0:00:12 > 0:00:14This is Business Briefing.
0:00:14 > 0:00:15I'm Sally Bundock.
0:00:15 > 0:00:19Snapchat shares plunge as it reveals it is struggling to attract users
0:00:19 > 0:00:21and turn a profit.
0:00:21 > 0:00:24It also warns the months ahead will be challenging -
0:00:24 > 0:00:28we talk you through what's at stake.
0:00:28 > 0:00:31The US President heads to China as he continues his tour of Asia.
0:00:31 > 0:00:34He's criticised Beijing's trade policy in the past,
0:00:34 > 0:00:37but will he soften his tone as he looks for support
0:00:37 > 0:00:39in the far East?
0:00:40 > 0:00:46And on the markets.
0:00:46 > 0:00:53A pause in the rally in Asia and the price of oil has fallen a touch.We
0:00:53 > 0:00:58will talk you through the market moving stories.
0:01:06 > 0:01:08Shares in the parent company behind Snapchat have plunged 20%
0:01:08 > 0:01:16in after-hours trading.
0:01:16 > 0:01:19Third quarter losses more than trebled to over $400m
0:01:19 > 0:01:23in the last quarter.
0:01:23 > 0:01:26Even before this latest set of results, the company had already
0:01:26 > 0:01:29lost nearly two fifths of its value since Snap went public
0:01:29 > 0:01:33back in March.
0:01:33 > 0:01:36Hoxton Ventures is a venture capital firm which invests in early
0:01:36 > 0:01:39stage technology companies.
0:01:39 > 0:01:47I'm joined by one of its co-founders, Hussein Kanji.
0:01:47 > 0:01:53In terms of Snapchat, what did they say in terms of their earnings?They
0:01:53 > 0:01:59do not save very much and that is part of the problem. The number of
0:01:59 > 0:02:06people is down from previous estimates and they came far below
0:02:06 > 0:02:12that which is one of the reasons the stock has plummeted. No one thought
0:02:12 > 0:02:18it was going to be this bad.The issue is its business model is quite
0:02:18 > 0:02:24unusual when comparing it to Facebook or Twitter. In the sense
0:02:24 > 0:02:28that things disappear very quickly and the user base is a very
0:02:28 > 0:02:33specific.It is not that different from Facebook from a business model
0:02:33 > 0:02:40perspective. These are devices and applications people are using and
0:02:40 > 0:02:45you can put advertising in front of them. It is the existential
0:02:45 > 0:02:53equation. Facebook has declared war on the company and has copied
0:02:53 > 0:02:56practically everything. Instagram has doubled the amount of users that
0:02:56 > 0:03:05Snapchat wants.Facebook wanted to buy it. They said no thanks. And
0:03:05 > 0:03:11Facebook has pretty much a declared war but will each win the war? Will
0:03:11 > 0:03:16Snapchat still exist in a few years time?Kennett become an Independent
0:03:16 > 0:03:23company? It looked like it was going down that road but it does not look
0:03:23 > 0:03:29like it is a very sustainable company as a public company.
0:03:29 > 0:03:40Facebook makes about $5 per viewer Snapchat makes about one.We were
0:03:40 > 0:03:44all talking about shares plunging after Facebook went public...
0:03:44 > 0:03:52Correct. They are giving Snapchat a little bit of flexibility because it
0:03:52 > 0:03:56is not immediately obvious if you can become sustainable but with
0:03:56 > 0:04:04these numbers, profitability is down, numbers is down. The only good
0:04:04 > 0:04:09news is that it sold for 2 billion cash so it can sustain these losses
0:04:09 > 0:04:16for a while.Twitter has expanded to 240 characters.What difference will
0:04:16 > 0:04:24it make? Twitter itself is searching for reinvention. It is of the same
0:04:24 > 0:04:31problem as Facebook. It is not as healthy as Facebook. We will see if
0:04:31 > 0:04:36it makes much of a difference. A small group of folks wanted more
0:04:36 > 0:04:40characters but the bigger problem is can they turn this into an affect if
0:04:40 > 0:04:46business.A question we have been asking for a long time. Thank you
0:04:46 > 0:04:53for the analysis. You have sent in a lot of use and most of you saying
0:04:53 > 0:04:59you are more of a Facebook kind of people rather than Snapchat. We will
0:04:59 > 0:05:01discuss that more in detail later.
0:05:01 > 0:05:03In the next few hours, President Trump will meet
0:05:03 > 0:05:05with his Chinese counterpart Xi Jinping.
0:05:05 > 0:05:08The nuclear threat posed by North Korea is set to top
0:05:08 > 0:05:12the agenda, but Mr Trump is also expected to take aim at the trade
0:05:12 > 0:05:14relations between China and the United States.
0:05:14 > 0:05:17Let's cross over to our Asia business hub to speak to
0:05:17 > 0:05:23Sharanjit Leyl.
0:05:23 > 0:05:28Tell us about how significant this trip is from the point of view of
0:05:28 > 0:05:34reasons and trade?Well, massively significant because when he lands in
0:05:34 > 0:05:38China today, he will be joined by the losses of more than two dozen
0:05:38 > 0:05:42American businesses and during this visit they are looking to strike
0:05:42 > 0:05:46billions of dollars worth of deals but we know there are many sticking
0:05:46 > 0:05:54points in leading the huge trade deficit America has with China. Also
0:05:54 > 0:06:00issues as intellectual but he first and market access. This trade
0:06:00 > 0:06:06delegation hopes for contract signing is aimed at reducing the
0:06:06 > 0:06:14massive trade deficit. They are mainly large companies such as
0:06:14 > 0:06:19bowling. They acknowledge such deals will do little to address a trade
0:06:19 > 0:06:24issues between the two. China has a number of rules preventing
0:06:24 > 0:06:28foreigners from taking stakes in their industry without a local
0:06:28 > 0:06:32partner, restrictions in the financial services and insurance
0:06:32 > 0:06:36industry. They argue that if US firms were allowed access, this
0:06:36 > 0:06:42would help China financial industry gain maturity. But a coring to
0:06:42 > 0:06:49analysts I have been speaking to, it will not be seen to benefit the
0:06:49 > 0:06:54Chinese firms in the long run and it will take really a long time, as it
0:06:54 > 0:06:58did with the Japanese, for the US and China to narrow their very wide
0:06:58 > 0:07:07trade imbalance.Thank you very much indeed. We will update you as the
0:07:07 > 0:07:08trip continues.
0:07:08 > 0:07:11Exactly a year ago, India's government withdrew almost ninety
0:07:11 > 0:07:13percent of bank notes in circulation.
0:07:14 > 0:07:16The surprise measure was aimed at restricting the country's shadow
0:07:16 > 0:07:18economy, but the move disrupted life across India,
0:07:18 > 0:07:25especially in rural areas.
0:07:25 > 0:07:28So one year on, has it been a success?
0:07:28 > 0:07:35Yogita Limaye reports.
0:07:36 > 0:07:40At an event in December of last year, the government announced that
0:07:40 > 0:07:45this village, up 100 kilometres from Mumbai, was going cashless. The
0:07:45 > 0:07:49first time ever, people were shown how to use a card machine and it
0:07:49 > 0:07:56doesn't be distributed to small businesses in the area. One year on,
0:07:56 > 0:08:02cash is king again. Even though the post outside this shop proudly says
0:08:02 > 0:08:05that digital payments are the future, most of his customers use
0:08:05 > 0:08:13cash.TRANSLATION: The network is up and down and there are power cars so
0:08:13 > 0:08:19there are many Thaisa cannot use the card machine. Only 15% of
0:08:19 > 0:08:29transaction are use.After the cash ban last year, businesses were hit
0:08:29 > 0:08:34hard at the government hoped that making this village cashless would
0:08:34 > 0:08:38help control the chaos. This is the only bank in the area and people
0:08:38 > 0:08:43from this village and 70 other have their accounts in this one branch
0:08:43 > 0:08:47and so when the government with two major currency notes, the queue
0:08:47 > 0:08:55waiting to withdraw money extended all the way down to the street. The
0:08:55 > 0:08:59government said its objective was to cut down on illegal cash holdings
0:08:59 > 0:09:04but it exposed just how many people in India are cut off from financial
0:09:04 > 0:09:10networks. Things have not changed much in the small tribal villages
0:09:10 > 0:09:14like this one. Many people here are an educated so they are not given
0:09:14 > 0:09:19that all credit cards. They had been given bank accounts but the brunch
0:09:19 > 0:09:27is a faraway and every trip costs money. This man, a social activist
0:09:27 > 0:09:32that works in this area, says Ariza potential solution. Most villages
0:09:32 > 0:09:36have smartphones and the government has launched an easy-to-use
0:09:36 > 0:09:47application.We spent so much money on infrastructure...In a country
0:09:47 > 0:09:50like India where two thirds of the population still live in villages,
0:09:50 > 0:09:55progress is slow and getting people into the banking system is one
0:09:55 > 0:10:00mighty task, getting them to use it is another altogether.
0:10:00 > 0:10:03Now let's brief you some other business stories ...
0:10:03 > 0:10:05Google's self-driving car division has become the first company
0:10:05 > 0:10:09in the US to test vehicles on a public road without a human
0:10:09 > 0:10:11in the driver's seat.
0:10:12 > 0:10:14Waymo says that passengers in Phoenix, Arizona will be offered
0:10:14 > 0:10:19a fully autonomous taxi service in the next few months.
0:10:19 > 0:10:22Sky has threatened to shut down its news channel in order
0:10:22 > 0:10:23to facilitate its takeover
0:10:23 > 0:10:25by Rupert Murdoch's 21st Century Fox.
0:10:25 > 0:10:28Fox already owns 39% of Sky, but regulators are investigating
0:10:28 > 0:10:30the deal amid concerns that Mr Murdoch's media empire
0:10:30 > 0:10:36could become too powerful.
0:10:41 > 0:10:44And now, what's trending in the business news this morning...
0:10:48 > 0:10:54Stocks slightly lower across Asia. The price of oil going down and also
0:10:54 > 0:11:03the dollar as well. We have more in the News briefing coming up. I will
0:11:03 > 0:11:13see you soon.