07/12/2016 BBC Business Live


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


A $50 billion boost for US businesses.


Japan's Softbank promises to invest in America.


a move Donald Trump says is a result of his election victory.


Live from London, that's our top story on Wednesday, 7th December.


It is the billionaire bromance - the boss of Japan's Softbank met


with the US President-elect to talk trade, investment and


Also in the programme, it's the media merger that


could be shape the future of the industry.


AT and Time Warner will try and convince US


politicians their tie-up is a good idea.


It was another record close in America pushes


It translated into a better start for Europe.


Does slow internet access hinder economic growth?


We're more connected than ever before, but as our reliance


on the web grows, we'll meet the firm that says its services


are 128 times faster than traditional connections.


A "processing error" by the UK's statistical authority means


the trade deficit is actually ?6 billion higher than they thought.


What's your biggest miscalculation you've ever made? Don't hold back.


Send your confessions. $50 billion - that's how much


the head of Softbank says he will invest in US businesses


after meeting with President As if that bumper cash


injection wasn't enough, he also announced that the firm


would create 50,000 Well, the announcement saw shares


in the Japanese technology firm jumping 5% when the market


opened earlier today. Softbank isn't adverse


to splashing the cash. In July, the firm paid $32 billion


to acquire the UK technology firm ARM Holdings which makes microchips


for the likes of Apple and Samsung. Here's what Donald Trump had to say


after meeting with Masayoshi Son, Softbanks billionaire


boss and founder. This is someone from Softbank. He


agreed to invest $50 billion in the United States and 50,000 jobs and he


is one of the great men of industry. I just want to thank you very much.


Thank you. For the details we can speak


to our Asia business It pay to be in that golden elevator


in Trump Tower? It was very apparent that the rapport that the two


billionaires shared, it has been called a billionaire bromance, it


was evident in the way that they were speaking to one another, and


the body language, the arms around one another, but certainly, there


are some very real and practical reasons why Softbank, the boss of


Softbank, made this decision to invest in the United States at a


time when arguably it could be said the US is pulling out of global


trade deals that Japan for instance has been such a big backer of, the


Trans-Pacific Partnership, the TPP that we have been speaking about, on


the channel, and one of the key reasons Sally is because, of course,


for many years now Japan has struggled to retain that top slot,


the top slot in terms of IT innovation technology innovation and


this particular investment, it is thought, will give Softbank the


access to Silicon Valley, to the United States and hopefully, create


the synergyies that the boss of Softbank believes he needs to keep


going and acquiring in terms of his vision for the company and in terms


of the internet of things, the grand future that he has designed for


Softbank. It goes to show that Softbank and those in charge, they


are pretty canny. They snapped up Arms Holdings of the UK, one of our


prized IT companies here and just to mention, that Softbank, we get the


impression, it is a financial firm, it is not, it is all about IT, isn't


it? Absolutely, all across-the-board, its entire vision


is very much focussed on the concept of the internet of things, but it is


not just in the internet, or those sorts of devices, chips, as you were


mentioning earlier, it is about telecommunications, a few years ago,


Softbank made a massive investment in the United States, some $22


billion worth to acquire a company called Sprint. That investment has


not gone very well. To date it lost something like $7 billion worth of


its value. Now, there are some who are speculating that this particular


move by the Softbank boss at a time when it seems like president-elect


Trump is becoming more amenable to future business deals in the United


States, maybe particularly savvy because the Softbank boss has been


trying to merge or buy another US telecoms company, but it hasn't gone


through because of regulations in the United States. The environment


maybe a bit more pleasant for him now.


For now, thank you for your detail on that story. Interesting.


The media mega-deal that could end up being one of the biggest


In October, the US telecoms giant AT announced plans to buy


entertainment group Time Warner for $86 billion.


The deal would be a merger of AT's distribution networks


But it is far from signed and sealed.


In a few hours the bosses of both companies will appear before a US


Senate committee to try to ease fears that the deal


AT is the world's biggest telecoms company, according to Forbes.


Last year it posted revenues of $146.8 billion.


It's mobile phone business has just over 133 million


customers in the US and another 10.7 million in Mexico.


And AT has TV channels with 37.7 million subscribers


They're hoping the tie up will help them add to that


by offering Time Warner's vast content including CNN and HBO


which makes international hit programmes like The Sopranos


It also owns Hollywood's Warner Bros movie studio.


The US president-elect Donald Trump has vowed to block


the tie-up saying it puts "too much concentration of power


Although it's the US Justice Department which will have the final


say on whether it can happen or if conditions will be attached.


Samantha Tomaszczyk is a Financial Reporter


Good morning. So, you know, it is a huge deal if it does go ahead and


yet there will be hurdles along the way. Talk us through how it is


likely to go today and beyond with the competition authorities? Sure.


So today there is a court hearing, I think it is worth pointing out that


today's court hearing is just advisory so it will set the backdrop


along with Donald Trump's comments to the general public opinion on


this deal, but as you said, it is the Justice Department which will


have the final say. Do you think the two companies will have to give up


much or get rid of certain assets in order for the two to come together


because although they are both big players in their respective markets,


they do do different things, don't they? They do, but it is a case of


bundling content. I think with any deal of this size, access to


programming which rivals tends to be quite a big issue. So I think the


Justice Department will really look at whether rivals will continue to


have good access to programming. That's been a concern by some. I


touched on it in the introduction about Donald Trump threatening to


block the deal. I suppose the question is can he and what happens?


It doesn't go straight to him, but it does go to one of his


departments, the DOJ, doesn't under estimate the power of public


opinion. So... He hasn't. That's how he got elected. It worked for him.


Briefly, before we wrap up, just explain what it will mean for users,


consumers, if the two marry up eventually and it could take a long


time because of legal issues, but if they come together, will it be


better for consumers or worse? It really could go either way and it is


up to the regulator to make sure it goes the right way for scunlers and


the access to programming continues to be quite widespread. But if they


manage to promote direct TV now which is their video product and if


it helps them advance that, then it could be good for consumers and for


video content competition. Samantha, thank you for your expertise on


this. As ever we will keep you up-to-date with every twist and turn


on that trying to go up the aisle as it were. I'm talking about the


wedding! All the coverage of the wedding!


The drugmaker Pfizer has been fined ?84 million -


that's about $106 million - here in the UK for "charging


excessive prices" to the publicly run National Health Service


The competition regulator says the price went up a massive two


thousand six hundred per cent overnight.


The drug's distributor, Flynn Pharma was also fined.


The US company says the decision is wrong and it will appeal.


Australia's economy shrank for the first time in five years


The dip of 0.5% is being blamed on spending cuts by businesses,


The mining boom and high demand for Australia's commodities have


kept the economy recession-free for the past 25 years.


Shares in the troubled Italian bank have risen amid reports that the


Government is poised to take a controlling stake. It is trying to


put a 5.5 billion rescue plan in place to help it deal with its huge


volume of bad debt. There as been heightened uncertainty since Italy's


Prime Minister decided to offer his resignation after losing a


referendum at the weekend. The FTSE seeing its biggest rise


since the referendum vote in the UK. That was back on 23rd June. So


markets doing well. After another record


close on Wall Street - It is a similar picture in Europe.


The markets are strong in early trade. Traders are looking ahead to


the European Central Bank meeting. That's taking place on Thursday.


That's expected to bring us some news maybe that it will extend its


stimulus programme beyond the March end date. That's always been in the


diary, but perhaps it could go longer given the uncertainty and


Italy's market doing well yesterday, posting its best levels since the UK


referendum vote. Even, of course, as so much remains in doubt about its


political future and its banks were the biggest winners.


Last month's decision by India's government to withdraw around 80%


of the country's banknotes sent shockwaves through the country.


And its impact is likely to affect the central bank's


interest rate decision - it's due to announce it shortly.


There is no doubt that the shortage of cash here in India will have an


impact on the economy and that's why, the bank of India's decision on


interest rates is being watched closely. Most economists expect


there will be at least a quarter of a percentage cut in the main lending


rate. People have cut back on spending over the last one month and


this has hit businesses across-the-board. One of the sectors


feeling the effects of the ban on high currency value notes is the


auto industry. Some car makers are reporting a decline in sales. But


for the people, a rate cut could bring in some good news. Interest


rates for cars and home loans hover around 9% in India. Making it


expensive for people to borrow. Companies hope that lower interest


rates could help boost consumer demand. There has been widespread


criticism that the implementation of the ban on all currency notes was


mishandled. Much of it is directed at the governor of the bank of


India. He will be holding his first press conference since the policy


was introduced a month ago and he could face tough questions on his


organisation and the execution of some decisions. But most of all,


people will be looking for an answer on how much longer they'll have to


wait for this cash crunch to be over.


Joining us is Richard Dunbar who is Investment Director


So there is a lot going on, we've got Australian growth story going in


reverse. We've got the Indian rates and Italy and Softbank and Trump


tweets causing reaction on markets. Talk us through what's on your mind.


What are you keeping an eye on most? The markets are looking at Donald


Trump's positive policy, infrastructure spend and tax cuts,


deregulation and that's good. And that talks to the mood music that


we're seeing in Europe and Japan and elsewhere and despite rising


interest rates, markets are tend to go say on balance that's positive,


but there is plenty to think about. Interest rates are going up around


the world. They are likely to go up in the US. That is generally


unhelpful, but money is cheap and markets are focussing on that at the


moment. Markets have got uncertainty by the


bucket load and they are shaking it off. We had some uncertainty from


Italy over the weekend, but you could argue it is Italy's 63rd


Government since the war, so maybe it is business as usual. With Italy,


the view about the banks is that one element that could derail the


optimism, some kind of bailout on the way? Investors might be thinking


there is going to be a resolution to this problem, and we are starting to


see it. Richard will return in five minutes


with more detail on financial markets.


Does slow internet access hinder economic growth?


As our reliance on the web grows, we'll meet the firm that


says its services are 128 times faster than traditional connections.


You're with Business Live from BBC News.


That hurts your eyes if you stare at it too long!


I try not to stare at it! The Competition and Markets


Authority has fined drugs giants Pfizer and Flynn almost ?90 million


for raising the price of an anti-epilepsy drug


it sells to the NHS. Pfizer was fined a record


?84.2 million for their part Flynn was hit with


a ?5.2 million fine. Theo Leggett is in our


Business Newsroom. Some big fines, especially for


Pfizer. A very big fine, although Pfizer is also a big company, and


more than able to absorb it. Pfizer was selling an anti-epilepsy drug, a


branded drug, and the prices in the UK are regulated according to the


pharmaceutical price regulation scheme. What Pfizer did was license


it to Flynn, which the branded it, removed the name, and sold it as a


generic products. Normally generic products are cheaper, but in this


case clinical advice was that patients already using it should


continue using the same product, made by the same and a Thatcherite,


not even the same one made by somebody else. So Flynn could own


brand it, push the price up, and the cost to the NHS of a pack rows of


from ?2 83 to ?67 50 overnight. With Flynn taking in the extra income,


Pfizer could raise its prices, said they were both able to make money.


The authority reckons that this was abuse of a dominant position, and it


was wrong, hence the fine, but Pfizer says that before on branding


the drug was being produced at a loss, and the deal with Flynn


protected the supply for patients of. He said the findings are wrong


and they plan to appeal. The interesting latest move, with


Pfizer. More on the website. This is the


story we have been following about the future for Port Talbot steel


working. The ball is in the Court of the unions, is the view there. Full


details on the future for steel-making in South Wales.


Shares in the Japanese technology firm Softbank have jumped 5%


after the company said it would invest $50 billion


The announcement came after a meeting in New York


between chief executive Masayoshi Son and US


Donald Trump is claiming it is a personal victory, he says the


investment is only happening because he won the election. One that we


will follow very closely. London grabbing the headlines in the


markets. The rally is going on and on.


Few inventions have changed the world as


As consumers, we've never been more connected,


and for business it's transformed how and where they operate.


But it's the speed of our broadband that in some cases can


There are huge differences in the quality of internet services


In some countries, old pipes and wires mean firms are battling


And so regulators are trying to improve competition,


like here in the UK, where the majority of broadband


And so that's where new market players,


Hyperoptic operates independently from the main telephone exchanges


to provide internet directly to people's homes, and that allows


the firm to provide speeds over ten times faster than many rivals.


Dana Tobak is the founder and chief executive of Hyperoptic.


This is so relevant, with UK Government announcing in the Autumn


Statement a huge investment in technology. We are so excited that


we are seeing movement away from being dependent on the Monopoly and


the price competition only, and actually focus on investment and


getting to a full fibre solution, which is what the country needs. You


have been operating here for many years, I would imagine it has been


frustrating, because we have an old infrastructure that has been here


for generations, and it has been an incremental slow move to update


things. We have seen the incumbents tend to move when small players


start to do something different. When we founded in 2005, we were the


first to bring up to 24 meg services, and at the time the


environment were asking why anybody would need that. It is lovely that


here we are with hyper optic ten years later, and when we announced a


one gig, it was not so much about why we would need it, but what would


we do with it, and that is exciting. What needs to change? Many people


will be frustrated that they travel around the country, certain parts of


the country are poor with signals, and yet if you go to Hong Kong, they


have brilliant services, even underground. Is it just the legacy


issue? It is an education. For many years, the regulator focused on


price competition, from 2005 until 2011, 2012, it was about providing


an infrastructure where there was competition. That is when you saw


the low prices. At that time, it was considered a victory. When there is


under investment and a perception that price is more important than


speed, you will get the wrong long-term results. The good news for


us was that it presented an opportunity, we knew better, and we


knew that we could create the foundation for tomorrow and still


ask people to pay around the same price as the date, but for


fundamentally better broadband. It is a fascinating subject. We will


keep an eye on it. In a moment we'll take a look


through the business pages. But first, here's a quick reminder


of how to get in touch with us. Our page is where you can stay ahead


with the breaking news. We keep you up-to-date with the latest details,


with insight and analysis from our team of editors around the world. We


want to hear from you as well. Get involved on the web page. We are on


Twitter and on Facebook. On TV and online, whenever you need to know.


What other business stories has the media been


Richard Dunbar, who is investment director


at Aberdeen Asset Management, joins us again.


A statistical error at high levels is what is going on? The ONS have


miscounted the gold exports and imports in the trade deficit


figures, and they are 6 billion worth of we had expected. It is a


large error, but importantly, because everybody is looking at it,


we hope the figure improves, given weaker sterling and the fact it has


gone the wrong way is unhelpful. Somebody is in trouble at the ONS.


At least they have owned up and it has been fixed, so we know the


number. Maybe there has been more gold imports than we thought. View


was getting in touch, talking about their biggest miscalculation. One


person says, trusting a bank to fund my business of. One person says,


blame it on the latest software update, we always do.


Richard, what is your biggest miscalculation? I have made some on


airline bookings, one not booking for flights for the family to go on


holiday, and finding out the night before, you do not get a good deal


with six hours notice! Looking at other stories, what else? The Donald


Trump tweets are interesting. They are moving markets. Boeing was down


yesterday on the back of him saying he would not rebook the new Boeing.


For a full swan. Softbank was up, given the enthusiasm with which the


Chief Executive Rosneft. Or all traders now following him? I suspect


all traders are and all diplomats have now signed up to his Twitter


account as well, given that that is the route through which we find out


diplomacy as well as business. It is a brave new world.


There will be more business news throughout the day on the BBC Live


webpage and on World Business Report.


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