17/07/2014 World Business Report


17/07/2014

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BBC World News. Now for the latest financial news

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with Sally Bundock and World Business Report.

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Time Warner rejects a takeover by Fox, but will Rupert Murdoch take no

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for an answer? Plus, from the Farnborough Airshow.

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Beyond the black box. Tracking technology to make sure an airliner

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can never disappear again. Welcome to World Business Report.

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I'm Sally Bundock. We'll be going to Farnborough in just a moment.

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We start with two of the global giants of film and television.

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Shares of Time Warner soared on Wednesday after it revealed it had

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received, and rejected, a takeover offer from rival 21st Century Fox,

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run, of course, by Rupert Murdoch. The unsolicited offer, made last

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month, valued Time Warner at around 80 billion dollars ` an amount Time

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Warner argues is not enough. It said the company and its shareholders

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would be better off going it alone, and that there were "considerable

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risks" in doing a deal. Would the group be too big to manage? And,

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would regulators allow so much of the US media to be controlled by one

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firm? Time Warner said there would be no further discussions. However,

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its shares jumped 17% to around the level being offered by Fox,

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signalling the financial markets don't think it's over.

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From New York, here's Samira Hussain.

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Time Warner is the second`largest media conglomerate in the world, and

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it has piqued the interest of a persuasive suitor. It happens to be

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the world 's largest media conglomerate. If 21st Century Fox

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was successful in its bid to takeover Time Warner, it would

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create the world 's largest media company. With two Hollywood movie

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studios, local television stations across the United States, the most

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watched cable News network, and its closest rival, CNN, not to mention

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several popular American cable channels, like HBO, TNT and TBS. In

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order for 21st Century Fox to be successful in its takeover bid, it

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would have to cough up more cash. It seems to be a lowball offer, even

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though the premium suggested was over 20%, but a company like Time

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Warner is a once`in`a`lifetime opportunity. These kinds of deals

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rarely come around. Although Time Warner rejected 21st Century Fox is

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offer, this company has a very determined CEO at the helm `` 21st

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Century Fox'. If Rupert Murdoch sees a good deal, chances are a rebuke

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will not stop him. Let's talk about that in more

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detail. As we were saying, Rupert Murdoch, 83 years old, he is very

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determined. Do you think that he is going to take this rebuttal lightly?

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He is not the kind of person to take no for an answer. I expect the

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rebuff of the deal is not the end of the story. There is likely to be

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further negotiations and offers coming through from Rupert Murdoch.

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Different ends of the spectrum in terms of price, but I suspect that

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these two media moguls will find a mid price they can both agree on.

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According to some calculations, a combined company could achieve

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savings of something like $1 billion. There are a lot of

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synergies here, but it would be a huge organisation. Presumably there

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would be hurdles ahead for the companies, if they were going to get

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together. A merger of this kind is never easy. We had that with two

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larger publicity companies that fell apart. It would not be easy. That $1

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billion of savings touted, it could be achieved but would take a long

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time to achieve. Rupert Murdoch is looking at achieving the vast size

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and power to move into Latin America, where foxes not strong. ``

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when ??MACR O2 is not shift towards net flicks and you have to shift

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towards net flicks that terms of in terms of that big elements would

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have to be releasedthere are talks that big elements would have to be

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released for the OK to be given. If they were to get together. Rupert

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Murdoch has indicated he would sell off CNN if he was not taking the

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deal. CNN is an important part of Time Warner. It indicates how

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serious he is about the deal. It is not that it was done lightly, but he

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would do whatever it takes to succeed in the bed. The shift for

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him, as an individual, not so long ago he was before a Parliamentary

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Select Committee answering questions about hacking in the press. `` bid.

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It seems like he is back on top. You can never underestimate what he

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does, and that agreement shows how serious he is about maintaining

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dominance in the global media industry. Thank you for joining us.

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This is all over the newspapers, we will discuss it in detail when we

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reviewed the international press in ten minutes. `` review the

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international press. The global aviation industry and its

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customers are gathered this week at Farnborough in the South of England

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for the annual air show. The airline business was shaken by the

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disappearance of Malaysian Flight 370 earlier this year. Soon an

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industry task force is expected to set out how flight positioning and

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other data should be automatically transmitted from planes in flight,

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wherever they are in the world, so an airliner can't simply vanish.

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Nigel Cassidy sends this report. When you come here, to the

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Farnborough Airshow, you can get so close to huge aeroplanes like this

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one. You are struck immediately by the contrast between the

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sophistication, data communication, and the fact that, perish the

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thought, one of these goes missing over a large ocean, and the thing

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that you would have to find to discover what happened would be a

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small black, which is actually an orange, box. It is kept under the

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tail fin. Finding the box would not be so crucial if aircraft streamed

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their position to a virtual database, a black box in the cloud.

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Aircraft are being tracked already across the globe. One of the issues

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we have is that there is no mandate repossession for aircraft to be

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tracked everywhere. The only area they are insistently tracked is the

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North Atlantic, because of the commercial advantage of hacking the

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aircraft and getting more volume. The work here by the European space

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agency, and others, is to ensure Iris, a new development of traffic

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control, can be brought forward to deal with the crowded skies over

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Europe. Is it true that there is only one person in the driving seat?

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This is available today, the newest broadband technology could deliver

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more data from aeroplanes. But, operators do not want to pay for it?

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Inmarsat is already installed on the flight decks of over 80% of the

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worlds aircraft, and is capable of handling the tracking. The

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difficulty is that the airlines and the airline regulators have to make

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a decision. Is it any longer acceptable for aircraft not to be

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tracked? As soon as they make that simple decision, we hope they will

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do that in September at the Montreal conference, then they make the

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decision on how they can fix it now and later. Some airlines are not

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waiting to be told to stream the black box data. Even if it is made

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mandatory, getting automated tracking of the worlds 93,000 daily

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flights will take several years. Nigel Cassidy, BBC News,

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Farnborough. In other news: The US has imposed

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its most wide ranging sanctions yet on Russia, targeting oil giant

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Rosneft, as well as several arms firms and senior officials.

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President Obama said Moscow had failed to take the key steps needed

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to stop an escalation of violence in Ukraine. The European Union has also

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agreed to block new loans to Russia by two multilateral lenders, the

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European Investment Bank and European Bank for Reconstruction and

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Development. Australia's Senate has voted to

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scrap the country's carbon tax and plans for emissions trading, which

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was due to begin next year. It is a major victory for conservative Prime

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Minister Tony Abbott, who campaigned on the issue in last year's

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election. Australia is one of the world's biggest carbon emitters on a

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per capita basis, and abandoning plans for the world's second largest

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emissions trading scheme after Europe, is a major setback for

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global CO2 trading. Let's have a look at the financial

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markets, once again, we had the Dow Jones industrial average closing at

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a record high. That was in the United States. A lot of that is to

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do with the flurries surrounding Time Warner. I will see you soon.

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MPs are calling for a ban on the use of B accommodation for teenagers

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who are in local authority

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