11/08/2017 BBC Business Live

This is Business Live from BBC News with Susannah Streeter

Snap, crackle and pop - the bubble looks to have

well and truly burst for Snapchat's parent company.

Shares plunge on bigger than expected loss.

Live from London, that's our top story on Friday August 11th.

Snap shares plunge by close to 17% as losses mount.

We'll be discussing what's gone wrong for the company that was once

From one troubled tech firm to another - Uber's ousted boss

Travis Kalanick has been sued for fraud by one of the company's

Also the latest on the European financial markets, cannot see

exactly what is happening at the moment but stocks have opened more

low following losses in Asia and the US as the war of words between

America and North Korea rattles investors. And we will talk about

the Google diversity road, the founder of Uber being sued. And as

tourists in Spain face a backlash from locals protest against tourism

we want to know have you ever faced hostility on your holidays from the

locals? Snapchat is the disappearing

messaging service that just keeps Its parent company Snap has

seen its share price sink like a stone in after-hours trading

as it reported widening losses. Snapchat launched in 2012

as a mobile app that allows users to send photos that

vanish within seconds. It's been a big hit with millennials

but has never made a profit. Perhaps the most keenly-watched

number by investors is the number That rose to 173 million -

up only 4% compared with the first Compare that with Instagram Stories,

a service on the Instagram platform Revenues at Snap almost doubled

for the quarter to $181.7 million, which seems positive but is also

lower than analysts The tech firm lost close to half

a billion dollars in the quarter, and investors will be very aware

that that's just not sustainable. Today's results came out

after the closing bell but the company has had a rough ride

on the markets since it went public in March,

with blockbuster valuation It's not shown on this

graph but in after-hours, trading shares were down by close

to 17%. Simon Collister specialises

in digital communications at the marketing firm Blackbook

London. Which of those numbers should we be

paying attention to, the user numbers, profits, revenues? It

depends who you asked, a lot of the focus has been on daily active

users, the number of people interacting with the platform on a

daily basis and whilst there has been growth, it's clearly not good

enough. But if you asked the founder and CEO of the platform he is keen

to point investors away from that, saying there is too much focus on

that and we should look at the engagement rates. And what are they

doing? They are looking quite impressive. What are they? How

people spend on the platform on a daily basis? It is a beacon of light

in terms of the results. Numbers of up to 40 minutes per day. That is

important to him because the longer they spend on it the more they pay

attention to advertising which means it's more attractive to advertisers.

That is a key point he is making, Facebook have an average time of

engagement of 20 minutes a day so this is double. And it's a much

younger demographic. They have always believed they can grow

revenue from the existing user base. But investors want a faster return

given the huge valuation. Yeah, that's where they are going to find

themselves in a difficult situation. They have been reluctant to

entertain ideas of quick growth, growth hacking as it is known in

marketing circles. Allowing users to add their own network, and they have

been against and that as they think it would compromise integrity. One

good idea seems to be fantastic then it runs out of steam and other

people copy it as well, look at Instagram. Yes and that's going to

be a challenge. The opening valuation was always based on the

idea they could out innovate Facebook, but Facebook were very

quick at copying what they had done. It's about how they can innovate

which will keep them ahead. And if they do not will they get snapped

up? CHUCKLES That is the big question, there were

rumours Google was interest last year and it seemed like an ice pick,

Google has always struggled to build its own mobile social network. Thank

you so much Simon. Europe's egg safety scare has led

the European Union Commissioner in charge of food safety to call

an urgent meeting of ministers Vytenis Andriukaitis has also called

on Belgium and the Netherlands to stop blaming each other

for the problems. Millions of eggs have been pulled

from European supermarket shelves over fears they contain

a banned insecticide. Google's parent company Alphabet has

cancelled a company-wide meeting to discuss a controversial memo

on gender diversity. The firm said there were concerns

some staff might be attacked Earlier this week the male software

engineer who wrote the memo was sacked for arguing the lack

of women in top tech jobs was due to biological differences

between men and women. Australia's financial regulator says

it's opened its own inquiry into accusations of money laundering

against Commonwealth The regulator's chairman said

the country expected better The bank has said a computer coding

error was behind more than 50,000 alleged breaches which could cost it

billions in fines. Let's go to China where

the country's largest social media platforms -

Weibo, WeChat and Baidu Tieba - are under investigation for alleged

violations of cyber security laws. Our correspondent John Sudworth

is in Beijing and he's been What are the accused of doing? These

are amongst the most powerful social media platforms in the world, each

of them used by hundreds of millions of people here in China and beyond

and the cyberspace administration of China has issued this directive

today saying they are now under investigation and the concern seems

to be the idea that some of the content, some of the charts and

messages and material being shared in danger as national security and

the cyberspace Administration points to things like spreading false

rumours, issues related to terrorism, concern about the content

there as well as pornography and a general sense that these platforms

are harmful to China's maintenance of political stability and order.

They are already very, very heavily monitored and censored but I think

this sends a message particularly at this moment in time just a few

months away from an important Communist Party congress, we have

seen a tightening of Internet controls in other areas and I think

a lot of people are reading this as sending a strong message that they

need to get the houses in order and get much better at policing

themselves. The signal is much more censorship and control to come.

Thanks very much. We'll keep an eye on that.

The standoff between the US and North Korea has been

Appetite for risky assets is low - instead investors are piling

into perceived safe haven assets like gold - the swiss

franc and the yen and that's put a bit of pressure

up reasonably well - but other indices in asia also felt

stocks suffered their biggest losses in nearly three months -

with around $30 billion wiped off the value of US blue chip

One firm that's hoping to be on wall street in the not too

distant future is Ride sharing giant Uber.

In June its co-founder, Travis Kalanick, was ousted as chief

executive after a series of scandals hit the company.

He is now being sued for fraud by one of their biggest investors.

Dave Lee is in San Francisco with the details.

When Travis Kalanick was forced out as Chief Executive of Uber he kept a

seat on the company 's board and a 10% stake in the farm but since then

it has alleged he has been concocting a plan to get his title

back. He reportedly told close allies he was Steve Jobs it, a

reference to the Apple founder who was forced out of the farm only to

triumphantly return more than a decade later, this alleges Travis

Kalanick fraudulently expanded the board to fill out with allies to

make such a return possible. Benchmark capital said it would not

have agreed to more board seats if it had known Travis Kalanick's

plans. If successful this legal action could see Travis Kalanick

kicked out of the company he helped build.

Simon Derrick, Chief Markets Strategist at the Bank

Have to talk about a country we do not normally talk about, North

Korea. The influence the geopolitical tensions have on the

markets, it's been rather slow in coming, nobody really paid attention

to this until about three days ago. And that is the interesting thing,

the markets not been that sensitive, I think monetary policy joined

everything out but over the course of last 18 months we have had no

consensus events happening, things like the election in the US, the

Brexit vote here, market suddenly becoming rather more sensitive and I

think this will prove to be another one of those and at the moment the

market is waking up to the fact that perhaps this is a rather different

kind of red like -- rhetoric. It is hard to read directorate coming from

the Trump administration, the Defence Secretary saying one thing

and President Trump seeing a much more hardline stance. And that is

the thing, this is taking place in August which is traditionally thin,

it can be more volatile, some of the larger moves taking place in August.

The risk is the market, with that uncertainty starts to take an

increasingly risk averse tone and I think that's going to be an issue

going into next week. Briefly on one company, some results from News

Corp, it showed a fall in their print advertising income. Yeah, that

move away, remember of course, one of the key newspapers within UK was

the content for Facebook,

our Technology Correspondent Rory Cellan-Jones will chart a path

through all the big tech stories You're with Business

Live from BBC News. A flight delay is one

of the worst possible Well, according to new BBC research,

air passengers using Gatwick Airport and flying on EasyJet have suffered

the longest average delays Kevin Peachey is in our

business newsroom. you have been looking at these

figures, what more do they tell us? You could have been unlucky and got

a flight from London to New York on a particular airline with average

delays of an hour and a half but overall it is Gatwick that you

mentioned with the worst average delays, 27 minutes on average and

for the airlines it is easyJet, 24 minutes average delay. There are

others, British Airways, Thomson, they also have delays of more than

15 minutes. These are figures from the last two Summers and past

performance does not necessarily mean it will be the same, but if you

look at the calculator on the BBC News website over past delays if it

has a record it might be worth packing an extra book or downloading

some cartoons for the kids. Is this way can gauge which airports and

airline to use? Yes, past performance is only a guide of

course but airlines and airports will say there are things beyond

their control, strikes and congestion in the skies and there is

a broader point over airport capacity and our demand for cheaper

flights and clearly there needs to be a quick turnaround for these

flights to keep the costs down and that leaves them more prone to

delays. Thank you Kevin. A story from The Today Programme

which interviewed the former aide to the Brexit Secretary David Davis. He

said on that programme the voters had been, quote, sold a pack of

lies. Mr Chapman added, my view is that the Conservative Party brand

has now been damaged to such an extent that it will never again get

a majority. He said the hard Brexit plan will

make Black Wednesday look like a picnic. There is lots more you can

read about on the BBC News website about the impact of Brexit. Or the

perceived impact of Brexit. He has had lots of coverage over

last couple of days, done several interviews saying the same thing.

You can read that on the BBC website, as we say.

You're watching Business Live - our top story:

There's been another sharp fall in the value of shares in the social

At one stage they slumped nearly 17 percent, after Snap reported

more than $400 million in quarterly losses.

The former Uber chief executive has been making headlines.

Google's been embroiled in a big row about gender

Meanwhile Facebook is launching a new video service and Netflix

and Disney have parted company over access to videos.

Lots to talk about. So much going on.

Our Technology Correspondent is Rory Cellan-Jones.

I would like to ask you for your take on Uber, the latest twist and

turn Uber story. What an extraordinary story. I can think of

a previous occasion where a venture capital backer of a major company

has got into a mud fight with that company, or at least its founder,

while still being a major backer. Benchmark Capital, one of the big

names in Silicon Valley, basically accusing Travis Kalanick of all

sorts of misdeeds, unhappy with the culture he has created at the

company, unhappy with the idea that he will still have influence. What

have they been doing the last few years?! Have they suddenly woken up

to what is going on?! Arianna Huffington has been brought onto

board. There has been a huge weight of money coming behind this company,

an extraordinary amount of backing, $8 billion or so, and you would have

thought that people putting that money bind the company would have

asked a few questions a bit earlier. Moving onto Facebook, Disney pulling

out of Netflix, starting its own streaming. Is this part of a general

trend? Another fascinating week in the ongoing battle between new and

old media, in a way. We know about Netflix making huge strides, we know

about Amazon Prime video signing up lots of people for OnDemand video.

Facebooked, there is already a lot of video out there, making a

determined pitch that they will be a place for original content.

Facebooked, funnily enough, the company said we are not a media

company, we don't need to be regulated like a media company, now

they are saying they will have original content which they will

commission. Treading on Netflix's toes? Yes, taking on YouTube, they

will reward people in the same way that you tubers get rewarded, they

will give them a share of advertising. A big battle going on.

The other development this week is Disney, you could count that as an

old media company, waking up to the fact it has been giving away its

contents, or at least rewarding a new platform with its content,

Netflix, saying we will take that off and do it ourselves. About how

will they do that? They said they would set their own platform? There

are already various Disney Digital platforms which have not made a huge

splash, this is the dilemma for a lot of old media companies. We are

all putting our content is old media companies on Facebook, including the

BBC. A great way to access new audiences. But we are watching as

they take the profits under control. Is there a problem for Netflix, the

fact it will not be working with Disney any more, all is Netflix too

big for that? I think Netflix is already past that stage. It has been

an incredibly bold company. When they first said they would spend

hundreds of millions of dollars, billions of dollars, on making their

own content as well as buying it in, everybody thought it was a bit

bonkers, it has turned out to be a pretty wise move. Google, there was

a big meeting to be held about gender diversity but it seems like

it has been cancelled. What is the update? Extraordinary upheaval over

this week. It is a mark of how big a crisis it has been for Google that

when this memo we merged questioning their diversity policy, the chief

executive broke off his holiday, came back and said we would have a

big meeting on Friday, he has cancelled bats because there has

been a huge backlash, which is quite scary to people inside Google, with

pictures and details of people published online on Conservative

websites. There is a mood of extreme disquiet within Google that they

will be caught up in a sort of culture war and people are feeling

pretty vulnerable. I gather he was so keen to make the point that

immediately after the meeting was cancelled he went to a coding course

and was talking to girls, a coding course specifically for girls and

saying we need you to come into the industry. I think it is part of this

attempt to undo this image that Silicon Valley has of being sexist?

Talking about it Uber has had all sorts of issues with its treatment

of female staff. Google has wanted to get ahead of that, knows it has

an issue, has put in all these diversity programmes, that is what

this engineer who was sacked was objecting to, the extent of the

diversity programmes. And I think the Chief Executive was good --

doubling down and saying we will carry on. While still trying to say

we have free speech in the company, a tricky balance.

Thank you, Rory, as usual. And you can hear more

about the latest from the tech world with Rory on his Tech Tent programme

on BBC World Service radio at 14:00 GMT today

which is 15:00 here in the UK. And if you miss it you can download

the podcast via the BBC website. 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. The Business Live Pages Where You

Can Stay Ahead With The Breaking Business News we will have insight

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We want to hear from you, get involved on the BBC Businesslike web

page, on Twitter or Facebook. Business Live on TV and online,

whenever you need to know. What other business

stories has the media been Simon Derrick, Chief Markets

Strategist, Bank of New York Mellon Let's talk about holidays, it is

holiday time. There is a story on want a cheap holiday, to be saying

Spain is too expensive, go to Bulgaria. What is interesting is

there has been a rise of protests taking place in Spain are people

essentially saying tourists seem to be taking over our cities, it should

be rather more balanced, not just in Spain, Venice has a very similar

movement taking place. On one hand you could look at this as being

simply about the sheer success of these cities as tourist

destinations, there is another side, which is there has been a recovery

in Europe but it is perhaps a recovery that is only benefited...

Surely it is also Tui trying to expand its market to Bulgaria? It is

a great marketing move, nobody would argue that. Maybe we should do more

of that in the UK. But I think it is a major thing that we are getting

movements like this in place. It is part driven by how we have driven

the recovery in Europe. This story has been picked by Bloomberg. They

have statistics showing the managers are making the most of the recovery,

it seems as if the recovery is not benefiting those workers and those

people trying to find houses in Barcelona and some of the big

Spanish cities, they are fed up with being squeezed out and not making

the money? It is really a mark of how this recovery is different to

ones we have seen in previous decades. Feels as though there has

been a real split between the relatively well-off who seem to have

come back relatively well and relatively quickly, and those

further down... Why is that? I think it is to do with what has been used

to drive the recovery. A lot of that was due to the ultra-easy monetary

policy, quantitative easing. That is great if you owned a house, shares,

assets of any kind. Yes we have had one of the longest ones for a long

time, it has been driven by easy monetary policy. If you had a

pension or own day house he did very well, if you did not own those

things you left stomach felt left behind. People trying to rent in big

European cities in seeing tourists coming into Airbnb properties feel

disgruntled? That is what you see behind these movements. In fairness,

you suspect it will continue. The people who own the houses are making

the money? That's it. Thank you. Thank you for joining us.

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

web page and on World Business Report.