26/03/2014 World Business Report


26/03/2014

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made the statement on her website. Those are the latest headlines from

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BBC World News. Now for the latest financial news with World Business

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Report. Could this be the future of gaming?

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Facebook CEO Mark Zuckerberg thinks so and has just bought the start`up

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virtual reality company Oculus for $2 billion. Cash is King: The maker

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of Candy Crush raises $500 million at its market listing in New York

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valuing the gaming company at over $7 billion.

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Welcome to World Business Report. I'm Sally Bundock. Also in the

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programme: Who will benefit most from President Xi Jinping's visit to

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Europe? We'll get an expert view. "It could change the way we work,

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play and communicate" ` those are the words of Facebook's chief

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executive about a technology start`up it's just agreed to buy for

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$2 billion dollars. Mark Zuckerberg is betting that Oculus, a

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Californian company which specialises in virtual reality

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products, has the most innovative tech leading to a new way for people

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to communicate, learn or be entertained. The start`up's flagship

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product, the Oculus Rift, is a goggle`like "immersive" headset for

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video gaming.The designer says he wanted to create a gaming experience

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like in the film 'The Matrix'. This to my parents garaged and those

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interested in stereoscopic displays. The problem was that there

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was nothing that gave me the experience that I wanted. I was sure

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that somewhere out there that was something that I could buy. The

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reality is that there is nothing. I set out to change that. Our

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technology reporter Dave Lee has tried this new gaming experience.

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What is it like? I have tried it on and it is a fascinating thing. The

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way it works is it is like goggles over your head and there are two

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screens one for each eye. You are completely surrounded by this 3`D

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worlds you can leave you can move your head up and around it if you

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look down to your legs you can see your virtual legs and you can feel

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like you're within a game. For the last year, maybe two years, the

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gaming industry has been very excited about this. One of the man

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behind this is a guy called John Carmack who was behind the Doom

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games. There is a lot of hope that this will be the next big step in

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gaming. A good move on the part of Facebook? When you compare this

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acquisition which it made for 19 billion, it seems like a steal. That

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is how ridiculous it is getting? Shareholders will need to be

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convinced again, when they? The interesting thing here is that it is

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hardware, things that people go and buy. It is a tangible product,

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unlike some of the applications that Facebook has. Will it appeal to the

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masses or is it something that hard`core gamers will want? We have

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been covering this is a gaming device but the statement by Mark

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Zuckerberg suggested he was looking at it as a communications device.

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One demonstration they used to do was in teleconference in. Rather

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than an awkward WebCam chats that companies have with each other, this

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could potentially give you an idea of feeling like you are in a room

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with someone and hopefully this is a more natural chat experience. That

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is the latest move by Facebook. The Candy Crush Saga is coming to

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Wall Street. The games developer King has been valued at over $7

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billion dollars after it raised $500 million listing on the New York

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Stock Exchange. It sold 22.2 million shares priced at $22.50 per share `

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the mid`point of the range the firm had initially set. All the attention

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has some investors asking: Is the market for new shares in a bubble?

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Michelle Fleury reports from New York.

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Wall Street has regained its swagger. The stock market is

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strong, the market to new stocks is on fire. When Candy crushed

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developer King Entertainments such shelling shares, it will make

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history. It will be one of Britain's most valuable companies on the

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Internet. This fund manager says that investors are once again Suite

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on initial public offerings. Were at 70% more in the number of IPOs this

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year than last year. And last she was a record. We have not seen

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records like this is the Internet bubble. Back then insatiable demand

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for tech stocks put the NASDAQ to its highest level ever, then

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crashing to earth. It is now looking a lot like that Internet bubble,

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according to this professor of behavioural finance. We had 80% of

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IPOs that were loss`making back then. Today we have close to 75% of

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the most recent IPOs. It is not just a hot market, it is a ultra` hot

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market if you compare it to the greatest bubble of all time. But the

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trouble with bubbles, at least a financial kind, is that they are

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hard to spot until they have burst. At this point, no one can tell if

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the enthusiasm can you share offerings is a signal of market

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strength or a danger sign. What is certain is that, lining up behind

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the maker of Candy crushed, are many other companies hoping to make their

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stock market debuts soon. Let's move away from the technology news.

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As France rolls out the red carpet for China's leader President Xi

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Jinping today, there's a strong sense that we're going to see the

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signing of some blockbuster business deals. China and France have strong

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diplomatic ties dating back over 50 years, France being the first

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Western power to establish full diplomatic relations, paving the way

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for Beijing's global acceptance. But why is France so important to China?

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And why has the UK been missed off the list for this European tour? I'm

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joined by Glen Macguire, Chief Economist, Asia Pacific, ANZ.

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This day in France, there is a lot of pomp and circumstance surrounding

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what will happen. What are you expecting in terms of deals? I think

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there was a lot of symbolism around this trip. It is 50 years since

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Charles de Gaulle broke ranks with the US and recognised Beijing. In

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line with some of its symbolism, you may see a number of large contracts

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signed. This is also reflecting the medium`term growth strategies China

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has in place. It has already built itself out as a large manufacturer

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of cheap, low value`added goods. What it did to the next stage of

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evolution and development is to move up the production possibility

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frontier to increases value and it will need to import a lot of that is

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manufacturing technology and capital goods that economies like France

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produce. They will be some large contracts signed on this trip, both

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as a result of symbolism and out of economic necessity. What you make of

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where the Chinese president has chosen to go on this trip `Germany,

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the Netherlands, France. But not the UK, and yet London wants to be the

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centre of trade for the Chinese currency. What you make of the

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choice of destinations? It is important to focus this more on what

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China needs in terms of its imports at this stage rather than what it

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needs in terms of its financial development. It is interesting, when

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you look at the type of goods China needs in this next phase of capital

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deepening, the principal capital goods exporters are Japan, France,

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and Germany. Given regional political difficulties, it is not

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surprising that France only agenda. There is a trade imbalance there

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already. Whereas Germany has a market penetration of around 5% of

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Chinese imports, it is much lower for France around 1.3%. I would be

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focusing more on that goods import dynamic, the types of technology

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China is meeting at the moment. As we move closer to market

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liberalisation and deregulation, that is when you will see more trips

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to the UK and London and the acceleration of other cities around

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the globe. Thank you very much indeed for your time. Here are the

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markets frequently. `` very quickly. I will see you soon as we look

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through the newspapers. Child neglect is now "rife" across

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the UK according to new research commissioned by a leading charity.

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Action For Children says one in ten youngsters suffer neglect, which

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could mean being absent from school, missing health appointments, being

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left alone or getting insufficient food. Jeremy Cooke

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