28/04/2016 World Business Report


28/04/2016

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Now for the latest financial news, Aaron Heslehurst and

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Welcome to World Business Report. I'm Aaron Heslehurst.

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Facebook keeps on growing, and so do its profits.

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Plus, when $700 billion a year just isn't enough,

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but the Bank of Japan resists enormous pressure to boost its vast

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Welcome to World Business Report. I'm Aaron Heslehurst.

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Nine minutes, ten seconds, that is the deal! I will give you an

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exciting and fascinating look at the business world.

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Also coming up, VW faces investors and the media

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later as it tries to move on from the emissions cheating scandal.

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We start in Silicon Valley, where it's been

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a challenging week for tech giants including Apple and Twitter.

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The world's biggest social network continues to attract new friends by

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the million - and more importantly - to convert them into profit.

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Let's show you the numbers Facebook saw revenue surge more than 50%

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in the first three months of the year to over $5.3 billion - better

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than Wall Street was expecting that's largely down to booming sales

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With smaller screens smartphones have been a platform many other

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Not so Facebook - 82% of Facebook's ad revenue now comes

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The social network has continued to grow and grow as of the end of March

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1.65 billion people were logging on at least once a month.

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That's 200 million people more than this time last year.

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Shares have jumped again in afterhours trade.

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If you look at the past 3 years you can see the value has steadily

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climbed from just over $20 to now well over $100 a share.

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Our North America Business Correspondent Dave Lee has been

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following the story at their headquarters in

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Right now in silicon valley you can rely on two things. Blustery wind

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conditions and Facebook making lots and lots of money. It had exceeded

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Wall Street already skyhigh expectations and it is making more

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money from advertising particularly with users and mobile devices and

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watching video. Excitement about the future potential of the company,

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investing heavily on bringing innovation. Twitter has continued to

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decline and Apple has posted its worst result in over the decade.

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To Japan now where the central bank has decided not to expand its

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massive economic stimulus programme, despite enormous pressure.

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They are trying to banish deflation - or falling prices -

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In the last few hours official data has shown consumer prices fell

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Japan's policy makers are fast running out of ammunition.

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They are already pumping money into the economy at a rate

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of 80 trillion yen a year - that's more than $700 billion.

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And in January they stunned markets by

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introducing a negative interest rate - charging banks 0.1% to park money

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with the Bank of Japan - in the hope it will push them to lend it out.

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Seijiro Takeshita is Professor of Management and Information

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at the University of Shizuoka, He joins us via Skype.

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My friend, good to see you. What the heck happened! What are you doing

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over there? The entire world was expecting boost in the arm to the

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economy? 65% of participants were expecting some kind of action but

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for two reasons, they have seen of the saturating effect and secondly,

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a lot of criticism about the lack of stability. We need stability in the

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system and the ball is actually in the court of the action. I am just

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wondering... Some may suggest all that money is not working, we saw

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the latest numbers, but for the Japanese economy, look, we know it

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has been in the dog house for far too long, instead of printing and

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spending all that money, in lay terms, it needs an economic change

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to the structure? Definitely. Structural transitions is obviously

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needed in Japan. You can see the second set clearly depicts those

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areas. But the market is expecting answers, 65% of participants

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expecting something, but the results of these structure changes take

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years. There is big gap between the two and that is why we are seeing

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our lack of patience and it is exacerbating the situation. Short

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and sweet as always but we appreciate your time.

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To Germany now where the car giant Volkswagen faces

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investors and the media later as it presents its annual results.

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VW has already revealed it made the biggest loss

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in its history last year after setting aside more than 16 billion

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euros towards costs arising from its cheating of diesel emissions tests.

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Investors have seen their dividend cut for the first time in six years

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- they will be hoping for more clarity on the rising bill from the

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VW insists it is on the road to recovery. It now believes it knows

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how much of the scandal will cost and can start looking to the future.

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Set aside 60.2 billion euros to cover buying back up to 500,000 cars

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in the US, modifying millions of others around the world, paying

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fines and settling legal claims. It made an operating loss in 2015 of

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more than 4 billion euros. Senior executives have seen their pay cut

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back. Ordinary members of the board will use more than 2 million euros

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apiece compared to the year before. But we did not know he was

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ultimately responsible. VW has refused to publish findings of an

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internal investigation saying it would undermine negotiations with US

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authorities. Investors are keen to know how much progress has been made

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in finalising those talks. Meanwhile, they wanted to consumers

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attention away from its past wrongdoing and into its latest

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products. Let's return to Asia where Samsung

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Electronics says its first-quarter operating profit was up 12 %

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in the three months to March - thanks to strong early sales of its

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new flagship Galaxy S7 smartphones. Good to see it as always. Tell us

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the story? The Galaxy phone that you mention and also the profit is very

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much aligned with large Samsung had forecast. The huge improvement over

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the two years of shrinking profits and losses and adding to hopes this

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will be the first annual profit in three years. You saw the smart phone

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profit jumping to an almost two-year high. Samsung saying it is expecting

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further growth for the Galaxy at seven device as well for its move to

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lower tier product. The cheaper phones at our key because that is

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where Samsung are battering against much cheaper phones made in China.

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Some sang makes a lot of other things, chips or example and profits

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had fallen 6% because they were undercut by price decline. Slower

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demand for personal computers. Generally brighter outlook for the

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firm stop thank you. Talk to you soon. Quick flash of the markets.

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Because of that non- move in Japan, we see the yen is up but the BK is

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down. AM running out of time but I will be back to have looked at some

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of the papers. See you soon.

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