26/10/2016 BBC Business Live


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


The competition takes a bite out of Apple.


The tech giant s annual revenue has fallen for the first


Live from London, that's our top story on the 26th of October.


Bruising results for apple as the darling of Silicon Valley


gets squeezed by the competition Posting a 19% fall in profits.


Women are on their way to being paid as much as men, in 2186!


We'll be telling you why equal pay is thought


And China's currency the Yuan has sunk to a six-year low.


Will the world s second biggest economy benefit from the drop.


Touker Suliman, the multimillionaire entrepreneur and star of Dragons Den


will be joining us in the studio to give us the inside track


Let us know what you think about Apple. Have they peaked?


Could there be a problem with Apple's core?


The world's biggest tech company has reported its results for the last


year and they don't make for pleasant reading.


It's the first time since 2001 that the darling of Wall Street has


posted a fall in annual revenues ending one of the hottest


Apple's sales in 2016 came in at were over $215 billion it's


a huge number but nonetheless a fall of 8% compared to the year before.


And the company also reported a fall in iPhone sales for the third


quarter in a row for investors it's key as the iPhone is


In the last three months Apple sold more than 45 million iPhones,


that is better than expected and remember the new iPhone-7


was launched after this quarter ended, so doesn't


In the last quarter, they made $9 billion that's a fall


of 19% compared to the same time last year.


Some say it's a sign that the smart-phone market


is saturated, that's to say, those who want a smartphone,


Revenue from China which is seen as a key growth market


So in many ways it's been a difficult year for Apple,


all of this on top of the ruling from the EU that it owes


the Irish government $14.5 billion in back taxes.


Sebastian Anthony, Senior Editor at ArsTechnica, is with me.


What is your take on these numbers? In line with expectations, slightly


above, if anything just a sign that it's business as usual in the


business industry. Shares are still up 20% over the last quarter so


analysts are happy. It just looks like business as usual. You say


business as usual, but many are looking at Apple and saying has it


really peaked, the question we are putting to viewers this morning,


have we got to the point where Apple will no longer be coming out with


record-breaking numbers quarter on quarter gist because we are not


upgrading or changing our iPhones as quickly as they would like? I think


that we probably have hit the peak of Apple's current business model


which is high-profit devices. I think much of the tech industry is


seeing the same pressure so we saw it with Microsoft, we have seen it


with probably Google as well and now we are looking at Apple trying to


find the next segment to move into which it looks like it will be


services, iTunes, Apple music, that kind of stuff but yes, we have


probably seen the end of crazy flagship smartphone profits I would


say. There was a time when whatever Apple launched, there would be long


queues outside stores and we still get that, but it strikes me that


people who have the iPhone 59 presidential 6 are hanging on to


something radically different and getting to the point where they are


not upgrading for the sake of it, only upgrade when the device is


broken and you need a fresh one? It's a process, yes, we saw it with


PCs, TVs have always been this way, you buy one and there's no reason to


replace it until it breaks, you have people that hold on to their 4S, 5S


and there's little compelling reason to upgrade. Yet it's a critical time


for Apple because its rival Samsung is kind of out of the market at the


moment. ? Apple claims it had a supply issue and didn't capitalise


on the exploding phones. But also it's just the beginning of that


quarter, we'll probably see in December, January, whether they


actually manage to capitalise on the exploding phones but you are right,


it's a good time for them. It's worth noting that the S7 and the


Edge sold very well, as well as the 6S. The watches not though? No, I'm


a proud wearer of. They are not selling well. That was a weird


segment. Yes, people didn't expect them to do well. It was weird that


Apple got into that, they were responding to market pressures but


yes, not surprised. Thank you for your time. There is so much more


about Apple on the website as well with analysis from the team in


technology here at the BBC so dig deep. Capitalising on exploding


phones, there's a story! Nintendo has reported a lots in the three


months to September after the strengthening Japanese industry


impacted its profits overseas. Nintendo slashed its full-year


profit forecast by a third. A federal judge has approved a $15


billion settlement with VW to settle claims it manipulated diesel


emissions tests, the biggest fine in automotive history.


General Motors has warned that it may cut car production further


in Europe as a result of Britain's vote to leave the European Union,


as continued uncertainty hits demand for new vehicles.


The Detroit-based carmaker vowed to "take whatever action


is necessary" to offset the impact of the Brexit vote, which has


already cost it $100 million in the past three


And caterpillar cut its targets for the year for the third time saying


it's been hit by the downturn in commodity plieses translating to a


fall in mining activity. It expects sales to be $39 billion this year


Downton year before. -- Downton year before.


News from Lloyds. Not a huge change. Profits down about 15% on the same


period of 2015 but if you delve down into it, there is not a huge amount.


The interesting thing, once again, it's put aside more money to pay for


missold payment protection insurance. That was a big scandal


here in the UK related to insurance for things like credit cards and


mortgages. They have put another billion aside to cover that. That is


the latest in a number of banks putting money aside, a saga that


goes on and on. More news out of Asia, the Yuan has been trading


around near six-year lows, so why is that and what impact does that have


in China and further afield? Karishma is in Singapore. What is


going on with Yuan? It's been slightly trading up against the


dollar, going against the trend that you were talking about. We have been


seeing over the last week or so, as you were saying, the Yuan has been


hitting fresh six-year lows against the US Dollar and it's very much a


US Dollar story, if you will. That's on expectations the US Fed will


raise interest rates this year. But that's not the entire story. China's


not exactly an entirely free market economy, so its currently is


managed. A lot of the analysts have been telling me that China's Central


Bank is guiding the currency lower in an orderly and gradual way. Why


would they do this? Exports, a weaker currency makes China's goods


cheaper overseas but China is in a difficult position, the Yuan can't


be too weak because folks at home would get nervous and rush to take


their cash out of the country. Thank you very much Karishma. It's


tech that's dominating the markets both in aids yes and the US.


Nintendo issuing the profit warning for the year downgrading the outlook


to 30 billion yen down from the estimate. The Apple earnings came


after US markets closed. Shares down 2.5% in after hours trade. A look at


what is happening in Europe. Vodafone is going to pay ?4.6


million fined by Britain's Telecom watchdog for breaching consumer


protection rules. News from the banking giant Lloyds as we touched


on setting aside another ?1 billion for PPI. More on that in a moment,


but first Samira has the details about what is ahead on Wall Street


today. A solid increase of deliveries of the luxury electric


cars will be welcome news for investment news when Tesla reports


on Wednesday. Consumers want to hear about the acquisition. He also


reporting earnings Wednesday, Coca-Cola. They cut their organic


revenue growth forecast in July and warned of continuing weakness in


markets like China and some parts of Latin America. Following rival


Pepsi-Co's announcement to reduce sugar in soft drinks, investors will


be looking for similar targets from Coca-Cola.


Finally, cable company Comcast. AT could be a big rival.


That's Samira in New York for us. So much going on. Jane Foley is with


us, senior currency strategist, nice to see you. There are tonnes of


earnings stories to Wade through, but what we wanted to talk about as


well was this report out from the World Economic Forum, an annual look


at the gender pay gap. It's getting wider and wider which I find


astounding given the fact that the number of women in prominent


positions is going up-and-up and up and it seems to be on the agenda but


nothing is improving? This takes into consideration a lot of


different factors. One of the factors that went into this report


was the amount of hours women work and the amount of hours women work


are a month more than men. One of the reasons for that is caring. A


lot of women do unpaid work. The amount of opportunities it seems has


also reached a plateau, more women reaching senior positions but there


hasn't been that much new progress and there's pressure on the


Governments to do something about it. No-one likes quotas, the women


that get promoted through quotas don't them quotas, but it seems when


things aren't happening on their own, these things need to be pushed.


But 170 years to close the gap is mind-boggling? It is. It's


depressing for women who're working hard. Women now are at least as well


educated if not better in many universities there are more women et


cetera and there's a short fall there. We talked about this before


on this programme because both Jane and I have experienced this problem


and corrected it actually, a former employer for you and for me, we


found male counterparts doing the same job and being paid more. In


fact I had a tap on the shoulder from HR saying, we need to pay you


more. But women do that and maybe not realise that they are getting


paid less. Thank you, Jane. That was a result! Lots of stories to cover


in terms of business news. Including my favourite story, why a chicken


shop is being sued for $20 million by a grandmother. The dragon is out


of the den! Toukeris here. You are with business live from BBC news.


Vodafone's been hit with a huge fine from Ofcom over the way it treats


its customers. The Telecoms regulator's fined Vodafone ?4.6


million for mishandling complaints and a fail your in IT systems that


cost ?10,452 customers to be precise they paid extra money. Lynsey is the


consumer group director for Ofcom. She spoke to us earlier discussing


why this was a problem on what's happening in the industry.


This is a significant fine, the largest we have levied. As well as


the fine, vote fiend's had to recompense all the customers and pay


a further contribution of ?100,000 to charity in lieu of the small


number of customers they weren't able to trace.


To be clear, we want the fine today to send a clear message across the


industry, not just to Vodafone, that every consumer expects and demands


high quality customer service and that's what they need to deliver.


Andrew Walker is in our business newsroom. Talk us through this, it


is easy to say they had errors with how they handled complaints and


things like that but it's a bit more complicated. At base, this is about


a group of customers who had pay-as-you-go phones who paid money


to top them up and they simply were not credited with the additional


money. Now these were phones that had been dormant for at least nine


months, and when they reactivated them they were given messages saying


they would be able to make calls but in fact they couldn't. Vodafone


accepts it should have done more to do with the problem, taken action


more quickly, but it has now managed to track down nearly all the


customers concerned and reimburse them to the children of an average


of ?14 plus a few pence. There were 30 they were unable to track down


and cover that, they say they have no intention of making a profit from


what has happened, so they have made a donation to charity to the June of


?100,000, which I think it would be fair to say more than covers the


money involved. Ultimately though it was a result of a problem with the


migration of very complex information technology willing


system and some customers suffered as a result. Thank you for


clarifying that. Heineken are stating a rise of beer sales of the


third quarter by 2%. You're watching Business Live -


our top story Apple has reported its first drop in annual


revenue since 2001 - with the third successive quarter


of declining iPhone sales. But the company is predicting


that it will return to growth over A quick look at how


markets are faring.... A quick look for you at Europe.


Trading down so far on the day. The Dax coming off those record highs


that we saw midweek. Now, as promised -


we've persuaded our next guest He's the serial entreprenuer


and investor... And best known to many


as one of the Dragons If you are watching around the world


may be known as Shark Tank elsewhere.


It allows entrepreneurs to pitch business ideas to a panel of experts


in the hope of securing an investment.


Touker Suleyman started his career at the age of 18,


when he established his own clothing manufacturer.


He has since go on to turn around fashion businesses including Ghost


After joining Dragons' Den last year, Suleyman has so far invested


700 thousand dollars on the show - in businesses ranging from a gourmet


brownie company to a musical flushing toilet!


His latest investment off the screen is a baby teething toy company


called MatchStick Monkey - which he hopes to expand


into a whole range of branded baby products.


We'll be speaking to Touker in a moment, but first


here he is in action on the British version of Dragons Den.


You are stretching ourselves very wide. You're better off focusing on


one brown. At Edna how it can stop something that is doing so well.


That is why we want both and they are both succeeding so well. OK,


I've seen it before, Anthony, two brands, two websites, you're in for


a disaster. In for a disaster! Reassuring words. He does not mince


his words. Now, I don't. It is called seconds then for a reason. We


get straight to the point. Let's do that right now, it is quite small, I


am wiggling it around, matchstick monkey, it will set me back ?9 99 in


the UK and it is the little children. Three months to two years.


Who are teething and they chew on this. It had me 15 minutes to make


the investment. You were convinced from the outset? Husband-and-wife


came to see me, the husband wanted to invest in a bad business and the


wife said, I've got this monkey. I said what is that, as said he now


know what to do with it. That was it. We talk about investment and new


business ideas, this is to be frank a really simple concept. What is it


you can spot in that because it is nothing particularly radical or new


but it is something you think is worth the investment. Matchstick


Monkey, what I saw in that initially was a brand that I could take into


lots of products, in the books, cartoons, animation. I've even got


Mike Chapman, the famous Mike Chapman, simply the best, writing


the jingle. So in my view, if this isn't doing within three years a 200


million turnover, I would be very surprised. My first thought was


nearly ?10, I would not spend it on that because of the get thrown out


of the picture in the park and I will never see it again. All I can


tell you is the first delivery of the goods is next week you will see


it in lots of high streets, Mothercare, M, other stores, they


are going crazy for it. We have got 20 countries who want to buy it,


they can't all be wrong. Let's move on from the monkeys, as mad to talk


about them. Monkey business. And talk about your day job, clearly the


Dragons Den is fun, a lot of money involved, spending so much of your


own money doing that, but it is the day job that got you there. How did


you begin, because like many of the people who come into the den you


have suffered your first there are success and failure. I started very


young. That the age of 208I was very successful, chairman of two public


companies and I bought one is this that was wrong. Pack of cards, had


to start all over again. But you know failure is only a result of


your journey. It is not the end. Since then, I have just focused on


my businesses, which was clothing manufacturers to start, and then


commercial property, which in this area has done me very well, and then


taking brands which were in trouble and restoring them back to its


former glory. Many watching the show and the Dragons Den will want to


know what it is that makes you a winner when it comes to being an


entrepreneur. Anyone can be a winner, not just me. As far as I'm


concerned, I spot good entrepreneurs, good ideas, and very


quickly I work out in my head and say what value can I add to that


business? Where could it be in 12 to 18 months, three years' time? If the


full coming to pitch not just in the Denver anywhere, so you are going to


look for an investment, be it on a crowdfunding sort of platform or in


a traditional investment method, what are the top tips? What do they


need to prove? When you come to the den, you have got to get your


numbers right, we all know. Make it very simple for the investor to


understand what you've got and what you are pitching for. What the


planners. I have seen new mauling entrepreneurs and the den usually


because their figures don't pick up. I think in some ways they are very


nervous. They come to the den, there are five Dragons sitting there, but


in a lot of cases the border do their homework properly. They don't


look at their competition. You have got to know your margins, your


turnover, your profit. And say to yourself, have I got everything that


an investor would want to know? All right, Touker, I wish we had more


time, but I will keep an eye on the monkey business for sure. Let's see


if you are right this time. I think I'm right on this one.


In a moment we will look to the business pages, but a reminder of


how to get in touch. The Business Live pages where you can stay ahead


of the braking business news. We will keep you up-to-date with all


the latest details, insight and analysis from the BBC's team of


editors right around the world and want to hear from you too. Get


involved in the BBC Business Live web page, and we are on Twitter.


Business Live on TV and online, whenever you need to know. Jane is


back and Ben did say one of the most intriguing stories that caught his


attention was this one in the Washington Post, a grandmother suing


KFC for $20 million because she didn't get enough checking. She was


thinking it is foul play! Basically she saw the adverts on the TV, we


have all seen the adverts on KFC, lots KFC, lots and lots of chicken,


overflowing the basket, and she went home and there was not worked at


all. She complained, they offered her a free gift, she turned back and


said no. So is KFC staff now always 20 billion a small out of money? She


says it is the principle of the matter. Sometimes you have to hit


people where they fill it. KFC will field $20 million. We will have to


watch that space. She will get of money I would imagine! That is


mentioned some of your treats. Andrew says Apple will never be as


good as it was when Steve jobs was alive. Keep your comments coming in.


Thank you to Jane and thank you for watching. Goodbye.


Hello. The weather has done something of a U-turn. We have lost


the chilly easterly winds, the now coming in from the West,


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