referred


to, the annual report will be out tomorrow and it will confirm the


numbers you talk about, I have kept investing after tax, all of the


amount. So all of my wealth such as it is, is invested in this company.


It's something that my father encouraged me to do many years ago.


He said that portfolio investment was a mugs game and you should


invest in the company you know best, the one that you are in. Will the


shareholders approve? Approve of your pay packet? That is up to the


shareholders. The incentive plan you referred to, they did approve, many


years ago. It was something like 70% or 80% of them proving that plan.


The answer to the question is, when it was put to shareholders for


approval, and every one of our plans has been put up to shareholders for


approval, they were approved. Shareholders can change their mind


but the answer to your question is, they had the chance to vote on it


and they voted in favour. The performance of the company over the


last five years has gone from a market cap of eight and a half


billion pounds to ?20 billion and we have outperformed all the indices


and all our peers because the plan itself was based on that


outperformance. So I am not embarrassed by the performance of


the company, or apologising for the fact that this company is a world


leader and is based in the UK and we are very proud of the fact that we


started at 31 years ago from nothing and it is where it is now. He is a


good talker. There's a lot of controversy about why he is paid so


much but as he says, she built the company from scratch, 31 years ago,


he's been a long time, seen it through the good and about and who


else would the money? Meijer we always argue about shareholder


activism and how much the chief executive should be paid but it is


his company and he built it from scratch. He's almost changed a


generation of advertising and what the company does. Some people do not


deserve massive pay packets when the company doesn't do well. Clearly the


company is making a big loss, in that case, hugely successful and he


gets paid for it. There is a programme in place. And he is


brilliant on TV! He's a really good talker, we always have fun with him.


You mentioned Greece. This is interesting, it's the same old story


and it just rolls on. You've got the IMF and the EU and the European


Central Bank, who lent money to Greece, they are at loggerheads,


Greece cannot pay back all the money. We said this in 2015 and in


2014 and in 2011 and we continue lending! Will probably say this in


July. Donald Tusk has called a meeting to try to organise this.


Greece bow to .2 euros billion to the European Central Bank in July.


-- they owe this money. We know that the talks will go on and on and we


reach a deadline which will be pushed back. It's just the same


thing again. And a word on the timing just before the UK referendum


on the afford your Mac, that'll be interesting because the suggestion


was that nobody would rock the boat until the referendum was done. This


could throw a spanner in the works, it could raise important questions


about the future of the U before the referendum. It could, and what will


also come from the Leave campaign is, we know that the UK isn't part


of the Eurozone, although it is still money from the UK that goes to


Greece. That will be the big thing, when these figures are highlighted.


Not a lot but sum. We are out of time. Thank you for coming in. Have


a great day, wherever you are, we will see a very soon.


Download Subtitles