19/07/2016 BBC Business Live


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This is Business Live from BBC News, with Ben Bland and Sally Bundock.


No buyer and the losses are widening -


so what now for Yahoo as it attempts to woo bidders


Live from London, that's our top story


Yahoo has been courting buyers for its core internet


business for months, but investors will have to wait


a little bit longer for details of a potential deal.


We'll guide you through the highs and lows of


Shares in Japan's Softbank fall after it announces a $32 billion


offer for chip designer ARM holdings.


We'll cross over to Asia for the latest.


The European markets all opening slightly down, tracking losses


overnight from most of the Asian markets. That Softbank slide in


shares, a tempest and fall, though Nintendo doing pretty well on the


success of its Pokemon Go game. One man's trash is


another man's treasure! Later in the programme,


we'll speak to the boss of a company that helps businesses recycle


their furniture and fittings. From one technology


pioneer to another. We've spoken about Yahoo


but the streaming service Netflix also reported


disappointing numbers - apparently subscribers are not happy


with the price increase. We want to know, are you switching


from Netflix? If so, to whom and why? Get in touch using the hashtag


on-screen. The internet firm Yahoo


saw its losses widen to $440 million in the three months


to the end of June. This was expected but investors


were hoping for an update on the company's plans


to sell its core search and On that subject, Yahoo


revealed nothing. Over the years, shareholders have


had a roller-coaster ride. Yahoo's chief executive, Marissa


Mayer, was appointed in 2012. It was hoped that she'd revive


the business's fortunes. Acquisitions were Ms


Mayer's weapon of choice. Since her appointment, Yahoo has


bought more than 45 companies, including the micro-blogging website


Tumblr, for $1.1 billion. In the two years after she took


over, Yahoo's share But in 2014, things


started to change. The company's share price took


a tumble after the Chinese retailing Yahoo owns a massive 15% stake


in the business, so when Alibaba's shares began to sink,


it took Yahoo down with it. So Yahoo's next plan


of action was to sell This move was announced earlier this


year, with several big tech names But still no news


of a concrete offer. With me now is Richard Kramer,


senior analyst and founder of London-based equity research firm


Arete Research. What do you make of the fact there


is no news? It's not surprising because it's a long sale process


that they've been undergoing. What we saw last night was the


fundamentals of the business continuing to deteriorate, the sales


down 20%, paid clicks down 24 present, with perhaps the only


bright spot that Yahoo managed to bright spot that Yahoo managed to


sell some assets like real estate and get a large refund. It is not


great when you are trying to sell your core assets that your numbers


keep going through during the discussion process with, let's say,


AT authorising? In some ways, it is better that the poor numbers are


in the market. It brings price down. It is not good for Marissa Mayer or


those who are trying to sell. Those who are looking at this asset, for


all the years of effort to boot a new business inside Yahoo from their


declining legacy businesses would be under no illusions whatsoever about


the state of business. Nasty write-downs after the purchase,


that's what you mean? In a way, so that is clearing the decks to make


it easier for an acquiring not to have to do those same things. One of


the other things Yahoo announced was that they had counted for about 20%


over the last 12 months. -- their head count had fallen. If the new


acquirer takes over, they may have to let people go so it is easy if


Yahoo does that. Where did they go wrong? Is there anything you think


they could have done differently to be in a better position? You have to


go back many years but the reality in the internet space right now is


that two companies are effectively sucking all the oxygen out of the


room, Facebook and Google. This year Facebook will spend more on R than


Yahoo has in sales and Google twice to three times as much, so, like


many markets, you see that there are a couple of dominant players that


are merged and those that are not able to keep up with the pace or get


embroiled, as Yahoo did, in internal squabbles, get left behind. So the


outlook for Yahoo, it will sell its core assets, we assume that will


happen, and if so who do you think the likely buyer will because aurora


number of interested parties, two large US telcos, the rise in and


AT The real question now is whether Yahoo will just sell its


call on whether someone will make a bid for the entire property, which


includes stakes in other companies, and try to mitigate the tax


liability with other assets they might have. We shall watch every


twist and turned it off thank you for coming in and giving us your


take on the very latest. Let's take a good some other stories... -- a


look at. Shares in the web streaming


giant Netflix have fallen in after-hour trading,


after the firm said it added fewer The company signed up 1.7 million


new customers in the three months to the end of June -


well short of the 2.5 The firm has blamed


the disappointing performance on cancellations by customers


facing a price increase. Fiat Chrysler is being investigated


by US regulators over the way it reports quarterly


and annual results. The company says it records revenues


based on shipments to dealers, rather than direct sales


to car buyers. Fiat Chrysler recorded a 7% rise


in its monthly sales in June - its best result for that month


since 2005. The former UK finance minister,


Chancellor George Osborne, has given a speech outlining the philosophy


underpinning his time at the Treasury. The speech is seen by some


as an attempt to defend his record, perhaps pointing to his desire to


return to front line politics in the future.


A story dominating our web page today is this one about BT, the main


phone line operator in the UK. MPs are warning BT faces having to split


up unless it sorts out its Openreach division, which is responsible for


rolling out superfast broadband across the UK. How this is operated


and how it is provided in this country has been looked into by


politicians. The MPs say they want more transparency and service


improvements. They conclude that BT is significantly under investing in


Openreach. Lots more information on that online. Let's talk about a


story that first came to our attention this time yesterday, that


being Softbank of Japan snapping up a RM holdings of the UK.


Sarah Toms is in Singapore and has been following the story.


Hello. It was one of the biggest steals of the year and it came on a


public holiday in Japan, so today Japanese investors have had their


first chance to react to the news and they're questioning ARM's hefty


$32 billion priced at. Shares in the Japanese tech and telecoms company


plunged a whopping 10% today and ARM is the crown jewel of the UK tech


industry, so what's the problem? Softbank is already $100 billion in


debt and this purchase is piling on even more. The company has raised


some cash over the past few months and disposed of some of its assets,


like its stake in Ali baba. Many analysts had been hoping this would


be used to reduce some of that debt but instead it has gone to pay for


this acquisition and, if the company's going to spend that much


on an investment, it had better start paying off soon.


moment. We going to try to show you moment. We going to try to show you


how the markets start the morning on Tuesday but our systems have been


playing up. I was hoping they're going to appear but unfortunately


not. Let me tell you, though, all European markets are opening


slightly down, tracking losses from Asia. Most of the markets in Asia


ending their trading day down, although the Nick Cave being buoyed


off the back of the success of off the back of the success of


Pokemon Go, the game that seems to have taken everyone's attention. We


will be looking ahead to what is on Wall Street.


And Michelle Fleury has the details about what's ahead


Wall Street is poised for more bank earnings. Colburn sucks aboard


profits this Tuesday and is expected to do well, helped in part by


improved trading activity, thanks to the Brexit vote on the volatility we


saw in the financial markets. So far the results on the big banks have


been better than expected after a very weak start of the year.


Microsoft will offer a glimpse into another corner of the economy, the


tech sector. Growth in its cloud business is likely to offset the


continuing slide in PC sales. PCs often come preloaded with windows


operating system. And Johnson Johnson is likely to see profits


boosted by its drugs business. One unknown, though, this corporate


earnings season is what is the impact of foreign exchange rates?


They've been fairly volatile since the Brexit vote. Given the strong


dollar, will that hurt revenue growth?


That's Michelle in New York and we are joined by Richard Fletcher,


business editor of the Times. Most see you. Great to have a human


being. The technology is falling around us! -- nice to see you. Then


touching on Softbank, as was Sarah in Singapore. It is quite


phenomenal, this story, but no surprise the shares are down for


Softbank. Japanese markets closed yesterday as the news leaked out


overnight, so this was the first chance for Japanese investors to


give their verdict. The fall in the share price is not so much about the


deal but about the fact that in recent months, Softbank has sold a


number of assets, a stake in Ali baba, other assets, raised a lot of


cash and shareholders had rather been hoping that some of that would


go back to them and some of it would go to pay off some of Softbank's


debts so I think this share price fall is not a verdict on the deal


but about disappointment they are not going to get some of that money


back and rather than decreasing its debts, it looks like Softbank is


going to add to them. We saw most of the Asian markets closing down at


the end of the trading day, though the Nick Haig up, seeming to be


pushed upwards by the success of Nintendo and the almost unstoppable


march of Pokemon, Crowe go. A quarter of the shares posted on the


Tokyo board were Nintendo shares. It has been an amazing few weeks for


Nintendo. If you have kids my age, you will know that this is an


absolute craze and they have spent the whole weekend chasing Pokemon.


What is it all about? I know the shares have gone bananas for a week


and a bit now to adopt what do you actually do? You asking the wrong


person but you have to chase by come on, collect them and exercise them.


I downloaded it but it took up too much space on my phone so I deleted


it. The kids love it and they go out and they all walking. You have to go


into the real world and catch them. Nintendo now has a bigger market cap


on Sony and also Netflix. It is now larger and it is having an amazing


run. Richard will be back later. There must be is the editor about


it. I was with some friends I haven't seen the ages halfway


through the conversation, one of them started chasing Pokemon. It has


got too much! Out with the old and in with


the new - we'll take a look at the recycling platform


which helps businesses deal with You're with Business Live from BBC


News. Let's take a look at how living


studies are changing in the UK. A new report, published today,


says that poverty is not entirely Robert Joyce is from the Institute


for Fiscal Studies and is He joins us now from


the BBC Newsroom. Welcome to the programme. Just tell


us what you found. I understand those who are pensioners now are


probably net off at the moment? Yes, so one of the most I can friends in


terms of how body has changed is that it is much less about


worklessness than it used to be, partly because of good news stories


and much less unemployment. But it is also partly about bad news


stories, which is that for those in work, wages have stagnated, so the


problem of poverty is now much more about working households on low


earnings than about workless households. What sort of measures


does the government need to look at doing to try to tackle this gap that


is opening up? In the short run, one thing it is buying to do is to raise


the minimum wage quite aggressively. That may well help the number of low


earners but it does come with risks for things like the number of people


that employers choose to employ. In the long run, for sustainable wage


growth, we need productivity growth, we need to produce more with every


hour that we work. That's something we've been doing very badly recently


so it does come back to things I priced investments in infrastructure


and skills and education policy. Robert Joyce, thanks very much.


It is a very difficult square to circle as it were. Most governments


in the developed world are facing that problem of those who are in


retirement now, have probably got a better future ahead of them than


those retiring in their latter years. The report from the


Resolution Foundation about the mill lendials about the first to earn


less than the generation before. There is a lot more on the story we


mentioned about BT and the MPs conclusion that Open Reach has not


been invested in enough. There is much more work to be done. This lady


here is the Chief Executive of the TalkTalk. A guest here on Business


Live. She is calling on Open Reach chiefs, she is saying, it is not fit


for purpose. A lot more about what she has to say about that and what


MPs concluded on the Business Live page.


You're watching Business Live, our top story, the internet giant


Yahoo reports widening losses as it struggles to keep up


The California-based company is yet to provide further details


on a potential buyer for its "core" internet business.


A quick look at how markets are faring.


The European markets are opening down slightly this morning. We'll


try and bring those to you later in the programme.


Let's get the Inside Track on a business which helps find a new


In the US alone, the environmental agency estimates that businesses


dispose of some $100 million worth of furniture


GlobeChain is a "free-cycle" platform which allows businesses


The website helped one nationwide retailer recycle its shop fittings.


The retailer donated tables, shelving and display units, saving


There are now 1,000 companies on the platform including


With us is May Al-Karooni, founder and CEO of GlobeChain,


an online reuse platform that connects businesses,


charities and people to enable them to reuse unwanted items.


Thank you very much indeed for coming in. So we kind of simply


outlined for the viewer there how your company works. But just explain


why and when you started this, you were in investment bank, weren't


you? I used to work in a bank and they moved offices across the road


and they came round and basically told us to pick new tables, chairs,


computers, carpet tile colours. So I said why don't you just move, you


know, the stuff we have across the road and they were like, "No, we're


going to throw it away." When I spoke to the facilities people and


asked how much it cost, it was around $50,000 to do this and I just


thought that's commercial madness. That's really how I ended upsetting


up the company to really connect businesses to charities and SMEs to


give-and-take unwanted items so we focus around the retail, commercial


and construction. It is one thing to have the idea. I mean, I have lots


of ideas and think how does this work? But it is making it into a


business that's another thing. How did you do that? It was a lot of


work. The first couple of years, we basically did a very basic product


and trialled with a few, pioneering businesses at the beginning and we


looked at the kind of the supply chain and seen who took it and


collected data on the social, environmental and economic impact of


that. So from there we built the network and it is national across


the UK. How easy did you find it to get companies to sign up? Where they


willing? On both sides, to actually donate things and also companies to


then take the refurbished? I was quite surprised actually because


these are really large companies and they were really open to taking a


risk with a small businesslike ourselves to try something new and


they don't really have many solutions in the market apart from


obviously recycling and sending it to a landfill site. So this was


something new and innovative and they liked the social impact side


where da is not that great at the moment. How do you make money doing


this? We charge the corporate for giving the items and it is cheaper


than your typical waste disposal costs, so it is an annual fee or


pay-as-you-go fee. The people taking the stuff? They take it for free. So


they pick up for free. The idea is to help them and enable them to take


free items and give them a cost saving and help them with


employment. Is it just furniture? No, retail fixtures and products,


people like Radisson Hotels do duvets and linen and the NHS do


medical equipment. Barts Trust do that and we do construction waste.


Anything from raw materials to samples to any refurbishments. Is


there anything you can't? Not really. It is more difficult for


broken items and electricicals because there is legislation around


this, but we have a few members that will take that type of thing, but


that's focussed on the recycling side. Do you ask those who are


giving the items that they are up to a certain quality, or do you revamp


them? No, we are a technology company. So we don't touch the


goods. So the tran action really is between the giving party and the


taking member. What about other countries? Yeah, we've been looking


at Latin America and we have had a lot of interest in America. A lot of


these companies are asking for global solutions so it is quite


exciting times. Very exciting and fascinating. Thank you very much for


coming in. Very interesting. It's almost eight years


since the financial crisis brought the global banking system


to its knees, considered by many to be the worst meltdown


since the Great Depression. This week, we're taking a a look


at the health of our banks with our Today, we're in China -


its banking sector is But many of its banks are state


owned, putting a huge They dominate here in the heart


of China's commercial capital. Now, let's start this


little circuit in the city The biggest bank in


the world is Chinese. ICBC has just over 3.5 trillion US


dollars in assets. It has around half


a billion customers. In the years following the global


financial crisis, there have been interest rate cuts and there has


been a boom in credit. All aimed at boosting the economy


and all on the orders of the government which owns


or controls most of the banks. Well through all of this,


the government will remain focussed on its number one priority,


maintaining harmony and maintaining stability even if that means saving


a few banks that shouldn't be saved. Richard has returned. We are talking


about various stories in the papers, she says, trying to find them


quickly. We were going too talk about Netflix. Richard, you explain,


Netflix out with its figures last night and they really disappointed?


The earnings weren't too bad. What really disappointed the markets and


the shares fell 16% in after hours trading was the number of


subscribers. So the market was hoping for 500,000 more subscribers


in the US and there were only 160,000 more and they had been


hoping for two million more subscribers worldwide and they were


only 1.5 million more. Why are people not subscribing? That's the


question. I have a lot of jorgan called grand fathering moving people


from good deals on to deals that you are no longer offering. They have


ungrandfathered so they haven't been able to move customers on to the


more expensive deals and that's why they are losing out on subscribers


and they are losing out Games Of Throne, competitors have got better


shows. Well, let's get the viewers view on this. One tweet going by the


name of Mouse said, "They are slow to add new films and better service


elsewhere." We had from Tim he said, "I use Amazon Prime over Netflix. It


is useful for people like myself who travel." One says, "I'm moving to


Net Flops! They are not adding stuff regularly enough." I can never find


anything to watch because there is so much choice. It is because you're


trying to find pokey month Go or whatever you're doing with your


sons! Wells Fargo spends ?300 million on


European head quarters in London. Is this true? These companies have seen


their shares fall on fears that people will move out of London and


elsewhere in Europe. It is a big vote of confidence in London and a


big boost for the property companies. But there has been some


suggestions over the week that we could have seen up to 26 million


square feet which is something like 11, O 26789s dumped on the London


market. It is perhaps a sign that things aren't going to be as bad as


people thought. What's your feeling about Brexit. It is a massive story


for people like you. What's the sense about it at the moment? The


equity markets have shrugged it off. There is, I mean you have got to


look at some of the subtlies, defensive stocks have driven a lot


of the increases and the FTSE 250 hadn't been impressive. Globally


markets are expecting more stimulus from central banks which is driving


them higher. So the equity markets, the reaction has been positive.


Richard, thank you. It is good to get your thoughts. That's it from


Business Live. Thank you for being with us. See you soon. Bye-bye.


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